Staying on track

From the October 2021 print edition

Recent procurement audits have put the spotlight on the need for improved planning and training to support government operations and avoid cost overruns and delays.

Cost overruns and delays are two risk areas identified in recent audits. For example, in its December 2020 audit entitled Value-for-Money Audit: Metrolinx Operations and Governance, Ontario’s Auditor General found that Metrolinx, a provincial mass transportation agency, expanded its Presto fare card program by awarding a series of sole-source contract extensions to the incumbent, which added $1.7 billion in untendered work to the original $232 million contract. The audit underscored the importance of better planning for full lifecycle requirements when scoping and awarding long-term contracts.

Similarly, in its 2021 report entitled Report 2: National Shipbuilding Strategy, Canada’s Auditor General raised new concerns over ongoing production delays in the federal government’s multi-billion-dollar shipbuilding program. The Auditor General warned that “further delays could result in several vessels being retired before new vessels are operational.” The report concluded that “interim capabilities are limited and cannot be extended indefinitely.” This audit provided another example of how protracted procurement delays can undermine government operations.

In fact, procurement delays are often caused by systemically weak planning. For example, in its 2020 report entitled Securing Personal Protective Equipment and Medical Devices, the Auditor General
of Canada found that Canada’s federal government was forced to play catch-up in securing personal
protective equipment due to the long-standing and well-known deficiencies in its emergency stockpiling program. The Auditor General noted that the government “did not have a process to establish how much of an inventory of this equipment should be stockpiled to help meet provincial and territorial needs during a public health emergency.” The audit also found that these systemic issues were known to the government for at least 10 years prior to the COVID-19 crisis.

The pandemic further revealed long-standing systemic weakness in the planning practices of government institutions at all levels. For example, the Ontario Auditor General’s November 2020 report entitled COVID-19 Preparedness and Management Special Report on Emergency Management in Ontario—Pandemic Response documented long-standing deficiencies in Ontario’s emergency planning portfolio. As the Auditor General detailed, these emergency planning gaps were documented in its prior 2017 report, where it concluded that government did not have agreements in place to secure critical goods and services that could be required in an emergency. That 2017 report made a series of emergency readiness recommendations to address these planning weaknesses. However, many of those recommendations were not acted on. This resulted in price gouging by suppliers during the COVID-19 crisis as public institutions competed against each other for limited supplies.

These failures underscore the need for better training in support of better planning. The Ontario Auditor General’s December 2020 report entitled Business Case Development in the Ontario Public Service identified the need to enhance staff training in connection with the development of business cases for procurement project approvals. The audit found that the government’s central approvals board was “not consistently provided with complete business case information” and noted that 45 per cent of the surveyed staff agreed “that they did not have access to the necessary training and resources to carry out their duties.” The report recommended the government provide training, coaching and mentorship opportunities to staff responsible for preparing business cases in support of government procurement projects.

The federal government’s adoption of agile procurement is a recent example of how public institutions can improve procurement outcomes through advanced training and innovation. In its 2021 report entitled Procuring Complex Information Technology Solutions, Canada’s Auditor General noted that Canada’s federal government adopted agile procurement as a means of modernizing its aging information technology portfolio. As the report stated, “while the traditional procurement process is linear and awards a single large contract, the agile procurement process is iterative and awards multiple smaller ones.” While the audit found that the Canadian government “made good progress toward adopting agile procurement practices for large IT systems,” the Auditor General found that the government rolled out its agile procurement program with insufficient staff training. The report concluded the government needed to better “assess what skills or competency training was needed to support the move to agile procurement.”

As these recent audits illustrate, planning and ensuring project teams are staffed with trained personnel are key for enabling innovation and increasing the success of major procurement projects. Public institutions should prioritize these measures to support government operations and service delivery.

Paul Emanuelli is general counsel of The Procurement Office and can be reached at [email protected]