Evidence of meeting #100 for Government Operations and Estimates in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was report.
A video is available from Parliament.
Procurement Ombudsman, Office of the Procurement Ombudsman
The way it was done during the last five years was that it was department by department. It was static lines of inquiry across 17 different departments.
Liberal
January 31st, 2024 / 6:35 p.m.
Procurement Ombudsman, Office of the Procurement Ombudsman
Absolutely.
We've done a few that I would describe as “ad hoc”. They weren't part of our systemic plans.
That being said, our bandwidth is limited. Again, I don't want to make a plea to this committee, but I will say there's a lot of important work that needs to be done and I'm not sure that I have the resources to do that work.
Thankfully, for this work and the work of McKinsey, we were granted the funds to do so. However, in future years as we plan for new procurement practice reviews in other areas where we think we could be highly beneficial to the procurement landscape, I'm not sure that we have the resources to do so.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
Thank you.
There are a lot of eyes on this particular issue. There's a lot of scrutiny on this issue. You have an Auditor General report. You have, obviously, the procurement ombudsman report that you submitted. CBSA is doing their internal audit. RCMP is investigating a related issue. Then, of course, you have the OGGO committee looking at this issue. There are a lot of eyes on this particular issue.
Can you talk a little bit about your experience working with CBSA and PSPC, which are the subjects of this review—and Shared Services as well? Can you tell us a little bit about your experience over the last year? How forthcoming have they been in providing information and in making your work go more smoothly? Can you speak a little bit about your engagement with all of those government departments?
Procurement Ombudsman, Office of the Procurement Ombudsman
I'll let Derek answer the second part of this.
I just wanted to say that we do follow a pretty standardized process when it comes to these reviews. Those departments that were subject to the review would have been provided preliminary observations, at which point they would have been given an opportunity to speak to any observations that we had seen based on a file-by-file analysis.
After receiving any additional documentation, corrections, etc., we would then go to that first draft. We would provide them a first draft of the report with a 20 working-day review period so they could analyze the text of the draft and they could provide, again, additional feedback and precision. Again, that's where we want to land—a factually accurate position—so, if there were additional documents that they could provide, which did happen in many instances, then we would take those into consideration prior to finalizing the report. Then there's a final 10-day review period.
There would have been interactions between us and the departments that were subjected to the review during those touchpoints.
Derek was the one who really managed the relationships, so I'll let him speak to how cordial or not those relationships were.
Acting Director, Inquiries, Quality Assurance & Risk Management, Office of the Procurement Ombudsman
Early in the process, Alexander wrote to the deputy heads of those departments, who identified a point of contact, usually a member of their senior management team. Then we held initial meetings with them—what we refer to as our “kickoff meetings”. From there, we extended our document request to each of the departments.
I will say that we received good support from each of the three involved in this particular review. We had some back-and-forth, of course, because they provide initial documents. Oftentimes, we had questions about them. They were quite responsive in providing those responses. That was through the early stages.
Then, as the procurement ombudsman was just describing, as we got to the stages later in the review when we had results, we again had meetings with them if they had questions about the preliminary observations. They would provide the responses, which we considered as we were developing the draft report, which eventually led to the final report the committee received.
Conservative
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
Thank you very much, Mr. Chair.
I want to go back to my original question about the lack of documentation and bring that together with what my colleague raised in regard to the Globe and Mail article about Canada's chief technology officer.
With this finding paired together with the allegations published last week—that an IT specialist at CBSA is accusing a VP of erasing data—is it possible that data relating to the initial request for a bid may have been erased as well? Are you concerned at all that this is the case—that there is missing documentation? We now have these allegations of someone deliberately doing that.
Procurement Ombudsman, Office of the Procurement Ombudsman
Obviously, the allegations are very concerning, particularly from a procurement standpoint. You will have noticed in our annual report that one of the things we identify is not having the right to compel documentation. It's a particular frustration point for me. I have to admit that, when I watch these committee proceedings, I'm a bit envious of how you compel documentation.
I would describe the authorities we have as lesser than those of a Canadian citizen. If they make an access to information request, at least it's protected under the Access to Information Act and there are specific guidelines that need to be followed. With our request, there are no such guidelines, so we're acting on the goodwill of the parties to provide us with the documentation. Where there is a lack of documentation, I'm never 100% clear on whether it's the result of our inability to compel documentation or a purposeful exclusion. That's when I ask, “At what point do we start making negative inferences and stop just talking about documentation?”
Like I said, you'll hear “documentation” come up several times this evening, because it is one of the largest irritants I have, currently—not just with ArriveCAN but also in general—when it comes to performing the work we need to do.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
Thank you very much.
I'm going back to 76% of the listed resources in successful bids doing no work on the ArriveCAN contracts.
I'm thinking this means that companies were winning bids based on the resources their subcontractors claimed they would provide if they won the contract. Then, when the time came to do the work, the companies that won switched their subcontractors.
I have questions in regard to that.
When these switches occurred, were there ever any reassessments of the capabilities of the new resources, or a renegotiation of the prices based on different resources? Is there any documentation on that? Was there ever a change in price when resources were substituted?
Procurement Ombudsman, Office of the Procurement Ombudsman
Thank you.
I'll let Derek answer this one.
Acting Director, Inquiries, Quality Assurance & Risk Management, Office of the Procurement Ombudsman
Thank you for the question.
There is a process set up through the task authorization process. Under these professional services contracts, as we stated earlier, no one was named in the contract. Anyone who was included in the bid wasn't named directly in the contract. They were only authorized to perform the work once they were added to a task authorization. Anyone who wasn't previously evaluated as part of the bid evaluation would have been evaluated at the time the task authorization was issued.
Whenever we saw documents, there were some missing. When those documents were on file, we were able to identify that, yes, the individuals who were put forward as replacements for those included in the bid met the minimum requirements for those positions.
There was no renegotiation of rates, to answer your other question.
Conservative
Kelly Block Conservative Carlton Trail—Eagle Creek, SK
With that answer, it is possible to conclude that, potentially, the vendors brought in resources that may not have cost them as much, and therefore received a greater profit on the project.
Acting Director, Inquiries, Quality Assurance & Risk Management, Office of the Procurement Ombudsman
That's a possibility. We don't have any information in that respect, though.
Conservative
Liberal
Parm Bains Liberal Steveston—Richmond East, BC
Thank you, Mr. Chair.
Thank you to our guests for joining us today.
You know, I'm always surprised at how much I learn. I know that our chair calls this “the mighty OGGO”. We learn a lot here about our systems and their many layers.
I want to go along the same line of questioning in order to understand this a little bit more. You talked about the practice of swapping that's commonly known around procurement. Obviously, it's systemic. Do you know how long this has been going on? Do you believe this has become a normalized practice, where certain people outside the departments are being relied upon to headhunt for them and find these things? Again, has it become a normalized practice?
Procurement Ombudsman, Office of the Procurement Ombudsman
I would not want to say that it's a normalized practice. I would say that it definitely occurs. I would agree with the characterization that it's systemic. As I said in my previous answer, I can't comment as to whether what we saw in ArriveCAN is better or worse than what we typically see. It is certainly filling my head with ideas in terms of a potential secondary review associated with this issue to be able to better answer these questions.
Again, I don't want to say it's normalized, because—
Liberal
Parm Bains Liberal Steveston—Richmond East, BC
Would that be a recommendation, moving forward, to actually look at this particular occurrence and review that specific practice? It brings me to my next question: How do we fix that?
Procurement Ombudsman, Office of the Procurement Ombudsman
As you heard in my opening comments, in order for me to launch a review, I need reasonable grounds to do so. This is a perfect gateway to create reasonable grounds, because now we've seen the issue. We've known about the issue. We were able to make recommendations to help remediate. With that being said, I do think it speaks to reasonable grounds.
The cautionary tale here is that I also have to tie this to part of my previous answer, which spoke to funding. In order to be able to pursue many systemic reviews, I think we'll require additional funding for the foreseeable future.
Liberal
Parm Bains Liberal Steveston—Richmond East, BC
On the issue of the bands and the median pricing, we were unable, I think, in previous questions, to determine how long that system has been in place. Did we come to that point from trial and error? Are you aware of how we reached this specific part?
Procurement Ombudsman, Office of the Procurement Ombudsman
I don't have the history. I'm not sure if Derek has any additional history.
This was our first vantage point of the bands. As I said in the previous answer, we had a similar reaction—that it didn't seem logical—and then I think the changes to the band structure weren't justified. As a result, some of the provisions that were meant to capture a price substantiation for lower weren't actually triggered because of the change.
Acting Director, Inquiries, Quality Assurance & Risk Management, Office of the Procurement Ombudsman
Perhaps I can just add that, in addition to that, PSPC informed us that in the past, when they've tried to use that clause as it exists currently, it's been ineffective at trying to determine whether or not the supplier was able to fulfill the contract with the lower rates they had provided. That led to our recommendation around correcting that clause so that they had a mechanism that would be effective in validating lower rates when they're lower than the median band rates proposed by the suppliers.
