From Phoenix to ArriveCAN: How to fix federal information technology procurement

ArriveCAN was developed urgently in a very short time span – two months – in response to public health requirements to mitigate the spread of COVID-19 from international travel.  (File Photo: Focal Foto/Flickr, CC BY-NC 2.0)

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Two high-profile fiascos have left many Canadians deeply concerned about the federal government’s ability to acquire and manage the information technology needed to run a robust, modern bureaucracy at a reasonable cost. 

The auditor general’s report on the ArriveCAN app has called into question the government’s aptitude to manage information technology procurement at the highest level. Worse, the report is reminiscent of audits examining other large-scale projects, notably the Phoenix pay system and Employment and Social Development Canada’s benefits modernization system.  

Despite these projects happening at different times in different departments with different objectives, they suffered from identical symptoms: major delays and cost overruns.  

Spending on procurement of all kinds is sizeable. Given the demands of the ongoing digital transformation of government, these budgetary needs are likely to continue for some time. To put it into perspective, in 2023 the federal government spent $4.57 billion on IT procurement, second only to defence in total procurement spending.  

Getting it right is critical not only because of the dollar figures involved. Failures in IT procurement can lead to service failure for Canadians and, ultimately risk undermining the public’s overall confidence in government. 

From checking travelers to paying bureaucrats  

Despite having similar symptoms and failures, ArriveCAN, the Phoenix pay system and the benefits delivery modernization program each had a distinct approach to procurement. 

ArriveCAN was developed urgently in a very short time span – two months – in response to public health requirements to mitigate the spread of COVID-19 from international travel. This was made possible by introducing exceptional measures allowing flexibility in procurement processes.   

On the other hand, Phoenix and the benefits-delivery modernization projects were complex, large-scale projects with inherently high risks which were planned years in advance.  

Nevertheless, under the microscope of the auditor general, all three procurement programs suffered from similar shortcomings which led to their respective failures: inadequate accountabilities, lack of internal expertise, and changes in scope.  

In order to learn from these outcomes and to ensure future procurement programs do not suffer similar fates, four critical steps should be taken to address potential issues in the short-, medium- and long-term.  

1- More cooperation between top bureaucrats 

A committee of deputy ministers should be struck to conduct a system-wide analysis of federal IT procurement practices. The committee should be mandated to report to the Treasury Board within a year with concrete recommendations for reforms.  

This approach has not been taken in the past, as auditor general reports and other analyses have focused on specific project failings, and not viewed the overall federal system of IT procurement.   

The deputy ministers’ committee should consult a wide range of actors across the federal government, as well as IT vendors and the auditor general, to get the most complete picture of the system and its strengths, weaknesses and failings.  

By engaging the highest-ranking public servants in this committee, it signals a commitment to immediate action from the federal government to help restore public confidence in this file. 

2- Small and simple wins the day 

The adoption of private sector practices with proven effectiveness should be explored to address the gaps in the federal procurement process. The minimum viable product (MVP) approach is a commonly used model in the private tech industry. 

The MVP approach aims to design a product or service that tackles only the core essentials and to introduce it soon as possible. This means that an initial basic version of the product or service is completed quickly and provided to customers who give feedback for ongoing development.  

The MVP model helps control project scale and focuses on core functions. This addresses a key concern raised by the auditor general.  

This also helps to limit financial risk through incremental implementation and reduced upfront cost compared to fully designed project proposals. And, additional flexibility is built in to handle emerging priorities and changes can be efficiently integrated in project implementation.  

The MVP model has been successfully used in government procurement practices by the U.S. Department of Veterans Affairs (VA) in its modernization of veterans’ benefits. The VA first focused on providing essential services to veterans, collected user feedback and monitored effectiveness. Importantly, the project stayed within budget, ensured functionality of core features, factored in user feedback and today serves nine million U.S. veterans. 

3- Building in-house IT knowhow 

Another issue raised by the AG in all of these cases is the need to improve digital competency in the Canadian public service. Increased educational and training support provided for public servants should be mandated to address this gap.  

Courses in digital competency should be added to the Treasury Board mandatory training inventory for public servants involved in IT projects. To best utilize existing resources, it is recommended to use the digital academy offered through the Canada School of Public Service.  

The digital academy currently offers a series of courses which are relevant to digital competency and procurement. However, the introduction of more advanced offerings would be beneficial across the board.  

4- Reward improved performance 

Deputy ministers should be incentivized to adopt more effective practices and bring greater success to future technological procurements. Thus, annual performance pay should be tied to IT project success.  

This would address what the auditor general and others have repeatedly flagged as diffuse accountabilities and insufficient attention given to these projects by executive-level leaders. The government can correct this trend by sending a strong message that the success of IT projects is a high priority within and among federal departments. 

History seems to demonstrate that the procurement and adoption of new IT systems in the federal government was viewed as a technical niche of public administration. In fact, the success of these projects is core to government legitimacy. People increasingly access federal government benefits and services exclusively online or electronically – gone are the days of sending in forms by snail mail for the vast and growing majority.  

Ensuring tax dollars are used to guarantee quality, cost-effective interfaces between citizens and their government should be treated as a top priority in the 21st century.  

The recommendations in this article come from the gold medal team in this year’s National Annual Public Administration Case Competition, organized by the Canadian Association of Programs in Public Administration (CAPPA) and the Institute of Public Administration of Canada (IPAC). The authors are graduate students at the school of policy studies at Queen’s University, who competed against teams at 11 other graduate schools to generate policy solutions for a timely public policy issue.  Policy Options is a sponsor of the competition, which has been held since 2012.  

This article first appeared on Policy Options and is republished here under a Creative Commons license.