The Honourable Filomena Tassi, Minister of Public Services and Procurement, has announced the launch of the Supplier Diversity Action Plan. The Plan outlines concrete steps to increase the participation of businesses from underrepresented groups in federal procurement.

As a cornerstone of the Plan, Public Services and Procurement Canada (PSPC) has developed a Policy on Social Procurement, which articulates how the department will use procurement as a vehicle to reduce barriers, increase supplier diversity and enhance economic and social opportunities for underrepresented groups.

The Supplier Diversity Action Plan also includes enhanced services, delivered through Procurement Assistance Canada (formerly the Office of Small and Medium Enterprises), to help underrepresented groups successfully participate in federal procurement.

Background

The federal government spends about $22 billion per year and as the central purchaser for the Government of Canada, Public Services and Procurement Canada (PSPC) annually manages the procurement of goods and services valued at approximately $15 billion. Through its Better Buying initiative, PSPC is improving procurement, both for government purchasers and businesses supplying goods and services. A key part of Better Buying is increasing the participation of businesses from underrepresented groups in government procurement, which is being advanced through the Supplier Diversity Action Plan.

Budget 2021 reconfirmed the government’s commitment to supplier diversity with funding to support procurement opportunities for specific communities. For example, investments will allow PSPC to implement a program focused on procuring from Black-owned businesses. This and the other elements of the Supplier Diversity Action Plan will help build a more inclusive economy and boost the competitiveness and prosperity of Canadian businesses.

Continual testing for ongoing improvement

Since 2018, PSPC has been using pilot projects to test how to best provide procurement opportunities for underrepresented groups. Through these pilots, which have led to actual contracts, we have learned a lot about some of the barriers faced by underrepresented groups, as well as the support they may require when competing for federal contracts.

As part of these pilot projects, specific pilots have been run targeting women, persons with disabilities and racialized Canadians. Recently, PSPC administered a Black Business Procurement Pilot to expand procurement opportunities for Black entrepreneurs. This pilot included 12 procurement opportunities across Canada aimed at Canadian Black businesses. Feedback from the Black Business Procurement Pilot is being used to inform the development of social procurement and supplier diversity initiatives, including a program focused on procuring from Black-owned or -led businesses as noted in Budget 2021.

In addition, PSPC is currently working closely with Black-led organizations and Black entrepreneurs from across Canada to learn more about their experiences with federal procurement. As part of this work, PSPC is invited Canadian Black-owned or -led businesses to complete an online questionnaire through a request for information (RFI) in June 2021 to provide information about their businesses and their experience with federal procurement. The results of the RFIare helping us develop initiatives to increase the participation of Black businesses in federal procurement opportunities.

As part of our ongoing efforts to engage with other underrepresented groups, PSPC launched a similar request for information on November 30, 2021, to obtain information on businesses owned or led by persons with disabilities. We also launched a third request for information on December 8, 2021, to obtain information on procurement experiences from members of the Lesbian, Gay, Bisexual, Trans, Queer or Questioning, Two-Spirit and additional sexual orientations and gender identities (LGBTQ2+) community. These 2 RFIs will ensure PSPC gets feedback directly from business owners and leaders in these 2 specific communities on their experience with the federal procurement process and their business environment, ensuring departmental initiatives reflect the realities and needs of their businesses.

Policy on Social Procurement (spring 2021)

PSPC is building on the lessons learned from the pilots and is implementing a Policy on Social Procurement, which came into effect on May 3, 2021. We are transforming procurement to meet departmental commitments toward diversity, inclusion, procurement modernization and the achievement of socio-economic policy goals, while fighting COVID-19 and rebuilding the economy.

This policy establishes a clear, public statement of direction on the part of the department to leverage government purchasing power to achieve socio-economic objectives and increase supplier diversity. The policy will contribute to increasing the diversity of suppliers and reducing barriers and enhancing economic and social opportunities for underrepresented groups, such as Black and racialized Canadians, women and LGBTQ2+ Canadians. The policy applies to all procurements led by PSPC, including those on behalf of client departments. It allows PSPC to enhance best value by considering both financial and non-financial factors in its procurement decisions. Under the policy, contracting authorities, in cooperation with the client, should consider where socio-economic measures could be included in each procurement. With this Policy, PSPC is transforming procurement to meet departmental commitments toward diversity, inclusion, procurement modernization, and the achievement of socio-economic policy goals. Moreover, the implementation of the policy is the first step toward establishing a Program on Social Procurement, which aims to enhance our supplier diversity.

Development of a Program on Social Procurement (winter 2022)

PSPC is developing a Program on Social Procurement to outline how the policy will be implemented. This will also be an opportunity to engage with industry, underrepresented groups, businesses and associations, as well as the procurement community, other government departments, the Parliamentary Black Caucus, the Federal Black Employee Caucus (FBEC), LGBTQ2+ representatives, racialized Canadians and networks for employees with disabilities to identify expectations, challenges, and measures of success. We will also solicit feedback and lessons learned from industry associations and businesses. The Program on Social Procurement will articulate how to incorporate socio-economic objectives into procurement by:

• leveraging existing opportunities within the legislative, regulatory, and policy framework that enable and encourage the inclusion of socio-economic objectives

• identifying procurements where best value can be enhanced through the inclusion of socio-economic objectives

• determining the appropriate procurement strategy

• determining how and when to use the relevant set-aside provisions in the trade agreements

• addressing issues such as data collection, and subcontracting

Suppliers in underrepresented groups will also have increased access to federal procurement opportunities.

Development of the program will include options around identification and certification of underrepresented suppliers. For its social procurement pilots so far, PSPC has used a self-certification process where bidders attest that they are owned or led by a person who identifies as a member of an underrepresented group. As third-party certification options exist, whereby organizations will certify that businesses are owned or led by an individual or individuals who are members of 1 or more underrepresented groups, these will be explored as part of the development of the Program.

PSPC will engage industry and underrepresented, groups, businesses and associations to develop the Program on Social Procurement, which will set out how best to incorporate socio-economic objectives into procurement.