Stocking stuffers

'Twas the night before Christmas, and all through the house, not a creature was stirring - except the clever elves at Community Living British Columbia. On December 19, the agency quietly announced it would be directly awarding $304,815 worth of contracts to eight separate firms. Ho! Ho! Ho! Of course, a number of those contracts are extensions to existing agency favourites. And some of the companies receiving awards went through earlier competitive bid processes. But, according to documents posted on BC Bid, three didn't - Gateway Consulting Services Ltd. ($35,000), L. Guest Management and Project Consulting Ltd. ($29,750) and TP Systems Ltd. ($30,000) - apparently because they are the only firms capable of meeting the agency's demanding information technology needs. And what do we know about these companies, you may ask? Quite a bit, it turns out.

Astute Public Eye readers will remember Lucy Guest, the sole director of L. Guest Management and Product Consulting, made headlines in February 2004 when the Times Colonist's Lindsay Kines discovered the ministry of children and family development had awarded her $146,700 in untendered contracts. At the time, then minister Christy Clark said she was "concerned about the appearance" of those contracts. And she announced that Ms. Guest's work was being converted into a regular unionized government position because the ministry found it could get the services cheaper that way.

TP Systems was also in the news back in 1997. At the time, The Vancouver Sun's Rick Ouston reported government auditors were complaining about the financial practices of British Columbia's photo radar program. Specifically, they were concern about the "modification of contract amounts to reduce value below $100,000" - ensuring they wouldn't be reviewing by the government Treasury Board - and the awarding of "multiple contracts to the same provider." And it turns out one of those providers was TP Systems - which was issued 14 contracts worth $909,806.

As for Gateway Consulting Services, their staff includes a number of former children and family development staffers including senior analyst and database specialist Dianne Grehan and information systems director Sandy Logan. Fred Milowsky, British Columbia's deputy child and youth officer, is also presently on leave from his post as a consultant with the company.

6 Comments

So why have friends if they can't cut a deal so you can make more money? Seems to work for the New Era guys, gals, and friends

DL:

Most of these folks weremaking a mint in government contracts long before the BC Liberals showed up, so I wouldn't moralize too much. The facts will bite you in the ass.

The simple fact is that the worst forms of patronage in government don't happen at the political level, because there is accountability at that level. They happen at the bureaucratic level between bureaucrats and former bureaucrats in the form of extremly lucrative consulting contracts. That has been happening for years, including when the NDP were in power.

So just when did these folks start making all those contracts if it was before the New Era gang's time? Give us a few examples of these companies. Dtaes would be nice as well. If you can come up with the numbers maybe the facts as you call them will bite.

Well, Fred Milowsky used to be the CEO/Regional Executive Director (RED) for MCFD Vancouver/Coastal. He's apparently done quite well for himself since he helped decimate his region, what with the Deputy Officer gig, and the consulting contract.

But in all fairness, I have to agree, consultant contracts didn't get invented with the Liberals. Like Mr. Milowsky and the above mentioned folk would be able to tell you, it's always been about "who" & "what" you know that helps plump up the old bank account. Besides, they're so far removed from the mayhem & suffering what do they care anyways?

The real story is what are all the contracts for? Helping get ready to "devolve" the rest of MCFD?
If we look at the MCFD Resource Summary for the Annual Service Plan, staffing goes from 2,557 in the 2006/07 Plan to 53 in the 2007/08 Plan. Are these new consultant contracts going to help MCFD carve up some, or the rest of the Ministry?

http://www.bcbudget.gov.bc.ca/sp/cfd/ResourceSummary4.htm

Here's another little score for Mr. Milowsky:

Milowsky, Fred, (September 30, 2004). An Operational Examination of the Community Living Service Delivery Model.
http://www.communitylivingbc.ca/pdfs/milowsky_finalreport_sept30_04.pdf

Concerned Citizen's question (what are the contracts for?) assumes that the job is done at CLBC because "devolution" happened in July 05. Not even close! Even the Deputy has admitted it will be YEARS before CLBC is ready to independently handle the duties formally handed over on July 1--they're still setting up their basic admin systems!

This spring, after four years and millions invested, with CLBC still miles away from ready, the ghost of Doug Walls hanging over them and the prospect of a functioning Opposition looming, the Liberals realized this was a powderkeg waiting to be lit. So they ignored all the expert advice and readiness criteria (including Milowski's) and just announced the official "devolution" (so hastily that their PR announcements came out days or weeks after the fact!) while MCFD continued to run everything pretty much as before, except with staff officially assigned to a new organizational structure (CLBC) that exists in little but name. (This also allowed them to claim a "no risk" devolution because all the risks were postponed until the real structural changes that will now have to occur post-devolution. It was a brilliant political strategy, but that was about it.)

But the PR folks, along with Rick Mowles and his CLBC execs, are going to be very unhappy to hear you people calling them "the bureaucrats". The whole point of creating CLBC, as they assured us repeatedly, was to take community living out of the hands of the bureaucrats, creating a business model that would spend available dollars more effectively, and "empowering" us families, individuals and the community by putting us in charge of our own lives.

The real question to ask is just how many tens (hundreds?) of millions have been spent since 2001 and what have they got to show for it? How has the client population benefited (or perhaps more to the point, what have they actually lost?) That's the question I've been asking the Minister since 2003, when a Ministry "Fact Sheet" said they'd already spent $100 mill in the first year. I've yet to get a straight answer, but I'd love to see someone with more clout than me take a stab at it.

We know they've spent millions on IT alone since 2001. After all, "electronic service delivery" was the centrepiece of the Doug Walls plan--the magic bullet that would allow community living to deliver 20% budget savings to meet the Liberals' budget slashing targets. And we know that went absolutely nowhere, so Plan B continues to focus on how to get away with kicking people out of their group homes to cut costs. And we know that when MCFD formally handed over 16,000-odd clients to CLBC on July 1, 2005, they still didn't know exactly who they were serving. A month later, CLBC was asking the contractors to tell them who they were serving and what services they were getting.

John English is absolutely correct in stating that patronage at this level is done by the mid level managers and not the elected politicians.

There is no doubt in my mind that a good portion of the money gets wasted due to plain ordinary corruption and graft, but the majority is lost due to pure laziness and incompetence.

Having known people working in the IT industry for years, I can tell you that "organizing" contracts and awards to avoid the tendering process is the norm and not the exception. The rational is usually that company A or consultant B has specialized knowledge and therefore it would not be cost effective to go elsewhere. Well if you never look elsewhere then how would you know?

The net result (as the auditor general pointed out years ago) is that about a third of all money spent in IT consulting contracts is wasted with absolutely no value received for it, while most of the rest has questionable value. The main problem is that the people awarding the contracts have no competitive measures to compare against and are most often too lazy to properly spec out the work. The consultants charge inflated prices, put the lowest qualified staff in place to do the work and then make a killing on extras and change requests because the project was never defined properly in the first place.

Since many Government managers are quite willing to spend any amount of taxpayer dollars to avoid having themselves look bad, money keeps getting poured down a black hole until there is some outcome that is passable or the project has gone on so long that the service or product is no longer required and it can be quietly quashed.

The only thing that suprises me about Sean's article is that the consultants haven't yet figured out how to hide their identities from prying eyes. You would at least think that they could go to the effort of setting up a new numbered company for each passing of the hat. I guess they don't need to worry about getting caught with their hands in the cookie jar as nothing will get done about it anyways!

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