Ottawa’s $92M Federal Contract Disaster

🚨 Auditor General Slams Federal Contracts

A new report from Auditor General Karen Hogan has delivered a scathing rebuke to the federal government’s procurement practices. Between April 2015 and March 2024, 31 federal organizations awarded 106 contracts worth nearly $93 million to GCStrategies – an Ottawa-based staffing firm that played a key role in developing the much-criticized ArriveCan app.

According to the report, the federal government ultimately paid out about $64.5 million to GCStrategies during that time. However, nearly half of these contracts lacked clear evidence that work was done.

👉 The Numbers:

• 31 organizations issued contracts.

• 106 contracts totaled about $92.7 million.

• $64.5 million actually paid out.

• In 46% of cases, there was little to no proof of deliverables.

• In 54%, there was evidence that work was received.

Yet, despite these red flags, government officials consistently authorized payments, the report says.

Hogan was clear that the issue isn’t the rules themselves – it’s whether anyone is following them.

😬 Security and Oversight Failures
The report also found serious lapses in security and oversight. In about a fifth of the contracts, there was no documentation showing valid security clearances for workers – a major no-no for federal projects.

“Organizations frequently disregarded government policies in this area,” Hogan noted. That included failing to keep records of who did the work, whether they were qualified, and whether deliverables were actually provided.

Conservative MP Michael Barrett summed up the frustration:

Hogan stressed that federal organizations are required to monitor contractors and ensure they’re delivering. But she also clarified that her office can’t investigate private companies like GCStrategies itself.

📢 “I believe the government needs to take a step back and look at why this behavior is happening,” she added at a press conference.

🔎 GCStrategies: A Two-Person Operation
GCStrategies is a tiny two-person company that somehow secured a third of the funding for ArriveCan, a pandemic-era app meant to track testing, quarantine, and vaccine status for travelers. The Auditor General previously slammed the app’s development, saying it showed a “glaring disregard for basic management and contracting practices.”

The company’s dealings with the feds sparked multiple RCMP investigations last year and even forced its co-founder, Kristian Firth, to appear on the House of Commons floor – an extremely rare move that hadn’t happened in 111 years.

🔒 No More Contracts for GCStrategies
Last year, Public Services and Procurement Canada (PSPC) suspended GCStrategies’ security clearance, stopping them from participating in federal contracts. And just last week, PSPC took the drastic step of banning the company from entering any federal contracts or real property agreements for the next seven years.

According to the Auditor General, no new contracts were awarded to GCStrategies in the last fiscal year.

📝 Minister’s Response
Public Services and Procurement Minister Joël Lightbound said the report’s findings align with earlier internal and external audits.

💡 A Broader Issue?
What’s clear is that this isn’t just about GCStrategies or ArriveCan – it’s about a broader culture of complacency in federal procurement. Despite rules in place to ensure accountability and security, they were routinely ignored.

The report underscores a fundamental truth: having rules isn’t enough if no one’s following them.

✅ Key Takeaways:

• 31 federal organizations awarded 106 contracts to GCStrategies, totaling almost $93 million.

• Nearly half of those contracts had no real evidence of work done.

• Security clearances were missing or undocumented in a fifth of contracts.

• The government has finally banned GCStrategies from federal procurement for seven years.

The Auditor General’s findings shine a harsh light on federal oversight – and raise questions about whether taxpayers are really getting what they’re paying for.