MPs threaten to issue subpoenas following scathing ArriveCan audit

GC Strategies, a two-man consultancy firm, has declined to attend committee questioning on the ArriveCan scandal. MPs have expressed a willingness to compel committee testimony by issuing subpoenas, which are enforceable by arrest. The pandemic app cost taxpayers an estimated $59.5 million.

MPs threaten to issue subpoenas following scathing ArriveCan audit
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Auditor General Karen Hogan blasted several government agencies Monday for not following “good management practices in the contracting, development, and implementation of the ArriveCAN application.” 

She criticized the Canada Border Services Agency (CBSA), Public Health Agency of Canada (PHAC), and Public Services and Procurement Canada in her scathing report.

“As a result of the many gaps and weaknesses we found in the project’s design, oversight, and accountability, it did not deliver the best value for taxpayer dollars spent,” it said.

Parliament launched ArriveCan in April 2020 for travellers to upload health information, such as vaccination status, at border crossings. It served as a mandatory prerequisite for travel until October 2022. 

Hogan estimated the pandemic tool cost taxpayers $59.5 million — up from earlier projections of $54 million and $21.2 million initially. GC Strategies received the lion's share of the initial funding at $11.2 million to work on the app, while Coradix and Dalian Enterprises received a combined $4.3 million.

From April 2020 to July 2021, PHAC and the CBSA lacked a formal agreement to clarify roles and responsibilities on the ArriveCan application, reported Global News.

The Auditor General and Procurement Ombudsman have documented numerous ArriveCan irregularities including a suspicious absence of records explaining how favoured contractors were selected and why. “Next time we will have to do better,” Public Works Minister Jean-Yves Duclos said Monday.

CBSA and PHAC concurred with all the report’s recommendations. It suggested fully documenting interactions with potential contractors, noting reasons for non‑competitive procurement processes, and complying with federal contracting policies.

A confidential CBSA report related to the audit resulted in suspensions of two former executives after they raised allegations of “fraud and bribery” and suggested that thousands of documents had been destroyed, reported Blacklock’s Reporter.

“I have the information right before me,” CPC MP Larry Brock told the government operations committee February 5. “It is very clear.”

Still, the departments maintain ArriveCAN “was an effective and necessary tool to collect mandatory health information while facilitating travel and trade.”

CBSA continues to pursue an internal investigation and has already referred issues on employee conduct and contractors to the RCMP.

Ritika Dutt and Amir Morv, founders of software company Botler, informed the RCMP in September 2021 of alleged ‘cozy relationships’ between the public service and private firms concerning the project. GC Strategies, a two-man Ontario-based consulting firm, received $19.1 million in total for the ArriveCan app contract, audits show. 

Botler released a more detailed report the following November, suggesting senior government bureaucrats held improper contracting practices with representatives at GC Strategies, Dalian and Coradix. The federal policing agency launched an application investigation soon after.

Although GC Strategies have declined to attend committee questioning, MPs have expressed a willingness to compel committee testimony by issuing subpoenas, reported Blacklock’s Reporter. Committee subpoenas are enforceable by arrest and carry with them the weight of the courts. 

The committee “will call every witness and compel every document,” warned Conservative MP Kelly McCauley. “We will be ordering past and present ministers of public safety, public works and Treasury Board to answer for ArriveCan mismanagement and waste,” he told the Commons. 

The Auditor General’s Office said 18% of invoices submitted by contractors that it tested provided insufficient information “to accurately attribute costs to projects.” Hogan called it the “worst” accounting she’s seen in years.

She also uncovered the feds handing out non-competitive contracts to private firms, including GC Strategies, who never put forward a proposal despite receiving the first contract for the application.

“This gave [them] an advantage that other potential bidders did not have," added Hogan.

At committee October 20, 2022, GC Strategies confirmed they subcontracted the IT work to several companies, charging between a 15% and 30% commission rate. The firm billed Ottawa for the project between $1,000 to $1,500 per worker daily.

The average per diem cost for external resources nearly doubled ($675) that of equivalent IT positions in the public service, reported Global News.

Opposition leader Pierre Poilievre suggested cutting back spending on external consultants in place of the public service, who he claimed does the work "with more accountability" and "do it more affordable."

"We know that because public servants don’t cost $1090.00 a day — they cost significantly less than that," he said.

Public Safety Minister Dominic LeBlanc told reporters Monday he found the ArriveCan irregularities “regrettable” and “unacceptable.”

“We recognize with hindsight things should have clearly been done differently,” said LeBlanc.

“What responsibility does the Trudeau government take?” asked a reporter. “The Trudeau government accepts that taxpayers’ money needs to be treated with the utmost respect,” he replied. 

“Under no circumstance would we pretend that because the whole world was facing this global pandemic, that the contracting rules that need to be robust to handle taxpayers' money, can somehow be disregarded. We’re not saying that at all,” he said.

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