Union of National Defence
Employees
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DEVELOPING A STRATEGY IN REGARD TO
DEFENCE CONSTRUCTION CANADA
AUGUST 17, 2011
Purpose of Presentation
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 Provide background information on Defence
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Construction Canada (DCC)
Provide some insight as to why National Defence
(DND) may use DCC
Findings and Issues discovered from site visits
Identify potential issues/challenges with the
DND/DCC relationship
Identify possible strategies to protect /enhance
CE/UNDE members’ positions
Background info on DCC
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 Defence Construction Canada formal name is Defence
Construction (1951) Ltd.
 Mandate, approved by Treasury Board through DCC’s
Annual Plan,
“….provide a wide variety of property-related services
to support the Department of National Defence in the
management of its facilities' infrastructure needs…”
 Mandate last reviewed in 2001 by Minister of PWGS and
was not changed
Background info on DCC
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 Services & number of employees continue to grow
– close to 90o people and still hiring
 DCC is funded 100% by DND – no other sources of
revenue
 Revenue level over $ 700 million (2009/10)–
 All profits/losses by DCC are returned/covered by
DND as part of next year budgeting process
DCC is an Agent Crown Corp
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 Reports through Minister of PWGS
 Own employer but looks like a government
department
 Are encouraged to adhere to most TB Policies
 Must follow Financial Admin Act (Sec 32/34)
 Auditor General of Canada is designated auditor for
DCC
Why DND uses DCC
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 Facility operations not core to DND mandate
 No staffing issues for DND
 No formal contract between DND and DCC – just a
MOU for services
 Payment to DCC comes from O&M budget and not
salary budget
 Perceived cost savings but no business case
 Back door method of downsizing
Site Visits and Findings
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 Team has visited several Bases/Support Areas;
Quebec, Ontario, Saskatchewan, others to be
arranged
 Consistent issues found at each location
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Growth of DCC in all areas
Limited/no hiring of CE staff
Increased time for RFPs
Some evidence of fraud – further investigation is required
Project charging issues
DND senior staff joining DCC
Where are the business cases to support use of DCC
Problems with increasing the use of DCC
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 CE employees increasingly out of loop, by-passed,
unable to complete assignments due to lack of
resources
 Quality of work, oversight of contractors, security
clearances for contractors’ staff
 No real consultation with existing staff/UNDE about
increasing use of DCC
 DND still accountable for facilities and projects but
has no “organization” to carry out due diligence role
Strategies to Consider for Protecting-Enhancing
Positions
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 Assume DCC is not going away , UNDE National
Executive to consider various strategies to approach
DND Management to discuss issue
 Need to be proactive in DND’s strategic review
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Set up UNDE/DND Committee to review DND custodian
management requirements/structure
Consider expanded roles for CE employees in area of contract
management
Return DCC to original role/mandate
Next Steps
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 Finalize site visits and information gathering – visits
can be arranged through Regional VP
 Continue to examine/analyze P3 contract for CSE
HQ in Ottawa – need to stop the trend
 Start to “build the movie” and be ready when
Parliament returns next month to demonstrate how
much DCC is really costing DND and Canadians