BCTS Contracting Audit Findings: Summary & Recommendations

1. BCTS Contracting Practices Summary of Audit Findings April 2007

2. BCTS Contracting Practices • 7 Business Areas audited to date: • Seaward tlasta • Babine • Cariboo Chilcotin • Stuart Nechako • Prince George • Okanagan Columbia • Skeena • 4 more planned for 07/08

3. BCTS Contracting Practices • Numerous examples of fine contract management have been observed. • Significant improvement in many of the contracting practices identified as deficient in previous audits and reviews

4. Good Practices • Overall contract documentation • Advertising and award practices • Number of direct awards. • Invoice payment processes • Use of check lists and data sheets • Use of equipment hire • Management oversight of planning

5. Areas for Improvement • Co-ordination of planning and activities • Management Oversight / Risk Management • Training • DAs & Equipment Hire • RFPs – OTR & Multiyear contracts

6. Co-ordination of planning and activities • A lack of co-ordination of contracting activities within Business Area between field-teams is creating inefficient and less than effective contracting practices.

7. Co-ordination of planning and activities • Increased risk of unfair, or perceived unfair, contracting practices • Not consistent with the BCTS business model • Not client service focused • Has resulted in contractor complaints

8. Co-ordination of planning and activities • Contracting risks will be reduced and the effectiveness of contracting practices increased by ensuring that Business Areas function as a single business unit

9. Management Oversight / Risk Management • Increased involvement and oversight by the TSM and BALT is required • Mgmt oversight in planning and monitoring to ensure appropriate accountability and level of risk. • Introduction of regular periodic management reporting

10. Management Oversight / Risk Management • Ensure sound principles of risk management underscore contract decisions. • Too frequently high-risk contracting decisions are being made by Contract Coordinators.

11. Management Oversight / Risk Management • The number, type, award method and value of contracts by contractor should be reviewed. • To ensure the achievement of the fundamental contracting objective for fair access to government business. • More holistic long-term planning within Business Areas to help ensure both contract and business risks are adequately addressed

12. Management Oversight / Risk Management • The Business Officers not used effectively or as is intended. • Should assume a greater leadership role. • Ensure that effective contracting accountability and performance management frameworks are in place. • Provide assurance that contracting practices are effective and in compliance with ministry contracting policies.

13. Training More training is required. • A lack of understanding of risk, contracting principles, law, and policies has led to inappropriate policy interpretation or avoidance resulting in: • Inappropriate practices and award decisions. • Lack of fair access to work. • The acceptance of individual and Business Area risks well above reasonable levels.

14. DAs & Equipment Hire • Number of direct awards and use of equipment hire still an issue in some locations. • Other locations have significantly reduced the number of directly awarded contracts and equipment hire agreements.

15. RFPs – OTR & MY Contracts • Inappropriate use of RFPs and OTR & MYC increase risk of not providing fair access to work. • RFPs for silviculture contracts not consistent with policy. • OTR & MYC changes to tender and contract terms not always consistent with policy.

16. RFPs – OTR & MY Contracts • Fail to achieve objective for defensible and justifiable contract awards. • Have resulted in several complaints of unfair award practices. • Significant legal exposure.

17. RFPs – OTR & MY Contracts • Contracting risks will be reduced by ceasing to use Requests for Proposals and increasing the use of Invitations to Tender to procure silviculture services.

18. Sharing Lessons & Best Practices • Final Reports and Action Plans all on BCTS HQ Corporate Operations web site.

19. BCTS Contracting Practices • Questions? • Comments?