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Ottawa is too secretive with the details of government contracts, a tendency that undermines public trust and makes it harder for innovative companies to compete with larger rivals, business groups say.

The groups are demanding more transparency when it comes to getting the federal government to disclose documents in response to formal information requests.

The Globe and Mail recently launched Secret Canada, an investigation into the country’s broken access-to-information systems. A Globe audit of more than 250 public-sector entities found that governments, as well as many agencies that report to them, are not meeting their legal obligations to release information.

Businesses are frequent users of the federal access to information system, generating 41 per cent of requests in the 2021-22 year. One common use of the system is to request procurement documents so a business can understand what the government is looking for before the start of a bidding process or to understand why a rival won a contract.

But business groups say these documents are often heavily redacted, which makes it hard to know how public money is being spent.

“Access to information is about trust: trust in government, trust in decision-making,” said Matthew Holmes, senior vice-president of policy and government relations at the Canadian Chamber of Commerce.

Mr. Holmes said businesses want to know “that decisions are being made without bias, undue influence or, in the worst cases, malfeasance. If there’s problems with the access to information system, it can really compromise trust in doing business with government.”

Benjamin Bergen, president of the Council of Canadian Innovators, said more disclosure could level the playing field for small firms competing for contracts against larger rivals that are often foreign-owned and have large government-relations teams.

“Transparency and clarity around what contracts win, what don’t, will help scaling tech firms have better insight into what’s happening,” Mr. Bergen said.

Details of contracts are often withheld under Section 20 of the Access to Information Act. That section covers “third-party information” and allows federal departments to redact information that comes from outside the government. When a department receives an access request that might be subject to Section 20, it notifies the third party that supplied the information. That third party can then request that the information be withheld if disclosing it would be financially harmful.

Sometimes, a government institution will disclose the total amount of a contract but withhold the details of how a bidder arrived at that price. For example, earlier this year The Globe filed a request with Export Development Canada to find the accounting for its contract with Accenture Inc. to deliver the Canada Emergency Business Account program. EDC’s release revealed that the contract was worth $146-million up to the end of March. But under Section 20, the Crown corporation withheld how much of that money went toward specific line items such as a call centre and web services.

Matt Malone, a law professor who studies trade secrets and commercial confidentiality at Thompson Rivers University in Kamloops, said public funds should never be considered confidential information.

He said the exemption has also been used to hide the identities of government subcontractors, as in the case of the ArriveCan app, in which a small Ottawa company used multiple subcontractors to fulfill a $54-million government contract.

In response to concerns about that contract and other outsourcing, the government has said it is working to improve how contracting information is posted online.

“We acknowledge that there are concerns about how the government discloses work that has been contracted out,” Mona Fortier, then the president of the treasury board, told MPs on the government operations committee during a Feb. 8 hearing that focused on federal outsourcing contracts with McKinsey & Company.

Ms. Fortier said internal tests are under way to improve the system.

“We are going to continue to make sure that pro-active disclosure is put into practice,” she said.

The government announced on June 27 that it was taking steps to improve procurement, including updating a guide for public servants to encourage them to disclose more information about how winning bids are selected.

The House of Commons committee on access to information, privacy and ethics released a report in June with recommendations to improve the access system, such as amending the Access to Information Act to state that public spending amounts are never confidential information.

Franco Terrazzano, the federal director of the Canadian Taxpayers Federation, said contracts should be written in a way that allows for full disclosure.

“We want the government to really go a step further and ensure that maximum transparency is built into the contracts and negotiating process,” Mr. Terrazzano said. “So businesses know, upfront, that if they are going to take taxpayers’ money, then they’re going to be required to be transparent with the public.”

With a report from Bill Curry

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