Government Operations Committee on Nov. 21st, 2022

[The Chair, Conservative, Kelly McCauley]

I'm afraid, Ms. Boudreau, that we're out of time. Perhaps you can provide that to us in writing.

Mr. Johns, you have two and a half minutes, please.

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

Thank you, Mr. Chair.

Under vote 1b, there is over $5 million in funding proposed for the office of the chief information officer to support the governance and oversight of digital initiatives.

Last week, we heard from the chief information officer during our study of the ArriveCAN app. She spoke about Canada's digital ambition, which is intended to provide “modernized and accessible tools to support service delivery” in the digital age. This document contains an appendix of related policies and directives, but notably absent is the policy on title to intellectual property arising under Crown procurement contracts. Under that policy, IP developed through work on a Crown contract by default must be owned by the contractor, unless an exemption applies or Treasury Board approval is granted. The rationale provided for this policy is to enable the commercialization of IP by the private sector.

In a brief that the committee received from Professor Amanda Clarke, it reads, “This policy represents a clear recipe for ongoing lock-in to the vendors producing custom software for the government, reducing the departments' ability to share and reuse resulting software.” She recommended making Crown IP ownership the default.

If the government is going to be embarking on a mission to develop new digital tools, ownership of the IP needs to be an important consideration. An analogy of the current policy would be the government paying someone to build a house and then giving the builder the deed so that they can rent the house back to the government, and rent the basement too.

Will any of the funding proposed by the office of the chief information officer or in budget 2022 for the “comprehensive strategic policy review” be looking at this policy and the potential benefits of increasing Crown ownership of IP?

[Samantha Tattersall]

I'll start, and then I'll pass it to Paul.

For clarity, that policy is a policy of ISED. It is not a Treasury Board policy. That's important context.

Paul, I'll turn to you to speak about the efforts of OCIO.

[Paul Wagner]

Thank you, Mr. Johns.

One of the tenets and one of the digital standards that we have is developing the open.... There are opportunities when we can use open source, and we can work across departments and across industries, in fact, to develop software where the IP is out in the open and can be shared freely. That's one of our digital standards.

There are cases, though, where commercial software is what is required to deliver robust services to Canadians and Canadian businesses. It's finding that balance based on the type of solution that needs to be built. That's how we make those decisions.

[The Chair, Conservative, Kelly McCauley]

Thank you very much. That is your time.

We'll go to Mrs. Block for five minutes, please.

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

Thank you very much, Mr. Chair.

I want to ask a question that I think any one of you could answer.

Does the Treasury Board provide guidelines for government contracts on, for example, sole-sourcing?

[Samantha Tattersall]

I'll take that question.

In terms of sole-sourcing, it's very clearly defined in the government contracts regulations, section 6, the circumstances under which you can sole-source. They would be low value, an emergency, national security and then if there's only one provider.

There is broader guidance that we provide on our directive to the community.

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

Thank you very much.

During the pandemic, the government had a number of sole-sourced contracts. I understand, for the very reasons you just outlined, that those criteria were met for that sole-sourcing, but it drew a lot of public scrutiny.

For example, we've recently been looking at the ArriveCAN app and we learned that several sole-sourced contracts were provided to a small, two-person IT firm, which then subcontracted out the work. We have also learned that there is no way that parliamentarians have access to any of that information about those subcontractors. What this really means is that the government cannot be held accountable for how taxpayers' dollars are being spent.

The other thing we've learned is that by using a staffing firm, a large part, potentially one-third, of the cost of that contract is being paid to the firms. They've contracted other companies that do the work, and they're taking between 15% and 30% right off the top.

My question for the Treasury Board is this: What has the Treasury Board done in reviewing what's happened during the pandemic to address this issue? Why are you insisting on a process that covers up how taxpayers' money is being spent?

[Samantha Tattersall]

Just generally, going back maybe to your specific example, departments, deputy heads, are ultimately accountable for how they undertake their resources and how they decide to procure. If it's of a certain level, it will come into Treasury Board for oversight in the specific case.

The department had the authority, and they worked with PSPC and leveraged an existing procurement vehicle that PSPC had in order to act quickly at the time of the pandemic.

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

Who's responsible for that specific vehicle that they managed to leverage?

[Samantha Tattersall]

PSPC would have had a supply arrangement. As I understand, PSPC are here later this week, so you may want to put the question to them at that time. My understanding is that that was a supply arrangement they had in place, and that CBSA leveraged that supply arrangement.

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

Thank you.

How much time do I have?

[The Chair, Conservative, Kelly McCauley]

There's just over a minute left.

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

I want to go now to departmental results. We know they are an important part of informing parliamentarians as to whether or not they should approve spending plan requests without any sort of amendment. We've not seen departmental results. They haven't been published yet, so we don't know what the results are for this past year.

It is my understanding that Treasury Board has these reports and they have not been published. Why haven't these departmental results been published yet?

[Annie Boudreau]

Thank you for the question.

Indeed, we have received some of the reports you are referring to. Once we receive those reports, we need to do a thorough quality assurance on them. What we have noticed this year is that there are some discrepancies sometimes between the French version and the English version.

Another element that is very important to us is the format being used in order to produce those reports. I say it is important because it's coming from a recommendation from the 15th report of the Standing Committee on Public Accounts, whereby we were told that departments should be using the same templates to make sure it is easier for parliamentarians to be able to do their reviews.

We are still doing quality assurance on those reports, and we hope to be able to table them as soon as possible.

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

Thank you.

[The Chair, Conservative, Kelly McCauley]

Thanks, Mrs. Block.

Mr. Kusmierczyk, you're up again, please.

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

Thank you.

The PBO report identified that one of the largest items in the supplementary estimates is contingent liability. The report states that from 2016 up until now we've seen an increase in contingent liabilities of 224%. I just wanted to ask if you can explain what contingent liabilities are about. I also wanted to ask how that might relate to our government's commitment to walk the path of truth and reconciliation with indigenous communities in Canada.

[Annie Boudreau]

Thank you very much for the question.

I may tag with my colleagues here.

“Contingent liability” is an accounting term. As stated in the PBO report, if there is certainty that the Government of Canada will have to pay, and if the number that is used is greater than 70% and we are able to estimate the amount, then we should recognize a liability. That liability is recognized in the public accounts.

Once the liability is recognized, now it's a question of when and how that amount will be paid. When we have certainty on this, the department will come to Treasury Board, which will do their due diligence in terms of the money, in terms of making sure the implementation plans are accurate. Afterwards, that amount will be included in the estimates—either the main estimates or the supplementary estimates.

Thank you.

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

The second part of my question is this: How does that relate to, again, our government's commitment to working with indigenous communities and walking the path of truth and reconciliation?

[Annie Boudreau]

It is 100% a direct link. Every time we have an indigenous claim, the objective is to make sure that we are giving them the money we owe them. It could be for a specific claim. It could be an out-of-court settlement. It could be a land claim.

The goal is to make up for the mistakes of the past and ensure that these Indigenous communities receive the funding to which they are entitled.

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

In a lot of situations, these were long-standing land or legal claims brought against the Canadian government, and this government is working hard to resolve them with the indigenous communities. Is that a fair interpretation of where these funds are being directed?

[Annie Boudreau]

It is a fair interpretation. As you said, they come from the past. They are complex, and they're not always easy to estimate, hence my comment earlier about the lapsing money. We see in the public accounts 2021-22 that a lot of money has lapsed because a settlement has not been reached yet, but the money is protected there, and, when there is an agreement, we'll be able to pay for it.

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

We see an increase in contingent liabilities, an increase of 224% since 2016, since this government took office in 2015. We're seeing many more of those claims being resolved by this government. Is that fair?

[Annie Boudreau]

Yes, it is a correct statement.