Integrity: Vendor’s Role

1. Integrity: Vendor’s Role Christian Laverdure Senior Director Policy, Risk, Integrity and Strategic Management Sector Acquisitions Branch Public Works and Government Services Canada September 14-16, 2011 Santiago, Chile Multilateral Meeting on Government Procurement III

2. Table of Contents • Overview • Background • Internal and External Drivers • The Past • The Present • The Future • Discussion

3. Overview • The Government of Canada • Public Works and Government Services - Acquisitions focus • Are we getting value for money? • Industry is not out to get us • But what are they doing to enhance integrity?

4. Background Examined internal and external drivers that have had an affect on vendor’s integrity – what are the triggers? Stakeholders: Canadian Public, Government, Parliament, Private sector, para-public groups and media Governance: Acts, Regulations, policies, departmental policies, internal manuals and guidelines

5. The Pendulum • The “Tipping Point” in the Canadian context • Compliance (Risk Aversion) versus Flexibility / Efficiency (Risk Mgmt) • Not more regulations but more oversight

6. Balances competing interests for the public good Legislation, Regulations, Policies • Small and Medium Enterprises • Industrial and Regional Benefits • Green • Aboriginal set-aside • Innovation Socio-economic considerations • Fair, open and transparent • Best value to taxpayers Competitiveness Canadian Values

7. The Drivers • Internal: internal audits and findings, irregularities, less money, focus on value for Canadians and value for money • External: over billing, excessive profit, bid rigging, vendor performance

8. The Past • Cost and Price Analysis • Cost Audit • Standard Clauses and Conditions • http://ccua-sacc.tpsgc-pwgsc.gc.ca/pub/acho-eng.jsp

9. The Present • Add to that: • The Federal Accountability Act • http://www.tbs-sct.gc.ca/faa-lfi/index-eng.asp • Vendors’ Code of Conduct • http://www.tpsgc-pwgsc.gc.ca/app-acq/cndt-cndct/conduite-conduct-eng.html • Perception of Bid Rigging issues (administrative reviews) • Increased media attention (and Access to Information) • Increased public awareness (value for money) • Vendor Performance Policy • http://www.tpsgc-pwgsc.gc.ca/app-acq/arp-pns/ap11r2-pn11r2-eng.html • Commissioner of Lobbying of Canada

10. Vendors’ Role • Associations role (peer pressure) • Standards (ISO) • Subcontractors (supply chain) • Whistleblowers

11. The Future • More reliance on internal controls • Stronger use of external audits, verifications, assurance programs • Learning from our mistakes • Let the industry tell us how to self-regulate

12. Discussion • What’s the right balance? • How do we ensure vendor integrity while not driving away the private sector and still expecting the best value?

13. Questions? 13

14. Legislative and Regulatory Framework Modern Treaties • Comprehensive Land Claims Agreements • 23 Comprehensive Land Claims Agreements in effect (20 with contracting obligations) Trade Agreements Act Legislative Authority • World Trade Organization’s Agreement on Government Procurement Implementation Act (January 1, 1996) • North American Free Trade Agreement Implementation Act (January 1, 1994) • Agreement on Internal Trade Implementation Act (July 1, 1995) • Canada-Peru Trade Agreement Act (August 1, 2009) • Canada-Chile (April 5, 1997) • Department of Public Works and Government Services Act (1996) • Establishes powers of the Minister for: • Acquisition of Goods • Acquisition of Services and Construction • Planning and organizing the provision of goods and services for departments Statutes • Defence Production Act (1951) • Provides the Minister “Exclusive authority” to acquire defence supplies/construction/projects • Federal Accountability Act (2006) • Office of the Procurement Ombudsman (2008) • Also introduced the code of conduct for Procurement (2007) • Financial Administration Act (1952) • Government Contracting Regulations