SoVote

Context: House Hansard - 286 - Feb/27/24

Ms. Jennifer O'Connell (Parliamentary Secretary to the Minister of Public Safety, Democratic Institutions and Intergovernmental Affairs (Cybersecurity), Lib.)

Feb/27/24 10:52:31 a.m.
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Mr. Speaker, I would like to begin by taking a moment to state that this government expects all public servants to act in the manner that represents the values and ethics code for the public service, including the obligation to serve public interests under the law. I can also tell members that the CBSA is comprised of dedicated and talented employees who are united in this effort to improve processes and maintain Canadians' confidence and trust as they continue to deliver on their important mandate. I would like to extend my thanks to the Auditor General and the procurement ombud along with their respective teams. They undertook a tremendous project to dig deep into the complex procurement activities as it unfolded for the development of the ArriveCAN app. Their efforts are not wasted, as they are shedding light on an important issue that has a widespread impact across government. Both have pointed to significant gaps and shortcomings in the procurement processes, record keeping, roles and controls at the CBSA. The agency has assured the government that these recommendations, as set out in both reports, will serve as goal posts to addressing the gaps and concerns raised. The CBSA has accepted all the recommendations and has already started implementing action plans in response to the recommendations set out in the reports. These plans reflect the work of the CBSA that it has already undertaken to date and the work it will be doing moving forward to ensure that all of its procurement actions are aligned with policies and processes, that the CBSA continues to operate transparently, that it has stronger regard for the value for money when outsourcing work and that all employees operate in a manner consistent with the CBSA code of conduct and public sector values and ethics. Most notably, the CBSA has so far created the executive procurement review committee to approve contracts and task authorizations. This is providing more oversight on the contracting activities. Second, it will require employees to disclose interactions with potential vendors, which will increase transparency. Third, the CBSA has increased the capacity of its procurement group both to oversee procurement activities and establish a centre of expertise. It will act as a single window to help employees if they have questions or do not understand their authorities and obligations. These examples are just a starting point of the CBSA, which continues to implement the action plans in response to the Auditor General's recommendations. The CBSA recognizes that maintaining the trust of Canadians is paramount and will endeavour to do so by improving its internal management and ensuring that public policies are followed. Canadians deserve to have trust in their institutions and in the public service. The CBSA is working with Public Services and Procurement Canada to improve its procurement practices to ensure strengthened controls, oversight and stewardship over contracting. So far, these discussions have led to its new procurement improvement plan. The agency already started to strengthen its processes and controls related to procurement planning, contract administration, corporate culture and proactive monitoring to reduce the risk of fraud, and more is to be done. The CBSA is responding quickly to move forward in the right direction. One of the steps taken involved launching an internal audit of all contracting at the agency. It has also increased its oversight over the issuing of contracts and task authorizations. The CBSA is also now requiring employees with contracting authority to retake procurement certification courses. Although these are simple steps, they will certainly improve the stewardship of contract administration within the agency, while still providing critical services to Canadians across the country. I would like to use my time to also addressed concerns that have been raised around the value-for-money aspect of ArriveCAN, with the acknowledgement that the gaps in policies and controls existed in the procurement process. We do have to remember that the paper system was slow and costly and was not meeting the information requirements of public health officials. While we cannot disregard the very legitimate concerns raised in the Auditor General and procurement ombud reports over these allegations, there are still some positive aspects of the ArriveCAN app. Last week, the AG appeared before the Standing Committee on Public Accounts and said that she does not think the value should be quantified. She acknowledged that there was some value in digitizing the old paper system at the border. The OAG's 2021 report on border measures covered this as well. I will quote from the AG's appearance last week. I would add that there is also an enduring value to this application, as CBSA has now springboarded off what was done here to automate the border, something they had been working on before the pandemic. They used this as a sort of springboard to go there. There is some sort of enduring value left, post its use during the pandemic. On this side of the aisle, we can agree that things could have unfolded a lot better. I do note that the pandemic context is an incredible management challenge, but this is absolutely no excuse to throw policy and procedure out the window. What we have learned in that regard is unacceptable, and I am glad to see that CBSA is taking that very seriously. Across government, departments were called upon to be fast and flexible in providing services to Canadians, but this bias to action should not have come at the price of sound stewardship. Then, as now, public servants need to remain focused on documenting decisions and taking care of basic management fundamentals. I can report that the CBSA has already made changes to address this, and we will take further action to ensure management practices are aligned with policies and deliver value for money going forward. In order to avoid restrictive requests for proposals, the agency's new executive procurement review committee will look at the mandatory criteria in contracts to ensure that they are not overly restrictive. In addition, contracts above $1 million need to be approved by the CBSA's executive committee to ensure they do not undermine the fairness and openness of the bid solicitation process. The CBSA is reinforcing government spending requirements and has already curbed its use of management consultants. The CBSA will continue to adjust our procurement governance and supporting documents so that they act as a quality control process to ensure mandatory criteria are not overly restrictive and do not undermine the fairness and openness of the bid solicitation process. A culture change in procurement is happening and is necessary. I think that all members can agree that federal procurement is difficult to understand, but we can all understand that it needs to be done properly. Again, we would like to thank the Auditor General and the procurement ombud for their work. These reports, along with the work of various standing committee studies on this matter mean that Canadians can rest assured that procurement in Canada is being examined and the results should be a positive net gain for taxpayers as we think of what kind of work we outsource and how. I have acknowledged that we need to get to the bottom of what happened in this case, and we can also ensure that we tighten procedures to prevent the procurement process from any wrongdoing in the future. I think all parliamentarians should be concerned about the details of this situation. However, after listening to several speeches already in this House today, I do question the sincerity of the Conservative Party, which will say anything to grab power. Their actions do not actually match the tough talk that they often speak in this place. With my remaining time, I would like to demonstrate to Canadians that while we are deeply committed to fixing the procurement process, the tough talk of Conservative members in this place is all talk and not actually based in reality. I think Canadians need to get a picture of how deep this procurement issue goes. In questions, my hon. colleagues have raised the fact that GC Strategies, which is at the heart of this issue, went by a different name previously, or merged from, Coredal Systems Consulting Inc.. With the remainder of my time, I would like to read into the record all of the contracts issued by the previous Conservative government using this very same company that it now claims to be Liberal insiders. They include the following: April 1, 2015, total value over $541,000 for technology consultants; March 3, 2014, over $2.3 million for consultants and a programmer-analyst for Transport Canada while the Leader of the Opposition served as parliamentary secretary; March 26, 2013, over $1.8 million for Transport Canada; November 28, 2012, over $287,000 for management consulting; October 29, 2012, over $968,000 for telecom consultants; October 17, 2012, over $140,000 for other professional services not elsewhere specified; October 17, 2012, over $233,000 for other professional services not elsewhere specified; March 29, 2012, over $213,000 for management consulting; March 1, 2012, $675,000 for information technology consultants; August 9, 2011, over $24,000 for training consultants. It continues: July 29, 2011, over $24,000 for a sole-source contract for IT consultants at the same company that the Conservatives claim does not do any IT work as I am reading out all of the IT contracts that they approved; July 29, 2011, over $24,000 for sole-source contracts for Transport Canada; May 24, 2011, over $129,000 for Public Works and Government Services, for a procurement tool; and October 26, 2010, over $21,000 for management consulting at Fisheries and Oceans. Although this issue is deeply concerning, in regard to what happened here, we can see that the procurement issues are pervasive and it is why this review is absolutely necessary. It is why we committed to doing the work to fix the procurement process to put in better oversight and transparency. However, when Conservatives talk tough, Canadians should know that their actions are very different.

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Mr. Greg McLean (Calgary Centre, CPC)

Feb/27/24 11:05:55 a.m.
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Mr. Speaker, I heard my colleague make some quotes about $24,000 contracts and $100,000 contracts. This is a $20-million middleman contract. It is absurd and it was done with no accountability, no contracts and nothing of any sort to show what the money was for. It was a shovelling of taxpayer money into the pockets of a few chosen so-called IT consultants who are really just middlemen. It is something that is beyond the realm of what Canadians see as acceptable. Would my colleague please address the fact that this needs to be explored; but also explain to the House why her party filibustered, obfuscated and tried to hide this from Canadians for almost two years?

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Ms. Jennifer O'Connell

Feb/27/24 11:06:52 a.m.
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Mr. Speaker, we did no such thing. While the member opposite stands up and defends his party's record, let me just point out again April 1, 2015. While his leader sat around the cabinet table, their government approved $541,000 in IT, technology and telecommunications consultants for the very same company that the Conservatives are criticizing. I acknowledge that there is a need to get to the bottom of what happened here and to fix the procurement process, but when Conservatives talk with outrage, we should know that it is very fake, given their record. I would ask for unanimous consent to table, in both official languages, the Coredal-Conservative contracts in this House so the members opposite can see just how much money they spent.

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Ms. Jennifer O'Connell

Feb/27/24 11:07:43 a.m.
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The Deputy Speaker

Feb/27/24 11:07:48 a.m.
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Does the hon. member have consent? Some hon. members: No.

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Mr. Luc Thériault (Montcalm, BQ)

Feb/27/24 11:07:58 a.m.
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Re: Bill C-15

Mr. Speaker, I would call for a bit more decorum in the House. First, I think it is important to say that the Bloc Québécois will be supporting this motion as a matter of principle. The leader of the Bloc Québécois was the first to call for an independent inquiry, the implementation of a reimbursement procedure and oversight of the agency. The leader of the official opposition is merely blowing smoke by saying that his party reacted when it saw the $12 million. I am sorry, but the truth is that no one on this side of the aisle was aware of this before the Auditor General’s report. The proof is that the only time ArriveCAN found its way into an appropriation bill is in a note to the supplementary estimates (C) for 2021-22, on which we voted at the end of the year, in March 2022, in the form of Bill C-15. If the Conservatives noticed this when we studied the supplementary estimates (C) for 2021-22, why did they not oppose any of the appropriations? If they had, we should have voted on this appropriation in particular. Instead, all the parties voted in favour. The Conservatives are blowing smoke, but this kind of thing should never happen again. What I want to know from my colleague is whether her government will finally call an independent inquiry so that we can see all of the ramifications in connection with these two cronies.

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Ms. Jennifer O'Connell

Feb/27/24 11:09:54 a.m.
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Mr. Speaker, I acknowledge that all parliamentarians should be very concerned about what we have learned. I thank the hon. member for his advocacy on this. We do support the ongoing investigations. There are several, in terms of the Auditor General. There is now the Information Commissioner, who we also support. The CBSA has acknowledged that it will work with them. As I said in my speech, we do want to get to the bottom of what happened here. The agency has already put in place a number of measures to improve the procurement process but it is also very open and willing, based on the further investigations that happen and based on the further work of the House and the committee, to implement recommendations that will ensure that this does not happen again. I acknowledge my hon. colleague pointing out the smoke and mirrors from the Conservatives, because they raise no such issue except when they think it benefits them politically, except, again, as I pointed out in my speech, those in glass houses, given their history with this very company.

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Mr. Gord Johns (Courtenay—Alberni, NDP)

Feb/27/24 11:11:12 a.m.
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Mr. Speaker, while we are hearing Conservatives and Liberals fight over who started with which highly paid consultant and who spent more, we actually need to get to fixing the problem and have that conversation. This is just the tip of the iceberg, in terms of what is going on at CBSA and ArriveCAN. This is not just deeply concerning, as my colleague talked about. This is outrageous. We saw Deloitte go from $11 million in outsourcing in 2015 to $275 million, PricewaterhouseCoopers from $20 million to $115 million, and KPMG from $3.9 million to $48 million. It has gone up 546%. It doubled under the Conservatives. It has skyrocketed under the Liberals. This is on top of layers and layers of commissions that these big firms are taking, including GC Strategies. They talk about cutting outsourcing by 15%. It will put them at only 464% above when they started in 2015. When are we going to see a full investigation, broadening beyond the ArriveCAN app, which includes all of the big six and all of the outsourcing? When are they actually going to demonstrate that they have a plan to cut the outsourcing and put those services and those jobs back through the public service, so that taxpayers are not paying these lucrative, highly-paid consultants tons of profits on the taxpayers' dime?

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Ms. Jennifer O'Connell

Feb/27/24 11:12:48 a.m.
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Mr. Speaker, in fact, I mentioned in my speech that the CBSA has already put in place conditions to cancel or no longer move forward with management consultants. There is more work to be done, based on the results of some of the work done in multiple reports. I also want to point out that one of the things highlighted by the AG was the fact that the CBSA routinely approved and paid invoices that contained little or no details of the work completed. This is a very serious issue, an issue that, again, the Conservatives seem outraged about, yet they themselves did the same with the very same companies. To my hon. colleague's question, this is why CBSA has also initiated a full review of CBSA procurement practices. It is because we want to make sure, as I said in my speech, that Canadians see value for money and that there is transparency in the system. This is not something that just happened overnight, but we are committed to fixing it and giving that assurance to Canadians.

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Mr. Francis Scarpaleggia (Lac-Saint-Louis, Lib.)

Feb/27/24 11:14:10 a.m.
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Mr. Speaker, I am disappointed that unanimous consent was not given to table these very important documents, which are very revealing of how the previous government managed things. I am also shocked by the obvious cozy relationship that existed between the previous Conservative government and this firm, and the very lax contracting policies that left us documents with words such as “work unspecified”. Does the member not feel that perhaps this cozy relationship and these lax practices might have emboldened GC Strategies going forward?

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Ms. Jennifer O'Connell

Feb/27/24 11:14:52 a.m.
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Mr. Speaker, my hon. colleague has posed yet another question about this situation. That is why I am happy to see that the CBSA and the commissioner are working with all agencies to look into this. In fact, they have also reported any concerning allegations to the RCMP. As my hon. colleague raised, this company has a long-standing history with the Government of Canada under the previous Conservative government, so perhaps it became very used to working in this system. I do not know, but I do think it is important that we not only get to the bottom of this and look at what happened here but also, more importantly, fix procurement across the system.

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Mrs. Julie Vignola (Beauport—Limoilou, BQ)

Feb/27/24 11:15:50 a.m.
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Mr. Speaker, we are gathered— Some hon. members: Oh, oh!

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The Deputy Speaker

Feb/27/24 11:15:59 a.m.
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We are restarting the debate with another member, which is an opportunity for that person to present without interruption. The hon. member for Beauport-Limoilou.

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Mrs. Julie Vignola

Feb/27/24 11:16:16 a.m.
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Mr. Speaker, we are gathered here today to discuss a Conservative Party opposition motion. While we expected to have another of many motions on the carbon tax, which does not apply in Quebec and represents less than 0.15% of inflation, it was a wonderful surprise to see that we were going to talk about something else. Honestly, that feels good. Today's motion is on the ArriveCAN application, a matter that has been before the Standing Committee on Government Operations and Estimates for study since October 22 and for which I have the pleasure of reading every document that we receive. In fact, I have prepared a table of contents, and, so far, these documents represent 27 pages of table of contents. That will give members an idea. What is more, I have not even finished it all yet. I also want to point out that my hon. colleague from Terrebonne, who is also examining the ArriveCAN app at the Standing Committee on Public Accounts, is the next speaker. I will be sharing my time with her. So far, we have met with 46 witnesses and received two briefs, as well as tens of thousands of pages of documents. Just to give members an idea, the table of contents so far is 27 pages long. Naturally, I have not read it all yet. Reading is one thing, analyzing is another. Connecting each piece of information to form a cohesive and coherent whole will take more than five minutes. It will take more than a 15-second sound bite on social media. Why introduce this motion today if the subject is being studied in committee? Some of us may be wondering. This is one of the questions I will attempt to answer in my speech by giving an overview of the situation as we understand it so far. I will talk more about what ArriveCAN is and about what has happened since 2022, in other words, about what we have learned. ArriveCAN is an app that travellers were obliged to use for declaring their vaccination status at customs. The first contracts for ArriveCAN date from 2017, long before the pandemic. The aim of these contracts was to create an app that would facilitate declarations at Canadian customs. The health aspect was added to the app in 2020. That is when everything appears to have started going off the rails. How much was the app supposed to cost at first? So far, the answer appears to be $80,000. In 2022, it was to cost around $250,000, after a team of young programmers copied the app. The team told us in committee that copying an app is much easier than starting from scratch but that, even if they had created it from scratch, applying the security codes and updates, it would not have cost $54 million, the number that was being bandied about at the time. We are now at a cost of $59.5 million. After that, we found out more about ArriveCAN and its cost. Our investigation revealed that consulting firms had been given hefty contracts. What did these consultants do? Essentially, they turned on their computer, accessed LinkedIn to find specialists and listed them along with their daily fees. Incidentally, the consultants invoiced between $1,000 and $1,500 a day for specialists. However, we found out through the ombud that 76% of the people on the list of IT specialists submitted by GC Strategies never worked on the app. Other specialists, who were not on the original list, and with who knows what qualifications, did the work. I hope people are following me. That is essentially what the consulting firms did. At the end of the day, they invoiced 15% to 30% to submit names. In short, 15% to 30% of the daily fees invoiced were for specialists who did not end up working on the app. That reminds me. Remember the two guys who set up a company and, within seven days, had a $237-million contract for 10,000 ventilators? They took that contract and gave it to Baylis Medical, a company owned by a Liberal MP who lost his seat in the 2019 election. If we apply that same percentage, 15%, which is the minimum, that means those two guys pocketed $40 million seven days after starting their business. That sounds a lot like GC Strategies, but in this case, things started well before the pandemic. Things started in 2015 for GC Strategies and in 2007 for Coredal Systems Consulting. That is the Canadian dream, being a consultant and having an extraordinary ability to find people on LinkedIn. There are similarities there. People set up a business in their basement, take a quick look around and end up with millions of dollars in their pocket at the end of the day. This is all strangely reminiscent of a system that we need to study, analyze and investigate. GC Strategies is not the first of its kind. Its predecessors include companies such as Coredal Systems Consulting and FTI Professional Grade. This is a big deal. The Auditor General says she has never seen worse record-keeping than in the ArriveCAN books. That is a big deal. Today's motion is about accountability. Yes, the opposition certainly has a role to play in drawing attention to information like that. However, it is not up to Julie Vignola alone, or the member for Terrebonne or a small research team to sift through tens of thousands of pages to find every item related to ArriveCAN. At some point, accountability is also the government's responsibility. It knows where it invested taxpayers' money. Speaking of taxes, it would be nice if companies hired by the government did not use tax havens, which may be the case for one company that got millions through the ArriveCAN contract. I would encourage everyone to read today's La Presse. We are being criticized for voting in favour of ArriveCAN. I will point out the estimates in question. ArriveCAN is mentioned in the supplementary estimates (B), 2021-22, on pages pages 2-2 and 2-82. ArriveCAN is also mentioned in the supplementary estimates (C), 2021-22, on page 1-19. These budgets were voted on as a block. If we had voted against them, like the Conservative Party members did, we would have been voting against the construction and management of indigenous women's shelters, against financial support for festivals and tourism, against community revitalization, against financial support for mental health and against support for Afghan nationals, support that the member for Charlesbourg—Haute-Saint-Charles was screaming for in the House. We also would have been voting against the procurement of PPE. There is a problem. We agree with the motion, but we also need to put the CBSA under third-party management, because whistle-blowers have been warning of serious problems for quite some time, particularly regarding passports, and members of both the Conservative Party and the Liberal Party have turned a blind eye to these problems. It is time to put this agency under administrative supervision. We will vote yes, but we need to go even further.

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Mrs. Brenda Shanahan (Châteauguay—Lacolle, Lib.)

Feb/27/24 11:26:20 a.m.
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Mr. Speaker, I have a great deal of respect for my colleague and for the work that the Bloc Québécois does on matters of finance, because we both think that it is important to manage the public purse wisely. I am afraid that the aspersions she is casting on Frank Baylis, a former Liberal MP, are not correct at all. Mr. Baylis chose not to run in the 2019 election. His company was created by his mother, a new Canadian who arrived from the Caribbean Islands in the 1940s. She was a nurse and she started this company to distribute medical products. Today, it is worth billions of dollars. Mr. Baylis did not need to get contracts. He helped someone in the sector, a Conservative donor, who wanted to help by providing ventilators. I would like my colleague to apologize for what she said about the hon. former member.

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Mrs. Julie Vignola

Feb/27/24 11:27:50 a.m.
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Mr. Speaker, first of all, I did not name the member, I simply named the company. Second, I did not lie because FTI Professional Grade Inc. did indeed receive a contract seven days after the company was created. It then transferred that contract to Baylis Medical. Seven days after it was created, that company, FTI, received a $237-million contract for which we can assume there was a 15% to 30% commission. So I did not make anything up. All one needs to do is follow the paper trail in the newspapers as well as the budgets and contracts allocated during the pandemic.

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Mr. Greg McLean (Calgary Centre, CPC)

Feb/27/24 11:28:42 a.m.
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Mr. Speaker, I appreciate the comments made by my colleague from Quebec, but I have other comments and questions about other companies that received a lot of grants and contracts from the Liberal government during the pandemic. In my opinion and that of my colleagues, the Liberals hid behind the pandemic to hand out a lot of money to their friends. Is the member aware of the other contracts like the one that went to Medicago? What has been happening with Medicago from the time the contract was awarded until now?

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Mrs. Julie Vignola

Feb/27/24 11:29:28 a.m.
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Mr. Speaker, when the pandemic started, we might recall that, in terms of vaccine procurement, the federal government put all its eggs in one basket. It reached an agreement with the Chinese government, but the agreement fell through. We were left in the lurch, with no access to vaccines. Then the Government of Canada decided to diversify its potential pool of vaccine producers, including Medicago, but not without some risk. Some producers, not just Medicago, failed to deliver vaccines for various reasons and, unfortunately, the Government of Canada lost its deposit payment. Following a decision by Mitsubishi Tanabe Pharma, Medicago no longer exists. A decision was made. Yes, we lost money, but it could have easily turned out in our favour. There was a race to be the first to manufacture vaccines and get access to the market.

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Mr. Charlie Angus (Timmins—James Bay, NDP)

Feb/27/24 11:30:59 a.m.
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Mr. Speaker, I was on the committee that looked into the spending. We looked at Baylis Medical. We looked at Palantir. We looked at WE Charity. We found no evidence on Baylis. There were certainly many questions about WE, but the question about the spending on ArriveCAN, to me, is a question of a lack of oversight. The $59 million could have been spent on 32 different contractors. Where was the accountability? Even in the midst of a pandemic, when we were trying to get money out the door to get tools that could help, this is an issue of a fundamental failure of oversight, and I think that is the question we need to focus on.

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Mrs. Julie Vignola

Feb/27/24 11:31:42 a.m.
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Mr. Speaker, unless we keep our eyes on the big picture, spending can easily get out of control. That is true for individuals, and even truer for governments. We are dealing with a situation where the government not only lost sight of the big picture, but also seems to have spent recklessly without making any checks at all. The problem also relates to problems the agency has been having for a number of years.

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