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Political meddling in military buys
Lisa Wichmann
The issue of sole sourcing is under debate again, with Auditor-General Sheila Fraser taking aim at Ottawa for its handling of military contracts.
Billions of dollars have been doled out recently for military aircraft, through a process called an ACAN (advance contract award notice).
What exactly is an ACAN? Michael Fortier, minister of Public Works and Government Services Canada (PWGSC), referred to it as a request for proposals “with a twist” and said it’s not a sole-source contract.
But Fraser disagrees. “We have taken the position that ACANs are not competitive,” she told the defence committee in the House of Commons last month.
Sole-source contracts are nothing new in public procurement. From subway cars in Toronto to military cargo planes, public buyers sometimes opt to skip the competitive process if they know only one company can satisfy the requirements.
And really, given the pressure to speed up federal procurement—especially for the military, where lives depend on reliable equipment—sole sourcing is not necessarily unethical.
In the case of the Chinook helicopters, negotiated recently with Boeing, the government stated that only Boeing could meet its needs. Other companies were allowed to press their cases, but none qualified.
On the one hand, billions of tax dollars are being disposed of without the pressure of competition to ensure prices are reasonable. Why should Boeing care what it bids for the contract, if the government has already said Boeing is the only game in town? Talk about a seller’s market!
So yes, the issue of the shifty ACAN must be dealt with, and competitor companies given a fair shot at the business. But in the meantime, we’re losing sight of a more insidious practice in military procurement—political pandering.
In August of last year, the Conservative government invoked a “national security” clause, allowing it to take control of $8 billion in military spending, and dole it out to specific regions of the country.
Stephen Harper is falling all over himself to make Quebec happy this year, in advance of a possible election. He recognized the province as a nation; and later entertained the idea of increasing Quebec’s transfer payments.
Sure enough, the Boeing deal is mired down by political caterwauling, with Quebec insisting on a larger share of the contract benefits.
Michael Fortier, the Minister of PWGSC, is from Montreal. When these ACANs are signed, does Fortier wonder how to get the best value for all Canadians? To ensure the equipment commissioned is delivered as quickly as possible? Or does he hold out until he’s satisfied Quebec’s plate is full enough, regardless of how the lobbying further delays the deal.
By all means, the government should be able to sign a sole-source contract if independent watchdogs agree there are no valid competing offers (and ensure the price is fair).
But it should stop short of asking Canadian taxpayers to help it buy votes.
—Lisa Wichmann
Editor
Contact the editor at lisa.wichmann@pb2b.rogers.com
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