Pallister breaks construction promises


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Promises made, promises kept?

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Hey there, time traveller!
This article was published 16/03/2018 (1663 days ago), so information in it may no longer be current.

Promises made, promises kept?

Manitoba’s Progressive Conservatives came to power in 2016 promising financial prudence, transparency and accountability.

The heavy-construction industry was hopeful — Manitoba had to get beyond past policies on public infrastructure contracts that distorted the market and unnecessarily increased costs to the taxpayer. The province direly needed a transportation investment strategy that transcends annual budgets and political cycles.

Winnipeg Free Press Files A machine called a Rubbleizer, which crushes old roads, works on Portage Avenue in Headingley.

We heard promising pledges from the Progressive Conservatives.

First, they committed to invest a minimum of $1 billion annually in core infrastructure: sewer, water, highways, land drainage and bridges. And we were told their government would not underspend the highways budgets, as happened in years past. A budget made was a budget to be kept.

These are key commitments in a province battling a $6-billion highways infrastructure deficit that weighs against Manitoba’s trade potential. Highways are the arteries to keep trade — the heart of our economy — moving.

Secondly, the Conservatives pledged to be “smart shoppers” — in the Manitoba way — and end what leader Brian Pallister called “an epidemic” of sole-sourced contracting of government work.

So, how has the government fared in keeping its word?

Budget 2018, called “Keeping Our Promises,” left the pledges on the cutting-room floor.

The promised $1-billion infrastructure investment has dissolved in a redefinition of that term. “Core” has become “strategic” infrastructure and includes health, education and housing. This year, total investment in core infrastructure is budgeted at $624 million (including equipment, aircraft and airport runways).

In particular, Manitoba’s highways capital program, critical to our highways and trade corridors, has taken systematic blows.

Our industry knew the 2015/16 highways budget of $629 million was unsustainable. And we recognized that we, too, had to be part of beating back annual deficits. We accepted this government’s public assurances, after drops to $540 million (2016-17) and then $502 million (2017-18), that $500 million annually was a rock-bottom certainty.

On March 8, we were again assured this budget line would hold to $500 million, and reassured what was budgeted would be expended.

On March 12, however, the facts spoke otherwise. Highways capital was slashed to $350 million — more than $150 million less than 2017-18’s budget, and a 35 per cent cut in two budgets. Further, the Third Quarter Financial Report forecasts the highways capital expenditure for 2017-18 will be only $436 million, not the $502 million budgeted. So much for “budget made, budget spent.”

This is severe for our industry, which supports the direct and indirect jobs of 15,000 Manitobans. Wages account for 30 per cent of project costs, so a $150-million slash in one budget cycle will see $50 million in lost wages to our workers. Full-time employees, and students looking for work this summer, will see fewer hours. The responsibility lands firmly at the doorstep of the government.

The betrayal, however, doesn’t stop there.

Perhaps the greatest insult to our industry is the decision to sole-source contracts, a practice this premier vowed to end.

In public procurement, except for emergencies, it is always best to openly tender work on the market. The competitive market submitting competitive bids will return the best price to government tenders for any construction project.

Yet, last week Manitobans learned two contracts were sole-sourced for initial road work for the Lake Manitoba-Lake St. Martin outlet-channel project. The total outlet project is worth an estimated $540 million; a total of $30-35 million in access road work is proposed to be sole-sourced. (Provincial procurement rules allow for sole-sourced contracts in emergencies — this is not an emergency.)

Infrastructure Minister Ron Schuler explained sole-sourcing ensured First Nations affected by 2011 flooding will see substantial benefit; the contracts have a 50 per cent Indigenous content requirement.

But a requirement for Indigenous engagement has been included in past tender documents and could have been part of an open, competitive bidding process for this work. We offered a number of suggestions, each of which was ignored.

Schuler has said his department got very good value on the untendered contracts. Only a free, unfettered and competitive tendering process, however, could assure it got the best price.

We believed this government would respect pledges that would have put Manitoba on the road to a sustainable infrastructure investment strategy. We are profoundly disappointed with broken promises.

Chris Lorenc is president of the Manitoba Heavy Construction Association.

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