Government Operations Committee on May 29th, 2023

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

That is super exciting—50%. Thank you.

It was brought up previously, but I want to once again bring up the $2.3 billion for professional and special services, including contract personnel. Of course, this is the second-highest dollar value of any federal entity after the Department of National Defence and the second-highest percentage of total spending.

Why is professional and special services spending so high at PSPC compared to other departments, please?

[Paul Thompson]

Thank you for that question.

There's a wide range of activity in the department, so that speaks to some of the high numbers. In particular, in areas like construction, as you can appreciate, when a building is designed—take the parliamentary precinct project—we don't have in-house architects or designers who would do that work. We do that on contract.

We spoke earlier about ship retrofit and repair. Again, those are contracted services. We have other maintenance services for our real property portfolio.

There's a wide range of activity that we, over many years, have done through contracts and not through the in-house activities of government. That's the main reason you'll see PSPC as having generally a pretty high number of professional services contracts.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Is there any expertise that you would hope to develop internally eventually, or in some cases is it not possible?

[Paul Thompson]

In some cases, the expertise is so specific and time limited that the best value is to get an outside expert in to do it. If you need a building designed or need particular expertise for an intensive period of work, the professional services contract is often the best way to go.

As I said, every public servant ought to be doing that analysis as to where the best value is for any given task that needs to be done.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

Thank you, Mr. Chair.

[The Chair, Conservative, Kelly McCauley]

Thanks, Mrs. Kusie.

Ms. Thompson, go ahead for five minutes, please.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

In April of 2023 a report from the Standing Committee on National Defence recommended that government rapidly increase the pace of development and deployment of clean and renewable energy sources for the Canadian Arctic in order to provide the clean energy necessary to support NORAD modernization and to supply local energy infrastructure needs.

Are you able to speak to how Defence Construction Canada has improved its green energy infrastructure expertise, as clearly would have been done in recent years?

[Paul Thompson]

Thank you for that question.

Unfortunately Defence Construction Canada is an arm's-length corporation with their own responsibilities, so I can't speak to their efforts. I do know that they're active in this area. They're making great strides not only in greening but also in indigenous procurement. They are one of the leading organizations in terms of indigenous contracting as well.

I can't comment beyond that. Perhaps my colleague Simon has something to add on Defence Construction in the work in support of DND.

[Simon Page]

Thank you for the question.

I don't have anything to add actually. All the relationships and the contracting through Defence Construction do not fall under the defence and marine portfolio of PSPC. We do monitor the projects with them, because many of the infrastructure projects complement the equipment projects, but that's about the extent of our relationship.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

Perhaps I could touch on the indigenous contracts in the 2023-24 departmental plan. In that, 8.3% of total contract values were awarded to indigenous businesses, exceeding the mandatory target of 5%. Are you able to speak to the major contracts that were provided to indigenous businesses?

[Paul Thompson]

The work continues to find as many opportunities as we can for contracting with indigenous organizations and to meet the 5% target. We have some very interesting success stories including, as you just mentioned, in work in the north. Our North Warning System sustainment contract of over $500 million was issued to an indigenous owned and operated company, so that's one example of a large opportunity that was found. Work in the rest of the government continues.

We have three phases of implementation of the reporting requirement on the 5%, and we're in the midst of the first phase right now. Some departments, I must say, are doing better than others and there are some commodity areas in which the government is more successful. Shared Services Canada is one organization that is doing quite well in the IT space in terms of indigenous procurement.

Sony, I don't know if you want to add anything on that.

[Sony Perron]

Yes. Thank you for the question.

Because digital economy is a growing business, we see more and more indigenous businesses coming and making offers in the sector. At Shared Services Canada, when we are establishing new procurement vehicles in some areas, we will deliberately create what we call an indigenous set-aside. We will have a master vehicle to procure a certain type of product or service with Canadian businesses or with businesses in general. We will have another stream that is specialized for indigenous businesses trying to leverage the capacity to develop the various indigenous groups in Canada to occupy that space.

We have been doing well with 6.3% of the value in 2021-22 and 7.8% of the funded contracts. This is progress. I think there is more potential than that, so we need to continue to make our procurement needs clear so there will be more indigenous business interest.

We have also written to our 15 largest vendors and partners to let them know that we have some social objectives we want to achieve and to invite them to think seriously about their own indigenous procurement to create the industry out there that will support them and become available so Canada can procure directly from indigenous businesses.

In the areas of procuring hardware, equipment and professional services, we have seen growth with indigenous businesses in Canada.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

That certainly is very positive. We've heard often in committee about the importance of moving to a digitalized government, and it's so helpful that you've exceeded the targets with indigenous groups, which is incredibly important.

In the 2023-24 departmental plan the government has said it would like to improve results for Canadians by supporting departments and agencies to effectively implement outcome-based policies and program approaches in key priority areas such as public health and climate action. Can you describe some of these initiatives?

[The Chair, Conservative, Kelly McCauley]

Very briefly, or perhaps in writing...?

[Paul Thompson]

Mr. Chair, I've spoken to the greening initiatives at some length already, with a 57% reduction of our carbon footprint already, the district heating and cooling in the national capital region and regional energy certificates. That's essentially the suite of greening investments that we have.

We're very active in other areas in making sure our buildings are accessible and meeting or exceeding the highest standards of accessibility, as well as working on other aspects of workplace inclusion and how buildings are designed. That's how I'd summarize it.

[The Chair, Conservative, Kelly McCauley]

Thanks, Mr. Thompson.

Ms. Thompson, are you fine with that? Would you like anything tabled to the committee?

[Joanne Thompson, Liberal, St. John's East, NL]

No. That's perfect. It's just nice to have it on the record.

Thank you.

[The Chair, Conservative, Kelly McCauley]

Thanks.

Just before you go—thanks for being with us—I have a couple of quick questions, if you don't mind.

Ms. Vignola was asking about the P-8. We've heard the comment “at this time” repeated often. I'm just curious. If “at this time” the contract was signed based on what the RCAF specs were as provided, when would the first plane be delivered to DND or the RCAF?

[Paul Thompson]

That's a little bit speculative, I think. Since we're in discussions on option analysis right now, it's hard to pin down—

[The Chair, Conservative, Kelly McCauley]

That leads into a second question. When we talk about “at this time”, it could be two years or five years before we could work with something to get a deal signed and a plane produced and delivered to Canada. Would that time then allow other companies, perhaps a Bombardier or someone—I'm not pushing for them—or perhaps another company to bid and have a project that would meet the specs?

[Paul Thompson]

I don't know if there's anything Simon wants to add, but I would just note that the requirements we were given had some urgency in terms of needing an aircraft to meet those specifications now, and there's quite a difference between the off-the-shelf timeline associated with the P-8 and a developmental solution.

[The Chair, Conservative, Kelly McCauley]

If there is an urgency, when, then, would the RCAF expect to receive the P-8 if it is as urgent as you just commented?

[Paul Thompson]

It is an existing aircraft in production.

I don't know, Simon, if there's anything we can add for the committee's benefit on the availability of that aircraft.

[Simon Page]

The only thing I would add would be that this is part of the information-gathering process that we're conducting now.

On your second question—about knowing if a developmental option would be faster than the current option—this is a request for information in the information-gathering process that we're doing at this time. To back up my deputy minister's comment there, it remains quite a bit speculative. We're just making sure right now that we have all of the information to make sure the right decision can be put forward.

[The Chair, Conservative, Kelly McCauley]

Thanks so much for your answer. I appreciate that.

We are going to excuse you. Thank you for joining us.

Colleagues, we're going to suspend to allow them to leave. We do have to get to the estimate votes. It should not take that long. I'm going to suggest that we suspend for about two minutes to allow these folks to leave, and then I'll accept, if we can have unanimous consent, to continue.

I have Mr. Barrett.