Perhaps the biggest two takeaways from the Yukon government’s new procurement policy are welcoming First Nations into the fold of the process and defining what makes a business.
To be considered a business currently, two stipulations, like employing Yukoners or owning property in the territory, must be met.
The updated policy says that businesses are expected to hit three of the following: be subject to territorial income tax, registered under the Business Corporations Act or the Partnership and Business Name Act, have a physical Yukon address and “a valid municipal business license, where applicable.”
On Feb. 20, business and government experts were included in a panel discussion concerning the new policy. Terry Sherman, president of the Yukon Contractors’ Association, was part of it.
The revamped business definition, he said, ensures companies are more cemented in the territory, calling it a “major plus.”
“If you’re a company, you’re paying your tax in the Yukon,” Sherman said. “Those tax dollars staying within our economy is a plus.”
Sherman said there’s a trickle-down effect at work, in that local economies will be bolstered, as well.
The new policy doesn’t include hiring Yukoners like the current iteration does.
Sherman doesn’t have a problem with this, calling it a limitation otherwise.
“If we had to rely on only Yukoners working in certain projects, we would have some issues,” he said, noting the relatively small population of the territory.
He added that ideally people would become permanent residents of the Yukon.
“We want to build our community, we want to grow our economy,” he said, “but we need people to do that.”
Yukon Party interim leader Stacey Hassard said the Liberal government has “lowered the bar” when it comes to the revised business definition.
“It appears to be, under this new definition, that you can essentially be a shell company. You don’t have to own land for an office or even employ a Yukoner,” he said, adding that it makes it easier for southern companies to get a “foothold” in the territory.
More broadly, Hassard continues, the Liberals have broken their campaign promise of completing the procurement policy by 2018.
Hassard called it “rather bizarre” that copies of the updated policy weren’t provided to the media at the press conference last week.
“I don’t think that was fair to the media folks that were there.”
Earlier this week, the Yukon governments announced 10 projects that have received trade exemptions worth $1 million each this year.
Speaking with reporters on Feb. 19, Richard Mostyn, the minister of highways and public works, said the money awarded is much greater than last year.
The total value is worth roughly $7.5 million; this number was about $4 million last year, according to a departmental press release.
Asked about the discrepancy, Mostyn said, “It’s because we had the full spectrum of contracts to choose from as opposed to last year — it was the tail end.”
Projects include the portable for Golden Horn Elementary School and bridge construction near Dawson City.
The First Nations policy will take effect later than April 1, Mostyn has said.
Subscribing First Nations are to be notified “of all publicly advertised procurements,” the policy says.
The Yukon government “will conduct procurements by taking measures to ensure Indigenous peoples benefit from the provisions of trade agreements and support First Nation businesses and individuals to grow, enrich their lives and become partner in the economy,” it says.
The sooner that this policy is fully implemented the better, said Catherine Harwood, assistant deputy minister with the department, who was part of the panel discussion.
“We need it, want it to be collaborative with the First Nations, so it’s not a Yukon government timeline, it’s a timeline for the entire working group.”
Asked how the policy could work, Harwood said she wasn’t at liberty — yet — to speak to specifics, but noted that the goal is to build a mutually beneficial relationship, in which capacity could be developed in First Nations and the government “fulfills its promises.”
“We’re addressing that right now with the technical working group,” she said. “What do we want to put in it and what would that actually say, what that language would be.”
Hassard said it was promised the First Nations component would be rolled out at the same time as the entire policy.
“This wasn’t going to be a piecemeal project, but yet, in fact, that’s exactly what it is,” he said. “The Liberals, clearly, had no idea what they were talking about when they made these promises.
“They’ve released this policy that isn’t finished. We know the rules are going to change, we just don’t know how,” Hassard added.
Other elements in the new policy include increasing procurement thresholds. For open tenders this means up to $101,100 for construction and services; over about $25,000 for goods; and up to $101,100 for invitational tenders, according to a summary of the changes.
Bonding is also to be made more consistent. Projects with a greater value than $1 million, for instance, will require bonding “as part of the terms of the contract,” says a summary of the policy.
Contact Julien Gignac at email@example.com