Evidence of meeting #31 for Government Operations and Estimates in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was contracts.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Emilio Franco  Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat
Mollie Royds  Associate Assistant Deputy Minister, Procurement Branch, Department of Public Works and Government Services
Patrice Nadeau  Assitant Deputy Minister, Networks and Security Services, Shared Services Canada
Kim Steele  Assistant Deputy Minister and Chief Information Officer, Digital Services, Department of Public Works and Government Services
Samantha Hazen  Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch, Shared Services Canada
Ron Cormier  Director General, Business and Technology Solutions Sector, Department of Public Works and Government Services
Clerk of the Committee  Mr. Paul Cardegna

12:30 p.m.

Conservative

Kelly McCauley Conservative Edmonton West, AB

Sorry, let me interrupt you there.

When we talk about fairness—I look at PSPC—a lot of the commentary today is, well, we have a fair, transparent bidding process. I'm arguing that lots of these contracts shouldn't even get to a bidding process. There's a real disconnect between me, I think, and what my colleagues opposite are saying. A lot of these contracts perhaps shouldn't even be getting to that bid. It almost seems that the feedback we're getting is, well, it's okay because we're fairly giving Deloitte a quarter of a million to tell us not to buy sensitive security equipment from despotic regimes.

How do we move forward so we're not putting forward such—I'm going to be blunt—wasteful outside contracts? I don't care if they're fairly awarded to Deloitte to tell me not to buy from the dictatorship of the Communist Party. How do we get to not sending out so many contracts? Does that need to start with the Treasury Board? Does it start with education to every single department?

12:30 p.m.

Associate Assistant Deputy Minister, Procurement Branch, Department of Public Works and Government Services

Mollie Royds

Mr. Chair, thank you for the question.

I think in these instances it would be the individual departments that are responsible for establishing the requirements that PSPC conducts the procurement processes for. Certainly, they are responsible for ensuring that they have a business requirement, and they make a business decision around critical services for delivery of programs to Canadians. Again, we have established.... Sorry, I don't want to repeat the rationale behind our—

12:30 p.m.

Conservative

Kelly McCauley Conservative Edmonton West, AB

Why don't we pop over to Mr. Franco with the Treasury Board?

It's the same question. How do we stop the train before it becomes a runaway train? How do we stop bad contracts or wasteful spending going forward? Again, is it just to leave it solely to departments? That's not happening.

12:30 p.m.

Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat

Emilio Franco

Thank you for the question.

An element of our procurement policy is that procurements must be delivering a best value for taxpayers. That's an important element of what we have. I think we've reiterated quite heavily here that the decision for the majority of procurements rests with the deputy head of that organization.

12:30 p.m.

Conservative

Kelly McCauley Conservative Edmonton West, AB

That's probably not working, so how do we go forward? How do we fix that?

I don't believe that's working. I have hundreds and hundreds of examples from the order paper question. One of them came back...656 pages of contracts, with about 15 contracts per page. This is solely for consulting company contracts, not for nurses or cleaning.

How do we ensure that? I don't believe leaving it to departments is working, do you?

12:30 p.m.

Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat

Emilio Franco

Thank you for the question.

If you've brought forward particular examples and specifics of contracts that you would like to investigate, you may be interested in inviting the particular departments responsible for those contracts and those decisions to speak to the decisions they may have made.

12:30 p.m.

Conservative

Kelly McCauley Conservative Edmonton West, AB

Okay. Thank you.

12:30 p.m.

Conservative

The Chair Conservative Robert Gordon Kitchen

Thank you.

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

October 3rd, 2022 / 12:30 p.m.

Liberal

Parm Bains Liberal Steveston—Richmond East, BC

Thank you, Mr. Chair, and thank you to our guests who are here today.

My first question is for all of the departments. Is there a specific set of criteria that must be met before you consider outsourcing, or does each consideration merit its own criteria?

12:30 p.m.

Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat

Emilio Franco

Thank you for the question.

I would say, from a broad perspective, I'm not familiar with the policy that sets out a particular criterion or set of requirements, but perhaps our colleagues in Shared Services Canada or PSPC may want to speak to the particular decision-making that they do in their individual make-or-buy decisions.

12:30 p.m.

Assitant Deputy Minister, Networks and Security Services, Shared Services Canada

Patrice Nadeau

Maybe I can start from a Shared Services point of view.

It is on a case-by-case basis for us. With respect to the decision leading to whether or not we outsource, we follow a pretty robust process internally. All options are always being looked at with a focus, obviously, on best practices, our own capacity, whether there is an existing solution in place and whether or not we can build and operate in-house. Our preferred delivery method has always been to take advantage of the internal resources first.

The right decision process, combined with the right balance between government employees and consultants, especially in the IT field, so far, I think, has actually led to the best value in delivering IT services to our clients.

12:35 p.m.

Liberal

Parm Bains Liberal Steveston—Richmond East, BC

Are there any guidelines or incentives for buying services from Canadian enterprises? How do you foster Canadian industry through contracting?

12:35 p.m.

Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat

Emilio Franco

Thank you for the question.

As was mentioned, the procurement policy highlights and encourages, in fact, broader considerations for socio-economic and environmental considerations within procurement. This means that departments are actively encouraged, under the Treasury Board's policies, to look at how they can incorporate manners and approaches that will allow the participation of, particularly, small and medium-sized Canadian enterprises in the procurement process. For example, there are requirements to unbundle so that smaller companies can participate in individual requirements, rather than bringing something together that allows only large multinational companies to participate.

This is something we've taken an active policy position to support, and I know that a number of initiatives and programs are in place, particularly within Public Services and Procurement Canada, regarding social procurement, which they may wish to speak to.

12:35 p.m.

Liberal

Parm Bains Liberal Steveston—Richmond East, BC

Okay. Thank you.

This question is for Shared Services. Canadians rely on the digital services provided by their governments. Can you please share with us why we need to work with our global partners in order to protect Canadians and their personal data?

12:35 p.m.

Assitant Deputy Minister, Networks and Security Services, Shared Services Canada

Patrice Nadeau

Actually, the vast majority of our contracts are with Canadian companies, including small and medium-sized enterprises, but taking advantage of the private sector is key for us. A number of our key services allow us.... Again, we have no choice but to leverage capacity and the nimbleness of the private sector and rapidly adopt an innovation solution, typically at lower cost for Canadians.

We have a combination of both, but the vast majority are Canadian-based. When we outsource a turnkey solution that includes the hosting of data, for example, it is a must. It has to stay on Canadian soil. This is specified in many of our contracts.

In other cases, we have no choice. We also have partners right around the world. We are actually managing 200 locations connected to our network that are outside of Canada—all of the missions and embassies around the world—so we do have contracts in place, obviously, with service providers outside of the country.

12:35 p.m.

Liberal

Parm Bains Liberal Steveston—Richmond East, BC

Why is that sometimes necessary? Why do we have to do that?

12:35 p.m.

Assitant Deputy Minister, Networks and Security Services, Shared Services Canada

Patrice Nadeau

Well, it is obviously the only solution available most of the time, especially when it comes to networking. For example, if we're in a specific country, it's not a Canadian company that will be able to deliver the infrastructure required outside this country.

We typically have a lead organization, a Canadian-based organization. The best example is probably the contract we have in place for the international network, which is provided by a number of companies around the world but the main contract is with Bell Canada. Bell would act as the integrator on our behalf and ensure that service-level agreements are met and that our security controls are being met with all of those organizations around the world.

12:35 p.m.

Liberal

Parm Bains Liberal Steveston—Richmond East, BC

I have another—

12:35 p.m.

Conservative

The Chair Conservative Robert Gordon Kitchen

Thank you, Mr. Bains.

We'll now go to Mr. Lobb.

12:35 p.m.

Conservative

Ben Lobb Conservative Huron—Bruce, ON

Thanks very much.

The first question is for Public Services and Procurement. It's just a general question, and it's in regard to the National Capital Commission and some of the work it's doing in the parliamentary precinct here, the redevelopment. I don't think I've ever really had a good answer to it.

This is a world where it seems like people will not be going to the office as much as they did in the past. There is this big redevelopment project that was announced in the last number of months to add, I think, close to 200 office spaces here just on Wellington and Sparks. Did anybody ever look at that and say, “We already have probably 500 too many office spaces downtown. Maybe we need to redevelop it, but we don't need to add another 150 office spaces”? Do your information and your data show that we're short on office spaces or that we have a surplus of office spaces downtown here?

12:40 p.m.

Associate Assistant Deputy Minister, Procurement Branch, Department of Public Works and Government Services

Mollie Royds

I'm afraid that, as the associate assistant deputy minister for procurement, I'm not responsible for the office portfolio. My colleague, the chief information officer, is not either, so we're not in a position to answer that question. It would have to be other colleagues of ours from within the portfolio.

12:40 p.m.

Conservative

Ben Lobb Conservative Huron—Bruce, ON

Would that be something we could have followed up, do you think? Would that be something you folks would be able to get back to the committee on?

12:40 p.m.

Associate Assistant Deputy Minister, Procurement Branch, Department of Public Works and Government Services

Mollie Royds

I can certainly take the question and come back with a response for the committee, yes.

12:40 p.m.

Conservative

Ben Lobb Conservative Huron—Bruce, ON

Okay, thank you.

I want to go back to the question on some of the professional services with Deloitte, KPMG, Ernst and Young, and PricewaterhouseCoopers. There's a pretty long list of professional services they provide. Many of them, I would suggest, are not mission-critical. They amount to tens of millions of dollars. Is there an initiative out there to review all these professional services contracts that are let to these companies and to really find out if they are mission-critical or just nice-to-have?

I see one on the list that's about doing a workshop. It seems like an endless list of expensive things. Maybe they're only $10,000 or $20,000, but they somehow manage to add up to tens of millions of dollars.

It's fine if nobody wants to answer. I don't blame you.

Well, here's another one. I'll just throw this one out there. Is it a conflict of interest to have accounting firms come in to advise CRA? I'm asking Procurement, Treasury Board or anyone else. Is it a conflict of interest to have them come in and consult with CRA on how to conduct its business and then, on the other side of the table, they're the ones that are constructing contrived ways for corporations and wealthy clients to not pay taxes? Is that a conflict of interest? Is that something you folks have raised in your time in the public service?

12:40 p.m.

Executive Director, Procurement, Materiel, and Communities Directorate, Treasury Board Secretariat

Emilio Franco

Unfortunately, I can't provide an opinion on the particular question, but I would say no. Our policies related to procurement also reiterate values that are highlighted in the values and ethics code of the public sector. There are requirements, and there is a directive on conflict of interest that's also in place to help protect the integrity of our procurement processes.