Canada's Randy Scandal illustrates why DEI politics and government contracting should be kept separate.
The Randy Boissonnault saga shows why identity politics and federal contracts shouldn’t mix | The Hub | Sabrina Maddeaux:
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Randy Boissonnault in 2018. Photo by
November 22, 2024 - "It takes more than your average scandal to get a cabinet minister removed from Prime Minister Justin Trudeau’s government.... But Randy Boissonnault, the now-former Employment minister, finally managed this practically unheard-of feat. On Wednesday, Trudeau announced Boissonnault would 'step away from cabinet effective immediately.' This comes after months of scrutiny on his former business Global Health Imports (GHI), which claimed to be 'Indigenous-owned' in bids for federal contracts even as Boissonnault’s Indigenous heritage claims shifted wildly.
"The saga and its fallout should extend far beyond Boissonnault and GHI, which are merely the most publicly recognizable tips of the iceberg that is the government’s Indigenous business procurement targets. These affirmative action style mandates should be scrapped, along with the very idea that government contracts should be awarded to favour certain identities.
"In 2021, Trudeau’s Liberals announced that a minimum of 5 percent of all federal department and agency contracts must go to Indigenous businesses. Even prior to these targets, a business’ inclusion in the government’s Indigenous Business Directory meant favourable treatment and limited competition for some contracts. However, like many well-intentioned, poorly executed diversity initiatives, ... such programs create perverse incentives to cheat the system, are practically impossible to audit at scale, and often fail to help the communities they claim to serve. Moreover, they fail to guarantee top value for taxpayer dollars....
"There have been other high-profile reports of alleged fraud and misrepresentations of Indigenous ownership that did result in major federal contracts. The most notable is the ArriveCan app, which saw a $7.9 million contract go to Dalian Enterprises Inc, self-described as 'Aboriginally owned, veteran operated.' The company has received more than $200 million in federal contracts since 2015, although it’s now suspended from working on existing contracts or bidding for new ones.... {I]t’s alleged Dalian, after securing a government contract, would [disburse] government funds and the work to other, non-Indigenous contractors. Indeed, when questioned by MPs about his firm’s work on ArriveCan, Dalian’s president and founder could barely articulate what his company did on the project and admitted to typically subcontracting out federal work to other companies. There have also been questions about the validity of his [indigenous] heritage claims....
"In 2016, it was discovered that Canadian Health Care Agency (CHCA), a major nursing contractor for remote and Indigenous communities, got itself listed on the federal Indigenous Business Directory by entering into a partnership with a one-person foot-care company owned by a First Nations nurse. However, the nurse had next to no say in the company and, worse, was eventually pinned with a $500,000 tax bill when the arrangement was audited. While CHCA was removed from the Indigenous Business Directory as of 2019, ... [i]t has since received at least 30 contracts from Indigenous Services Canada, totalling $131.7 million....
"Indigenous leaders themselves are ringing the alarm that the federal government’s Procurement Strategy for Indigenous Business (PSIB) is deeply flawed. In September, Assembly of First Nations (AFN) Regional Chief Joanna Bernard told a House committee, 'There is currently no consistent way of verifying the legitimacy of Indigenous businesses, which creates a risk of false claims, tokenism … [and] exploitation [by] bad actors.'
"While some may argue for increased auditing or different methods of identity verification, the reality is neither are realistic solutions. The federal government simply doesn’t have the capacity to —nor should it dedicate mass resources to — successfully audit a program that incentivizes fraud by being based on difficult-to-verify identity claims and ownership percentages.... We simply don’t know how much of the massive amount of public money earmarked for Indigenous contracts actually flows to Indigenous entrepreneurs.... The government isn’t able to assure the public their taxes aren’t going to frauds and frontmen, let alone that we get the best value and outcomes from the best companies for our money....
"Boissonnault’s time in cabinet didn’t end with the legacy he hoped, but it would be a shame for such a scandal to go to waste, used only for partisan barbs rather than a push for much-needed, common-sense reform. Procurement may be a typically wonkish topic, but it couldn’t be more vital to how Canadians experience government and access services. Federal policy must abandon its misguided adventures in identity politics to laser-focus on results."
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