PACP Committee Report

Recommendation 1:

That National Defence clarify its action plan to ensure that it has measures in place as soon as possible to appropriately manage urgent operational requirements.

In the action plan presented to the Committee on March 30^th, 2010, National Defence outlined a number of measures it had taken, was taking, or planned to take to improve its management of urgent operational requirements.

Action Plan Measure: review its Project Approval Guide with a view to improve how it manages the process of acquiring urgently-needed equipment while respecting sound project management principles and Treasury Board policies. 

National Defence has made progress to align its existing documentation requirements for procurements greater than $1 million with the project approval framework as outlined in the Project Approval Guide.  National Defence has also begun work to revise its Project Approval Guide and will engage the Treasury Board Secretariat in consultations once a substantive draft has been finalized.  The revised guide will incorporate interim guidance for Unforecast Operational Requirements, which was published in June 2008 and outlines the minimum essential documentation required for urgent acquisitions.  Additionally, where appropriate, the revised guide will be updated to address the issues raised by the Auditor General.  A progress report on the revised guide was briefed to National Defence’s Programme Management Board on December 15^th, 2010.  Its target date for final approval is now September 2011. 

Action Plan Measure: involve Public Works and Government Services Canada earlier in urgent acquisition processes.  

National Defence and Public Works and Government Services have undertaken measures to improve the already close collaboration between the two departments.  For example, the Acquisitions Branch of Public Works and Government Services has been granted full membership in several standing and ad hoc National Defence bodies that oversee the planning of future acquisitions, both routine and urgent.  National Defence and Public Works and Government Services continue to use an agreed upon responsibility matrix, which is reflected in both departments’ procedure manuals, to further clarify roles and responsibilities.  Lastly, National Defence has completed an in depth review of its current procurement processes and practices which identifies other areas in which cooperation could be enhanced.  National Defence and Public Works and Government Services continue to collaboratively explore further opportunities for enhancing defence procurement. 

Action Plan Measure: develop a procurement process model for urgent military acquisitions.

National Defence has completed a revised process model for urgent defence procurements. 

Action Plan Measure: revise the Land Staff’s strategy for urgent acquisitions to ensure sufficient quantities of vehicles and equipment are reserved for training without reducing the number available for operations. 

The Land Staff has revised its strategy for urgent acquisitions in an effort to mitigate the risks associated with unforecasted operational requirements.  At the outset of a procurement project, the Land Staff now use revised assessment models to better define what is required to build, generate, employ and sustain a new capability.  Additionally, the Directorate of Army Training, Corps Schools and Centres of Excellence now play a greater role in determining what is required to train personnel on an emerging capability.  Determining the necessary quantity of vehicles or equipment required to train personnel helps ensure that enough of a capability is acquired, which in turn ensures that sufficient quantities of vehicles or equipment are reserved for training without reducing the number available for operations.  Revised procedures to closely monitor training stocks to synchronize the movement of equipment and/or personnel to aid in the preparation for operations have also been implemented.  When not possible or advantageous to have a training stock, due to limited availability, limited value or costs, the Land Staff will work with operational commanders to develop “in-theatre” training strategies whenever feasible and where risk is acceptable and training facilities exist. 

Recommendation 2:

That National Defence provide a status report to the Public Accounts Committee by 31 January 2011 on its progress in addressing the recommendations made by the Office of the Auditor General in Chapter 5 of the Fall 2009 Report; and that National Defence continue to provide annual status reports until all of the OAG’s recommendations have been addressed.

The Government accepts this recommendation and will provide annual status reports to the Auditor General until all of the OAG’s recommendations have been addressed.  Additionally, DND will report on progress to meet the OAG’s recommendations in its Departmental Performance Report, until all of the OAG’s recommendations have been addressed.

Recommendation 3:

That Public Works and Government Services Canada and the Treasury Board of Canada Secretariat together develop criteria and guidelines by 31 December 2010 for how to manage urgent acquisitions.

The Government accepts this recommendation.  Public Works and Government Services, with input from the Treasury Board Secretariat, has developed and posted on the internet a Policy Notification establishing a new section in the Public Works and Government Services Supply Manual on “Managing Urgent Acquisitions”, effective December 20^th, 2010.  The purpose of this policy notification is to update the instructions to contracting officers on the process to acquire goods and services when there is an urgent requirement. 

The policy notification defines what is considered an urgent requirement and provides strategies to expedite the procurement process when a requirement is considered urgent.  It stresses the importance of engaging Public Works and Government Services early in a process, developing an integrated approach and early engagement with industry and other stakeholders.  It states that concurrent review processes should be established and used whenever possible.  Where project approval is required from Treasury Board, but has not yet been obtained, consideration will be given to developing a joint Treasury Board submission signed by both the Minister of Public Works and Government Services and the minister of the client department, that will seek project approval and contract approval at the same time.

Recommendation 4:

That National Defence ensure that key decisions for urgent operational requirements are adequately documented, as was noted by the Office of the Auditor General in recommendation 5.83.

The Government accepts this recommendation and has begun to work towards implementing it. National Defence issued interim guidance for Unforecasted Operational Requirements, which outlines the minimum essential documentation required for urgent acquisitions.  Additionally, National Defence is reviewing its project approval process to ensure that relevant information is not excluded when project approvals are being fast-tracked for urgent projects.  To that end, National Defence is revising its Project Approval Guidance and will engage the Treasury Board Secretariat in consultations once a substantive draft has been finalized.  The revised Project Approval Guidance is expected to receive final approval by September 2011.