Government Operations Committee on Feb. 14th, 2024

[Karen Hogan]

Again, when it was a non-competitive process, I would have expected during the initial contract award for the ArriveCAN application to see a proper assessment done, but as we noted in our audit report, there is very little documentation to support why GC Strategies was selected.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Would you see a comparison between the McKinsey consulting study that you are currently working on—the report is due out in May, I understand—and an extension of a study into GC Strategies? It seems to me that McKinsey would be a third party external consultant, and that you are currently auditing it within the government and the use by the government of this company.

Would you not say that's something similar in your evaluation of its practices as far as they apply to this ArriveCAN report?

[Karen Hogan]

I think both vendors are under professional services contracts, and that's what our audit is looking at. We expect to table later this year. It will be broader than just looking at professional services contracts linked to ArriveCAN.

I normally do not comment on the results of an audit until we make it public in the House of Commons.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

It sounds like the organizations are similar, though.

Thank you very much, Mr. Chair.

Thank you, Auditor General.

[The Chair, Conservative, Kelly McCauley]

Thank you very much. That is your time.

Mr. Bains, please go ahead.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you, Mr. Chair.

Thank you, Madam Hogan and our witnesses, for joining us today.

This whole study that is being conducted here is extremely important. It has led us in multiple different directions, and we're trying to uncover where these decisions were made. Ultimately, an investigation is going on. We understand that, and we can't delve into the investigation itself, as other authorities are conducting it, but have you seen any evidence of corruption?

[Karen Hogan]

When it comes to matters of a criminal nature, I would tell you that the experts in this area are the RCMP, and I will leave that evaluation to them.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

You're not in any way involved in that piece of the investigation. You're looking at discrepancies in documentation and those sorts of things.

[Karen Hogan]

It's the RCMP's responsibility and not that of the Auditor General's Office to look into matters of a criminal nature.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Okay, thank you.

Would it be safe to say that this kind of contracting occurs at the level of officials? Concerning the study you've been conducting, public service officials are involved in the contracting that takes place.

Are there any political-level members involved in this? Has that come across anywhere? Did ministers sign off on this?

[Karen Hogan]

I think in a situation like this, when so much goes wrong, I would tell you that every level of management is responsible and accountable for this. It isn't just contracting decisions. It was poor project management, and it was poor testing of an IT system before it went live. There was so much that didn't happen the way it should happen. I would tell you that it's all the levels of management within the public service.

When it comes to briefings, again, with no governance structure or oversight mechanism set up, we saw very little of that. We did see some email exchanges that showed that the deputy was aware of things, but there was very little briefing. The thinness of the file is such that I can't comment on briefings to anyone outside of the public service.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Information sharing did not go far enough when decisions were made.

[Karen Hogan]

If briefings occurred, they were not maintained. You would have expected to see something formal about a briefing to a deputy head or to the political arm, and there is no evidence of this on file in a formal way.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

I recall asking the question of Mr. Doan specifically as to who made this decision. He said that the team made the decision, and I asked him how many members were on the team. He said 1,600, so then I asked him if 1,600 people made the decision. Then the answer was, no, there are six board members, so we are still sort of uncovering that.

Were you able to pinpoint those decisions at some point out of all those people you mentioned?

[Karen Hogan]

As we noted in the audit report, we were unable to determine exactly who made the decision to award the contract to GC Strategies. I guess I would tell you two things. One is that I would expect that a deputy head is always answerable for all questions that happen in their organization, and that's why management plays an important role. The assistant deputy ministers, the directors general and the directors all play an important role in ensuring that policies are followed and that the right tone is set so that files are properly documented.

In this case, what we saw around the decision is that the executive director signed off on a contract requisition that authorized Public Services and Procurement Canada to issue the contract. In my view, when a public servant exercises the delegation of authority that is given to them, that comes with responsibility and accountability.

Now, if they felt that they had been pressured or didn't want to do this, then they should have informed their supervisor or someone else in the agency, or followed any of the mechanisms that are available when they feel they're being pressured, and we saw none of that.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

There was no evidence of that.

[Karen Hogan]

We saw that the executive director signed the contract requisition. In my view, that comes with responsibility and accountability.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you.

Is my time up?

[The Chair, Conservative, Kelly McCauley]

Thank you very much, Mr. Bains. You have about 10 seconds left, but I'll add it onto your next round.

Mrs. Vignola, you have two and a half minutes, please.

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

Thank you, Mr. Chair.

Ms. Hogan, you said that public servants had been invited to dinners and that you saw no evidence that they had disclosed the invitations, gifts or what have you. However, did you find any evidence that they had accepted the invitations?

[Karen Hogan]

Yes, under CBSA's code of conduct, employees are required to notify their supervisor of those kinds of situations. We found no evidence that they had done so. I spoke with some individuals who said that they had notified their supervisor. If they did so orally, we saw no evidence of it. Having that information documented is important to show that mitigation measures were put in place to avoid any conflict of interest, real or apparent.

We didn't see any such documentation.

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

Is there evidence that they attended the events?

[Karen Hogan]

It's uncertain, but under the code of conduct, employees have an obligation to inform their supervisor when they are invited to an event, even if they don't go.

On the basis of the interviews I conducted, I think certain individuals attended the events, but I can't say with certainty.

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

All right.

Earlier, we were talking about how the Treasury Board Secretariat had encouraged departments and agencies to be more flexible for the purpose of achieving results, while still demonstrating due diligence.

When it issued that policy or advice, did the Treasury Board Secretariat provide a procedure for organizations to follow? Was it just a notice? Did the Treasury Board Secretariat provide guidance on the procedure to follow, or did it simply tell the public service that this was an emergency situation, that everyone was overwhelmed and that organizations needed to be flexible?

[Karen Hogan]

The Treasury Board Secretariat sent the public service a letter. The letter was very clear, indicating that organizations could be flexible in following the usual processes, which can be cumbersome and time-consuming. The letter made it very clear, though, that decisions had to be documented.

The letter didn't stipulate how organizations should document decisions, but doing so was necessary in order to demonstrate proper accountability to Canadians.