Canada’s public service has a proud tradition of delivering programs that support citizens through some of life’s most important moments, from accessing health services to navigating employment, benefits, and education. As expectations evolve and service delivery grows more complex, governments across the country are rightly focused on how to modernize programs while safeguarding public trust, accountability, and value for money.
One area that deserves renewed attention is how government procures services.
In The Mission-Driven Government: Leading a New Way with Outcome-Based Contracting, we explore how procurement models can better support government objectives by aligning contracts more closely with the outcomes Canadians care about most. The paper builds on an earlier Maximus discussion, In Citizen Services: It’s Canada’s Time to Lead a New Way, and reflects lessons drawn from Canadian experience and international best practice.
Today, most public-sector contracts remain input-based. They carefully define deliverables, technologies, staffing levels, and processes, ensuring clarity, fairness, and compliance. These principles are essential, and they have served governments well. But when input-based approaches become the default, they can unintentionally limit flexibility, slow innovation, and make it harder to adapt programs as citizen needs and technologies change.
Outcome-based contracting offers a complementary approach. Rather than prescribing how a service must be delivered or what processes or tools need to be used to deliver them, governments define what success looks like - improved access, higher satisfaction, stronger program integrity, or better long-term results - and hold partners accountable for achieving those outcomes.
This shift does not reduce government oversight. In fact, when applied thoughtfully, it can strengthen accountability by tying performance directly to mission results. It also allows experienced operators to bring forward proven innovations, including responsible uses of digital tools and artificial intelligence, to improve service quality and efficiency.
Internationally, this approach is already well established. The OECD has encouraged governments to move from compliance-focused procurement toward more strategic, outcome-driven models. New Zealand’s procurement rules promote results-based agreements. The United States has embedded performance-based acquisitions into its federal procurement framework. Countries such as Australia, Ireland, Finland, and the United Kingdom have demonstrated how outcome-based contracts can deliver measurable public value while managing risk responsibly.
Canada is well positioned to build on these lessons. While federal procurement emphasizes best value and socio-economic objectives, including strengthening domestic capacity, contracts often remain anchored to detailed technical requirements rather than mission outcomes. This creates an opportunity: by formalizing an outcome-based procurement framework, Canada could encourage innovation while preserving transparency, competition, and fairness.
Importantly, outcome-based contracting is not an all-or-nothing proposition. Hybrid models can balance stability and flexibility by setting baseline requirements where consistency is essential, while applying performance-based incentives in areas where programs must evolve. Service-level agreements still play a role, but as guardrails that support outcomes, not as ends in themselves.
Success depends on measuring the right things. As economists have long noted, when a measure becomes a target, it can lose its effectiveness. Contracts that reward speed, volume, or technical compliance alone may meet their metrics without improving the citizen experience. Outcome-based models require a more holistic view, one that reflects program goals, operational realities, and the lived experiences of Canadians.
Equally important is how these procurements are designed. Effective outcome-based contracting starts with conversation. Program leaders, operations teams, IT professionals, and private-sector partners each bring essential perspectives. Early engagement helps ensure that outcomes are realistic, measurable, and aligned with public priorities. It also draws on lessons from other jurisdictions and sectors, reducing risk and strengthening confidence.
In practice, outcome‑based procurement is as much a data alignment exercise as a contracting one. Outcome‑based procurement only works when governments establish a shared data strategy and governance model that allows all parties to agree on what success looks like and how it will be measured. Programs that get the data right from the start are far more likely to deliver credible, durable results.
At its core, procurement is a strategic tool. When aligned with mission outcomes, it can help governments modernize services, make better use of technology, and deliver results that matter, all while maintaining accountability to taxpayers.
Outcome-based contracting is not about changing government’s role. It is about enabling government to focus more clearly on what it seeks to achieve for Canadians, and structuring partnerships accordingly. As Canada continues to modernize its public services, this approach offers a practical, balanced way forward.
For more details, please visit: The Mission-Driven Government: Leading a New Way with Outcome-Based Contracting
-Michael Wilson, Vice President, Growth, Maximus Canada