“Procurement is going to be our biggest obstacle here,” former Chief of the Defence Staff of the Canadian Armed Forces Rick Hillier recently said on a panel hosted by Security Disruptors, a group focused on hybrid warfare. In a discussion about how technologies like artificial intelligence and drones are reshaping military strategy, his statement was a stark conclusion: Canada’s complex purchasing processes might be the greatest barrier to enhancing our security posture.
As Hillier put it: “We are going to need a procurement revolution that we have never seen.”
Most Canadians have known this for some time. Procurement disasters like ArriveCAN, the Phoenix pay system, the Canada Border Services Agency Assessment and Revenue Management system, and the colossal contracts awarded to McKinsey & Company and Accenture have long demonstrated the need for greater transparency in procurement to prevent their reoccurrence, fight corruption and generate much-needed savings.
So far, the Carney government’s early moves in procurement have been well-intentioned on all these fronts. The government is making an obvious effort to save, although cuts across the public service are falling hardest on young people who bear little blame for the above-noted scandals. Worryingly, the government may also be adding complexity to an already overwrought system of procurement rules by adding yet more fine print to a Byzantine system of rules.
Transparent procurement is not only a low-cost way to save money; it also makes it easier to engage in evidence-based policy and law reform to improve accountability.
It also remains to be seen whether an interim policy on reciprocal procurement actually reduces the approximately 10 percent of Canadian federal procurement spending that goes to American suppliers.
If cutting costs is the goal, Canada might want to look at countries like the United Kingdom, where the recently passed Procurement Act — with enhanced transparency measures such as the default publication of contracts worth more than £5 million — is anticipated to save hundreds of millions of pounds each year. Such transparency will allow easier benchmarking and price visibility as well as stronger accountability when it comes to contractual performance. When Slovakia introduced similar transparency requirements, procurement costs declined dramatically.
Transparent procurement is not only a low-cost way to save money; it also makes it easier to engage in evidence-based policy and law reform to improve accountability. When more contractual information is published by default, it inherently provides better value for money by allowing oversight actors to identify unnecessary or improper spending and competitors to propose better services.
By contrast, Canada’s answer to proactive transparency in procurement has been the Open Government portal — a repository of often unreliable data that has been known to amplify misinformation. The data on that site is not subject to meaningful oversight or review, and quality control audits of the data are not proactively published.
Shopify CEO Tobias Lütke has rightly identified the possibility of scouring such public data sets for “monkey business.” But this is a fruitless exercise if the data is unreliable. Journalists covering the federal procurement beat in Canada — most of whom do not use that data — know that all too well.
It is also astounding that Canada has lost so much through procurement scandals, yet continues to deprive the Procurement Ombud of the power to issue binding orders to address problems and intervene before spending mishaps turn into scandals. The Ombud does not even have the power to compel documentation in their investigations and is often forced, like an average citizen, to use the Access to Information system to do their job, a system that is mired in excessive delays and overuse of exemptions.
A Promised Review That Falls Short
Mark Carney campaigned on a pledge to conduct an “objective review” of that system. Instead, his government has launched a perfunctory review that can hardly be described as objective: it essentially amounts to the government reviewing itself, which creates a massive conflict of interest and little incentive for change. This initiative represents a significant missed opportunity for savings, since the current law relies on a burdensome, reactive approach to accessing government records that urgently needs to be replaced by a shift to a model based on proactive disclosure.
The cost savings of such a system would be enormous. For example, a push toward centralization and openness by default — like Norway’s easy-to-use system, in which public servants can elect to release records and the public can request them without intermediation — would cut much unnecessary work, such as processing of records, by giving access to information coordinators. Additionally, AI-driven technologies could find, translate or publish documents in many cost-effective ways.
The problem is that freshly elected governments quickly grow addicted to foot-dragging and spin. It remains to be seen whether this prevents the Carney government from taking long-needed measures like streamlining government record-keeping and updating the outdated systems used to store and manage government information.
Too often, rather than fixing such problems, instruments of transparency and accountability become seen as irritants. This is why the Access to Information Act has not been updated in more than four decades. It is also why the statutory obligation to review the Lobbying Act every five years has been ignored, and such a review has not been conducted since 2012. Inaction on that last item is likely to be an ongoing political vulnerability for Carney.
The recent history of inaction has resulted in an inevitable string of procurement scandals from which our governments have not learned that basic transparency would go a long way in ensuring our prosperity and repairing trust in government.
