Opening Statement to the Standing Committee on Public Accounts
Relocating Members of the Canadian Forces, RCMP, and Federal Public Service
29 January 2007
Sheila Fraser, FCA
Auditor General of Canada
Mr. Chairman, thank you for this opportunity to discuss Chapter 5 of my November 2006 Report—Relocating Members of the Canadian Forces, RCMP, and Federal Public Service. I am accompanied by Ronnie Campbell, Assistant Auditor General and Bruce Sloan, Senior Principal, who were responsible for this audit.
Our audit raised two primary issues. The first is that fairness in contracting requires that the business volumes set out in the request for proposal be accurate and that all bidders have equal access to the correct information. The government agrees with this view. As committee members will recall, departments have acknowledged that they now know the business volumes set out in the request for proposal were not correct.
The second issue is the clarity of the terms and conditions of the contract. Our position is quite clear: The contract states that third-party services will be paid according to the ceiling rate established in the contract. In the case of property management services, the ceiling rate in the contract is zero percent. The government has agreed with this.
The basis of payment set out in the contract does not distinguish between third-party services that are part of core funding and or the third-party service funded from an employee's personal envelope. The contract is clear—"ceiling prices will apply for all services". As committee members will recall from the last hearing, the government has agreed with this interpretation.
At this time, departments should take steps to ensure that contract terms are respected.
Mr. Chairman, that concludes my opening statement and we would be pleased to answer your Committee's questions.