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2021: Safe Vaccine Rollout, Supply Chain Integrity, Spending Accountability to Dominate Government Agenda

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Capital Perspectives - Newsletter

Procurement at all levels of government will remain in a state of flux as we move in to 2021.

As all countries quickly discovered, despite multinational trade and co-operation agreements, those with production facilities for personal protective equipment (PPE) or in-country suppliers of raw materials for production locked them down; those without were left scrambling for supplies and inventory. Governments world-wide invoked emergency buying protocols and national security exceptions from trade agreement rules, and quickly moved to sole-sourcing or limited tendering scenarios.

Everyone soon came to understand the definition of "critical infrastructure" extended far beyond our traditional view – food security and basic medical and cleaning supplies were an essential element in maintaining critical infrastructure integrity and functionality. We expect that this reset will remain a primary influencer of government contracting in the present and the near future.

Although some governments signalled an intention to return to normal procurement practices in mid-2020, this changed with the second wave of COVID infections. Many remain in "emergency response" mode, particularly with respect to goods and services related to PPE, medical services and supplies and, more recently, vaccines.

Government resources will continue to be strained by the unpredictable nature of the pandemic, as they seek to balance the management of pandemic response programs with the competing and equally important need return to regular program and service offerings in the "new normal" work environment.

We anticipate a greater focus on critical infrastructure procurements and supply-chain integrity assessments to ensure secure domestic sources of supply, or at least, increased stockpiling capacity. Suppliers should anticipate that supply-chain integrity assessments will become a more common part of the procurement process – suppliers of essential goods and services may see a requirement that their supply chain be located within Canada.

The requirement to assure value for money, combined with the cost of the government response to the pandemic, will necessarily mean spending cuts and re-evaluation of programs.

Suppliers who have contracted with governments as part of the pandemic response should be mindful that the government will be brought to account for its spending and will need to validate its actions. One thing is certain – spending accountability will be subject to audit.

Countries such as the US and the UK have already begun the auditing process. In Canada, the Auditor General has identified that her list of priorities does include the government's PPE acquisitions for health care workers, Canada's food supply and a more detailed look at the Canada Emergency Response Benefit (CERB).

Until the vaccine rollout is well underway and there exists solid data on the long-term immunity provided by the various vaccines, governments will remain focused on and preoccupied with overburdened health care systems, establishing a reliable vaccine supply and implementing vaccine strategies. Governments will be mindful that these strategies must appropriately and ethically balance the health and safety of Canadians with the need to return the nation's economy to full functionality in step with the rest of the world.

Marcia Mills is co-leader of the Fasken National Security Group and counsel for procurement, government contracts, trade and information technology in Fasken's Ottawa office. With over 20 years of private and public sector experience, she provides her public and private sector clients with legal and strategic advice for all aspects of tendering, procurement and government contracting, national security issues, and policy development and compliance programs.


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