Pallister government fails Economics 101

Transparent bidding procedures ensure fair process for taxpayers and companies alike

Graphic by Ernest Zarzuela.

If there was one thing Manitobans should have been assured of following the 2016 provincial election, it is that Brian Pallister was an expert in business. Privatization seemed to be his philosophy in dealing with businesses in government.

Ever since he was leader of the opposition, he had always been clear when it came to how he would spend taxpayer dollars: “We have recommitted to look for the savings within government. We have made that commitment to the people of Manitoba.”

This is why it was flabbergasting when news broke March 7 that the Pallister government awarded construction contracts unfairly without following correct, competitive bidding procedures. The project in question concerns the construction of a road as part of the Lake St. Martin channel project.

When it is not viable for the government to produce a desired result – building infrastructure for a desired cost, say – it will contract the work out to the private sector. An important step in this process includes competition between contractors so taxpayers get the best deal. Occasionally, governments may even negotiate with private industry to lower costs.

This is the case for high-valued contracts in infrastructure. In the construction industry, it is pivotal that our provincial government awards contracts to the lowest bidder – the company which will complete the job for the fewest taxpayer dollars. The marketplace serves to sort out competing firms and present a finalist whose work is both economical and credible.

Pallister’s actions suggests he does not appreciate the importance of this. In prematurely awarding a contract, he has given cause for alienating not only his voters, but every taxpayer in Manitoba.

After constantly accusing the NDP of overspending, driving up the deficit, and over-relying on similar single-sourced contracts, Pallister has stepped into his own trap.

It was just this November when infrastructure minister Ron Schuler assured Manitobans that the Progressive Conservative government was going to “shop smarter” for contracts. Schuler must understand how terrible this recent news reflects on the party as a whole, since he originally announced two firms for the construction contract had been chosen after a competitive bidding process. It was only after the Manitoba Heavy Construction Association pointed out this lie that the minister walked back his statement.

But how about our provincial commander-in-chief? Surely, Pallister would be quick to reject the incompetence of Schuler and his untendered contract, and maybe go on to talk about the importance of free market enterprise determining the fair cost? When asked how he could be sure a non-bidding process could be getting the best price the market could provide, Pallister was quick to throw his infrastructure minister beneath the fast-approaching bus: “If the minister made the mess, he’ll clean it up, not the premier.”

It was just two years ago that the humble opposition leader and MLA Brian Pallister was antagonistic toward such monopolistic contracts, calling them an “epidemic.” He was sure to blast the NDP when Manitoba Hydro awarded Tetra Tech an $85 million contract without a proper bidding process.

But what about that earlier question Pallister deflected by tossing his infrastructure minister in the way? He answered it two years ago, saying “There’s no way to prove if you’re getting value for money from an untendered contract.”

Many would wholeheartedly agree.