Government Operations Committee on Oct. 30th, 2025

[The Chair, Conservative, Kelly McCauley]

Good afternoon, everyone.

Welcome to meeting number 12 of the House of Commons Standing Committee on Government Operations and Estimates, known of course worldwide as the mighty OGGO and also as the only committee that truly matters.

Colleagues, we have two ministers with us today. We're going to try to get them out on time. We will be very strict with our interventions for time, so please watch your clocks.

Ministers, you each have five minutes for an opening statement. In order to get you out on time, I will hold you to that five minutes as well.

Minister Lightbound, you are first. Welcome back. Please go ahead for five minutes.

[Joël Lightbound, Liberal, Minister of Government Transformation]

Thank you, Mr. Chair, for watching the clock closely. I have a plane to catch, and I don't think my wife would forgive me if I missed it.

I am joined today by Arianne Reza, deputy minister of Public Services and Procurement Canada, and Scott Jones, president of Shared Services Canada. I thank them both for being here with me today.

A few months ago, when Canadians elected our government, they sent a clear message: They want a government that spends responsibly, gets concrete results and protects essential services in the long term. That's exactly what we're doing. It's about facing challenges, making tough decisions, and laying the foundations of a more efficient and modern government, one that is better prepared to meet the needs of Canadians in a rapidly changing world.

Mr. Chair, we know that the world is rapidly changing. Geopolitical tensions are escalating. Technology is transforming our economies. Global trade rules are being rewritten right before our eyes. Given the context, Canada must be ready to act to protect its sovereignty, its economy, and the essential services Canadians rely on every day.

That is exactly the mandate I was given as Minister of Government Transformation, Public Works and Procurement: modernize government to make it more nimble, responsible and efficient.

We are modernizing government operations by streamlining systems, reducing unnecessary costs and focusing our resources where they matter most: direct services to Canadians.

To do this, we are using the same pragmatic, results-oriented approach we took in September for Canada Post: making necessary and sometimes difficult decisions to ensure that the essential services Canadians rely on every day remain reliable and sustainable in the long term.

A clear example of such transformation is GCtranslate, an AI-powered translation tool developed in-house by the translation bureau within my department. This innovation is helping federal departments process millions of words of official documents faster, more securely and at a lower cost, and it is reducing reliance on external services while strengthening the government's capacity to deliver in both official languages. It's exactly this kind of practical, results-driven innovation that shows Canadians their government is acting decisively to modernize operations and to deliver better services for them.

Federal procurement is one of the most powerful tools we have to drive opportunity and growth across the country. Every year, the Government of Canada purchases close to $60 billion in goods and services. PSPC and Shared Services manage more than three quarters of that spending, but today, the system can be slow and complex, and it doesn't always prioritize Canadian workers and businesses as effectively as it could.

That's why in July, the government implemented the interim policy on reciprocal procurement. This policy gives Canadian businesses a fair chance abroad when foreign companies bid on contracts in our country.

In September, we introduced the buy Canadian policy. This will ensure that government spending supports businesses here, creates good jobs and strengthens our supply chains.

This new policy will prioritize Canadian materials and suppliers, will simplify procurement processes and will make it easier for small and medium-sized businesses to work with the federal government through a dedicated SME procurement program, which will be launching soon.

Small and medium-sized enterprises represent 98% of Canadian businesses, employ over half of our workforce and generate nearly half of our GDP, but they remain under-represented in federal procurement. This program is a concrete step to change that, putting more opportunities directly into the hands of Canadian entrepreneurs, creating good jobs and keeping more economic value here at home.

As for defence procurement, in October, the government took the pivotal step of establishing the Defence Investment Agency, under the leadership of the secretary of state for defence procurement, Stephen Fuhr. This is a first in decades, and shows the government's willingness to act and modernize its processes.

This agency will accelerate procurement, eliminate duplication and support Canadian innovation. It will help local businesses scale up and compete globally, and give the Canadian Armed Forces the modern capabilities it needs to protect us.

There is also the national shipbuilding strategy.

One area where this work is already paying off is in the national shipbuilding strategy.

More than $36 billion in contracts has been awarded to date across the country, contributing $3 billion annually to our gross domestic product and supporting more than 21,000 jobs in Canada. This is creating real growth and real jobs, while demonstrating Canadian know-how.

We will continue to build on this success, so that other sectors and regions can also benefit from federal procurement. This will in turn strengthen our economic foundation and protect our sovereignty.

When it comes to digital sovereignty, economic strength and national defence are not the only pillars of sovereignty in the 21st century—

[The Chair, Conservative, Kelly McCauley]

I'm going to interrupt you there, Minister. We're out of time, unless you're going to stay past your allotted time with us. The choice is yours.

[Joël Lightbound, Liberal, Louis-Hébert, QC]

That's okay, Mr. Chair. I'm sure I'll have an opportunity to discuss certain topics when I answer my colleagues' questions.

Thank you.

[The Chair, Conservative, Kelly McCauley]

Minister Ali, welcome to OGGO. Please go ahead for five minutes.

[Shafqat Ali, Liberal, President of the Treasury Board]

Thank you, Chair.

Bonjour, tout le monde. Thank you for having me here today. This is my first time joining this committee. It's good to see new and familiar faces.

I’m here to talk about my priorities as the President of the Treasury Board. Let me begin by saying that none of this work happens without Canada’s public service employees. They deliver programs and services that people rely on every single day. Through you, Chair, I would like to thank them for building Canada strong.

To support these efforts, the Treasury Board Secretariat determines the rules and provides direction so that the government is well managed and Canadians are well served.

Let me start with the work we are doing on government spending. As this committee knows, every year, detailed spending plans go through the Treasury Board and then go to Parliament before any money is spent. One of our government’s key priorities is to spend less on government operations and invest more in priorities like housing, defence and infrastructure. That’s why the Minister of Finance and I launched the comprehensive expenditure review earlier this year. More than 100 departments have put forward proposals, and I look forward to sharing the results with you as soon as possible.

One of the many duties the TBS has is setting the rules for how departments are managed and how the government operates. We also lead the government’s digital work to make sure that our IT systems are reliable and deliver results for Canadians.

To help public service employees deliver results, the TBS is using artificial intelligence as a new and important tool for government. That’s why this year the TBS launched Canada’s first AI strategy for the federal public service. Our goal is to use AI responsibly to help people do their jobs better and deliver faster, more efficient services to Canadians.

To improve service delivery, Canada’s new government announced a 60-day red tape review. We identified close to 500 initiatives across federal organizations to remove overly complicated regulations, streamline and reduce costs for businesses. For example, we’re giving Canadians faster access to important medications by streamlining approvals from trusted countries. This change has already reduced wait times for some drug approvals by approximately five months.

We’re modernizing regulations for Canadian farmers. These changes will help Canadian farmers, make the government more efficient, and improve service delivery for Canadians.

In addition, we have launched a review of the Access to Information Act. This is being guided by feedback from stakeholders and parliamentarians like you.

We also continue to implement the Official Languages Act to promote and protect Canada’s official languages. Furthermore, we're updating the language designation of federal offices, which will result in 700 more offices across Canada becoming bilingual.

In closing, Mr. Chair, our goal at the TBS is clear: having a government that is transparent and accountable and that delivers results and quality services for Canadians.

I look forward to your questions.

[The Chair, Conservative, Kelly McCauley]

Thank you, Minister.

We will start our six-minute rounds with Mrs. Kusie.

Welcome back to OGGO. The floor is yours.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Chair. It's a pleasure to be back at the government operations committee.

Minister Ali, like many Canadians, I am very interested in seeing next week's budget. I'm particularly concerned that your government has abandoned your fiscal anchors. I will remind you that in 2024, in the fall economic statement, these anchors were (a) to maintain a declining debt-to-GDP ratio and (b) to uphold Canada's AAA credit rating. In the last few weeks, however, these anchors have seemingly disappeared.

In his September 25 report, the PBO stated, “Due to persistent budgetary deficits of over 1 per cent of GDP, the federal debt-to-GDP ratio is projected to increase from 41.7 per cent in 2024-25, rising above 43 per cent over the medium term” and that it is “no longer projected to be on a declining path”.

On our AAA credit rating, a Financial Post article from yesterday asks a clear question: “Does Canada still deserve its AAA...rating?”

Minister, I would argue that, as the PBO has stated, our debt-to-GDP ratio will be rising, and that the deficit will rise to a minimum of $68.5 billion. That is not a small number. That is without adding recent spending commitments from your government. It is valid to wonder, when your budget is tabled on Tuesday, if the reaction from the markets will be that Canada still deserves its AAA credit rating. I'm not convinced.

The Prime Minister refers to himself as a financial budget expert. However, based on reports from the PBO and from other economists, Canadians are having trouble seeing this.

Therefore, Minister, on Tuesday, when your government presents its budget, are you purposely wanting it to fail so that an election will be called before Canadians feel the true economic effects of your government?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

Chair, through you, I'd like to thank my hon. colleague for the question.

You know that this government has committed to balancing its operating budget over the next three years. In this context, the government is undertaking a comprehensive expenditure review to ensure that government spending is responsible and that it delivers results for Canadians. With that phased approach, over the next three years, organizations can put forward proposals where they can find savings, so we can find those savings and can invest in the priorities that matter most to Canadians. That is coming forward.

I think this question is related more to the finance minister, who will be presenting the budget on November. I believe this will be a generational budget. There will be investments in the Canadian Armed Forces, in infrastructure and in Build Canada Homes—

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

Minister Lightbound, last week, the Auditor General released yet another report that outlines that your government is failing when it comes to contracts.

On the CRA call centre with IBM, your government oversaw the ballooning of this contract from $50 million to $190 million, and results weren't even met for Canadians. Earlier this week, the department officials said that the government had learned a very hard lesson.

Minister, when Canadians make a typo on their tax filings, the CRA agent doesn't accept their pleas that they've learned their lesson. The CRA agent goes after them with the full weight of the federal government for the money owed. However, when it is your government that makes contract errors and doesn't validate invoices or scrutinize to ensure the money being spent is actually for a service provided, your department officials believe that learning a hard lesson is enough. On behalf of Canadian taxpayers, Minister, no, it's not enough.

Even worse, last week was not the first time the Auditor General had delivered this message. Your government has been consistently criticized by the Auditor General for the lack of scrutiny, validation and competition for multi-million dollar contracts.

In June, after tabling her audit on GC Strategies, the Auditor General was extremely clear that the government need only follow the existing rules on procurement and contracting. It's clear that your government throws value for money out of the window at every single opportunity, and instead, rewards its Liberal friends and insiders when developing contracts.

Minister, when will you and your government listen to the Auditor General and finally ensure your departments and agencies follow the existing external contracting rules?

[Joël Lightbound, Liberal, Louis-Hébert, QC]

I thank my colleague for the question, although I reject several of her assumptions.

I'll begin by saying that in her most recent report, published in June, the Auditor General clearly stated that the rules have to be followed. She did not make any new recommendations. She also acknowledged that my department implemented recommendations she'd made in previous reports. We implemented all the Auditor General's recommendations to ensure that government contracts are awarded in a transparent and competitive manner, and that taxpayers get their money's worth.

Regarding the Canada Revenue Agency, or CRA, contract—

[The Chair, Conservative, Kelly McCauley]

I'm sorry, Minister. We're past the time and I will have to cut you off. Perhaps you can finish with Ms. Sudds' intervention.

Please go ahead for six minutes, Ms. Sudds.

[Jenna Sudds, Liberal, Kanata, ON]

Thank you very much.

Absolutely, Minister Lightbound, if there's more you wanted to address from that first question, please take the time to do so.

[Joël Lightbound, Liberal, Louis-Hébert, QC]

That's very generous of you. There's a lot to say.

First, I need to remind everyone that the CRA contract my colleague referred to was awarded through a competitive process. It was agreed that the contract would cost $190 million over 10 years, and that's exactly what it cost. If my colleague would like our officials to give her a technical briefing on this particular contract, we'd be happy to do so. From where I stand, it is clear that taxpayers got their money's worth. There's no issue here.

I'd like to come back to my colleague's comment on Canada's fiscal situation. It's important to note that Canada has a AAA credit rating and the lowest debt-to-GDP ratio among G7 countries. The International Monetary Fund, or IMF, has even recognized Canada's approach. In fact, I'd like to quote the IMF managing director, Kristalina Georgieva.

She said, “In the case of Canada, the Canadian authorities have been very decisive to take action in the context of changing relations with their main trading partner.” As well, she said, Canada is focused on growth: “The areas that Canada identified, housing, infrastructure, energy...strategic projects. These are areas...[where] Canada can lift up productivity.” She added, “And then we have countries in the G7 that are in a better position. Germany and Canada stand up in that regard”.

That's why it's important to put things in context when it comes to Canada's fiscal situation. The current context means that Canada needs to invest to increase its productivity, reduce its trade dependence on the U.S. and increase its resilience. That's exactly what we're doing.

[Jenna Sudds, Liberal, Kanata, ON]

Excellent. Thank you very much for that fulsome response. Being able to get that on the record is amazing.

I want to go back to basics, that is, to simply reflect on the reality that the world has drastically changed, particularly over this last year. I think Canadians want to see us adapting to those changing circumstances.

Your title and the mandate you have include government transformation. Can you share what that actually translates to in the work you're pursuing day after day?

[Joël Lightbound, Liberal, Louis-Hébert, QC]

Thank you very much.

That's a good question.

Considering that public distrust of government institutions is increasing in Canada, and elsewhere in the west and in the rest of the world, it's obvious that the government needs to be more efficient. In fact, more and more of our fellow citizens believe that when it comes to government services, they're not getting their money's worth.

I think the government needs to be as efficient as possible if it wants taxpayers to trust its institutions. There are many ways to get there. The Prime Minister gave me a mandate, which I share with the President of the Treasury Board and the Minister of Finance and National Revenue. I see two ways of fulfilling that mandate, which is a collective effort. First, departments need to do a vertical review. All departments more or less began that process when they were asked to review their spending. They were asked to find ways to gain efficiencies within their respective organizations. That's the vertical part.

I work a lot with Shared Services Canada and Treasury Board, among others, to make sure we have tools, including the AI technologies a number of departments are using. I'm thinking, for example, of the translation tool developed by the translation bureau.

I'd like to give you some numbers to make this more concrete. The translation bureau recently created and deployed the tool, and it was implemented in five organizations this past June, namely Canadian Heritage, the Privy Council, the Department of Finance, the RCMP and my department, Public Services and Procurement Canada, or PSPC.

Since June, 95 million words have been translated using the tool. It is estimated that 465 million words will be translated within those five organizations and one other one.

Translation costs in the private sector vary between 15¢ and 40¢ a word. At the translation bureau, the cost is between 35¢ and 40¢ a word. Thanks to the tool, that cost drops to one cent a word. It allows translators, who do phenomenal work, to be a lot more efficient, since they just have to revise documents that have largely been translated.

You can imagine the efficiency and speed that can be gained by developing such a tool. Many of our colleagues in Parliament would like to have access to it to translate documents, and we're working on that. The results are very positive thus far.

That's just one example. There are many other tools that can be developed and deployed within government.

[The Chair, Conservative, Kelly McCauley]

You have 30 seconds.

[Jenna Sudds, Liberal, Kanata, ON]

Is there anything you would like to add, Minister, in our last 30 seconds?

[Joël Lightbound, Liberal, Louis-Hébert, QC]

I think that about sums it up. There is a lot to say, but I'm happy to see that the Prime Minister has big ambitions for the Canadian government. I think it's necessary.

[The Chair, Conservative, Kelly McCauley]

Madam Gaudreau.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Mr. Chair.

I've just learned, minister, that the translation bureau has adopted new rules. You should know that using conference interpreters in a hybrid Parliament has its limitations; we're talking about humans. I agree that using AI to translate documents or reports of three to a thousand pages can be effective.

Having said that, I want to point out that, according to the experts, these new measures put the health and safety of interpreters at risk, render employment insurance provisions meaningless and can aggravate the problems associated with acoustic shock. I think we need to be concerned about that. Furthermore, I have a hard time understanding why we would use the lowest bidder if we’re looking for quality service.

With all due respect, Minister, I'm asking you, a Quebecker and francophone, how we will get quality service when people who don't speak both official languages struggle as it is. I don't understand.

[Joël Lightbound, Liberal, Louis-Hébert, QC]

Thank you for your question.

First and foremost, I want to thank the interpreters, who do an exceptional job. As members from Quebec, we know how fundamental and essential translation is in Parliament. The same thing goes for all MPs across the country. I would therefore like to thank the interpreters, because they do a difficult and intellectually challenging job. Simultaneous interpretation is far from easy. I want to thank them and say hello to them.

With respect to the two issues you mentioned, the interpreters' health and safety are fundamental, and we'll always work in tandem with the interpreters to ensure that the equipment they use is adequate and that their health and safety are protected.

As for the lowest bidder, it should be noted that, under the new procurement process implemented, all interpreters must be accredited with the translation bureau, which ensures a very high standard of quality.

The deputy minister may have something to add about this. I know that a procurement contract is under way so we can only say so much, but I'm nevertheless going to give her the floor.

[Arianne Reza, Deputy Minister, Department of Public Works and Government Services]

Thank you for your question.

I want to clarify something. For the moment, we're working on launching the offer, which is really focused on the quality of the interpreters. So there will be no change in that area, because the quality will not go down. We're in the process of determining the best way forward so that we have access to enough quality interpreters.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

The pre-hiring quality criteria for interpreters are no longer part of the current rules, even for freelance interpreters. I'd like to have more information on that, because I'm very concerned about the quality of interpretation. If both official languages are very important, this part of the budget will certainly not be cut.

My other question is about the Defence Investment Agency. This new organization is part of Public Services and Procurement Canada.

Modernizing is a good thing, of course, but I'm trying to understand one thing. We're talking about responsibility, but we're asking an agency to do the work for us.

For our part, we need to know about the contracts. Where's the transparency? It all seems murky.

Who decides what?

[Joël Lightbound, Liberal, Louis-Hébert, QC]

First, you have to understand why we're putting forward the Defence Investment Agency. Parliamentarians from all parties have been calling for this for years, I would even say decades.

It should be noted that this process also exists in other countries. They have an agency or department dedicated to military procurement. It's because procurement takes far too long and is far too complex. Historically, there have been a number of failures or slowdowns in military procurement, and these delays have costs.

Right now, military procurement is a three-headed beast: the Department of National Defence, Public Services and Procurement Canada and the Department of Industry. Coordination between these three departments without a single point of contact causes considerable delays, and these delays have costs.

Having everything under one roof shortens the time it takes to obtain supplies and gets better prices. It's also important to make sure we have a good connection between our capabilities, defence needs and what Canadian industry can provide. I'm thinking here of Quebec companies like Bombardier and CAE. If there's some predictability for military procurement, the industry will be able to develop based on defence needs.