Minister of highways and public works Richard Mostyn talks to media at the legislature in Whitehorse on Mar. 6. (Crystal Schick/Yukon News)

Opposition questions Yukon government’s choice on free trade contract exceptions

YP accuses the government of giving local companies a leg up on contracts they would have gotten anyway

The minister of highways and public works is defending the government’s choices for contracts it picked for exceptions under Canada’s free trade agreements.

Thanks to a deal negotiated last year, the Yukon government can pick 10 contracts each year worth $1 million or less and limit them only to Yukon companies.

The territorial Liberals are the first government in Canada to take advantage of that option but some of the contracts they’ve picked — including ones for cleaning services and roof work — have a history of frequently going to local companies without any special help.

That had Yukon Party interim leader Stacey Hassard accusing the government of wasting time instead of “identifying contracts that were truly at risk of going south.”

Two of the 10 contracts picked for an exception are for cleaning services. One is for the Whitehorse air terminal and the other is listed as “Whitehorse buildings,” according to a government statement.

“I have looked through the last five cleaning service contracts awarded by Government of Yukon to see how often local companies compete or lose bids to southern companies,” Hassard said in the legislative assembly March 5.

“It looks like, of the last five contracts, there were 18 bids and every single one of those bids was by local companies. So it goes without saying that every single one of those contracts went to a local company.”

Two of the contracts are for roof replacements at the Carcross Community School and the workers’ compensation building in Whitehorse.

The News was able to view 12 old tenders for either partial or complete roof replacements that closed between 2011 and 2017. Those do not include tenders issued by Yukon Housing. All 12 ended up going to companies that list either Whitehorse or Yukon as their location.

The other exceptions include tenders for slope and drainage improvements on the Robert Campbell Highway, work at the Fraser camp, two generators, a boiler replacement and upgrading the ventilation of the maintenance garage at the Whitehorse airport.

The government says the projects are worth a total of $4.4 million and will benefit five Yukon communities.

In an interview prior to question period March 5, Mostyn insisted that without an exception, there are no guarantees that contracts will go to local companies, despite what history suggests.

“You never know. The economies of B.C. and Alberta and the Northwest Territories are continually changing. You have no idea what players are out there. You throw a contract open, you have no idea who’s going to bid on it.”

Mostyn said that because the government wanted to use these exceptions before the end of the fiscal year, it was “limited” in the number of contracts that were available to use.

The government will be able to use 10 more exceptions this fiscal year that starts in April.

“Going forward we’ll have the entire spectrum of contracts we’re going to be able to look at. This last year was a first attempt and we’re the first jurisdiction in the country to use this,” Mostyn said.

All 10 of the contracts with the exception that have been announced are invitational, meaning a company has to be invited by the government to apply. In these cases qualified companies can also request an invitation.

Normally invitational tenders are limited only to contracts worth less than $75,000.

The 10 contracts the Liberals have picked for the exception range in value from approximately $350,000 to $650,000, according to a government statement.

Mostyn said the rules do include provisions for contracts worth more than $75,000 to also be made invitational.

Catherine Harwood, the department’s project lead for procurement improvement, said the government didn’t want Outside companies to see the tenders and “waste their time bidding on things that they’re not eligible for.”

Harwood said the department would be not be releasing a list of which companies it had invited to bid.

She said releasing that list is not considered best practice in jurisdictions across the country.

“We’re protecting the integrity of the procurement process by having the bidder compete not knowing who they’re competing against,” she said.

It’s still not clear if the government will release a list of companies that do eventually decide to place a bid. That’s common with public tenders on the tender management system, but not invitational ones.

Mostyn said he would look into whether that was possible.

Companies that are awarded the contracts will eventually be listed in the contract registry.

Contact Ashley Joannou at ashleyj@yukon-news.com

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