Canadian government IT agency flags digital risks and opportunities
In a briefing for Joel Lightbound, minister of government transformation, public works and procurement, leaders at Shared Services Canada (SSC) have outlined key challenges and opportunities for government digital transformation.
Lightbound’s appointment was announced in May, expanding the job title, which was previously minister of public services and procurement.
In transition materials published in August, Scott Jones, president of Shared Services Canada, and Raj Thuppal, executive vice-president, said: “While SSC is providing tangible results, there remains significant room to do better.”
They said that by shifting the business model from siloed and decentralised to a government-wide approach, SSC has reduced costs, boosted reliability and strengthened security. They flagged achievements including blocking over six trillion malicious cyber activities through work with the Canadian Centre for Cyber Security, and exceeding the government’s target of allocating 5% of contracts to Indigenous businesses.
However, they said: “Our single greatest risk remains the unhealthy applications within the Government of Canada as noted by the auditor general of Canada.”
A 2023 report by the auditor general found that only 38% of government IT applications were healthy, meaning the rest were at risk of failure. The report said that if progress continued at the same pace, only 45% of applications would be healthy by 2030, which would fail to meet the 60% target set by the Treasury Board.
This year’s AccelerateGOV conference, co-hosted by the Government of Canada, will take place on December 9, sharing insights from governments around the world on how to deliver better, more efficient and resilient digitally-enabled public services with public servants from Canada and beyond.
This event is an opportunity to learn from government innovators, and will explore real-world transformation use cases in an increasingly complex and fast-changing world.
Find out more about the event and register to attend here
Risks
Key risks facing SSC and its work identified in the briefing include “vendor lock-in and rising costs”. While relying on a small number of providers’ products or services limits flexibility and makes it difficult to negotiate better terms, SSC acknowledged that migrating to other platforms and managing multiple providers may not always be more cost-effective than having a single provider.
“SSC balances these considerations on a case-by-case basis,” the briefing said.
In addition, it notes that: “Shifting market dynamics, including consolidation and vendor lock-in, could result in delayed contract awards, higher costs, reduced flexibility, and significant challenges for SSC in transitioning to alternative providers or replicating solutions internally.”
The briefing also points to “misalignment of incentives” across government departments to prioritise the replacement of legacy infrastructure and adds that “unequal cost-sharing and commitment to modernisation may hinder the pace of digital transformation”.
According to SSC, adoption of emerging technologies such as AI may increase technological vulnerabilities and interoperability issues, increase demand on infrastructure, hinder scalability, and lead to higher costs.
Further, the department warns that: “A changing fiscal environment may impact revenues and jeopardise planned investments and modernisation projects.”
It adds that the combination of inflationary pressures and rising IT infrastructure costs, particularly in cloud services and hardware, can threaten the sustainability of critical digital transformation initiatives.
“Volatility in public cloud pricing and an increased reliance on cloud technologies could impact budgets and reduce flexibility in scaling operations efficiently,” it says.
Additional risks include more frequent and sophisticated cybersecurity attacks; increasing demand for digital services and their timely delivery; and skills constraints.
“The rapidly changing IT environment will require employees to develop new and different skillsets,” the briefing says. “Without the upskilling of SSC’s current workforce, there will be knowledge gaps that could lead to delays in innovation and ability to meet partner and client needs in a timely and cost-effective manner.”
Opportunities
The department also pinpoints opportunities as well as challenges, with digital sovereignty being chief among them. This refers to a country’s ability to govern its own data, infrastructure and technology. Initiatives include the Policy on Service and Digital, which integrates privacy and data residency requirements, and an IT diversification strategy.
SSC is also looking at moving more enterprise-wide applications to the Government of Canada Application Platform as a Service (GCaPaaS), a centrally managed cloud-based solution for standardised enterprise applications. “By centrally managing the infrastructure, software tools and services, GCaPaaS makes it easier for partners to leverage and consume applications quickly,” the briefing says. “This structure provides a cost-effective way to provide common tools across the [government].”
Other opportunities include the development of an Enterprise Desktop Service by SSC to standardise IT asset management and support services, and a ‘softphone everywhere’ approach where software allows users to place and receive calls without a dedicated telephone device or plan.
In 2023-24, SSC procured CAN$4.3bn (US$3.1bn) of goods and services on behalf of departments and agencies including SSC itself.
“Looking ahead, SSC will continue to modernise costly and vulnerable legacy systems; advance reliable, secure and integrated enterprise services; and decrease vendor concentration through diversification efforts,” Jones and Thuppal said. “We will also continue to implement cost-saving measures to ensure public dollars are spent as effectively as possible, allowing for reinvestment within SSC in key areas, including accelerating AI adoption, eliminating duplication, and phasing out outdated and costly legacy applications across the Government of Canada.”
In June 2025, SSC released its 2025-2026 departmental plan, outlining actions to continue IT modernisation. This includes implementing the 2024 Application Hosting Strategy. The approach focuses on choosing the most suitable hosting model for applications, “based on cost effectiveness and business value, to deliver digital services to Canadians”.
Read more: Most Canadians want government to regulate AI, poll finds
About Sarah Wray
Sarah has over 15 years’ experience as a journalist with a specialism in the public sector and topics such as digitalisation and climate action. Sarah was formerly the editor of Cities Today and Smart Cities World, as well as a specialist video-based publication in the aerospace sector. She has also written for publications including Smart Cities Dive, Mobile Europe, Mobile World Live and Computer Weekly.
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