Thank you, Mr. Guy. Mr. Moses.

No further questions. Mr. Guy clarified that and I’m glad that the department is actually looking into something like that that might prevent us from continuing with these change orders and possible supp appropriations. Thanks for the clarification and the answers.

Thank you, Mr. Moses. Next on my list is Mr. Bromley.

Thank you, Madam Chair. I had questions, too, on contracting and procurement. Certainly, there is a very high rate of sole-sourced contracting. I believe it’s close to 25 percent; almost 50 percent when we throw in negotiated contracts.

The last time we looked at these processes, I discovered some shabby processes. For example, two contracts with identical work were issued to two different providers with, again, identical reasons, that reason being there’s only one contractor to provide the work. Obviously, that’s not satisfactory and I think there’s been some work done since then.

There are other concerns about, for example, should there ever be an inappropriate relationship with some suppliers which might give an unfair advantage to those suppliers. The management being contracted out to someone who then ignores the Minister’s direction and doesn’t give fair weight to local providers.

Another practice that the Minister mentioned was changing policy or deciding to implement policy without prior notice to suppliers. And finally, overly specific requirements in contracts right down to the brand name, often based on some individual in a department, when, obviously, an equivalent would do the job, and does in many cases. These are just issues.

I believe the Minister indicated the comptroller is doing a review. I hadn’t been aware of that. I appreciate that information. Do we know what the terms of reference is for this review? Maybe I shouldn’t be asking this Minister that question, but I’d be interested if there are terms of reference for that review, if he knows, and when that review is due. Thank you.

Thank you, Mr. Bromley. Minister Abernethy.

Right now contracts are administered by not just Public Works and Services, they’re administered by every department to some degree. Within Public Works and Services, the contracts awarded in ’12-13, by way of summary, to date, the Public Works and Services has only done 59 sole-source contracts, which is about 2.2 percent of all the contracts; 82.2 have gone out for request of proposal, and in 2013-13 none have been negotiated and we’ve got 199, or 14.3 percent, tendered. So very, very few within Public Works and Services are actually sole-source.

There are criteria for sole-source contracts. The goods and services or construction that are urgently required, and delay would cause injury or be against the public interest, only one party is available or capable of performing the contract, the

contract is a consulting service, the contract will not exceed $25,000 in value or is another type of contract that will not exceed $5,000 in value.

I think what the Member is talking about, and the Member can correct me if I’m wrong, I mean, clearly there isn’t total consistency across the Government of the Northwest Territories, which is just another reason why the shared procurement model is valuable and that we need to continue to do the work on the shared procurement.

With respect to the review, the comptroller general is working with the Procurement Procedures Committee to look at these challenges that are coming out of the woodwork, and talk to vendors, talk to the individuals that we’re attempting to contract with, regardless of the method that we’re contracting, to figure out what’s working well and what’s not working well. I have had a number of examples brought to me by Members over the last year and we are sharing those with the comptroller general and the Procurement Procedures Working Group, and we hope to see some improvements on how some of these things are administered.

It’s interesting. As I indicated in my opening comments under standing offer agreements, in some areas we’re finding they’re working really, really well. In other areas we’re having challenges. It’s important for us to identify why we’re challenged in some areas and why we’re working well in other areas. That’s the type of work that’s being done right now in anticipation of moving forward with shared procurement.

I certainly can confirm that I have constituents who have had a number of issues. I’ve brought them forward and I, generally, am satisfied that they are being taken seriously and efforts are being taken to address them with possibly the exception of the overly specific requirements, which I still have not reached satisfaction yet. I guess we don’t know when the comptroller’s review is going to be done, and maybe I’ll save that for Finance.

In terms of the Green Procurement Policy, if I can make a little leap and then I’ll try and bring these two together. Trust me. I mean, I’m looking for the pudding, obviously, right? I’ve asked this a lot of times. When does the Minister think this is going to come forward, the Green Procurement Policy? He sounded pretty positive and actually could see some of the things I’m talking about in terms of potential. Is work actually happening yet on the ground?

Work is happening. I don’t believe it’s gone as far as the Member would like it to go. I would like to see it further along, as well, but given that we’re moving forward with shared procurement, we’ve had to make sure that everything’s going to line up and we need to get the shared procurement down and in place before we change too many other things.

The greening policies, the green procurement I think is important. I think the Member has made a significant number of comments about it and the value of it, so we will move forward on it. I will commit to having something for the Member to look at in the ’13-14 fiscal year, probably closer to the end than the beginning.

I’ll help the Minister remember that. I guess my last one is with general procurement policies and practices. We have the opportunity to have a green element. In fact, we are bringing that lens to our own work now and enjoying, as the Minister reported today in his opening remarks, some significant savings.

Will this Minister work to get the environmental aspect into our general procurement practices so that when we’re asking for something to be done, an important element in the RFP is the environmental practices. An efficient product, how will greenhouse gases be handled in terms of mitigation or offsets, and so on?

I think, as a government, we’re already doing much of that. If you look at the buildings we’re building, we’re building them to meet or exceed some of the national building codes. We’re utilizing technology that is available to us to help us control costs and leave less of a footprint. But I hear what the Member’s saying and as we move forward with the Green Procurement Policy, I will make sure that his comments are considered and utilized where possible.

Thank you, Minister. Next on my list, Mr. Hawkins.

Thank you, Madam Chair. There’s just a question about the Inuvik school and the removal of the old Inuvik schools. I’m just wondering on some detail on that. One of the complaints I’ve received recently was the fact that a southern contractor was used. Could I ask, maybe more so on process, as to what the department does to write our contracts to ensure that southern contractors don’t seem to have the edge or seem to just, by default, get these things. I’m noticing a bit of a trend here.

Thank you, Mr. Hawkins. Minister Abernethy.

Thank you, Madam Chair. Obviously, we’d like the work, as much as possible, to stay in the North, but the NWT is a signatory to the Agreement on Internal Trade, which is a national binding agreement. A key component of the AIT is non-discrimination which establishes equal treatment for all Canadian persons, goods, services and investments. Further, with respect to the GNWT Procurement Policy, demands that the GNWT, in its commercial dealings, observe the highest standards. It must

stand the test of public scrutiny in matters of prudence and probity, facilitate access, enhance supplies access to contracts, encourage competition and reflect fairness in spending of public money, and we must comply with the government’s obligations under AIT.

We do have the Business Incentive Policy that provides an incentive to NWT-based businesses that recognizes the higher costs of operating and doing work in the Northwest Territories, and the BIP must comply with intergovernmental agreements such as the AIT, to which the GNWT must adhere, as I’ve already indicated.

In this particular contract, we had the assessment done on the work that was required. We went out for tender and we had a number of submissions submitted. We had five, in total, submitted. We assessed each of them based on the criteria that was outlined in the tender. BIP was applied and adjusted, and the winning bid was for $1.25 million, which was in budget. That company identified under BIP that 55 percent of the work was going to be done by locals, 3.2 percent was going to be done by NWT, and 41.7 percent was going to be done by southern. In total, over $500,000 is scheduled to stay in the North based on the contract provided.

How do you validate those types of things when they create those formulas? Do you do a follow-up or an audit throughout the process to ensure that they’re complying with their BIP document? I mean, quite often we hear that someone lowballs a bid but then they turn around and, you know, right after they get the bid and they sign their contract for that particular project, they then submit a claim for an adjustment. How do we make sure that they’re delivering on what they promise?

The other question at the same time, I guess, is what does Public Works do specifically to try to foster an opportunity that really looks like or draws out a northern partnership to ensure that we do get people on a better footing? You may not be able to write the contract to say you can only be a Northerner to bid on this, but in the same token, it can be written in a manner that means they have to use hotels, local labour, a lot of local things that are open for anyone in a fair, open market bidding process can comply to.

That’s what BIP does. Under this particular process, we have to apply BIP, where appropriate, and the contractors or potential contractors, when they’re submitting their bids, must identify the local vendors that they’re going to use in all situations. If they are going to be using local hotels, they have to identify the companies they are using, that they qualify under BIP.

As far as monitoring, we require regular reports from the vendors, the successful proponents on

compliance with the contract that we sign with them, which makes specific reference to the individuals they would have identified in their tenders which gave them the BIP adjustment.

Madam Chair, I have a different view on BIP on how it’s used in that regard. But that said, how do you ensure that the compliance of those types of commitments are when they’re not BIP? What you’re saying is that BIP is the almighty tool, but it isn’t because if a southern contractor said that they would use some northern labour force, how are we ensuring that they’re tackling and using that type of force and how do we make sure that they comply as well? It’s easy to say, well, I think you mentioned 55 percent local, I think, labour. I couldn’t write as fast as you were talking. The point of the matter is, this company that’s doing the work there isn’t local, so how do we know that they’re complying with these so-called local initiatives that their bid originally comprised of? Thank you.

In proposals, the company that submits a proposal indicates the companies that they intend to work with, the work that they plan to have those individual companies doing. We have contracting staff and Public Works and Services staff – sorry; this was a tender – in the community who is reviewing their compliance with the contract that was signed. The contract makes specific reference to the individual local companies and NWT companies that they will be utilizing for services.

By way of example, on this particular project, 50 workers in Inuvik were enrolled in the training course arranged by the successful contractor. On the first day of work, 30 were present to start work on that facility. Twenty-five, from what I understand, are still working on that project. They made a commitment to use local resources. They identified the local resources that they intend to use. We monitor, on a regular basis, their compliance with the contract that they have signed with us to make sure that they are in compliance. That would be true whether BIP applied or not in this particular case.

If we sign a contract with an individual for a project, we monitor those projects to make sure that the individual company or provider is staying true to the contract that they signed.

What type of public reporting do you do when you monitor the compliance of the commitments that some of these contractors make? Thank you.

Madam Chair, can I get the Member to repeat his question? Is it specific to this project or is it overall? I’m not sure I understood completely.

I guess, in this case, what I’m getting at is, you say monitor these types of things. Where is that reported and where is it publicly reported? Thank you.

Madam Chair, we do general contract reports. It is not always a public document, but I’m happy to share the information on individual projects with committee, at the appropriate time, on a requested basis.

Thank you. How do you monitor deficiencies sort of in the same stroke? When you do all of these types of reviews and you monitor these contracts in the context of compliance and follow through, do you do any particular follow-up, in a public reporting sense, as to how contracts have been fulfilled, whether they’ve been fulfilled properly, whether we had a fight with them, whether they complied? What I’m getting at is, is there any type of public disclosure that the public would be able to say, when they did this project, they wanted, we will call it fair and square, they did this project but the public doesn’t know of how many problems were done, were they a good contractor, did they fulfill, or did they walk away from the project, so those types of things. Is there any reporting, and if there isn’t, has there ever been any consideration of reporting that publicly? Thank you.