Mr. Speaker, earlier this day I released the audit report of the Canada Communication Group.
As some hon. members may recall, I requested that an independent audit be conducted as a result of allegations made by suppliers, members of Parliament and concerned citizens on possible conflicts of interest in the contracting practices of the Canada Communication Group.
After listening to suppliers, I decided to act quickly to get the facts out in the open. That is why Deloitte and Touche were asked in March to come in and examine the Canada Communication Group's contracting practices. This impressive audit was conducted in just six weeks.
It is clear from the audit report that the Canada Communication Group's role as both a supplier and a contracting agent results in an inherent structural conflict of interest.
The auditors have recommended, and I have accepted as I have accepted all of the recommendations which have been put forward, that the Canada Communication Group procurement activities be transferred to the supply operations group within Public Works and Government Services Canada. This transfer is to be completed by August 1 of this year.
The decision to sever Canada Communication Group contracting arm from its service delivery component directly in my view addresses this finding of an inherent conflict of interest. The Canada Communication Group will continue to provide, however, a full range of services. However, the removal of the contracting activity eliminates both the potential for conflict of interest and a major irritant to suppliers across this country.
As well there are well over 150 employees at the Canada Communication Group whose lives will be affected by this decision. All affected will become employees directly of Public Works and Government Services Canada.
It must be noted that the auditors found the Canada Communication Group business practices to be consistent with its charter. Further, the auditors concluded that there was no evidence of illegal or fraudulent activities. The auditors also recommended that an advisory committee be established to look at the Canada Communication Group organizational status and its future evolution. This committee to be comprised of government and industry representatives will consult widely and extensively with all stakeholders in mapping out the future directions for the Canada Communication Group.
Officials are now finalizing the mandate of the committee and I expect to be able to name the members in the next few weeks and to have the final report from the committee some time in the very near future.
At the same time the Canada Communication Group in consultations with client departments, suppliers and central agencies is to develop and publish a policy and guidelines on conflict of interest. The advisory committee will review and approve the policy and determine how the policy is to be monitored for compliance.
I do not think that one can talk candidly about the Canada Communication Group without acknowledging its status as a special operating agency. I already noted at the Standing Committee on Government Operations that the concept of a special operating agency is an important one but should be reviewed. I am looking at the issue of special operating agencies with my colleague from the Treasury Board. We need to re-examine the purpose of special operating agencies and the type of government services which benefit most from being structured along those lines.
I fully expect that the special operating model as structured by the former government will come under further scrutiny and reviews which are now presently under way.
In closing, I want to assure all hon. members that their input on the review of future options for the Canada Communication Group will be welcomed. It is my hope and expectation that a full and frank discussion will evolve and that the Canada Communication Group and the Government of Canada will emerge even stronger as a result of this particular process.