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Minister’s Transition Book 2: Departmental business—March 2025

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Note: Shared Services Canada (in a separate binder).

Plans and Priorities at Public Services and Procurement Canada

As of March 2025, Public Services and Procurement Canada (PSPC) has approximately 19,000 employees.

Public Services and Procurement Canada Core Responsibilities

In this section

Acquisitions

Infrastructure

Real Property
Engineering Assets
Parliamentary Precinct
Science Infrastructure

$3.7 billion Laboratories Canada projects working with 5 Science Hubs across Canada.

Payments and accounting

Pay Administration
Receiver General

Issues over 405 million payments annually on behalf of federal departments and agencies. The department managed cash flows of $3.55 trillion in 2023 to 2024.

Pensions

Over $15.8 billion in pension payments to over one million active and retired members.

Government services

Translation Bureau
Security and Oversight

Office of Supplier Integrity and Compliance established in May 2024:

Other

Corporate enablers

Minister Mandate Letter Commitments 2020

Innovative and Client-Focused Service Delivery.

Public Services and Procurement Canada-Led
Commitments Met
Public Services and Procurement Canada-Supported
Crown Corporation-Led

Ensure that Canada Post provides high-quality service and better reaches Canadians in rural and remote areas.

Overview of Public Services and Procurement Canada

Public Services and Procurement Canada at a Glance

Procurement of Goods and Services

Property and Infrastructure

Other Responsibilities

The department also has responsibility for:

The Parliamentary Precinct
Federal Laboratories

The revitalization of federal laboratories across Canada to support world-class science.

Engineering assets

Payments and Accounting

PSPC collects revenues and issues payments, maintains the financial accounts of Canada, issues Government-wide financial reports, and administers payroll and pension services across the Government of Canada. PSPC ensures that employees receive timely and accurate pay and benefits and is making progress towards reducing the backlog of pay transactions. The department continues to work with other departments and agencies to further stabilize pay administration, while work is underway to develop a new pay system.

As part of Budget 2024, the Government of Canada allocated $135 million to expand testing and design of a new HR and pay solution for the public service (Dayforce). This decision supports the eventual replacement of the Phoenix pay system and its HR systems.

The Department :

Government-wide Services and Support

Translation

Government Services

Internal Services

PSPC operations are supported by a range of corporate services, including:

Public Services and Procurement Canada: Portfolio Organizations

Partner Departments in portfolio

Shared Services Canada

Responsible for digitally enabling government programs and services. It does this by providing networks and network security, data centres and Cloud offerings, digital communications and Information technology (IT) tools to enable the public service to effectively deliver services to Canadians.

Crown Corporations

Defence Construction Canada
National Capital Commission
Canada Post Corporation
Canada Lands Company Limited

Adjudicative, Regulatory and Oversight Bodies

Office of the Procurement Ombud

The procurement Ombud plays a crucial role in ensuring fairness, transparency, and accountability in federal procurement processes.

Its key functions include:

Payments in Lieu of Taxes Dispute Advisory Panel

Provides advice to the Minister of Public Services and Procurement and heads of Federal Crown Corporations in the event a taxing authority disagrees with the property value, dimension or effective rate applicable to any federal property.

Number of Public Services and Procurement Canada employees

Located in five geographic regions across Canada and in the NCR.

Public Services and Procurement Canada Supply for 2025 to 2026

Mandate

The Estimates process falls under the democratic principle that no money can be spent without the approval of Parliament. This process, which includes the Main Estimates and the Supplementary Estimates, provides elected officials and Canadians with an overview of the Government’s spending plans to deliver on its priorities and mandate.

The Main Estimates outline the proposed budget required for a department to deliver on its programs for the upcoming fiscal year, excluding Budget items. The tabling of the Main Estimates results in two supply bills (interim and full supply) that require approval through a vote. These are normally voted in March and June of every year.

Key Activities

As the fiscal year begins on April 1, Parliament annually approves a standard interim supply of three-twelfths of the Main Estimates (representing the first quarter of the year) to provide government departments with sufficient cash flow to sustain operations while the Main Estimates are reviewed and full supply approved, normally in June as per the supply cycle. Organizations may request additional twelfths when justified, such as when greater expenditures are anticipated in the opening quarter.

Under normal circumstances, Royal Assent of the interim supply bill for the 2025 to 2026 fiscal year is expected to be granted before April 1, 2025.

Partners and Stakeholders

The Main Estimates (interim supply and full supply) is an annual exercise that is managed internally by departments and in collaboration with central agencies.

Key Challenges

The Treasury Board of Canada Secretariat (TBS) is preparing for the possibility that Parliament could be dissolved for a democratic event prior to the end of the fiscal year. In such cases, all business in the Senate and House of Commons would end, including the business of supply:

Key files

Canada and United States Relations

Asylum Seekers, Detainees and Borders

Mandate

PSPC in its role as a common service provider, will continue to support the Canada Border Services Agency (CBSA), the Royal Canadian Mounted Police (RCMP), and Immigration, Refugees and Citizenship Canada (IRCC) for procurements related to asylum seekers, immigration detention and borders.

Key Activities

PSPC has led several procurements over the last few years, on behalf of federal departments, to manage a surge in asylum seekers. The procurements were for a wide variety of goods and services including, for example, accommodations, guard services, social support services, transportation, temporary infrastructure, generators, and other equipment. There was significant public attention on the Roxham Road, Quebec, entry point, as well as on Dev Centre accommodations contract.

PSPC is supporting the CBSA for procurements related to detention of high risk detainees, which became necessary following a decision from provinces to withdraw from agreements to house these detainees in provincial prisons.

More recently, the CBSA, the RCMP, and IRCC have identified additional procurements related to border control and a potential surge in asylum seekers. These requirements have arisen recently as a result of the political context with the United States and have been identified as high priority and in some cases urgent. PSPC is in communication with all three departments and is ready to provide procurement and leasing support, as needed.

PSPC is working with client departments to use standard competitive procurement practices to the greatest extent possible in order to reduce risks and obtain best value for money on procurements related to asylum seekers, detainees and borders. However, several of the procurements have taken place under urgent timelines, and as a result some were awarded without competition. In all cases, proper processes were followed.

Partners and Stakeholders

PSPC continues to support client departments including CBSA, the RCMP, and IRCC for procurements related to asylum seekers, immigration detention and borders. These departments are responsible for managing their programs, providing funding, and defining requirements for the procurements.

Key Challenges

Given strategic considerations and the urgency of requirements, PSPC is called upon to devote significant attention and prioritization to supporting procurements related to asylum seekers, immigration detention and borders.

Procurement of United States Goods and Services

Mandate

It is estimated that United States (US) suppliers are awarded approximately 10% of the value of all Canadian federal procurement contracts, including for defence. Over the past three fiscal years, PSPC has awarded an average of approximately $1.3 billion per year to suppliers located in the US. This excludes Canadian-based suppliers that are subsidiaries of US companies as well as contracts under the Foreign Military Sales program.

On February 1, 2025, the Trump Administration issued an Executive Order to apply tariffs on imports from Canada “to address the flow of illicit drugs across the US northern border.” The Order stated that, effective February 4, 2025, a tariff rate of 25% would apply on all imports of goods from Canada to the US, except for energy products, which would be subject to a tariff rate of 10%. On February 3, 2025, the Trump Administration announced a delay of at least one month for the application of these tariffs, until at least March 3, 2025.

On March 3, the Executive Order announced in February came into effect. In response, the Government of Canada moved forward with 25% tariffs on $155 billion worth of US goods, beginning with a list of goods worth $30 billion effective March 4, 2025, with tariffs on an additional $125 billion in imports from the US to come info force following a 21-day comment period. The Government also announced that other measures, including potential non-tariff measures, remain on the table should the US continue to apply unjustified tariffs against Canada.

On March 6, the US announced a tariff reprieve applicable to Canadian exports that are compliant with the Canada-US-Mexico Agreement (CUSMA) until April 2.

Key Activities

Canada and the US are both parties to the World Trade Organization Agreement on Government Procurement. In 2022, approximately CAD 5.8 billion (USD 4 billion) of Canadian federal procurements were subject to the Agreement. US federal procurement opportunities under the same Agreement are worth nearly USD 130 billion (CAD 184 billion) annually. The Government Procurement Chapter of the CUSMA does not apply to Canada.

Canada currently operates an open procurement system that generally allows firms from every country to bid on federal procurement opportunities, even where trade agreements do not apply. The 2024 Fall Economic Statement announced that starting in spring 2025, the Government will strictly enforce its procurement trade obligations to limit access to Canada’s federal procurement market to Canadians and trading partners that provide Canada with a similar level of access to their public market, with the exception of defence procurement. This reciprocal procurement policy would reduce US access to the non-defence Canadian federal procurement market to what is strictly required under the Agreement.

In addition, PSPC is closely monitoring the trade situation in the US, assessing potential impacts to existing projects, and, in consultation with provincial and territorial counterparts, exploring the use of non-tariff procurement countermeasures as part of a balanced and strong response if needed.

Partners and Stakeholders

Key partners and stakeholders on the response to potential US tariffs, including any potential non-tariff measures, would include the Privy Council Office (PCO) and the Department of Finance Canada (FIN). Key partners on reciprocal procurement include TBS, and Global Affairs Canada (GAC).

Key Challenges

PSPC has incomplete statistical data on the origin of the suppliers it contracts with or the origin of the goods and services it receives, including with respect to the US. The department is, however, taking action to address this and is gathering key information on all contracts that are in the process of being awarded to US suppliers.

The frequent changes in the US approach to tariffs presents uncertainty.

Acquisitions

Large procurements in support of other government departments

Digital Transformation Procurement Overview
Mandate

PSPC is facilitating the procurements associated with digital transformation projects, notably major digital transformation initiatives for Employment and Social Development Canada (ESDC) and IRCC.

Key Service Delivery Projects: Benefit Delivery Modernization

Benefit Delivery Modernization is a multi-year program led by ESDC to replace aging and complex legacy systems with a single, modern, easy to use, and secure software platform. Its goal is to provide a seamless experience for Canadians accessing Employment Insurance and Canada Pension Plan and Old Age Security (OAS) benefits. ESDC was initially granted Benefit Delivery Modernization project authority of $1.8 billion in 2017. Project authority was then increased to $2.2 billion in April 2022, and to $6.6 billion in November 2024.

Through a competitive procurement process, PSPC awarded four Master Systems Integrator Contracts to four qualified Systems Integrators in spring 2021. Work packages are either competed for amongst these four qualified suppliers, or, if appropriate, the work is allocated amongst all four suppliers that work collaboratively in advancing a project. The Minister of Public Services and Procurement has advance contract authority from TBS to award contracts up to a value of $2.6 billion under this program.

The department has also awarded a competitive contract for the Core Technology Platform to International Business Machines Corporation (IBM) Canada, valued at $249 million, and a large competitive contract for strategic transformation advice to Price Waterhouse Coopers valued at $179 million.

Benefit Delivery Modernization is being advanced in four tranches of work, ending in 2031. Work in Tranche one to deliver a new OAS system is currently underway and Tranche two will begin with the issuance of the Employment Insurance Build and Implementation Task Authorization.

OAS is the first benefit to be added to the new Benefit Delivery Modernization Platform and the third release is scheduled for March 2025.

The next benefit to be on-boarded will be Employment Insurance with the Build and Implement phase, which launched at the beginning of January 2025.

Key Service Delivery Projects: Digital Platform Modernization

The Digital Platform Modernization procurements will provide IRCC with a modernized web presence and supporting information technology systems, allowing users to access services in a streamlined way and have visibility into the status of their transactions. 

The Client Experience Platform will provide a new interface wherein clients can interact with IRCC in a manner that allows for a simplified and intuitive experience across multiple channels and devices. The Client Experience Platform contracts were awarded to Accenture Inc. and Salesforce Canada Corporation on July 14, 2023, for a combined initial contract value of $85.4 million. In June 2024, the Temporary Resident Visa business line entered into production. Applicants are able to apply for visas and track the application progress online. On December 11, 2024, adult passport renewal launched online for eligible applicants for the first time, Canadians have the option to renew their passports online.

The Case Management Platform will replace IRCC’s current immigration application system, the Global Case Management System, used for processing all immigration and citizenship related applications. The system contains over 60 million personal records and is used by over 20,000 users across six government departments. Following a competitive procurement process, the Case Management Platform contracts were awarded to Accenture Inc. and Microsoft Corporation on September 19, 2024, for a combined initial contract value of approximately $122 million.

A contract for Programme Management Strategic Advisory Services was awarded on May 3, 2023, to Ernst and Young Limited Liability Partnership (LLP) for an initial contract value of $9.6 million to provide a team of experts to support transformation objectives of Digital Platform Modernization.

Examples of strategic advisory services that are currently being provided include:

Canadian Dental Care Plan
Mandate

The Canadian Dental Care Plan (CDCP) is led by Health Canada (HC). PSPC was responsible for managing the procurement to select a private partner for the delivery of dental claims processing, and is now responsible for administering the contract. This has involved engaging with industry, developing procurement documentation, conducting the procurement process and managing the resulting contract associated with the program.

Key Activities

In December 2023, a contract was awarded to Sun Life, worth approximately $750 million for a five-year operational period, to provide claims processing for the CDCP. The Operations Phase launched on May 1, 2024, and claims processing services began. This phase is running simultaneously along with the Start-up Phase, which will be completed by April 2025. The CDCP contract contains an Indigenous Participation Component, designed to support Indigenous economic development.

As of November 1, 2024, the scope of the CDCP expanded with the launch of services that require preauthorization as well as paper claims processing. As of February 2025, over 1.5 million Canadians are using the CDCP. All current members will be required to re-apply between March and April of 2025 to keep their eligibility under the CDCP. All remaining eligible Canadians will be able to apply in May 2025 with cohorts rolling out over a six-week period, ending in June 2025. The exact roll-out is still being finalized by HC.

The next steps consist of Sun Life implementing and finalizing a Member portal, a HC user interface and a robust fraud risk management program.

Partners and Stakeholders

As the department responsible for providing dental care coverage to Canadians, HC is the program authority and main partner for the CDCP.

Other partners include:

HC has also engaged and collaborated with external stakeholders including academic experts in oral health and oral public health, national professional organizations (such as the Canadian Dental Association), provinces and territories, dental care providers, and the insurance and claims processing industry.

Key Challenges

Since the implementation of services that require pre-authorizations on November 1, 2024, HC has identified issues with the adjudication rules adapted from an existing federal program. These rules are not functioning as intended when applied to the CDCP, resulting in a very high denial rate of the requests. To resolve this situation, changes to the adjudication process are necessary. A few specific items, such as crowns and dentures, have been reviewed by Sun Life and different rules have been implemented. The next step would be to complete an assessment of other items and to implement updated rules, as needed, to ensure the successful processing of these requests. A Task Authorization will be signed shortly to commence this work.

The implementation of contract amendments and task authorizations necessary for important work or clarification under the contract have taken longer than anticipated for all parties. PSPC is actively working with HC and Sun Life to establish a change management process and to determine where timelines for reviews and approvals could possibly be tightened.

Procurement policy

Procurement Strategy for Indigenous Businesses
Mandate

Federal procurement is an important lever for increasing socio-economic benefits for Indigenous businesses and Peoples. The Indigenous business sector is also a key driver of wealth in Indigenous communities and in closing the socio-economic gaps between Indigenous Peoples and non-Indigenous people.

Key Activities: Five Percent Target

To create more opportunities for Indigenous businesses to succeed and grow, PSPC, Indigenous Services Canada (ISC) and TBS are implementing approaches to ensure that at least 5% of the total value of federal contracts are awarded to businesses owned and controlled by Indigenous Peoples. In 2022 to 2023, the latest year for which data is available, the Government of Canada awarded $33.5 billion in contracts to businesses, with $1.6 billion (6.3%) going to Indigenous businesses. Additional efforts are needed for PSPC to meet the target as the department awarded $143 million (3.4%) of the total value of its procurements to Indigenous businesses in 2023 to 2024.

Innovative approaches are being put forward to accelerate the progress in increasing opportunities for Indigenous participation in federal procurement. The department is also working to accelerate progress through engagement and outreach efforts with Indigenous suppliers. In 2023 to 2024, the department held 524 events to specifically enhance collaboration with Indigenous businesses; these events had a total of 8,382 participants.

Key Activities: Modern Treaties and Nunavut Agreement

There are currently 25 modern treaties, 22 of which contain procurement obligations. The department works with Indigenous Modern Treaty Partners to establish implementation plans and measures to implement those provisions. It also provides support to procurement officials involved in procurement projects subject to modern treaties and self-government agreements to help them meet these obligations.

The Nunavut Agreement is a Comprehensive Land Claim Agreement that contains procurement obligations and the requirement for Canada to develop its procurement policies in close collaboration with Nunavut Tunngavik Incorporated. PSPC continues to provide procurement services, advice and guidance on Nunavut Settlement Area procurements.

Key Activities: Procurement Strategy for Indigenous Business

PSPC supports ISC in implementing the Procurement Strategy for Indigenous Business (PSIB), including ensuring that eligible procurements are leveraged. It aims to increase the number of suppliers that are at least 51% owned and controlled by an Indigenous person or joint ventures majority-owned and controlled by an Indigenous business bidding for, and winning, federal contracts. Contracts awarded under PSIB are a key part of meeting the 5% target. Under the PSIB program, businesses submitting bids must attest to meeting the Indigenous business definition at the time of submission and throughout the contract, with their certification subject to audits by ISC at any time.

Key Activities: Transformative Indigenous Procurement Strategy

The Government of Canada, led by ISC and supported by the TBS and PSPC, continues to actively work with Indigenous partners to co-develop a Transformative Indigenous Procurement Strategy that will improve procurement policies, safeguards, and processes for Indigenous businesses.

Partners and Stakeholders

PSPC, ISC and TBS continue to build external partnerships that will help meet the 5% target. Organizations involved include:

Key Challenges

Results to date show that while the Government of Canada is overall achieving the 5% target overall, PSPC itself must significantly increase procurement efforts to align with this objective. Stronger action and intensified collaboration with stakeholder departments will be critical to expanding opportunities for Indigenous businesses.

Questions have arisen in recent months, including at parliamentary committees, about potential misrepresentation in the PSIB program, with concerns that some businesses that are not truly Indigenous may be benefiting improperly. To address these concerns, ISC is auditing the businesses listed in its Indigenous Business Directory to strengthen the directory's integrity. Additionally, PSPC is exploring options to address cases of misrepresentation, including Indigenous misrepresentation, through contracting measures. This significant issue demands ongoing attention and possibly additional measures to prevent and deter misrepresentation.

Supporting Canadian Small and Medium Sized Enterprises
Mandate

In line with Budget 2021 commitments, the department implemented a Policy on Social Procurement to leverage the government’s purchasing power to increase supplier diversity among disadvantaged or underrepresented businesses.

The 2024 FES announced the government’s intention to introduce the Small Business Innovation and Procurement Act to obligate federal government departments and agencies to procure a minimum of 20% of goods and services from small and medium sized Canadian businesses and a minimum of 1% of goods and services from innovative firms.

Further, Budget 2024 announced the government’s intention to explore the possibility of creating a program to prioritize doing business with small Canadian businesses and Canadian innovators.

Key Activities

PSPC is exploring initiatives to increase both the number of small and medium suppliers participating in federal procurements, including those owned by members of underrepresented groups, and the value of contracts awarded to them. These activities mainly target engagement and outreach to small Canadian enterprises.

Through its six regional offices, PSPC helps small and medium enterprises understand and navigate the federal procurement system. It provides assistance to businesses on procurement tools, processes and resources available to help them sell to the Government of Canada.

PSPC also supports Innovation, Science and Economic Development Canada (ISED) in the creation of a small business innovation program to help federal departments and agencies meet the new procurement targets for Canadian small businesses and innovators. This program will focus on the development of new procurement service standards and changes to Government Contracts Regulations. ISED aims to establish the new program in spring 2025, following targeted stakeholder engagement.

PSPC also supports procurements for the Innovation for Defence Excellence and Security (IDEaS) program in its role as central service provider. DND’s IDEaS program aims to promote Canadian innovations of interest to the Canadian Armed Forces (CAF) and, while open to businesses of all sizes, does provide opportunities for small and medium enterprise participation.

Partners and Stakeholders

PSPC aims to maintain consistent engagement with representatives of various industries and to learn about the barriers that some businesses face in joining the federal supply chain. The goal is to bring a positive economic impact for thousands of Canadian small businesses, including those owned or led by groups who are often underrepresented in federal procurement supply chains. Ongoing engagement with these groups allows for discussions on shared issues and feedback from industry, and provides a venue for disseminating critical information about federal procurement.

The National Supplier Advisory Committee is an ongoing consultative body co-chaired by PSPC and a representative of the private sector. It is composed of representatives from leading national industry associations who provide advice, feedback and make recommendations concerning procurement issues, including improvement of the procurement process.

Key Challenges

The department continues to modernize and simplify its procurement processes, but small and medium enterprises still experience challenges in navigating the federal procurement process. There is also a need to better understand how federal procurement can support innovation given the complexity of trade agreements and government contracting regulations.

Concerning supplier diversity, the department is considering options to align efforts to increase the participation of Indigenous businesses in federal procurement with work to increase the diversity of bidders under the Policy on Social Procurement.

Reciprocal Procurement
Mandate

Budgets 2021 and 2023, as well as the 2023 Fall Economic Statement, committed to pursuing “reciprocal procurement policies to ensure that goods and services are only procured from countries that grant Canadian businesses a similar level of market access.”

The 2024 FES announced that starting in spring 2025, the Government will strictly enforce its procurement trade obligations to limit access to Canada’s federal procurement market to Canadians and trading partners that provide access to Canada, with the exception of defence procurement. The 2024 FES further indicated the Government’s intention to explore the possibility of placing domestic content conditions on the participation of foreign suppliers in federally-funded infrastructure projects and of creating a program to prioritize doing business with small Canadian firms and Canadian innovators.

Key Activities

Since 2021, departments have collaborated to develop three approaches to reciprocal procurement. Pursuant to the FES announcement, the implementation of these components will be phased.

  1. Establish a reciprocal-by-default procurement system where the ability of suppliers to bid for federal procurements is based on trade agreement applicability
    • PSPC is working with TBS, GAC, and other procuring departments to initially implement, by June 2025, strict reciprocity for new federal procurement processes, excluding defence procurements, based on the location of the supplier. Under this model, only Canadian suppliers and suppliers from countries that have a trade agreement with Canada would be allowed to compete for procurements subject to the relevant trade agreement. An appropriate system of exceptions will be developed to exclude key strategic commodities and to permit procurement from non-trading partners where necessary
    • subsequently, in collaboration with TBS and CBSA, PSPC will explore the possibility of transitioning from reciprocity based on the location of supplier to a model based on the origin of production of the goods or services procured. Under this rules of origin model, suppliers of commodities from Canada or from trading partners would be granted access, again subject to the relevant trade agreement
  2. Attach domestic content requirements to provincial/territorial infrastructure funding
    • in parallel, Housing, Infrastructure and Communities Canada (HICC) is leading analysis of potential options to include domestic content requirements in federally-funded infrastructure projects undertaken by provinces and territories. This approach will not impact federal procurement. Implementation options will be brought forward for further consideration at a later date
  3. Establish a broad set-aside program to reserve procurements for Canadian small businesses
    • finally, PSPC is working with ISED and other procuring departments to explore the establishment of a procurement set-aside program for Canadian small businesses. The set-aside program would apply to all federal departments and would require limiting certain procurements to Canadian small businesses, subject to trade agreement obligations and market availability in Canada. Additional approvals would be required prior to implementation
Next Steps

PSPC is working with stakeholders from other government departments on a progressive implementation of the reciprocal-by-default procurement system, beginning in June 2025. The Department is currently preparing implementation guidance for procurement officers and supporting contract clauses.

Following implementation of the reciprocal procurement system based on supplier, PSPC will seek additional approvals to transition to commodity origin, and to implement a small business set-aside program.

Partners and Stakeholders

Key partners and stakeholders include TBS, FIN, GAC, ISED and CBSA, which provide expertise on key elements of reciprocity in federal procurement and set-asides for Canadian small businesses.

Key Challenges

Significant exceptions for reciprocal procurement policies are planned and will be required to mitigate potential negative domestic consequences. The exact mechanism for applying exceptions has not been decided on and is currently under discussion. Additionally, applying rules of origin for commodities will be a new and complex function for PSPC.

A notable challenge for the set-aside program are the Canada-European Union Comprehensive Economic and Trade Agreement and the Canada-UK Trade Continuity Agreement, neither of which contain small business set-aside provisions.

Defence procurement and major projects

Defence Procurement Review
Mandate

The Defence Procurement Review was established in December 2023 to deliver concrete and actionable recommendations to improve and reform how the Government procures and sustains defence capabilities. The initiative aligns with the Government’s defence policy update, Our North, Strong and Free: A Renewed Vision for Canada’s Defence, and Budget 2024. PSPC is leading the review with key federal departments, and has regularly engaged with industry, industry associations, research and academic institutions, and allied nations.

The review is being led by a working group at the Assistant Deputy Minister level and falls under the established governance for defence procurement. Review efforts are focused on three pillars of work:

Key Activities: Defence Procurement Reform: Delivering on Canada’s Defence Policy

Recommendations were provided for minister’s consideration in late 2024. Concurrently, efforts and major initiatives are underway including:

The Defence Procurement Review continues to provide analysis and advice on changes to the defence procurement ecosystem as outlined below:

Key Challenges
National Shipbuilding Strategy
Mandate

The NSS is a long-term commitment to renew the vessel fleets of the RCN and the CCG, to create a sustainable marine sector in Canada, and to generate economic benefits for Canadians.

To date, eight large vessels and 34 small ships have been delivered, and many more are under construction across Canada. Several vessels have also undergone, and continue to undergo, repair, refit, and maintenance.

The NSS consists of three distinct pillars: large ship construction (more than 1,000 tonnes of displacement); small ship construction (less than 1,000 tonnes of displacement); and ship repair, refit and maintenance.

Key Activities

From January 2012 to February 2025, the Government signed approximately $36.35 billion in NSS contracts across the country and, of these, $1.17 billion went to small and medium businesses with less than 250 employees.

NSS contracts awarded since 2012 are estimated to contribute close to $30 billion ($2.3 billion annually) to Canada’s gross domestic product and to create or maintain approximately 20,400 jobs annually.

Large Vessels

Irving Shipbuilding Inc. has delivered five Arctic and Offshore Patrol Ships to the RCN, with the sixth launched in December 2024. For the CCG, the keel laying for the seventh ship and steel cutting for the eighth took place in July 2024. The Government, in partnership with industry, is developing the implementation contract for the River-class destroyer, which will outline the terms for constructing and delivering the first three ships. Full-rate production at Irving Shipbuilding is expected to begin in April 2025.

Seaspan’s Vancouver Shipyards has delivered three Offshore Fisheries Science Vessels to the CCG, and launched the Offshore Oceanographic Science Vessel in August 2024, with delivery set for 2025. Work continues on two Joint Support Ships for the RCN, with the first launched in December 2024 and scheduled for delivery in 2026. Design work is also progressing on one Polar Icebreaker and up to 16 Multi-Purpose Vessels for the CCG.

Chantier Davie Canada Inc. is advancing the work on one Polar Icebreaker and six Program Icebreakers for the CCG, under separate ancillary contracts. The shipyard is also designing two Transport Canada (TC) ferries, expected in 2028 and 2029.

Small vessels

Small vessels delivered under this pillar include: 18 search and rescue lifeboats for the CCG, with construction ongoing on the 19th and 20th; and two Naval Large Tugs for the RCN, with construction ongoing for the remaining two.

Repair, refit and maintenance

Work under the third pillar includes ongoing Halifax-class frigate upgrades to extend their service life until the River-class destroyers are operational. Work on providing an Interim Auxiliary Oiler Replenishment capability to the RCN continues to support at-sea supply needs until the Joint Support Ships are delivered. Additionally, in-service support is being provided for approximately 70 minor warships and auxiliary vessels, including small boats and Maritime Coastal Defence Vessels.

Partners and Stakeholders

Five key departments play a central role in achieving the Strategy’s defence and marine objectives. PSPC oversees procurement, solicitation, contracting, and vendor performance. DND, Fisheries and Oceans Canada (DFO) for the CCG, and TC define requirements, analyze costs and options, secure policy approval, and manage projects and budgets. ISED administers the Industrial and Technological Benefits Policy, ensuring economic benefits are leveraged from resulting contracts.

Canada has established strategic partnerships with Irving Shipbuilding, Seaspan, and Chantier Davie for large ship construction. Small ship projects (1,000 tonnes or less) are competitively procured among other Canadian companies. Ship repair, refit, and maintenance projects are awarded through open requests for proposals, including the three strategic shipyards.

Key Considerations

Shipbuilding is complex, and original budgets for large vessel projects were set years ago with limited data. The Government applies lessons learned to improve future budget and timeline projections, working closely with shipyards to address cost, timing, and productivity challenges.

The NSS continues to evolve, strengthened by the Icebreaker Collaboration Effort (ICE) Pact an enhanced partnership announced in July 2024 with Finland, and the US. The ICE Pact aims to accelerate polar vessel production, strengthen marine industries and enhance technical cooperation, creating new opportunities for Canadian shipyards and supply chains.

River-class Destroyer Project
Mandate

As part of the NSS, the River-class Destroyer (RCD) Project, formerly referred to as the Canadian Surface Combatant Project, will replace the RCN’s Iroquois-class destroyers and Halifax-class multi-role patrol frigates with a single class of ship capable of meeting multiple threats on both the open ocean and the highly complex coastal environment. The RCD Project is Canada’s largest and most complex shipbuilding initiative since the Second World War. This project will equip the RCN with 15 new state-of-the-art warships to bolster Canada’s naval capabilities at home and abroad, for decades to come.

The RCD project supports DND’s delivery of Canada’s Defence Policy, Our North, Strong and Free: A Renewed Vision for Canada’s Defence. It also delivers on other important NSS priorities, such as providing social and economic benefits for Canada through its Industrial and Technological Benefits Policy.

Key Activities

The RCD Project is currently in the Definition (Design) phase and is transitioning into the Implementation phase, with the start of full-rate production commencing in April 2025.

On March 4, 2025, the Implementation contract was awarded to Irving Shipbuilding Inc., defining the terms and conditions for the construction and delivery of the first batch of ships (ships 1 to 3) and the early procurement of select long-lead items for Batch 2 RCD ships. The initial Implementation contract value is $8 billion (taxes included).

As ship design progresses in parallel to the start of ship construction, Canada’s Definition Contract and Implementation Contract with Irving Shipbuilding Inc., will be open concurrently for a period of time, as will the associated subcontracts, facilitating a seamless transition of items from Definition to Implementation.

Work is underway between Canada and its industry partners to ensure appropriate delineation of roles, responsibilities, and contractual reporting structures during the period of overlap, which is expected to last until 2028.

On June 28, 2024, the Minister of National Defence and the Commander of the Royal Canadian Navy announced that the new fleet of warships will be known as River-class destroyers, and the first three ships will be named His Majesty’s Canadian Ships (HMCS) Fraser, Saint-Laurent, and Mackenzie. It also marked the start of construction activities on the Production Test Module through which the Government of Canada and Irving Shipbuilding Inc. will be able to test and streamline processes and implement lessons learned into the build process, to enable the start of full rate production in April 2025.

RCD construction will extend over approximately 25 to 30 years. Delivery of the first RCD, the HMCS Fraser, is expected in the early 2030s, with the final ship expected by 2050.

Partners and Stakeholders
Key Challenges

Global supply chain disruptions, exacerbated by geopolitical issues, could impact the availability of critical components and the overall cost of the project.

Canadian Patrol Submarine Project
Mandate

Through the Canadian Patrol Submarine Project (CPSP), the Government of Canada intends to replace its current fleet of Victoria-class Submarines with up to 12 conventionally powered, diesel-electric submarines. Parallel procurements will also provide the training, infrastructure and in-service support needed to ensure the effective and continued operation of these critical platforms for RCN.

For the CPSP, PSPC is the contracting authority and will be the lead with respect to the procurement process, including all industry engagements between the Government of Canada and the supplier community. The department will also lead the development of the procurement strategy and all procurement and management activities.

Key Activities

A Request for Information (RFI) was issued on September 16, 2024, to obtain feedback from industry on key project elements, including but not limited to: High Level Mandatory Requirements of the envisaged platform; in-service support; training; and infrastructure requirements needed to support the future fleet. Initial responses were received on November 18, 2024. The results of the RFI will allow for an Invitation to Qualify (ITQ) to be developed and posted in March 2025. It is anticipated that successful ITQ respondents will be placed on a pre-qualified suppliers list for participation in future engagement activities.

Partners and Stakeholders

PSPC works with DND, RCN, ISED, ISC, and GAC to fulfill its mandate on the submarine project. DND is the client and technical authority and manages the technical elements of the project. The RCN is responsible for defining the requirements of the future Canadian Patrol Submarine. ISED leads the implementation of the Industrial and Technological Benefits Policy. ISC provides guidance related to maximising Indigenous participation. GAC provides guidance on government-to-government relations and geopolitical strategic considerations.

Key Challenges

Canada’s key submarine capability requirements will be stealth, lethality, persistence and Arctic deployability meaning that the submarine must have extended range and endurance. Canada’s new fleet will need to provide a unique combination of these requirements to ensure that Canada can detect, track, deter and, if necessary, defeat adversaries in all three of Canada’s oceans. In view of these requirements and to avoid any gaps in Canadian submarine capabilities, Canada anticipates that a contract must be awarded no later than 2028 to allow for the delivery of the first replacement submarine no later than 2035. In the context of other large scale, complex military procurement projects, meeting these timelines may present a challenge given that past competitive procurement processes for similar major capabilities have typically taken longer than three years to complete due to the complexity of the equipment being acquired, and the need for extensive industry engagement. Additionally, there are challenges associated with the timelines for the design and completion of submarine-specific infrastructure ahead of the delivery of the first Canadian Patrol Submarine. The project will need to engage Canadian industry, including Indigenous businesses and communities, to ensure the required enablers are in-place to effectively accept on-time delivery of the new platform.

To meet demanding timelines and minimize operational risks for the RCN, it is suggested that the most effective method to ensure timely delivery of the future fleet is to acquire military-off-the-shelf submarines from a foreign supplier. Depending on the eventual platform, this may present a challenge in maximizing benefits to Canadian industry on the platform acquisition. This challenge is mitigated by the intent to perform in-service maintenance and support domestically, thereby dramatically expanding the current submarine in-service support and infrastructure enterprise in Canada.

Personnel availability, including the loss of suitably qualified and experienced personnel due to gaps in sustainment activities, as well as retention of talent in direct competition with other marine industries, represent significant challenges facing the project. The RCN will need to address this challenge by executing a strategy that serves to attract and retain talent for the management, operation and the continued support of the future fleet.

Polar Icebreaker Project
Mandate

The CCG is mandated to provide icebreaking, search and rescue, environmental response, navigation aids, and science-related services. In keeping with this mandate, and to increase Canada’s operational capability and year-round presence in the High Arctic, the Government decided in 2021 to launch construction of two Polar Class Icebreakers as part of the NSS. The first will be built at Vancouver Shipyards (VSY), while the other will be built at Chantier Davie Canada Inc. (CDCI) in Lévis, Québec.

The construction of the two Polar Icebreakers is projected to support approximately 300 jobs at both shipyards, and 2,500 jobs across the marine supply chain. Once built, these Polar Icebreakers will be the largest vessels in the CCG fleet.

Key Activities: Vancouver shipyards

The Polar Icebreaker Project at VSY (Polar-VSY) is currently in the design phase with the Construction Engineering and Long Lead Items Contracts awarded in December 2022. Work is progressing well and the project has now fully entered production design activities after completion of the functional design in early 2025. Over 90% of the Long Lead Items subcontracts have also been issued by the shipyard.

A RFP for a Build Contract, the final project phase, was issued to VSY on December 22, 2023. Following the receipt of a revised proposal on November 29, 2024 and negotiations with the contractor, on March 7, 2025, a contract of $3.15 billion, excluding taxes, was awarded to VSY for the construction of one polar icebreaker for the CCG as part of its fleet renewal plan. The ship is expected to be delivered by 2032.

Key Activities: Chantier Davie Canada Inc.

In November 2023, Chantier Davie Canada Inc. (CDCI) acquired Helsinki Shipyard Oy in Finland, now known as CDCI Nordic Yard, which has significant experience in constructing various types of icebreaking vessels. At that time, CDCI also acquired the PolarMax design, which had been previously developed at Helsinki Shipyard. Subsequently, in June 2024, CDCI submitted an unsolicited proposal to build the PolarMax design as their Polar Icebreaker for the CCG. To explore the suitability of PolarMax, an Ancillary Contract was awarded to CDCI in September 2024. CDCI proposed a hybrid domestic-international build strategy with vessel construction allocated between CDCI Nordic Yard in Helsinki and CDCI in Lévis, that would enable a delivery of the vessel in 2030.

With this strategy as a driver, negotiation of a Shipbuilding Contract was conducted in February 2025 and a contract was awarded in early March 2025.

Partners and Stakeholders
Key Challenges

Global supply chain disruptions, exacerbated by geopolitical issues, could impact the availability of critical components and the overall cost of the projects. Additionally, potential short-term challenges in workforce availability, particularly skilled trades, engineering personnel, and technical experts could impact project schedules.

Icebreaker Collaboration Effort Pact
Mandate

The Icebreaker Collaboration Effort (ICE) between Canada, the United States and Finland is a partnership that will deepen existing co-operation among these three Arctic countries by strengthening their marine industries and allowing new equipment and capabilities to be produced more quickly. As the first initiative under this trilateral arrangement, the three partners committed to a collaborative effort to design and build best-in-class Arctic and Polar icebreakers and related capabilities in each country by sharing expertise, information, and resources. Over time, it is anticipated that the three partner countries could produce Arctic and Polar icebreakers for allies and partners or, that allies and partners could join the Pact as producers. PSPC is the lead department in Canada for the ICE Pact and works in partnership with other federal departments and agencies.

Key Activities

A Memorandum of Understanding (MOU) was signed in Washington, District of Columbia (DC), on November 13, 2024, by the previous Minister of Public Services and Procurement, the former United States Department of Homeland Security Secretary of State Alejandro Mayorkas, and the Republic of Finland’s Minister of Economic Affairs, Wille Rydman.

Each country has identified a Trilateral Coordinator at the Assistant Deputy Minister level and each country has established the following four working groups, which are scoping issues for a trilateral strategy:

Canada has developed a RFI from Industry and is coordinating with the United States to post it at the same time, to the extent possible. The purpose of this RFI is to gather insights from Industry about the opportunities and challenges related to the four identified areas of work. For Canada, an engagement strategy through industry associations is being developed in tandem with the RFI and tentatively planned for spring 2025.

Partners and Stakeholders

Internal partners:

External stakeholders that will be engaged as part of Icebreaker Collaboration Effort (ICE) Pact:

Key Challenges

The ICE Pact is an example of a regional “mini-pact” that presents a novel way of building a partnership among like-minded countries to achieve shared objectives in this case, related to defence and security, jobs and growth in the shipbuilding sector, and protection of Indigenous peoples. To ensure the success of the ICE Pact, new forms of procurement, information exchange, labour mobility, and shipbuilding practices will be essential.

The immediate challenge will be to scope the objectives of the ICE Pact and identify the appropriate role for governments and industry. Each partner country brings unique expertise and needs, which should be harnessed to foster effective collaboration. On the government side, extensive trilateral engagement and collaboration will be required to align expectations as well as domestic budgetary, congressional/parliamentary and decision-making cycles.

The ICE Pact is “shipyard neutral”. Therefore, a fair open and transparent process needs to be put in place to engage with Industry through the planned RFI. It will be important to move quickly to ensure ongoing interest from Industry.

Engagement with the new Administration on ICE Pact confirms that the United States remains firmly committed to the objectives of the MOU. The United States has an aging and ineffective icebreaking fleet, which the ICE Pact aims to modernize. The Administration has stood up a new Maritime Security and Industrial Capacity directorate at the White House National Security Council to oversee the ICE Pact. The new Administration has named a National Coordinator at the Department of Homeland Security, which oversees the US Coast Guard.

Firearms Compensation Program
Mandate

In December 2023, the Government of Canada launched a competitive process to procure services for the collection, storage, validation, verification and destruction of firearms in support of a mandatory compensation program of assault-style firearms that were prohibited on May 1, 2020.

Key Activities

On May 1, 2020, the Government of Canada announced a prohibition on more than 1,500 models and variants of assault-style firearms, such as the AR-15. Since then, approximately 500 additional variants of these prohibited firearms have also been prohibited. These firearms can no longer be legally used, imported, or sold in Canada.

The 2021 Speech from the Throne and mandate letter for the Minister of Public Safety reiterated the commitment to make it mandatory for owners to dispose of their assault-style firearms, by surrendering them to the Government for the purposes of destruction or having them deactivated at the Government’s expense.

The estimated volume of these firearms held by businesses is within the range of 10,000 to 15,000, and the estimated volume held by individuals is within the range of 125,000 to 175,000.

The competitive process is comprised of two components, one RFP for the Business Phase, which includes stock from resellers such as sporting goods stores, and one subsequent RFP for the Individuals Phase, which will cover prohibited firearms owned by individuals.

On September 26, 2024, PSPC awarded a contract for up to $4.5 million (before applicable taxes), for one year and a one-year option, for the Business component of the program. The name of the company will remain confidential for security reasons.

A draft RFP for the Individuals component of the program was sent directly to three pre-qualified suppliers on November 29, 2024. The final RFP was sent to the qualified suppliers on December 17, 2024 and closed on January 24, 2025. The names of the companies will remain confidential for security reasons.

On December 5, 2024, the Government announced the addition of 324 unique makes and models to the list of prohibited firearms.

The Government will collaborate with businesses to determine how some of the prohibited firearms could be donated to Ukraine.

Partners and Stakeholders

PSPC works with Public Safety Canada (PS) and the RCMP. PS is the client and technical authority and manages the project.

Key Challenges

PS is still refining parts of the program and therefore readiness to launch the Individuals component is uncertain for the targeted May timeframe.

For parts of the population, this program is very unpopular. There are legitimate security concerns that need to be and are being addressed through the program and the procurement process.

Another key challenge is the capacity of the to-be-determined contractor to delivery results in the desired timeframe.

Assets

Federal properties

Office Portfolio Reduction Plan
Mandate

PSPC is the federal government’s administrator of real property and is responsible for approximately 6.1 million square metres of office space across Canada. As a custodian of federal real property, PSPC works to continually assess office portfolio functionality, condition, environmental impact, use, and financial performance.

Key Activities

Budget 2023 directed PSPC to present a detailed proposal to optimize the physical footprint of its office portfolio. Subsequent analysis indicated that with adoption of unassigned seating by default and based on a hybrid work model, space reduction of up to 50% of the office portfolio was possible over ten years. Budget 2024 then provided the department with $1.1 billion over ten years ($1.6 billion over 20 years) in “invest to divest” funding for the Office Portfolio Reduction Plan to pursue this 50% reduction target and achieve an associated $4.4 billion in projected savings over ten years.

To chart the way forward, PSPC has developed an Office Portfolio Reduction Plan Implementation Plan that outlines the strategic actions required to right-size the office portfolio over the next ten years. The Plan identifies key programs of work, and will be updated over time to reflect changes in client space requirements, employee growth, or any new and related government direction.

In keeping with direction provided in Budget 2024, [Redacted]. PSPC has also stood up a new service line focusing on accelerating the disposal of surplus and underutilized properties that will enable PSPC to realize Office Portfolio Reduction Plan efficiencies and savings and support the Public Lands for Homes Program.

Partners and Stakeholders

All client departments and agencies have a shared responsibility with PSPC that is established through the Accommodation Management Framework. PSPC is responsible for managing the quality, quantity, and location of office spaces to align with clients’ program requirements and ensure the best value to the Crown. Concurrently, clients must confirm space requirements and develop space optimization, consolidation, and modernization strategies in consultation with PSPC to efficiently use office space. This collaborative model aims to balance both parties' needs. Success of the Office Portfolio Reduction Plan Implementation Plan will depend upon broad cooperation across government from all parties.

SSC is a key stakeholder in office space optimization efforts, playing a crucial role in ensuring that information technology infrastructures are effectively deployed to support the office needs.

The Office of the Chief Human Resources Officer within TBS plays a pivotal role in defining the parameters of the future workplace, establishing policies and guidelines that shape how work is conducted across government departments and agencies. This includes overseeing the implementation of the hybrid work model and the Direction on Prescribed Presence in the Workplace, which aims to bring greater fairness and consistency to the application of hybrid work, ensure departments ability to perform as organizations by building stronger teams and cultures, contribute to better service delivery for Canadians, and reinforce their confidence in public service.

The Office of the Chief Information Officer within the TBS serves as the lead for the government's security policy, ensuring that security measures across all departments and agencies are robust and consistent. The Office of the Chief Information Officer 's leadership is pivotal in maintaining a secure environment that supports the government's operations and protects sensitive information.

Key Challenges

Recent developments have impacted Office Portfolio Reduction Plan projections for achievable reductions and associated savings. These include growth in the number of employees that require office accommodation, the updated Directive on Prescribed Presence in the Workplace, as well as revised direction regarding the transfer of surplus assets at a nominal value to the Canada Public Lands Bank to support the government’s housing agenda.

As a result of these developments, the Office Portfolio Reduction Plan is now projecting a reduction of approximately 33% over the ten-year period (34% if reductions already achieved in 2023 to 2024 are included), with associated operations and maintenance savings of approximately $2.45 billion over the first 10 years.

PSPC remains committed to the 50% reduction target and is exploring opportunities for further reductions. PSPC will work with other custodial departments and agencies to explore government-wide space optimization opportunities and undertake a review of the current funding model to ensure that all clients are incentivized to help seek reductions. Securing buy-in from across the public service on the effort required to meet stated reduction targets will be key.

Changes in future Government priorities (for example : amendments to the Directive on Prescribed Presence in the Workplace or the creation of new programs) may require additional future accommodation requirements that will impact PSPC ’s ability to reach stated targets.

Delays in the implementation of projects could result in loss of funding as the current funding structure prevents reprofiling. In addition, lack of funding to address modernization and deferred maintenance within existing assets may impact operational efficiency and space optimization efforts.

Key Large Projects
Mandate

PSPC is carrying out a number of key major federal property rehabilitation projects in the National Capital Region, and continuing important work towards conserving Canada’s heritage by rehabilitating and restoring places and buildings of national significance.

Key Activities: Supreme Court of Canada Building Rehabilitation

The Supreme Court of Canada Building, built at the end of the 1930s, has never been rehabilitated. All building systems are past their useful life and do not meet building code standards or client needs. The building represents a significant risk to Supreme Court of Canada operations, as well as reputational risk to Canada. The Supreme Court of Canada will be moved to the West Memorial Building in summer 2026 to allow for rehabilitation of the Supreme Court of Canada Building. The project is revising its implementation strategy by updating cost estimates to reflect current market conditions, adjusting the project scope to meet its budget, implementing a phased project delivery approach to achieve greater cost certainty, and assessing innovative delivery models to allow a suitable distribution of risks between PSPC and the contractor.

Key Activities: West Memorial Building

This project is a full rehabilitation of a vacant classified heritage building and interior fit-up to provide interim accommodations for Supreme Court of Canada Building occupants. The West Memorial Building will be modernized by summer 2026 to meet current building codes and preserve heritage elements. Work includes rehabilitation of the heritage structure (including exterior walls, windows and interior finishing, removal of contaminated soil, and strengthening and improvement of the structure), replacement of mechanical, electrical and security systems, modernization of information technology, multimedia and security systems, and improving seismic protection. Structural work is complete, while mechanical/electrical and fit-up activities are underway throughout the building.

Key Activities: Les Terrasses de la Chaudière Modernization

Les Terrasses de la Chaudière is one of the largest federal government complexes in the National Capital Area. Built between 1975 and 1978, the asset requires significant recapitalization due to the age and the condition of its building systems, and to meet federal accommodation standards.

The Les Terrasses de la Chaudière Modernization Project currently includes two major capital projects:

The Envelope Replacement Project will achieve a significant milestone with the completion of 1 Promenade du Portage tower in March 2025. The other two towers will be completed by early 2027. The GCworkplace Modernization Project is 90% completed.

Key Activities: Lester B. Pearson Rehabilitation Project

The complex was built between 1970 and 1973 and requires significant recapitalization due to the age and the condition of its building systems, and to meet federal office accommodation standards. It has been designated as a classified federal heritage building. The Lester B. Pearson Major Rehabilitation Project consists of the phased renewal of the complex (five towers) to provide cost effective, modern and efficient workspace. The first tower was completed in 2021, and the second and third towers are planned to be completed in 2026 and 2027. The fourth and fifth towers are expected to be descoped in fall 2025 to remain within current Project Authorities.

Key Activities: Portage III Asset and Workplace Renewal Project

The Place du Portage III complex was built in the mid-1970s and is designated as a "recognized" heritage asset. The complex is at the end of its useful life and requires significant recapitalization to replace essential base building systems, upgrade the structural components of the building, comply with building codes, and modernize the workplace to meet current related standards. The Asset and Workplace Renewal Project consists of the phased renewal and fit-up of the nine tower complex. It is a key contributor towards achievement of government priorities in sustainability (environmental, social and financial), as well as accessibility and inclusivity. The project is currently in its construction phase in seven of the nine towers, with the two remaining towers currently being leveraged as swing space. Planned project completion in 2029.

Partners and Stakeholders

Stakeholders include multiple government departments and organizations currently occupying the various assets and providing advice on implementation of the projects, as well as key institutions of Canada’s democratic political system.

Government departments and organizations: the National Capital Commission, the Canadian Radio-television and Telecommunications Commission, ISC, Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC), SSC, CRA, GAC, and Parks Canada’s Federal Heritage Review Office.

Democratic institutions: the Supreme Court of Canada, the House of Commons, and the Senate.

Local and municipal partners also play a key role in advancing projects and enabling their completion while adapting their services, including OC Transpo, the Société des transports de l’Outaouais, the City of Gatineau and the City of Ottawa.

Key Challenges

Key challenges common to most major large projects in the NCR include managing cost overrun and reduced value of available funding, managing delays and ensuring timely delivery of projects and their components, including through descoping of projects, and preventing building system failures, which could result in health and safety concerns and interruption of operations.

Public Lands for Homes Plan
Mandate

Budget 2024 announced the new Public Lands for Homes Plan, which aims to unlock 250,000 housing units by 2031 by leveraging public lands. Budget 2024 called for a review of federal properties to identify potential sites that would be suitable for housing and list them on the new Canada Public Land Bank. Budget 2024 also provided $500 million dollars to PSPC to establish a Public Lands Acquisition Fund, which would allow the department to purchase land from other orders of government.

The Minister of Public Services and Procurement holds the lead role in advancing the Public Lands for Homes Plan, as outlined in Budget 2024. This includes overall leadership and coordination among partners (other government departments, custodians, and crown corporations). The Minister is also responsible for bringing sites to market in partnership with the Canada Lands Company and accelerating the disposal process. The Minister for Housing, Infrastructure and Communities plays a supporting role by ensuring integration with broader housing policy and developing a flexible outcomes framework.

Budget 2024 provided PSPC with $53 million from 2024 to 2025 and 2029 to 2030 to establish a Centre of Expertise to support this work.

Key Activities

PSPC launched the Canada Public Land Bank on August 25, 2024, with an initial 56 properties, representing 25,000 potential housing units. The Bank now has 90 properties listed, representing approximately 42,000 housing units (as of February 20, 2025).

To support the Canada Public Land Bank, the Minister of Public Services and Procurement wrote to departmental custodians seeking a list of their underutilized properties and to Crown Corporations seeking a list of their surplus and underutilized properties to be assessed for housing potential. Proposed properties are currently being assessed for housing suitability, and these will be added to the Canada Public Land Bank.

Partners and Stakeholders

The development of the Public Lands for Homes Plan requires fair, open and transparent collaboration with federal, provincial, territorial, and municipal governments, Indigenous communities, the non-market housing sector, and industry organizations. Given the highly localized nature of housing issues, stakeholders and partners vary significantly from coast to coast, reflecting the unique needs of communities and capacity of residential housing markets. Ongoing engagement efforts are focused on gathering insights, addressing challenges, and aligning efforts to ensure program success.

Key partners and stakeholders of the Public Lands for Homes Plan include:

Key Challenges

The average timeline for completing a federal disposal process from beginning to end is nine years. Speed is a key component of successful program implementation and work is currently being done to significantly accelerate the disposal process to achieve 2031 targets.

Close collaboration with other orders of government is also required to meet the 2031 target. Work is ongoing to develop simple program parameters that align with housing programs of other levels of government.

Ensuring progress with minimal new federal expenditures is a key challenge. Land typically accounts for 10% to 15% of the total costs of housing development projects. Efforts are underway to ensure alignment and synchrony with other housing programs (federal, provincial, territorial and municipal) to maximize resources and drive cost-effective solutions.

Parliamentary Precinct

Parliamentary Precinct Long Term Vision and Plan
Mandate

PSPC is the custodian and the lead for planning, redevelopment, and operations of the Parliamentary Precinct. The redevelopment program is underway and is guided by a Long Term Vision and Plan (LTVP).

The Parliamentary Precinct campus comprises 40 Crown-owned buildings-29 of which have a federal heritage designation. It includes Parliament Hill, as well as the three city blocks facing the Hill between Elgin and Bank streets.

The LTVP is executed in rolling five-year programs of work focused on modernizing buildings, while preserving their heritage character. Approximately $5.4 billion has been invested in the Precinct, which has created around 80,000 jobs (person-years of employment) to date.

Image: Long Term Vision and Plan—Past, present and future
Map showing projects that have been completed, are in progress, and are planned for the future. It also depicts where occupants are/will go when the building is being rehabilitated.
 
Long description

This map is titled the Long Term Vision and Plan: Past, Present and Future. It shows the Parliamentary Precinct and the sequence of projects being delivered by the Government of Canada to rehabilitate and modernize the Parliamentary Precinct. From north to south, the map shows buildings on Parliament Hill and in downtown Ottawa.

The map also shows a number of completed projects on Parliament Hill and in downtown Ottawa. Blue arrows are used to show the relocation of parliamentary activities from one building to another. Firstly, a list of completed projects which are denoted by the colour blue, in order from west to east and from north to south:

  • the Library of Parliament main branch was relocated to Block 2
  • West Block functions were relocated to Block 2, and a site adjacent to the Fairmont Chateau Laurier and north of Wellington Street, and a third location offsite for Food Production and Kitchen
  • functions in Block 3 were relocated to buildings at 181 Queen Street, 155 Queen Street, 131 Queen Street, and an offsite location for the Curatorial Services and Trade Shops
  • a part of the Block 2 project, the southwest segment, was relocated in part to 131 Queen Street and to the C.D. Howe Building
  • some functions at 131 Queen Street were relocated to the Sun Life Financial Centre

The map also shows a number of current projects on Parliament Hill and in downtown Ottawa. Both red and blue arrows are used to show the relocation of parliamentary activities from one building to another. Secondly, a list of current projects which are denoted by the colour light yellow, in order from west to east and from north to south:

  • the Centre Block functions and chambers were relocated to a site adjacent to the Fairmont Chateau Laurier, Block 3, West Block, 40 Elgin Street, and the Senate of Canada Building
  • Block 2 is a current project with future relocation being planned to 40 Elgin Street
  • other current projects that are underway are 100 Sparks Street, 30 Metcalfe Street, and 40 Elgin Street; however, these projects have not undergone any relocation activities

The map also shows a number of future projects on Parliament Hill and in downtown Ottawa. Red arrows are used to show the relocation of parliamentary activities from one building to another. Thirdly, a list of future projects which are denoted by the colour red, in order from west to east and from north to south:

  • the Confederation Building functions planned for future relocation to Block 2
  • the East Block functions are planned for future relocation to Block 2
  • the Block 1 functions planned for future relocation to the Block 1 southwest side of the building and to 100 Sparks Street
  • the middle segment of Block 3 is denoted by the colour red meaning that this part of the building was designated as a future project; however, this project has not undergone any relocation activities
 
Key Activities

The following major projects are currently in planning and execution in support of the LTVP:

Partners and Stakeholders

Parliamentary Partners:

Other key partners include:

International Network of Parliamentary Properties:

PSPC participates in a network of over 20 countries to gain insight on international parliamentary modernization programs and heritage preservation best practices.

Key Challenges

Governance for the Precinct and the implementation of the LTVP is complex, with accountability split between the Minister (responsible for budget and delivery) and Parliament (responsible for determining its requirements).

Obtaining timely decisions to maintain program momentum is a significant risk to LTVP projects. To improve timely decision making, the department coordinates with the Parliamentary Administrations to plan and prioritize key decisions. In addition, the department submits updates to the Speakers of the Senate and House of Commons on emerging risks and key decisions.

While the department has taken steps to support a made-in-Canada approach to projects in the Precinct, the introduction of US tariffs could have a significant impact on the implementation of the LTVP. The department will closely monitor construction costs to account for potential tariffs for all major projects ongoing within the Precinct.

Future of Wellington Street
Mandate

Wellington Street, a City of Ottawa-owned roadway, runs through the Parliamentary Precinct, which presents challenges to securing and managing risk to Canada’s Parliament. PSPC is leading discussions with the City on a possible federal acquisition of the street.

Key Activities

In 2022, Wellington Street was the site of illegal protests. In response, the city temporarily closed the street to vehicular traffic and directed its staff to engage the federal government on acquiring it. A public inquiry and two parliamentary studies were also launched, and recommended, amongst other actions, that the street be transferred to the federal government.

Partners and Stakeholders

Negotiations with the City have been underway since 2023 to acquire Wellington Street between Elgin and Bank Streets, supported by several due diligence activities including a land survey, an independent appraisal, and a study to assess the impact and costs of reinstating vehicle restrictions.

To support the protection of Parliamentarians and Visitors to Parliament Hill, departmental officials continue to pursue discussions with the City to formalize an agreement.

Key Challenges

The threat and risk environment in the Precinct is evolving. Within a decade, the office of the Prime Minister and 50% of all parliamentary offices will be permanently located south of Wellington. Several global capitals have, or are moving to, restrict vehicle traffic around their legislatures in a way enhances security while creating more vibrant public spaces. The objective in Canada is to redevelop Wellington Street in a similar manner.

Restricting private vehicles on Wellington will help to balance security and openness, and create opportunities to realize economies in projects underway in the Parliamentary Precinct in a tight fiscal environment, by creating building-setbacks and reducing building hardening.

National Capital Region Mobility

Eastern Bridge in the National Capital Region
Mandate

PSPC is leading a project to construct a new bridge in the east of the NCR, in collaboration with the NCC, as an integrated project team. In June 2024, the Government decided to advance planning of the design and construction of a multimodal bridge along the Montée Paiement and Aviation Parkway Corridor, connecting the two major highways in Ottawa and Gatineau, to improve transportation connectivity in the NCR.

The 2024 Fall Economic Statement announced the Government's commitment to building an Eastern Bridge over the Ottawa River. The Government is now proceeding with pre-planning activities, including advancing the impact assessment, developing preliminary designs, and performing public and Indigenous consultations.

Key Activities

A series of environmental studies for a sixth crossing in the NCR were completed between 2000 and 2013. The studies explored ten different corridors and two tunnel corridors. Ultimately a preferred corridor was selected but at that point work stopped due to a lack of funding and public concerns with the proposed project. From 2019 to 2020, studies were refreshed and the initial top three corridors (Montée Paiement-Aviation Parkway (previously known as Kettle Island), Lower Duck Island and Gatineau Airport/McLaurin Bay) were costed. In summer 2024, the Government decided to proceed with the project based on the Montée Paiement-Aviation Parkway corridor.

A municipalities-led origin-destination survey to study changing traffic patterns took place in fall 2022 and a truck and commercial goods survey was conducted in summer 2023. The overarching strategy to further improve transportation in the NCR will be reflected in the NCC’s revised Long-Term Integrated Interprovincial Crossing Plan.

As this is a designated project under the Impact Assessment Act, it will follow the Impact Assessment Agency of Canada’s regulatory requirements and guidance. Operational meetings with the Agency commenced in summer 2024. Ecological studies will start in spring 2025 and will continue until 2027. An initial assessment will be completed and submitted in early 2026.

The procurement of a Technical Advisor is crucial in progressing the impact assessment and design processes. The contract will be awarded under departmental authorities for professional services. The Request for Proposals was released on December 31, 2024. The contract is expected to be awarded in March 2025.

Partners and Stakeholders
Key Challenges

Kettle Island is a privately owned “nature reserve” under the Québec Natural Heritage Conservation Act. The design will need to avoid or reduce the potential footprint of a bridge on the island.

Engagement and community input will be key for a successful project given that previous attempts at a similar project in the same location failed due to vocal opposition. The Impact Assessment process is the mechanism for collaboration on the public’s and Indigenous communities’ key areas of concern.

As the corridor is using existing roadways and is located close to housing, noise mitigations during construction and operations is a concern of residents. The Impact Assessment process will work collaboratively with stakeholders to identify and develop mitigation strategies for residents’ concerns.

Alexandra Bridge Replacement Project
Mandate

As part of a broader effort to improve interprovincial transportation in the NCR, the Government of Canada mandated the replacement of the Alexandra Bridge in 2019. The Alexandra Bridge is more than 120 years old and is at the end of its life. The demolition and construction period for the new bridge are anticipated to occur between 2028 and 2032.

The project is led by an Integrated Project Team, comprised of multidisciplinary PSPC and NCC resources, and consultants.

Key Activities

In June 2021, the NCC’s Board of Directors approved the planning and design principles for the replacement. These principles were developed by PSPC and the NCC with input from the public and Indigenous partners.

In May 2023, the project awarded a contract for a Technical Advisor. Specific activities completed to date under this contract include developing conceptual designs for public consultation, conducting environmental and archeological studies to meet commitments made to the Impact Assessment Agency of Canada, and providing technical expertise to support the procurement and delivery of the project.

In October 2024, the NCC led public consultations on conceptual design options. In parallel, an independent panel of experts assisted the integrated project team in developing a robust process to recommend a preferred concept design. They also provided their insights on the three conceptual design options. The NCC’s Board of Directors approved the preferred concept design on January 23, 2025.

In October 2024, PSPC also launched the progressive design build procurement process with the release of a Request for Qualifications (RFQ), which closed January 24, 2025. A subsequent Request for Proposals is expected to be released to qualified RFQ respondents in May 2025. 

Partners and Stakeholders
Key Challenges

While the Alexandra Bridge accommodates only roughly 9% of the vehicular traffic, the interprovincial crossings and associated road networks are already beyond capacity at peak hours. The period of demolition and construction of the replacement bridge is expected to take up to four years and managing traffic impacts will be a significant challenge.

Residual public opposition to the Alexandra Bridge replacement project may persist, including objection to the preferred concept design. The NCC, together with the department, continue to advance a robust communications and engagement strategy to articulate the rationale and benefits of the project, and the decision regarding the preferred concept design.

LaSalle Causeway
Mandate

The LaSalle Causeway is a vital infrastructure link connecting downtown Kingston, Ontario, to the Pittsburgh district at the mouth of the Cataraqui River. It is part of Highway 2 and consists of five interconnected structures: three bridges (West Bridge, East Bridge, and the new modular bridge) and two wharfs (West Wharf and East Wharf). The Bascule Bridge, which previously occupied the central channel, was damaged during construction in March 2024 and subsequently demolished in June 2024. A modular bridge was installed in October 2024 to accommodate vehicles, pedestrians, and cyclists to ensure continued connectivity and safety for both vehicular and marine traffic.

Key Activities

The LaSalle Causeway provides marine access to the Rideau Canal, a United Nations Educational, Scientific and Cultural Organization (UNESCO) World Heritage Site, and the inner harbour of Kingston. The main navigation channel, under the former Bascule Bridge, opened on a fixed schedule for larger vessels, while a secondary channel under the East Bridge has always been available for smaller vessels.

The causeway is owned and maintained by PSPC , which is responsible for the ongoing maintenance, repair, and any necessary replacements of the infrastructure. In 2025, PSPC plans to temporarily open the main marine navigation channel by removing the modular bridge once every two weeks starting in mid April, increasing to once a week from June to August, and then returning to bi-weekly openings until mid-November.

Partners and Stakeholders

The LaSalle Causeway project involves several stakeholders. The City of Kingston assists with traffic management and public communication. The marine community, including boaters using the Rideau Canal, relies on the causeway for navigation or access to Kingston’s Inner Harbour for mooring, services and repairs. Local residents and commuters depend on it for daily transportation. Contractors, such as Priestly Demolition Inc., are involved in activities relating to the removal and reinstallation of the modular bridge. TC oversees navigation approvals under the Canadian Navigable Waters Act, and Parks Canada is involved due to the Rideau Canal's status as a UNESCO World Heritage Site.

Key Challenges

The LaSalle Causeway faces several key challenges. Firstly, balancing the needs of local residents and the marine community is a delicate task, as the LaSalle Causeway serves as a crucial link for both land and water traffic. Secondly, the complexity and challenges associated with the logistics of the removal and reinstallation of the modular bridge are not only time-consuming but also disruptive to land traffic and marine access. Finally, noting the level of service provided by the modular bridge will not satisfy all users, there is a need to implement a longer-term solution, which could take the form of either a fixed or moveable bridge, and address additional deficiencies with the east and west bridge structures. At this time, there is no timeline associated with the replacement of the bridge.

Image: LaSalle Causeway
Aerial map view of the city of Kingston, showing the location of the LaSalle Causeway.
 
Long description

Aerial map view of the city of Kingston, showing the location of the LaSalle Causeway. Marked with text are the key areas of Downtown Kingston, the Cataraqui River, the entrance to the Rideau Canal, the Canadian Forces Base Kingston, Fort Henry National Historic Site, the Royal Military College of Canada, and the St. Lawrence River. It also has the LaSalle Causeway highlighted to show where the modular bridge is installed.

 

Payments And Accounting

Pay Administration: Integrated Enterprise Human Resources and Pay Strategy

Mandate

Under Section 12 of the Department of Public Works and Government Services Act and Order in Council P.C. 2011-1550, the Minister of Public Services and Procurement is mandated to administer the disbursement of pay to employees of the federal public administration.

In 2021, the Minister of Public Services and Procurement’s mandate letter required the Minister to “work with the President of the Treasury Board to resolve outstanding Phoenix Pay System issues for public servants once and for all, while advancing work through SSC on the Next Generation Pay and HR System. In May 2023, an Associate Deputy Minister for Enterprise Pay Coordination at PSPC was appointed to lead and implement an enterprise integrated strategy on HR and pay.

Key Activities

The Integrated Enterprise HR and Pay Strategy focuses equally on improving ongoing pay administration operations and service delivery with the current pay system (Phoenix), and advancing the Next Generation HR and Pay Initiative.

Operations Component

The Operations Component (Run) focuses on the continued delivery of legally mandated pay and benefits administration and the delivery of compensation services while also improving current operations and addressing outstanding transactions.

Key activities include the administration of pay and benefits, financial accounting and remittances to 150 organizations (for example tax agencies, insurance companies, and unions), management of the inventory of pay transactions, support to public servants, system support, the Artificial intelligence (AI) based Virtual Assistant for compensation processing, and measures to improve HR and pay practices and data quality in partnership with TBS’s Office of the Chief Human Resources Officer.

Transformation Component

The main objectives of this component are to replace the Phoenix pay system, Public Service Commission Public Service Resourcing System (GCJobs), and the majority of the 30 HR systems in use across government with an integrated HR and pay software as a service (SaaS) solution from Dayforce, as well as the development of an HR and Pay Enterprise Central Data Hub.

The Final Findings Report for the Dayforce solution concluded that the solution is a technically viable option to replace the current pay system (Phoenix) and HR systems suite. Budget 2024 granted funding for PSPC to complete further design, testing, validation, and costing to confirm feasibility of an enterprise-wide deployment of the Dayforce Human Capital Management solution. The Human Capital Management Feasibility Project is scheduled to be completed by the end of March 2025.

Partners and Stakeholders
Key Challenges

Trust Deficit: As general pay issues continue, a lack of employee trust remains in the Government’s ability to manage large-scale digital transformation initiatives. This risk is being mitigated in part through the Transparency by Design initiative, which increases stakeholder engagement and communicates progress on Transformation activities.

Pay Stabilization Commitment: PSPC committed to have no cases over one year old in the Pay Centre backlog by March 31, 2026. Currently, there are approximately 197,000 cases in the backlog (as of January 2025) and there is a risk that the commitment will not be met by the target date and create delay for transformation.

The Human Capital Management Portfolio will continue to administer pay operations in the current Phoenix pay system while managing intake and reducing the backlog. To do so, it will leverage the AI-based virtual assistant to increase productivity and process transactions in bulk and will also implement the final United Actions for Pay measures.

The Human Capital Management Portfolio is continuing to assess the feasibility of an enterprise-wide implementation of Dayforce Human Capital Management solution to demonstrate a high degree of confidence in the final investment and implementation recommendation. This work is scheduled to be completed by March 31, 2025.

Receiver General

Public Accounts of Canada
Mandate

The Public Accounts of Canada is the annual financial report to Canadians covering the fiscal year of the Government, ending March 31. The Receiver General (the Minister), as the Government’s accountant, is responsible for preparing and publishing the report. Sections 63, 64, and 65 of the Financial Administration Act provide the Receiver General with the authority to maintain accounts, prepare the Public Accounts report and request financial information from departments and agencies.

Key Activities

The Public Accounts report is prepared based on financial transactions that are maintained by departments and agencies in accordance with direction from the Receiver General. It provides Parliament with information explaining the nature and extent of financial affairs and resources for which the government is responsible. Parliament uses the Public Accounts to ensure that appropriated funding is spent according to the amounts and the purpose authorized in the Estimates.

The report is produced and published in three volumes:

Partners and Stakeholders

The Receiver General for Canada, the President of the Treasury Board, and the Minister of Finance share responsibility for the preparation of the Public Accounts. The Deputy Receiver General, the Secretary of Treasury Board, the Deputy Minister of Finance, and the Comptroller General co-sign the Consolidated Financial Statements on behalf of the Government of Canada.

The Receiver General has the responsibility to establish and maintain an effective system of internal control over the reporting of financial data. This system is essential for the preparation of consolidated financial statements that are free from material misstatements and that are prepared based on published accounting policies and standards.

The Receiver General is also accountable for making available all original accounting records and other relevant information to support the audits carried out by the Office of the Auditor General.

The Auditor General of Canada is responsible for the audit of the consolidated financial statements and for providing an independent audit opinion to the House of Commons. To date, the Auditor General has provided 26 consecutive years of unmodified opinions on the statements.

Key Challenges

No challenges are currently anticipated with the production cycle of Public Accounts 2025. The Office of the Auditor General has not started their annual audit of the Consolidated Financial Statements of the Government of Canada. The department is currently operating under these timelines:

Receiver General Modernization
Mandate

The Receiver General for Canada is the central treasurer and accountant of the federal government. Since 1762, its mandate has been to safeguard the integrity of the Accounts of Canada and of the Consolidated Revenue Fund (in other words, all public money). It is responsible for more than $3.55 trillion in cash flow and 405 million payments to Canadians annually, which are primarily for social benefits. The Receiver General is also responsible for the preparation of the Public Accounts of Canada.

Key Activities

The Government of Canada is operating on aging, outdated legacy systems at increasing risk of failure. The Receiver General must modernize its systems and processes to ensure the long-term stability of its critical functions as it operates in a zero fail environment due to its potential impact to the Canadian public. Modernization is driven by the need for enhanced payment offerings, improved fraud detection and cyber defence, further automation of processes, real-time reporting, and predictive analytics to meet the evolving accounting and payment ecosystems’ emerging technologies.

The Receiver General Modernization initiative is a strategic, multi-year project aimed at enhancing Canada’s payment and accounting systems. The initiative was included in Budget 2024. Modernization is expected to take 7 to 10 years. The first step is to develop a technology-agnostic target operating model and roadmap for a gradual, low-risk transformation. The projects are meant to be executed using a building block approach to allow for re-alignment if required for the duration of the modernization and avoid disruption of day-to-day operations.

A competitive contract was awarded to Ernst & Young in summer 2024 to provide independent, third party expertise with experience in large-scale payments and accounting transformation to assist in developing the preliminary target operating model, the target operating model and transformational roadmap. Receiver General employees will work hand in hand with the external experts to ensure that business needs are well understood, to build internal capacity and to ensure the delivery of the best outcomes for Canadians.

Partners and Stakeholders

The Receiver General function supports every department and agency (for example, to deliver programs such as Employment Insurance, Canada Pension Plan, Old Age Security), as well as every Canadian and Canadian business receiving payments from the Government of Canada.

There are many interfaces and interdependencies with Canadian financial institutions working with the Receiver General to offer services to Canadian individuals and businesses receiving money from and paying money to the federal government.

In the context of the Receiver General Modernization initiative, stakeholder engagement, modernization trend analysis and current state assessment has already begun to determine the foundation of the preliminary target operating model, scheduled for completion in spring 2025.

Key Challenges

Government-Wide Support

Translation Bureau

Mandate

Established in 1934, the Translation Bureau supports the Government of Canada in its efforts to communicate with and serve Canadians in both official languages, Indigenous and foreign languages, and sign languages. Its mandate is to provide quality linguistic services to Parliament as well as federal departments and agencies. The Bureau has approximately 1,300 employees in Canada, most of whom are language professionals.

Key activities

The Translation Bureau collaborates with and acts for all departments, boards, agencies and commissions established by Act of Parliament or appointed by order of the Governor in Council, as well as for both Houses of Parliament in all matters relating to the translation and revision of their documents (including reports, debates, bills and Acts), conference interpretation, sign language interpretation, and terminology. It also offers a range of services such as resources of the Language Portal of Canada, language development workshops, after-hours emergency service, document processing of protected and classified documents and TERMIUM Plus®. In 2023 to 2024, the Translation Bureau generated $209 million in revenues, provided 47,000 hours of interpretation and translated approximately 370 million words. It is the 16th largest language service provider in the world.

Following a Budget 2024 directive, Translation Bureau is developing a plan to promote responsible use of AI to meet the evolving language needs of the federal public service.

Partners and stakeholders

The Translation Bureau works with various stakeholders in the language industry, including academia, professional associations and the language industry to monitor industry developments and trends, share best practices, conduct studies, establish partnership agreements and more. The goal is to remain a language centre of excellence in Canada and the world.

Key challenges
Funding

The Translation Bureau operates on a cost-recovery basis ($181.4 million in 2023 to 2024) and its services are optional for federal departments and agencies. In 2023 to 2024, demand from government departments for “traditional” translation services dropped by around 17%. Translation Bureau clients are increasingly turning to machine translation services by using free internet tools, or by investing in their own AI-based translation tools. The Translation Bureau is completely rethinking its funding model and service offering now that AI is part of the equation.

In terms of services to Parliament, the Translation Bureau holds a special purpose allotment with base funding of $40.1 million and, as part of Budget 2024, it was granted $31.9 million over five years (including $9 million in 2024 to 2025). This budget envelope is insufficient to respond to the increase in translation or interpretation requests associated with work from the House (for example, motions for the production of papers).

Capacity

The worldwide shortage of conference interpreters and the growing need for interpretation to support a hybrid government are factors affecting the Translation Bureau’s capacity to increase interpretation services beyond existing levels. In addition, due to the pandemic in 2020 and sound related issues during telephone and virtual meetings, the Translation Bureau has reduced interpretation hours from six hours to four hours per assignment.

The Translation Bureau has implemented a number of proactive and ongoing measures to increase its capacity:

Health and safety

The health and safety of interpreters constitutes a priority for the Translation Bureau. Recent measures have reduced by 70% the number of incidents in 2024 compared to 2022. Drawing on new technologies and research by experts in audiology and acoustics, the Translation Bureau continues to improve interpreter protection measures, incident prevention, as well as management and monitoring protocols to follow up on instruction issued by the Government’s Labor Program.

Ethical Procurement

Supplier Integrity and Compliance
Mandate

The Office of Supplier Integrity and Compliance (OSIC) is part of a broader framework of tools at the Government’s disposal to improve its ability to respond to emerging risks and protect the integrity of the federal procurement and real property systems.

OSIC administers the Government’s suspension and debarment program for procurement and real property transactions, which is designed to mitigate the risk of conducting business with suppliers of concern by excluding them from being awarded contracts.

The authority to establish the Office of Supplier Integrity and Compliance is derived from paragraph 7(1)(a) of the Department of Public Works and Government Services Act and is administered independently of procurement authorities.

Key Activities: Administering the Ineligibility and Suspension Policy

OSIC administers Canada’s suspension and debarment program in accordance with the Ineligibility and Suspension Policy, which sets out when and how a supplier may be declared ineligible or suspended from being awarded federal contracts or real property agreements, or required to enter into an administrative agreement to continue doing business with Canada.

Decision-making under the Policy has been delegated from the Minister to the Registrar of Ineligibility and Suspension (the Registrar), an Assistant Deputy Minister level position.

With the launch of OSIC, an updated Policy came into effect in May 2024 and enables the Government to respond to a broader range of misconduct and unethical behaviour by suppliers, such as cases where:

Currently, one supplier is provisionally suspended, two are suspended, six suppliers are ineligible, and three suppliers have administrative agreements.

Key Activities: Developing and deploying data analytics

OSIC is developing and deploying increased data analytics to detect fraudulent schemes, such as overbilling. As of February 2025, PSPC has referred seven cases of overbilling to the RCMP. PSPC is also actively pursuing the recovery of illegitimate amounts billed to the Government of Canada and the department has asked companies involved to repay those amounts. This work continues to unfold, beginning with the first cases that were identified in March 2024, and steady progress is being made.

Partners and Stakeholders

The Policy applies to all departments and agencies identified in Schedules I, I.1 and II of the Financial Administration Act and can also be voluntarily adopted by other federal entities. OSIC administers the Policy on behalf of 86 departments and agencies and three Crown corporations and is continuing efforts to expand its application.OSIC draws on a number of sources to identify supplier misconduct, including open source research, data analytics, and tips from the Federal Contracting Fraud Tip Line. OSIC is also able to receive referrals from competent authorities, such as other departments and agencies. When such referrals are made, OSIC will assess the case of supplier misconduct to determine whether action under the Policy is required. If elements of criminality are identified, departments and agencies (including PSPC) are required to refer the matter to law enforcement. OSIC engages many stakeholders to share information and best practices, including provincial and territorial governments; the supplier community, industry associations and chambers of commerce; civil society organizations; and procurement and debarment professionals; and foreign governments and international bodies (for example, the World Bank).

Key Challenges

The launch of OSIC is a shift from the former debarment and suspension approach. The Registrar has reached out to federal partners to raise awareness of the new authorities and to encourage referrals of founded supplier misconduct. OSIC will continue engaging partners to ensure the expanded scope of the revised Policy is well understood and applied consistently.

PSPC has expanded authorities to address a wider array of misconduct and to respond with a broader set of measures. The department will continue assessing how new authorities can apply to specific situations requiring risk mitigation.

Wrongdoing continues to pose a significant risk to public procurement and real property transactions. Unethical suppliers are increasingly sophisticated and their tactics continue to change. To address these challenges, OSIC will refine internal processes, adopt additional data analytic capabilities and explore new and innovative approaches to ensure PSPC has the right tools in place to prevent, detect and respond to situations of supplier wrongdoing.

Industrial Security

Contract Security Program
Mandate

PSPC administers the Contract Security Program (CSP), as outlined in the Department of Public Works and Government Services Act. The CSP safeguards classified and protected government information entrusted to industry, both domestically and through international partnerships. As Canada’s Designated Security Authority for NATO and allied countries, CSP is also responsible for setting and enforcing industrial security standards and ensuring secure access to global networks and supply chains, particularly in the defence and military sectors.

CSP services are mandatory for PSPC issued contracts with security provisions. For contracts with security provisions issued by other federal departments, CSP is a voluntary service. The CSP also applies when bidders need provisional security screening to access sensitive information, when contracts with security requirements are awarded to domestic or foreign suppliers, or when Canadian industry is awarded foreign contracts with security provisions. 

Key Activities

To support Canada’s security posture and ensure the integrity of government procurement, CSP activities include:

CSP supports approximately 90% of Government of Canada contracts with security provisions, as well as contracts with NATO and allied governments, to ensure the protection of sensitive information and assets. Over the past five years, CSP screened over 14,000 companies and 500,000 individuals, processed 9,000 site visit clearance requests, and verified 1,300 security clearances annually with foreign governments. The program currently maintains bilateral security agreements with 26 countries and international organizations, enabling secure collaboration on defense and industrial security.

Partners and Stakeholders

Government departments: CSP partners with Canada’s security and intelligence agencies (in other words RCMP, the Canadian Security Intelligence Service, the Communications Security Establishment, CBSA, IRCC, and PCO) to facilitate the exchange of critical information to assess the reliability and loyalty of individuals, the security posture of industry organizations, and other key activities.

Industry: CSP works closely with industry, such as defence firms, Indigenous businesses, businesses led by underrepresented groups, and industry groups (e.g. the Defence Indigenous Advisory Group), to provide specialized advice and guidance on contract security and ensure the protection of sensitive foreign and domestic government information and assets.

Foreign Partners: CSP is Canada’s Designated Security Authority for NATO and Canada’s national authority for industrial security. In these roles, CSP collaborates with foreign partners and negotiates bilateral security agreements with foreign countries and international organizations for example, the Five Eyes, the European Union, and the European Space Agency). CSP represents Canada in international industrial security forums, including the Multinational Industrial Security Working Group.

Key Challenges

CSP faces a range of challenges that strain its ability to effectively and efficiently deliver its services and can impact government clients and industry:

A difficult threat environment: Intensifying threats (for example, foreign interference, espionage, insider threats) and a growing number of threat vectors (for example, cyber, research), combined with the increasing sophistication and speed of state and non-state actors, make safeguarding information and assets held by Canadian industry and of critical value to Canada (and its allies) increasingly difficult. At the same time, the Program must navigate an increasingly volatile geopolitical landscape and growing demands for reciprocity by allies.

Industry relations: A growing number of CSP applicants have personal histories that result in “complex” files (in other words, out-of-country verifications and foreign ownership assessments) requiring extensive international coordination and often lengthening screening timelines. Industry has voiced concerns requested greater transparency on status, timelines, and criteria for clearance decisions. Smaller and underrepresented firms also require increased support to navigate unfamiliar security processes.

Insufficient integration with the security and intelligence community: Without formal integration (in other words, inclusion in the Security of Canada Information Disclosure Act), timely access to accurate information is limited and the ability to share national security information and intelligence with relevant government organizations is constrained.

Policy gaps: As CSP is not mandatory for all government contracts with security requirements, there is an outstanding potential for the improper and inconsistent identification of security requirements and security standardization.

On an operational level, there are challenges posed by legacy systems and data and information management. Legacy systems pose security, business continuity, and privacy risks, and are vulnerable to cyber and insider threats. Current systems are outdated, requiring manual entry and limiting the program’s ability to secure, access, track, capture and manipulate the breadth of data in its possession.

Communications

Announcement opportunities: First 60 Days

March 2025
Update to Canada Public Land Bank: Week of March 17

PSPC will update the Canada Public Land Bank for the fourth time since its initial launch in August 2024. This will provide the Minister with an opportunity to highlight new properties in the land bank and provide an update on progress.

April 2025
Future Human Resources to Pay System for the Government of Canada

PSPC will announce next steps for the implementation of a new HR-to-Pay system for the Government of Canada, including a final decision on whether it will proceed with the Dayforce solution.

May 2025
Canadian Association of Defence and Security Industries 2025: May 28 and 29

At this annual event organized by the Canadian Association of Defence and Security Industries, the Minister has the opportunity to participate in the morning keynote, make announcements related to defence procurement spending, and tour the tradeshow floor to observe leading-edge technologies, products and services for land-based, naval, aerospace and joint forces military units.

Spring 2025
Delivery of the offshore oceanographic science vessel

The offshore oceanographic science vessel (OOSV), named the Canadian Coast Guard Ship (CCGS) Naalak Nappaaluk, is undergoing final outfitting and integration work at Seaspan's Vancouver Shipyards and is expected to begin harbour and sea trials soon. The Minister could participate in its delivery to the CCG in spring 2025. The OOSV will become the largest dedicated science vessel in the CCG fleet.

Top Media Issues

Doing business with United States suppliers
Professional Services Contracting
Indigenous Procurement
Federal Office Space
Federal Lands for Homes
Defence and Marine Procurement

Regional Issues

Lac-Mégantic

Mandate

In summer 2019, the Government of Canada announced the Lac-Mégantic Rail Bypass Project. To carry out the construction of this bypass, the Government had to acquire 124 parcels of land from 44 property owners in the municipalities of Lac-Mégantic, Frontenac and Nantes.

TC mandated PSPC to acquire the parcels and to manage the technical contracts involved in the acquisition process. PSPC’s mandate officially ended when it took possession of the parcels on August 1, 2023.

Key Activities

PSPC met with property owners to explain the steps in the acquisition process, surveying and appraising the parcels, and negotiating by mutual agreement with the owners.

Since January 24, 2023, at TC’s request, PSPC has also been responsible for expropriation under the Expropriation Act. On June 6, 2023, the Minister of Public Services and Procurement signed the notices of confirmation of expropriation, which were published in Quebec’s land register on June 14, 2023, formalizing the expropriation.

PSPC also submitted a request to the Governor in Council on TC’s behalf for an Order in Council to take possession of the land as soon as possible to meet the construction deadlines for the new bypass. The request was endorsed by the Governor in Council, formalizing the legal instrument.

Partners and Stakeholders

Since 2021, PSPC representatives have visited Lac-Mégantic on numerous occasions to meet with property owners affected by the project.

The federal government is also working with the municipalities of Lac-Mégantic, Frontenac and Nantes, and with the Quebec Ministère des Transports et de la Mobilité durable.

On November 12, 2024, the Nantes municipal council adopted a resolution confirming the withdrawal of its support for the project. The town of Lac-Mégantic remains committed to the project, and will continue to co-operate in its advancement. 

Key Challenges

The project is facing opposition from property owners affected by the expropriation, as well as from an interest group in the Lac-Mégantic region. On April 25, 2023, the Attorney General of Canada appointed Julie Banville as an investigator in the expropriation process. A total of 1,494 objections to the expropriation were received during the opposition period at the public hearings held from May 4 to 9, 2023. The investigator submitted her report to the Minister on May 25, 2023.

On July 13, 2023, an application for judicial review of the Minister’s decision to confirm the expropriation was filed in Federal Court by 14 owner applicants affected by the expropriation. On May 8, 2024, the Federal Court ruled in favour of the Attorney General of Canada, which ended the case.

As of February 21, 2025, 34 of the 42 former owners who were expropriated had accepted and signed their offer of compensation. [Redacted]. Under the Expropriation Act, expropriated owners have one year from the acceptance of the offer of compensation to contest the amount in Federal Court. [Redacted]. Any legal recourse against the Government of Canada regarding this expropriation is being handled diligently in co-operation with Justice Canada.

Health Centre of Excellence

Mandate

In 2019, the Government of Canada announced the proposal to build a new bilingual health care facility in New Brunswick. The new “Health Centre of Excellence” (HCoE) will include 155 health beds, comprising mental health beds, new accommodations for women offenders, and new hospital beds to support the Atlantic region. It will be located at Dorchester Penitentiary in Dorchester, New Brunswick. The total estimated contract value of the Health Centre of Excellence is $1.3 billion over a period of four years commencing in June 2025.

The Centre will deliver improved access to mental health services and more suitable care for federal offenders, contributing to a safer environment for both inmates and staff at the institution in a secure, modern facility. The project aligns with the Government of Canada’s commitment to modernize infrastructure and ensure the efficient delivery of essential programs and services.

PSPC is responsible for project management and procurement in support of the client department, Correctional Service of Canada.

Key Activities

An Advance Procurement Notice was published in July 2024 to engage industry early in the procurement process and to inform them of the upcoming requirement.

A Request for Qualification was issued on August 13, 2024, and closed on October 11, 2024. three responses were received. The following have been identified as the qualified respondents and will be invited to participate in the RFP: Bird Design-Build Construction Inc, EllisDon Corporation, and Pomerleau Inc.

The RFP will be a competitive procurement process, running approximately from February to June 2025. This process will conclude with the selection of the Preferred Proponent. PSPC and Correctional Service of Canada will collaborate with the Proponent to finalize the design and refine project costs. The initial agreement will include an option for the Proponent to undertake the facility’s construction, contingent upon reaching an agreement on the scope and price.

Work is expected to span a total of four years, with design development and pre-construction services anticipated to be completed within 12.5 months, followed by phased construction, which is expected to be completed within 35 months.

Partners and Stakeholders

PSPC will work with Correctional Service of Canada and the qualified respondents. The process will be overseen by OXARO Inc., a fairness monitor.

Key Challenges

This procurement leverages a novel, collaborative approach, the Progressive Design Build model. The project will be delivered in two phases: Phase 1 Design, and Phase 2 Construction. Under the Phase 1 Agreement, the Progressive Design Build Proponent will be responsible for all aspects of the design of the Project. Under the Phase 2 Agreement, the Progressive Design Build Team will be responsible for the construction of the Project.

Faro Mine Remediation Project

Mandate

The Faro Mine Remediation Project is one of Canada's most complex abandoned mine clean-up efforts. It is aimed at protecting human health and safety, restoring the environment, and advancing reconciliation with Indigenous communities. The Project involves stabilizing and remediating a 25 square kilometer site near Faro, Yukon, with 70 million tonnes of tailings and 320 million tonnes of waste rock at an abandoned mine.

CIRNAC plays a crucial role as the project sponsor, working to ensure that the remediation efforts align with broader goals of reconciliation and sustainable development in the North. PSPC supports CIRNAC as Contracting and Technical Authority on the project.

Key Activities

The Faro Mine Remediation Project is divided into four phases:

PSPC established the Remediation Plan Design and Support Services contract with AECOM Canada Ltd., for engineering support services. It [Redacted] could potentially extend up to 2043. The department has also established the Main Construction Management and Care and Maintenance Services contract with Parsons Inc. for site oversight and management. It is valued at over $2 billion and could potentially span 20 years. Additionally, there are a number of shorter-term ancillary contracts that provide environmental, regulatory, geotechnical, and independent engineering and cost analysis support services to the project team.

A key priority of the Faro Mine Remediation Project is maximizing socio-economic benefits for local Indigenous communities by incorporating direct and indirect Indigenous benefits within the related procurements. The majority of contracts issued in support of the Faro Mine Remediation Project include Indigenous opportunity considerations, which feature an incentive and deduction methodology tied to building local Indigenous capacity through labour, training, and subcontracting opportunities.

The Faro Mine Remediation Project also includes the future construction, installation, testing, and commissioning of a Permanent Water Treatment Plant designed by Jacobs to ensure long-term water quality management. The design is currently under revision; the revised design will help frame the next steps for Permanent Water Treatment Plant construction and related procurement planning.

The Permanent Water Treatment Plant was initially planned to be procured and managed by the Main Construction Management during the active remediation phase. Due to deteriorating site conditions, however, it was identified that the Plant would be required sooner than originally forecasted. The Main Construction Management led a cost-reimbursable procurement process, resulting in a winning bid significantly higher than anticipated, which led PSPC to cancel the requirement in October 2024.

Other delays caused by insufficient authorities, unconfirmed regulatory requirements, and unforeseen site conditions requiring further design changes have led to deferring the retender of the Permanent Water Treatment Plant. PSPC and CIRNAC are continuing to assess mitigating actions in 2025 to 2026 while evaluating interim treatment options for future recommendations.

Partners and Stakeholders
Key Challenges

Giant Mine

Mandate

Giant Mine is an abandoned gold mine near Yellowknife, Northwest Territories. From 1948 to 2004, it generated 237,000 tonnes of arsenic trioxide dust, stored in underground excavated areas. Should the arsenic trioxide be released into the local groundwater system, it could have significant implications for nearby waterbodies, including Great Slave Lake. At over 1,100 hectares, the site includes open pits, tailing ponds with surface waste, and buildings contaminated with fibrous asbestos.

PSPC provides project management and procurement services, while project accountability, stakeholder and rights holder engagement, and regulatory responsibility rest with CIRNAC. Parsons, the Main Construction Manager and Mine Manager, is responsible for site care and maintenance and executing the remediation activities.

The project is in its implementation phase (full remediation) and the estimated cost is $4.38 billion. This reflects extensive remediation costs and adjustments for inflation over the full life of the project to 2038.

Key Activities

A key focus of work is construction of a new water treatment plant to control the mine water level and prevent migration of arsenic contaminated water into the environment. This is accomplished by pumping and treating mine water to remove arsenic prior to discharge into Yellowknife Bay. The construction contract was awarded in April 2023, and work began in summer 2023, with expected completion of the water treatment plant by October 2026.

Another focus area has been underground stabilization work. Work completed in October 2024 concentrated on backfilling near surface underground stopes to mitigate the risk of the ground sinking or sinkholes being created and to improve the overall stability of the underground workings and freeze area. This marks the end of the Project's underground stabilization work and allowed the project to shut down and permanently exit the underground mine.

Following the 2023 wildfires, the project team took action to reduce the risk of area wildfires impacting the site. This has been achieved through collecting brush and clearing materials from recent construction and moving these away from structures onto tailings ponds located within the core of the site. The project team will continue to monitor and manage risks on and to the site, considering all information, research, and expertise available, to keep the public and environment safe.

The project team is now focusing on the next wave of major activities starting in 2025 to 2026, including design and procurement for the:

Partners and Stakeholders

Government representatives regularly meet with all rights holders and stakeholders through working groups and committees where the project’s socio-economic aspects are discussed, and plans are shared.

Since 2005, the total value of issued contracts is $1.4 billion. Of this, $503 million (35%) has gone to Indigenous contractors, including $292.5 million in contracts to companies affiliated with the Yellowknives Dene First Nation.

In April 2023, Canada and the Yellowknives Dene First Nation signed a Procurement Framework Agreement, which includes increasing procurement opportunities to the First Nation and other local Indigenous peoples, prioritizing contracts to Indigenous-owned businesses in the community, and an ongoing accountability mechanism for the Project Team to report back to the Yellowknives Dene First Nation.

Community Benefits Agreements between Canada and the Yellowknives Dene First Nation, and the North Slave Métis Alliance, are also in place to help deliver socio-economic benefits to local rights holders.

Canada has additional obligations to the Tłichǫ First Nation for economic measures including government contracting, as defined in the Tłichǫ Land Claims and Self Government Agreement. Negotiations for a Community Benefits Agreement with the Tłichǫ are underway.

Key Challenges

Maximizing northern and Indigenous economic opportunities continues to be a focus for rights holders and stakeholders. Media attention and sensitivity related to the project’s socio-economic impacts is expected to continue.

Construction of the new water treatment plant is fundamental to full remediation. Should procurement or construction delays occur, subsequent remediation activities could be affected.

Over the next couple of years, a few significant procurement packages will be posted by the main construction manager including on-site aggregate production (2025) and major earthworks (2025). These packages are on the critical path for the project and unproductive procurement processes could have significant schedule impacts.

Portfolio Overview

Canada Post Corporation

Mandate

The Canada Post Corporation (Canada Post), created in 1981 by the Canada Post Corporation Act, is an agent Crown corporation listed in Schedule III Part I of the Financial Administration Act.

Under the Act, Canada Post has the exclusive privilege to collect, transmit and deliver letters up to 500 grams within Canada (the letter mail monopoly), a mandate to provide quality postal services to all Canadians, rural and urban, individuals and businesses, and to accomplish this in a secure and financially self-sustaining manner.

Canada is a member of the Universal Postal Union, the United Nations agency that coordinates postal policies among 192 member nations. Members of the Universal Postal Union have a service obligation to “ensure that all postal consumers enjoy the right to a universal postal service involving the permanent provision of quality basic postal services at all points in their territory, at affordable prices”. Canada Post has been designated the sole entity in charge of fulfilling, on Canada's behalf, the responsibilities of operating postal services to meet these obligations and the Canadian Postal Service Charter is the expression of Canada’s universal service obligation.

Canada Post reports to Parliament through the Minister of Public Services and Procurement. It is at arm’s length with respect to operations, but it takes policy direction from the Minister in terms of its priorities. The Minister is accountable for providing guidance and oversight to ensure that the overall direction and performance of the Corporation aligns with the Government’s policies and objectives. This is normally communicated via an annual letter of expectations.

In 2021, the Prime Minister mandated the Minister of Public Services and Procurement to ensure that Canada Post provides high-quality service at a reasonable price and better reaches Canadians in rural and remote areas.

Key Activities

In 2023, the Canada Post Group of Companies, consisting of Canada Post and its three subsidiaries at the time, delivered 6.6 billion pieces of mail, parcels, and messages to over 17 million address in urban, rural, and remote locations across Canada.

In 2023, the Canada Post Group of Companies had annual revenues exceeding $9.7 billion and employed over 84,000 people (full-time and part-time employees, including temporary, casual, and term employees) across the country. Canada Post was the largest segment of the Group of Companies with revenue of $6.9 billion.

Year-end results for 2024 are not yet available.

Canada Post is one of the most recognized organizations in Canada. With almost 5,800 full-service post offices throughout the country, its retail presence eclipses all others in the Canadian market. Canada Post delivers mail to every address in Canada, about 17.5 million residences and businesses from coast to coast to coast. It maintains more than 974,000 collection points where mail can be deposited and Canada Post’s 68,000 employees handle over 6 billion pieces of mail using 14,800 vehicles, 22 processing plants, and 462 letter carrier depots.

Canada Post now only has one subsidiary, Purolator, as Canada Post divested of its two other subsidiaries, SCI Group and Innovapost, in March and April 2024, respectively.

Purolator, which is 91% owned by Canada Post, is one of Canada’s leading integrated freight and parcels solutions provider with revenue of $2.7 billion in 2023.

Partners and Stakeholders

Canada Post works closely with its sole shareholder, the Government of Canada. Canada Post’s interaction with the Government as shareholder necessitates that it be responsive to a broad range of governmental actors. Some of these include Parliament, the Governor in Council, PCO, TBS, the Minister responsible for Canada Post, and the Minister of Finance. Each entity has the role of shareholder and guardian of the public interest.

Canada Post’s unions are also key stakeholders; they are a voice for employees and act as bargaining representatives during negotiations. They include:

Canada Post: Key Challenges

Canada Post operates within a policy framework established by the Government of Canada that includes the rural moratorium on the franchising or closure of more than 3,000 corporate owned post offices (1994), a 2006 directive to restore rural mailbox delivery, the 2009 Canadian Postal Service Charter (“Service Charter”), and a prohibition on the conversion of door-to-door to community mailbox delivery (2017).

The Service Charter was established to guide Canada Post’s service obligations and includes service standards such as daily mail delivery, uniform postage rates for letters and the number of days to deliver a letter between locations. The Service Charter requires that postal services remain universal, affordable, reliable, convenient, secure and responsive to the needs of Canadians. It is also subject to review every five years. With the last one completed in 2018, a review of the Service Charter was due in 2023.

Canada Post was established to provide a high-quality postal service at a reasonable price, while conducting its operations in a financially self-sustaining manner; however, the Corporation’s ability to meet the current standards set out in the Service Charter while operating in a manner that is financially self-sustaining is no longer feasible. Canada Post is at a precipice financially due to the ongoing drop in revenue from the decline in letter mail, the high cost of a rigid, labour-intensive operation, and its declining market share in the increasingly competitive parcel delivery industry.

Since 2018 Canada Post has reported more than $3 billion in losses, with $748 million in 2023 alone. Without changes to its operating model, losses will continue to grow into the future. Without action by the Government, Canada Post will exhaust its cash reserves and become insolvent when the Corporation needs to repay a $500 million bond in July 2025.

Cash Injection

On January 24, 2025, the Government announced its intention to provide Canada Post with up to $1.034 billion in 2025 to 2026 to maintain the Corporation’s solvency and ensure it can continue its operations. Any cash provided will be on an as-needed basis to pay non-discretionary obligations. The cash injection, which is a temporary measure that Canada Post will be required to repay, will ensure Canada Post can continue to serve Canadians while working with the Government on the changes required to ensure the long-term viability of Canada’s postal system.

2025 Stamp Rate Increase

To immediately improve Canada Post’s financial position and bring Canada’s stamp rates into greater alignment with international comparators, a stamp rate increase of $0.25 (25%) came into effect on January 13, 2025. While the increase will provide important revenues to Canada Post, it will be insufficient to address Canada Post’s financial challenges.

Labour

Canada Post’s two collective agreements with the Canadian Union of Postal Workers expired on December 31, 2023, (Rural and Suburban) and January 31, 2024 (Urban). Canada Post and the Union had been negotiating since November 2023; however, despite more than 100 meetings, the parties were unable to reach an agreement and on November 15, 2024, the Union launched a national work stoppage, with no indication of its duration or end date.

On December 13, 2024, the Minister of Labour announced his use of section 107 of the Canada Labour Code, and provided direction to the Canada Industrial Relations Board to assess the need to intervene. On December 15, 2024, the Board concluded that the parties remained at an impasse and ordered Canada Post employees back to work, extending the existing collective agreement until May 22, 2025; the Canadian Union of Postal Workers is challenging the constitutionality of the Minister of Labour’s direction to the Canada Industrial Relations Board.

The Minister of Labour also appointed an Industrial Inquiry Commission to examine the issues preventing the resolution of the labour dispute. The Commission held hearings in January and February 2025 with a final hearing scheduled in March 2025. The Commission will provide recommendations to the Minister of Labour by May 15, 2025. A work stoppage could reoccur as early as May 23, 2025.

In its submissions to the Industrial Inquiry Commission, Canada Post highlighted its financial and operational challenges, emphasizing the urgent need for additional flexibilities in its collective agreements as well as calling for policy and regulatory reform, including a reversal of the Government’s 2018 decision to terminate Canada Post’s program to convert home delivery to community mailboxes, and more timely reviews of the Service Charter. Conversely, the Canadian Union of Postal Workers has argued that the Industrial Inquiry Commission is the wrong venue to examine public policy questions around the mandate of Canada Post, given its limited time and lack of public consultation process, and that the Commission should instead focus strictly on collective bargaining issues. In that respect, Canadian Union of Postal Workers questions the narrative around the causes of Canada Post’s current financial situation and the need for concessions from postal workers while presenting an alternative vision for Canada Post focused on expanding public services, such as postal banking and senior check-ins, while advocating for improved working conditions and wages.

National Capital Commission

Mandate

The NCC is a federal Crown corporation created by Canada’s Parliament in 1959 under the National Capital Act. It is the long-term planner and principal steward of significant public places, and a partner in the development, conservation and improvement of Canada’s NCR).

Key Activities

NCC is the main federal urban planner in Canada’s NCR. In this role, the Commission works in collaboration with stakeholders to set the long-term planning direction for federal lands, identifies and manages lands of national interest, approves design and land use changes involving federal lands in the NCR, and facilitates federal involvement in transportation planning.

In its stewardship and protection role, the Commission manages and develops federal lands and assets, such as the official residences in the NCR, and manages the public places that are unique to Canada’s symbolic, natural and cultural heritage. It owns and manages 11% of all land in the NCR with a total replacement value of $2.2 billion, including six official residences, 1,000 buildings, 145 bridges (including the Champlain Bridge and the Portage Bridge), 425 km of parkways and pathways, Gatineau Park (361 km2) and the Greenbelt (200 km2), 23 urban parks, and 65 commemorations and public art displays.

Partners and Stakeholders

The Commission works closely with a number of key partners:

Key Considerations

Budget 2024 called for all federal entities to contribute to utilizing public lands for housing. In support of this work, the NCC is developing a Real Property Portfolio Strategy and plans to develop and lease 8,000 to 10,000 housing units in the NCR over the next 10 years.

Pursuant to Section 12 of the National Capital Act, the NCC is mandated to regulate land use and design in the NCR through a process called the Federal Land Use Design and Transaction Approval process.The provisions of the National Capital Act relating to the process require all individuals and federal organizations (including PSPC) to obtain NCC approval before undertaking projects if (1) the project is located in the NCR; (2) the project affects federal lands and/or federal buildings; and (3) the project is on non-federal land, but the proponent is a federal organization. In 2019, the NCC undertook a comprehensive review of the Federal Land Use Design and Transaction Approval approval process and adopted improvements to delivery and performance management practices to respond to the increasing volume, complexity, and urgency of approval submissions. The process is being further streamlined to support the construction of housing in the NCR in an expedited manner.

The Gatineau Park Master Plan (2021) outlines conservation and planning goals for Gatineau Park. The park, Canada’s second most visited, does not have the same legal protections as other national parks under the Parks Canada Act. The Master Plan calls for legislative protections for Gatineau Park that specify its protected status, an update to the technical description of the park’s boundaries, and clarification of the powers of the managers of Gatineau Park. Furthermore, on October 10, 2024, Independent Senator Rosa Galvez (Quebec) tabled Senate Bill S-289, an Act to amend the National Capital Act (Gatineau Park), which proposes legislation aimed at protecting Gatineau Park.

In January 2022, the NCC Board of Directors approved the Long-Term Interprovincial Crossing Plan, which set forth the vision, policies, and infrastructure priorities for sustainable interprovincial travel in the NCR. Departmental officials are working with the NCC on next steps for planning an additional interprovincial crossing, and on the replacement of the aging Alexandra Bridge. The NCC has also implemented Budget 2021’s direction for the NCC to create an “interprovincial transit project office to study and plan for a potential interprovincial tramway.” The recent 2024 Fall Economic Statement proposes to provide $31.6 million over three years, starting in 2025 to 2026, to conduct feasibility studies for the 2-kilometre federal and Ontario portions of the Gatineau-Ottawa tram project. This funding builds on the joint investment with Quebec and means the federal government has now put forward the funding required to complete feasibility studies for the proposed tram’s entire 24 kilometre route.

In the 2022 Fall Economic Statement, the NCC received funding for Protecting Heritage Assets. The Department is working with NCC to ensure this new funding will address the deferred Official Residences maintenance (see separate note on Official Residences).

Official Residences

Mandate

The NCC is responsible for the official residence portfolio, which includes six official residences:

The entire portfolio also includes 49 secondary buildings, and has a total gross area of about 25,000 square metres.

Key Challenges
Building conditions: Overall

Over the past several years, the overall NCC asset portfolio has been found to be in poor condition. In 2017, the Office of the Auditor General found that while the NCC’s management practices were sound, there was “significant deficiency” in its asset maintenance and that the shortfall in resources would prevent it from properly restoring and maintaining all of its assets, including Canada’s official residences.

The 2021 Asset Portfolio Condition Report reiterated this concern by highlighting the deferred maintenance gap and identifying the requirement for an injection of $175 million over 10 years to address the deferred maintenance deficit for all six official residences. The report also found that the overall condition of the residence portfolio continued to deteriorate with only 24% of the assets considered to be in “good” condition, down from 34% in 2018.

The 2022 Fall Economic Statement allocated $332.6 million plus $28.4 million ongoing yearly funding to the NCC for protecting heritage assets (excluding 24 Sussex). PSPC is working with NCC to ensure this funding will address the deferred maintenance within the official residences.

Building conditions: 24 Sussex

24 Sussex Drive is the only main residence within the official residences portfolio that is in “critical” condition. While the residence has been unoccupied since 2015 given health and safety concerns, it was officially closed by the NCC in spring 2023 when employees relocated to begin urgent abatement and decommissioning work.

Over the last decade, the NCC has completed urgently required work to address key health and safety issues. With the abatement work at 24 Sussex now complete, the future of the residence has garnered public attention, including from previous Prime Ministers.

The department is working with the NCC, the RCMP and Central Agencies on a plan for the future of the Prime Minister’s Residence.

Canada Lands Company Limited

Mandate

The mandate of Canada Lands Company Limited (CLCL), an agent federal Crown corporation, is to ensure the commercially oriented, orderly disposition of surplus strategic real properties, optimizing financial and community value, and the holding of certain properties. It accomplishes this by purchasing strategic surplus properties from federal departments and agencies at fair market value, then improving, managing or selling them to produce the optimal benefit for the Company’s shareholder, the Government of Canada, and local communities. CLCL defines optimal benefit to include both non-financial and financial results.

Budget 2024 expanded the Company’s role to support the Government’s housing initiatives. This included providing leases, including long-term, low-cost leases, to housing providers; managing lands transferred to them from the Government of Canada for $1 to support additional affordable housing; and enabling housing development on certain federal properties.

Key Activities

CLCL was created in 1956 to hold, develop and dispose of Government of Canada real property. It is a shell corporation that has three subsidiaries:

Canada Lands Company was created in 1995 to optimize the financial and community value of strategic surplus Government of Canada properties. Canada Lands Company is considered to be the real estate arm of the Company and handles almost all the real estate purchases and sales. It also operates the CN Tower in Toronto. When a surplus federal property is identified as being strategic, the land is sold to the Canada Lands Company so that it can develop it and derive further value or potential for housing.

Parc Downsview Park was created in 1998 to hold the former Canadian Forces Base in Toronto, with the purpose of using these lands primarily as a unique urban recreational green space. The Downsview property consists of 572 acres of land, which is largely comprised of park land but also includes a number of existing and proposed neighbourhoods and facilities.

The Old Port of Montreal Corporation was created in 1981 to promote development of the Old Port of Montreal lands and to administer, manage and maintain the property as an urban recreational site. The Port also manages the Montreal Science Centre.

Partners and Stakeholders

CLCL works with local municipalities, relevant stakeholders and partners in various infrastructure projects across the county. Among other things, it facilitates the provision of affordable housing units in its projects. It is a partner in the Federal Lands Initiative, a part of the National Housing Strategy, with PSPC and the Canada Mortgage and Housing Corporation.

CLCL strives to maintain strong partnerships with Indigenous peoples. As of 2024, it has entered into agreements of various forms with six First Nations covering projects on five properties in Vancouver, Winnipeg, Ottawa, and Halifax.

Key Challenges

CLCL has a number of large development projects across Canada that are complex in nature. Their progress is influenced by external factors, such as the labour market, interest rates and economic growth. For example, current projects include:

Defence Construction Canada

Mandate

Defence Construction Canada (DCC) is a Crown corporation that assists the Government of Canada with military procurements and delivers defence infrastructure projects. Its aim is to meet the needs of DND and CAF for infrastructure, management or real property and environmental services by advising on, collaboratively planning, procuring and managing defence contracts.

Key Activities

DCC’s work covers a broad range of activities, from project needs planning to building decommissioning. The Corporation’s service delivery resources are organized among the following five service lines: Contract Services, Contract Management Services, Environmental Services, Project and Program Management Services, and Real Property Management Services.

DCC activities include demolishing underused or obsolete buildings; renovating and improving facilities on bases and wings, such as housing for military personnel; and building new infrastructure for major CAF programs. It is self-financing, operating on a fee-for-service basis. DCC delivers approximately $1.1 billion in contract payments on a yearly basis and manages a contract portfolio worth $8.9 billion.

Some of its most noteworthy projects include the following:

Partners and Stakeholders

According to the Defence Production Act, DCC is restricted to providing services to and for the Minister of National Defence, DND and CAF.

Budget 2024 encouraged DCC to support the Government’s housing commitments by working in collaboration with DND and PSPC to identify opportunities to build more housing.

Key Challenges

DCC expects to face significant generational turnover with over one-fifth of construction workers on track to retire within ten years. To remain an employer of choice, address the demographic realities of the future labour market and retain top talent, DCC has instituted a comprehensive Human Resources Strategy.

DCC is taking actions to support business opportunities for Indigenous Peoples and to achieve long-term, sustainable and meaningful economic benefits for Indigenous Peoples. It developed a joint Indigenous Procurement Strategy to enhance the DND’s efforts to engage Indigenous businesses and is implementing its Indigenous Relation Policy. In 2022 to 2023, it surpassed the Government of Canada’s goal to direct at least 5% of spending contracts to indigenous businesses and reached 9.8%.

The Office of the Procurement Ombud

Mandate

The Office of the Procurement Ombud (recently updated from the Office of the Procurement Ombudsman to promote gender and linguistic neutrality) was created in 2006 as a neutral organization to promote fairness, openness, and transparency in federal procurement, and helps resolve contracting disputes between businesses and the federal government. The Office operates independently from PSPC and reports directly to the Minister of Public Services and Procurement. The Office provides an independent avenue for stakeholders to have procurement concerns addressed. Departments, however, are not required to participate in these services and the Procurement Ombud’s recommendations are non-binding.

Key Activities

The Office’s key responsibilities include:

Partners and Stakeholders

The Office of the Procurement Ombud works with independent suppliers, federal departments, and others interested in federal procurement.

While the Office operates independently from PSPC, the Financial Administration Act does not provide for the Office of the Procurement Ombud to be a separate entity. Therefore, many of its corporate services, including the funds management function, are carried out by PSPC and governed by a MOU, which is signed by the Procurement Ombud and the Deputy Minister of Public Services and Procurement Canada.

Key Challenges

The Office of the Procurement Ombud has included, in public reports, recommendations for legislative and regulatory amendments to the Public Works and Government Services Act and the Procurement Ombudsman Regulations regarding the authorities of the Procurement Ombud. More specifically, changes would permit the Ombud to recommend compensation greater than 10% of the value of the contract, compel federal departments to provide the Procurement Ombud with documentation for reviews, and enable the Procurement Ombud to review complaints related to the Procurement Strategy for Indigenous Business set-asides program. Given these would require adjustments to the Act and Regulations, the Office of the Procurement Ombud is engaging with the department to work through the proposed changes.

In his 2023 to 2024 Annual Report, the Procurement Ombud called for a government-wide Vendor Performance Management Program and the creation of a federal Chief Procurement Officer. While these recommendations would impact PSPC, they extend beyond the department given their government-wide nature.

Finally, the Office of the Procurement Ombud has also called for additional funding for its work in recent public reports. Given its allocated budget has remained static for over 15 years, the Procurement Ombud has expressed that budget constraints and inflationary pressures have made it increasingly difficult to serve Canadian suppliers and federal departments effectively. In addition, there has been an increasing demand for the Office’s services. While reviews requested by the Minister and Parliamentarians over the past year have been funded through a one-time funding allocation provided by PSPC, the Procurement Ombud continues to raise the need for a permanent funding solution.

Payments in Lieu of Taxes Dispute Advisory Panel

Mandate

Under section 125 of the Constitution Act, 1867, the Government of Canada is exempt from local taxation. However, since the 1950s, the federal government has shown its commitment to supporting local communities and sharing local costs by making Payments in Lieu of Taxes (PILT) to the municipalities where it owns real property. Payments are calculated on the basis of values and rates that would apply to federal property if it were taxable.

The mandate of the Payments in Lieu of Taxes Dispute Advisory Panel (PILT-DAP), as directed in the Payment in Lieu of Taxes Act, is to provide advice to the Minister of Public Services and Procurement to resolve disputes about payments in lieu of taxes between the federal government and local taxing authorities.

The panel has the mandate to provide advice pertaining to the resolution of disputes about property value, property dimension or effective rate used to calculate payments in lieu of taxes, or about a claim for a late payment supplement.

The panel also provides advice to the heads of Crown corporations who exercise their own discretion concerning their respective corporation's payments in lieu of taxes.

Key Challenges
Governor in Council Appointments

As per the Act, the PILT-DAP is to consist of at least two members from each province and territory with relevant knowledge or experience. Reaching full membership on the Panel has been challenging given the very specific knowledge and experience required and the compensation to members, which has not been reviewed since 2004. This has resulted in PILT-DAP experiencing systemic geographic vacancy and not fully reflecting Canada’s diversity in its membership. Given there are no provision in the Act to allow members to serve beyond the expiry of their term, once a term is expired, the position is left vacant and ongoing cases are halted. The Department is exploring options related to the remuneration.

Concerns from some municipalities

A number of municipalities, including Ottawa and Chelsea, have raised concerns regarding the amount of payment provided by the Government of Canada through PILT for specific properties. Municipalities that disagree with amounts determined by the PILT-DAP can turn to the Courts for reconsideration.

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