Letter to The Editor:
Dear Stephen Bauld, there’s a lot at stake for Toronto’s taxpayers in that city’s upcoming decision on whether to accept open tendering.
That’s why the need for clarity on this issue is absolutely critical.
You recently lashed out at Cardus over research we’ve published over the years. Some of that research we did with you. In fact, about five years ago, you and I co-authored a paper, Hiding in Plain Sight, in which we learned a lot about the closed tendering that has come to characterize Toronto construction projects.
Here are some of our conclusions:
- “Closed tendering for public procurement acts contrary to the public interest.”
- “Membership in a particular trade union does not provide an objective criterion for the purposes of public procurement.”
- “There is a preponderance of evidence and almost universal agreement that restricting competition raises prices.”
- “A closed tendering environment with restricted competition, on the other hand, will be particularly vulnerable to forms of anti-competitive and market distorting activities.”
- “A party conducting a tender process is well advised to structure it in a way that attracts the maximum number of bidders.”
These statements are very much in line with a paper you wrote for the Residential and Civil Construction Alliance of Ontario (Towards a Fair and Balanced Approach: A Commentary on Government Procurement in the GTHA) and your own handbook on municipal procurement.
Have you since publicly renounced that research and those views?
You also appeared in a Cardus video to provide the best argument for open tendering.
“By reducing competition, the price escalates tremendously,” you said in 2014.
“In some of those cases you’re only getting one or two bidders, as opposed to if you were doing it in a more open fashion you would be getting maybe seven or eight bids of qualified contractors.”
Our research from Waterloo, Ont. showed that that is exactly what happens in a closed situation like Toronto’s. The bidding pool went from eight to just over three bids per project.
In the 2014 video, you ask, “What is the point of closed tendering? What is the point of not getting value for money?”
Stephen, not long ago you were asking good questions in the pursuit of fairness. I’d welcome you back to that pursuit any day.
Brian Dijkema,
Work & Economics Program Director at think tank Cardus
Brian Dijkema is to be commended for seeking to dispel his confusion on the matter of “open tendering”. I must assume that Cardus’ confusion stems from starting with the conclusion and adjusting discrete facts accordingly.
There are many factors that contribute to cost, competition and productivity in public procurement none of which Cardus is willing to acknowledge. In the 2014 video cited by Brian Dijkema, Stephen Bauld stated that the issue is clearly not one of union vs. non-union. Cardus has arbitrarily re-defined “Open Tendering” from the original definition as “….a bidding process that is open to all qualified bidders and where the sealed bids are opened in public for scrutiny and are chosen on the basis of price and quality” to a bidding and selection process that excludes historical contractual obligations as a means to reduce cost and increase competition and productivity.
Membership in a particular trade union, unto itself, may not provide an objective criterion for the purposes of public procurement but Cardus fails to acknowledge that construction owners prefer to qualify contractors by their occupational health & safety record, their commitment to apprenticeship, trades and skills training, and their success in local community benefits, along with the direct contributions to the pension and welfare of many Ontarians, all of which are factors that form a basis for the objective criterion for the purposes of public procurement. Furthermore, Cardus continues to disregard the success of construction trade unions to improve competition and productivity for the purpose of improved delivery of construction projects.
Cardus has falsely promised an improved procurement and delivery process based on the elimination of a single element of a very complex process to which I respond that Cardus is simply not credible.