OGGO Committee Report

SUPPLEMENTARY OPINION FROM THE CONSERVATIVE PARTY OF CANADA

Accessibility and Simplification: The Government of Canada must cut bureaucratic red-tape to incentivize diverse business partnerships.

Conservative members of the House of Commons Standing Committee on Government Operations and Estimates thank the many witnesses who provided their insights on the procurement process for Small and medium-sized enterprises (SMEs). We agree in principle with many elements of the report prepared by the Operations and Government Estimates Committee, namely that the Canadian procurement system must be modernized. However there were some key elements heard during witness testimony that we believe were under-represented in the report. As such, we have provided these supplementary observations to accompany the report presented by the committee.

There were many SME representatives that spoke to the committee about their experiences dealing with the federal procurement process. While many of the report recommendations include reviewing set-aside programs and data collection, the recommendations dealing with complexity and red-tape may not be adequate in reducing barriers to SMEs.

The Procurement Ombudsman, Mr. Lorenzo Ieraci, told the committee that a vast majority of questions coming to his office from SMEs are in regards to the procurement process, stating “[t]hey’re not necessarily understanding the rules, the procedures, or what they have to do in order to do business with the Government of Canada...”[1] He later expanded this, noting that the various rules required for submitting bids “…impose a burden on some suppliers [he’s] spoken with in terms of being able to submit proposals that will be deemed successful or that can qualify as per the requirements.”[2] Expanding set-asides and targets for government procurements is an important facet to engage SMEs, but it must be done in tandem with a vigorous cross-government simplification for submitting bids.

Mr. Marc LeClair, Special Advisor to the Métis National Council, told the committee “The complexity of the procurement instruments is a problem. Finding out about the opportunities on a timely basis so that you can prepare a bid or prepare a joint venture partner is a problem because a lot of the contracting will require indigenous companies to enter into a joint venture with an established player.”[3] His colleague, Mr. Brian Card agreed, stating “…it's the complexity of getting your foot in the door with the federal government. It's all the hoops that you have to go through.”[4] There are further burdens in administration that prevent indigenous businesses from accessing government contracts, with Mr. Card pointing out that “…the aboriginal community is not being given a chance to bid. Because they haven't gone through the application process, they haven't been pre-qualified.”[5] Eliminating some of these barriers in the application process would signal to indigenous communities that they are not only eligible to do business with the Government of Canada, but that they indeed have the capacity to fulfill the requirements needed to do it successfully.

In order to ensure that Canada’s procurement system is benefitting both Canadian industry and SMEs, the government must commit to concrete action that will simplify the procurement process. Unlike large-scale businesses, SMEs do not necessarily have the capacity to review, revise, and apply for 500+ page Requests for Proposals (RFPs). Ms. Annette Verschuren, Chair and CEO of NRStor Inc., told the committee that one of the greatest barriers to SMEs in Canada “…is the amount of regulation on everything. The complexity of applying for these things is extremely important. As we design anything in our government, I really believe the execution may be more important than the strategy.”[6] Ms. Verschuren and Ms. Elyse Allen, President and CEO of GE Canada, indicated that despite women owning nearly half of all new businesses, they are not able to access many government contracts.[7] Increasing set-asides alone will not change the administrative barriers being faced by SMEs, women-owned, indigenous-owned, and otherwise.

There must be a tangible commitment to cutting down the administrative burden for businesses seeking to engage with the federal government. Smaller companies do not necessarily have the resources to dedicate one single staff-member to seeking out and monitoring a bid. Further, there must be a real commitment to simplifying the procurement process whether by stream-lining the application process, moving smaller procurement projects and everyday contracts to a web-based platform like GSAdvantage as used in the U.S., or  work on direct partnerships with community-based contractors like those in Indigenous communities across Canada. The government’s procurement process must be able to accommodate the broad array of businesses in Canada in a way that allows for smaller companies to compete at par with larger companies. This would encourage innovation and expansion for these businesses while contributing to an overall stronger economy that bolsters and supports Canadian entrepreneurship.

Finally, it was noted that throughout the study, the testimony provided by the Department of Public Works and Government Services and Department of Indigenous and Northern Affairs Canada seemed to deny or downplay many of the criticisms outlined by private sector SME and Indigenous advocacy group representatives. This outlines a clear and immediate conflict with the commitment to reconcile government policy with departmental action or inaction. In order for there to be any semblance of success in reforming Canada’s procurement system, the departments responsible for managing or overseeing procurement projects must take responsibility for their role in contributing to its inefficiencies, and acknowledge that their choice in expediting the report recommendations will be the deciding factor in whether there will be true, actioned, and tangible reform or just another item “underway with challenges”.