Public Accounts Committee on April 9th, 2024

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Was BDO involved in conversations around developing the non-competitive contract between GC Strategies and CBSA?

[Mike Abbott]

To my knowledge, the answer is no.

I wasn't there, but certainly to my knowledge, the answer is no, we were not.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Did you ever bypass GC Strategies and work directly with the federal government?

[Mike Abbott]

Because we had two streams of work—one which was directly with CBSA—I have to answer yes because we had a direct contract.

I wouldn't characterize it as bypassing, where we were contracted to deliver work through GC Strategies. We delivered that work through GC Strategies, not directly to CBSA. We would have worked through that relationship.

As it pertained to our other work, we would have worked directly through CBSA because that's where our contracting relationship existed—between BDO and CBSA.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Were any of you in contact with Cameron MacDonald or Antonio Utano?

[Nicole Foster]

I was not.

[Nick Markou]

I was not.

[Mike Abbott]

I can say no to Mr. Utano.

In a previous life, I had met Mr. MacDonald in boardrooms and meetings, but not personally.

[John Weigelt]

No.

[The Chair, Conservative, John Williamson]

That is your time, Ms. Yip.

We now go to Ms. Sinclair‑Desgagné for two and a half minutes.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Thank you, Mr. Chair.

I'm going to be quick.

Mr. Abbott, I am picking up where we left off.

When GC Strategies reached out to you, you said that it already had a contract and that you hadn't bid on that contract together. Why didn't you submit a bid?

How do you explain the fact that GC Strategies already had the contract and then contacted you? That means it landed a contract without having the resources it needed to execute the contract. To your knowledge, what resources did GC Strategies put down in its bid to land such a contract?

[Mike Abbott]

I certainly would not have a line of sight on what GC Strategies would have submitted in its overall contract to win work, so I don't know the answer to that.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

We have the contract between the CBSA and GC Strategies, and it contains a long list of resources that have to be available in order to win the contract. A lot more resources were listed than the number of people GC Strategies had.

Here's my first question: How is it that no one at BDO Canada read the existing contract between the CBSA and GC Strategies? Second, how did GC Strategies delegate the work to you, knowing that you may not have even submitted a bid to GC Strategies? Wasn't it really just about personal contacts? The key resources weren't identified, and the company's experience no longer actually counted for anything.

[Mike Abbott]

I certainly understand the type of organization that GC Strategies is. There are generally two reasons why organizations are going to get contracts. One is through staff augmentation and the other is through acquiring a specific skill set.

Certainly, my understanding of the contract that would exist is this was for staff augmentation, which is one that BDO, at the time, would not have qualified for.

Part of the reason why we were interested in a organization like Lixar is that they had some of the deep application resources and data scientists. At the time that contract came out, it would not have fit within our radar because we didn't have the capability. We were a few months into our acquisition of Lixar.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Were you aware that what GC Strategies was doing was staff augmentation, as you called it? Usually, a company has to identify exactly who will be performing the work in question in order to win the contract. In this case, they landed the contract without identifying the staff who would be working on it.

How could the Government of Canada and its procurement authority award contracts without first identifying who would be working on them?

As you said, you were contacted after the contract was signed. That means that the resources had not been identified when the contract was awarded. How do you think that could've happened?

[Mike Abbott]

I have never worked in the staff augmentation business myself. That's not something I've done in my current or previous roles. I have an understanding of how those happen, in general.

Regarding the specifics of what GC Strategies submitted, I haven't seen what that contract is. I would certainly venture the view that they come into agreements with independent contractors. They may have come into agreements with organizations to get the authority to use those resources on their bid.

I haven't seen that contract, so I can't speak specifically on what they submitted. I just wouldn't have access to that.

[The Chair, Conservative, John Williamson]

Thank you very much.

Next up is Mr. Desjarlais.

You have the floor for two and a half minutes.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much, Mr. Chair.

I want to return to a few items from our last rounds of testimony, starting with Ms. Foster.

You mentioned that you were aware of Dalian and that your relationship with Dalian was a customer-client relationship. You denied an accusation from one of our colleagues here related to being a subcontractor. It seems to me that you had awareness of the primary contract or task authorization for Dalian, and you knew they'd become a client of yours for production of work they would use to meet the needs of the task authorization.

Isn't that the same as being a subcontractor?

[Nicole Foster]

No, it's not the same as being a subcontractor.

Being a subcontractor means you agree to the terms of the original contract. We're not a subcontractor to the original contract. They provided—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Were you aware of that when you signed the agreement—that this would be the case for subcontractors?

[Nicole Foster]

I can't speak on that. I don't have that information.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Why not? It's a simple question.

[Nicole Foster]

Well, I [Inaudible—Editor].

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

I'll ask it another way for you.

You just agreed that you had knowledge of task authorizations given to Dalian. You knew Dalian was in fact going to look for subcontractors. You can call it a “client-customer relationship”, but you did work for Dalian, which was doing work for GC Strategies.

Is that correct?

[Nicole Foster]

I cannot agree with most of what you just said.