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Feds awarded ArriveCan firm nearly $100 million in contracts, despite issues: AG report
OTTAWA – Another report, this time from Auditor General Karen Hogan, blames the federal government for repeatedly violating procurement policies by awarding dozens of contracts to the IT company that built the ArriveCan application.
The auditor general found that 31 federal organizations issued 106 contracts worth approximately $92.7 million to GCStrategies from April 2015 to March 2024. About $64.5 million was ultimately paid out by the government according to the report.
Over that period, the Canadian Border Services Agency gave four contracts worth $49.9 million to GC Strategies, while the Canadian Broadcasting Corporation gave one contract worth nearly $12,000.
But Hogan also found that in 54 per cent of contracts examined, federal organizations had evidence to show that all services and deliverables were received and in 46 per cent of contracts examined, they had little to no evidence that deliverables were received.
“Despite this, federal government officials consistently authorized payments,” reads the report.
The AG underlined that federal government officials are required to certify that all services and deliverables in the contract were received prior to release of payment to a contractor. Evidently, it was not always the case.
“There are no recommendations in this report because I don’t believe the government needs more procurement rules,” said Hogan on Tuesday.
“Rather, federal organizations need to make sure that the rules that exist are understood and followed,” she added.
Moreover, about a fifth of the contracts the auditor examined showed a lack of documentation on file that showed valid security clearances for contract resources.
Hogan noted that organizations “frequently disregarded government policies in this area.” For instance, it included not having records showing who performed the work, if they had the required experience and qualifications, and what work was completed.
Federal organizations are required to monitor the work performed by contractors.
GCStrategies is an Ottawa-based staffing company in the information technology that provided the feds with “services that included technology support.”
However, the contractor that received about a third of ArriveCan funding was found to be a two-person shop.
Their work with the feds led to “multiple” RCMP investigations last year , and an exceptional reprimand from the speaker of the House of Commons when the company’s co-founder Kristian Firth became the second private citizen and first in 111 years to be called on the floor of the House. He had to go through this extraordinary procedure because he had previously failed to answer questions on his role in the ArriveCan debacle.
ArriveCan was the mobile app the federal government required returning travellers to use at points during the COVID-19 pandemic to monitor COVID testing, quarantine plans and vaccine status.
Hogan had previously found costs for the app had ballooned to roughly $60 million and that the app’s development showed “a glaring disregard for basic management and contracting practices.”
Last year, Public Services and Procurement Canada (PSPC) suspended the security clearance of GCStrategies. This suspension prohibited the company from participating in all federal procurements with security requirements, and existing contracts were cancelled.
Then last Friday, PSPC announced that “the company is ineligible from entering into contracts or real property agreements with the Government of Canada for seven years.”
According to the AG, no new contracts were awarded to GCStrategies in the last fiscal year.
More to come…
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