May 21, 1998
(Works, Services and Transportation)

Minister introduces changes to Public Tender Act

Works, Services and Transportation Minister Lloyd Matthews will today introduce amendments to the Public Tender Act in the House of Assembly. "These amendments reflect the views and concerns of various stakeholders representing both the private and public sectors," said Mr. Matthews. "Changes to the Public Tender Act follow a comprehensive review process undertaken by government earlier this year. In carrying out the consultations, government sought ways to strengthen the existing legislation while providing local companies with a fair opportunity to bid on government contracts."

Newfoundland and Labrador is the only province in Canada to have a comprehensive Public Tender Act. "We are proud of this legislation and we are committed to preserving the integrity of the Act," said Mr. Matthews.

The Act was last reviewed in 1990/91. Since that time, there have been a number of changes in the business environment. The review of the Public Tender Act was intended to reflect the changing nature of business while maintaining the spirit and intent of the legislation. "The amendments that I will be introducing in the House of Assembly today reflect the value that we as a government place on the principles of fairness and competition, inherent in the Public Tender Act."

"We are taking immediate steps to foster a more competitive and fair environment for local manufacturers," said the minister.

A registry of locally manufactured products will be compiled in conjunction with the Department of Industry Trade and Technology and the Alliance of Manufacturers and Exporters. This registry, which will include a comprehensive listing and description of locally produced products, will serve as a reference point in calling tenders wherever possible. Local suppliers will now have greater opportunity to bid on contracts called directly by government and agencies of government, and also by contractors for government. Government will ensure that all government funded bodies and general contractors comply with this provision through a system of monitoring and regular compliance reporting.

"This change is intended to give our local manufacturers the opportunity to bid, not to introduce protective measures for local businesses. We have quality products manufactured in Newfoundland and Labrador, however, some local businesses have been hampered by the way in which the tendering process has evolved. Today's announcement places all of our local producers on a level playing field," said Minister Matthews.

In order to maintain transparency and objectivity in awarding government contracts, low price will continue to be the overriding factor in awarding contracts. "Opening up the evaluation criteria to other factors which can not be measured or quantified caused some concerns amongst various organizations bidding on government contracts," said the minister. "We feel that in order to keep the tendering process as open and objective as possible, we must maintain low price as the primary consideration in awarding contracts."

Under some special circumstances, government may acquire goods and services in a manner other than the standard public tendering process. For example, there are some instances in which government seeks services which are complex and where a more extensive evaluation process may be required. In these instances, government is introducing amendments to allow for Requests for Proposals, which are not permitted under existing legislation. In such instances, the private sector may be able to design a solution which is more innovative and which results in a better value for the public.

In other circumstances, the Minister of Industry, Trade and Technology may make exemptions to the tendering process for economic development purposes. This is consistent with provisions in use by other provinces.

"The large majority of goods, services and construction will continue to be tendered in the traditional manner," said the minister. "However we must also make some provisions to deal with the unique situations that arise from time to time."

In other proposed amendments to the Public Tender Act, the thresholds will be modestly increased. "The increase is largely an inflationary one which allows government funded bodies to exercise greater flexibility and achieve administrative savings while still affording the private sector the opportunity to bid," said Mr. Matthews. "We are also introducing amendments which will open the door to electronic tendering by removing the requirement that all tenders must be advertised in a generally circulated newspaper. This change is the result of growth in the information technology fields as well as the preference by some municipalities to use local advertising."

The minister concluded, "The consultation process on the Public Tender Act proved to be a valuable exercise for government and for all the groups and organizations involved. I want to thank all of the people who expressed an interest in the review process. Prior to introducing these changes in the House of Assembly today, I made a commitment to meet with some of the key stakeholders to share the general directions we would be taking and that commitment was fulfilled late last week. I'd like to thank all stakeholders for their cooperation. More than 100 people attended the consultation sessions held throughout the province and the department received more than 40 written submissions.

Contact: Jill Sooley, (709) 729-3015

1998 05 21 12:15 p.m.