Thank you.
Thank you, Mr. Chair.
Thank you, members of the committee, for inviting me here today. I'm here with Mr. Emilio Franco, the executive director at the Treasury Board of Canada Secretariat.
I'd like to provide an overview of Treasury Board's role with respect to the Defence Investment Agency, which is a new special operating agency within Public Services and Procurement Canada.
First, allow me to provide a brief explanation of the role of special operating agencies, or SOAs. These agencies are not a new concept. They include well-established organizations, such as the translation bureau and the Canadian intellectual property office. Today, more than a dozen special operating agencies are in place within the government.
Special operating agencies, or SOAs, are not legally separate entities but are established as distinct units within an existing federal department. Importantly, they are subject to the same rules and requirements that apply across the federal government. Sometimes, SOAs will be granted particular authorities, policy exemptions or delegations that allow them to operate with greater flexibility in order to more efficiently execute on their mandates. For example, the Canadian Coast Guard has the authority to enter into sole-sourced contracts above normal limits to deal with emergency situations.
The Defence Investment Agency is one of the government's newest SOAs. As announced by the Prime Minister in early October, its mandate is to consolidate and accelerate defence procurement processes while also tying procurement to domestic industrial benefits. The establishment of the DIA and the authorities granted to it build on previous efforts to streamline Treasury Board's involvement in defence procurement while focusing on the areas of highest risk and maintaining a strong oversight role.
Since 2018, defence procurements have been subject to a risk-based approach, permitting low-risk and, more recently, medium-risk defence procurements to proceed without seeking Treasury Board approval. Underpinning this approach is a rigorous and mature governance in which the Treasury Board Secretariat is involved, as well as strong due diligence. An evaluation undertaken in 2024 of the risk-based approach found that this approach effectively decreased procurement timelines without compromising the integrity of the process.
The authorities granted to the Defence Investment Agency represent a further iteration of this approach. For high-risk defence procurements of any value, Treasury Board approval of a procurement and negotiating strategy will be sought in advance of proceeding with solicitation activities or negotiations and, barring deviations from the approved approach, the agency will have the authority to enter into contracts without returning to the board.
I should emphasize that this exceptional authority is specific to contracting. Other types of authorities, like project authorities or access to funds, will still require Treasury Board approval. To support transparency, this enhanced authority is publicly available on our website in the directive on the management of procurement, as are all other exceptional limits.
Mr. Chair, we've provided a copy of this enhanced procurement authority to committee members to assist with your study.
On the topic of transparency, members will be interested to know that the Defence Investment Agency, like all departments and SOAs, is required to report publicly on whether its programs are achieving the intended results. This includes regular reporting, for example, through PSPC's departmental plan and departmental results report. Further, its contracts will be subject to proactive disclosure, and its spending will be captured in the public accounts, so anyone interested can follow the plans, procurements and spending of the agency.
Treasury Board and its secretariat will continue to play their roles in ensuring adequate oversight at the appropriate stage of the procurement process while supporting the Defence Investment Agency in its efforts to streamline defence procurement.
We would be happy to take your questions.
