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Standing Committee on Government Operations and Estimates: October 30, 2025

Mandate and priorities for Minister of Government Transformation, Public Works and Procurement
Date: October 30, 2025
Location: In person

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General items

Opening remarks

The Honourable Joël Lightbound
Minister of Government Transformation, Public Works and Procurement

Standing Committee on Government Operations and Estimates (OGGO)

October 30, 2025

Opening

Thank you, Mr. Chair.

I would like to acknowledge that we are gathered today on the traditional, unceded territory of the Algonquin Anishinaabe People.

It is my honour to serve as Minister of Government Transformation, Public Works and Procurement during these unprecedented times.

I’m joined today by Arianne Reza, Deputy Minister of Public Services and Procurement Canada and Scott Jones, President of Shared Services Canada.

Mr. Chair, geopolitical risks are rising, threatening our sovereignty, and our global trading system is undergoing a massive transformation.

To address these challenges headon, we must redefine international, commercial, and security relationships in ways that benefit Canada and Canadians and grows our economy.

And we must use all levers of Government to protect our sovereignty.

As Minister responsible for Public Services and Procurement Canada and Shared Services Canada, I have informed the Prime Minister of my plans to advance key initiatives in support of the priorities he established in his mandate letter—and we have already made progress on a number of fronts.

Progress on mandate priorities

Transform Government operations

First, Mr. Chair, we know that we need to transform the way government operates. There is an excess of red tape and duplication in the federal system and that must change.

In addition to back office modernization, we are also focused on making sure frontline services to Canadians are improved and protected. These efforts include the recent measures we have undertaken to find efficiencies and secure the future of Canada Post, as I announced on September 25th and as we discussed last week.

Reshape Federal Procurement

When it comes to federal procurement, our processes are unnecessarily duplicative and do not sufficiently prioritize Canadian suppliers in the current geopolitical context.

On July 14th, we implemented the Interim Policy on Reciprocal Procurement, which prioritizes suppliers from Canada, as well as suppliers from reliable trading partners who provide access to Canadian suppliers to their markets.

On September 5th, we announced the Buy Canadian Policy which will ensure federal spending supports Canada’s economic growth, strengthens supply chains, and creates opportunities for businesses and workers across the country.

This new Buy Canadian Policy will be launched in the coming weeks, and will aim to prioritize Canadian suppliers and materials, encourage the use of Canadian inputs and local content, and streamline procurement processes.

We will also launch a Small and Medium Business Procurement Program to cut red tape and help Canadian businesses navigate the federal procurement system more easily.

Overhaul defence procurement

As for defence procurement, on October 1st, we established the Defence Investment Agency, under the leadership of my colleague, Secretary of State Stephen Fuhr.

The new agency will consolidate and accelerate defence procurement processes, and it will support homegrown innovation to create economic growth while helping more Canadian defence firms scale up and compete globally.

National Shipbuilding Strategy

One of the most prominent examples of supporting large-scale homegrown achievement has been the National Shipbuilding Strategy.

As of February 2025, the Government has awarded approximately $36.35 billion in contracts under the Strategy to businesses across the country. Of these, $1.17 billion went to small and medium businesses with less than 250 employees.

We want to better leverage federal procurement to extend this kind of successful growth of domestic production across more industries, further strengthening our economy and safeguarding our sovereignty.

Safeguard data sovereignty and cybersecurity

Mr. Chair, I’ve spoken about how building economic strength and defence capacity are essential to protecting our sovereignty. Data sovereignty and cyber security are equally important to that goal.

Shared Services Canada (SSC) is at the centre of our efforts to deliver digital services for Canadians, and the department’s work is transforming government operations by shifting away from decentralized systems to a unified model that supports digital government.

By consolidating key systems in data centres located in Canada, SSC has achieved cost savings, significantly improved the availability and stability of government services, and strengthened the protection of critical government, data and information.

It has also reinforced our cyber defences through initiatives like the Secure Cloud to Ground service and the Cyber Security Program Management office, along with integrated enterprise, monitoring tools. These efforts protect Canadians and ensure the resilience and sovereignty of our digital systems.

The department will continue to implement secure, integrated enterprise solutions as it delivers modern public services that meet the highest standards of security and privacy.

Closing

In closing, Mr. Chair, our country faces some historical challenges and we are moving rapidly to meet the moment.

Canada’s new Government has a plan to make this country a stronger, safer and more prosperous country for all; and Public Services and Procurement Canada and Shared Services Canada are contributing to those critical outcomes.

Thank you.

Government transformation

Red tape reduction measures

Issue

In response to the red tape review process led by the President of the Treasury Board, Public Services and Procurement Canada (PSPC) and the National Capital Commission reviewed their regulations to reduce administrative burden, modernize processes and eliminate outdated regulations.

Key facts

Key messages

Background

On July 9, 2025, the President of the Treasury Board called on all Ministers with regulatory responsibilities to undertake a 60-day review of their regulatory portfolios to reduce red tape and support a stronger, more inclusive Canadian economy.

Ministers were asked to publish progress reports outlining immediate actions taken, as well as short, medium, and long-term plans to streamline regulations.

For Public Services and Procurement Canada, the list of actions outlined in the progress report include:

  1. Develop Harmonized Procurement Regulations
  2. Update of the Controlled Goods Regulations
  3. Review of Translation Bureau Regulations
  4. Amend the Government Property Traffic Regulations
  5. Amend the Public Works Nuisances Regulations
  6. Amend the Seized Property Disposition Regulations
  7. Amend the Canada Gazette Publication Order, 2014
  8. Repeal the Selkirk Marine Railway Dry Dock and the Canadian Vickers Dry Dock Regulations

For the National Capital Commission, the list of actions outlined in the progress report include:

  1. Develop leaner processes for the Federal Land Use, Design and Transaction Approval and Environmental Impact Assessment
  2. Modernizing the National Capital Act

Public Services and Procurement Canada government transformation

Issue

The Government is pursuing enhanced productivity through the large-scale deployment of artificial intelligence (AI). Greater effectiveness and efficiency in government processes will also lead to improvements in service delivery for Canadians.

Key facts

As a common service organization, Public Services and Procurement Canada provides a suite of back-office services that support operational efficiency and organizational transformation across the Government of Canada

Key messages

Background

Public Services and Procurement Canada and Shared Services Canada leverage their legislative powers to deliver innovative services that make government more efficient and cost-effective. These initiatives support modernization, encourage the responsible use of artificial intelligence and help reduce expenditures, allowing Canadians to invest more in the economy.

Annex on GCTranslate

Issue

GCtranslate, the artificial intelligence (AI)-powered language hub for the Government of Canada, is being developed as part of the AI Strategy for the Federal Public Service. It can be used to translate government documents without compromising data security and sovereignty.

GCtranslate contributes to Priority 7 of the Government of Canada (Spending less on government operations so that Canadians can invest more in the people and businesses that will build the strongest economy in the G7). At this point, the department is assessing the potential savings of this initiative.

Action taken to date / Accomplishments

GCtranslate was rolled out across PSPC in June 2025, and then in the following 5 federal organizations in September 2025 (total of 35,000 public servants with an expected volume of 465 million words per year):

As of October 16, 2025, GCtranslate had translated over 95 million words.

Between June and September 2025, GCtranslate translated more than 77 million words (approximately 220,000 pages), an increase of 1,300% compared to the 5 million words (approximately 15,000 pages) usually translated in 4 months by the Translation Bureau for PSPC.

The cost of translation services in the private sector is between $0.15 and $0.40 per word depending on the type of translation. Currently, the cost of human translation by Translation Bureau is approximately $0.39 per word to provide quality translation services.

Timelines for completion

Government of Canada-wide roll out is planned to begin end of the 2026 to 2027 fiscal year. The timing of this is conditional on Shared Services Canada being able to provide a single sign-on experience, allowing all Government of Canada employees to access the system using their existing work credentials. This supports the processing of Protected B information and enables streamlined onboarding across departments.

Costs (To date and projected)

The first 2 years (roll-out) will be funded within PSPC's current reference levels. Ongoing funding model will need to be secured for subsequent years.

The forecasted cost for AI model training/testing and operations and maintenance are:

Legislative requirements

This initiative does not have a legislative requirement.

Shared Services Canada government transformation

Issue

As the Government of Canada’s (GC) common information technology (IT) services provider, SSC plays a central role in driving government transformation and creating government-wide efficiencies—in close collaboration with the Treasury Board of Canada Secretariat’s (TBS) Office of the Chief Information Officer (OCIO) and PSPC.

Key facts

n/a

Key messages

If pressed on cost savings:

Background

SSC is responsible for modernizing, securing and managing the IT infrastructure that supports departments and agencies. This ensures reliable and effective service delivery to Canadians, both domestically and abroad.

TBS’s OCIO sets government-wide direction for data, IT, cyber security and service management, while individual departments and agencies remain responsible for their own applications and data.

Review of Government of Canada contracts

Issue

The Minister of Government Transformation, Public Works and Procurement and the Minister of Finance have directed the public service to review all current and planned federal contracts in an effort to find cost savings.

Key facts

n/a

Key messages

Background

In an effort to enhance financial discipline and strengthen and streamline procurement processes, the Minister of Finance and the Minister of Government Transformation, Public Works and Procurement have directed a comprehensive review of all current and planned federal contracts. This initiative aims to identify cost-saving opportunities, prioritize re-negotiating contracts, and ensure that Canada’s Pricing Framework be followed and regularly updated to bring cost savings to taxpayers.

Canada Post transformation

Issue

The Government has instructed Canada Post to take steps to transform its operations and work toward becoming financially self-sustaining.

Note: Questions regarding the labour situation fall under the responsibilities of the Minister of Jobs and Families and the Secretary of State (Labour).

Key facts

Key messages

If pressed on the updates to letter delivery standards:

If pressed on community mailboxes conversion:

If pressed on ending the rural moratorium:

Background

Canada Post is facing financial and operational pressures. In 2024, it reported a loss before tax of $841 million – its seventh consecutive – and is on track to post a larger loss in 2025.

On January 24, 2025, the Government of Canada announced a temporary and repayable cash injection of up to $1.034 billion to Canada Post to maintain its solvency. Since November 2023, negotiations between Canada Post and the Canadian Union of Postal Workers have been at an impasse.

In May 2025, William Kaplan was appointed to lead an Industrial Inquiry Commission to examine Canada Post’s financial challenges in the context of the collective-bargaining dispute, with special attention to the underlying causes of the dispute.

The Industrial Inquiry Commission report, submitted on May 15, 2025, outlined structural and financial challenges faced by Canada Post and made recommendations for both the Government and for collective bargaining, to return Canada Post to some degree of financial sustainability so it can continue, but in a manner that reflects 2025 realities.

Annex – Canada Post transformation

Issue

On September 25, 2025, the Minister of Government Transformation, Public Works and Procurement, responsible for Canada Post, announced that he had accepted the recommendations of the Industrial Inquiry Commission in its report released on May 15, 2025. The report also instructed Canada Post to begin transforming its operations in order to stabilize its finances and enable this transformation. Additionally, Canada Post was directed to review its overhead costs as well as its management and executive structure.

Action taken to date

Building on the recommendations of the Industrial Inquiry Commission, the Minister announced the following measures:

The Minister instructed Canada Post to operationalize the transformation measures he announced on September 25, 2025, and respond with a plan within 45 days with additional proposals that will return the Crown corporation to financial solvency. As part of this plan, Canada Post is expected to review its corporate structure and reduce its overhead costs by at least 15%, aligning with the spirit of the government’s comprehensive expenditure review.

Canada Post must also outline an implementation plan detailing how it will right-size the retail post office network in overserved areas, without removing locations in underserved areas, before any post office closures occur.

The Chair of the Board of Directors of Canada Post has since acknowledged receipt of the Minister’s instructions and expressed support for the announced measures.

In addition, on October 17, 2025, the government tabled its response in the House of Commons to the report of the Standing Committee on Government Operations and Estimates entitled Canada’s Postal Service: A Lifeline for Rural and Remote Communities (PDF), tabled on June 20, 2025. The response highlights the measures undertaken to begin transforming Canada Post, while acknowledging them as a first step, and underlining the government’s commitment to continue protecting the services that Canadians rely on from coast to coast, particularly those in rural, remote and Indigenous communities.

Timelines for completion

The Minister’s measures are the first step in Canada Post’s multi-year transformation.

Canada Post has been asked to provide an implementation plan within 45 days, or in early November.

The operationalization of the transformation of Canada Post will be overseen by Canada Post’s Board of Directors, the Minister responsible for the Crown corporation, and the Treasury Board through Canada Post’s annual corporate plans, and supported by officials at PSPC.

Canada Post will report on its progress in future annual reports, which will continue to be tabled in Parliament, along with annual corporate plan summaries.

Costs to date and projected

The government is committed to ensuring that all Canadians continue to have access to the postal services they rely on.

Additional financial support may be required in the near to medium term, while Canada Post implements the transformational measures.

When fully implemented, the Minister’s measures, announced on September 25, are expected to deliver annual savings exceeding $500 million.

Legislative requirements

The government is also reviewing the time-consuming regulatory process for increases to stamp rates, in line with the recommendations of the Industrial Inquiry Commission’s report. This review may require future legislative amendments.

Update on the move to Dayforce

Issue

Progress continues to be made on the way forward on the transition from the Phoenix system to the Dayforce human resources (HR) and pay solution.

Notes:

Key facts

n/a

Key messages

If pressed on the status of Dayforce:

Background

In 2024 to 2025, the feasibility of transitioning to a Software-as-a-Service integrated HR and Pay solution (Dayforce) was assessed as part of the Transformation of HR and pay. Work is ongoing to build and test the solution and to begin carrying out change management activities with departments and agencies.

In 2025 to 2026 and 2026 to 2027, PSPC, in collaboration with its partners, will focus on finalizing the building and testing of the Dayforce solution. In parallel, essential change management activities will be undertaken to support departmental, operational, and enterprise readiness for a potential deployment.

On August 21, 2025, the acquisition of Dayforce by Thoma Bravo, a private equity firm specializing in software investments, based in the United States, was announced. The existing contract between the Government of Canada and Dayforce, which was amended on March 31, 2025, remains valid. The solution is hosted in Canada and all the resources who work on the contract directly require Canadian clearances or equivalent. The contract also requires that all data be stored in Canada. Dayforce reaffirmed its commitments to the Government of Canada and emphasized that the acquisition would not affect the existing partnership, service delivery, or contractual obligations.

Since the launch of Phoenix, PSPC has implemented a series of measures focused on stabilizing the administration of pay. We have also focused on other operational priorities in pay administration including parental leave, disability management, terminations, and overpayment recovery. We have improved service standard compliance while managing sustained increases of transactions submitted to the Pay Centre by departments and agencies. PSPC is looking at AI to further automate case processing. AI will play a key role in managing transactions at the Pay Centre, and it will help to process transactions faster, with greater efficiency and accuracy. As part of its work on AI, the GC is committed to its ethical and transparent use. As such, we have established an AI Advisory Committee and an AI Operational Ethics Review Board. We are also taking a proactive approach to transparency by publicly sharing updates on our AI activities and achievements.

In addition, the Automated Benefit Enrollment initiative is a multi-phase project designed to streamline and automate benefits enrollment. By reducing manual processes, this initiative allows compensation advisors to focus on complex transactions across the Government of Canada.

Update on the inventory and “one year plus” backlog:

Note: As of April 23, 2025, the total number of transactions ready to be processed no longer includes the 4 financial transaction types repatriated by Employment and Social Development Canada (ESDC) in fall 2018 (at their request). This change to reporting provides a more accurate reflection of the Pay Centre’s active workload, since ESDC is responsible for this processing. It represented a total of 25,000 transactions, which explains the large decrease observed this month in the total volume of transactions ready to be processed, along with transactions received over 1 year ago.

Procurement

Outsourcing of professional services

Issue

Public Services and Procurement Canada is working to ensure that external resources are used to provide only those services that are better and more economically delivered by the private sector.

Key facts

Key messages

Background

Parliamentary inquiries, audits of the Office of the Auditor General and reviews of the Office of the Procurement Ombud (OPO) on federal government spending on professional services contracts have generated negative media attention and have raised concerns about taxpayer dollars that are spent on professional services.

In addition to the policy direction issued by the Treasury Board of Canada Secretariat in October 2023 in The Manager’s Guide: Key Considerations when Procuring Professional Services, PSPC has taken action to strengthen existing controls and has implemented measures to ensure proper oversight of public funds, clear accountability and documented decision-making.

Over the past decade, government expenditures on professional services have remained consistent relative to both total government expenditures and to the total payroll for public servants.

PSPC is monitoring its professional services spending and is looking to reduce spending in management consulting and business services. It expects to report decreases in these areas for fiscal year 2025 to 2026.

As the department moves into ground-breaking on major infrastructure projects, the use of specialized resources (i.e., construction and engineering and architectural services) can be expected to rise. The department is seeing a reduction in the use of external resources in other categories, such as IT services and management services, and pivoting to the use of in-house resources wherever possible.

Fraudulent billing

Issue

The Government of Canada is pursuing efforts to investigate and deter fraudulent billing by individuals working as subcontractors on federal professional services contracts.

Key facts

Key messages

Background

Since March 2024, PSPC disclosed 9 cases of fraudulent billing by professional services subcontractors (i.e., individuals who were subcontracted) who were employed by prime contractors that held multiple contracts with a number of federal departments and agencies. These cases have been referred to the RCMP (Royal Canadian Mounted Police) for criminal investigation:

PSPC has a robust fraud risk management framework in place to prevent, detect and respond to wrongdoing in order to safeguard the integrity of the federal procurement system. This approach includes the use of a variety of tools to actively detect fraudulent activity and respond to alleged misconduct that the Government of Canada is being defrauded in either a specific contract or on a broader scale. To date, several actions have been taken to reinforce the capacity to detect and deter overbilling fraud schemes, and PSPC is actively working on implementing further measures.

PSPC employs active measures to raise awareness among procurement officers on how to identify potential instances as well as the use of data analytics and tips from the public to identify potential instances of fraud and wrongdoing. In order to respond to alleged instances, the department has an investigatory capacity to examine allegations that the Government of Canada is being or has been defrauded within its procurements.

The focus of PSPC’s administrative investigations have been on the illegitimate billing practices of subcontractors, not the prime contractors. That said, Canada has provisions in its contracts to recover these illegitimate payments and is working with the impacted prime contractors to recover these funds.

Office of Supplier Integrity and Compliance

Issue

The Office of Supplier Integrity and Compliance supports the Government’s ability to identify suppliers of concern and take appropriate action to mitigate the risk they pose.

Key facts

Since launching on May 31, 2024, and as of October 20, 2025, the Office of Supplier Integrity and Compliance has provisionally suspended 5 suppliers, suspended 4 suppliers, and declared 12 suppliers to be ineligible.

Key messages

Background

The Office of Supplier Integrity and Compliance (OSIC), launched in May 2024, replaced the Government of Canada’s Integrity Regime that had been in place since 2015 as a government-wide, policy-based debarment system. It is designed to mitigate the risk of conducting business with suppliers of concern by excluding them from being awarded contracts, as opposed to being punitive which is the role of the criminal justice system.

OSIC plays a significant role in safeguarding the federal procurement and real property systems, which encompasses approximately $20 billion annually for contracts, real property agreements, the management of Crown-owned properties, and rental payments on lease contracts across Canada.

Under the updated Ineligibility and Suspension Policy (the Policy), changes have been introduced to enable OSIC to better mitigate risks posed by suppliers of concern. Triggers for suspension or debarment have been expanded to include a wider range of procurement integrity-related issues such as:

The updated Policy accords flexibility to determine appropriate periods of ineligibility, up to a maximum of 10 years, based on an assessment of aggravating and mitigating factors. This ensures OSIC’s responses are commensurate with the conduct and risk posed by the supplier.

OSIC actively monitors current events for allegations of supplier misconduct through research, information sharing, and data analytics. OSIC exercises due diligence and procedural fairness when assessing suppliers, and apply administrative safeguards to allow for independent decision making while taking action when the Policy is triggered.

Increasing Indigenous involvement in Procurement

Issue

Public Services and Procurement Canada, in partnership with Indigenous Services Canada and the Treasury Board of Canada Secretariat, are actively working to increase the participation of Indigenous businesses in federal procurement.

Note: All questions regarding the Indigenous Business Directory, verification of indigeneity and alleged cases of Indigenous misrepresentation should be directed to Indigenous Services Canada.

Key facts

Key messages

Background

On August 6, 2021, the Government of Canada announced a mandatory requirement for federal departments and agencies to ensure that a minimum of 5% of the total value of contracts are held by Indigenous businesses by 2024 to 2025. The announcement included Canada’s commitment to continue meaningful engagement to co-develop a longer-term transformative approach to Indigenous procurement and to increase the capacity of Indigenous-owned businesses to compete and receive more federal procurement contracts.

PSPC did not achieve its 5% target commitment in the 2023 to 2024 fiscal year; however, concrete actions are being taken to help increase Indigenous business participation in federal procurement, including developing Indigenous Participation Plans to boost subcontracting with Indigenous businesses and provide employment and training opportunities for Indigenous Peoples; applying Indigenous-by-default measures to consider Indigenous participation in all procurements; using limited bidding among prequalified Indigenous offerors; updating supply methods to include Indigenous businesses; structuring and unbundling projects to enable competitive Indigenous bids; and incorporating weighted Indigenous criteria in bid evaluations. PSPC also continued to increase awareness of federal procurement opportunities through its outreach and engagement activities.

Annex - Indigenous Involvement in Procurement

Issue

Public Services and Procurement Canada (PSPC) is committed to economic reconciliation with Indigenous peoples, and is working with Indigenous Services Canada and the Treasury Board of Canada Secretariat to increase Indigenous participation in federal procurement to, among other objectives, meet the government-wide mandatory minimum target of 5% of the total value of federal procurement awarded to Indigenous businesses annually.

Action taken to date

PSPC has taken a number of steps to increase Indigenous participation in procurement such as developing tools and guidance for procurement officials.

This includes the development of new procurement clauses:

The clauses are available for use on procurements that seek to increase Indigenous participation. Upon contract award, the bidder’s IPP commitments become part of the contractual deliverables and create obligations for the supplier.

Contracts awarded using the LIO clause or the subcontracting component of IPP-based contracts count toward the mandatory minimum 5% Indigenous procurement target (5% Target).

IPPs can include employment or skills development as may be required by Comprehensive Land Claim Agreement obligations or in response to local Indigenous priorities. While these criteria do not count toward the 5% target, they represent meaningful steps toward economic reconciliation with Indigenous peoples.

To support the use of IPPs, PSPC is in the process of developing an IPP template that will help standardize IPP commitments and how they are evaluated.

Additional innovative approaches are being put forward to accelerate the progress in increasing opportunities for Indigenous participation in federal procurement.

Timelines for completion

The clauses are available as of July 2024, and the IPP template will be launched by the end of 2025.

Costs (to date and projected)

No associated costs to date.

Legislative requirements

This initiative will not require legislation.

Buy Canadian

Issue

On September 5, 2025, the Prime Minister announced an expanded Buy Canadian Policy to strengthen domestic industries and ensure federal spending benefits Canadian businesses.

Key facts

Key messages

If pressed on the value and volume of US contracts:

Background

On September 5, 2025, the Prime Minister announced an expanded Buy Canadian Policy that introduces a suite of new measures to prioritize Canadian suppliers, materials, and innovation across federal procurement and funding programs, amongst other measures to protect, build and transform Canadian strategic industries.

Public Services and Procurement Canada is developing a Buy Canadian Procurement Policy Framework, which encompasses a number of new measures, including:

Vendor Performance Management System

Issue

Vendor Performance Management is used within Public Services and Procurement Canada and its client departments to assess vendor performance and use past vendor performance information in awarding contracts.

Key facts

Key messages

Background

Public Services and Procurement Canada (PSPC) had already begun developing a VPM system as part of its efforts to modernize federal procurement and strengthen the system's performance.

In its new report on knowledge development and sharing, the OPO proposes 5 key solutions to address persistent systemic issues in federal procurement. These include the implementation of a VPM system. The VPM initiative, which has been underway for a few years now, responds to recommendations made by the OPO.

The first phase of the VPM applies to PSPC goods and services contracts for PSPC valued at more than $100,000, excluding those using a standing offer or supply arrangement. Vendors will be evaluated on such things as how well they respect timelines, incidents of consultant turnover and invoicing accuracy. Scores are not yet used in vendor selection. The next few months will be used to test the system and gather feedback. Vendors will be given a 90 day notice before scores are considered.

Program development was supported by extensive consultations with other levels of government, sector and regional buyers, vendor associations and legal services. Should the decision be made to expand it to other departments, adjustments will have to be made to the e-procurement solution. PSPC is currently working to expand the program for all contracts over $100,000, including those managed for other departments as part of its common service provider role.

Master Level User Arrangements

Master Level User Arrangements (MLUAs) provide direction to departments and agencies on responsibilities associated with the use of the mandatory Methods of Supply (MOS) supply arrangements. The professional service methods of supply covered by the new MLUAs are as follows:

They are agreements between PSPC, as issuer and administrator of the MOS, and clients departments and agencies, as users of the suite of supply arrangements. All clients must have signed an MLUA to become an authorized user prior to using any of the mandatory MOS.

Background

On November 28, 2023, after finding evidence of the misuse of the mandatory MOS, PSPC invalidated all existing MLUAs and temporarily suspended clients’ authority to issue their own task authorizations under these instruments, pending signature of a revised MLUA.

Action taken to date

Revised MLUAs to replace those that were invalidated were developed, issued and signed. The new MLUAs formalized many of the required changes identified in the November 28, 2023 directive, making them conditions of use when accessing PSPC’s supply arrangements. Changes include, but are not limited to:

This initiative has been completed. In spring 2024, client departments and agencies signed the new MLUAs, and PSPC now manages 100 arrangements with authorized client departments and agencies.

Changes in Procurement Services in Response to the Procurement Ombud’s and Auditor General’s reports

Issue

On November 2, 2022, a motion was passed by the House of Commons that called on the Office of the Auditor General of Canada to conduct a performance audit on ArriveCAN, including on contracts and subcontracts, as well as payments under those contracts.

Reports resulting from a review carried out by the OPO and an audit conducted by the Office of the Auditor General (OAG) were tabled on January 29, 2024, and February 12, 2024, respectively. The reports highlight serious concerns regarding project management and offer recommendations pertaining to procurement, specifically with regard to professional services.

Key facts

Key messages

If pressed on immediate actions that PSPC is taking to strengthen existing controls and oversight for professional services contracting:

If pressed on the actions being taken in response to the Auditor General report:

If pressed on the actions being taken in response to the Procurement Ombud’s review:

If pressed on indigenous contracting:

Background

Under its authorities, PSPC awarded contracts in support of ArriveCAN and was responsible for providing procurement guidance to the client department. The CBSA was responsible for developing and managing the ArriveCAN tool based on the Public Health Agency of Canada’s health requirements enforced by the Quarantine Act.

A total of 46 different contracts were used in support of ArriveCAN. Of these 46 contracts, 31 were awarded by PSPC under its authorities:

On November 14, 2022, the House of Commons Standing Committee on Government Operations and Estimates adopted a motion recommending that the Procurement Ombud conduct a review of contracts awarded in relation to the ArriveCAN application.

On January 13, 2023, the Office of the Procurement Ombud determined that there were reasonable grounds to launch a review of procurement activities associated with the creation, implementation and maintenance of ArriveCAN.

In light of the findings of the review and audit, PSPC took immediate action to strengthen existing controls around the administration of professional services contracts. On November 28, 2023, other government departments and agencies were informed of new measures, introducing a common set of principles and mandatory procedures that clients must abide by to use PSPC’s professional services contracting instruments.

These changes closely align with the recommendations in the OAG and OPO reports and are echoed in the resultant management action plans to which PSPC has committed.

Quotes from the Auditor General on contract changes and Procurement Changes Public Services and Procurement Canada has made post GCStrategies and McKinsey

Standing Committee on Public Accounts - Thursday, October 9, 2025

Stephanie Kusie: Mr. Hayes, your office's report on professional services speaks to a clear disregard for the rules, notably from McKinsey. This is something that we have also seen repeated in other reports, specifically the June 2025 report on GC Strategies.

Why do you think federal departments and Crown corporations have not felt the need to comply with the rules?

Andrew Hayes: Thank you for the question.

Of course, our audit of McKinsey and our audit of the professional services contracts to GC Strategies covered the same period. It's not surprising to us that we would've found similar weaknesses. In fairness, I think it's possible that those exist elsewhere in the public service as well. What we're hoping comes from the recommendations that we made in previous reports, the one that we make here, in terms of conflict of interest, and the ones that have been made by the internal audit shops and the Controller General is that by strengthening the controls about why contracts are being selected or being put in place, why public servants cannot do it, why a contract is needed, of course, why selection of a particular contractor has been made and, at the end of the day, the deliverables that have been achieved, I am hoping that by implementing stronger documentation and controls around that, we will see better processes, better approaches and better value for money.

Stephanie Kusie: Do you think PSPC, under their mandate as the central purchasing and contracting agent of the federal government, should exercise more pushback in power when departments try to evade contracting rules or manipulate the rules?

Andrew Hayes: I was really encouraged to hear the response from the deputy minister earlier about how our audit has supported the experts in her organization. I want to emphasize that there are experts in her organization to pushback and to identify and support departments in the proper application of rules and also in the strategies that they select for contracting. I think that's a very positive outcome. I'm thankful that we were able to support that.

Stephanie Kusie: Your report takes specific aim at chains of non-competitive contracts.

Do you believe the government currently has the tools to address issues found under these chains of contracts?

Andrew Hayes: What we expect is that the government will follow its policies to support competitive and transparent procurements. In terms of the chains that we found, a decision was made, in some cases non-competitively and in other cases competitively, to issue a first contract. What should happen after that is a similar assessment of whether or not competitive procurement should be applied to open it up to other suppliers. As we've heard from some of the other witnesses, that's the way that you get to the best value for money for Canadians.

Stephanie Kusie: Across 85% of departments and Crown corporations reviewed for this audit, you found frequent disregard for one or multiple stems of procurement rules. How is it possible that this level of non-compliance is so persistent across our federal government?

Andrew Hayes: Again, that takes us back to the pervasiveness in our findings both in this and the GC Strategies audit of areas that can be improved. I'm hopeful that with the additional attention on both the procurement process and conflict of interest requirements—I want to highlight the importance of proactively with conflict of interest declarations specific to procurement—that we will find tighter and more transparency in these procurement processes.

Stephanie Kusie: After completing these audits, who do you ultimately view as accountable for ensuring the rules are followed? Would it be the minister?

Andrew Hayes: I would say that every deputy minister and every chief executive officer of the Crown corporations are responsible for making sure procurement processes are followed in their organization and they can be accountable for the spending of taxpayer money.

Standing Committee on Government Operations and Estimates – October 21, 2025

Alexander Jeglic, Procurement Ombud: As I'm sure we are all aware a new agency was created, we had a specific focus on defence procurement. That new agency will form part of our mandate. So those procurements will be subject for review from the office. What I think is an overt positive is it's a recognition that things need to be done differently. So we have spoken about the need for foundational changes. I think the recognition of creating a separate agency for defence procurement recognizes things were not working effectively. And we would echo that sentiment. But what I don't want is for the rest of the procurement universe to be left behind because while we focus on defence procurement as a priority, the procurement universe will still exist, and so my hope is that many of the changes being thought about in defence procurement will equally be thought through as a whole environment to ensure that the positive changes reflect all of that.

Alexander Jeglic: In essence I did want to respond to one part of your first comment which was about good practices seen in the report as well, and what I will say was a true marked different between what we saw in ArriveCAN in this report was the state of documentation. So there was a lot of inferences that had to be drawn when we were doing reviews specifically in ArriveCAN because the documentation was not at the quality as expected -- ArriveCAN. As a result of many highlighted issues and concerns, including recommendations from our office, the documentation in almost all of the files was excellent. And that might not seem like a significant takeaway but it really is from an accountability and transparency standpoint. I don't want that to be lost from the report. That was certainly a good practice. In terms what have the departments themselves did, in relation to some of the recommendations, that also was highlighted in the report. There were, in fact, good practices associated with the work of the departments we. We highlighted an example of PSPC and ESDC working in tandem to ensure contract award that there was a confirmation of the resources and their availability which we identified as a good practice. And then further we noted a good practice replacement of resources was substandard. And It was the department that took proactive measures to ensure that those resources were replaced with effectively better resources than those that were being provided. And we did want to highlight those because we think those are great examples.

Alexander Jeglic: So the biggest change, and Kelly can jump in and correct anything I'm saying, but the biggest change was where it was large task-based contracts with multiple resources could no longer identify -- could no longer assess the individual characteristics of the resource but would now evaluate the corporate entity and the past experiences and past performance of that corporate entity. And that's probably the most significant change. And so you will see part of the report in this section actually speaks to definitions, right. So when you use the term "large" what does "large" equate to. We were probing each department subjected to the review to see how have you interpreted “large”. And have you mitigated the concern. What we saw in 3 of the 5 mitigation measures and that would align themselves with this shift and 2 were still kind of working through this definition of "large" and you will notice one of the recommendations we made for PSPC to provide this term and provide for standardization. If you may get on the pulpit for one more second. Standardization is also something that is sorely lacking in procurement and there are 2 schools of thought about individualization versus standardization. But I can tell you that suppliers often don't just sell to one singular department. They sell to multiple departments. They sell to multiple jurisdictions. So the more standardized the process, the more cost effective the whole process is, meaning they don't have to spend inordinate amounts of time preparing their proposal because certain terminology is static. So they know what to expect. When they have to hire a proposal writer, hire a legal advisor, you know in order to facilitate responding to a federal opportunity, that immediately limits the pool of available suppliers that are likely to participate in that process.

Auditor General of Canada 2024 Report 5 - Professional services contracts

5.9 Office of the Procurement Ombud review. The Minister of Public Services and Procurement requested that the Office of the Procurement Ombud review the procurement practices that federal departments and agencies used to acquire services through contracts awarded to McKinsey & Company. This review was made public on 15 April 2024. The Office of the Procurement Ombud does not have the authority to review procurement practices of Crown corporations.

5.10 The several audits and reviews requested by the Comptroller General of Canada, the President of the Treasury Board, and the Minister of Public Services and Procurement between March 2023 and March 2024 found numerous administrative and procedural weaknesses in the management of procurements. These included, for example, failing to obtain a signed contract before work began or failing to maintain relevant contracting documents on file. While these weaknesses did not affect the decision to issue a contract to McKinsey & Company or increase risks to achieving value for money, which are the focus of this report, they demonstrated weaknesses in administering the procurement process

2025 Reports of the Auditor General of Canada – Message from the Auditor General of Canada

Throughout the past 5 years, we have found Canada’s federal public service is made up of many resourceful individuals who are dedicated to improving the lives of current and future generations. I echo my predecessors who have said in various ways that the Canadian public service is a world‑class institution that should be a source of pride. While our audits of government operations have put the spotlight on specific shortcomings, more often than not we have seen how public servants respond to challenging events with professionalism, resilience, and ingenuity.

The urgency and gravity of the COVID‑19 pandemic, for instance, pushed federal organizations to pivot away from a rigid adherence to fixed rules to a mindset that prioritized helping Canadians quickly. Because lives were at risk, that sometimes meant federal organizations undertook sequential steps concurrently or even postponed some standard checks and balances. Though there were some missteps, the ability of public servants to work differently during the pandemic—to learn, change, and course‑correct in real time—demonstrated what can be accomplished by, what I call, a service mindset.

Procurement will remain a critical area for OAG audits. The stakes are rising exponentially as large‑scale purchases of defence equipment and major infrastructure and energy projects are coming to the forefront. Future audits will assess whether procurement practices are transparent, competitive, aligned with operational needs, and providing value for money.

Defence

Defence Investment Agency

Issue

The Government of Canada has created a new Defence Investment Agency to modernize defence procurement.

Key facts

Key messages

If pressed on ties to economic impact:

If pressed on defence spending:

Background

Until now, defence procurement in Canada has been divided across multiple ministers and accountabilities, and layers of oversight from central agencies. To meet the Government’s commitment to accelerate spending on defence, reforms to defence procurement are needed. The Defence Investment Agency will centralize accountability, leverage expanded authorities and introduce flexibilities in the procurement process to deliver faster procurement outcomes.

Reforming defence procurement has been the subject of several reports and studies. The Standing Committee on National Defence tabled a wide-ranging report (June 2024) entitled, A Time for Change: Reforming Defence Procurement in Canada. In December 2024, the Auditor General of Canada tabled a report on the application of Industrial and Technological Benefits to defence procurements, noting areas for administrative improvements, and will be tabling a report on Canada’s Future Fighter Jets in Spring 2025. The Parliamentary Budget Officer has recently released reports on the incremental cost of procurements such as the Polar Icebreaker Project and the F-35s.

Replacing the Canadian patrol submarines

Issue

Canada has identified German company Thyssenkrupp Marine Systems (TKMS), and Korean company, Hanwha Ocean Co., Ltd. (Hanwha), as the 2 qualified suppliers for the Canadian Patrol Submarine Project.

Key facts

Key messages

Background

Through Canada’s defence policy, Our North, Strong and Free, the Government of Canada is providing members of the Royal Canadian Navy with the equipment they need to maintain current and future operational readiness.

Canada’s key submarine capability requirements will be stealth, lethality, persistence and Arctic deployability – meaning that the selected submarine must have extended range and endurance.

Through the Canadian Patrol Submarine Project, Canada will acquire a larger, modernized submarine fleet that will provide a unique combination of these capabilities to ensure that Canada can detect, track, deter and, if necessary, defeat adversaries in all three of Canada’s oceans while contributing meaningfully alongside allies and enabling the Government of Canada to deploy this fleet abroad in support of our partners and allies.

The Government of Canada remains committed to engaging Canadian industry and creating high-paying jobs at home through the Canadian Patrol Submarine Project. As such, Canada intends to leverage work on the submarines to generate economic benefits for Canada’s marine and defence industry throughout the fleet’s operational life.

Procurement of Canadian F-35 jets

Issue

In December 2017, the Government of Canada launched an open and transparent competition to permanently replace Canada’s fighter fleet with 88 advanced jets—the Future Fighter Capability Project.

Note:

Key facts

The project is estimated to be $27.7 billion, which includes associated equipment, initial weapons and ammunition, sustainment set-up and services, as well as the construction of Fighter Squadron Facilities (Cold Lake, Alberta and Bagotville, Quebec)

Key messages

Background

As part of its defence policy, Our North, Strong and Free, the Government of Canada has renewed its commitment to procure 88 advanced fighter jets for the Royal Canadian Air Force.

An independent fairness monitor oversaw the entire competitive process to ensure a level playing field for all bidders. An independent third-party reviewer was also engaged to assess the quality and effectiveness of the procurement approach.

On January 9, 2023, the Government of Canada announced that following an open, fair and transparent competition, Canada had finalized an agreement with the United States government and Lockheed Martin with Pratt & Whitney for the acquisition of F-35 fighter jets for the Royal Canadian Air Force.

On November 25, 2024, the Government of Canada announced that Canada has identified L3Harris MAS from Mirabel as its strategic partner. The company will collaborate with the Canadian government and the F-35 Joint Program Office to explore the requirement for an air vehicle depot.

On March 14, 2025, the Prime Minister asked the Minister of National Defence (MND) to review the planned acquisition of the F-35 aircraft; the review is led by the Department of National Defence with input from key project stakeholders. The Independent Review Panel for Defence Acquisition will also provide separate advice to the MND. It is anticipated that this review will be finalized by end of September 2025.

The Office of the Auditor General of Canada has completed its Performance Audit of Canada’s Future Fighter Capability Project. The report was tabled in Parliament on June 10, 2025. Key findings include significant cost increases, infrastructure delays, Royal Canadian Air Force pilot shortages and project management gaps.

National Shipbuilding Strategy

Issue

The National Shipbuilding Strategy is a long-term commitment to renew the vessel fleets of the Royal Canadian Navy and Canadian Coast Guard, create a sustainable marine sector, and generate economic benefits for Canadians.

Note: All questions related to budget, requirements, timelines, international comparisons, and project management should be directed to the Minister of National Defence

Key facts

Key messages

If pressed on the River-class Destroyer Project:

If pressed on the Polar Icebreakers:

Background

The National Shipbuilding Strategy is a long-term plan to renew the Royal Canadian Navy and Canadian Coast Guard fleets. It aims to eliminate the boom and bust cycles of vessel procurement that have slowed Canadian shipbuilding in the past. Canadian shipyards involved are Irving Shipbuilding in Nova Scotia, Vancouver Shipyards in British Columbia and Chantier Davie in Quebec.

The River-class Destroyer Project Implementation contract outlines the terms and conditions for the construction and acceptance of the first 3 ships. Proceeding in batches provides Canada with flexibility to adapt to technological advancements, address evolving operational requirements, and respond to emerging threats. This approach helps ensure that the fleet will remain modern and capable throughout its lifecycle.

As part of the Definition contract, the River-class Destroyer Project is presently in the third of 4 design stages As design completion progresses in parallel with construction, Canada’s Definition contract and Implementation contract with Irving Shipbuilding will be open concurrently for a period of time.

On March 7, 2025, Seaspan’s Vancouver Shipyards was awarded a $3.15-billion contract (excluding taxes) to build one polar icebreaker. On March 8, 2025, Chantier Davie Canada Inc. was awarded a $3.25-billion contract (excluding taxes) to build the other polar icebreaker.

The Davie icebreaker will be built using a hybrid domestic-international build strategy, with work split between Davie’s facilities in Quebec and its Finnish shipyard. With the evolving global climate, it is essential more than ever that Canada delivers ships to the Canadian Coast Guard in a timely manner so they can continue to work to protect Canadian sovereignty and security.

The National Shipbuilding Strategy continues to evolve and will be strengthened by the Icebreaker Collaboration Effort (ICE) Pact, a partnership between Canada, Finland, and the United States that was signed into effect in November 2024. This collaboration seeks to accelerate Arctic and polar icebreaker production, boost the marine industries of all 3 nations, and enhance technical cooperation and information sharing to meet global demand for icebreakers. For Canada, the ICE Pact presents new opportunities for the shipbuilding sector by leveraging shared expertise and capabilities developed under the National Shipbuilding Strategy (NSS), while promoting a key role for Canadian shipyards and supply chains.

Annex - National Shipbuilding Strategy

Issue

Canada’s National Shipbuilding Strategy (NSS) is a long-term plan to renew the fleets of the Royal Canadian Navy (RCN) and the Canadian Coast Guard (CCG), create a sustainable marine sector, and generate economic benefits for Canadians. The NSS is focused on 3 pillars: 1) Construction of large vessels (more than 1,000 tonnes of displacement); 2) Construction of small vessels (less than 1,000 tonnes of displacement); and 3) Vessel repair, refit and maintenance projects.

Under the first NSS pillar, the Government of Canada is having large vessels built at Irving Shipbuilding Inc. (ISI) in Halifax, Nova Scotia, Seaspan’s Vancouver Shipyards Co. Ltd. (VSY) in Vancouver, British Columbia and Chantier Davie Canada Inc. (CDCI) in Lévis, Quebec. ISI and VSY were selected in October 2011, and CDCI was selected in April 2023, following open and fair competitive processes.

Action taken to date

As of September 2025, Canada has awarded approximately $54 billion in contracts under the NSS to businesses across the country and, of these, $1.19 billion went to small and medium businesses with less than 250 employees.

NSS contracts awarded between 2012 and 2024 are estimated to contribute close to $38.7 billion ($2.8 billion annually) to Canada’s gross domestic product and to create or maintain approximately 21,400 jobs annually over the 2012 to 2025 period.

So far, 9 large vessels and more than 34 small vessels have been delivered and many more are under construction. In addition, more than 300 ships have undergone repair, refit and maintenance work and others are underway at various shipyards across Canada.

Since the inception of the NSS, Canada has faced a variety of challenges and continues to mitigate risks associated with cost escalation and schedule slippage, most prevalent with Pillar 1 – Large Vessel Construction. To address these challenges, including schedule delays, supply chain disruptions, workforce shortages, rising costs, and geopolitical tensions, the government has:

Timelines for completion

Key milestones for NSS large vessel projects include:

ISI – Completed:

ISI – Upcoming:

VSY – Completed:

VSY – Upcoming:

CDCI – Upcoming:

Costs (To date and projected)

ISI is responsible for the construction and delivery of 23 large vessels under the NSS, with an estimated total budget ranging from $63.08 billion to $67.08 billion and $22.2 billion in awarded contracts to date (as of September 2025).

VSY is responsible for the construction and delivery of up to 23 large vessels under the NSS, with an estimated total budget of $22.36 billion and $12.44 billion in awarded contracts to date (as of September 2025).

CDCI is responsible for the construction and delivery of 9 large vessels under the NSS. The total project budget is TBD, with $3.81 billion in awarded contracts to date (as of September 2025):

Legislative requirements

The NSS is a long-term strategic sourcing plan that is accomplished within the existing legislative framework. Three pieces of legislation of particular importance to enabling the NSS are the Defence Production Act (DPA), the Department of Public Works and Government Services Act (DPWGSA) and the Financial Administration Act (FAA).

Real Property

Optimizing the Office Portfolio

Issue

Public Services and Procurement Canada will continue to provide sufficient, functional office space to accommodate federal public service employees while it optimizes the space under its responsibility and reduces operating costs.

Key facts

Key messages

If pressed on further office space reductions:

If pressed on use of the Full-Service Workplace (Space as a Service) Contract – awarded to LAUFT

Background

PSPC continuously reviews its use of public funds to provide efficient work environments for federal public servants. The funding announced in Budget 2024 will enable PSPC to plan and undertake strategic workplace enhancements, support the transition to unassigned workstations, and facilitate decommissioning of certain workplaces and client moves into existing or new office space.

PSPC is responsible for making decisions about quality, quantity, and location of space, while also providing accommodation solutions that respond to federal public service employee requirements and ensure best value for money. We have already identified ways to optimize our leased and owned space, including by using shareable spaces and co-locating federal departments and agencies, and accelerating the disposal of surplus assets.

PSPC is currently working with federal departments and agencies to establish their long-term accommodation requirements. The ongoing reduction of the real property portfolio, which began during the pandemic, will continue over a period of 10 years.

The growth in the number of federal employees and the updated Directive on Prescribed Presence in the Workplace (3 to 4 day per week in office presence) has brought projected space savings down to approximately 33% over the ten-year period, with associated operations and maintenance savings of approximately $2.45 billion over this period.

PSPC works with Shared Services Canada to ensure that office spaces are equipped with the necessary tools for employees, including internet connectivity.

Build Canada homes

Issue

Public Services and Procurement Canada is collaborating with Housing, Infrastructure and Communities Canada and the Canada Lands Company to accelerate the conversion of public lands for housing across the country.

Key facts

Key messages

Background

Budget 2024 aimed to unlock 250,000 units by leveraging surplus and underutilized public lands across the country by 2031.

Public Services and Procurement Canada has facilitated the disposal of federal lands by launching the Canada Public Land Bank website, the Government of Canada's official online inventory of surplus and underutilized federal properties. There are currently 91 properties listed, representing the potential for approximately 42,500 housing units on a total of 473 hectares of land across Canada.

To accelerate early results for Build Canada Homes, Public Services and Procurement Canada is piloting a new approach for speeding up housing development. The department is proposing to sell 2 surplus land parcels at Tunney’s Pasture in Ottawa, Ontario to developers with proven experience and capacity willing to commit to building housing.

The objective of the pilot is to see if a competitive request for proposal process can help build high-density housing faster. The pilot is targeting a minimum of 200 units built within 3 years, starting in April 2026.

The pilot is an example of transformation being explored by Public Services and Procurement Canada to provide Build Canada Homes with a consistent pipeline of federal properties for affordable housing.

Other

Status of the Long Term Vision and Plan for the Parliamentary Precinct

Issue

Public Services and Procurement Canada is implementing the Long Term Vision and Plan, a multi-decade strategy to restore and modernize the Parliamentary Precinct.

Key facts

Key messages

Background

The 2025 Long Term Vision and Plan will guide decision making and planning in the Parliamentary Precinct over a 50-year horizon. It consists of a renewed vision and set of guiding principles, as well as 9 frameworks that focus on enhancing campus security and improving parliamentary infrastructure to create a modern, integrated and secure campus that is welcoming to all. The new Long Term Vision and Plan was developed with extensive input from the Parliamentary Administrations, public opinion research, the National Capital Commission, Indigenous partners, and the City of Ottawa. Key priorities underway include the rehabilitation of the Centre Block, construction of a new Parliament Welcome Centre and the redevelopment of Block 2.

Centre Block Rehabilitation Program

Work is underway to restore and modernize the Centre Block and construct the Parliament Welcome Centre. Design development for the Centre Block, Parliament Welcome Centre, and landscape is complete, with construction now focused on structural build. The current project scope, market influences, and the tariff environment have put unrealized cost pressure on the program. Active work is underway with the Parliamentary Administrations to contain costs without impact to core parliamentary requirements.

Block 2 Redevelopment

The rehabilitation and modernization of Block 2 will transform obsolete heritage buildings into modern, sustainable, accessible and permanent facilities for Parliament. It will also enable key buildings, such as Confederation, to be emptied and restored. Schematic design will be completed in fall 2025 and construction efforts are now focused on building demolition and abatement, as well as heritage façade protection.

A National Space for First Nations, Inuit, and Métis Peoples

PSPC continues to support Crown-Indigenous Relations and Northern Affairs Canada, National Indigenous Organizations and the Anishinàbe Algonquin Nation to advance work on a National Space for First Nations, Inuit and Métis Peoples and the dedicated Algonquin space, as announced in 2017 by the former Prime Minister. Agreements are currently in place with National Indigenous Organizations and the Anishinàbe Algonquin Nation to advance these spaces. Crown-Indigenous Relations and Northern Affairs Canada is the federal lead and Public Services and Procurement Canada continues to support on the design and construction.

Wellington Street

Formal discussions with the City of Ottawa on acquiring Wellington Street were launched in April 2023 and remain ongoing. To date, negotiations have not resulted in agreement on fair and justifiable compensation between federal and municipal governments. Acquiring Wellington Street is a key enabler to a balanced approach to enhancing security, while maintaining openness to the public in the Parliamentary Precinct.

Procurement of Official Languages interpretation services

Issue

The Translation Bureau’s interpretation services are essential to the functioning of the House of Commons, the Senate and their respective committees.

Key facts

Key messages

If pressed on capacity:

If pressed on the health and safety of interpreters:

If pressed on the impact of choosing the lowest bidder on interpretation quality:

If pressed on the proposal to switch from daily to hourly rates:

Background

The Translation Bureau uses suppliers for approximately 40% of its demand for official languages interpretation in Parliament, and 80% for assignments outside Parliament. Although one-off contracts are occasionally employed, it mainly uses open solicitations.

In the summer of 2024, PSPC proposed an amendment to its contract with suppliers. The proposal was poorly received by many suppliers. PSPC acknowledged that it had lacked clarity in its communications about the amendment and offered suppliers a revised version of the contract that did not contain the amendment in question. The current contracts are in place until December 31, 2025.

The Request for Information launched by PSPC at the end of June 2025 closed on August 8, 2025. Nearly 50 suppliers submitted feedback that was taken into account in the preparation of the Request for Standing Offer, which will be issued shortly.

Auditor General’s Report 7: Combating Cybercrime

Report 7—Combating Cybercrime

Shared Services Canada

Artificial intelligence

Issue

Artificial intelligence (AI) is considered a foundational technology, which stands to propel significant social and economic change. SSC is exploring how to use new technologies like AI to support government work.

Key facts

n/a

Key messages

If pressed on jobs:

If pressed on implementation:

If pressed on sovereignty:

Background

To guide the responsible use of AI, TBS released key resources, including the Directive on Automated Decision-Making, the Guide on the use of generative artificial intelligence and the Algorithmic Impact Assessment tool.

Digital sovereignty

Issue

Digital sovereignty ensures a country retains control over its digital infrastructure, data and critical technologies. This protects national security, supports economic competitiveness and allows the country to operate independently in the digital age. It includes:

Key facts

Key messages

If pressed on how SSC strengthens digital sovereignty:

Background

Due to the global dominance of US-based technology vendors and the comparatively small size of Canada’s IT sector, targeted interventions are essential to scale Canadian capabilities. Cloud computing, in particular, is dominated by Amazon Web Services, Google Cloud and Microsoft Azure, posing challenges to operational and technological sovereignty.

Advanced cyber threat actors are increasingly using supply chains to bypass traditional security defences by introducing vulnerabilities. Since 2012, SSC has mitigated this risk through Supply Chain Integrity procurement reviews for equipment, software and services. These assessments help departments and agencies to identify and potentially mitigate security vulnerabilities before they impact operations.

The GC has made strategic investments in Canadian IT firms, including a March 2025 announcement by Innovation, Science and Economic Development Canada of up to $240 million in funding for Toronto-based Cohere Inc. This investment marks Cohere as the first recipient of the AI Compute Challenge, part of the $2 billion Canadian Sovereign AI Compute Strategy. In August, the GC signed a Memorandum of Understanding with Cohere to explore opportunities for deploying AI technologies across the GC to enhance operations within the public service and to build out Canada’s commercial capabilities in using and exporting AI.

Cyber Security

Issue

The Government of Canada (GC), like all organizations worldwide, faces ongoing cyber threats from bad actors, on a national and international level, that require constant attention and strong security measures. Cyber threats are becoming more complex and sophisticated. These include criminal activities such as ransomware attacks and attacks by state-sponsored adversaries.

Key facts

Key messages

If pressed on supply chain integrity

If pressed on quantum computing

If pressed on small departments and agencies

Background

Cyber security is a shared responsibility across the GC:

The GC Cyber Security Event Management Plan outlines how different departments respond to cyber incidents. Smaller issues are handled by the affected department, while serious ones are managed by teams led by TBS and the Cyber Centre. SSC’s responsibilities during a cyber security event include watching for unusual network activity, blocking cyber threat activity, assessing service impacts, reporting through the Cyber Centre and implementing prevention, mitigation and recovery efforts, such as emergency patching and isolating infrastructure.

Auditor General Report: Canada Revenue Agency Contact Centres

Issue

In this report, the Auditor General found the Canada Revenue Agency’s (CRA) contact centres failed to consistently provide callers with accurate and timely information.

The report highlighted deficiencies in the management of the Hosted Contact Centre Service platform (HCCS) provided through a contract with SSC.

Key facts

Key messages

If pressed on new contract:

If pressed on value:

If pressed on cost conflation:

Background

In 2013, the Government of Canada made the decision to pursue a consolidated contact centre solution. In 2015, SSC awarded a contract to International Business Machines Corporation (IBM) for the HCSS system. It included new functions such as call routing to agents with relevant knowledge, nation-wide call queuing, an integrated voice-response system, estimated wait times and workforce management functionalities. The contract was designed to include many features that give the CRA and other departments the flexibility to choose and implement as their business requirements evolved over the life of the contract.

Auditor General Report: Cyber Security of Government Networks and Systems

Issue

On October 21, 2025, the Auditor General tabled a report on the cyber security of federal networks and systems. It found the government “had tools in place to defend” its networks and its cyber security plan was “sound and comprehensive.”

However, the report raised concerns about delays to key projects to improve visibility of cyber events and coordinate the response to incidents. It highlighted shortcomings in the management of equipment, and noted that certain SDAs were not using SSC cyber security services.

Key facts

Key messages

If pressed on the Global Affairs Canada (GAC) cyber attack “7 day” delay:

If pressed on cyber attack on GAC:

If pressed on Security Information and Event Management (SIEM):

If pressed on the Endpoint Visibility, Awareness, and Security (EVAS) project:

If pressed on vulnerability and patch management:

If pressed on SDA:

Background

The GC, like all organizations worldwide, faces ongoing cyber threats from bad actors on a national and international level that require constant attention and strong security measures. Cyber threats are becoming more complex and sophisticated. These include criminal activities such as ransomware attacks and attacks by state-sponsored adversaries.

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2026-02-26