Order Fixing June 9, 2025 as the Day on Which Part 18 of the Budget Implementation Act, 2005 Comes into Force: SI/2025-28

Canada Gazette, Part II, Volume 159, Number 7

Registration
SI/2025-28 March 26, 2025

BUDGET IMPLEMENTATION ACT, 2005

Order Fixing June 9, 2025 as the Day on Which Part 18 of the Budget Implementation Act, 2005 Comes into Force

P.C. 2025-300 March 7, 2025

Her Excellency the Governor General in Council, on the recommendation of the Minister of Public Works and Government Services, under section 125 of the Budget Implementation Act, 2005, chapter 30 of the Statutes of Canada, 2005, fixes June 9, 2025 as the day on which Part 18 of that Act comes into force.

EXPLANATORY NOTE

(This note is not part of the Order.)

Proposal

This Order in Council (Order), titled Expansion of Ministerial Delegation of Procurement Authority to Services and Construction, made pursuant to section 125 of the Budget Implementation Act, 2005, brings into force amendments to the Department of Public Works and Government Services Act (DPWGS Act) to provide the Minister of Public Works and Government Services (Minister of PWGS) with exclusive authority over services (e.g., consultant services) and construction (e.g., office renovations) procurements for the Government of Canada.

Objective

With exclusive authority over all three types of procurements (goods, services, and construction), the Minister of PWGS will advance modernization efforts by streamlining procurement activities through the consolidation of all procurement authorities under the Minister of PWGS and set conditions or revoke delegations where the Minister of PWGS has reason to believe that the legal framework for procurement has not been respected.

Background

In 1996, the DPWGS Act provided the Minister of PWGS with exclusive authority over goods procurements. In 2005, the Budget Implementation Act, 2005 (BIA 2005) introduced amendments to the DPWGS Act, with the intention to grant the Minister of PWGS exclusive authority over services, and construction procurements. At that time, the exclusive authority for federal goods procurement was centralized with the Minister of PWGS. The purpose of these amendments was to consolidate the authority for all procurements under the Minister of PWGS in order to streamline and enhance efficiencies in federal procurement.

The amendments introduced by the BIA 2005 were not brought into force upon Royal Assent primarily due to a lack of support from client departments and agencies regarding the potential impact on their operations. Client departments and agencies were concerned about losing authority and autonomy over their services and construction procurements, which they viewed as an unacceptable constraint on their operations. Resolving the complexities associated with implementing the amendments were not considered a priority at the time, therefore interest in bringing these amendments into force faded.

In 2007, the Minister of PWGS delegated goods procurement authority to client departments and agencies. The standard Delegation of Authority Instrument for goods allowed departments and agencies to conduct their own goods procurements up to a $25K limit and to engage in emergency contracting in accordance with Treasury Board (TB) policy limits. This delegation was provided to 24 Ministers overseeing 101 departments and agencies.

Since 2007, there have been no notable updates to the Delegation of Authority Instruments provided by the Minister of PWGS. Over the years, some client departments and agencies have been provided with supplementary goods procurement authorities following requests submitted to Public Works and Government Services Canada, also known as Public Services and Procurement Canada (PSPC). To date, 13 departments and agencies have requested and been granted increases to their goods procurement authority.

The Statutes Repeal Act requires departments to request a deferral from repeal for any amendments not brought into force within 10 years of enactment. Recognizing the potential benefits of the amendments introduced in the BIA 2005 and wishing to retain the option to bring them into force in the future should an opportunity arise, PSPC has sought a deferral from repeal for these amendments on a yearly basis since 2015. More recently, there was also a recognition that consolidating procurement authorities with the Minister of PWGS also gives the Minister of PWGS the ability to revoke delegations when the legal framework for procurement is not respected.

The TB Directive on the Management of Procurement (the Directive), which took effect in 2021, is the authoritative instrument that sets dollar-value contracting limits for departments and agencies on their authority to procure goods, services, and construction. Above these contracting limits, departments and agencies must seek approval from TB before entering into contracts. This requirement is in addition to any limits in any applicable delegation of procurement authority under the DPWGS Act.

With this Order, with the exception of 6 entities with legislated exceptions (e.g., Canada Revenue Agency, Election Canada, National Research Council), the vast majority of Government of Canada organizations are subject to the following limitations as it relates to their authority to procure goods, services, and construction:

  1. To procure goods: departments and agencies are unable to contract beyond the thresholds established in the Directive unless they seek and receive pre-approval from TB. Within that limit, departments and agencies must have sufficient delegated authority from the Minister of PWGS to procure goods. Procurements that exceed the delegated authority limit but are within the PSPC limits set out in the Directive, would be handled by PSPC. Where procurements exceed the PSPC limits set out in the Directive, PSPC will seek the necessary authority from TB on behalf of the department.
  2. To procure services, and construction: departments and agencies are unable to contract beyond the thresholds established in the Directive unless they seek and receive pre-approval from TB. Within those threshold limits, any procurements that exceed the delegated authority limits, but are within PSPC’s limits would be handled by PSPC. Where procurements exceed the PSPC limits set out in the Directive, PSPC will seek the necessary authority from TB on behalf of the department.

Beginning in 2023 and continuing into 2024, PSPC consulted client departments and agencies through various forums to assess their stance on the potential implementation of the BIA 2005 amendments. Clients expressed full support for the possibility, on the condition that PSPC delegate these authorities back to departments and agencies in order to maintain the current operational status quo for services, and construction procurements.

Implications

Administratively, this Order consolidates all procurement authorities under the responsibility of one Minister, namely the Minister of PWGS. Substantively, with the authority to delegate, and revoke delegations, PSPC takes on a central role in ensuring proper stewardship and oversight over the procurement function for all departments subject to the DPWGS Act.

Once all procurement authorities are centralized under the Minister of PWGS, steps will be taken to consolidate the delegation instrument for goods, services, and construction, streamlining procurement practices and enhancing efficiencies in federal procurement.

In addition, departments will continue to be encouraged to use standardized tools, templates, processes, and terms and conditions created by PSPC for all types of procurements (goods, services, and construction) and be reminded of their responsibility to ensure procurement activities are conducted according to the procurement legal framework and best practices.

The legal framework for procurement includes laws and regulations, agreements, policies, directives, procedures and guidelines. At the core are the Government Contracts Regulations created under the authority of the Treasury Board pursuant to the Financial Administration Act. Additionally, the Treasury Board Directive on the Management of Procurement outlines the obligations of federal organizations for acquiring goods, services, and construction services.

With these consolidated procurement authorities, the Minister of PWGS will be better positioned to use existing audit and oversight practices to monitor for compliance with the procurement legal framework and carry out enforcement actions, as required, in situations of non-compliance.

Bringing these amendments into force does not directly affect federal procurement. Since the Minister of PWGS will delegate these authorities back to client departments and agencies upon receiving them, the coming into force of the amendments provides for the consolidation of all procurement authorities under one Minister, namely the Minister of PWGS.

Consultation

Between March and July 2023, PSPC consulted federal departments and agencies to gather feedback on implementing the amendments to the DPWGS Act to grant PSPC exclusive authority over services, and construction procurement, in addition to gathering their recommendations on ways to improve the procurement of services, and construction.

A survey was sent to 34 departments and agencies, and in-person consultations were subsequently held with 26 departments representing a significant volume and value of federal procurements. Feedback received indicated broad support for the bringing into force of the amendments, as long as the authorities would be delegated back.

In addition to the one-on-one consultations that took place with 26 departments and agencies, extensive consultations have taken place since 2023 through various forums, namely:

The consultations were conducted on the implications of granting the Minister of PWGS exclusive authority over all types of procurements. Discussions covered the intent of the Minister to strengthen stewardship over the procurement function, the benefits of streamlining delegations authorities, and Minister’s ability to impose conditions or revoke delegations where the severity of certain situations would warrant such an action (e.g., legal framework for procurement was repeatedly and purposefully circumvented). Departments indicated they understood this and supported the enactment of the amendments.

Contact

Levent Ozmutlu
Director General
613‑325‑7601
Levent.Ozmutlu@tpsgc-pwgsc.gc.ca