Do we have your agreement?
Evidence of meeting #34 for Public Accounts in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was contract.
A recording is available from Parliament.
Evidence of meeting #34 for Public Accounts in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was contract.
A recording is available from Parliament.
6:05 p.m.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Mr. Marshall, we are talking about equity and justice. The Auditor General told us that this process proved to be unfair and inequitable. You are denying these facts. Moreover, you say that if this contract is cancelled, this will entail significant costs and no doubt some legal actions as well. I think that all of the members of the committee are aware of that. Of course, we have to manage public funds, and the final decision will be made by the government. However, this is a matter of fairness and justice. Whatever the value of the contract, the committee will eventually have to examine this and determine whether in practice this contract was tendered, as Ms. Fraser said, in an inequitable way. If that is our conclusion and if the contract has to be cancelled, that will be regrettable, and there may be related costs. The members of the committee would not make such a decision lightly, I am sure of that. The members of the committee must weigh all of these matters carefully.
Would you have said the same thing if this had only involved a million-dollar contract? Would you have told us to be careful because significant costs would be incurred? It is a matter of principle and, of course, of money. Much more rigorous attention should have been brought to bear before awarding a contract of close to a billion dollars, all the more so since we know that the same firm was awarded the pilot project, the first contract and the second one, even after the first contract was cancelled. That also raises a series of questions in the minds of the members of the committee. Light will have to be shed on all of these aspects.
6:05 p.m.
Deputy Minister, Public Works and Government Services Canada
Mr. Chair, may I please underline once again that the process was not as good as it should have been. I acknowledge that. I would like members of the committee to understand that the result would not have changed as a result of this number. We saw that one of your members had done his own calculation. We've done the same calculation.There was no fraud or bad faith involved. You consider that as well.
When you consider that the result would not have changed, you would also consider, as Mrs. Fraser has rightly pointed out, that there might have been other bidders who would have participated if they'd seen a different number, for example. I want the committee members to understand how far we went to try to invite as many people as possible. Here's how far we went. The quality of the service was very important to the members of the armed forces. We wanted people qualified to handle a very large volume--12,000 moves--for the armed forces. If we had asked for people with experience of 12,000 or more, there would have been only a single firm in all of Canada that could have qualified, and that is Royal LePage. We said we would consider the bid of anyone who had done at least 500 moves. We also said you didn't have to have an army of people to handle this on day one. You could go into a consortium, or you could tell us what you would do in the future, and we would assess you on that basis.
So, members of the committee, you have to understand that we took a lot of steps to try to make sure that as many people as possible would participate. There was no malintention. There was no bad faith involved. And even after you consider all of that, the result would not have changed. And that's the basis, really, of what I'm submitting to you. It's really not appropriate to start tearing up contracts that have been entered into in good faith, especially when there will be an opportunity in 2009 to have another process. Believe me, we have learned a lot of lessons from this. I mean, we are going to be much more careful, and that's how government works. You learn from your mistakes. You have to understand that if there were fraud or bad faith, then the money would not be a factor. We would need to restore the faith of the process and re-tender, but there was no such thing here.
6:10 p.m.
NDP
David Christopherson NDP Hamilton Centre, ON
It was a billion-dollar contract and nothing more could have been done?
6:10 p.m.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Mr. Chairman, I want to conclude by advising the committee that at the next meeting I will be tabling a motion asking that we convene Ms. Sandra Buckler and the registrar of lobbyists, so that the committee may gain a better understanding of the things which Mr. Badun has said to us which were not entirely clear. I intend to table such a motion. Thank you.
6:10 p.m.
NDP
David Christopherson NDP Hamilton Centre, ON
Given it's a billion-dollar contract and you went out of your way to do all that, what is the figure?
6:10 p.m.
Manager, Project Delivery Services Division, Public Works and Government Services Canada
It's $129 million.
6:10 p.m.
NDP
David Christopherson NDP Hamilton Centre, ON
It's $129 million. It makes the $50 million look even bigger, by the way. Somebody was throwing around $1 billion here before.
6:10 p.m.
Manager, Project Delivery Services Division, Public Works and Government Services Canada
It was only the administration fees. We didn't include third-party services, such as property management.
6:10 p.m.
NDP
David Christopherson NDP Hamilton Centre, ON
Okay, which is it, folks? What's the total figure of all the contracts we're talking about here?
6:10 p.m.
President, Envoy Relocation Services Inc.
Well, I have a letter from Mr. Goodfellow telling me the value of the contract that was awarded, and it's a little over $500 million.
6:10 p.m.
NDP
David Christopherson NDP Hamilton Centre, ON
Fair enough. Half a billion dollars. It's a big contract. You've gone out of your way to say you don't even need to have things in place and you can show us good plans. I know you can't answer, but why would you speculate that nobody else would bid, besides one other, in addition to the one who had it already?
6:10 p.m.
Deputy Minister, Public Works and Government Services Canada
Richard, do we know how many people came to the bidding conference, and so forth?
6:10 p.m.
Manager, Project Delivery Services Division, Public Works and Government Services Canada
Yes, five potential bidders, plus their affiliated associations, all came to the bidders conference.
I only want to point out that it was not a $500 million contract. It was $129 million over five years. It was only the administration fees, and we did not include third-party services. Those were flow-through costs, which were used for evaluation purposes only, and were only weighted as being worth 25%. It was not half a billion dollars.
6:10 p.m.
President, Envoy Relocation Services Inc.
It has an impact on the outcome of the evaluation. We're being evaluated on $500 million.
6:10 p.m.
Liberal
The Chair Liberal Shawn Murphy
I think the witness has answered the question. Please direct your comments to the chair.
Colleagues, I believe that concludes all the rounds.
We are going to go in camera. At this time, I want to adjourn the formal part of the meeting. We are going to take a short break for two minutes. I would ask all the witnesses, other than Mr. Marshall and his staff with Public Works and Government Services Canada, to leave the room.
It's been a long afternoon. It's a somewhat complicated case. I want to take this opportunity to thank the witnesses very much for appearing here this afternoon. It's been very helpful.
Thank you.