$54 Million ArriveCan App: 76% of Contractors Did No Work

An investigation by the Federal Procurement Ombudsman into the $54 million ArriveCan app’s development has revealed massive breaches in contracting rules.

The report, led by Procurement Ombudsman Alexander Jeglic, found that outsourcing companies, particularly GCStrategies, a two-person IT staffing firm, won contracts by listing subcontractors who ultimately did no work. Say what?!

The investigation into the app, which cost over $54 million to build and maintain, exposed that GCStrategies often failed to prove its team of subcontractors had the necessary résumés and work experience. The ombudsman discovered “numerous examples” where the company had merely copied and pasted government-required work experiences to describe the skills of its proposed subcontractors.

Furthermore, the report criticized the government for using criteria that favoured GCStrategies, leading to the company securing a $25-million IT services contract without competition. This incident raises questions about the fairness and transparency of government procurement processes.

The ombudsman’s report, responding to a request from the Commons committee on government operations, examined 41 ArriveCan-related procurements. It found that in about 76% of applicable contracts, the resources proposed in winning bids did not perform any work. How is this even possible?

“While there may be legitimate reasons for some proposed resources being unavailable, the number of times it occurred and the absence of file documentation explaining why these resources were not made available raised serious concerns,” the report stated, according to the Globe and Mail.

Jeglic also criticized the government’s public disclosure policies, noting that 41% of ArriveCan-related contracts were not fully disclosed online as required. “Practices for awarding competitive and non-competitive contracts, for issuing TAs and service orders, and for proactive publication of contract information were inconsistent with government policy,” Jeglic concluded.

Kelly Block, Conservative Shadow Minister for Public Services and Procurement, and Pierre Paul-Hus, Conservative Quebec Lieutenant, slammed the Liberals in a joint statement.

“A damning watchdog report has revealed that federal officials in the Trudeau Government rigged the ArriveCan contract so it would end up with the well-connected, two-person consulting firm, GC Strategies. In total, these two individuals did not work on the app, yet received $11 million dollars from taxpayers,” said both Block and Paul-Hus.

The departments connected to the ArriveCan contracts – Canada Border Services Agency (CBSA), Public Services and Procurement Canada, and Shared Services Canada – have responded by accepting Jeglic’s policy recommendations and outlining planned changes. The CBSA has committed to strengthening its procurement planning and contract administration processes to reduce fraud risk.

This investigation follows allegations of contracting misconduct raised by Montreal software company Botler, which worked with CBSA on a project involving some of the same public servants and contractors as ArriveCan, including GCStrategies. Botler’s co-founders Ritika Dutt and Amir Morv expressed encouragement at the ombudsman’s findings, stating, “It is promising that the CBSA has agreed with the report and is introducing action plans.”

“Multiple investigations into ArriveCan have revealed millions in taxpayer dollars sent to connected insiders and consultants. And that government officials have been suspended without pay for their involvement in the app and inappropriate relationships between government officials and contractors, and more, including GC Strategies hosting an “ArriveCan Whisky Tasting” with government officials to celebrate the app,” continued Block and Paul-Hus.

The two-man GCStrategies team has received close to $60 million in contracts from the Liberal government since 2017. They charged Canadians $11 million alone for the ArriveCan app, which has since become pretty useless.