I call the meeting to order.
Greetings, everybody, and welcome.
It's so nice to hear other people enjoying the nice weather and seeing that around. If you want to come to Saskatchewan, you're welcome to deal with the snow that we're dealing with there, but that's okay; we'll leave that alone.
Welcome to meeting number 16 of the House of Commons Standing Committee on Government Operations and Estimates.
Today we will hear from the Minister of Public Services and Procurement and officials regarding the main estimates 2022-23, the departmental plans and her mandate letter.
Today's meeting is taking place in a hybrid format, pursuant to the House order of November 25, 2021. Members are attending in person in the room and remotely by using the Zoom application.
Regarding the speaking list, the committee clerk and I will do the best we can to maintain a consolidated order of speaking for all members, whether they're participating virtually or here in person.
I'd like to take this opportunity to remind all participants of this meeting that taking screenshots or photos of your screen is not permitted.
Given the ongoing pandemic situation and in light of the recommendations from public health authorities, as well as the directive of the Board of Internal Economy on October 19, 2021, and to remain healthy and safe, the following are recommended for all those attending the meeting in person.
Anyone with symptoms should participate by Zoom and not attend the meeting in person. Everyone must maintain two-metre physical distancing whether seated or standing. Everyone must wear a non-medical mask when circulating in the room. It is recommended in the strongest possible terms that members wear their mask at all times, including when seated. Non-medical masks, which provide better clarity over cloth masks, are available in the room.
Everyone present must maintain proper hand hygiene using the hand sanitizer at the room entrance. Committee rooms are cleaned before and after each meeting, but to help us maintain this, we encourage everybody to clean the surfaces such as their desks, their chair and their microphone with the provided disinfectant wipes when vacating or taking a seat.
As the chair, I will be enforcing these measures for the duration of the meeting. I thank members in advance for their co-operation.
I thank those who have come today for dealing with the brief technical issues we have had. I appreciate your bearing with us. It's nice to have everybody here officially. That's why it's helpful if people can show up at least five or 10 minutes early so we can do that and start on time.
With that said, I would like to welcome the Minister of Public Services and Procurement and her colleagues. I would invite the minister to make her opening statement.
Go ahead, please.
Good afternoon, committee members, and thanks for inviting me to appear before you today.
Let me begin by acknowledging that I'm participating from my home town of Hamilton, which is located on the traditional territory of the Haudenosaunee and Anishinabe peoples.
With me from PSPC are my deputy minister Paul Thompson and associate deputy minister Arianne Reza, as well as other department officials.
From SSC, there is president Sony Perron and assistant deputy minister and chief financial officer Samantha Hazen, as well as other department officials.
I am pleased to be here for the first time as Minister of Public Services and Procurement and Minister responsible for Shared Services Canada to discuss my mandate letter as well as the fiscal year's main estimates and departmental plans for both PSPC and SSC.
I also want to take a moment to thank the committee and its members for being so accommodating and agreeing to reschedule my appearance after my medical issue that forced me to cancel the previously scheduled meeting. You have also offered your get-well wishes to me through my parliamentary secretary, and I'm deeply grateful for that.
Mr. Chair, PSPC has a wide-ranging mandate and touches on many aspects of daily and long-term government operations. As a common service provider, the department works to support the whole of government as it serves Canadians, from procurement to managing government buildings to being the pay and pension administrator for the public service and more.
Similarly, SSC delivers a wide array of IT services to government organizations so that they in turn are positioned to deliver digital programs and services that meet the needs of Canadians.
The array of commitments I have been asked to deliver on are complex, multi-year and often multi-mandate endeavours. Many of these priorities build on work led by my predecessors, and I'm honoured to continue delivering these important commitments for the benefit of all Canadians.
Let me begin by speaking about the important role that PSPC continues to play to support Canada's ongoing response to the pandemic.
While our aggressive procurement approach has resulted in a secure supply of vaccines and PPE, there is still more to do. Rapid tests and therapeutics are in high demand across the globe, and we are working to ensure we have enough supply of those commodities. We will continue working closely with our public health counterparts to secure whatever is needed as we make our way to the other side of this pandemic.
To date, Canada has procured and received 604 million rapid antigen tests, 598 million of which have been distributed to provinces and territories. We have contracts for nine different therapeutic treatments, giving us access to 1.7 million treatment courses.
Canada has contracts in place with the world's leading vaccine suppliers for all vaccines currently approved by Health Canada, as well as access to supplies of future formulations that will protect us against variants. Today the announced the next steps in assuring that Canada has a secure domestic supply of the latest vaccines through an agreement with Moderna to set up a manufacturing facility in the Montreal region. Tens of millions of N95 respirators are being produced in Canada every month, thanks to our long-term contracts with Medicom and 3M.
In short, Mr. Chair, PSPC and our whole team continue to deliver for Canada and Canadians as we work to finish the fight against COVID-19.
At the same time, another crisis has emerged on the world stage, requiring a global response. We have all witnessed the horrors unfolding in Ukraine following Russia's unprovoked and unjustified attack on that sovereign nation.
Now more than at any time since the Second World War, it is essential for all democratic nations to stand united and unfaltering in our support of Ukrainian sovereignty. We are working with our partners in government and abroad to facilitate and provide the necessary logistics in order to support the Government of Ukraine as well as the people of Ukraine, both for those who are staying to fight and for those who are fleeing the horrific violence.
Additionally, when it comes to protecting Canadians, our government is dedicated to ensuring that the Canadian Armed Forces have what they need to deliver on commitments at home and abroad. We continue with ongoing delivery of defence procurements. That includes the purchase of new fighter jets for the Royal Canadian Air Force. Following a rigorous evaluation of the proposals, the government has entered into the finalization phase of the process with the United States and Lockheed Martin. We are on track to reach an agreement later this year with delivery of the aircraft as early as 2025.
We also continue to work with our partners to renew the fleets of the Canadian Coast Guard and the Royal Canadian Navy. Shipbuilding involves a complex and challenging process and work, and we always seek to make improvements so that we can meet the objectives of the national shipbuilding strategy.
Procurement is an important part of my mandate. It's also a powerful lever that we will be using to drive just and inclusive economic prosperity. I’m very happy to say that we are making progress in this regard. For example, as we continue to walk the path of reconciliation, we are leading the implementation of a requirement to ensure that a minimum of 5% of the value of federal contracts is held by businesses led by indigenous peoples—first nations, Inuit and Métis.
More broadly, my department has launched a supplier diversity action plan that includes pilot projects to increase the participation of under-represented groups in federal procurement. For example, our Black business procurement pilot project led to the government awarding a series of contracts, and we received important feedback from the community about the process. Pilot projects such as this one are guiding changes to policies and processes that will help remove barriers to full participation in procurement for all suppliers.
Mr. Chair, in addition to levelling the playing field for under-represented businesses, we are doing our part to tackle forced labour. This is a concerning reality internationally, and we will support the in introducing and implementing legislation that keeps our supply chains free of human rights abuses. In the meantime, we have introduced clauses in our contracts that place the onus on suppliers to keep their supply chains free of forced labour. Those that fail to do so will have their contracts terminated.
The department has other important work under way, including the renovation and rehabilitation of the parliamentary precinct. This is highly complex, multi-decade work that will continue to honour our history while ensuring that these iconic buildings meet the needs of a 21st century Parliament.
My department also continues to support environmental sustainability in government operations. As an example, with our energy services acquisition program we are modernizing the district energy system that heats and cools 80 buildings in the national capital region. We have already cut greenhouse gas emissions by 57% from the baseline year of 2005, and we are on track to meet our goal of being net zero by 2030.
Mr. Chair, public servants have worked tirelessly to support these and so many other government efforts. Like all workers, they deserve to be paid accurately and on time. This remains a top priority, and we continue our efforts to resolve the backlog of pay transactions and stabilize pay operations. Concurrently, Shared Services Canada is advancing work on the next-generation human resources and pay solution, one that is flexible, modern and integrated.
Like PSPC, Shared Services Canada plays a vital role in supporting government operations. Of note, SSC is working on several fronts to provide public servants with modern tools and updated government IT systems and to deliver digital services to Canadians that are secure, reliable and easy to use at any time from any device. I would also note that throughout the pandemic, SSC has adapted to new realities—for example, by launching new online collaboration tools for public servants working from home.
Similar to PSPC, SSC will continue to advance government-wide initiatives to increase the diversity of bidders so that more companies have access to government IT contract opportunities.
Mr. Chair, I have touched upon just a fraction of the important work of PSPC and SSC as outlined in each departmental plan and in my mandate letter. To deliver on our mandate and help PSPC continue to deliver on these priorities this fiscal year, we are requesting just over $4.6 billion in the 2022-23 main estimates. As for SSC, we are requesting that the department’s reference levels increase by $710.8 million to $2.6 billion.
I'm happy to take your questions regarding the main estimates, departmental plans and my mandate letter.
Thank you, Mr. Chair.
That's an excellent question, MP Johns, and I'm happy to have the opportunity to speak about it.
Look, this polling...and you're absolutely right about my mandate letter. I totally understand that. We want to ensure that we work with Canada Post to get them to a place where they are self-sustaining. That's the goal.
We recognize how important Canadians believe Canada Post is in terms of the services they provide. I've had stories about medicines during COVID that needed to be delivered, and the Canada Post workers continued to make those deliveries, so there's great gratitude to Canada Post and their workers.
With respect to the survey specifically, let me say this. It's critical for us to understand where Canadians are with respect to their relationship with Canada Post. We know that COVID-19 has changed many things, and it's critical as we move forward, as we make decisions and work with Canada Post, that those decisions are based on an understanding of what Canadians' views are with respect to their relationship with Canada Post. That information is information that is important.
I've had meetings with Canada Post as well as CUPW, and if you have any information that you want to share with me, please provide it, because the government wants to be armed with all that information so that we can make the right decisions with respect to guidance with Canada Post and working with them.
Okay, Minister; I appreciate it.
There were promises made in 2015 to restore mail service delivery that haven't happened. I want to talk about the future.
I want to talk about the record profits of the big banks in this country. Communities across this country have seen branches being closed by those same banks that have had record profits, especially in rural and remote communities.
Many indigenous communities are underserved, leaving residents without access to financial services or relying on predatory payday lenders or businesses that gouge them when they want to cash their cheques. Most indigenous communities, as you know, have no access to a bank branch, especially in Nunavut, where it's a huge issue. This contributes to systemic inequities.
Postal banking could help Canadians access more affordable, quality banking services where none are currently available. Your pilot tests have been very positive. The Canadian postal workers union supports postal banking, and the revenue generated could help support Canada Post's other services.
Will you work with Canada Post, and us, to begin developing postal banking for Canada, as they've done in Australia? It actually shows profit there.
There are a few things we are doing with the shipyards. We do these things on a very continuous basis through the governance that we have established with those shipyards, through the umbrella agreements, and through our contracts that we manage with them.
One of the key ones I would like to highlight is the earned value management discipline, the EVM, that we have instilled within the national shipbuilding strategy enterprise, not only with the Vancouver shipyard but also with other shipyards. This earned value management discipline enables us to tie together some key data from a scope, schedule, and cost point of view and monitor in real time the progress of our projects. We do this for every project and implementation. We also want to do this for all upcoming projects, eventually improve our tools and apply it across the entire NSS, the national shipbuilding strategy.
We are looking at specific data from workforce management at the Vancouver shipyard. As highlighted by our minister, labour in our shipyards right now, with COVID's impact, is difficult to manage. We're trying to have a very granular look at what's going on from the workforce point of view within the shipyards and how it impacts each one of our projects.
I will also mention that we keep an eye on very high-level measures and metrics with, for instance, the joint support ships. We look at the number of blocks assembled. We look at specific gates, engine loadouts, the number of pipes that are assembled, the cables that are pulled and things like that. On top of the EVM, it gives us a full, comprehensive appreciation of where the project stands.
I thank the member for his question.
I would like to add some clarification to the minister's answer by using the example that was mentioned—the Canadian warships.
Yes, we are doing very specific things to contain costs and to stay within the current budget envelopes. We have meetings with the shipyards and with the Royal Canadian Navy to review the situation, because a lot of these costs stem from needs that we must understand. We also have to look at the state of inflation. We must also understand the technology and how often it needs to be updated. There are a lot of things to consider. I can confirm that we have meetings to review these issues.
For example, we are currently holding meetings to refine the design of the models. It is also important to understand that these are unique and first-class models, and we have all learned new lessons from this exercise.
So it's not easy to put into one budget envelope what the costs are going to be, what the timelines are going to be, and what's going to be the most cost-effective for Canada, but we're trying to do that.
Let me add that we are currently in direct discussions with our British and Australian colleagues. They're doing the same project as we are in terms of the hull, but it's very different in terms of the combat systems. We have representatives who visit them and we consult with them. We try to learn as much as possible from their experiences.
Thanks, MP Thompson, and thanks for your work.
This is absolutely a whole-of-government approach. We came together because we recognized that the most important thing was the health and safety of Canadians, and this took an effort whereby partners were brought together across this country in order to provide everything that was needed to keep Canadians safe.
When we think of where we've come, we see that when COVID-19 descended upon us, we didn't even have an approved vaccine. Now we are in a...position. We entered into agreements with seven vaccine suppliers, and to this day we have a sufficient supply of vaccines for every Canadian to get their full complement of what they are eligible for. I thank my predecessor; I can't take credit for this. We know that vaccination is the best way to protect Canadians during COVID.
That's one piece I would say.
The second part is we have to thank businesses. We know that local businesses pivoted and tried to respond to the needs that were there. They retooled and invested and took risks in order to do that. We wanted to invest in as much domestic supply and capacity as we possibly could. We spent 42% of the money on domestic supply. There were times when we had to reach out because we needed to get the life-saving PPE here, and we weren't going to risk the health and safety of Canadians, so we did that.
When I look at where we're at now, we have contracts with Medicom, for example, which responded to Canada's call to action early to produce 20 million N95 respirators and 24 million surgical masks per year for the next 10 years. They are up and running in Montreal.
We look at the announcement the made today with respect to working with Moderna, which is looking here to provide a vaccine supply.
I will give credit. It was a whole-of-government approach. I think everyone realized that we needed to come together and put the health and safety of Canadians first, and I think we did that.
Yes, I know that, Mr. Chair.
I'm going to ask my questions quickly, but I would like to get answers in writing.
At the beginning of the pandemic, respirators were purchased at 181% of the normal price. A contract for $237 million was awarded to FTI Professional Grade. How much of that contract was ultimately paid out? Of the 10,000 respirators ordered, how many have been received and how many are sitting in government sheds?
On information technology, Shared Services Canada is asking for $2.6 billion. What are the reasons for this 37% increase over last year?
What amounts are going to Cisco or a company that sells Cisco products?
What are the government's intentions regarding the awarding of contracts to IBM for the possible implementation of a digital passport?
Time and time again over the past two years, the outdated computer systems have been cited as the reason for the delays at the Canada Revenue Agency and at Immigration, Refugees and Citizenship Canada, among others. It also explained, in part, why files could not be checked to see if a person was committing fraud or was a victim of fraud.
How soon do you expect the systems to be fully functional and no longer considered outdated? Finally, what are the plans to avoid further obsolescence of the systems in the future?
I would like to get answers in writing. There are six or seven questions, I know it is a lot, but I am aware of the time. As I only had two minutes, you would not have had time to answer even one of my questions.
I thank you again for taking the time to be with us during the two-hour session of the committee. I am very grateful to you.
I wish you all a great weekend.
I understand, Mr. Zielonka. This funding goes to the Department of National Defence, but for procurement contracts, and it is Public Services and Procurement Canada that must award the contracts. These are amounts of money that do not exist anywhere, but that are budgeted.
We will leave it alone. I think the government should find a smart answer for this famous $15 billion, which, by the way, was found by the parliamentary budget officer.
Minister, I have a question for you about Canada Post.
Last January, Radio-Canada reported that the aboriginal reserves had different postal codes. I am currently in Quebec City, two kilometres away from the Wendake reserve. Right now, in Wendake, if you send a package, you have to pay 30% more than elsewhere. This makes no sense. We are talking about the Wendake reserve, which is located in the centre of Quebec City. Since the reserve's postal code is different, it is considered a remote area. The same problem exists throughout Canada.
I imagine that you are already aware of this situation, since it was in the news in January. Have any measures been put in place? When we talk about support for aboriginal people, it seems to me that this is one of the problems that should be very simple to solve.