Evidence of meeting #118 for International Trade in the 44th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cbsa.
A recording is available from Parliament.
Liberal
Mona Fortier Liberal Ottawa—Vanier, ON
Yes, thank you.
My colleague was asking about a transition plan. Can you share a bit more about that transition plan? I understand that it is ready. Are there any risks or any updates that you want to share with the committee members about that transition plan?
Partner, Deloitte
The transition plan itself—we also refer to it as the cutover plan—is the detailed line by line, item by item, activity by activity that needs to happen. It's everything from extracting data from one system and loading it into the new system and validation of data. It's a minute-by-minute transition plan. It's ready.
Even more importantly, we have rehearsed it and successfully used it seven different times. In addition to the seven different times, we've also used it internally to launch the CARM solution that CBSA has been using as a verification tool since May of this year.
Liberal
Mona Fortier Liberal Ottawa—Vanier, ON
On the record, you would probably recommend moving forward rather than delaying at this time, as Deloitte is part of this contract with the government. Would that be a recommendation?
Partner, Deloitte
We would say that the solution is ready. Further delaying the solution would continue to cause challenges with the trade chain partners that are ready. Moving forward, we believe, is the right thing to do at this stage.
Liberal
The Chair Liberal Judy Sgro
Thank you very much.
For the information of the committee, we have completed three full rounds. We have a couple of motions to deal with.
Is it the direction of the committee that we dismiss our witnesses and focus our concentration on these motions? Is everybody good with that? Okay.
Thank you to our witnesses for your very valuable time and information.
To those online and those in the room, thank you again. We look forward to moving forward with the completion of our study.
Thank you all very much.
I will suspend for a couple of minutes.
Liberal
The Chair Liberal Judy Sgro
I'm calling the meeting back to order.
When we ended the last meeting, Mr. Savard-Tremblay had the floor.
I turn the floor back to you. Mr. Savard-Tremblay, you have the floor.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
Do you want me to talk about the amendments that were put forward?
Liberal
The Chair Liberal Judy Sgro
Yes, you now have it as a whole thing here. Yes, you can speak to it, please.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
We received the motion from our Conservative colleagues last week. Essentially, I have three amendments to move on this motion, as you can see: recommend a mutually agreed-upon independent third party, as requested by the Canadian Association of Importers and Exporters; receive the documents before launching CARM, which I remind you we are still waiting for; and, finally, that the committee report back to the House on this motion.
Those are my proposed amendments. I don’t know if my colleagues, the movers, accept them.
Conservative
Tony Baldinelli Conservative Niagara Falls, ON
I am not comfortable with those changes, Madam Chair.
Liberal
Maninder Sidhu Liberal Brampton East, ON
Oh, did you? I didn't get one. Sorry.
We heard from the witnesses today and we know that there are financial implications of waiting another six months. As we heard, there's the cost of $20 million to the public purse, not including the missed revenues that could be collected using this new government system. I think as committee members we need to take that into account.
We also heard from witnesses saying, if we have to be ready, we'll be ready. We also heard that we need to help bridge some of the gap in terms of importers signing up for this program. I think there could be more work that we need to do with outreach to some of these importers and with the stakeholders we have here today.
However, bringing in a third party, wouldn't that add more costs to this important CARM program? I'd like to hear from members on that, because I don't think this would be beneficial, bringing in a third party when we know where we have to get to and we're pretty much almost there. This doesn't make sense to me. I'm just wondering if the member opposite can speak to what a third party would help with, maybe in terms of the questions that we heard from witnesses today.
Bloc
Simon-Pierre Savard-Tremblay Bloc Saint-Hyacinthe—Bagot, QC
The Canadian Association of Importers and Exporters laid it out thoroughly. It’s also well explained in what was presented to the committee. We saw that the last postponement may have led to some developments and some progress in the end, but there were still a lot of failures. I therefore have no confidence that the CBSA can regulate itself in this matter.
In any case, I think we heard most of the arguments. I therefore propose that we vote on it.
Liberal
The Chair Liberal Judy Sgro
I'm sorry; I have other questions here.
I have Ms. Fortier and then Mr. Chandra Arya.
Go ahead, Ms. Fortier.
Liberal
Mona Fortier Liberal Ottawa—Vanier, ON
Thank you, Madam Chair.
I see just how important the debate is on this motion.
What I find somewhat troubling is that we want another third party, which my colleague started talking about. How, in this case, do we define an independent third party who will be responsible for finding certain solutions? We already have a third party, Deloitte, whose representative stated in their testimony that the company tested the system seven times and has a transition plan as well. I’m therefore trying to see to what extent it is actually useful to have another third party.
Furthermore, if ever we managed to define what is meant by “independent third party,” how much time and money will we have to spend on choosing the group to play this role? I disagree with the proposal of choosing an independent third party to try and find those solutions, because we already have what we need in place. Since Deloitte says it has a transition plan, I think it’s clear they have the required tools to resolve the remaining problems, because we know there are still some.
Liberal
Chandra Arya Liberal Nepean, ON
Thank you, Madam Chair.
At one point in my life, I was involved in the development of an industrial project, having set up my own, and I've been involved in the financing of many industrial projects, though they were all small-scale industries in other countries.
One of the best ways to kill any project at a late and advanced stage is to bring in a third party. Any project, however small or big, is a complex thing. You cannot define a project by its minute parts; it is not possible.
Give me any project. In fact, when I was in a financial institution evaluating projects for financing, I could take a project and say, “Hey, do you want to fund this project?” Tell me, and then I can find 10 arguments for why we have to fund this project. Or, without reading it, if you do not want to fund this project, then I can prepare 10 points for why we should not fund it.
If you want to kill a project, especially a big, sensitive and important project, and if the intention is to kill the project, this is the time when you have to bring in a third party—any third party. It has to be a private sector company. A third party can come and they can put on the glasses and view the project. If the glasses they put on will help find the deficiencies, they can find 100 deficiencies; any complex project will have them.
In the project implementation period, as it is called in manufacturing projects, the project is set up and then it comes to commercial production. In between, a typical manufacturing project has an implementation period of 18 to 24 months, because the projects are always complex. If you bring in any party now and the party decides they want to kill or delay this project, they can come with a 100-page report on why we should not implement this project.
At the same time, you can also get consultants. If they want to push this project, they can give 100 reasons why we should go ahead with this. If the intention is to unnecessarily delay.... We have heard the witnesses. I did not ask any questions, but I heard the witnesses a second time today, both from the user's point of view and from that of the people who developed it, and I understand that projects are never perfect until and unless we start actually using them and implementing them.
Madam Chair, in my view, the only intention of this suggestion to bring in a third party at this stage is to kill the project. That's it. There's no other way I can put this. Any complex project, in my experience, which was in manufacturing projects, is always a complex entity. It is almost a living organism. It will have some defects, just like no human body is perfect. We all have defects in different parts, but we'll all settle down after some time and come to a routine, so I fully oppose this particular proposal.
Liberal
The Chair Liberal Judy Sgro
Thank you very much.
I have Mr. Cannings, then Mr. Baldinelli and then Mr. Sidhu again.
Mr. Cannings, go ahead.
NDP
Richard Cannings NDP South Okanagan—West Kootenay, BC
I'll try to be brief. I mainly want to talk to the main motion, not so much the amendment that Monsieur Savard-Tremblay has brought in.
I have some concerns with the idea of a third party in the sense that it would require some development of a mandate for that third party. I don't know how long that would take. If this was at the start of a project, it might take a considerable amount of time, and it seems that we have three days or something.
What I want to say is that, overall, I've really struggled with this whole study. We've been rushed both times to take all of this in, and we've had rather opposing viewpoints from both sides, naturally. I came in here thinking I was going to support a delay, but by the end of this meeting today, I really haven't been convinced that a delay would accomplish anything. I haven't seen any concrete evidence, at least, that we desperately need a delay to do X, Y and Z.
It seems that most of the concern is from 80% of the clients, who don't feel great about this. They just don't know what's going to happen, but I haven't heard how six months is going to fix that. We've heard that the CBSA has communications problems. Maybe that's a structural way of how the CBSA works, and it's going to take longer than six months to fix it. We've heard it's going to cost businesses money. Presumably, it's going to cost the government money.
I'm just saying I think I will be voting against this motion to ask for a delay. I think Monsieur Savard-Tremblay's concerns are separate from that, but I will leave it there.
Conservative
Tony Baldinelli Conservative Niagara Falls, ON
Thank you, Madam Chair.
I thank my colleagues for their indulgence in considering the motion.
I'm going to speak to the motion overall. The government has already talked, as some of my colleagues have mentioned, about the cost of not proceeding. Well, this is not the first time CARM has been delayed. In fact, it was delayed just last spring. What was the cost of that? What did we find out from that? Nothing has changed from the time we were examining this back in the spring. We still have numerous concerns from stakeholders that this portal, this project, is not ready.
My colleague talks about Magna and their writing in support. Well, of course Magna would be in support. They're one of the 44 testers. They've been working on it for three years. They have a competitive advantage to it. They've been working on the system.
However, when we look the Canadian Association of Importers and Exporters, they did a survey of their membership, and 80% of their membership are saying no; they're not ready. There are only 20% who are ready.
We've received a letter from CFIB. Only 48% of their members are registered for this. They represent 97,000 small and medium-sized businesses across this country. They're saying they're not ready.
We've heard testimony from the testers who are doing the work. They're submitting tickets, and the government has yet to respond to numerous tickets. How are they going to be able to implement it with hundreds of thousands of tickets that are coming in? They had a six-month delay already, and they've yet to answer the questions of the stakeholders to satisfy their arguments.
Ultimately, we're going to vote. Again, going back to my colleague, Magna must be one of the testers. They're fine with it. However, we received a letter from the Global Automakers of Canada. They represent Honda, Hyundai, Jaguar, Maserati, Mercedes-Benz, Mitsubishi, Toyota, Volkswagen—26 brands. They say that Canada's automakers continue to have significant concerns about CBSA's capacity to effectively implement the CARM system, despite its plans to transition to this new system on October 4, 2024.
Ultimately, we're going to vote on this motion, but what is the cost of proceeding if this fails? I mean, this is the government that has given us ArriveCAN—a $60-million blunder. I can tell all of my colleagues what that did to my border community in terms of tourism. They also gave us the Phoenix pay system. There are still employees who are having difficulties with the Phoenix pay system. That should never have proceeded. If anything should have taught us that there should have been a parallel system in place before proceeding, it would have been the Phoenix pay system, and that has been a huge disaster.
Ultimately, we're going to vote here, but if this fails, it's on CBSA, it's on Deloitte, and it's on this government.
I'm ready to vote, Madam Chair.
Liberal
The Chair Liberal Judy Sgro
Are you ready for me to call the vote?
Okay. We'll have a recorded vote.
(Amendment agreed to: yeas 6; nays 5 [See Minutes of Proceedings])
We'll now go to the main motion
Mr. Savard-Tremblay's amendment has passed, and that's amending Mr. Baldinelli's motion.
(Motion negatived: nays 6; yeas 5 [See Minutes of Proceedings])
Mr. Savard-Tremblay, do you have another motion you want to present?