Public Accounts Committee on Feb. 20th, 2024

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

You can get back to the committee on that.

Was the minister briefed that a non-competitive approach would be taken on this issue?

[Heather Jeffrey]

The decision at the time was taken within the public service at the director general level.

My recollection of the signature of that contract is that it would not be normal practice to brief on the nature of how the operations were being implemented.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Having taken a non-competitive or sole-source approach—to not have any kinds of comparisons, not do any kind of shopping around to see if you can get a better price or a better product—who provided the oversight for monitoring the invoices that were coming in from GC Strategies?

[Heather Jeffrey]

The Public Health Agency did not contract with GC Strategies. I thought you were referring to the KPMG contracts that were administered through the agency.

It would have been CBSA that was monitoring those contracts related to the app development.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Okay.

I think that's my time.

[The Chair, Conservative, John Williamson]

Thank you very much, Mr. Scheer.

You have a few seconds left. You did ask for some other information at about the one-minute mark.

I do like to get an acknowledgement from witnesses.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

We'd like to know who made that decision to pursue a non-competitive approach on the KPMG.

[The Chair, Conservative, John Williamson]

You can make note of that request and provide an answer forthwith.

Thank you. I appreciate that, Mr. Scheer.

We'll turn now to Mr. Chen.

You have the floor for five minutes, please.

[Shaun Chen, Liberal, Scarborough North, ON]

Mr. Chair, we have heard today from PHAC that in the initial meetings with CBSA in March 2020, there was a lack of formal governance.

The AG's report says that “no formal agreement existed” between the two departments for the next 15 months. There was no designated lead, no project objectives and goals, no budgets, no cost estimates and no risk management activities. This, to me, is beyond comprehension.

Section 1.63 of the AG's report says, “A letter of intent between the agencies was signed in July 2021”. That, to me, is 16 months late. In the real world, a letter of intent between two parties is what you start with.

I'd like to hear from PHAC on what took so long to get a letter of intent signed.

[Heather Jeffrey]

I can say that the operationalization of the app was done collaboratively between the Public Health Agency and the Canada Border Services Agency. As I mentioned, we were very focused on the need to stand up the app and to have it rolled out to allow the border to flow and to have a safe restarting of the economy in addition to the flow of key people.

There was a de facto management of the app going forward that was not defined. That is not a best practice, as the Auditor General has pointed out, and steps have now been taken to rectify that going forward.

The letter of intent was developed as the app was moving from the voluntary use space to the mandatory space. That triggered a process to make sure that we had codified and documented the roles and responsibilities appropriately, which is a very detailed exercise. That was then conducted, and we acknowledge, recognize and take as a lesson learned that it should be done at the outset of this development in future.

[Shaun Chen, Liberal, Scarborough North, ON]

Section 1.70 of the Auditor General's report says, “We found similar issues in the 2 professional services contracts awarded by the [PHAC] to KPMG. While the first contract included milestones with clear deliverables and pricing, these were later amended and replaced with less specific deliverables”.

I would like to hear from PHAC. Why would you amend a contract that had clear deliverables and pricing to something that is less specific? That makes no sense to me. What is the rationale for doing that?

[Heather Jeffrey]

I believe that the intent at the time was to ensure that we had enough flexibility to adapt the requirements to a virus that was changing very quickly and was requiring some expanded responses for which we needed to use the services of KPMG to help deliver.

As you'll recall, at the time the contracts were initially entered into, we were not sure how long the pandemic would last. We did not know if there would be waves or if those waves would be seasonal. We were monitoring the entry of new variants. Initially there was not an expectation, I think, on our part that we were entering into many years of successive responses, and the responses were being built incrementally.

In terms of the need to ensure continuity of high-quality services, a decision was taken to add some broader categories to the contract. We take the Auditor General's finding and recommendation that it is not a best practice and that we should be as specific as possible to ensure value for money, but I do believe that the decision to create broader taskings was designed to allow for that agility and responsiveness in terms of the work that needed to be done.

[Shaun Chen, Liberal, Scarborough North, ON]

I'm confused. On the one hand, there were initially clear deliverables, and that is in the context of having milestones set out in the first contract. To me, milestones are broad goals of the work that needs to occur for the project. What you're saying is that the flexibility was needed because of the ever-changing needs arising out of the ever-changing pandemic.

The Auditor General continues on and says that, “In addition, the agency did not set out specific tasks, levels of effort, and deliverables for these contracts in task authorizations.” On the one hand, I'm hearing from you that there is an awareness of what's happening around the world, and, therefore, you were acting and modifying the contract to reflect the changing needs. On the other hand, we're hearing that the agency did not set out specific tasks, levels of effort and deliverables. I would like to hear from the Auditor General for an answer.

[The Chair, Conservative, John Williamson]

Mr. Chen, that is your time, but I will allow for an answer.

[Shaun Chen, Liberal, Scarborough North, ON]

Can I hear from the Auditor General?

[The Chair, Conservative, John Williamson]

Yes.

Ms. Hogan, the question is for you, please.

[Karen Hogan]

While I acknowledge that the Public Health Agency rightfully needed to make the overarching contract more flexible, given the evolving nature, that's where task authorizations then become really important to pull down off of this broader contract when you're asking for something specific. That's when you should be specific about the level of effort, who should be doing it and the skills that you need. Creating flexibility in one area still means that you need to provide some specificity for good accountability in another.

[The Chair, Conservative, John Williamson]

Thank you very much.

I'll turn now to Mr. Brock.

You have the floor for five minutes, please.

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you, Chair,

Since the release of the Auditor General's report, all we've heard from the Prime Minister and several ministers is that people need to take responsibility. They've essentially put up a firewall between the government and the federal public service, in particular the agencies that are under fire.

To you, Ms. Hogan, the Auditor General, did part of your mandate require you to uncover or ask for documentation to show what level of communication existed between the Prime Minister's Office, the PCO, various ministers that we've heard of today and their departments?

[Karen Hogan]

Our mandate really is to look at how the federal public service takes action once a decision has been made by a government—in this case, the decision to enact certain border measures—and then how that was operationalized. In the course of doing an audit like that, we might often see briefing material or so on.

In this case, because there was such thin documentation, I would tell you that we saw some emails where the deputy minister was being made aware of things at the Canada Border Services Agency, but we saw no formal approval from the deputy there, or no formal briefing to ministers. I can't really speak on what happened between the deputy minister and a minister throughout this.

[Larry Brock, Conservative, Brantford—Brant, ON]

Does that certainly apply to PHAC as well, the description you just gave?

[Karen Hogan]

Yes. We looked for it more at Canada Border Services Agency, because they were doing the main contracting and development.

[Larry Brock, Conservative, Brantford—Brant, ON]

That's correct...but also PHAC.

Ms. Jeffrey, I understand that you have been in the role of deputy minister and president for just one year. Who was your predecessor?

[Heather Jeffrey]

My predecessor was Dr. Harpreet Kochhar.

[Larry Brock, Conservative, Brantford—Brant, ON]

In preparing for this particular committee hearing, did you consult with your predecessor on details surrounding ArriveCAN?