Government Operations Committee on March 26th, 2024

[Irek Kusmierczyk, Liberal, Windsor—Tecumseh, ON]

I have a point of order, Mr. Chair.

I don't mean to interrupt my honourable colleague's train of thought, but I just want to know the relevance here.

This is the ArriveCAN study and we are looking into ArriveCAN, not CARM, so I would kindly ask my colleague to establish the relevance to the study on ArriveCAN.

Thank you.

[The Chair, Conservative, Kelly McCauley]

I actually see the relevance, so I'll allow him to continue.

I think we heard from witnesses that Deloitte, which is running CARM, was messing up CARM and, therefore, was in the penalty box, which led to us getting GC Strategies. I appreciate your point, but I do see the link.

Go ahead. You still have four minutes and four seconds—

[Irek Kusmierczyk, Liberal, Windsor—Tecumseh, ON]

I'm sorry, but I have a point of order, Mr. Chair.

I do apologize, but that is such a tenuous thread, if I can even call it that. Again, may I remind the chair that we're here on a constituency week to study ArriveCAN, and I'd prefer us to focus on ArriveCAN.

What is the link to CARM? I don't see it, Mr. Chair.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

The link is the contracting irregularities that took place in CARM. Deloitte was allegedly put in the penalty box, which is how we ended up with GC Strategies, so the link is pretty direct in exploring how we got to GC Strategies through the problems with CARM. That might illuminate the committee with respect to this study.

[The Chair, Conservative, Kelly McCauley]

I'm fine with that.

Go ahead, Mr. Seeback. You have four minutes and four seconds.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Thanks very much.

Was this actually a project that started in 2010, as Mr. Gallivan stated, or in 2014, which you published in the Gazette a mere two weeks ago?

[Jonathan Moor]

If I can just deal with the penalty box comment.... I'm not aware of anyone saying that Deloitte was in the penalty box. It is worth identifying that Deloitte worked with us on a number of other things, as well. I, in the finance and corporate management branch—

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

We'll be happy to provide that to the committee from the ATIP requests, and we'll bring you back to talk about it, but could you answer my question? Is this a project that started in 2010 or 2014? Your government is saying two absolutely contradictory things.

[Jonathan Moor]

I'll ask Mr. Leahy to answer this.

[Mike Leahy]

March 2010 was the first phase of CARM. That is in the critical path material that was provided at our trade committee.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Is that the ARL?

[Mike Leahy]

Yes, that is the ARL.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

That's the subsequent program to CARM.

[Mike Leahy]

It is the precursor to it. A revenue ledger is extended into CARM, but the language in the submission, you'll see, is both CARM and ARL. They're interchangeable.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Okay.

What I can't understand is the cost. What we heard from Mr. Gallivan is $370 million, but what we've also heard at committee is that you've spent $438 million. These two numbers are very inconsistent.

What actually concerns me the most is this: In a transition document prepared for the VP of the CBSA on July 31, 2021, it says that the costs are $371.5 million. Interestingly enough, nothing in the estimates or anything else adds up to that at that time point. In fact, you signed a contract on October 6, 2021, for $322,125,778.

Is this contract a result of verbal approvals that were given to Deloitte to do work and you had to then prepare a new contract with Deloitte?

[Jonathan Moor]

I might ask Mr. Leahy to respond with the details, but what I will say at the start is that the CARM project has been a long-running project. The first two elements of CARM have been delivered, so the agency revenue ledger has been put online.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

I know, but that doesn't answer my question.

The cost identified in the transition document to the VP on July 31, 2021, was $371 million. There's nothing in the estimates or supplementary estimates that adds up to that, but there is a contract on August 6, 2021, for $322,125,778.

It appears to me that this is creating a contract to deal with the overruns because there was a contract for Deloitte in 2018 for $32 million, which now appears to have turned into a $322-million contract a mere three years later.

Is this the result of verbal authorizations that had to be covered with a new contract?

[Jonathan Moor]

I'll say that we did not come to this committee prepared to answer questions on CARM. We're very happy to bring back the detailed information, unless Mr. Leahy can answer.

[Mike Leahy]

I can say definitively that it wasn't based on a verbal contract, if that was the question.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

It's about verbal approvals for work that led to the necessity of a new contract.

[Mike Leahy]

That is not the case.

I think the evidence that we'll bring forward from our trade committee will demonstrate the history and hopefully bring clarity to the question you raised about the lineage of the contract. That material is coming forward to committee.

[The Chair, Conservative, Kelly McCauley]

Thank you.

We now have Mr. Sousa, please, for five minutes.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Thank you, Mr. Chair.

Mr. Leahy, I'll just follow up quickly on CARM. When was it first developed?

[Mike Leahy]

The initial funding allocations came in March 2010.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

When was Deloitte awarded the first contract for the project?