Government Operations Committee on March 20th, 2024

[The Chair, Conservative, Kelly McCauley]

Thanks.

I'm afraid, Mr. Jones, that is our time. Perhaps you can give a more extended response to the committee in writing.

Mr. Bachrach, please go ahead for five minutes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

Minister, Canadians have been rightly shocked and horrified as the details of the botched ArriveCAN procurement have been made public.

One aspect that I think seems particularly egregious to people is the charging of commissions by contractors who do very little work, if any.

I thought this was illustrated best by some communication that came out through the investigation by Botler, the IT company from Montreal. They describe a phone call with the principal of GC Strategies in which he talks about CBSA essentially rolling out this particular IT product to the rest of the government's departments and that a 15% commission would be charged by his company, something that he laughed at, and he said that the higher pricing would “suck for Canada”.

Do you agree that charging those kinds of commissions sucks for Canada?

[Jean-Yves Duclos, Liberal, Québec, QC]

Let me answer that great question in three different ways.

First—

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Be brief, because I only have five minutes.

[Jean-Yves Duclos, Liberal, Québec, QC]

The first piece is that in normal circumstances, you would want those services to be provided by the public service. There are hundreds of thousands of public servants who work very hard and invest their talents and energy every day to make a difference for Canada. You'd want that expertise and those efforts of the public service to be used.

The second thing is if that's not the case and there is no ability to do that. In a complex world, which is becoming more complex every day, there are instances in which it's not possible for the public service to answer all of those needs, or it might be that it's too urgent to do so. There would be too little time to do that, as was the case during COVID-19.

The third piece, I would say, is that when staff augmentation or contracting is needed for Canadians' safety and health to be protected, as was the case with COVID-19, that has to be done following the rules. These rules were very clear during COVID-19. Unfortunately, they were not followed by all public servants.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Correct me if I'm wrong, Minister, but there's no rule against charging a commission and doing absolutely no work for that commission. You're a company and you're going to get a government contract; you subcontract that work to someone else and charge 15%. The Canadian public gets very little value for that 15%.

Tell me if there's a rule in the Government of Canada that prevents that from happening.

[Jean-Yves Duclos, Liberal, Québec, QC]

There are two important points that you mentioned.

The first is the process and the second is the value.

The process has to be open, fair and transparent. It's part of this team's job to make sure that this is the case in all contracts, including in emergency contracts, as was the case during COVID-19.

The second piece is value for money.

Value for money is to be assessed by what we call “client departments”. In this case it was CBSA. CBSA had to decide whether it thought it was value for money to invest in that particular contract in the context of the COVID-19 emergency. They thought the emergency, the speed and the complexity of the work they faced deserved a contract of that sort.

There were rules that had to be followed. They knew these rules. The rules were clearly stated. Unfortunately, some of them—yes, a small number of them—didn't follow those rules, and you know the outcomes.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

I didn't hear an answer to the question. The question was very simple: Does the Government of Canada have a rule against charging commissions and not doing any work for the commission?

We're talking about the evidence before the committees of Parliament showing that it can be 15% or 30%, and there can be several layers. You can get to a point where the Government of Canada is contracting something out and only half of the actual monetary value is going toward doing the actual work.

The Canadian public should be horrified that this is happening. The Auditor General very clearly said in her report that your government overpaid for the ArriveCAN app. I'm not sensing any sort of contrition or embarrassment or a sense that this is wrong. I asked you if you agree that it sucks for Canada, and you didn't answer.

Does it suck for Canada that we're wasting money on these apps and contracts for companies that do little or no work?

I think it does.

[Jean-Yves Duclos, Liberal, Québec, QC]

This answer does indeed come from the Auditor General, who said very clearly that there wasn't enough value for money in the work that was done by GC Strategies. She said that many weeks ago, and she's correct. She pointed out that had that job been done within the federal public service, it would have cost about 50% less.

Whether that would have been possible—

[The Chair, Conservative, Kelly McCauley]

I'm sorry. That is our time. Minister, I have to cut you off.

We're going to go on to the next round. We're doing four minutes, four minutes, two minutes, two minutes and then four minutes in order to get the minister out by 5:30.

Go ahead, Mrs. Block.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you.

To give you a heads-up, Chair, I'm going to take the first couple of minutes and then pass it over to my colleague Mr. Genuis.

Bill Curry reported that ”Officials said the three subcontractors are not connected to the ArriveCan app for international travellers.” They are different from GC Strategies.

Can you please confirm that for me?

[Jean-Yves Duclos, Liberal, Québec, QC]

Can you expand on what you would like me to answer?

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Can you confirm that the three subcontractors are not connected to the ArriveCAN application?

[Jean-Yves Duclos, Liberal, Québec, QC]

Do you mean the three subcontractors we spoke of earlier in the case this morning? Yes, that is the information we have.

Again, it's information that is not complete, because no one would like to know in this room that a minister is meddling with RCMP investigations. The information we have is that this is the case.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you.

We've also learned from Bill Curry and you that there are even more cases being looked into.

Under your government, $21 billion has been paid to external consultants. How many of them are fraudsters and how much money have they been paid?

[Jean-Yves Duclos, Liberal, Québec, QC]

The good news is that you are asking this question today. We had a press conference just a moment ago, during which we pointed to the fact that electronic procurement activities over the last years have been accelerated. The good outcome of that is that we're now able to find out about those fraudulent activities. They have probably been going on for decades, but we couldn't do anything about them because there was no ability to collect, gather and analyze data.

The good news is that we have data analytics in 2024. We have the ability to share electronic data, and we're able to do a lot more.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Minister, the good news is that it was Conservatives who introduced a motion here in this committee and in the House to have this investigated, and your caucus voted against it.

Thanks.

[Jean-Yves Duclos, Liberal, Québec, QC]

Obviously, we are all very pleased that all MPs contribute to the work of this committee.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

That wasn't the question.

[Jean-Yves Duclos, Liberal, Québec, QC]

This, however, comes from a 2018 budget investment—

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Minister, thanks. It's my time now.

I'd like to ask you a very specific question. When were you first briefed on the issues and challenges with ArriveCAN?

[Jean-Yves Duclos, Liberal, Québec, QC]

I was aware of it for a number of years. That's the first thing.

The second thing is that I was briefed very quickly after my coming into office.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Do you have a date for us?

[Jean-Yves Duclos, Liberal, Québec, QC]

It was probably some time around the end of August or early September.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you.

Did you provide any direction at that time?