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Ethics training for suppliers
For several years now, a relocation contract has dogged Public Works and Government Services Canada. The scandal was in the news again this month, with the Globe and Mail offering a prelude to a report coming out November 28 from the Auditor General.
All indicators say the report will come down heavily on Public Works for mismanaging a $400-million contract for the second time in three years.
The government was forced to cancel the first contract three years ago after it was discovered senior bureaucrats involved in bid evaluations had accepted free golf games, and in one case, a Caribbean cruise from the winning bidder, Royal LePage Relocation Services.
A new evaluation team was brought in, overseen by a fairness monitor. The bids were scrutinized, and once again, Royal LePage won the contract to relocate 15,000 members of the Canadian Forces annually.
But this time, there were technical problems with the bid documents. According to the Globe, Public Works asked bidders to list the price they would charge if 7,200 people rented out their homes, instead of selling them.
The losing bidder, Envoy Relocation Services, pegged these property management fees at $48 million per year. Royal LePage said the services wouldn't cost anything because government policy requires employees who decide to rent their homes to pay the management fees themselves. It led to speculation as to why the question was included in the RFP in the first place.
Envoy also called attention to the government's weighting system, which caused Envoy to lose 24 technical points during the evaluation. Yet Envoy's bid was $423 million, while Royal LePage's was $9 million higher.
Public Works defended itself, saying value for money was an important criterion, not just the lowest cost. Fair enough. But Envoy claims it met 92 per cent of the RFP's criteria, in addition to coming in with the lower cost.
Once again, the usual lessons can be learned. Public servants shouldn’t accept vacations, rounds of golf and gifts from vendors. But let's take a look at Royal LePage, and supplier responsibility in general.
Were the executive at Royal LePage unaware one of their staff was taking a public servant on a Caribbean cruise? And how did the free golf games go unnoticed? Shouldn’t vendors be on the hook for ethics transgressions too?
Even more bewildering is the fact that Royal LePage is seeking damages from the government over the cancellation of the first contract! Only in the public sector could a supplier sue its customer, and expect to continue doing business with them after.
The first contract was scuttled because of direct interference from the vendor. If the golf games and cruises weren't offered, there wouldn't have been a problem in the first place. That doesn't excuse the bureaucrat, but it's time suppliers take their share of the blame for causing bids to go awry.
In the very least, if they aren’t reining in their sales reps and teaching them a thing or two about ethics in bidding, they should at least have the grace not to act outraged—and sue the government—when their own employees ruin the day.
—Lisa Wichmann
Editor
Contact the editor at lisa.wichmann@pb2b.rogers.com
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