Finance Minister François-Philippe Champagne and Procurement Minister Joël Lightbound have instructed the public service to examine existing and future federal contracts to identify potential cost savings. They have requested senior procurement and government services officials to submit a comprehensive proposal for this review within 45 days. Champagne emphasized the need for specific measures such as comparing contract prices globally, incorporating international best practices, giving priority to Canadian suppliers, exploring joint purchasing opportunities with provinces and territories, updating procurement policies, and more, as outlined in a social media post.
This initiative is part of the government’s broader expenditure evaluation. Champagne is expected to present a budget in October, with Prime Minister Mark Carney indicating a desire to reduce government spending. Carney stated during the Liberal caucus retreat in Edmonton that the government is committed to implementing fiscal discipline and making tough decisions to secure a better future.
Previously, Carney and Champagne had urged ministers and departments to seek significant savings and streamline regulations. The issue of government contracting and outsourcing has been under intense scrutiny, particularly during the tenure of Justin Trudeau, Carney’s predecessor. A recent report from the government’s procurement watchdog highlighted the urgent need for “fundamental change” in the current contracting system, recommending the establishment of a centralized body to oversee all government purchases.
Both the Procurement Ombud Alexander Jeglic and Auditor General Karen Hogan have raised concerns about procurement practices in recent years, particularly regarding outsourced contracts. They criticized the handling of the ArriveCan app project, citing poor record-keeping and a significant cost increase due to reliance on external contractors. Following these findings, GC Strategies Inc., the primary contractor for ArriveCan, was banned from bidding on government contracts for seven years. The government watchdogs also released reports on multiple contracts awarded to consulting firm McKinsey & Company, highlighting lapses in procurement practices and potential favoritism in contract awards.
Moreover, the Auditor General’s report revealed deficiencies in the management of the Canada Emergency Business Account (CEBA), leading to inadequate cost oversight. The government has referred several cases to the RCMP for suspected invoicing fraud by IT subcontractors. These actions reflect the government’s commitment to enhancing transparency and efficiency in its procurement processes.