Government Operations Committee on May 1st, 2024

[Arianne Reza]

That is one of the ones that we did not accept. In paragraph 110, where there is this collective overview, we have views. First off, PSPC doesn't figure prominently in this area. We have one contract of under $25,000, where we have comments.

Changing procurement strategies is okay.

I go back to your initial question, Mr. Chair, about what Canadians would say.

I think there's a balance as well in making sure we're optimizing the procurement system in a way that's efficient, fair, open and transparent to make sure that we're putting the right tool in place to be able to execute and deliver on services. There's a balance—I'm not suggesting one way or the other—but it's okay to change procurement strategies. We often challenge when clients come to us and say, “This is going to be sole-sourced.” We say, “No, you have to compete. Are you sure there's not anybody else who can do it?” It's okay to change an ACAN.

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

But you must accept the perception.... When there's communication back and forth with the vendor that seems to lead to a change in procurement practice, it creates a strong perception that things are being adjusted to meet the needs of a particular vendor. This is the finding here. It's exactly what we saw with ArriveCAN. In talking with the procurement ombudsman, he says that this is a systemic problem throughout government procurement.

[Arianne Reza]

I'll quickly—

[The Chair, Conservative, Kelly McCauley]

I'm afraid that is our time. We are going to suspend to allow members to vote.

We will be back in probably 15 to 20 minutes.

[The Chair, Conservative, Kelly McCauley]

I call the meeting back to order.

We have four more interventions, and then I need about five or 10 minutes.

Go ahead, Mr. Brock, for five minutes.

[Larry Brock, Conservative, Brantford—Brant, ON]

Ms. Reza, over a year ago—in fact, on February 22, 2023—this committee received a letter from your assistant DM of policy planning and communications, Mr. Ieraci, concluding the first tranche of documents that had been ordered by this committee. In that letter, your department promised there would be more documents to come, and that a second tranche would arrive well over a year ago—by March 3, 2023.

Who directed your department not to provide these documents to the committee within that time frame?

[Arianne Reza]

I believe the work is still under way. There are about 20,000 to 40,000 pages that need to be translated and collated, and the minimum redactions are being done. I believe they're on their way to you.

[Larry Brock, Conservative, Brantford—Brant, ON]

Didn't you see fit to update this committee?

[Arianne Reza]

I apologize. I should have started with that.

[Larry Brock, Conservative, Brantford—Brant, ON]

Can we have another tranche of documents delivered to this committee within three weeks?

[Arianne Reza]

I will do my utmost to do that, yes.

[Larry Brock, Conservative, Brantford—Brant, ON]

You referred three IT companies to the RCMP regarding fraudulent contracting, with a value of close to $5 million and in a time frame of 2018 to 2022.

What are they?

[Arianne Reza]

For precision, they're actual resources, so they're the consultants or the IT specialists who—

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you for that, but who are they?

[Arianne Reza]

I'm going to have to turn to Madame Poulin, who has the oversight.

[Larry Brock, Conservative, Brantford—Brant, ON]

Madame Poulin, tell us the identity, please.

[Catherine Poulin]

Thank you for the question.

As the deputy minister said, these are individuals. The names have been forwarded to the Royal Canadian Mounted Police, or RCMP. To preserve the integrity of its investigation, we prefer not to give the names of those resources to the committee.

[Larry Brock, Conservative, Brantford—Brant, ON]

GC Strategies is subject to an RCMP investigation, and an argument could have been made to preserve its integrity. There is still a presumption of innocence. People get identified every single day in this country when they're charged with a criminal offence.

I'll ask you again. Will you identify those three IT companies that have been referred to the RCMP?

[Catherine Poulin]

I will consult internally and see what we can do in order to provide those names.

[Larry Brock, Conservative, Brantford—Brant, ON]

Can you provide some context on the size of those companies? At this point, there's GC Strategies, a small, two-person company fleecing Canadian taxpayers for close to $60 million, all the way to McKinsey, the largest strategy consulting firm in the world, with 30,000 consultants across 65 countries. Again, they're potentially under RCMP investigation.

What are the sizes of the companies under investigation now?

[Arianne Reza]

I'd like to respond to that question, if I may.

For clarity, these are individuals. This would have come to light because of an individual working for two different companies and charging the Crown for the same time. It's not really about the companies at this time; it's about the individual consultants working. Those names have been referred to the RCMP for criminal proceedings.

I'm going to stop here and swivel for a moment—

[Larry Brock, Conservative, Brantford—Brant, ON]

About a month ago, we heard from your minister, Minister Duclos, and Minister Anand that this was only the first tranche of potentially fraudulent activity against the Canadian taxpayer.

How many waves or tranches can the Canadian public expect to hear about?

[Arianne Reza]

First of all, this is a new data analytical capacity, so it's going to be—

[Larry Brock, Conservative, Brantford—Brant, ON]

I'm not concerned about that, Ms. Reza.

The question is very specific. How many other tranches or how many other waves of further criminal investigations can we expect?

We got the impression from your minister and Minister Anand that there was going to be a review of all the contractors who were potentially subject to investigations by the RCMP and the Auditor General.

We know there are 635 similar IT middlemen operating in the same capacity as GC Strategies. Are all of those 635 IT middlemen being investigated for potentially fraudulent activities?

[Catherine Poulin]

Thank you for the question.

As was already mentioned, the investigations are aimed at individuals who have multiple contracts with several firms. At the end of March, we also announced that we would be increasing our data analysis.

We will likely obtain other results about those individuals, i.e., consultants hired by primary contractors who could at the same time bill the federal government for work done under numerous contracts.