Colleagues, I will call this meeting to order. Paul has very graciously provided some speaking notes for me, which I will go over with you before we officially start the meeting.
I'd like to welcome you to meeting number seven of the House of Commons Standing Committee on Government Operations and Estimates. Pursuant to the order of reference of Saturday, April 11, 2020, the committee is meeting on its study of the government’s response to the COVID-19 pandemic.
Before we start, let me just say that I noticed, when seeing all of my colleagues in attendance on the video conference, that many of you must be anxiously awaiting the reopening of barber shops across the country. I hope that happens within the next few weeks.
Colleagues, I would also like to announce the schedule for committee meetings for next week. This has been approved by the whips, although I'm sure it's subject to change. Our first meeting will be on Monday, May 4, from 2 p.m. to 4 p.m., eastern time. On Friday, May 8, we will meet from 11 a.m. to 1 p.m., eastern time. Now, that has been a change. I believe all of you, however, were notified by your respective whips and by the House a little earlier this week.
Based on the discussion at the last meeting, the analysts have prepared a revised work plan, and it was distributed to all members of the committee this last Tuesday. As OGGO will be meeting on Monday, it is very important that the committee review that work plan and give the clerk some guidance on who should be invited to appear on Monday and Friday of next week. We only have a few days, so if there are additional witnesses, or if you want to make major revisions to the work plan, the clerk would appreciate it very much if you could get that information to him immediately.
At 2:50 p.m., or approximately 10 minutes before we conclude the first hour of this afternoon's meeting, I will be suspending the meeting and dismissing the industry officials, who will be with us for the first 50 minutes, as we consider the work plan. The analysts took all the suggestions that were made by members at our last meeting and combined them into a revised work plan. This was distributed to the committee on Tuesday. Before we set up the witnesses who will appear from 3 p.m. to 4 p.m., I would like to have some conclusion and some agreement as to the work plan as suggested. If there are any major changes, we will try to deal with that before we get to the second hour of this meeting. We are not going in camera at any time. All of the discussions will be completely in public.
Pursuant to the order made on April 11, the committee cannot consider any motions except for those “requesting or scheduling specific witnesses, and these motions shall be decided by way of a recorded vote”. We can consider this work plan and make changes to it as long as it deals with the subject matter of the COVID-19 pandemic and the government's response to it.
Now, as you know—we have discussed this individually—earlier today the clerk sent out some guidelines about interpretation and how to use the interpretation channels during the meetings. If you are going to be speaking in English, we encourage you to make sure you click on the English channel. If you are going to be speaking French, click on the French channel. If you are going to be alternating between English and French, we would ask that, as you change languages, you pause for a moment or two to allow the interpreters the chance to switch channels.
Our first set of witnesses will be from the industry department. We have with us Mr. Simon Kennedy, deputy minister, and Mr. Paul Thompson.
Gentlemen, welcome to our committee.
Mr. Kennedy, the floor is yours.
I'm very sorry about this.
I was just on with the industry committee and things were working fine, so I'm hopeful it's not my equipment. I have a high-speed connection here.
I was going to say, just as all departments have been called on to protect Canadians and our economy during this extraordinary time, Innovation, Science and Economic Development has been working hard and trying to do its part to deliver a strong, immediate and effective response.
I have witnessed a deep commitment within my own and other departments to do what it takes to help individuals and businesses manage the economic disruption caused by this pandemic. I've had the privilege of working closely with colleagues in other departments and agencies to help mobilize Canada's industrial and research communities as part of these efforts.
Since the government's call to action to Canadian business about six weeks ago, nearly 6,000 Canadian companies have offered their expertise and capacity to help combat COVID-19 by retooling, scaling up or providing urgently needed goods and services. ISED has been moving swiftly to work with these companies to help build a secure domestic supply of key personal protective equipment for Canada's front-line health workers as they fight the pandemic, and we have shifted the focus of our business innovation programs to directly target COVID-19.
We are accelerating applications and the approval process so that projects can get off the ground quickly to address the most urgent issues, and we are making progress through our strategic innovation fund, innovation superclusters, the innovative solutions Canada program and the National Research Council's industrial research assistance program.
Through these programs. ISED is helping meet the urgent needs of health care workers for equipment such as masks, face shields, medical gowns, ventilators and test kits. For example, funding from the National Research Council's IRAP helped Ottawa's Spartan Bioscience fast-track the certification process for its COVID-19 test kit.
Following a call-out to its more than 970 members to develop and scale up new health products and equipment, the Next Generation Manufacturing Canada supercluster has already reviewed and conditionally approved seven projects for ventilators, test kits and face shields. To take a final example, Innovative Solutions Canada has received a tremendous response from SMEs across the country to its challenge and testing streams focused on a response to COVID-19. These initiatives will be moving into selection and funding faster than ever before.
Throughout all of this work, we have been in lockstep with Health Canada, the Public Health Agency of Canada, Public Services and Procurement Canada, and others. PSPC has been instrumental in leading significant investments to increase Canada's supplies of critical equipment for the health care sector. With a coordinated strategy among these departments, we are maximizing the contributions of federal innovation programs as part of Canada's response to this extraordinary challenge.
Complementing these industrial contributions and those of our science and research community, there is no denying that Canada must act quickly to accelerate promising research aimed at treatments and a vaccine for COVID-19. That is why the ISED ministry has been working diligently with Canada's world-class science and research community in taking on this challenge. The results of this work will be accessible to researchers around the world to advance the global fight.
Organizations such as the NRC and the Canadian Institutes of Health Research have received federal funding to conduct COVID-19 research in important areas, such as diagnostic tools and vaccine candidates.
The University of Saskatchewan VIDO-InterVac facility has also received funding to help get clinical trials set up and running as soon as possible so that we can ensure no time is wasted in developing a vaccine to protect Canadians against potentially recurring waves of COVID-19.
Genome Canada has received funding for the new Canadian COVID genomics network to further its genome sequencing research and help scientists better track the virus, its different strains and its impact on patients. The research conducted by this network will also guide public health authorities and policy-makers in their efforts to curb the pandemic.
Finally, my department worked quickly to facilitate the establishment of a new $600-million COVID-19 stream under the strategic innovation fund. This stream will support vaccine and therapy clinical trials, as well as Canadian biomanufacturing opportunities.
ISED is working hard to support the scale-up of national platforms to develop and deliver a vaccine to Canadians when one is discovered, including support for manufacturing. Combined with efforts to mobilize industry, we are trying to do our part in the larger whole-of-government approach to protecting Canadians and preventing the spread of the virus.
We want to help ensure the capacity of our health care system as well as supporting international and domestic efforts. I'm proud ISED can contribute to the coordinated response, one that hopefully will allow Canadians to return to work, get the economy moving again, and set up our country for a rebound when it is safe to do so.
That concludes my remarks, Mr. Chair. Again, thanks for the opportunity to speak with members today. I would be, of course, pleased to answer your questions.
As part of the made-in-Canada approach, we're working very closely with colleagues at Health Canada and the Public Health Agency to try to ensure that we have sufficient domestic capacity on the testing front to be able to support the testing volumes that will be needed by the provinces and territories and the federal government.
I should maybe clarify for the committee members that the specific decisions on how many tests, what kinds of tests and where, and those sorts of things will be made by health authorities. In many cases, those will be provincial and territorial decisions. We obviously, though, want to have a sufficient quantity of testing materials to be able to do that as a country. That's an area where we're working very closely with the National Microbiology Laboratory, our colleagues at Health Canada, the Public Health Agency, and frankly the procurement ministry.
Again, to give you my layperson's explanation, you can think of testing as having very different kinds of tests. There's the lab-based PCR test. That's kind of the gold standard. It's lab-based testing. There are point-of-care tests. We're trying to work across all fronts. Basically, we're going through the list of ingredients and equipment needed for those lab-based tests that are being done and making sure that for every one of those things, we have some line of sight on whether there's Canadian manufacturing capability or whether those ingredients can be sourced in Canada. We don't want to be in a position where some vital constituent part of the test is from a country where there's no supply or it's unreliable or whatever. We're kind of going through the shopping list and making sure we have access to all the ingredients.
Thank you for that, Mr. Green. I appreciate the time. I'm sorry to hear that you're having technical difficulties. It's nothing like me getting caught out on the phone in the middle of Parliament the other day, where that shot of me was less than flattering.
In the industry committee meeting, I brought up Taiwan and the use of masks there for citizens in general. My brother lives and works in Taiwan. Everybody gets a mask as part of a rationing: three masks a week. My sister-in-law never stopped working, and my brother stopped teaching for two weeks.
Taiwan was one of the top 10 countries affected by COVID-19 at the very beginning. They had their first presumptive case the same day as Canada did. Now they're 114th on the list. They've had 429 cases and six deaths. They're not testing very much. They test 2,600 people per million, compared to Canada where we're at 20,000 per million. On masks and hand sanitizer, there's hand sanitizer in front of every building and at every transit station, and people wear masks in public places.
Here in my riding, Harmac Pacific creates K10S pulp, which is used for surgical masks, and they're exporting to the United States. These are really basic paper masks. They're not like the N95 masks.
I wonder whether the government has explored getting somebody to manufacture those types of simple masks here with that type of paper, working with our local pulp mill, to ensure that we have masks for citizens so that we can get people back to work.
You're very generous and you're very kind, and I'll leave that up to Mr. McCauley when we get into the second round.
Colleagues, I'll make just one last comment before I ask Paul to suspend, and then we'll get the other witnesses lined up for the second hour.
I mentioned this earlier to Mr. Drouin, I mentioned it to Mr. McCauley I believe yesterday, and I'll say it now publicly to you, Matthew, and to Madam Vignola. As long as we have witnesses and things we need to study, that's great. I'm comfortable with having as many meetings as are required. I did say to both Mr. McCauley and Mr. Drouin that I've never been a fan of having meetings just for the sake of having meetings.
I would like to make sure that the witnesses we have—and this is reflected in the work plan—are not redundant, have not already provided to a different committee the same same testimony that we would be hearing. I'm not trying to short-circuit this committee at all. I'm just saying that when we feel collectively that we have reached the end of the road in terms of receiving testimony, I hope we'll all come to some agreement, and then we can inform our whips that our time is up.
Just keep that in mind, colleagues. We may find as we go through the next meeting or two that new issues surface and that we do want to continue to study a little longer. We can certainly do that. It is up to the committee.
Mr. Clerk, I can see that your hand is raised.
Thank you to the chair and members for inviting me back to the committee. It is my pleasure to be here. I hope I can be of assistance.
I am joined today by the deputy procurement ombudsman, David Rabinovitch, who is also participating via Zoom from his residence.
I would like to begin my remarks by thanking Canada's health care workers who are on the front lines of this pandemic risking their own health and well-being to lead us through these difficult times.
I would also like to thank all the people who work behind the scenes and provide essential services to ensure that Canadians can eat well, and stay in a safe place.
I also thank the public servants at all levels of government, across Canada, who work tirelessly to ensure access to screening tests, medical equipment, personal protective equipment, financial assistance and other necessary supports.
Thank you to the IT, translation and administrative professionals who make it possible for us to work remotely, including enabling us to do the important work the committee is doing today.
Now, I would like to explain to you my role and mandate. I would like to explain my role within federal procurement as some of you may not have been here on the committee when I was last here, two years ago.
The Office of the Procurement Ombudsman opened in 2008 with a focus on providing small and medium-sized businesses an avenue of recourse for procurement and contracting issues. My office operates at arm's length from other federal organizations, including Public Services and Procurement Canada.
While I report the Minister of Public Services and Procurement, the minister has no direct involvement in my office's daily activities or the content of my reports.
Specifically my legislative mandate is, first, to review complaints regarding the awards of certain contracts for goods below $26,400 and services below $105,700; second, to review complaints regarding the administration of certain contracts regardless of their dollar value; third, to review the department's practices for acquiring goods and services to assess their fairness, openness and transparency, and to make recommendations for improvement; and fourth, to provide alternative dispute resolution, like mediation services when requested and agreed to by the parties to a federal contract.
As you can see, the mandate is quite specific. This is because the Canadian International Trade Tribunal has jurisdiction to review complaints about the award of contracts above these thresholds of $26,400 for goods and $105,700 for services.
Now I will talk a little bit about the Government of Canada and its COVID-19 response.
My office specifically has not been inundated by COVID-19 procurement and contracting related complaints. My office's key services, which are reviewing complaints about the award of lower dollar value contracts and providing contract mediation services, are more likely to be needed in subsequent phases of the recovery. When the office of small and medium enterprises asked for our help in responding to the over 26,000 calls and emails from suppliers looking to sell COVID-19 related products to the federal government, we immediately sent them several employees to assist in contacting these companies to move the process forward.
We have heard from some suppliers regarding COVID-19 issues, and I will briefly describe some of these interactions.
One supplier contacted us with complaints about the procurement processes for chartered evacuation flights. However, as the dollar amounts of those contracts were well above the threshold of my mandate, we let the supplier know that the CITT has jurisdiction to investigate these types of complaints.
We've also received inquiries from suppliers about selling hospital beds to assist with COVID-19 outbreaks; sending bulk PPE supplies to the government; waiving normal procurement requirements; selling disinfecting materials; selling medical masks; donating hand sanitizers, and how to sell the same in the future to the government; and how to purchase specific types of ventilators.
For each of these inquiries, just as with non-COVID-19 inquiries, we explain our mandate to the supplier in case they need our investigation services or our remediation services. We provide them with an answer directly or point them to a federal organization that can. For example, the companies that contacted us wanted to know who to call for masks and hand sanitizers. We directed them to the office of small and medium enterprises, which you will hear from next and which is specifically designed for this purpose.
We have not received any formal requests for mediation services in regards to either COVID-19 related contracts or other contracts that may have been impacted by the COVID-19 pandemic. As mentioned earlier, it is anticipated, however, that formal complaints and mediation request may come further down the road. For now, it's too soon, as COVID-19 related contracts are just being put into place.
Moving forward, to be proactive, my office is studying the issue of emergency contracting, both in terms of how the contracts are put in place as well as what transpires when contractual obligations cannot be met due to unexpected emergency conditions known as force majeure.
We intend to share our research with both federal departments and suppliers, to help all parties to federal contracts know how to proceed when crises such as COVID-19 happen. We also want to hear from all Canadian suppliers, including small and medium-sized business owners and diverse business owners, to learn about their experiences during this crisis so we can share the information broadly with contracting organizations.
As time passes, we anticipate receiving complaints from businesses that hoped to but did not obtain federal contracts during this crisis and mediation requests regarding existing contracts that were not completed due to the crisis. As always, we will be there to review these complaints and to provide our mediation services so that businesses and departments can get back to business. My office has a successful track record in mediating contract disputes, and I urge all of you and anyone listening to contact us for help in this area. I would welcome the opportunity to come back to this committee in the future to report back on our COVID-related work and findings.
In closing, I would like to thank committee members again for inviting me, and I would be pleased to answer your questions.
Good afternoon, Mr. Chair and honourable members of this standing committee, and thank you for having me here today.
My name is Lorenzo Ieraci and I am the director general of the office of small and medium enterprises at Public Services and Procurement Canada. Joining me today is Louis-Martin Parent, director for the national capital region.
Today I would like to focus my remarks on two areas. First, I will provide an overview of the office of small and medium enterprises, OSME, and how we work to assist smaller companies in federal procurement. Second, I will highlight how we are supporting the broader efforts of Public Services and Procurement Canada and the Government of Canada to acquire the equipment and supplies our front-line health care workers need in the fight against COVID-19.
Mr. Chair, let me begin by providing a brief overview of OSME. OSME was created in 2005 to specifically address the needs and perspectives of smaller businesses selling to the Government of Canada. Our organization has a network of six regional offices stretching from Victoria to Halifax. In addition to our regional offices, we also have a toll-free national information line, which companies can call if they have questions or need assistance.
Our dedicated team helps companies in a number of ways. First, we raise awareness of the fact that our organization exists and is a resource available to them for assistance. Second, we educate companies on the federal procurement process and on where to find information or opportunities. Third, we provide direct assistance to those interested in participating in federal procurement. In addition, we seek to advocate on behalf of smaller companies both within Public Services and Procurement Canada and, to the extent possible, with other federal organizations. Our goal is to identify and reduce barriers that smaller businesses can face when doing business with the Government of Canada.
Mr. Chair, OSME also encourages Canadian companies from traditionally underrepresented groups and helps them participate in federal procurement. To do so, we work with external stakeholders, partners and associations to reach their respective constituencies. We want to ensure that they are aware of OSME and the services we offer, so that the federal government can benefit from the great diversity of Canada’s business community.
We do all this through activities such as free seminars, webinars and one-on-one meetings. In essence, we try to make it as easy as possible for smaller businesses to reach us so that we can answer their questions and help them on their journey through federal procurement. In addition, we make information available through our website, buyandsell.gc.ca. This website provides information on federal procurement, as well as most tenders or solicitations undertaken by PSPC and other federal departments and agencies.
Moreover, OSME works with provincial and territorial counterparts to explore opportunities for collaboration. As a result, our department has signed agreements with 11 provinces and territories in support of the Canadian collaborative procurement initiative. The objective of this initiative is to allow provinces and territories to use our department's procurement instruments when it is to their benefit. During this pandemic, we have worked to make procurement instruments that may assist provinces and territories available to them. As you can see, OSME offers a lot of information, tools and resources to help Canadian companies, particularly smaller ones, to participate in federal procurement.
Mr. Chair, I would now like to briefly highlight how OSME is supporting the government’s efforts in combatting the COVID-19 pandemic.
On March 12, 2020, Public Services and Procurement Canada issued a call for action on the buyandsell.gc.ca website. The response has been enthusiastic. We have received more than 26,000 forms through our website, including roughly 16,500 from Canadians and Canadian companies.
In addition to communicating via email with Canadians and Canadian companies that have submitted forms, OSME has been working to reach out to speak to those who submitted forms. This is allowing us to obtain additional information on the goods or services that these companies are offering. We are capturing this information to help our procurement team assess and triage the information received. We also want to ensure that these companies are aware of our services. In essence, we want to encourage them to consider doing business with the federal government as we move through this pandemic and emerge from it. After all, the Government of Canada buys roughly 25 billion dollars' worth of goods and services annually, and there will be opportunities for many of these companies to do business with the Government of Canada moving forward.
Mr. Chair, even though OSME does not actually procure or issue contracts directly to companies, we are nonetheless engaged and working diligently to do our part during the pandemic. Although we have had to shift our focus in a temporary but complementary way, OSME’s mission remains the same. We want to help smaller companies do business with the Government of Canada and represent their views and interests within federal procurement.
In closing, Mr. Chair, I note that OSME is appearing alongside the procurement ombudsman and his office. As Mr. Jeglic identified, OSME and the office of the procurement ombudsman have had a positive and mutually respectful working relationship for years.
While always being mindful of the fact that the ombudsman and his office need to maintain a level of independence, we still collaborate when mutually beneficial. This is particularly the case when informing companies about the services that both our organizations offer to them. As we move through this pandemic, OSME will continue to remain focused on helping smaller companies do business with the Government of Canada.
Thank you for the opportunity to appear before you today.
As I indicated, of the 26,000 forms that have been submitted, roughly 16,500 of them are from Canadians or Canadian companies. We're following up with all of these companies to have conversations with them and to gain additional information.
The companies that came forward and submitted forms fall into two broad categories, generally speaking. Category one companies are those who are offering personal protective equipment. Category two companies are those offering other goods or services, which might not be personal protective equipment, but nonetheless might help the Government of Canada. I'll deal with category two for just a moment, and then I'll come back to category one.
When it comes to category two, we as an organization have been pointing out to companies that our department's primary focus right now is to buy personal protective equipment. Many of these companies that have come forward have identified goods or services that we as a government are likely to need moving forward. In this regard, we want to make sure, first, that they are aware of our office and that we can assist them in understanding federal procurement. Second, we want to make sure that they are also aware that they can register on an email notification service in two very simple and quick steps, which will keep them informed every time a tender is issued that is specific to the good or service they're providing.
This situation has given us the opportunity to reach out to a lot of these companies and to make sure they are aware of the services available to them.
I don't know that I would say we're necessarily marketing in any way, shape or form. I think the fact that our website has been available and the fact that we've received such an enthusiastic response demonstrate that Canadians and Canadian companies are keenly aware of the fact that there's a need domestically to be able to have as much product as possible to be able to assist, not just our front-line workers, but all Canadians as well.
We want to make sure that, as companies come forward and identify their capabilities or products, we're reaching out to them as quickly as we can, as I mentioned, to be able to obtain more information on what they have available and the quantity of the products. Then we're sharing that information with our procurement colleagues.
The other thing I would say is that as an organization, one of the things we're also doing is reminding Canadian companies that, of course, while we're always interested and hope that Canadian companies will think about doing business with the Government of Canada, we are not the only entity right now that is buying personal protective equipment and other equipment. Our provincial and territorial counterparts are looking for some, as well as hospital groups and other groups.
Of course, we're encouraging people to be able to make available as much product to as many different people as possible, because at the end of the day, having more product available within Canada is a benefit to all of us.
Thank you very much for your question.
As I mentioned earlier, there are many activities underway related to the modernization of federal procurement that we are sharing with small and medium-sized enterprises when we have an opportunity to discuss them. Of course, not all of these activities are completed yet, but our department has taken some fairly significant steps. I'll give you two examples.
First of all, over the past year, we undertook a major effort to simplify contracts to make their wording and structure easier for companies to understand. In the past, companies have told us that they received documents where information pertinent to them only started on page 75, so the structure may not have been the right one. We already have drafts, and our department was in a position before the current crisis to start using these new approaches to procurement. I hope we'll be able to continue to do that.
My second example is the work the department continues to do to develop a digital platform related to procurement. We want to migrate from our current system to a digital and automated system, and this project is also continuing to move forward.
Yes, I would like to make a comment, if you don't mind.
One of the positive things we've seen is more standardized documentation. It frustrates small and medium-sized businesses to no end that every process looks and feels different. That applies across the federal government, but now, one of the unique opportunities that the COVID-19 crisis has created is this enhanced collaboration between the federal government, provincial governments and municipalities.
That has also been a point of frustration. Oftentimes, suppliers to the federal government are also dealing with their provincial government and municipal government. If there could be increased standardization, that again helps those small and medium-sized businesses that don't have the money to hire a proposal writer to help them respond to these complex RFP demands. I believe Mr. Ieraci pointed to one of the collaboration initiatives that will enhance that standardization.
That's absolutely something positive that we're seeing, but there is no end to simplification. I attest to the fact that every time you go over one of these documents, it is still a difficult read, so it needs to be a continued point of emphasis for this committee as well.
Colleagues, as I am fond of saying on many occasions, when I give an intervention opportunity for a committee member, it's for both the question and the answer.
Unfortunately, Mr. Fergus, we have absolutely no time left for an answer to your question. However, I suggest to both of our presenters today that if there are any unanswered questions, or if you have responses that you did not have an opportunity to answer at this committee level, please provide written responses to our clerk, who will distribute them to our committee members.
Colleagues, that concludes our testimony for this afternoon because we have a very tight timeline and our technicians must be able to get over to set up for the next Zoom video conference starting in approximately one hour.
I will excuse both of our witnesses. Thank you very much for your presentations. Your information was greatly appreciated and extremely useful.
Colleagues, we will now adjourn and will reconvene and see each other tomorrow at 11 a.m.
We are adjourned.