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Top Suppliers: Numbers to nowhere

by Dan Turner

Here is a thought-provoking question and, one would think, an important one: Why can't the Government of Canada easily tell Canadians how much it is paying out to whom?

Oh, the government tries. Take Canada's Public Accounts that, by definition, belong to the Canadian people. Their job, at the completion of each fiscal year, is to reveal to taxpayers how much money the Receiver General of Canada paid out to myriads of internal and external contractors on behalf of the government's various departments.

There is only one problem. The numbers don't seem to add up. The Public Accounts may be useful as vague indicators of which companies are doing the most business with the federal government - or they may not. Nobody is quite sure. The only thing we can be certain of is that there are enough discrepancies to sorely perplex us and others who have tried their best to sort this whole thing out for you, Summit's readers.

Take the Public Accounts for the fiscal year ending March 31, 2000. When one adds up the cheques that the Reciever General has written on behalf of all federal departments, it would appear that EDS Systemhouse was the No. 1 beneficiary of federal public funds, at $130,335,061, followed by Bombardier Inc., at $90,287,368. Could be. But, based on computations from earlier versions of the accounts, nothing is certain.

We took the time to do an ATIP (Access to Information and Privacy) request on dispensations that the Receiver General made on behalf of the Department of National Defence (DND) over the fiscal year 1997-98 and 1998-99. In 1997-98, the best seller to DND, according to the department's own records, was Computing Devices Canada Ltd., at $218,373,092.90, followed by Bombardier Inc., at $171,222,367.88.

If you have handy a copy of Summit for November 1998, you might want to take a peek at it. In that issue, we did our first "Canada's Best Sellers" feature, laying out the companies that did the most business with the Government of Canada the previous year. Computing Devices Canada Ltd. had a boffo record that year, according to the Public Accounts, where it ranked No. 6 in sales to the federal government, at $72,403,949. But wait. By our calculations, and the calculations of PricewaterhouseCoopers, that amount is $145,969,143.90 less than Computing Devices Canada took in from DND alone in 1997-98 as reported in the ATIP.

As for Bombardier, whose $171,222,367.88 in sales to DND would, on their own, have placed the company fifth on our November 1998 list, its Canadadair Defence Systems Division finished 75th on the list at $1,645,821. There were no other listings under Bombardier over $100,000, which is the cutoff point to make the Public Accounts list. Does this mean that Bombardier racked up at least $171,222,367.88 minus $1,645,821 in sales that year in contracts in which departments paid out less than $100,000 to a contractor - which don't show up in the totals? Or is the company operating under another name most of the time? Or what?

You may well ask what the problem is. Corruption? There is no evidence of that. Attempts to mislead? This seems improbable. The best guess is sloppiness but, if that be the case, this is one heck of a lot of oversight. "The nagging fear in saying that the government numbers don't add up, is that maybe we're not being fair in some way," says Steve Tudor of PricewaterhouseCoopers' Ottawa office, the firm that helped us put together the list. "But if somebody can't explain why the numbers don't add up, then maybe there is something wrong with the way they are being put forward." (By the way, PricewaterhouseCoopers ranks No. 21 on the list of best sellers at $12,160,991, a number they say is considerably different from actual payments.)

John Williams, chairman of the House of Commons Public Accounts Committee (the only Commons Committee chaired by a member of the Official Opposition), says it "doesn't make any sense" that the numbers don't jibe. "We certainly need a lot more openness in government - government has to be more accountable. It almost seems like there is an intentional desire to make the system complex and vague."

Williams does not believe that the federal government's planned shift to an accrual system of accounting from a "modified cash system" (recording cash plus payables) will make much difference. "Accrual is better, but in terms of simple number-crunching I can't see that it's going to be that much more transparent."

Hopefully the fact that more attention might be paid to "balancing the books" each year will lead to more attention to detail.

So what can one say about the Public Accounts numbers for leading contractors that have been put forward for 1999-2000? Assuming that, even if they are incomplete, they depict at least vague trends, there are some observations that can be made:

  • Two years ago, the biggest sellers were mostly defence suppliers, followed by computer hardware suppliers. Health care/heath insurance companies were 21st on the list. This year the list of major suppliers is sprinkled with names from the health industry, including Liberty Health, First Canadian Health, Parkwood Hospital, Sunnybrook Health Science Centre, Pan American Health (Washington, D.C.), and several others - 13 of the top 50.
    .

  • Outsourcing government activities continues. For instance Ottawa's Frontec Logistics Corp., which administers facilities such as armed forces bases, is No. 6 on the list, at $35,892,546. However, some quasi-government firms maintain a hammerlock on their traditional duties within the federal family. The Canadian Corps of Commissionaires, for instance, which provides security services to the government, is No. 3 on the list at $86,087,786. Defence Construction Ltd., Ottawa, still wholly-owned by DND, is No. 26.
    .

  • Although there are all kinds of information and communications technology hardware, software and services firms on the list, including five in the top 10 - EDS Systemhouse, IBM Canada, Media Vision Inc., CGI Group Inc. and Automated IPC Billing - some firms didn't skyrocket the way they might have been expected to during the infamous year of Y2K. EDS Systemhouse, for instance, was first on the list at $130,335,061, but that was up less than $4 million over 1998-99.

These are all trends, or at least we think they are trends. But with a big chunk of the numbers apparently tucked away somewhere else, who knows?


Dan Turner, who covered Parliament Hill for two decades, is an Ottawa writer and consultant.


 

The Top 50 Suppliers to the Federal Government (including DND)

RANK

COMPANY 

SALES

1

EDS Systemhouse

130,335,061

2

Bombardier Inc 

90,287,368

3

Liberty Health 

73,144,768

4

IBM Canada

50,199,912

5

Frontec Logistics Corp Ottawa Ont 

35,892,546

6

First Canadian Health Toronto Ont 

34,867,178

7

Media Vision Inc Montreal Que

32,069,736

8

CGI Group Inc

30,139,092

9

Automated IPC Billing

27,562,959

10

Parkwood Hospital London Ont

19,842,441

11

Sunnybrook Health Science Centre Toronto Ont

18,557,148

12

LGS

17,521,863

13

AJJA

16,136,665

14

Pan American Health Washington DC USA 

15,606,411

15

Lockheed Martin Canada Inc 

15,475,914

16

Veritaaq Technology House Inc Ottawa Ont 

14,925,447

17

Queen Elizabeth II Health Sciences Centre Halifax NS 

13,648,645

18

Brookfield Lepage Johnson Controls Toronto Ont 

13,114,613

19

PricewaterhouseCoopers 

12,160,991

20

Calian Technology Services Ltd Kanata Ont

11,567,936

21

AMS Canada 

10,770,466

22

ADGA

10,692,026

23

ISM Information Systems Management Ottawa Ont 

10,604,994

24

SAP Canada Inc Toronto Ont 

10,514,079

25

SAIC Canada Ottawa Ont 

10,478,120

26

Oerlikon Aerospace Inc Richelieu Que 

10,126,342

27

Perley Rideau Veterans Health Centre Ottawa Ont 

10,089,184

28

Peacock Inc Montreal Que 

9,540,000

29

Medical Services Plan Victoria BC 

9,463,032

30

Computer Sciences Canada Inc Kanata Ont 

9,297,097

31

Blue Cross of Atlantic Canada

9,021,608

32

DRT Systems International Toronto Ont 

8,812,929

33

AQR Management Services Inc

8,412,960

34

Groupe Everest Montreal Que 

8,384,678

35

Alberta Health Care Insurance Plan Calgary Alta 

8,005,186

36

Ajilon Canada

7,667,928

37

Maxxam Analytics Inc

7,638,807

38

Saint John Regional Hospital Saint John NB 

7,548,151

39

Gosselin Communications Ottawa Ont 

7,454,397

40

Deer Lodge Centre Winnipeg Man 

7,326,354

41

Great West Life Insurance Co Ottawa Ont 

7,152,806

42

Nortak Software Ltd Ottawa Ont 

6,839,637

43

DMR Consulting Group Inc 

6,439,675

44

DEW Engineering and Development Ottawa Ont

6,435,523

45

IMP Group Ltd Halifax NS

6,401,318

46

Powell Group Ottawa Ont

6,296,026

47

Excel Human Resources Ottawa Ont 

6,023,942

48

Cashier's Section Treasury Branch Toronto Ont

6,016,193

49

Bradson Mercantile Incorporated Ottawa Ont 

5,967,538

50

Rider Travel Group Inc The Ottawa Ont 

5,815,873

 

TOTAL

918,293,563

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html, table compiled by PricewaterhouseCoopers

The Top Suppliers (minus DND)

RANK

COMPANY

SALES

1

EDS Systemhouse

129,372,878

2

National Revenue 

107,461,083

3

Liberty Health 

73,144,768

4

Canadian Corps of Commissionaires

56,370,642

5

IBM Canada

46,325,529

6

First Canadian Health Toronto Ont 

34,867,178

7

Media Vision Inc Montreal Que

32,069,736

8

Automated IPC Billing

27,562,959

9

CGI Group Inc

25,704,410

10

Parkwood Hospital London Ont

19,842,441

11

Sunnybrook Health Science Centre Toronto Ont

18,557,148

12

Corcan Ottawa Ont 

16,310,077

13

Pan American Health Washington DC USA 

15,606,411

14

AJJA

15,229,814

15

Veritaaq Technology House Inc Ottawa Ont 

14,712,056

16

Queen Elizabeth II Health Sciences Centre Halifax NS 

13,648,645

17

Brookfield Lepage Johnson Controls Toronto Ont 

13,114,613

18

PricewaterhouseCoopers 

11,995,237

19

Lockheed Martin Canada Inc 

11,762,450

20

SAP Canada Inc Toronto Ont 

10,514,079

21

Perley Rideau Veterans Health Centre Ottawa Ont 

10,089,184

22

Medical Services Plan Victoria BC 

9,463,032

23

Blue Cross of Atlantic Canada

9,021,608

 

TOTAL

722,745,978

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html, table compiled by PricewaterhouseCoopers

The Top 20 Informatics Suppliers

RANK

COMPANY

SALES

1

EDS Systemhouse Inc

49,476,434

2

CGI

16,608,386

3

IBM Canada Ltd 

15,860,442

4

LGS Group Inc Ottawa Ont 

12,143,066

5

Veritaaq Technology House Inc Ottawa Ont

10,920,834

6

SAIC Canada Ottawa Ont

10,478,120

7

AJJA Information Technology

9,330,726

8

AMS Canada 

8,949,038

9

AQR Management Services Inc

7,158,977

10

Nortak Software Ltd Ottawa Ont

6,709,632

11

Ajilon Canada 

6,558,464

12

DRT Systems International

6,472,638

13

Computer Sciences Canada Inc

5,807,417

14

PricewaterhouseCoopers

5,165,636

15

Kischi Konsulting Inc Hull Que 

4,342,032

16

Siemens Nixdorf Inc Chicago USA

4,152,545

17

New Systems Solutions Ltd

3,982,635

18

ADGA

3,944,564

19

Systems Interface Inc 

3,634,589

20

Calian Technology Services Ltd

3,542,481

 

TOTAL

195,238,656

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html, table compiled by PricewaterhouseCoopers

Top Health Suppliers

RANK

COMPANY

SALES

1

Liberty Health 

73,144,768

2

First Canadian Health Toronto Ont 

34,867,178

3

Parkwood Hospital London Ont

19,842,441

4

Sunnybrook Health Science Centre Toronto Ont

18,557,148

5

Pan American Health Washington DC USA 

15,606,411

6

Queen Elizabeth II Health Sciences Centre Halifax NS 

13,648,645

7

Perley Rideau Veterans Health Centre Ottawa Ont 

10,089,184

8

Medical Services Plan Victoria BC 

9,463,032

9

Blue Cross of Atlantic Canada

9,021,608

10

Alberta Health Care Insurance Plan Calgary Alta 

8,005,186

11

Saint John Regional Hospital Saint John NB 

7,548,151

12

Deer Lodge Centre Winnipeg Man 

7,326,354

13

Great West Life Insurance Co Ottawa Ont 

7,152,806

 

TOTAL 

234,272,912

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html
table compiled by PricewaterhouseCoopers

Procurement by Federal Government Department

DEPARTMENT

PROFESSIONAL & SPECIAL SERVICES

CONSTRUCTION & ACQUISITION

TOTAL

Public Works and Government Services Canada

1,063,432,329

619,242,906

1,682,675,235

Department of National Defence

1,043,669,175

215,580,681

1,259,249,856

Industry Canada

303,363,435

8,542,301

311,905,736

Human Resources Development Canada

372,248,673

1,293,173

373,541,846

Solicitor General

335,505,146

134,167,294

469,672,440

Health Canada

292,132,877

3,924,987

296,057,864

Department of Fisheries and Oceans

184,176,898

34,253,924

218,430,822

Veterans Affairs

217,489,816

1,613,902

219,103,718

Canadian Heritage

137,508,628

18,584,159

156,092,787

Department of Foreign Affairs and International Trade

164,136,863

71,966,859

236,103,722

Agriculture and Agri-Food Canada

108,941,786

38,900,568

147,842,354

Natural Resources Canada

194,350,667

9,207,746

203,558,413

Environment Canada

105,649,285

446,946

106,096,231

Revenue Canada

160,681,660

9,424,842

170,106,502

Citizenship & Immigration

94,146,906

N/A

94,146,906

Indian & Northern Affairs Canada

94,061,833

2,402,839

96,464,672

Totals

4,871,495,977

1,169,553,127

6,041,049,104

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html, table compiled by PricewaterhouseCoopers

Number of Contracts by $ value

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html

 

No. 1 Supplier by Category

 

INFORMATICS

DEFENCE

OVERALL

LARGEST 
SINGLE PAYMENT

EDS SYSTEMHOUSE
 $24,415,905

BOMBARDIER INC
 $89,674,735

BOMBARDIER INC
 $89,674,735

LARGEST 
NUMBER OF CONTRACTS

EDS SYSTEMHOUSE
(27)

GE CANADA INC
(3)

EDS SYSTEMHOUSE
(48)

LARGEST 
CONSTRUCTION PAYMENT

N/A

HERVE GENERAL CONTRACTORS INC
 $23,897,268

ELLIS-DON CONSTRUCTION
 $91,607,911

Source: Public Accounts 2000, www.pwgsc.gc.ca/text/pubacc-e.html, table compiled by PricewaterhouseCoopers

 

 

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