International Trade Committee on Oct. 2nd, 2024

[Kim Campbell]

I want to start by saying that this is a sad day for all of us to be here, no matter what happens. We're all very passionate people who want to make our borders go through.

We have done a survey with our members, of whom 80% don't feel they're ready and are asking for a delay. Twenty per cent did not support that; they're ready to go.

When you actually unbundle that, most people who want to go have invested a lot of time and energy. We're all exhausted. We just kind of want to rip the band-aid off and see what happens. That's part of the risk. Are we ready? We're not sure. We think there's a lot of uncertainty and scary things on the other side. We don't know some of that until we do it.

Even just talking about the portal experience, there are so many people who can't even get into it. We had a great conversation with some of our colleagues from CFIB yesterday. A lot of those members are still struggling. We know that some of our other like-minded associations have sent in letters.

Generally, everyone is saying the same thing: We're not ready.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Do you have any concerns about the level of training you received on the system?

[Kim Campbell]

I'll defer to some of my other colleagues here, because I feel like the folks who have been allowed to lean in through the CES testing have a competitive advantage over the rest of us who haven't.

I can speak to you from my perspective and about what we're hearing from members. Members are feeling very stressed. This is my volunteer job. My full-time, paid job is as a customs broker. I work with a very well-known service provider that provides software. We're all struggling right now. They're struggling to try to train us. We're struggling to try to deal with our staff and then try to educate our clients.

That's kind of the state of affairs right now.

Others could certainly weigh in if they have a different perspective.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

To date, given the challenges that cropped up, do you really think the CARM deployment timetable is realistic?

[Kim Campbell]

I wouldn't say it's not unrealistic. The approach is unrealistic.

We put in our submission—we were talking about this in May—that it's the "big bang" approach that really is problematic. We were very supportive of Mr. Gallivan when he stated in his presentation to the committee in the early part of the year that those who are ready to go can go.

Again, we want to say that we support that approach. That's the approach we should be taking. Those that are ready to go should be able to go, and the rest should be able to come on as we figure out the system, make sure it's stabilized and all those things. That is still what we continue to say at this point.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

So, if I understand correctly, you think you will be ready to launch CARM.

[Kim Campbell]

I will have to be ready if I'm forced to be ready, and so will all of our members. We don't know the ramifications, but obviously we might have no other option at this point, based on what CBSA continues to say.

[Richard Martel, Conservative, Chicoutimi—Le Fjord, QC]

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go to Mr. Sheehan, please, for five minutes.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Thank you very much.

Again, welcome back. It's a very important discussion.

I represent Sault Ste. Marie. It's the riding thereof, so it's Sault Ste. Marie and the surrounding area. It's a border-crossing town. We know that folks come into the Soo with their stuff from over the bridge. It comes by water. There are ports. It comes by train. It comes by way of a whole bunch of other things like airlines. A lot of trade comes through these border towns across Canada. Sault Ste. Marie is one of them.

My background is in business and economic development. I had my own little business and also did a bunch of trade missions for the local economic development corporation. I know a lot of the folks working in your area.

One of the things I noted when I was thinking about this whole CARM thing was the process of integrating IT into our systems. I've seen it before, way back. I went to school at Lake Superior State University in Sault, Michigan. People would come across, and the paperwork would be horrendous. People would be there for a very long time trying to get their stuff through—bringing their custom brokers in and continuing to do it. Over time, I worked for the first commerce-enabled website in northern Ontario. At that time, you saw people trying to get into IT, but you also saw some resistance for a variety of reasons and because of complicated things. Sometimes there were bugs in the system, but sometimes it was the education and training thing that Richard alluded to earlier. One of the things I'm trying to understand right now.... Businesses, now, have started to change. They have IT platforms and systems in place to expedite the processes.

My first question, I think, will be for Deloitte, because we're getting towards the eleventh hour.

What are the consequences if we delay the launch of CARM for six months, if you don't mind answering that question?

I believe you're online.

[Louise Upton]

We are.

Thank you. I appreciate the question. I think it's an important one.

The system itself has continued to be tested. We have run several mock conversions. We've run several preparations to go live in terms of cutover. I think what's very important here is that we are replacing a 30-plus-year-old accounting system in the Government of Canada—a system that, by their own admission, is in desperate need of replacement. If I understand correctly, it had challenges even as early as this morning. The system is down and continues to be a challenge. Continuing to delay, I believe, will continue to cause undue stress on this particular system.

Having done this implementation work for over 30 years.... I think I heard you say that it's not uncommon to have some trepidation. It's not uncommon for things to not feel like everybody is 100% ready. What I've seen with clients in this particular case is that, at some point, it's important to actually move forward. The response you have in terms of supporting the system, once it is live.... The ability to bring in the right resources to provide that support is equally important.

That's where I feel we've continued to prepare and make sure the CARM solution is ready to go live.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

You're known to be good with the numbers.

What would be the cost to the taxpayer of a six-month delay? You didn't speak about any costs of a delay of six months.

[Louise Upton]

I can't speak about the overall cost, because I'm not fully aware of all the costs within CBSA.

What I can say is that, historically, we've seen a six-month delay cost anywhere from potentially $20 million to $30 million. That would be the ballpark number I can give you, at this point.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

It's about $30 million.

Thank you very much.

I was going to ask you this: Would the contract you have with CBSA allow for a six-month delay at this time?

[Louise Upton]

We would need to have conversations around Deloitte's role during that six-month delay.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Okay.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Savard-Tremblay, go ahead for two and a half minutes, please.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Thank you, Madam Chair.

First of all, regarding the request received from the Canadian Association of Importers and Exporters, a motion is on the table to request a suspension. I will move an amendment to add the involvement of a third party. If it passes, it will be part of the recommendation the committee then makes to the House.

Ms. Sider, from the Canadian Society of Customs Brokers, we received your brief. Unfortunately, it was not in French. I therefore invite you to also send a French version of your documents next time.

You said that comments from your members show that nearly 70% would be in favour of postponing until April 2025, and that your relationship with the CBSA deteriorated recently. Could you tell us more about that?

[Candace Sider]

Thank you. That's a great question.

You know, prior to the last 12 to 18 months, trade chain partners met on a regular monthly basis with CBSA. That was to bring us all to the same table, to have the same conversations and the same discussions, to listen to the concerns from the trade community and to arrive at resolutions so that we could position ourselves to go forward.

It's unfortunate, but the relationship with CBSA and the communication with external trade has really eroded. There's been very little communication. While CBSA has attested to a different kind of communication strategy in terms of bringing together smaller groups and having those candid discussions, the challenge is that it's very isolated. Now you're having meetings in silos. You're discussing certain issues with certain parties. It's not communicated more broadly right across all trade chain partners. That definitely has led to a source of frustration.

We're all in this together. We've always said that from the beginning. It's been a long modernization project, and we're here to support the agency, but we also need that two-way communication. It's critical for us in terms of going live.

The position of our membership is that 60% would like it to be extended, but that really is because of the unintended consequences of what we don't know is around the corner. We can implement. We can start our cutover period. We really won't know until we come back live on the 21st. To go through a period of a 16-day outage is unheard of in industry. We're not aware of any government that is down for a 16-day period, and that prevents us from being able to actually invoice importers and manage those payments to the agency.

One impetus as to why we were moving to CARM was for some assurance in terms of payment to the Receiver General for Canada and to move away from customs brokers.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Cannings, you have two and a half minutes, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Maybe I'll go back to Deloitte.

Ms. Upton, could you perhaps tell me why we need this blackout period? Why don't we have any options, going forward, for people to register or not right away, so that we could have a more graduated start to this whole program? It seems that some of the real concerns aren't so much the training, etc., but this “big bang” way of going about things.

Why was that chosen? Why can't we fix that right now? Why can't we change it?

[Louise Upton]

I'll take it from a couple of different perspectives to provide some context.

As I mentioned earlier, the system we're replacing is over 30 years old, so the complications with that system in looking at trying to run things in parallel—making changes to that system and keeping things in sync—were conversations that happened early on in the process. I was not part of those conversations, but my understanding is that it was deemed to be not feasible because of the complexities of the aging system and the technologies that were there.

The other piece of it is that the solution is being rolled out in a series of different releases. This is probably release five, six or seven of this solution. It's not that we haven't thought through how to roll it out more thoughtfully. We started back with release zero. We had a release of what we've affectionately called R2 internally at the CBSA. We're moving to R3. There have been ongoing releases throughout the life cycle of the program.

In terms of the 16-day blackout period, I think what's important to remember here is that we are actually migrating 6.7 billion records of historical transactions that need to be there for the CBSA to do any sort of reconciliation and have any sort of history of those transactions as they move forward. That is not a small volume. It's a very big volume, and that is partly what requires the amount of time for the blackout period.

The other component of that is that we have left ourselves some time in there to make sure we have some contingency, so that we have time within that blackout period if something unforeseen should happen. In my years of doing this, I have seen all kinds of unforeseen things happen. It can be anything from the city taking the power down to a fire in the building. We can't plan for the things we don't know, which is why we've also left ourselves some contingency in that time frame.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Jeneroux, go ahead for five minutes, please.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Thank you, Madam Chair.

Thank you, everybody, for being here yet again to look into this.

We're 31 hours away from the blackout period. I've never seen anything like this in my nearly 10 years of being here. This is right down to the wire, and the individuals being impacted by this don't have confidence that it is going forward in a way they're comfortable with and that helps them do business.

We've already seen the arrive scam and the Phoenix pay system from this government. I can't say I have any confidence either in where this is going.

The first question I'll ask is for you, Ms. Upton. Again, you're back at this committee.

Have you been asked by the CBSA to consider the possibility of a delay?

[Louise Upton]

The conversations we've had to date have been about moving forward and focusing on the cutover, which begins on October 4.