The federal contract portion of Ottawa’s “Buy Canadian” policy went into effect Dec. 16, prioritizing the use of Canadian materials in fulfilling federal contracts.
The policy gives preference to bids on federal contracts of $25 million or more that use Canadian content and require federal construction and defense contracts of $25 million or more to use Canadian-made steel, aluminum, and wood in any projects requiring at least $250,000 of materials.
“Supply chain disruptions and recent economic shocks are directly impacting our industries and workers. In many industries, Canadian businesses are struggling to obtain essential materials due to tariffs that are slowing production and threatening jobs,” Procurement Minister Joël Lightbound said in French during a Dec. 16 announcement, accompanied by Liberal MPs Natilien Joseph, Bienvenu-Olivier Ntumba, and Jacques Ramsay.
“It is in this context that we must prioritize our industries, protect our workers, support our businesses, and strengthen our economy. It is in this context that we must invest and build major projects. But we must do so with our expertise, our people, and our resources,” Lightbound added.
The new policy applies to applies to federal departments and agencies and to procurement associated with grants and contributions programs, as well as projects coordinated through the government’s recently launched Major Projects Office and housing offices, defence procurement, and community infrastructure projects funded by the federal government. The Ministry of Public Services and Procurement noted it will also be applied, where possible, “to Crown corporations and their subsidiaries.”
“This policy creates demand across the country, from steelworkers in Hamilton to aluminum producers in Saguenay—Lac-Saint-Jean and lumber mills in La Tuque and Prince George, while giving clear advantages to suppliers who invest, innovate and produce here at home,” Lightbound said in a statement issued Dec. 16.
While the first phase of the federal contract policy that came into effect Dec. 16 prioritizes Canadian businesses and materials for projects of $25 million or more, phase two in the spring of next year is slated to expand to include all contracts valued at $5 million or more. Last year, Ottawa handed out $66.9 billion in contracts for goods, services, and construction, of which the vast majority, $55.6 billion, was awarded by Lightbound’s Ministry of Public Services and Procurement.
This past July, Lightbound also announced that Canada’s Interim Policy on Reciprocal Procurement was going into effect. The policy prioritizes suppliers for government contracts from Canada and countries that provide reciprocal access to Canadian suppliers via trade agreements.
Under the policy, Ottawa can also bar suppliers from countries who limit Canadian access to their own government contracts from bidding on Canadian government contracts.
The Canadian Press contributed to this report.
