Procurement of personal protective equipment: Standing Committee on Public Accounts—February 10, 2022

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The government is ensuring that suppliers are providing the personal protective equipment (PPE) that Canada requires and that sources of supply are free of unethical practices.


Supermax forced labour allegations is now a standalone note.

Suggested response

If pressed on the house domestic personal protective equipment motion (to note: PSPC does not supply masks to Parliament):

If pressed on TCG Medical:

If pressed on Tango Communications:

If pressed on Harbour Technologies due to gown delivery delays:

If pressed on the use of masks manufactured in China:


In this section

TCG Medical

On May 6, 2020, Public Services and Procurement Canada (PSPC) issued a contract to TCG Medical. The contract value was approx. [Redacted] CDN for the provision of [Redacted] N95 respirators. As per the contract, all goods were to be delivered on or before June 30, 2020.

By the fall of 2020, the supplier had failed to deliver the goods. In an effort to fulfill the contract, the government began working with the supplier to seek a resolution. Despite these efforts, the supplier was unable to provide an acceptable solution to fulfill the contract. As a result, PSPC terminated the N95 respirator contracts with the company for default, effective February 12, 2021.

On May 5, 2021, The Department of Justice, on behalf of PSPC, filed the Government of Canada’s statement of claim against TCG Medical in Ontario Superior Court seeking to fully recover all of the advanced payment plus legal costs for failure to fulfill the contract.

On July 28, 2021, TCG Medical filed their statement of defence and counter claim.


Tango Communications

In March 2020, PSPC awarded 3 contracts to Tango Communications totaling approximately $111 million for 37 million KN95 respirators, through emergency authorities within the department.

A significant percentage of the approximately 11 million KN95 respirators initially received in Canada from the supplier in April 2020 did not meet the mandatory technical requirements set out in the contracts.

As a result, in early May 2020, Canada took steps to suspend further shipments of KN95 respirators from the supplier.

Following the suspension of shipments, the government began working with the supplier to seek a resolution. Despite these efforts, the supplier was unable to consistently provide respirators that met the technical requirements of the contracts. As a result, PSPC terminated the 3 KN95 respirator contracts with the supplier for default, effective May 3, 2021

On May 6, 2021, the Department of Justice, on behalf of PSPC, filed the Government of Canada’s statement of claim against Tango in Ontario Superior Court seeking to fully recover the advanced payment plus legal costs for failure to fulfill the contract.

On August 13, 2021, Tango Communications filed their statement of defence and counter claim.


Harbour Technologies

Harbour Technologies signaled to PSPC in late July 2021 various supply chain issues they were encountering and followed up in August 2021 with official request for contract delivery extension up until March 2022.

An extension to November 30, 2021 was granted consistent with the approach to other gown suppliers extension approvals granted based on contract excusable delay clauses. Harbour Technologies agreed on September 24, 2021. PSPC did provide the opportunity to the supplier if they wished to terminate by mutual consent.

On October 28, 2021, the Department of Justice of Canada was served with an application for judicial review in the Federal Court by Harbour Technologies for the Court to compel Canada to re-consider a reasonable period of extension for the delivery under the contract based on the specific circumstances affecting the applicant and request to have a hearing before a judge before the December 30, 2021, delivery expiry date.

However, based on unpredictable environmental events and the subsequent transportation complications within the province of British Columbia, on December 13, 2021, Public Health Agency of Canada (PHAC) and PSPC approved a further delay in delivery of contracted goods up until March 31, 2022.



PSPC awarded a 10-year contract to Medicom for domestic production and distribution of surgical masks and N95 respirators for PHAC.

Production ramp up for N95 respirators began in August 2020. Medicom applied for Health Canada’s International Organization for Standardization (ISO) certification. Health Canada approval was obtained on October 30.

Medicom has also received quality assessment testing approval from PHAC on their N95 respirator.

Quality assessment testing is a standard requirement to confirm the masks meet the mandatory 95% filtration standard for N95 respirators. This quality assessment testing process was performed by the National Research Council (NRC), on behalf of PHAC.

NRC performed the testing using the filtration testing machine TSI8130A, which is the same machine used by the National Institute for Occupational Safety and Health (NIOSH) in the United States. Quality assessment testing typically takes 7 to 10 business days depending on the number of sample masks being tested. There is an extension for NIOSH approval until the end of June 2021.

While Medicom was finalizing quality assessment testing, they provided 700,000 FFP2 masks (N95 equivalent) from Europe. Medicom has provided PSPC with a delivery schedule for the N95 respirators. Deliveries began in November 2020.


PSPC entered into a contract directly with 3M Canada to purchase domestically-produced N95 masks. 3M had responded to a ‘call to industry’ posted by Innovation, Science and Economic Development Canada (ISED) seeking industry engagement on establishing domestic manufacturing of N95 masks in Canada. Five proposals were received, and the 3M proposal was selected as the best value to Canada.

Under the contract, 3M will provide 25 million N95 masks annually over an initial 5-year period (April 2021 to March 2026). Canada has also reserved the right to extend the contract by up to 5 optional years. 3M had notified PSPC that they had an additional 5 million masks that they could supply in the first year, which PSPC then purchased, bringing the year one deliveries to 30 million masks total.

Procurement of medical gowns


Public Services and Procurement Canada awarded 39 contracts to 27 suppliers for the supply of more than 153 million medical gowns of which more than 150 million have already been delivered. These gowns are worn by medical professionals as personal protective equipment in order to provide a barrier between the patient and the professional.

Suggested Response

If pressed on domestic suppliers:

If pressed on Harbour Technologies:

If pressed on Campbell Drug Stores:

If pressed on Roudel Medical and surgical supplies:


Medical gowns are hospital gowns worn by medical professionals as PPE in order to provide a barrier between patient and professional. Whereas patient gowns are flimsy often with exposed backs and arms, PPE gowns cover most of the exposed skin surfaces of the professional medics.

In the early days of the pandemic, there was a very high demand for gowns globally. Material usually used for the production of gowns was being diverted to the production of masks. Manufacturers had proposed alternative material for the production of gowns in Canada.

Product compliance is reviewed against the technical specifications released by the World Health Organization (WHO). All proposed gowns have been reviewed by the PHAC technical team. PHAC had implemented a robust quality assurance program. For domestic suppliers, samples were assessed before production and once they were delivered to PHAC and prior to distribution to provinces and territories.

Ventilator procurement


Recent questions have been raised about domestic contracting for ventilators.

Suggested response

If pressed on which companies will be affected by the reduction:

If pressed on whether FTI was affected:

If pressed on FTI:

If pressed on for the process that led to contract awards:


At the onset of the COVID-19 pandemic, Canada procured ventilators at a rate that would allow it to be oversupplied in the event there was a significant surge in COVID-19 cases and worst-case scenarios for disease infection occur. Canada’s initial approach was to secure contracts with manufacturers of commercial-off-the-shelf (COTS) ventilators. The Government of Canada procured approximately 3,000 COTS ventilators which were deployed.

In March/April 2020, PSPC entered into 8 non-competitive contracts with 6 suppliers using its emergency delegation. In May/June 2020, PSPC entered into 3 additional non-competitive contracts. Delivery dates under these contracts were not firm due to suppliers not being able to provide firm commitments in the face of increased global demand.

To secure ventilators, PSPC, PHAC and Innovation, Science and Economic Development Canada undertook a process to identify viable proposals to manufacture ventilators in Canada. As a result, Canada awarded 4 contracts to domestic manufacturers to produce 37,500 ventilators in Canada.

In the fall of 2020, it was becoming apparent that the quantities contracted by PSPC coupled with the quantities procured directly by provinces/territories indicated that Canada would have an oversupply of ventilators. In response to this, Canada proceeded to reduce the quantities required by terminating contracts for convenience with domestic manufacturers. In lieu of requiring, contracting and receiving 40,545 units at the onset of the requirement, Canada’s reduction resulted in only requiring and receiving 27,706 units.

Contract termination for convenience was actioned with the 4 domestic suppliers of which 1 is currently still in the final steps of the claims process.

Integrity in federal procurement during the COVID-19 pandemic


In the fast-paced and constantly evolving marketplace to secure necessary products and supplies to support the Government of Canada’s response to the pandemic, questions may arise as to the measures that Public Services and Procurement Canada has in place to protect the integrity of the federal procurement system during this period.

Suggested response


The Government of Canada has a framework of laws, regulations and policies in place to protect the integrity of the federal procurement system. PSPC administers several programs under this framework, including the government-wide Integrity Regime, the federal contracting fraud tip line, and increased oversight for the detection of bid-rigging.

The Integrity Regime is designed to help ensure that the government does business with ethical suppliers and incentivizes suppliers to ensure strong ethics and compliance frameworks. Under the regime, a supplier may be suspended or declared ineligible to do business with the government if, in the previous 3 years, it, members of its board of directors or its affiliates, have been charged with or convicted of one of the offences listed in the “Ineligibility and Suspension Policy” in Canada or a similar offence abroad.

Under the current Regime, 3 companies are ineligible to do business with the Government of Canada due to convictions for a listed offence (Les Entreprises Chatel Inc., R.M. Belanger Limited and Les Industries Garanties Limitée). One supplier has had their period of ineligibility reduced to 5 years pursuant to an administrative agreement which came into effect in December 2020 (Hickey Construction Ltd).

In 2018, the government announced its plans to enhance the Integrity Regime by increasing the number of triggers for debarment, broadening the scope of business ethics covered by the regime, and integrating greater flexibility within the debarment process. Following this announcement, there was considerable public discourse around corporate wrongdoing as well as governments’ response to such misconduct. As a result, the government announced that it was taking additional time to reassess elements of the proposed regime and potential next steps.

In the interim, the current “Ineligibility and Suspension Policy” remains in effect.

Mobile health units


As part of the Government of Canada’s immediate response to COVID-19, Public Services and Procurement Canada established contracts with Weatherhaven Global Resources Ltd. and SNC-Lavalin PAE Inc., for a value of up to $150 million and up to 10 mobile health units (MHUs) each. These 2 firms were contracted to design and deliver Canada’s mobile health units for their known strong logistical capabilities and their proven record to carry out this type of work.

Suggested response


With the COVID-19 pandemic affecting the world class medical infrastructure across the world (for example Italy and New York City), it became evident that Canada needed to prepare for the worst case scenario. It was apparent that waiting to start development of a MHU when a province or territory declared that they were overwhelmed and needed federal assistance would be too late. Immediate ordering of critical medical equipment and the development of a design for a workable MHU was required.

What is a mobile hospital unit

An MHU is a fully self-sufficient unit that can provide targeted care for persons with acute respiratory disease and distress. It was designed with the capability of providing a triage area, short stay evaluation area, 2 resuscitation bays, up to an 80 bed in-patient ward, up to a 20 bed intensive care unit (ICU), diagnostic imaging (portable x-ray), laboratory, pharmacy, and a separate low-risk zone which includes central supply and office space.

How the contractors were selected

The joint venture SNC-Lavalin PAE Inc. was identified due to their existing and past contracts in providing logistical support for building and maintaining military camps during military deployments (for example Kandahar, Afghanistan).

Weatherhaven Global Resources Ltd. was selected because of its existing contract to provide similar types of structures to the Department of National Defence for mobile headquarters and for Weatherhaven’s association with ATCO Ltd. and its strong logistics capabilities.

A limited tendering process between the 2 firms was initiated in order to move quickly during the initial stages of the pandemic. To ensure maximum flexibility, obtain different designs and guarantee back-up capacity, contracts were issued to both proponents.

Contract summary

Under the task-based contracts, the 2 contractors have developed designs, organized project management offices, bought medical equipment and consumables and are maintaining readiness for operations which includes doing required maintenance to keep the equipment ready for operations, warehousing of the equipment and structures, etc. To date, invoices totalling approximately $103.9M (including taxes) have been paid to Weatherhaven Global Solutions and approximately $79.5M (including taxes) to SNC-Lavalin PAE.


Weatherhaven was originally requested to provide 2 MHUs. As these were being deployed to Ontario, Public Safety Canada asked PSPC to order a third Weatherhaven MHU. This MHU model is completely self-sufficient and can be used within a host building or independently. At the same time that Public Safety Canada asked PSPC to order a third Weatherhaven MHU, it also asked PSPC to order a SNC-Lavalin PAE MHU to be available for deployment inside of an existing building (for example convention centre, arena).

Now that the 2 MHUs have been returned from Ontario, Canada has 3 MHUs ready for deployment. The oxygen concentration system of 1 MHU has been deployed to Stanton Territorial Hospital in Yellowknife, where it continues to support the operations of the hospital. There was early interest from Quebec and Alberta in deploying the federal MHUs but these provinces were able to address their needs in other ways.

Medical equipment and consumables for additional MHUs were initially bought and warehoused, which have since been made available to the Public Health Agency of Canada and the Department of National Defence for use as needs have evolved.

Canada is currently working on a plan to consolidate the warehousing and management of the existing mobile health units infrastructure, equipment and consumables, from the current 2 contracts into 1, which will provide ongoing efficiencies.

Essential Services Contingency Reserve


The Government of Canada created the Essential Services Contingency Reserve to provide access to personal protective equipment, non-medical masks and disinfection products to essential service sectors, the social sector, as well as organizations serving Indigenous communities.

Suggested response

If pressed on logistics and distribution:

If pressed on cost-recovery:

If pressed on inventory:


In summer of 2020, the Government of Canada established the Essential Services Contingency Reserve as a temporary measure to provide a backstop when PPE are unavailable on the marketplace. Operating since August 2020, it provides access to PPE to essential service sectors, the social sector, as well as organizations serving Indigenous communities.


Currently, items are being provided at cost to essential service sectors and at no cost to organizations serving Indigenous communities and social service sectors.

To be eligible, businesses or organizations must be from one of the 10 critical infrastructure sectors as identified in Public Safety Canada’s “Guidance on Essential services and Function in Canada during the COVID-19 Pandemic” (for example, energy and utilities, health, food).

Assessment criteria include:

The total value of products procured under the Essential Services Contingency Reserve is roughly $168 million. The Public Health Agency of Canada and other departments donated additional PPE to the inventory.

The Essential Services Contingency Reserve inventory has been mostly accessed by small and medium-sized enterprises.

Next steps

Given the current state of the pandemic, the escalating public health advice and the steady need for PPE, Public Services and Procurement Canada is proposing to optimize the use of the existing Essential Services Contingency Reserve inventory by increasing the visibility and making the remaining PPE inventory more accessible.

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