December 2, 2023

Anand’s former division, Public Companies and Procurement Canada, makes all different public servants appear like hopeless amateurs with regards to losing cash

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The sport is up. The Liberal authorities’s tactical plan of utilizing borrowed cash to burnish its personal fame has been thwarted by new fiscal realities.

Rising rates of interest will see debt-servicing costs rise to over $44 billion this yr — greater than the federal government spends on employment insurance coverage, youngster care or defence.

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The brand new Treasury Board president, Anita Anand, has been informed to search out $15 billion in financial savings this fall as a part of a brand new emphasis on “fiscal administration and prudence” — phrases which have barely handed the lips of Liberals previously eight years.

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A very good place for Anand to look could be her former division, Public Companies and Procurement Canada (PSPC), which makes all different public servants appear like hopeless amateurs with regards to losing taxpayers’ cash.

Readers with hypertension could be suggested to achieve for his or her receptor blockers earlier than we run by way of a few of PSPC’s biggest hits — and I’m solely going again by way of the current again catalogue to keep away from aggravating hypertension.

That is the division that in 2020 awarded a state-owned Chinese language firm a multi-million-dollar contract to put in X-ray scanners at Canadian embassies all over the world — a dedication later rescinded when it was identified that we’d not need the Chinese language to know the exact skeletal construction of everybody who enters a Canadian embassy.

Earlier this yr, PSPC requested for, and acquired, an additional $500 million to “stabilize” a Phoenix pay system that also has a rising backlog of instances, primarily as a result of the federal government can’t resist hiring extra public servants.

One other belter from this spring was the case of the 76 armoured Toyota Land Cruisers ordered for embassies all over the world. The federal government solely ever obtained 33 from the provider, who gratefully pocketed 90 per cent of the $20 million contract paid up-front as a part of a deal negotiated by… PSPC.

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However that was piker stuff in comparison with the heedlessness revealed by colleague Chris Nardi’s current report on the “useless” Coast Guard ship. The story stated the federal government paid $520,000 to a Nova Scotia-based firm to retailer the ship, despite the fact that Ottawa was suing the identical firm for negligence over the identical boat.

CCGS Corporal McLaren had solely been in service for 5 years when it underwent repairs on the Sambro yard in Nova Scotia, owned by Canadian Maritime Engineering. Throughout its time within the dock, it was vandalized and partially capsized, inflicting $14 million in damages. The federal government is suing CME for failing to safe the vessel. Nonetheless, whereas it considers whether or not to scrap or restore Corporal McLean, it must retailer it someplace. After a public tender, PSPC awarded the $520,000 contract to a different shipyard owned by CME. Within the eyes of the decision-makers at PSPC, the 2 yards are separate enterprise entities. To regular folks, they’re litter mates and the contract ought to by no means have been awarded.

It could be argued that the issue lies with the Canadian Coast Guard for not making its thoughts up on whether or not to restore the boat. Nevertheless it’s truthful to say PSPC made the worst of a foul job.

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That is all picayune stuff in comparison with the granddaddy of all PSPC spending missteps: the Canadian Floor Combatant venture.

In 2011, Irving Shipbuilding in Halifax was chosen because the winner of a young to construct a brand new fleet of warships. Among the many necessities was the stipulation that the successful yard needed to have the aptitude to construct the ships with out additional taxpayer contributions.

Since then, delays have piled upon value overruns, to the purpose the place the supply of the primary ship has been deferred by a decade and the unique buy worth of $26 billion has risen to round $84.5 billion, in keeping with estimates by the Parliamentary Finances Workplace.

Insult was added to damage final month when the federal government stated it’s going to make investments an extra $463 million into the Irving yard to “enhance its effectivity,” even when Ottawa refused to say precisely how this cash may speed up supply.

The division operating the present is, you guessed it, PSPC.

Those that have watched this long-running saga of contempt for the taxpayer unfold say {that a} push by Lockheed Martin to make use of its Sky 7 radar system was not resisted by the Defence Division or PSPC. That’s the actual cause the Irving yard wanted extra funding, because it has made the ship greater and heavier. Totally-loaded, the BAE Techniques Sort 26 frigates shall be twice as heavy because the Halifax ships they’re changing.

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A 2021 article in Defence Information, quoted naval defence analyst, Timothy Choi, saying the brand new frigates will embrace “just about each single weapon that you could possibly consider for a contemporary, high-end combatant ship.”

That is a part of the issue — and the place PSPC, because the taxpayers’ watchdog, must be extra assertive.

Different nations expertise failures and price overruns, however they’re often for dangerous developmental tasks just like the F35 fighter jet.

Canada chooses from current capabilities, which, in principle, ought to scale back these issues and dangers. That has not been the expertise with both the fighter-jet venture or the ships.

The string between all these pearls is PSPC, which has constantly failed in its responsibility to behave as a central buying agent that delivers worth for cash to taxpayers.

The division may argue that in any given yr there are solely between 30 and 50 procurement complaints earlier than the Canadian Worldwide Commerce Tribunal, which means that hundreds of transactions that don’t make the headlines go comparatively easily.

However not even the division’s most vocal defenders might argue that Canada does procurement effectively.

The federal government’s failure to ship on the ships and different procurement tasks will ultimately value it dearly, undermining any claims of competence.

However that’s solely truthful as a result of its improvidence has racked up an enormous invoice that should be handed on to future generations.

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