Government Operations Committee on May 26th, 2026

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

Those are points and evaluation, but they don't actually have to sell a Canadian good—

[Dominic Laporte]

For some procurement, we—

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

—or include Canadian services. A Canadian supplier can be fully foreign-owned; it doesn't have to make a Canadian good, and it doesn't have to provide a Canadian service. Is that true?

[Dominic Laporte]

If we go back to the definition of “Canadian suppliers”, you need much more than that. You need to drive economic value in Canada. You need to create employment. If you're simply an importer of record and you add no Canadian value to the goods that you're reselling, you won't meet that definition.

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

Thank you.

[The Chair, Conservative, Kelly McCauley]

Mr. Danko, as I understand it, you're up. You have six minutes.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Thank you, Chair.

I'm very excited to discuss the buy Canadian policy this afternoon. Before I was elected to public office, I spent 20 years in consulting engineering. I did a lot of work writing and reviewing contracts for public sector bids. One of the frustrations was always that, in the public sector, it's the lowest bidder and there wasn't an ability to tailor those contracts to really benefit the local economy and, in this case, the national economy.

Could you give us an overview, very broadly, of the current procurement procedures, such as how bids are evaluated, what the pre-qualification is and that kind of thing? How will that change now with the buy Canada policy?

[Dominic Laporte]

Thank you for the question.

In the past, we had different non-price elements and price elements when it came to bid evaluation. There were the technical requirements, of course. The cost was also a key driver. What we're doing now is really shifting the evaluation grid to include, in most procurements, a component that will be the Canadian content. It allocates 25% of the overall evaluation grid to Canadian content.

If I'm a bidder and I'm providing more Canadian content, which could be through services or the raw materials I'm sourcing, I'll get more points than my competitors. This is a key change.

I have to say that in the past, when we looked at procurement, we used to look at socio-economic factors. This is another one that we are incorporating, since December 16, with the buy Canadian policy.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

So that I'm clear, and for the public record, when bids are evaluated, the buy Canadian component is 25% of the evaluation. The bids will not necessarily go to the lowest bidder. How much of a Canadian component is in the bid will be part of the evaluation and the award.

[Dominic Laporte]

Exactly.

I may also turn to Levent. He may want to provide a bit more context on the application of the policy.

[Levent Ozmutlu, Director General, Strategic Policy Sector, Department of Public Works and Government Services]

Absolutely. Thank you for the question.

Yes, in effect, the buy Canadian components become an element of determining best value.

In the past, evaluations were predominantly based on technical merit and financial criteria. Now we've also included elements related to buy Canadian. Some of those elements will be mandatory as they relate to, for example, the use of materials in construction and defence contracts. We have mandatory requirements related to steel, aluminum and wood. Beyond that, we're looking at Canadian value added, both for the services component and for the goods that would comprise the solution being proposed.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

The current policy right now applies to federal contracts of $25 million and over. The initiative is to reduce that down to $5 million and roll out the small business procurement programs. Could you elaborate on the future of the buy Canadian policy?

[Dominic Laporte]

We plan to lower the threshold as of June 15. That's going to have a huge impact in terms of the number of procurement opportunities that will be covered and will benefit from the buy Canadian opportunities. We're going to have a bunch more contracts. We're going to be driving Canadian content. That's one thing.

At the same time, we're working actively on the small business procurement program. The goal is to see how we can simplify procurement. How can we make procurement more accessible to small businesses?

On that point, I can turn it over to Clinton, if you'll allow me, because he could expand on that.

[Clinton Lawrence-Whyte, Director General, Buy Canadian, SME and Digital Solutions Sector, Department of Public Works and Government Services]

Thank you very much for the question.

As mentioned, one of our priorities is to make procurement more accessible for small business. In the context of that new policy, which is still currently under development—we're looking for it to be released in the near future—it will have elements of simplification. We'll be looking at how to look at the process of procurement itself. For example, from the perspective of a small business and what it has to go through in terms of steps, can we streamline that and make it easier? Can we make the requirements clearer?

These are elements that we're going to be looking at. We'll also be looking at the provision of support to business, including leveraging technologies and digital technologies, to ensure that the support that small businesses need is accessible on a 24-7 basis.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

Thank you.

There's interest across Canada in buy Canadian, for obvious reasons. I come from a municipal level, and it was something we were very interested in. The Province of Ontario is interested in buy Canadian, so it is very good to see this leadership at the federal level.

My question through you, Chair, is this: As the federal government leads with the buy Canadian policy, how do we see it impacting decisions at the provincial and municipal levels of government?

[The Chair, Conservative, Kelly McCauley]

I apologize. Give a short answer, please, in about 30 seconds.

[Dominic Laporte]

We are working closely with provincial and territorial partners to provide them with a road map to implement their own version of buy Canadian, should they wish.

[John-Paul Danko, Liberal, Hamilton West—Ancaster—Dundas, ON]

That's excellent. Thank you.

[The Chair, Conservative, Kelly McCauley]

Thanks.

Go ahead, Madame Gaudreau.

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

Thank you, Mr. Chair.

I'm trying to understand the consistency and the validity of all of this. It's perfectly legitimate, but what happens on the ground is something else.

When we talk about Build Canada Homes and building more housing, we need to have truly Canadian suppliers. However, right now, in my riding and in many other places, plants are closing. It seems to me they were potential suppliers. It's all well and good to say that we're going to focus on developing the Canadian market instead of trying to penetrate the European market, but it's still wishful thinking. We need to provide direct assistance to businesses so that they can survive.

Have you thought about that?

[Dominic Laporte]

It worries us a lot to see plants closing, including steel mills or sawmills in your riding.

The purpose of the “buy Canadian” policy is to ensure that Canadian purchases made through government departments will benefit Canadian businesses. Therefore, we have to buy Canadian wood. Perhaps, in the past, companies went elsewhere to get the wood or import components. The goal is to make Canadian purchasing mandatory in future contracts and to ensure that it benefits local workers.

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

I have a very simple question.

Right now, these businesses don't have cash flow. They only have access to medium to long-term assistance. I was a victim of that: In our region, a business that had been around for 100 years closed its doors. Business owners are telling us that it is all well and good to help them get certified, but if they have to cancel two shifts, it is just wishful thinking.

I imagine you are having discussions. Is there any help on the way for these companies?

[Dominic Laporte]

Unfortunately, that's not my area of expertise. My true area of expertise is procurement. I know that my colleagues at the Department of Industry and other departments work closely with these companies, so they would surely be able to tell you more than I can and give you all the facts.

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

As much as I don't like using the term, it's common sense. It has to be said: If a business owner says he wants to contribute, he has to be given a chance. There are valid proposals out there right now. It was the same thing during the pandemic, but we're not being listened to. These companies come here to give us ideas for having some leeway, and now we're ignoring them while saying we're going to buy Canadian. We have to be open.

Regarding the use of procurement as a lever, I've seen that in Germany and France, public procurement is often used to support a complete industrial ecosystem: small and medium-sized businesses, suppliers, processing, training, research and so on.

Is that how the Canadian government thinks, or is every policy designed independently?

[Dominic Laporte]

Other countries are in the process of developing their supply ecosystem. That's what we want to do in Canada through the “buy Canadian” policy. It's certainly not a policy that was designed in a vacuum by Public Services and Procurement Canada, or PSPC. It was done together with a number of departments. The “buy Canadian” policy is part of an overall effort that has a number of other components besides procurement. Indeed, we see that other countries aren't afraid to put forward policies that favour their local suppliers and local inputs.