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Results: 1 - 34 of 34
View Mathieu Ravignat Profile
NDP (QC)
View Mathieu Ravignat Profile
2015-03-12 11:37
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Thank you, Mr. Chair.
This meeting has significantly changed. We were supposed to have here the new commissioner, who is nominated for a six-month period. It is fundamental to our democracy that commissioners appear in front of committees when they're nominated. This last minute decision not to appear is a contempt for the importance of our parliamentary institutions.
I also noticed that the Privacy Commissioner has not been allowed to appear in front of the committee on Bill C-51. This is a habit that the Conservatives are getting into, of muzzling commissioners. It is fundamental to ensure, when we make nominations of this importance to Canada and to Canadians, that we have a chance as parliamentarians to question the competencies and the quality of the nominee. I think it's unconscionable, Mr. Chair, that the commissioner is not here today.
What happened? I need to know what happened, first of all. This meeting has been cut in half, and something fundamental to the health of our democracy has been tampered with. I expect some kind of justification. The commissioner just cannot decide, “I'm going to wake up this morning, and Parliament doesn't matter.” He or she, depending on the commissioner, has a responsibility to come here when called upon and to be questioned.
I think this is a serious matter that we need to give full consideration to before we hear from our other invitees today.
Thank you, Mr. Chair.
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 11:31
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Thank you very much, Mr. Chair,
and members of the committee.
Good morning. I welcome this opportunity to present and discuss with the committee the measures that Public Works and Government Services Canada has put in place to uphold the public's trust in procurement and real property transactions—
The Chair: There is a fire alarm. We will suspend the meeting.
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 11:53
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Thank you, Mr. Chair.
Good morning, again. It's still morning.
We are here to present and discuss with the committee the measures that Public Works and Government Services Canada has put in place to uphold the public's trust in procurement and real property transactions.
With me today is Barbara Glover, the assistant deputy minister from the departmental oversight branch. Barbara's branch encompasses the sectors that we call operational integrity, special investigations, forensic accounting, and industrial security. It also includes our office of internal disclosure, under the PSDPA.
Pierre-Marc Mongeau has appeared before you many times. He is here with me today as the assistant deputy minister, real property.
Pablo Sobrino is the associate assistant deputy minister, acquisitions. He was before you recently with regard to the integrated relocation program. Those are the colleagues with me today.
As deputy minister, I am proud of the key role my department plays as a common service provider so the departments and agencies can obtain the goods, services and accommodations they need to serve Canadians. The department is also the primary interface between government and business on a wide range of business activities.
Over the past three years, we have overseen an average of 49,000 procurements a year with an average value of $14 billion; we house some 270,000 public servants in more than 1,800 locations across the country, involving about 500 real property transactions per year.
As you can well imagine, the procurement processes by which we make these acquisitions and transactions can vary from the immensely complex, involving significant dollar values and sophisticated equipment and services, as is often the case with military procurements, to those of lower dollar value or greater volume and more recurrent requirements, such as supply arrangements and standing offers for a wide range of goods and services.
Given our roles and responsibilities, Public Works and Government Services Canada has a strong history of working to protect the public interest from those with criminal or corrupt motives. My department has a framework in place that supports accountability and integrity in procurement, with strong governance, codes of conduct, fairness monitoring, audits, financial controls, and internal investigations. These mechanisms apply to all those involved in our procurement activities.
I understand the committee has expressed interest in the fairness monitoring program and our integrity framework.
So I will start with the fairness monitoring program, which is a component of our integrity measures. The program was formally instituted in 2005 and expanded in 2009 to provide management, client departments, suppliers, Parliament and Canadians with independent, third-party assurance that our large or complex procurement activities are conducted in a fair, open and transparent manner. The program covers all complex or major departmental procurement and real property transactions. The findings are publicly released on our website.
Our policy on fairness monitoring requires a mandatory assessment for coverage with regard to activities in which risk related to sensitivity, materiality, or complexity is such that fairness monitoring coverage is warranted, as well as for all departmental activities subject to ministerial or Treasury Board approval.
Other departmental activities, for which an enhanced assurance of fairness, openness, and transparency is desired, can also be covered for fairness monitoring, whether mandatory or optional. The assistant deputy minister for oversight reviews these assessments and makes her recommendations to me on whether or not to proceed with fairness monitoring.
The most recent improvement to the program is a new standing offer for the services of fairness monitors, which will be issued shortly with a start date of June 10, 2013. This includes formal terms of reference for fairness monitoring engagements. I believe the committee had asked for the statement of work for the procurement of those services, which I understand we have provided.
The terms of reference will ensure alignment between fairness monitors and the department on the standard of fairness to be used, and the standard of conduct for fairness monitors to follow during fairness monitoring engagements.
I will now turn to our overall integrity framework.
All PWGSC employees must adhere to the department's code of conduct that includes specific provisions for the proper management of procurement activities through compliance with all available practices, controls and policies; and to prevent situations of real, potential or apparent conflict of interest. Employees must disclose when considering or engaging in outside employment and/or ownership of businesses, and comply with guidelines related to gifts, hospitality and other benefits.
Over and above this general code, the department implemented in 2007 and then updated in 2012 a code of conduct for procurement that applies to suppliers and to departmental staff and that outlines what is acceptable conduct when contracting with the government. Our goal is to ensure that the department conducts its business to the highest ethical standards, standards that Canadian citizens expect us to uphold and protect. It is a role that we take very seriously. And we have implemented significant compliance measures.
Let me give you an overview of these significant compliance measures.
Starting in 2007, as part of the Federal Accountability Act and its action plan, Public Works and Government Services Canada included a code of conduct for procurement in its solicitation documents, which included “payment of a contingency fee to a person to whom the Lobbying Act applies” to existing offences, which rendered convicted suppliers ineligible to bid on procurement contracts. The code also included frauds against the government under the Criminal Code and under the Financial Administration Act. Bidders formally certified with their bids that they had read the code and agree to be bound by its terms.
Building on these measures, in 2010 the department added anti-competitive convictions under the Competition Act to its list of offences that render bidders ineligible. These convictions include corruption, collusion, bid-rigging, or any other anti-competitive activity.
In July 2012, the department further expanded the list of offences that, if convicted, would render companies ineligible to do business with PWGSC. These offences include money laundering, participation in activities of criminal organizations, income and excise tax evasion, bribing a foreign public official, and drug trafficking.
For the first time, PWGSC also applied its integrity provisions to all real property transactions, which includes leasing arrangements for all uses, letting of commercial crown-owned space and the acquisition and disposal of crown-owned properties.
In November 2012 the department further clarified its integrity measures by removing the leniency exemption and introducing a public interest exemption. Leniency provisions allow an applicant to come forward, cooperate, and plead guilty in exchange for lenient treatment in sentencing. Given the seriousness of the infractions identified in the integrity provisions, the department no longer does business with individuals and companies found guilty of these offences unless exceptional circumstances require it for the public interest. This applies even when leniency may have been granted to the company through a program.
Under these provisions, the department can no longer enter into a contract or real property transaction or accept bids from individuals, companies, and the current members of their board of directors, including company affiliates, convicted of listed offences. These measures do not apply to company employees.
Should a company or a member of its board of directors obtain a record suspension—it used to be a pardon—or have its capacities restored by the Governor in Council, they would become eligible to do business with Public Works and Government Services Canada. In instances of public interest such as health and safety, emergencies, national security, or if there is only one supplier, the department could maintain the contract.
Successful bidders are required to maintain relevant information and their certification for the duration of the contract. Bidders and their officers must remain free and clear of convictions specified in the code of conduct, which is incorporated into their contract.
If a company is convicted of an offence after a contract has been awarded, the department may cancel the contract for default if the terms and conditions of the contract include our enhanced integrity provisions.
However, these provisions are not retroactive. So in cases where the provisions are not in the contract, the department is legally obligated to honour the contract. In such instances, heightened scrutiny and oversight and rigorous controls may be imposed for the remainder of the contract to protect taxpayers' interests.
Should we suspect wrongdoing, the department will not hesitate to take action, including procurement and administrative reviews to detect any irregularities; examining all invoices to ensure their accuracy; requesting the voluntary inclusion of the department's integrity measures in contracts; audits; and formal or departmental investigations.
If the department suspects wrongdoing, we will not hesitate to take the necessary measures, including requesting formal investigations by the RCMP or the Competition Bureau.
These measures apply only to Public Works and Government Services-managed procurements and real property transactions. The department manages approximately 83% of the value of all government-wide procurement. Departments and agencies have a delegated authority to contract for goods up to $25,000. Some departments have exclusive authority for goods contracting. Departments and agencies may contract for services under their own delegated authorities. However, a number of organizations that have such delegations or authorities, such as the Canada Revenue Agency, have entered into a memorandum of understanding with our department so as to be able to benefit from our integrity provisions.
The department has put in place numerous measures that demonstrate its commitment to doing business with companies and individuals that respect the law and act with integrity. The department will continue to build upon these measures. That is our responsibility as stewards of public funds.
We continue to enhance our approaches and measures. For example, last month we entered into a memorandum of understanding with the Competition Bureau of Canada to promote cooperation between our two organizations on the prevention, detection, reporting, and investigation of possible bid-rigging or cartel activity. Our minister has also asked us to explore improvements to the framework and to see how it could be applied more broadly across government.
Mr. Chair, this concludes my remarks.
Thank you for the opportunity to present our integrity measures and fairness monitoring program.
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Barbara Glover
View Barbara Glover Profile
Barbara Glover
2013-06-04 12:10
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Sure.
The fairness monitoring program was formally put in place in 2005. As Michelle mentioned in her introductory remarks, we have recently updated the standing offer. The way we seek fairness monitors is through a standing offer. That process is complete. We seek folks from outside the department who are independent and who have various credentials, which are laid out in the statement of work that we provided you earlier. We ask these people to come in, observe the procurement process from beginning to end, essentially, prior to setting out a request for proposal.
They engage in real time with the folks in charge of the procurement. They are asked to observe every aspect, to read all of the documents related to a procurement, to make observations, again in real time, and then to prepare a final report, which is posted.
At the beginning of engagement they need to attest to their independence, i.e., have no possible conflict of interest in undertaking their work. They are engaged by my branch, which is to say not the folks undertaking the transaction, whether it's a real property or procurement transaction.
Is that...?
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View Ron Cannan Profile
CPC (BC)
Excellent.
In your preamble you shared a little bit about your successes. Maybe you could expand a little bit more on how the integrity process is unfolding to other agencies and departments within the government.
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:16
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As I indicated in my remarks, we cover almost 83% of procurement across government, but departments do have their own authorities and some organizations do not or are not required to use Public Works and our procurement services.
We have in a number of instances developed a memorandum of understanding and a number of organizations have signed those with us, so they will voluntarily apply our integrity provisions. They come to us when they are about to issue a contract to make sure that the companies with which they are contracting are indeed who they should be contracting with.
We are working with our colleagues at the Treasury Board of Canada Secretariat to see how we could more broadly apply the measures across the government. The procurement policy instruments really rest with the secretariat.
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View Denis Blanchette Profile
NDP (QC)
View Denis Blanchette Profile
2013-06-04 12:18
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Thank you, Mr. Chair.
My thanks to our guests for joining us.
I would like to go back to the way in which the fairness monitors work. Given that these can be very expensive contracts in very specialized areas, I would like to know how you are choosing these monitors.
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:19
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Mr. Chair, they have to have both expertise and experience. They have to be able to follow the procurement activities. I will ask Ms. Glover to provide more detail about the way in which fairness monitors are chosen. Once they are on a list, essentially a list of standing offers, there is a rotation.
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Barbara Glover
View Barbara Glover Profile
Barbara Glover
2013-06-04 12:20
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Just to add, it's part of the statement of work, which you all have. It states what the fairness monitoring team must have to be eligible. They must have a range of knowledge, disciplines, and skills to carry out the engagement. That means they can acquire a specialist on a specific transaction.
For example, for a complex real property transaction they may wish to bolster their team with a subject matter expert, and that's laid out. There's a provision for that.
They themselves—
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View Bernard Trottier Profile
CPC (ON)
Thank you, Mr. Chair.
Thank you for your presentation, Madame d'Auray.
It was very helpful to see the improvements that have been made over time, and it's fair to say, especially since the Federal Accountability Act. You talked about the increased transparency with respect to lobbying, which is important, and also toughening up the Criminal Code, and some of those provisions around things that would exclude suppliers. You also spoke about beefing up the Competition Act recently, and then also in 2012, some tougher rules for procurement.
It is my observation that the federal procurement rules are tougher than any other level of government in this country. Certainly, with respect to municipal procurement, we see time and time again some problems there. I'd say the federal rules are probably tougher than any provincial rules. It's a lot of procurement, $14 billion, as you say, and about 49,000 procurements a year.
I want to ask some questions about some further levels of detail on how that's enforced. When Public Works and Government Services Canada excludes a company that's convicted of an offence, are those companies ever back on the list, or is that forever?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:26
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Thank you, Mr. Chair.
That is an interesting question and one that has been posed to us. Right now, it is forever. One of the questions some of the associations have asked us is whether there could be a time-limited debarment. I think that is one of the elements we are also considering.
You mentioned provinces, territories, and other jurisdictions. We've also looked around the world to see what the measures are and what is being applied. Some countries and some jurisdictions have time limitations. Some have them forever. Some have processes to become re-enabled, if I can put it this way, beyond what we have here as a pardon or a record suspension.
We are looking at what other jurisdictions are doing around the world in this area. As one of the members pointed out, the OECD has made a number of recommendations in this area, and I would say most jurisdictions are grappling with some of these issues. So how best to address them and to continue to enhance our framework or to improve the framework is one of the areas where we're continuing to spend time and effort.
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Barbara Glover
View Barbara Glover Profile
Barbara Glover
2013-06-04 12:28
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Companies reorganize. That's a fact. We try to look carefully when there is a conviction at who the affiliates are. We use a control test and we try to apply it quite rigorously. It's not always transparent. When we talk about a public company, it's fairly easy to do. When we talk about private companies, it gets more challenging. In fact, we use our forensic accountants in my shop as well as consult with our legal services colleagues to examine the transactions, and really, whether it's bona fide, which is to say whether the affiliate is still an affiliate or not.
In terms of company directors, there can be a test of how the control is exercised. As an example, a company director could move to another company but they may still be exercising control over an affiliate.
I don't know if that answers your question.
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View Bernard Trottier Profile
CPC (ON)
Yes, that's helpful.
Does PWGSC reward companies that do compete in a fair and transparent manner by creating a register of authorized suppliers?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:29
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No, we don't create a register of companies good, bad, or indifferent. The closest thing we come to a register, if I can put it this way, is when we have standing offers or supply arrangements where pre-qualified firms are listed for a specific procurement. That is another question that other jurisdictions have grappled with—creating lists versus not creating lists. As we're finding in jurisdictions, as soon as you create a list, put a name on a list, it becomes dated and you have to start all over again.
We prefer currently what I would consider to be our dynamic model, which is that every time a contract is up, we actually check every time there's a contract amendment. There's a process where we validate. It is a constant updating of our own information, as opposed to having a list that can be pretty static or stale-dated fairly quickly.
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View John McCallum Profile
Lib. (ON)
Thank you.
Let's suppose that one or more executives of a company are convicted of a crime, so that bans the company from doing business. But those bad people, as it were, subsequently leave the company or are fired, would the company be reinstated or would it continue to be banned?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:31
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With regard to executives of a company, unless they have a controlling interest in the company, it does not apply to employees of a company. It applies to the company as an entity or to its board of directors with a controlling interest.
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Barbara Glover
View Barbara Glover Profile
Barbara Glover
2013-06-04 12:33
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There are two possibilities. The officer is fired or leaves or quits, and the company still has a culture of a lack of integrity. In that case, we have a range of measures. Under our measures, we would still do business with that firm but there's a fairly long list of things we could do to monitor contracting invoices, to raise the level of delegation of who is signing off on contracts or invoices. We could talk to the company and specifically make requests of them around improving, say, the values and ethics of the company, and we have done that.
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View John McCallum Profile
Lib. (ON)
Thank you.
Who makes the decision whether the public interest exemption will be granted or not?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:34
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It is on a case-by-case basis. It is in fact.... I believe there's an integrity committee that my colleague, Barbara Glover, chairs.
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View John McCallum Profile
Lib. (ON)
Finally, on the fairness monitors, I gather that the program was established in 2005, but I believe similar things happened before then. What was the change? How did things change in 2005?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:35
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The reason this was established as a program per se and given to the sector that Ms. Glover heads is that the fairness monitoring was done on an ad hoc basis and the contracts were issued by the branches that were actually undertaking the activity. We wanted to strengthen and separate the functions from the actual procuring or leasing or contracting sectors in order to be able to create an additional level of independence.
The program was established as a program as opposed to an ad hoc series. There was a structure put around it—criteria, processes, publication of the report. It was really structured as a separate stand-alone program and was done with our colleagues in the integrity branch.
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View Jacques Gourde Profile
CPC (QC)
Thank you, Mr. Chair.
My thanks to the witnesses for joining us this morning.
When big companies, those employing between 1,000 and 2,000 employees, provide services to the Government of Canada and are tainted by allegations or charges or are found guilty because of the actions of one, two, three or four individuals, do they run the unfortunate risk of losing all their contracts?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:37
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The measures we have come into play when the offences are committed or businesses or the heads of businesses are convicted. The measures do not affect the employees as such.
But, as my colleague indicated, if the employees of a company are found guilty of various offences, we can and do increase our vigilance towards the activities of those companies even if the company is not prohibited from doing business with the Government of Canada, or at least with Public Works and Government Services Canada.
We take additional measures in terms of monitoring and auditing. We have also, on several occasions, asked companies to adopt our codes voluntarily and to take the steps that we recommend.
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View Pat Martin Profile
NDP (MB)
View Pat Martin Profile
2013-06-04 12:43
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Perfect. That's exactly what I wanted to know.
Next, is SNC-Lavalin on any qualified bidders list for procurement contracting with the Government of Canada?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-06-04 12:44
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Yes, Mr. Chair.
We have a number of contracts with SNC-Lavalin. We have a number of major contracts, primarily in what we call the operation and maintenance of our federal properties. There are a number of other contracts that Public Works has issued on behalf of other departments.
So yes, there is a range of contracts with SNC-Lavalin.
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-04-30 11:09
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Thank you, Mr. Chair.
Good morning. It is a pleasure to appear before this committee for the first time since my appointment as deputy minister of Public Works and Government Services Canada, which was not quite six months ago.
I have my briefing book with me and I will now introduce my officials who are with me at the table today. They are people who are familiar to you: Alex Lakroni, who is the chief financial officer and assistant deputy minister; John McBain, who, as of yesterday, was appointed special adviser to the deputy minister.
Just a word on that change, Mr. McBain was, until last Friday, assistant deputy minister, real property, but as a transition to his eventual retirement, I was able to convince him to continue to provide me with his expertise and experience for a little while yet. He looks great. I'm grateful to him to have agreed to this assignment and for his appearance before you today.
His successor, whom you also know, Pierre-Marc Mongeau, is also here today, sitting behind us, to address any questions on the parliamentary precinct projects and plans. He is being replaced by Nancy Chahwan, who is also here.
So we are ready to answer your questions pertaining to our 2013-2014 main estimates and report on plans and priorities.
Although the knowledge I acquired at the Treasury Board Secretariat will stand me in good stead in my new role, I understand that taking the reigns of Public Works and Government Services Canada is quite a responsibility. This role is very dear to me, both for its important capacity as service provider and for its government-wide responsibilities.
I believe that centralized service delivery agencies enable the government to benefit from significant improvements in terms of productivity, efficiency and economies of scale. These agencies also help the government standardize a number of administrative functions to best leverage the private sector by providing practical common solutions. By releasing departments from having to perform daily activities, these agencies enable them to focus on their mandates and priorities.
PWGSC plays a key role in the operations of the federal government. As its treasurer, accountant, central purchasing agent, linguistic authority, and real property manager, the department is home to the Receiver General, prepares the annual public accounts of Canada, and manages a cash flow of more than $2 trillion a year in support of that role. It accommodates more than 270,000 federal employees in a diverse real estate portfolio that comprises almost 1,800 locations across Canada. It manages and oversees the lion's share of government procurement, which contributes more than $14 billion annually to the Canadian economy, translates more than one million pages of text on behalf of federal organizations, and provides translation and interpretation services for Parliament.
For the 2013-14 main estimates, PWGSC's gross budget is $5.9 billion, broken down as follows. There is $2.4 billion for the rent, fit-up, and utilities of government-wide accommodation; Receiver General and central compensation administration functions such as banking fees, cheques, and envelopes; and translation services to Parliament. There is $1.9 billion related to providing optional services to departments, such as real property project management and translation services, on a cost recovery basis. We need $900 million to deliver our core programs such as central purchasing and banking, public accounts, payroll, and pension services. We need $600 million in capital for Government of Canada buildings and infrastructure.
PWGSC generates $3.3 billion in revenues, or 56% of its budget, from client departments. This results in a net appropriation of $2.6 billion. The 2013-14 main estimates represent an increase of $254 million, or 4.5%, over last year's main estimates. One of the key reasons for this increase over last year's estimates is the amount allocated to the rehabilitation of the Parliament Buildings. Work continues so as to ensure their preservation as heritage assets and national symbols, and as functioning buildings that are essential to the continuity of our national democratic institutions. The total 2012-13 estimates earmarked $247 million for the parliamentary buildings rehabilitation projects. For this fiscal year, the allocation is $261 million—an increase of $14 million as per approved project plans and schedules. The parliamentary precinct's west and east blocks are included in the rehabilitation projects for 2013-14. All major projects, including the major rehabilitation of the West Block and 180 Wellington Street, are still on or ahead of schedule and on or under budget.
Another factor contributing to the increase in our 2013-2014 main estimates is the purchase of the Terrasses de la Chaudière complex in Gatineau. The amount of $50 million would be added to our budget to complete the transaction.
During this period of downsizing, such a purchase might seem odd, but this is not a new space for the government because we already occupy the entire complex: nearly 8,000 government employees work at Terrasses.
As well, the Government of Canada had entered into a long-term lease-purchase agreement during the construction of the complex. We have earned equity through lease payments and improvements carried out over more than three decades.
The purchase also allows us to maintain the 25/75 distribution of office space between the cities of Gatineau and Ottawa.
In addition, this purchase would enable us to exercise the option contracted when the buildings were built and leased and is an excellent investment for the crown and taxpayers.
Another increase is $32 million required for the transformation of the pay administration initiative, support for the implementation of the consolidation of pay services in Miramichi, New Brunswick, and modernization of the government's 40-year-old pay system. This aligns with economic action plan 2013's emphasis on standardizing, consolidating, and transforming the way government does business to improve services and deliver efficiencies to Canadian taxpayers. These additional funding requirements are offset by PWGSC's commitment to realize its share of total government-wide savings initiatives.
This year, PWGSC will realize additional savings of $95 million, of which $67 million is associated with our 2010-11 strategic review and $28 million results from budget 2012 expenditure review savings. These efficiencies and productivity improvements are in support of the Government of Canada's commitment to ensure a return to balanced budgets. Maintaining a sound fiscal position is the most important contribution the government can make to bolster confidence and growth, and Public Works and Government Services Canada is proud to contribute to this effort.
Having set out the highlights of our main estimates, I will turn now to how these would be expended, once supply is provided by Parliament, in support of the priorities set out in our report on plans and priorities for fiscal year 2013-14. The department has one strategic outcome: high-quality, central programs and services that ensure sound stewardship on behalf of Canadians and meet the program needs of federal institutions. Seven programs support that outcome, and both the main estimates and the report on plans and priorities set out the planned allocations for each of these programs.
The department's top three organizational priorities for 2013-14 are delivering efficient and effective services, transforming critical infrastructure, and ensuring sound stewardship and management excellence.
Federal departments and agencies, along with many stakeholders from the private sector, rely on Public Works and Government Services Canada for the delivery of effective and value-added services.
Our priorities therefore include improving and streamlining procurement processes in ail categories of goods and services, implementing the National Shipbuilding Procurement Strategy, completing the government's seven-point plan to replace fighter jets, improving the management of our real property portfolio, consolidating pay services and modernizing the computing platform to reduce costs, providing more standardized services to small agencies to help them reduce operational costs, and reducing the administrative burden for companies in the Industrial Security Program.
All of our service offerings and priority activities focus on improving performance, increasing consistency and efficiency of offer, and reducing costs for departments and agencies.
My second priority, transforming critical infrastructure, encompasses all the work to rehabilitate and preserve the buildings in the parliamentary precinct through the long-term vision and plan; delivering on a substantial program of work for our engineering assets, including something I was not aware of until I arrived at the department, portions of the Alaska Highway, for which we are the custodians; and leading the workplace 2.0 initiative for the government, which includes updating workspaces, and with Shared Services Canada, enabling technologies and work processes that create a more efficient and productive work environment.
Our third priority, ensuring sound stewardship and management excellence, speaks both to our goal to drive efficiencies within our own departmental internal services and to the stewardship role we play in ensuring the integrity of the procurement and contracting processes, which we manage for federal departments and agencies.
Safeguarding the public trust in Public Works and Government Services Canada is a priority for me and for all our employees. The department has been working diligently to protect the integrity of its operations, and more specifically, its procurement processes. Our goal is to ensure that we conduct our business to the highest ethical standards, which Canadian citizens expect us to uphold and protect.
We have a strong framework in place to support accountability and integrity in procurement. This includes a code of conduct, fairness monitoring, audits, internal investigations, policies, procedures, and governance measures. I understand we will have a chance to discuss these in greater detail at an upcoming appearance before this committee as you undertake work in this area,
In closing, Mr. Chair, members of the committee, I have come to appreciate that sound financial management is a hallmark of Public Works and Government Services Canada. We are entrusted with a large mandate, and we manage significant sums of money. We will continue to exercise financial leadership, seek efficiencies, improve service delivery, and identify opportunities for additional savings. I can assure you that our department strives to ensure consistent delivery of high-quality services to Canadians while providing value for money for taxpayers.
Mr. Chair, members of the committee, thank you for your attention. My colleagues and I will be pleased to answer your questions.
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View Linda Duncan Profile
NDP (AB)
Okay. Thanks.
Your report on plans and priorities, which we're grateful to receive simultaneously to the budget, makes our scrutiny much more effective.
In that report, the minister claims to have significantly reduced the average time for major procurements, yet we continue to witness significant delays and botched processes in the outfitting of our military in a mounting list of major procurements: military jets, the integrated soldier system project, the $2 billion close combat vehicle program, and projects to purchase army trucks.
The report on plans and priorities claims the department will make progress on its purported smart procurement by simplifying and streamlining the process, and yet in the procurement for the $300 million integrated soldier system project, apparently you've had to completely repeat it, because that system didn't work.
Can you tell us if the bidders will likely find it necessary to up their prices because of the fact that they've had to prepare that bid twice for this major procurement? As well, do your estimates this year take into account the fact that you're having to redo that procurement process?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2013-04-30 11:33
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With regard to the issue around complex procurements, the ones that are the most challenging often get the most attention. We do quite a few large procurements quite effectively, within a 24-month to 36-month procurement timeframe. We complete them and not a lot of people know about it because they happened and there were no process issues or elements around them.
With regard to a number of the procurements and some of the aspects, as we are learning, when we engage industry very early on in the process it looks like the lead time up front is longer, which it may often be. But it allows us then, when we get into the actual requests for proposals and the evaluation of those proposals...it makes it a lot faster, because the long lead time to get the industry perspective and the views on what the components are, what the capacity elements are, what the criteria are, and also what the evaluation mechanisms are—
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View Linda Duncan Profile
NDP (AB)
Thank you, Mr. Chair. I'd like to follow up on your questions, Mr. Chair.
The report on plans and priorities says that the department will pursue measures to enhance integrity in procurement. Presumably that includes within the department. So in light of the envoy decision, I did note that in addition to imposing the $30 million cost award against the government, the court also recommended a third investigation arising from that by the department.
So I guess the obvious question is.... That, coupled with the issues that CIDA has run across because of SNC-Lavalin, I did put the question to the government yesterday in the House. It does seem peculiar that there seemed to be some integrity rules for CIDA and different ones for Public Works. My understanding is that the new improved integrity guidelines for procurement only require the department to look at convictions by Canadian courts.
Can you clarify that? Particularly since there are now many foreign bidders, including for P3 contracts, is PWGSC also giving consideration to convictions or allegations of corruption that occurred outside of the country?
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Michelle d'Auray
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H.E. Michelle d'Auray
2013-04-30 12:12
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Thank you for the question.
You correctly mention our integrity framework. As I indicated in a response to an earlier question, one of our biggest suppliers in terms of alternate service delivery for operations and maintenance is, in fact, SNC-Lavalin. They have voluntarily integrated our integrity framework into their contracts, even though the contracts are still in place. The interdictions or the debarments are based on convictions, and they are convictions in Canadian courts. We have a mandate to oversee the contracts, which we issue under our legislation. We do offer and provide those contractual services to a number of departments and agencies. So those that procure through us are covered by that integrity framework.
With regard to the foreign-based, that is an element that we are looking at today but it is not currently in place. It is with regard to convictions in Canadian courts.
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View Linda Duncan Profile
NDP (AB)
Thanks. That is of concern, since as we speak there are P3 contracts being considered that could include foreign entities.
My next question is on advertising. Your reports on spending on advertising are issued at an extremely delayed rate. One of the actions that the government, to their credit, took out of the Gomery Commission was to actually become more transparent and open and to issue reports on spending on advertising, and yet we have to wait. Members of Parliament who are responsible for scrutinizing spending had to wait for two years after the spending.
I'm wondering if you are giving consideration to a rapid expeditiousness of those reports in lieu of the fact that contrary to what the government has been reporting in the House, the spending on advertising is rising, and rising for things such as $20-plus million on the War of 1812, which members of the public are saying they're not particularly excited about.
So I'm wondering if you could speak to what measures on openness and accountability in advertising the department is pursuing under your mandate to improve more expeditious reporting on the actual spending on advertising.
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Michelle d'Auray
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H.E. Michelle d'Auray
2013-04-30 12:14
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Thank you.
There are two reports on advertising that are put forward. One is put forward by the Treasury Board Secretariat, which is in relation to the central advertising envelope, and then what Public Works produces are the actual expenditures.
We are conscious of the delays, but we are working with the suppliers, because what we need to post are the actual expenditures and we get that information from our agency of record and the various departments. So we have to make sure that what we produce are, in fact, verifiable numbers.
We are working on accelerating that and working with our suppliers to make sure that we can produce those numbers as expeditiously as possible.
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Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2012-10-25 11:37
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Thank you, Mr. Chair.
Mr. Chair, I am pleased to present my report, which was tabled in the House of Commons last Tuesday.
I am accompanied by Assistant Auditors General Jerome Berthelette and Wendy Loschiuk, as well as by Glenn Wheeler, the principal responsible for the audit of transfer payments to the aerospace sector.
The report contains the results of that audit. In the first chapter, we looked at how Public Works and Government Services Canada, Health Canada, and Human Resources and Skills Development Canada plan their use of professional service contractors. We found that the departments plan their needs for employees and contractors separately. This hampers their ability to assess whether they have the best mix of employees and contractors to meet their objectives.
Departments need to consider the full range of options that will enable them to most effectively deliver programs and services to Canadians.
I'll move now to our report about grant and contribution program reforms. In May 2008 the government announced an action plan to reform the administration of grant and contribution programs and to streamline the administrative and reporting burden on recipients. Our audit looked at whether the government has adequately implemented this action plan. We found that the government has in fact focused its actions where they're most important. Treasury Board Secretariat has provided leadership and guidance to federal organizations to make the necessary changes, and these organizations have acted on most of their obligations. The government has made good progress in implementing the 2008 action plan. Now it needs to determine if the actions taken have made a difference for recipients.
Let's turn now to our audit about what government is doing to help protect Canadian infrastructure against cyber threats. Critical infrastructure includes the power grid, banking and telephone systems, and the government's own information systems. The government has a leadership role to play in ensuring that information about threats is shared, and it has to improve the way it does this. This is important because officials are concerned that cyber threats are evolving faster than the government can keep pace.
In 2001 the government committed to building partnerships with the owners and operators of critical infrastructure systems to share information and provide technical support. We found that 11 years later, those arrangements are not fully operational. Similarly, the Canadian Cyber Incident Response Centre has only been operating eight hours a day, five days a week. It's not the 24/7 information hub it was designed to be in 2005. Furthermore, it's not being kept abreast of cyber security incidents in a timely manner.
Since 2010, the government has made some progress in protecting its own systems and building partnerships to secure Canada's infrastructure. The government must now ensure that the sector networks are in place and working with the Cyber Incident Response Centre.
We are also reporting on how National Defence and Veterans Affairs Canada manage selected programs, benefits, and services to support eligible ill and injured Canadian Forces members and veterans in the transition to civilian life.
There are many support programs, benefits, and services in place to help ill and injured members of the military make the transition to civilian life. However, we found that understanding and accessing these supports is often complex, lengthy, and challenging. The lack of clear information about programs and services, the complexity of eligibility criteria, and the dependence on paper-based systems are some of the difficulties for both clients and departmental staff.
We also found inconsistencies in how individual cases are managed and problem-sharing information between the two departments. As a result, forces members and veterans did not always receive services and benefits in a timely manner or at all.
National Defence and Veterans Affairs recognize they need to work together on solutions. I'm pleased they've accepted our recommendations, including to streamline their processes to make programs more accessible for ill and injured forces members and veterans.
The next report also concerns National Defence—specifically, how the department is managing its real property at 21 main bases across Canada. The Canadian Forces rely on real property such as buildings, airfields and training facilities to carry out missions. These assets are valued at $22 billion. I am concerned that the department is not yet adequately maintaining and renewing its assets.
We found several weaknesses in the department’s management practices. For example, the approval process for construction projects is cumbersome and slow. It takes an average of 6 years to approve projects over $5 million.
We also found that National Defence is behind in its spending targets for maintenance and repair, and recapitalization. As such, weaknesses in National Defence’s management of real property could jeopardize the Canadian Forces’ ability to carry out its missions. National Defence recognizes it needs to improve and change its approach to managing real property.
We also looked at two programs that provide repayable assistance to support industrial research and development in Canada’s aerospace sector. Since 2007, Industry Canada has authorized almost $1.2 billion in assistance to 23 Canadian aerospace companies through the Strategic Aerospace and Defence Initiative and the Bombardier CSeries Program. Industry Canada has done a good job of managing most of the administrative aspects of the two transfer payment programs. However, we found that the department has been slow to measure progress against program objectives and report results publicly. Repayable support to the aerospace sector represents a significant investment on behalf of Canadians. Industry Canada has a responsibility to ensure that funding contributes to meeting the government’s objectives in this area.
Finally, in our audit focusing on long-term fiscal sustainability, we found that Finance Canada analyzes and considers the long-term fiscal impact of the policy measures it recommends. However, at the time of the audit, the government had yet to make public its reports on long-term fiscal sustainability. Analysis that provides a long-term budgetary perspective would help parliamentarians and Canadians better understand the fiscal challenges facing the federal government.
The department has accepted our recommendations. Following the tabling of my report in Parliament, the department issued its first long-term analysis for the federal government. We also recommended that the department publish, from time to time, an analysis for all governments combined—federal, provincial, and territorial—to give a total Canadian perspective.
Mr. Chair, that concludes my opening statement.
We will be happy to answer any questions you may have.
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View Matthew Kellway Profile
NDP (ON)
Thank you.
In your report, one of the concerns expressed is that these budgets have been “treated as a maximum by National Defence”. You expressed concerns about this being a developmental project and yet the absence of risk mitigation to deal with escalating costs.
This brings me to my great curiosity about this report. In the conclusions, and the fact that both National Defence and Public Works disagree with the conclusions of the report, you set out, in my view, a scathing report on the absence of due diligence within those departments.
How are we to reconcile the facts as laid out in this report with the fact that National Defence and Public Works are saying, “It's not our responsibility; it wasn't us”? Where do we go with that? Whose responsibility is it, then?
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