Michael Pihach is an award-winning journalist with a keen interest in digital storytelling. In addition to PAX, Michael has also written for CBC Life, Ryerson University Magazine, IN Magazine, and DailyXtra.ca. Michael joins PAX after years of working at popular Canadian television shows, such as Steven and Chris, The Goods and The Marilyn Denis Show.
Prime Minister Justin Trudeau says the contracting process that went into building the now-optional ArriveCAN app seems “illogical” and “inefficient.”
Speaking to reporters at a press conference on Monday (Jan. 23), the PM said he has asked Canada's top public servant to review the government's procurement process for developing the travel tool, which is set to cost upwards of $54 million by this March.
Questions are swirling after the Globe and Mail exposed that Ottawa paid millions over two years to a company called GC Strategies, a two-person firm in Ottawa, for work related to the development of ArriveCAN.
The firm reportedly then subcontracted six other companies to do the work, including multinationals like BDO and KPMG, and kept a commission of between 15 and 30 per cent for themselves.
“It’s an atrocious abuse of public dollars,” NDP MP Matthew Green told the Globe.
He described the arrangement as disrespectful to the public service.
READ MORE: How the ArriveCAN app went from costing $80,000 to $54 million
“Here we are shovelling money out the back door to people who are running businesses out of their basements. It is scary," Green said.
Why did the public service just not hire those firms directly or develop the app in-house?
"That's exactly the question that I just asked of the public service," Trudeau said Monday.
$54 million by March
Trudeau’s remarks come as the contentious ArriveCAN app – first introduced as a mandatory requirement for entry into Canada in April 2020 and then made optional in September 2022 – faces a federal audit, which was passed by opposition MPs last November.
The parliamentary committee investigation stems from transparency concerns related to Ottawa’s outsourcing tactics – with GC Strategies being at the centre of it all.
ArriveCAN’s soaring costs are also raising eyebrows.
READ MORE: Opposition MPs pass motion calling for audit of ArriveCAN
Last October, it was revealed that the $80,000 it originally cost to create ArriveCAN will balloon to at least $54 million by March 2023, according to a cost breakdown released to media at the time.
The drama has dragged on into the new year after the Canada Border Services Agency (CBSA), last November, missed a key deadline for submitting invoices related to the development of the border app.
"During the pandemic, speed was [of] an essence, helping people quickly was [of] an essence, but there are principles that we should make sure are sound moving forward," Trudeau said yesterday.
The PM has asked the Privy Council to look at the government's procurement practices to make sure they are getting good value for money spent.
"To be clear, we did not build ArriveCAN"
Before it was made optional, ArriveCAN faced heightened criticism from border communities, tourism groups, travel agent advocates and Conservative MPs who, for months, argued the platform was hindering the recovery of Canada’s travel industry.
Since last September, Ottawa has been promoting the app’s effectiveness, unveiling upgrades to the platform, such as the optional “Advance CBSA Declaration” feature.
This allows travellers to answer customs and immigration questions up to 72 hours in advance of flying into Canada – as a voluntary option.
ArriveCAN’s contracts are now laid out in documents tabled by the House of Commons government operations and estimates committee.
As reported by Global News, the documents show that GC Strategies paid the other companies to provide IT “resources,” with almost all employees charging daily rates of more than $1,200 — but many had a day rate of $1,500.
Speaking before the committee in November, GC Strategies’ managing partner, Kristian Firth, said they would have charged the government the industry standard, which he pegged “anywhere from 15 per cent to 30 per cent.”
Firth also confirmed that GC Strategies billed Ottawa $9 million over the two years it was contracted to work on ArriveCAN.
"To be clear, we did not build ArriveCAN. We were approached to provide a team for consideration to fulfil certain ArriveCAN requirements," Firth told a parliamentary committee last October.
"We are, however, very proud of the team we gave the Government of Canada, whom they managed and gave direction to throughout the project."
Don't miss a single travel story: subscribe to PAX today! Click here to follow PAX on Facebook.