Mr. Speaker, I am pleased to rise today to speak to Bill C-344, an act that would provide the minister with the authority to require an assessment of the benefits a community would derive from a construction, maintenance, or repair project. The bill's author, I am sure, has good intentions behind bringing the bill forward, but we all know where the road paved with good intention leads.
The practical considerations of federal procurement and the effects of more regulations on small and medium enterprises when entering into the federal bidding process cannot be ignored. The federal procurement process is one of the most complex processes in government. It takes months to finalize an RFP, solicit bids, modify the RFP, narrow down bidders, and negotiate a contract, all to finally accept a proposal that could very well be cancelled or delayed. I am not sure it would be possible to design a more convoluted system if we tried, although it appears that the government has been working very hard to ensure that nothing surpasses it.
For example, the bid from Alenia Aermacchi North America weighed some 2,700 kilograms, while Airbus Defence and Space needed a U-Haul to deliver 1,500 kilograms of documents to Public Services and Procurement Canada for the fixed-wing search and rescue bid. Even with such a detailed RFP process, the government has managed to get us sued for not providing proper information to the bidders.
One of the significant reasons federal procurement has become so complex is that politicians have seen fit to increase the number of conditions required before a contract can be awarded. Some of the conditions are to ensure greater financial transparency and are objectively good and practically necessary to prevent corruption. However, some conditions, like those proposed in Bill C-344, are well-intentioned but serve only to make a complicated process more complex. It is one thing to propose that companies submit a community assessment as part of their bid, as per proposed subsection 20.1(2) of the legislation, but it is completely another thing to allow such ambiguous power to sit with the minister. “The Minister may...require bidders...to provide information”, it reads. It is not “always”, but “may”. It is not if the contract is this size or that size.
What better way to open this up to lawsuits than to give the minister such an undefined power? Who is to decide what is the best social benefit? What parameters are to be used to decide if an environmental benefit from one bidder is superior to another but provides no social benefit? Who decides if a slight social benefit outweighs a much lower price and therefore gets the contract? What is to stop the government from using such vagueness for partisan benefit?
Here is a list of investigations of actual issues that have arisen and have been published on the website of the Office of the Procurement Ombudsman. There are 31 posted, and all but five concern issues that would be made worse by such undefined items in Bill C-344. They read:
1. Ombudsman recommends compensation to bidder who was treated unfairly
With Bill C-344, we would have an unclear process.
2. Request for proposal with unclear estimates impacts a bidding process
3. Departmental delays impede a supplier’s ability to submit a bid
4. Were contractual obligations met by the federal organization?
6. The onus to demonstrate how a proposal meets the evaluation criteria...
Again, that goes right back to Bill C-344 and its vagueness.
7. Organization properly awarded the contract, but may have unnecessarily limited the pool of potential suppliers
8. Compensation recommended for a supplier whose proposal was improperly rejected
10. Poorly written solicitations can cause confusion for suppliers
11. Department's approach to soliciting proposals was not consistent with government policy
12. Was a supplier disadvantaged by an unreasonable criterion?
13. A mandatory criterion questioned
15. Excessive criteria for the work to be done?
The list goes on. I am not even halfway through.
16. Department did not indicate the basis of selection to award a contract
17. Compensation recommended for supplier whose bid was wrongfully rejected.
This goes back to who is deciding on a social benefit versus an environmental benefit.
18. Did the department adhere to the terms and conditions of the Standing Offer?
19. Are subject-matter experts required to evaluate proposals?
20. Supplier's bid wrongfully deemed non-compliant on the basis of undisclosed evaluation criteria
21. Did a department act in a fair, open and transparent manner?
22. Were suppliers discouraged from bidding and others given an advantage?
23. Evaluation criteria not applied as stated in the bid solicitation
24. Did the department evaluate supplier bids using the same criteria?
Again, there are no criteria set out in Bill C-344.
25. Mandatory bid evaluation criteria not identified or applied appropriately: Supplier compensated
This goes back to the Minister “may” ask for such information but not always.
26. Did solicitation documents include contradictory wording?
27. Was there a conflict of interest or unfair advantage in the award of the contract?
30. Mandatory evaluation bid criteria based on operational requirements but the rationale not communicated
31. Department did not act in bad faith but need for better communication
What is the cost going to be for taxpayers? In the operations and estimates committee, we asked both the deputy minister and the associate deputy minister of Public Services and Procurement Canada if an analysis had been done of the effects of Bill C-344 on costs from the added red tape and bureaucracy, etc. Shockingly, for a government that goes on ad nauseam about evidence-based decision-making, neither had heard of Bill C-344, nor could they say if any analysis had been done on possible effects on the procurement process.
Seeing as the minister is on leave and her fill-in has been AWOL on such issues as Phoenix, the fighter jet procurement disaster, and the Shared Services paper shredding scandal, it is no surprise to see that this bill has had zero investigation into the ramifications.
I am not the only who opposes adding bureaucratic red tape to a process that is already the gold standard for red tape. The Canadian Federation of Independent Business says:
Attempts by small and medium sized enterprises (SMEs) to access federal procurement are consistently hampered by a confusing application processes, excessive paperwork and a complex system of rules.
One of the CFIBs suggestions was, “Make the procurement process an integral part of any red tape reduction initiative.” Note that it did not say to please add to the red tape.
The practical considerations of more bureaucracy are very real. The procurement ombudsman states that one of the continuing problems is that the complexity of the system scares small and medium-sized businesses away from engaging in federal procurement. In his 2015-16 annual report on procurement, the ombudsman noted examples of complaints from suppliers:
Cumbersome and burdensome solicitations, more specifically the amount of paperwork and time required to respond to solicitations, act as disincentives for suppliers.
Short bidding periods make it difficult for suppliers to respond to the often extensive requirements in solicitations....
Communications barriers or challenges, including in obtaining debriefs from federal organizations on the shortcomings of unsuccessful bids after the award of contracts or concerns about a perceived lack of details provided through debriefs....
Delays in launching procurements, or lengthy procurement processes, are resulting in increased costs for suppliers and federal organizations.
Take each item and relate it to Bill C-344's effects on the process. I cannot see how the legislation would make RFPs less cumbersome, less expensive, or less extensive or provide more clarity. Again, Bill C-344 ignores the existing problems within procurement and will increase complaints from small businesses.
As mentioned, Bill C-344 is vague in that it does not clearly define what constitutes a social, economic, or environmental benefit a community derives.
This problem of disincentives touches on another complaint heard by the procurement ombudsman, who noted that new businesses are unable or unwilling to break into the procurement market because of the substantial knowledge barrier to entry.
I support small and medium-sized businesses and believe that the government should be doing more to encourage SMEs to submit bids, create jobs, and grow our economy. Adding more requirements, bureaucracy, and ill-defined powers are not ways to bring down costs, simplify the process, and address the consistent concerns brought forward by businesses on the procurement process.
The minister's own mandate letter states:
Modernize procurement practices so that they are simpler, less administratively burdensome....
Bill C-344 would move government procurement in the exact opposite direction. The government should read the Prime Minister's own mandate letter to the Minister of Public Services and Procurement and reject this bill.