Canada takes steps to cut outsourcing costs
OTTAWA, CANADA — The Canadian government is taking steps to improve outsourcing practices and reduce spending on external consultants.
On October 5, Treasury Board President Anita Anand released a new guide for public service managers on contracting professional services.
The “Manager’s Guide: Key Considerations for Procuring Professional Services” outlines questions to evaluate the need for outsourcing and provides advice on risk management in contracts.
The move follows audits of McKinsey contracts that identified ways procurement practices could be strengthened. It also aligns with the 2023 budget’s proposed 15% reduction in spending on consulting and professional services.
Anand stated the guide will help ensure effective use of taxpayer dollars and careful spending management. All agencies are expected to apply the guidelines alongside procurement training.
Public sector unions have advocated reducing outsourcing, arguing it often provides lower-quality services. The Parliamentary Budget Officer also reported a 34% increase in professional services spending since 2017.
The guidelines follow an RCMP investigation into misconduct allegations regarding an outsourced CBSA IT project. Anand indicated she aims to be proactive on third-party contract management going forward.
Experts say more transparency and lobbying legislation is needed to curb excessive consulting fees in IT outsourcing. They recommend registering all consultant lobbying activities regardless of technical classification.
The government states contracted services remain necessary in some cases for expertise, flexibility, and workload management. However, the new guide and budget measures demonstrate a focus on tightening oversight and reducing overreliance on external consultants.
