CCA Report: Standard Practices Tour

via Alberta Construction Association

CCA President Mary Van Buren and Senior Vice President Rod Gilbert, supported by National Advisory Council Chairs and CCA Chair Brendan Nobes, visited VancouverEdmontonWinnipegSt. John’s and Montreal in June to learn first-hand from members about their challenges with current procurement practices and project delivery methods.

Thank you to our LCA partners – Donna Grant (Vancouver), David Johnson (Edmonton), Chris Lorenc (Manitoba), Ron Hambley (Winnipeg), Pierre Hamel (Quebec) and Rhonda Neary (Newfoundland & Labrador) for your support in this engagement initiative!

Objective

The Standard Practices tour was a fact-finding mission on the part of CCA to collect information on the top procurement pain points experienced by members and obtain feedback on where CCA should focus its efforts. The insight gathered will be used to develop tools to help educate owners (public and private) on improving procurement.

About 110 industry members representing the civil, trade, general contractor, and supplier sectors participated in the tour. Roughly 60 to 70 per cent work on public projects (federal, provincial, and municipal governments as owners) and virtually all also have experience working with private owners.

Summary of issues and implications

A familiar theme heard from many members across the country is that the current system is broken – and trust is eroding between the owner and contractor. Examples cited include the RFP\tendering process and its restrictive and inefficient requirements; the lack of knowledge and expertise among bureaucrats representing the owner; that contractors shoulder much of the risk and manage unknown project costs and delays; and that owners favouring the lowest bidder undermines contractors who could provide best value.

“The system is broken.” Public procurement at all levels of government is inefficient and unduly risky for contractors
  • The time from concept to ground-breaking is too long, resulting in contractors having to inflate quotes to mitigate against future price escalation risk (especially in lump sum projects where there is no recourse), including more costly and difficult to obtain insurance/bonding.
  • Documents are only 50-75 per cent complete when they are released for bidding, expanding contractor risk in estimating. Owners often need to re-start process as the budget can be lower than bids received due to time lapse between when the project is conceived and when it is released for bid.
  • Contractors believe it is unfair that if they remove onerous conditions or clauses, they are eliminated from the bidding. One example contractors mentioned is liquidated damages.
  • Security clearances are not coordinated or recognized intra-provincially or even across different federal departments, resulting in repetitive paperwork or losing workers due to the slow approval process.
  • Federal department regional offices could play a stronger role in informing appropriate qualifications for regional projects.
  • A more standardized approach from coast to coast at every level would make the industry more productive.
  • Given the length of time to get feedback on contract bids, some contractors either find themselves with too much business, or not enough, as they do not want to extend themselves, given many bids in progress.
Public owners lack the expertise, insight, or influence to improve the system
  • The federal government outsources to companies like BGIS, reducing their internal capacity and knowledge of the procurement system and evolving bes