Nunavut agencies not following rules in awarding contracts
Auditor general's report finds problems at Qulliq, housing corp and Community and Government Services
A new report from Canada’s auditor general has found that a Nunavut government department and two of its agencies don’t always follow the rules when it comes to awarding and administrating contracts.
The three government groups studied — the department of Community and Government Services, the Nunavut Housing Corporation and the Qulliq Energy Corporation — spent $206 million on contracts in the 2010-2011 fiscal year.
"The whole idea of spending public funds on contracting, the whole system is designed to encourage competitive contracting, so that people in the territory get fair access, can compete for those contracts, and also if you have a competitive market the expectation is you’ll get good value and you’ll also drive prices down," said assistant auditor general Ronnie Campbell.
The report found the NNI Policy — which states that qualified, Inuit-owned, local, or Nunavut-based businesses get a favourable bid adjustment of up to 21 per cent when competitive bids are evaluated — was not being applied consistently.
Rules for sole-sourcing a contract
- the goods, services, real property, or construction at issue in the contract are urgently required and delay would be injurious to the public interest;
- only one party is available and capable of performing the contract
- the value of the contract will not exceed $25,000 in the case of a contract for architectural or engineering services, or $5,000, in the case of any other type of contract.
- when a sole-source process is used, the contract authority is required to justify this decision and obtain Deputy Minister (or equivalent) approval for contracts over $5,000.
It also found that the rules for sole-sourcing contracts — when a contract is awarded without a public competition — were not consistently followed.
The report states Community and Government Services followed the rules on seven of 13 sole-source contracts examined. At the Nunavut Housing Corporation, it was one in 12, and at Qulliq, out of 12 sole-source contracts the auditor general’s office examined, none was awarded according to the rules.
The report found all competitive contracts for Community and Government Services and the majority for Qulliq Energy Corporation’s capital projects were awarded according to the rules. However, the Nunavut Housing Corporation was missing key documentation to support the awarding of half of its competitive contracts.
"It's a mixed bag of results," said Campbell. "There's some good stuff and there's some stuff that really, really needs to be improved upon in a big way."
The report cited familiar reasons for why contract awarding and administration is being done poorly: not enough employees and too few employees trained to do their jobs properly.
The report lays out recommendations, and the government departments have already agreed to work on them.