Contemplate this on the tree of woe

Earlier today, Public Eye reported the premier's office awarded an open-ended contract that paid out $343,425 in fees for services to PACE Communications Group Inc. without competition. This, despite a confidential government memo stating "a formal RFP process must be used for contracts over $100,000." Government has defended that award by saying the instructions in the memo were meant as guidelines or best-practices not hard-and-fast rules. Well, let us all think about that position a bit while we read this excerpt from another memo - this one dated May 29, 2002 - that was sent by then finance deputy minister Paul Taylor and management services deputy minister Catherine Read to fellow top bureaucrats.

It reads: "One issue of immediate concern is the direct award of contracts. Current policy, applicable to all ministries, requires contracts of an expected value of $25,000 or greater to be competed. Only in exceptional circumstances may this policy be set aside. These include unforeseeable emergencies, security concerns, the protection of life and health, confidentiality requirements, or where a ministry can demonstrate that only one supplier is qualified to perform the services." The following is a complete copy of that leaked memo.

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British Columbia
Ref 9325
May 29, 2002

To: Deputy Ministers

We are writing to seek your active support in ensuring that the Government's New Era commitment to fair and open tendering is understood and implemented. Competitive processes need to be followed, and ultimately Deputy Ministers are accountable to ensure that procurement processes within their ministry are carried out fairly and openly, consistent with government policy.

All staff respon sible for procurement activity should be familiar with current government policy on contracting as provided in the General Management Operating Policy Manual. They should also have the appropriate skills and abilities required to carry out their responsibilities effectively. Training is available through courses including: Managing Government Contracts.

One issue of immediate concern is the direct award of contracts. Current policy applicable to all ministries, requires contracts of an expected value of $25,000 or greater to be competed. Only in exceptional circumstances may this policy be set aside. These include unforeseeable emergencies, security concerns, the protection of life and health, confidentiality requirements, or where a ministry can demonstrate that only one supplier is qualified to perform the services.

In the case where only one supplier is qualified and the contract is expected to be greater than $50,000, a Notice of Intent to direct award must be posted, preferably on the BCBid website. This should only be done where due dilligence to determine if the supplier is the only one qualified has been done. Valid objections must result in a competitive process.

In most cases, BCBid is the preferred means by which ministries are to post contract opportunities. It is important to ensure that the specifications used to define requirements are not to be written in such a way as to unfairly exclude potential valid suppliers.

Policy requirements are provided in detail in the General Management Operating Policy Manual and the Purchasing Commission is available to interpret procurement policy.

Please ensure the procurement practices employed by your Ministry support government's commitment to fair and open tendering and are consistent with government policy. It is suggested that you discuss this issue with your executive committee and that appropriate communication be provided to all staff engage in the letting of contracts.

Sincerely

Catharine Read
Deputy Minister
Ministry of Management Services

Paul Taylor
Deputy Minister
Ministry of Finance

Cc: Executive Financial Officers
Senior Financial Officers

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