A number of federal departments and agencies have paid more than half a million dollars over the past several years in fees for cancelling contracts with various private companies, according to an Inquiry of Ministry.
“With regard to contracts that were cancelled by the government since January 1, 2019, broken down by department, agency, Crown corporation or other government entity: How many contracts have been cancelled [and] what is the total amount paid out in cancellation fees or penalties?” asked Conservative MP Dan Albas in the House on Jan. 30.
The federal government tabled its response shortly after in an Inquiry of Ministry, obtained by Blacklock’s Reporter, which stated that at least just under $530,000 in contract-cancellation fees and unavoidable charges have been accrued by federal offices since January 2019.
However, the document did not include an estimate of the total cancellation fees that have been paid out to contractors over the past few years by the Department of Public Works—which is Canada’s largest contracting agent.
The department wrote in the inquiry that all the information “is not systematically available” and “would require manual verification, which is not possible in the time allotted.”
Although it gave no total amount of cancellation fees, the department said it has cancelled over 320 contracts that had been approved for payment since 2019, citing “default,” “convenience of the Crown,” and “mutual consent” as cancellation reasons.
Other Contracts
Contract cancellation fees accrued by other federal offices and agencies include a lost deposit of over $14,200 paid by the Canadian Centre for Occupational Health and Safety in May 2020 for a conference at a hotel in Halifax that was cancelled due to pandemic lockdowns.Farm Credit Canada of Regina, a Crown bank, lost $6,481 it had paid for a videoconference that was abruptly cancelled on Sept. 19, 2022, because of “the announcement of the national day to mourn the Queen’s death.”
The inquiry also noted that the National Film Board has paid over $120,000 to cancel 80 contracts since 2019, and the Canadian Intergovernmental Conference Secretariat has paid over $110,000 since then cancelling 83 contracts.
The document said the federal Transportation Safety Board has cancelled just one contract since 2019, for which it paid a $258 cancellation fee.
