Ottawa said its outsourcing agreement with Accenture was a sole-source contract because the government believed a formal procurement process would take too long.DADO RUVIC/Reuters
Ottawa’s $208-million outsourcing agreement with consulting firm Accenture Inc. to deliver the pandemic support program for businesses was a sole-source contract, the government has confirmed.
The Irish-American company’s contract to administer the Canada Emergency Business Account (CEBA) program was revealed by The Globe and Mail in February. After an access-to-information request, weeks of back-and-forth with the government and questions from parliamentarians in the House of Commons and the Senate, Ottawa has finally provided more details of the agreement.
The government told The Globe it was a sole-source contract because Ottawa believed a formal procurement process would take too long.
“When the COVID-19 pandemic hit, the federal government acted swiftly to provide emergency support and ensure that Canadians and Canadian businesses could weather the storm,” said Katherine Cuplinskas, press secretary for Finance Minister Chrystia Freeland, in an e-mail.
CEBA was the first and most widely used pandemic support for businesses. It was launched April 9, 2020, and provided partly forgivable loans of as much as $60,000 to almost 900,000 businesses. Some $49-billion in credit was extended to those enterprises through their financial institutions, and many entrepreneurs have credited the program with providing a crucial lifeline during the uncertainty of the first COVID-19 lockdowns.
Ottawa originally assigned the program to Export Development Canada, a Crown corporation that provides credit to Canadian businesses doing work abroad. EDC was given the task because it is the steward of the Canada Account, a mechanism to lend money to businesses that EDC would otherwise deem too risky to support.
But EDC said it did not have the internal capacity to operate a loan program of that scale, so it outsourced much of the implementation to Accenture.
The Finance Department told The Globe EDC chose Accenture to deliver CEBA because the two had worked together before. EDC said it operates at “arm’s length” from the government and “made the full decision” to award the contract to Accenture.
Accenture declined to comment on the agreement.
Although Accenture is widely known as one of the largest management-consulting companies in the world, both the Finance Department and EDC said the company provided technology and staffing services, “not consultant advice.”
The contract has never been included in the government’s proactive-disclosure database, nor in lists tabled in Parliament of contracts awarded during the pandemic.
After The Globe’s reporting earlier this year, parliamentarians in opposition parties filed requests to the government for more information about the contract.
According to documents filed in the House and the Senate, the agreement with Accenture actually comprises a total of 31 contracts to deliver CEBA, some of which were extensions of earlier agreements. The earliest was for $1-million on April 8, 2020, to set up a program to connect Ottawa with 230 financial institutions, as businesses applied for the CEBA loans through their banks or credit unions.
The most recent contract on the list was for $4,976,050, on Feb. 1, to continue funding the CEBA call centre and prepare it for collecting the loans. Businesses that pay back their CEBA loans by Dec. 31 get part of the loans forgiven. The final deadline to pay them back in full is Dec. 31, 2025.
The total value of all CEBA contracts awarded to Accenture is $208-million, and they run until February, 2024, according to the documents.
That is larger than any other contract given to a major consulting firm in Ottawa’s public database of contracts. The next biggest is a $203-million, multiyear, competitive contract awarded to Deloitte to modernize the Old Age Security payment system. The largest previously awarded to Accenture was a $130-million, six-year, competitive contract it was given in 2016 for management consulting for Public Services and Procurement Canada.
Opposition politicians expressed frustration with how difficult it has been to get information about the contract.
“The government has been clear as mud on this file,” said Conservative Senator Yonah Martin. “Nothing was done proactively, and still to this day we aren’t getting the full story.”
NDP MP Gord Johns said he understands the explanation for the sole-source contract, but he believes the government should have found a way to eventually bring the program into the public service rather than rely on outside contractors for years.
“It certainly demonstrates the lack of capacity and ability to pivot within the federal government,” he said.
The Finance Department said Accenture currently has 129 employees working on CEBA. Four are based in the United States, and the rest are in Canada. EDC said it has 15 staff working on the program.
Chris Hannay