The Government of Canada is committed to conducting procurements in an open, fair, and transparent manner. This starts by ensuring sound management and integrity of its procurement processes.
As the central purchasing agent for the Government of Canada, Public Services and Procurement Canada (PSPC) is committed to continually improving and strengthening all aspects of the federal procurement process.
Since 2017, PSPC has been modernizing government procurement practices, including deploying modern comptrollership, encouraging greater competition, making use of electronic procurement tools and leveraging data so that procurements are simpler, less administratively burdensome and demonstrate the integrity of the suppliers the government does business with.
As part of this modernization, PSPC began to implement advanced data analytics to review and monitor contracts across the Government of Canada. These efforts, along with recent reports by the Auditor General of Canada and the Procurement Ombud, as well as parliamentary committee studies, have revealed a need for action on many fronts to improve the management and integrity of Canada's procurement processes.
Of particular concern are allegations of fraud, bid aiding and falsification of documents. PSPC's detection measures have uncovered instances where individuals, acting as sub-contractors to suppliers, have fraudulently billed the government while working on federal contracts.
In light of these findings, PSPC is taking taking action to strengthen oversight of federal procurement processes, through:
- advancing the modernization of procurement;
- actively detecting and responding to instances of fraud and fraudulent billing;
- implementing immediate improvements to contracting processes and procedures, beginning with professional services contracting; and
- introducing a new Office of Supplier Integrity and Compliance (OSIC).
Procurement modernization
Public Services and Procurement Canada is modernizing government procurement practices so that they are simpler, less administratively burdensome, deploy modern comptrollership, encourage greater competition and include practices that support our economic policy goals, including innovation, green and social procurement.
This includes:
- increasing the diversity of bidders
- better vendor management
- clear metrics
- making government data available
- prompt payment
For more on this, please see: Procurement modernization and improving e-procurement.
Fraud prevention and detection
Public Services and Procurement Canada (PSPC) has a framework of laws, regulations, policies, programs and services in place to prevent, detect and respond to wrongdoing and safeguard the integrity of the federal procurement system. This allows us to detect wrongdoing and actively respond to allegations that the Government of Canada is being defrauded in either a specific contract or on a broader scale.
On March 20, 2024, PSPC announced that it had detected several fraudulent billing schemes undertaken by subcontractors (i.e. individuals) working on federal professional services contracts. This is the result of ongoing departmental efforts to strengthen its approach to detecting fraudulent activities and other types of wrongdoing.
PSPC has taken swift action to revoke or suspend the security statuses of the individuals (i.e. subcontractors) in question. Following administrative investigations, the department has referred the cases to the Royal Canadian Mounted Police.
The department is also moving forward to recover these illegitimate payments on behalf of the Government of Canada.
As today's announcement demonstrates, PSPC has effective methods to detect and respond to instances of fraudulent activity. We will continue to refine and expand the use of our tools, including data analytics, to better detect and address wrongdoing, and to ensure that individuals or entities engaging in fraud or other illegal activities are held accountable for their misconduct, while seeking restitution to the Crown.
In addition, PSPC is regularly exploring lessons learned from identified schemes and cases of wrongdoing to further refine our prevention (including training) and detection measures in order to better respond to future potential instances of misconduct.
