Government Operations Committee on June 9th, 2021

[Kelly McCauley, Conservative, Edmonton West, AB]

Ms. Suitor and Mr. Sinclair, would you comment?

[The Chair, Conservative, Robert Gordon Kitchen]

The technicians are working with Mr. Sinclair to correct his issue, so if Ms. Suitor would be able to answer, that would be the best way.

[Marnie Suitor]

Thank you.

I'm actually working at the civic level with the City of Edmonton on their procurement strategy, so some of the conversation that's come up so far is interesting. If we think about ownership at 51%, I've worked with indigenous businesses that are 100% indigenously owned, but in the background there are blind trust agreements, etc., that transfer the actual operation of the business to non-indigenous people, so having that criterion of ownership does also create some other nuances.

I've seen the other side. We've had a business that is 100% indigenous owned and operated but cannot meet the requirement for the employee base. The example would be in the engineering or architectural world. Here in Edmonton, we have a very reputable business that is capable and qualified, but they could never meet the 33% threshold, because they're not able to find the skill set within the indigenous community to meet that requirement. Therefore, there are challenges on both sides.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Ms. Suitor. Thank you, Mr. McCauley.

[Kelly McCauley, Conservative, Edmonton West, AB]

Thank you.

[The Chair, Conservative, Robert Gordon Kitchen]

We'll now go to Mr. Weiler for six minutes.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Mr. Chair.

I'd also like to thank our witnesses for their patience in joining our committee meeting tonight.

Maybe I should start by recognizing that I'm streaming from my home on the traditional unceded territory of Coast Salish peoples, including the Squamish, Tsleil-Waututh and Musqueam nations.

What came up in the opening comments for everybody was that one of the big barriers to having increased indigenous involvement in government procurement was the complexity of the RFP process. Mr. Ducharme mentioned a couple of things: the challenges with previous work history with the government and lack of feedback.

Mr. Ducharme, I was hoping you could explain a little bit on your thoughts about how the RFP process itself could be simplified and how that might be able to increase indigenous procurement.

[Philip Ducharme]

Thank you.

I think you could look at some of the RFPs. If you could unbundle them or if you didn't have so many criteria in them, it would help. It's set up right now so that all the mandatory criteria in these RFPs are almost a weed-out mechanism, and that's what a lot of our businesses struggle with, especially with the previous platform, the Buyandsell and the epost that the federal government was using. There would be one little thing that would be missed, and because of that, they were non-compliant and their bids are not even being looked at. I think making not as many mandatory requirements.... It almost seems like the requirements, as I said earlier, are there to set us up for failure. My understanding is that the new procurement platform the federal government is going to is going to make it a little bit easier so that people aren't going to be losing out by not having a document that's uploaded.

Again, I think by simplifying the contracts.... We had one supplier who said he spent $10,000 to respond to the bid because there was so much. It was a technical RFP, but there's no reason that something that's worth $10 million is going to have to require the same amount of work as a $10,000 or $100,000 RFP.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you for that, Mr Ducharme.

I'd like to ask the same question to Ms. Suitor, as well as to Mr. Metatawabin.

[Marnie Suitor]

My comments would be somewhat similar. I think it's important to scale the RFP to the work that's being required by actually taking a look within to understand the risk, the scope, the dollar value, and then adjust the RFP accordingly. Is the requirement to hold, let's say, $5 million worth of insurance really practical for someone who's bidding on a $150,000 contract? Those types of things would be helpful.

[Shannin Metatawabin]

I would like to add that if we viewed investing in indigenous businesses as an investment, we'd see that the social impacts for an indigenous-owned business in the community include a 72% increase in life satisfaction, a 52% increase in mental health indicators and a 19% increase in health indicators, so there are actually cost savings there.

There are also ancillary benefits to other community members with that business. There are community-owned businesses that have bid on contracts within their own community and have been weeded out because of the complexity of the bidding process. There needs to be a full change on how this is set up so that the community-owned business is at the front of the line, because they're going to be hiring their community members and the benefits are going to remain in that community. Right now, the system is set up to fail, as Philip has pointed out. We need to remove those barriers, just like we have with so many other barriers in front of us, and we're going to see a lot more impact.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

We would appreciate your sharing with the committee, if you could, the report that has those statistics.

A number of things have come up at this meeting today, including that some of the other jurisdictions that have set targets and increased targets, with enforcement measures to ensure they are met, have been able to meet them. I'd be curious to hear your comments on what changes took place within government procurement to facilitate that additional procurement, in addition to just the targets. What actual changes in their process took place that led to that improvement?

I'll go first to Mr. Metatawabin, please.

[Shannin Metatawabin]

I'm going to refer to something I have in front of me here, which says that in 2019 and 2020, Australian indigenous procurement outcomes had a target of $195 million. The results were $854 million. The results exceeded the target by about 4.3%.

Also, Saskatchewan Power in 2019 had a target of 3.5%. The results are 8.6%.

There's a large-fold increase in the targets. This is because they're actually implementing procurement and caring about it.

Maybe Rocky can speak to this, but Suncor has had the longest procurement process with some of the tribes in Alberta. That's kind of where corporations have taken the lead to implement processes through impact benefit agreements that have hard targets and consequences for not meeting them. You lose your social licence to operate. We almost need to get into that kind of territory if we really want procurement to make an impact.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you.

We will now go to Ms. Vignola for six minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you, Mr. Chair.

Thank you very much for being here, Ms. Suitor, Mr. Metatawabin, Mr. Sinclair and Mr. Ducharme, and also for your patience. I am extremely grateful to you.

You talked about the government initiatives that have been put in place since 1996, but you also talked about how difficult it is, at times, to find qualified employees within the community itself. That reminded me of something. Seventeen years ago, I took part in the E‑Spirit aboriginal business plan competition. That was an indigenous entrepreneurship competition whose goal was precisely to foster young people's desire to go to school and excel, to be able to acquire skills, and so on. As far as I know, that competition no longer exists.

To improve the qualification, what initiatives would work—because to date, we are seeing things that sometimes work and sometimes don't—and would enable indigenous businesses to find qualified employees within their communities?

Do you want to answer my question, Mr. Metatawabin?

[Shannin Metatawabin]

Oh, I like this question. This is so important.

When you think about creating an entrepreneur, you have to start at the very beginning. This starts with the children.

I was speaking with Chris Googoo today from Ulnooweg. They have a whole pathway of learning whereby they enter the schools to begin introducing STEM, introducing skills and innovation, so that when the students get to the time when they're selecting careers, they'll either go to school or start a business. They already have entrepreneurship and business in their vocabulary. That's so important.

The AFI network works with businesses every day. They're always developing capacity programs and providing the training directly to the entrepreneur. However, support for the indigenous business development network has decreased by 70% in the past 20 years. Rocky, who has a certain number of business officers, has reduced his numbers because the support he has received is not there anymore. We need to increase that and provide some enablers, some stimulus, to ensure that we can provide the skills to everybody who wants to start a business.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you for your answer, Mr. Metatawabin.

Stop me if I have it wrong, but from what I am hearing, not only do the initiatives fail, but there has also been a funding cut that has exacerbated the record of failure.

Have I understood correctly, Mr. Metatawabin?

[Shannin Metatawabin]

If we take it back a little bit further, a number of barriers were created for indigenous people placed in reserves, away from the market. We have legislation in the Indian Act that prevents us from using our house as security. We don't have any wealth generation within our community, so equity is a problem, and so are skilling in the community, infrastructure and water. People are surviving on a day-to-day basis.

Providing skilling so that people can consider entrepreneurship as an option is a huge win. If we can do that and have government that is willing to say that indigenous people matter, this is low-hanging fruit. We can provide reconciliation by providing government opportunities that are already there. We just have to enable the indigenous business by saying that this is a real opportunity and it's going to happen this time.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

I am going to ask you each to answer the next question.

The autonomy and self-determination of the First Nations are values that are very important to me and must be prioritized.

At present, the government finally seems to understand that in order for measures to be effective, they have to be put in place in collaboration with the First Nations, not imposed on them.

You have skills and you have experience, ideas and a culture. All of that has to be put to work.

Is it possible that the explanation for the low percentages of contracts awarded and of successful initiatives can be explained in part, but not solely, by the fact that there has been little inclusion of the First Nations in the processes and consultations and in deciding the changes that have been made?

[Philip Ducharme]

If I could go ahead, I think this sort of ties back to what you said as well.

One thing we need to ensure is that the federal government works with indigenous businesses well before an RFP is posted. Once an RFP is posted, it's too late for our businesses to scale up and go out and resource the employees they need.

I know that even within the Centre Block in Ottawa, a lot of construction will be going on in the next 20 to 30 years. As well, we're working with the federal government and OSME to try to ensure that these businesses realize what opportunities are coming up. Then we can work with the asset holders and say that these are the types of trades and opportunities that will be required in our indigenous businesses to be able to fulfill these contracts, so that when the actual RFP is posted, we're able to apply to it and we're capable of responding to those RFPs fully, without having to scramble and then say that we don't have the means.

I think one of the best things that needs to happen is more engagement prior to the actual RFP coming out.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Mr. Ducharme.

If the other witnesses would like to respond to that question, they could maybe put that in writing. Unfortunately, due to time, we have to move on, unless Ms. Vignola wants to bring the matter up again when she next has an opportunity to ask a question.

We'll now go to Mr. Green for six minutes.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you very much, Mr. Chair, and thank you to all the witnesses.

I'm going to start by doing something I don't normally do. That's just noting in a very non-partisan way that I believe in my heart that all the members of this committee want to see increased procurement coming through to the indigenous communities. They want to see the programs that are in place work. I believe that to be true on the opposition side and on the government side.

I would also note that nobody understands the challenges that are faced in our first nations, Métis and Inuit communities better than those who are actually experiencing them. Your testimony today, in a very short period of time—notwithstanding the wait that you had—has already laid out some really compelling and very obvious next steps for this government to take.

I want to note that I have a concern about timing and what may or may not happen out of this study in terms of our being able to report back and have recommendations from this study. I'm unclear about whether that's going to happen in this session or the next. I do, however, want the opportunity to get on the record a few of the points that have been reiterated, because unfortunately I won't be able to pass it as a motion at this point. I don't think it would be time-effective.

Mr. Ducharme, you brought out what was for me one of the most compelling points, which was that if it doesn't get measured, it doesn't get done. I've been pushing the Auditor General to include, in all of their audits and studies, a framework very similar to what you identified in terms of having open and transparent reporting on the deliverables and the outcomes within the main estimates. I think you also touched on departmental plans. You also talked about, I believe, a directive on performance management.

Could you please restate those points from your notes, to go back into the Hansard, for people who are watching? Hopefully, the senior members or parliamentary secretaries who are here could take this back and maybe move on this, without our having to do anything formally.

Can you restate that ask with detail?

[Philip Ducharme]

I'll get to my notes here.

I think one of the areas we talked about was the directive on performance management. It would be as simple as changing 4.1.2 and including indigenous procurement in there. Right now it says, “determining, in consultation with the deputy head, the departmental criteria for talent management plans”. If we were to include “including indigenous procurement targets in accordance with the appendix to this directive”, it would make a big difference.

Also, the standard on performance management, specifically in A.2.2.1.1, could also now potentially read, “Clear and measurable work objectives, with associated performance measures including indigenous procurement targets, that are linked to the priorities of the organization and of the Government of Canada”. Again, this is something that can be done without being legislated.

In other programs that were held in the U.S., it was actually legislated, and that's what made the difference. I think it was President Nixon who brought that executive order forward in 1968. I think here in Canada the mandate is a good start. As Shannin also mentioned, there does need to be teeth to it; otherwise, it's not going to resonate and happen.

[Matthew Green, NDP, Hamilton Centre, ON]

I believe you referenced having a reporting back in the main and supplementary estimates. Perhaps you could find that in your notes and also repeat that for the purpose of the committee. My hope again is that the colleagues we have here in government, the policy people who are tapped into these calls, will get a chance to hear this and maybe take you up on it as a form of real movement from this government towards outcomes.