CALGARY — The Department of National Defence (DOD) is facing renewed scrutiny after a federal watchdog found a recent contract award raised serious concerns about fairness and potential preferential treatment, echoing earlier warnings about insider dealing in military procurement.According to Blacklock's Reporter, Procurement Ombudsman Alexander Jeglic concluded the department failed to run a fair process in awarding a small construction contract tied to military housing.“The department did not conduct its procurement process in a fair manner,” Jeglic wrote. “It failed to properly assess and address the potential conflict of interest.”The complaint centred on a $79,000 carpentry contract issued last August by the Canadian Forces Housing Agency at Canadian Forces Base (CFB) Trenton. Instead of opening the work to public bids, the contract was offered to five selected suppliers — and ultimately awarded to a serving member of the Canadian Armed Forces (CAF) who was working as a contractor on the side.A competing bidder who finished second challenged the decision, arguing it violated internal conflict-of-interest rules. Jeglic agreed, writing the circumstances “raised questions regarding fairness and apparent perceived preferential treatment.”“A reasonable observer would perceive that awarding the contract to the successful bidder, being an active Canadian Armed Forces member, could give rise to a suggestion of preferential treatment,” he wrote..New defence strategy aims to rebuild Canada’s military industry.Jeglic ordered the department to compensate the unsuccessful bidder $7,650.The ruling pointed to the department’s own Code of Values and Ethics, which requires personnel to avoid not only real conflicts of interest but also situations that create the appearance of one.A separate directive warns contracts awarded to employees or members must not invite any suggestion of favouritism.While the carpenter had prior approval from a superior to take on outside renovation work, Jeglic said that permission did not extend to working on department-funded projects on military property.“Conducting carpentry work on Department of National Defence premises for a department-funded project introduced a fundamentally different level of conflict risk,” he wrote.The findings revive broader concerns raised in a 2022 procurement review, in which Jeglic warned of an “uneven playing field” across defence contracting.That earlier report found suppliers with inside knowledge could exploit their advantage, charging higher prices due to limited competition.In some cases, the review suggested information may have been shared with winning bidders before contracts were even formally offered.“The department did not conduct a fair, open or transparent solicitation process,” the report stated.“In each case the solicitation process was tainted.”
