The Canadian government has initiated a comprehensive review of its procurement contracts following a series of significant contracting problems in recent years. Since then, Finance Minister François-Philippe Champagne and Public Works and Procurement Minister Joël Lightbound have assumed command. They instructed leaders to review every existing and future contract to find cost savings. This small move comes in direct step to address the rising expenses associated with creation of the ArriveCan app. These costs jumped in the wake of the COVID-19 pandemic.
In fact, the federal government is the largest purchaser in Canada — it spends more than $66 billion per year on procurement. Its focus is on improving productivity and providing more value for taxpayers. Under the new directive, officials have a hard deadline of 45 days. Further, they need to produce a plan that prioritizes commercially available solutions from Canadian vendors. Prime Minister Mark Carney even released a more detailed plan to reduce federal operating expenditures. The plan includes a 15 percent cut to costs over the next three years.
Champagne emphasized the importance of the review, stating that it is essential for the government to “can spend less on operations and deliver better value for Canadians.” At the time, he described this effort as a “sea change.” It’s fundamentally about building a government that is more effective, more efficient, and better serving to the people’s needs.
The directive requires international best practices to be part of the process in contracting reviewing those practices. This was stated in the letter sent to the deputy minister of public services and procurement, chief information officer and other senior officials. Departmental officials in the Treasury Board and Shared Services Canada are already working on the details of this plan.
His call was echoed in July by Alexander Jeglic, the federal procurement ombud, who demanded nothing less than a complete overhaul of the government’s procurement system. He criticized the administration’s failure to address long-standing issues with federal procurement. Many of these issues have gone unresolved for decades.
The new strategic review is intended not just to look for savings but to make major improvements in the efficiency of government’s operations as a whole. By reassessing existing contracts and making more informed decisions about future procurements, officials hope to rectify persistent issues and ensure that taxpayer money is spent wisely.
Canada is in the thick of making these changes happen and for good reason. Their ultimate aim is to establish a procurement culture that supports local enterprises while advancing operational efficiency. The outcome of this review could lead to significant reforms in how the federal government approaches its purchasing strategies in the future.
