Debates of May 19th, 2022

Public Works and Government Services—Main Estimates, 2022-23

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, I have to get back to the member with respect to the specific cases. I do not have the exact number of specific cases available to me at this moment.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Mr. Chair, a simple analysis will show that Shared Services Canada purchased more than $900 million in Cisco products, either directly through Cisco or from its resellers.

How many open and generic tenders for network devices, including LAN switches, routers or Wi-Fi devices, have been won by Cisco resellers in Canada since Shared Services Canada was established?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, with respect to the number the member has referenced, we do not have that number. I would ask the member to provide us with information as to where she received that number, and we will follow up with her with respect to her question.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Mr. Chair, I am talking about figures from 2011, not just from this year.

We often hear that the government's computer network is outdated. How can this be the case when we are investing hundreds of millions of dollars in network contracts?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, we have a strong network. It is the applications we are working on, and we are going to continue to make those investments.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Mr. Chair, has the government hired professional vulnerability testers, commonly known as hackers, to ensure the security of government data and people's personal data?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, this is actually under the direction of the Communications Services Establishment.

[Mark Gerretsen, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons (Senate)]

Mr. Chair, I appreciate the opportunity to address committee on an extremely important and long-standing issue.

Our government is committed to eradicating forced labour from our supply chains. As we all know, these horrendous practices are as prevalent today as they have ever been. We have all heard the numbers.

The International Labour Organization estimates that some 25 million people are subject to forced labour around the world every day. That is every single day that the most vulnerable citizens of the world, young and old, are subject to what amounts to modern-day slavery, and we have all heard the reasons.

Forced labour spreads in countries where institutions are corrupt, where governments do not provide oversight, where workers lack the protection of labour laws, and where journalists are persecuted for reporting on it. We should be nothing less than completely outraged by this, and I know that we all agree that there is no place in the world for these human rights abuses.

However, the fact is that these practices are inextricably linked to global supply chains. We cannot participate in these supply chains without doing our part to ensure their integrity. We have a duty to act with a whole-of-government approach and in collaboration with our international partners to truly make an impact.

Of course, the pandemic has made us all too aware of hyper-competitive markets, and a stretched global supply chain can foster forced labour. At the beginning of the pandemic, we knew that we had to act quickly in a highly competitive global market to literally save lives, and we did just that, but we must acknowledge that a strained global supply chain increases the risk of goods having been produced using forced labour. We all know that this is completely unacceptable, and there is no doubt that the pandemic has had a devastating, disproportionate impact on the world's most vulnerable citizens. That very much includes those who are already victims of forced labour.

If we come up with any solutions, Canada must be part of a concerted global effort, and that is why this government is strongly committed to co-operation at the international level as a means of eliminating forced labour from our supply chains. I will give a few examples of how Canada continues to work diligently with our international partners.

We have been working with the United States and Mexico to prohibit the import of goods produced with forced labour. Canada is working with the European Union as well, to combat the forced labour of workers at sea. We have been working with our allies in multilateral institutions to use all means available to protect individuals from forced labour and remove it from supply chains. We are also sharing information and best practices with other countries that are just as committed to this fight against forced labour. The government is taking a whole-of-government approach through the national strategy to combat human trafficking to eliminate this scourge.

Additionally, the customs tariff has banned the import of goods that are mined, manufactured or produced by forced labour into Canada since 2020. To enforce that tariff, the Canada Border Service Agency is in charge of intercepting goods suspected of being produced using forced labour. The agency, Employment and Social Development Canada and other departments are working collaboratively to advance the effective operationalization of the ban. Of course, Public Services and Procurement Canada has an important role to play at the forefront of this, as the minister has outlined in her opening remarks today.

We know that all of these activities may prevent the products of forced labour from coming into our country, but they cannot stop forced labour from happening in the first place. The workers have already been exploited; the bottom lines of those businesses are not permanently affected, and the cycle of abuse continues. We need to do more, and we know that our actions must be concrete. That is why the government is taking more substantive measures to ensure that we are not doing business with suppliers or subcontractors that use forced labour. To that end, Public Services and Procurement Canada has taken the lead in maintaining the highest ethical standards for government procurement.

As part of the national strategy to combat human trafficking, the department updated the code of conduct for procurement to clearly outline Canada's expectations for suppliers when it comes to human rights and labour rights. The department is also working with its network of suppliers to ensure that they comply with international labour and human rights laws. It is doing so by engaging with suppliers of higher-risk goods and encouraging them to take action against companies in their supply chains that break these international laws. As Canada's central purchaser, the department has made information available to government suppliers about the 2020 amendments to the customs tariffs that ban the import of goods that are mined, manufactured or produced by forced labour.

In addition, as of November of last year, all goods-related contracts awarded by Public Services and Procurement Canada now contain anti-forced labour clauses. That means that the department can terminate contracts where there is credible information that goods have been produced in whole or in part by forced labour or human trafficking.

I will note that, in some cases, companies may not know that there may be forced labour in their supply chains, so before terminating a contract, procurement officers will try to work with a company to correct the situation. This is intended to protect the individuals subject to forced labour, who may become even more vulnerable from these actions.

These are concrete actions that will help in the fight against forced labour around the world, but the issue is a complex one, and the injustices and horrors of forced labour are not always immediately seen, often being well hidden by design and actively overlooked. The fact is it is still extremely difficult to prove that forced labour or child labour were used in the production of products, particularly because they tend to occur in parts of the supply chains that are not always open to scrutiny. That is why the government is implementing a number of additional measures to improve the integrity of our procurement system.

We want to shine the light on forced labour and its many victims so that it cannot be ignored. As part of this sustained effort, we have conducted a risk assessment of forced labour in goods procured by the government. This risk assessment is an important step to help determine where supply chains may be vulnerable to forced labour, and the results are providing us with the evidence we need to adjust our approach to tackle the problem into the future. This includes the work to explore and map human rights due diligence obligations and compliance monitoring used internationally. This will inform us as we develop policies in the future to safeguard federal procurement supply chains.

We are taking action, but we know there is so much more to do. The mandate letters to the Minister of Labour, the Minister of Public Safety, the Minister of International Trade, Export Promotion, Small Business and Economic Development and the Minister of Public Services and Procurement demonstrate that combatting forced labour is a major priority for our government. I am certain that my colleagues agree that we cannot stand on the sidelines, nor can we tolerate forced labour in any form, anywhere in the world. We must act, and I know that Canadians expect no less from us.

Our government is wholeheartedly committed to upholding human rights and international labour standards. We will continue to make sure that goods produced by forced labour do not enter Canada, bring integrity to our supply chains, and maintain the highest ethical standards for government procurement. For all of the victims and survivors of forced labour around the world, Canada is working to be a leader in efforts to eradicate labour exploitation. I can assure the committee that our government will continue to work with partners across the globe to rid our supply chains of the tragedy and anguish caused by forced labour.

If it is permissible, I will now move into asking questions of the minister.

Child labour, forced labour, and even slavery, as hard as it is to believe, are scourges that still exist in today's world. While Canada and the Canadian government do not condone or support the use of these in any way, products made under these conditions are sold on the international market, and it is not always clear or easy to distinguish which ones are made using ethical procurement and which ones are not. While the government does look to Canadian suppliers and manufacturers first when procuring necessary products on behalf of the Canadian people, there are some products that are available only from overseas suppliers. Canada believes in open markets and trades with countries across the globe for an assortment of goods. Although not all labour standards are equal to those in Canada, and not all workers' rights are the same as those in Canada, that will not stop the Canadian government from doing its utmost to avoid supporting in any way the overseas suppliers and manufacturers that exploit workers and children in order to produce their products.

I would like to emphasize again that this government realizes that in order to have ethical procurement, it needs to be proactive in determining whether the suppliers it enters into contracts with are abiding by the codes of conduct set out not only by this government, but by a number of international human rights and labour organizations. Price and quality control cannot and will not be the only determinant by which this government does business with overseas suppliers. We respect human rights and labour rights at home and will do our best to support them abroad also in our procurement practices.

Can the minister please detail the measures that this government has taken with regard to the issues of labour exploitation and forced labour when dealing with procurement of goods, especially from overseas suppliers and manufacturers?

[Filomena Tassi, Liberal, Minister of Public Services and Procurement]

Mr. Chair, as I have indicated previously this evening, this is an area that is very important to me.

As the government's procurement authority, PSPC is committed to ensuring that human rights and labour standards are protected and that ethical practices are maintained by suppliers and manufacturers from which we procure vital goods, such as personal protective equipment. Notably, PSPC requires bidders responding to tenders for PPE to certify that they and their first-tier subcontractors comply with a set of fundamental human and labour rights requirements and are free from forced labour discrimination and abuse, with access to fair wages and safe working conditions. This requirement builds on PSPC's policy on the ethical procurement of apparel, which since 2018 requires apparel suppliers to certify that they and their direct Canadian and foreign suppliers comply with a set of fundamental human and labour rights.

In July 2020, clauses on ethical procurement and origin of work were added into the new PPE contracts and in all newly issued requests for proposals for personal protective equipment. The origin of work clause requires bidders to provide the name, address and country of the manufacturers of the item, including subcontractors. The ethical procurement clause requires bidders to certify that they and their first-tier subcontractors comply with the same human rights and labour standards as set out in the policy on ethical procurement of apparel.

PSPC has made changes to strengthen its contractual framework and has also updated the code of conduct to include new expectations for suppliers and their subcontractors on human and labour rights. It also has implemented new anti-forced labour contract clauses to ensure that we can terminate contracts in the event of violations. These clauses protect the department from financial liability if imported goods are not released at the border because their importation is prohibited under the forced labour prohibition in the Customs Tariff Act.

In addition, PSPC works closely with other government departments, such as Employment and Social Development Canada and the Canada Border Services Agency. At CBSA's request, ESDC labour provides support by conducting research and analysis on the risk of forced labour for specific complaints or allegations received pertaining to the forced labour import prohibition administered by the CBSA.

Given the complexity and scope of the problem, addressing forced labour will take sustained effort over time. As the member mentioned, four ministers have in their mandate letters the commitment to eradicate forced labour through legislation.

We look forward to doing more in this very important area.

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Chair, a number of questions have been raised regarding Nuctech and whether contracts were awarded to the company. There may be questions regarding contracts awarded through Public Services and Procurement Canada as a department and as a common service provider. Can the minister clarify if contracts were awarded to this company?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, with regard to Nuctech, I can confirm that Public Services and Procurement Canada as a department does not have any contracts with Nuctech. That was the point that I was making earlier, that we currently do not have any contracts.

As a common service provider in the past, PSPC undertook competitive procurements on behalf of the Canada Border Services Agency, and four contracts were awarded to Nuctech, the most recent being in 2019. However, since that time there have been no new contracts awarded to the company, so there have been no contracts from 2019 to the current time.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, I am going to share my time with the member for Louis-Saint-Laurent.

I thank the minister for her work tonight. It is quite a feat to put in all the time and to answer all the questions, and I thank her for that.

Andrew Kendrick, a naval architect with 40 years' experience, appeared before committee. His statement was that it costs three to five times the world price and two to four times longer to deliver ships in Canada versus the rest of the world. Does the minister have any comment on that? Has she investigated and verified this to be true, or does she feel we are in line with world price and world delivery?

[Filomena Tassi, Liberal, Minister of Public Services and Procurement]

Mr. Chair, there is no question that COVID has presented challenges, and the shipyards are no exception to that. These challenges have involved problems with getting labour, as well as supply chain issues, and there is no question that that has resulted in some delays and some costs. I would confirm that.

I think the testimony the member is referring to was not testimony that was given by everyone, although I can appreciate that there may have been a person who gave that specific testimony.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, he was the project manager from 2007 to 2010 for AOPS, so I think he is very well informed. The surface combatant went from $14 billion to $26 billion to $56 billion. The Parliamentary Budget Officer says it could be $77 billion.

At what point does the minister say we have got to slow down here and we need to go line by line to understand how this has quadrupled or gone up even more?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, just to be clear, one price is with taxes and the other is with the exclusion of taxes. On projects of this magnitude, we have to understand and appreciate that.

With respect to the procurement of projects, I have said with the national shipbuilding strategy how committed I am to this strategy. The economic benefit that this has provided for Canadians and the 18,000 jobs that it is creating or maintaining annually are extremely important. We are going to continue to support this strategy.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, I have no question at all about the economic benefits. I have no question about how hard the workers work in all the shipyards. The same work is getting done around the world using the same steel and the same technology, yet Canada still pays four to five times the amount.

Will the minister look into this and find out how this can be?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, what I would say with respect to that question is that shipyards around the world are experiencing the impacts of COVID-19 and, as I have said, there are labour shortages and supply chain issues. There are a number of issues that have added to the complexity here.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, that is fine. She also mentioned tax. There is not $40 billion worth of tax on a $14-billion project, unless taxes are really being hiked in the future. Another one is the offshore oceanic vessel. The original price tag was $100 million, and now it is $1 billion. How do we have a ten bagger on a project? That seems like mismanagement.

The other question is this: Will she open the books to the Parliamentary Budget Officer so he can go through them? He had to use U.S. numbers to come to his conclusion of $77 billion.

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, we are transparent on contracts. We are open and transparent on those contracts, and those numbers are available.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, if one comes to committee, they will find out the Parliamentary Budget Officer did not have that much help and he did not really feel like it was transparent. He said that in his statements.

One other question I have is about ArriveCAN. How much did ArriveCAN cost the taxpayers of Canada, from the concept to the product being used today? How much did ArriveCAN cost?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, that is with CBSA, not procurement.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, is the procurement minister saying that her department had nothing to do with procuring the ArriveCAN app?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, not with respect to the app. There may be services that have been related, but not with respect to the actual app.

[Ben Lobb, Conservative, Huron—Bruce, ON]

Mr. Chair, we definitely need some further investigation on it. On COVID vaccines, Moderna was originally pegged at 35 million doses per year. It is now 25 million doses for 2022. It went from 35 million to 25 million.

Why was there a decrease of 10 million doses?

[Filomena Tassi, Liberal, Hamilton West—Ancaster—Dundas, ON]

Mr. Chair, what I would say to that is that in 2021 there were 35 million doses and in 2022 there were 20 million doses.