(Pursuant to the order adopted by the Senate on December 7, 2021, to receive a Minister of the Crown, the Honourable Jean‑Yves Duclos, P.C., M.P., Minister of Public Services and Procurement, appeared before honourable senators during Question Period.)

(Pursuant to the order adopted by the Senate on December 7, 2021, to receive a Minister of the Crown, the Honourable Jean‑Yves Duclos, P.C., M.P., Minister of Public Services and Procurement, appeared before honourable senators during Question Period.)

(Pursuant to the order adopted by the Senate on December 7, 2021, to receive a Minister of the Crown, the Honourable Jean‑Yves Duclos, P.C., M.P., Minister of Public Services and Procurement, appeared before honourable senators during Question Period.)

(Pursuant to the order adopted by the Senate on December 7, 2021, to receive a Minister of the Crown, the Honourable Jean‑Yves Duclos, P.C., M.P., Minister of Public Services and Procurement, appeared before honourable senators during Question Period.)

The Hon. the Speaker: Honourable senators, today we have with us for Question Period the Honourable Jean-Yves Duclos, P.C., M.P, Minister of Public Services and Procurement. On behalf of all senators, I welcome the minister.

Honourable senators, let me remind you that during Question Period with a minister the initial question is limited to 60 seconds, and the initial answer to 90 seconds, followed by one supplementary question of at most 45 seconds and an answer of 45 seconds. The reading clerk will stand 10 seconds before these times expire. Pursuant to the order adopted by the Senate, senators do not need to stand. Question Period will last 64 minutes.

[English]

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: Madam Chair, I would like to begin by congratulating you on your new role as Speaker of the Senate, as a Franco-Manitoban. We are proud that you are the Speaker of the Senate, and we look forward to collaborating with you over the coming months to ensure the Senate’s full cooperation and ability to work in service of Canadians.

[English]

Regarding the question that you asked, let me expand the scope a bit. Let us remember the importance of having fought so hard for the health and safety of Canadians during a time in which we were facing the largest public health emergency of over a century, as well as the biggest economic crisis since the 1930s. We had to invest significant resources in order to, in part, make sure that Canadians and other people who needed to come into Canada for essential reasons — in many cases, to deliver food, medicine and the types of goods that Canadians depended on — could travel safely and conveniently through the border. We did that mindful of the fact that tens of thousands of lives had been saved because of the efforts of the Canadian government — and, more importantly, because of the efforts and the commitment of Canadians.

Hon. Tony Loffreda: Minister Duclos, thank you for being with us today. I’d like to explore a topic I first raised with you in December 2020, when you appeared before the Standing Senate Committee on National Finance.

It has to do with the government’s real estate portfolio and its commitment to advancing the Office Long Term Plan, or OLTP. You’ve been tasked once again with studying this issue.

I know the Government of Canada wants to offer greater flexibility and agility by providing options for hybrid work environments that meet operational requirements and promote productivity. That’s a big mission to manage when you’re also looking to reduce the government’s real estate footprint. Are you in a position to provide us with an update on this matter?

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: The fact that this question comes from you is very significant, since you, along with many others, worked on getting Davie added to the National Shipbuilding Strategy. Many people know that and are grateful to you.

That being said, over the next few years, a major national maritime hub will be established in the Quebec City area. This hub will have a considerable impact from both a technological and a purely industrial standpoint. It will change the lives of tens of thousands of workers and give contracts to about 1,300 service providers. We know that similar shipbuilders, such as Irving and Seaspan, faced some issues in the early 2010s. Every one of them, including Davie, has had to pay for their technology and production upgrades themselves. That’s what happened in the other provinces, with support from the provincial governments of Nova Scotia and British Columbia. As you pointed out, that’s what happened in Quebec in the spring. The assistance provided to Irving Shipbuilding a few months ago was, as you and we both noted, targeted funding to build combat ships in a way that wasn’t foreseen in the early 2010s. It’s a necessary improvement to reduce costs and delays for the incredibly difficult construction of those 15 combat ships.

Hon. Amina Gerba: Welcome to the Senate, Minister Duclos.

Studies have shown that Black entrepreneurs have to overcome a large number of obstacles and face systemic discrimination when developing a business venture.

One of the main obstacles they face is access to the federal public procurement process. Having been an entrepreneur myself for two decades, I’ve seen how important it is to have access to the public market. In particular, we know that public procurement can make the difference between staying small and going multinational.

Minister, your department has put initiatives in place to diversify its suppliers. Can you tell us what has been done specifically to ensure that Black entrepreneurs have access to government contracts?

To answer quickly, you seem to be familiar with the plan to increase the diversity of supply chains in Canada. This plan was launched about two years ago, and one of its sub-components focuses on support for businesses owned or managed by Black entrepreneurs in this country. The plan also includes a pilot project through which a dozen or so procurement opportunities have already been created.

As you correctly stated, this initiative is designed not only to help these entrepreneurs participate fully in growing the economy, in a dynamic perspective that prepares them for larger contracts down the road, but it also brings greater competition to the procurement process, which you alluded to earlier. The more competition there is, the more diversity we have among suppliers. The better the government’s terms of reference are, the higher the quality of the services offered to Canadians will be.

Hon. Jim Quinn: Thank you for joining us this afternoon, Mr. Duclos.

[English]

When bidders respond to tender requests, they respond to technical and other requirements as outlined in the tender and submit their cost for delivery of a service and a product. Our process is such that the lowest qualified bid wins the contract. However, far too often the qualified bid with the lowest price has been underbid to the point that “extras” or “work arisings” result in a final price that far exceeds the price submitted in the bid. What steps can the government take to reduce the risk associated with underbidding?

If I can go back briefly — because I know time is always too short — to your first question on the integrity of the process, I can assure you that it is my responsibility and the responsibility of my officials to make sure that when a contract is awarded, the requirements that the businesses signing those contracts accept are followed up on and enforced if it is necessary to enforce them.

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: Thank you. I am going to both correct and confirm what you said.

It is incorrect to say that no action has been taken and that no contract has been entered into or discussed with Seaspan, which has been part of the strategy since 2011.

I would be pleased to give you more information about the positive progress being made at this shipyard on the construction of the polar icebreaker.

As for the Davie shipyard, we are obviously talking longer term because it was unfairly and inappropriately excluded from the first National Shipbuilding Strategy in 2011 by the government of the day. Everyone in Quebec and elsewhere in the country is delighted that this mistake was corrected a few months ago. Naturally, we have to work with the shipyard in its current condition, after it was excluded from the first strategy.

We are working very well with the Davie shipyard. Its staff are dynamic and their suppliers’ association is amazing. It travels across the country and around the globe promoting the importance of investing in Quebec City, in Quebec and in Canada, for projects like the construction of the icebreaker they will eventually receive.

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: First, in regard to the timeline, my predecessor — whom you would know — did say that we are looking forward to the fall to provide Canadians, and the Senate indirectly, with an update on what the plan is for official residences, including the official residence of the Prime Minister.

Second, 24 Sussex Drive is currently being worked on. Asbestos is being removed, and the integrity of the building is being protected. Whatever the final decision may be, the building will be there. It won’t be in its current shape because it’s not safe — for the reasons that I just mentioned — but it will be available for the use that Canadians will want to make of it.

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: Thank you for the question, senator.

The answer is yes and no. It is indeed an important criterion, but it’s not the only one. Among all the criteria that public servants and the people managing these contracts have to take into account, there are others as well. The environmental impact of our procurement process is key — increasingly so — because we know that we can’t keep going in the same direction, from an environmental point of view, because we will hit a wall. We saw the preliminary impact over the past few months in Canada and Quebec.

However, there are other important criteria, such as social inclusion, social participation and obviously efficiency, which, as I was saying, is sometimes improved and supported by other criteria. Again, the social inclusion criterion broadens participation in the procurement process. It supports greater competition in these processes, which means better results for the Canadian government and for Canadians.

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: Thank you again for that great question.

In regard to community benefits, they include both the social and environmental benefits of using procurement as an important public policy tool.

In regard to social benefits, we’ve already spoken about the importance of supporting various groups whose relative exclusion in the procurement process harms Canadians who are from those groups, but it is also harmful to the overall competitiveness of procurement processes.

When more providers and suppliers are included — including women, Indigenous Canadians and Black-owned or Black-led businesses — everyone benefits. That is the first piece, and the second piece is green procurement.

This is a good statistic: Between 2005 and 2023, investments in properties and federally‑owned buildings decreased the level of greenhouse gas, or GHG, emissions by 60%. Now, in 2023, we have 60% less GHG emissions than in 2005 because of the non-economic impact of investments in our communities, so these are important aspects as well.

Hon. Jean-Yves Duclos, P.C., M.P., Minister of Public Services and Procurement: Thank you. Your question is, again, fair, and it will require a long answer. Let me, therefore, point to just two things that you briefly mentioned.

The National Shipbuilding Strategy, I just mentioned earlier the great and long-awaited progress we have been able to make, including the Davie shipyards as the new third shipyard in the new National Shipbuilding Strategy. This is a significant step which will lead to faster delivery of ships that the Coast Guard and other organizations require, at a lower cost, at a higher speed and with greater outcomes for Canadian industry.

On the 5% Indigenous procurement target, I spoke to that earlier. A number of departments have already exceeded that target; others need to work harder. We look forward to posting and revealing the global estimate toward the beginning of 2024.

The Hon. the Speaker: Honourable senators, the time for Question Period has expired. I am sure you will join me in thanking Minister Duclos for being here with us today.

Thank you, minister. We will now resume the proceedings where we left off.