Government Operations Committee on Oct. 3rd, 2022

[Gord Johns, NDP, Courtenay—Alberni, BC]

Yes, great. Maybe someone can speak specifically to this contract, because this amount of money seems outrageous.

I know that between 2010 and 2015 the government of the day made significant cuts to the public service. I guess the other question is, has that caused an increase in outsourcing? If so, has that ultimately caused an increase in costs associated with procurement?

Maybe Ms. Royds can speak to that.

[Mollie Royds]

Thanks very much for the question, Mr. Chair.

I'm afraid I'm not able to speak to the specifics of that particular contract. It is possible that it might be within the authorities of a particular department.

As the common service provider, we're responsible for the procurements that exceed an individual department's own authorities. That's when PSPC would be responsible for the procurement. Without knowing the details of that particular one, it is possible that it would be within the authorities of that specific department.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Ms. Royds, can you speak to the comment I made that there were significant cuts to the public service between 2010 and 2015? Has that caused an increase in outsourcing and, therefore, actually an increase in overall costs for the work that needs to be done?

[Mollie Royds]

Again, thanks very much for the question.

In terms of speaking to any particular trend, I'm not in a position to speak to a particular trend.

Again, as the common service provider, we are responsible for managing the procurement processes associated with the requirements of our particular departments. We do support particularly in the IT space.

As my colleagues from PSPC and Shared Services Canada have indicated, we support a number of technology projects and transformation projects that are being undertaken at the moment by the government, which do require us to seek the services and specialized skill sets of a range of contractors to support the work that is being undertaken, but I am not able to speak to any particular trend.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you.

In 2019, the HUMA committee adopted a unanimous report on precarious work. That was the result of a study required by a PMB put forward by the Liberal member for Sault Ste. Marie. That required, among other things, that the federal government stop using temporary help agency workers and work with ESDC and other government departments to properly staff government services using permanent employees.

The federal government, shamefully, is the country's largest user of precariously employed workers, who are subject to the whims of temp agencies. This report was never addressed by the government, as an election immediately followed.

What steps are you taking to ensure this recommendation is met in an expedient manner? I'm sure someone can answer this.

[Samantha Hazen, Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch, Shared Services Canada]

I can go ahead. Thank you, Mr. Chair, for the question.

At Shared Services Canada, as my colleague Mr. Nadeau mentioned, our employees are our greatest assets. As such, the department has been investing in growing our workforce over the past five years.

We are, indeed, working towards reducing the reliance on temporary help and increasing support through our employees. We have increased our employees over the past five years from just under 6,000 to now just under 8,000 federal workers at Shared Services Canada.

[The Chair, Conservative, Robert Gordon Kitchen]

You have 10 seconds.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you. I'll add it on next time.

[The Chair, Conservative, Robert Gordon Kitchen]

We'll now go to Mr. Lobb for five minutes.

[Ben Lobb, Conservative, Huron—Bruce, ON]

My first question is for Ms. Royds.

You mentioned in your opening comments the 5% goal for indigenous. In the last calendar year, what percentage did you achieve?

[Mollie Royds]

I'm afraid I do not actually have that number immediately at hand, but I would be very happy to provide that.

In terms of the 5% target that has been established by the government, this was put in place as a policy of government in April, so each individual department is responsible for reporting its progress against that particular target.

PSPC as a department, of course, is in the first phase of departments that will be reporting that. I know we will be reporting at the end of the year for that particular number. I would have to see if there is anything we have for the department from the previous year that we could make available to the committee.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Okay, that's good.

Can anybody on the panel tell us, of all the contracts that are let in a year, or over the last number of years, what percentage actually come in at the quoted price? Are there any? Or are they all adjusted after the quotes come in?

Can anybody tell me that?

[Mollie Royds]

Perhaps I'll start, and then my colleagues, if they wish, can add on.

I'm not aware that we track in that manner, Mr. Chair, but we do have a process where our technical authorities, which would be our client departments, are responsible for the business cases and the cost estimating that is undertaken, which is consistent with the Treasury Board directives and policies. Then, at PSPC, we manage the procurement processes, which we mostly will do, obviously, on a competitive basis—

[Ben Lobb, Conservative, Huron—Bruce, ON]

Sorry to interrupt, but wouldn't that be one of the key performance metrics in your whole department, the percentage? A lot of these contracts are very complex, very detailed, very precise. They're many pages long—we've seen them all—and you're telling me that nobody at the end tracks whether, if a project was quoted for $5 million, it came in at $5 million.

Is that what you're telling me?

[Mollie Royds]

I am not aware that we would track it, certainly as PSPC, as a common service provider. This would be something that an individual department would be responsible for, in terms of owning the requirements and the estimates. I'm just not able to speak to that more broadly.

Emilio might be able to speak to it from a TBS policy perspective, because as I indicated, the cost estimations are in line with the directive.

[Emilio Franco]

Thank you, Mr. Chair, and thank you, Mollie.

The Government of Canada has approximately 400,000 contracts and amendments each year. I would say, anecdotally, that the majority of them are simple and straightforward requirements where I would expect the quoted price matched the final contract value.

There are a number of complex procurements that are conducted by the Government of Canada every year. These procurements are complex in their nature. Often the deliverables or the final outcome is uncertain and there is an evolution in collaboration with the contractor to achieve a result. It is difficult to then assess whether the increase in contract value is the result of the activities that are engaged in with the contractor to ultimately solve a problem, or whether it is an increase from the originally estimated quote.

As Mollie mentioned, that is not information that the Government of Canada tracks at the granular level. We can say that the information is typically publicly disclosed through proactive disclosures where all contract amendments over $10,000 are made publicly available on the open government portal.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Okay.

I have six seconds. It seems like plenty of time to get right into the meat of all these issues and topics. Maybe next year....

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Mr. Lobb.

We'll now go to Mr. Jowhari for five minutes.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you, Mr. Chair, and thank you to all the witnesses.

My question is for Ms. Royds.

Ms. Royds, in your opening remarks you said, “The department buys, on behalf of other federal organizations, some 24 billion dollars' worth of goods, services and construction each year from nearly 10,000 suppliers.” You also indicated that about 88% of those are from small and medium-sized businesses.

Also, I understood from your opening remarks that you work with SSC to procure IT services. Within the IT services, you talked about access to specialized knowledge, knowledge transfer and dealing with some surge of the services.

IT consultants are easily the largest group of professional services that the government contracts externally. Can you explain why and what types of services are actually being outsourced?

[Mollie Royds]

Thank you for the question, Mr. Chair.

At PSPC, as a common service provider we are responsible for managing the procurement processes on behalf of our client departments. They are responsible for establishing the requirements of the individual procurement. They tend to do so for a variety of reasons, such as, in particular, when specialized skill sets are being sought to support a particular project or initiative, when surge capacity is required, when we need independent external advice or when we are lacking the expertise within an individual department.

Again, we are doing this on behalf of other government departments across the Government of Canada, so our role as a common service provider is then to manage those particular procurements.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

You were quite clear in your opening remarks that the decision to make or buy, which is often referred to as “outsourcing”, is made by the client. I assume your client in this case is Shared Services. Is that correct?

[Mollie Royds]

Actually, the client could be any of our government department clients, including Shared Services.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Can you tell me which client right now is spending the largest share on outsourced IT services?

[Mollie Royds]

For that particular question, I'm afraid I do not have that information immediately at hand for IT services. Of course, there is a range of services that we procure at PSPC. I would have to come back to the committee in writing with that particular piece of information.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Can you please do that? Thanks.

I would be very interested to know how IT services are broken down by department and by the services. I understand you're not making decisions, but you're making the procurement and I'm sure you have measures in place.

I have about a minute and a half.

You mentioned that the transfer of knowledge is one area of IT services. I'm not sure whether I should ask you or Mr. Nadeau at SSC. I'll ask the question and hopefully one of you two can answer.

The Professional Institute of the Public Service of Canada has suggested that for IT contracts, there is no mechanism to transfer knowledge and expertise back to the departments and agencies after a project is finished. You said that one of the elements of IT services is transfer of knowledge. Is this actually the case, and is it always the case?