Tuesday, August 15, 2006

Harper dips into the pork barrel on defence deal

VICTORIA - How does it happen? How do we vote for a whole new approach to government and end up with the same old politics?
Like or loathe them, what Stephen Harper and the Conservatives mostly promised was something different. No more political pandering, just good common sense. An end to politicians interfering in the awarding of government contracts, for example. From now on, the goal would be to get the best deal for taxpayers.
But not a year in power and it looks like same old, same old in some troubling ways.
The Conservative government plans some big military spending. Top of the shopping list are 16 Chinook helicopters and four C-17 transport planes from Boeing. The deal will cost you something like $8 billion, including 20 years of support.
The Canadian government wants some of that money to stay here, so the contracts are going to specify that half the total spending has to be in Canada. Boeing will want to keep the manufacturing at home; Canadian firms are most likely to be able to bid for the maintenance contracts.
That should mean companies across Canada would get a chance to compete for the work. The ones that came up with the best proposals to keep the aircraft flying safely at the lowest cost would get the work.
That’s even supposed to be the rule. In 1994 Ottawa and the provinces signed a deal to ensure all Canadian suppliers had equal access to government procurement. Provinces weren’t allowed to overlook the best bid just because it came from outside their boundaries. The federal government agreed it wouldn’t hand out contracts to favoured companies or regions.
But there was an exception. The federal government could over-ride the commitment to open bidding “to protect national security or to maintain international peace and security."
And that’s the clause the government has invoked in the Boeing deals. It has become a matter of national security to protect the government’s right to steer contracts to chosen companies, even if their work costs more or is of inferior quality.
You’d think the Conservatives would have learned, since they’ve been down this road before. Back in 1986 a consortium led by Bristol Aircraft in Winnipeg had submitted the best bid on a contract to maintain the military’s CF-18 jet fighters, according to the Defence Ministry.
But at the last minute the Mulroney government over-ruled the military and handed the deal to another group headed by Canadair of Montreal. The decision was seen as an insult to the West; really it was an insult to taxpayers and the pilots who would fly the planes.
Now the current Conservative government has chosen the same path, invoking the “national security” loophole to let it parcel out the goodies.
Industry Minister Maxime Bernier says it’s not about patronage. But the government is going to set quotas, still to be decided, on where the work has to go. Quebec, the West, Atlantic Canada all have to get a taste - even if that means taxpayers are subsidizing companies by paying higher prices.
The decision embraces the culture of the old Ottawa. Companies that want to get these contracts can’t just concentrate on having the best technology or workforce.
They have to find the best lobbyists, the ones with the tightest ties to senior bureaucrats and politicians. Influence in pushing the quota system and steering work their way matters as much as their competence or ability to deliver value for money.
How can the Conservatives have forgotten so quickly? The Liberals were defeated in part because Canadians were tired of this way of doing business. They wanted the political influence, the lobbying and the efforts to favour one region taken out of spending decisions.
Instead, they got a new government that seems quickly to be sliding into the ways of its predecessors, despite all the talk about a new way of doing business.
Footnote: Why not guarantee all regions get some of the work? It increases costs, opens the door to political patronage and to rewards for friends and doesn’t really accomplish anything in terms of regional development. Propping up uncompetitive businesses with government money is just an expensive way to delay the inevitable. (Think Skeena Cellulose.)

1 comment:

nelsonmuntz said...

Thanks for the concise argument. You made this make sense, as the few other items I read (and I think its another case of harper getting an easy pass thru most of the msm) were very confusing and didn't explain it to the detail you did.
Its amazing that they'd pull out this 'national security' clause when most Canadians would agree that Canada is not facing the same threats as our neighbours (at least not until we stopped having an independent foreign policy)... This is just another example (fortier, making cabinet meetings a hidden event, the softwood lumber deal, lobbyests and health care stock holders in cabinet..) of where this gov't is showing its 'do as i say, not as i do' roots.