It seemed pretty bad. A column three months ago criticized Ottawa for its handling of the ArriveCan app, which included paying hefty commissions to a two-person company, GCstrategies, simply for contracting the IT people who actually did the work.
It noted that the federal government has a whole department for contracting and its own IT units, yet issued $44-million in contracts over two years to GCstrategies to bring in the people to do IT work on ArriveCan and other projects.
But it now turns out that was wrong: The government did not pay GCstrategies to bring in the IT workers. They paid them to pay other companies to bring in the IT workers.
Yes, that’s right. Documents that GCstrategies has now provided to the House of Commons committee on government operations and estimates indicated that GCstrategies paid other companies, including well-known firms such as KPMG and BDO Canada, to provide the IT “resources” at rates ranging from $900 to $1,500 a day.
The CBSA said it didn’t know that those other companies were involved – which explains, sort of, why some civil servant didn’t just call those companies directly.
In a statement to The Globe and Mail, the CBSA acknowledged that that “raises some questions about the business model.”
Indeed it does. Those questions include, “Do you have a business model?” and, “What is it modelled upon?”
But at least the Canada Border Services Agency, which organized the ArriveCan project, and Liberal MPs seem to be recognizing that there is a problem, and that a few questions have to be asked. They thought that GCstrategies’s subcontractors were the individual coders and techies doing the work, but it turns out there was another layer of corporations in between.
So here is the correction for that column three months ago: The ArriveCan contracting wasn’t as bad as it seemed. It was worse.
It’s not just that all the IT specialists and contracting and procurement officials in the government couldn’t hire contractors themselves, and therefore had to issue $44-million in deals over two years to an Ottawa firm with two employees to round up computer professionals.
The government’s IT people and contracting officials apparently weren’t able to find the high-profile multinationals and local Ottawa firms whose business models include contracting out IT work, so they inadvertently paid a firm to hire those firms for them.
Now, in defence of the civil servants, it is important to note that ArriveCan was a pandemic project, started in the heat of the first wave in 2020.
At the time, the government and large swaths of the civil service were scrambling to do things such as set up a program to pay temporary benefits to people forced off work, and contracting officials at Public Services and Procurement Canada were desperately trying to procure respirators and masks. If the officials responsible for the ArriveCan IT contracts told us that in all that chaos they felt they had to throw money at it, that would merit some understanding.
But these issues didn’t start and end with rush pandemic projects in the spring of 2020. GCstrategies’s Kristian Firth has said the firm billed the government $44-million over two years for work for more than 20 government departments.
The problems with ArriveCan are not just that a project that started out with an $80,000 app contract ballooned into a project that cost $54-million (when you count the support, maintenance and ancillary costs). It is also that when the government eventually looked back at how it rolled out, it had a hard time figuring what happened.
Ottawa has struggled with lots of IT projects, under both Conservative and Liberal governments, and perhaps part of the problem really is with the government’s business model.
The current federal public service is built to make policy, establish programs and administer agreements. But building the expertise to build an IT system, or even to hire people to build one, doesn’t appear to be part of the model. The public service has to hire people to hire people to hire people.
Those are the sorts of problems, flaws inside the machinery of government, that opposition politicians complain about but governing ones usually ignore. Someone really should be working on the model for doing everyday business.