Talk about being penny wise.
Blacklock’s Reporter says a federal manager coached a favoured contractor how to invoice one penny below the Treasury Board threshold on a sweetheart contract.
Access to information documents show in 2020 lawyer Raj Anand, of Toronto, and partner with Weir Foulds LLP, was awarded the sole-sourced $39,999.99 contract by a federal agency, the Immigration and Refugee Board.
Anand is a former Ontario human rights commissioner.
Anand billed at $650 an hour and the contract was awarded by the Refugee Board’s Office of Integrity.
“Given the private nature of refugee hearings it is not in the public interest to solicit bids,” wrote Alan Ritchie, then-director of the integrity office.
Ritchie hired the lawyer to conduct an ethics investigation of a board member.
“Mr. Raj Anand of the law offices of Weir Foulds was selected to perform these services because he has the particular expertise and experience required to perform the services,” wrote Ritchie. The favoured contractor was “extremely well suited,” he added.
Ritchie awarded the contract valued one cent below $40,000, the maximum threshold set by the Treasury Board before federal agencies must put contracts to competitive bidding.
But, in a March 25, 2020 e-mail exchange with the contractor, Ritchie discovered actual expenses could push the contract just over the $40,000 limit.
“Hello Raj,” wrote Ritchie.
“Our contracting folks inform me that the total contract value cannot exceed $40,000 including taxes, fees and all costs. Would it be reasonable to attribute up to $200-$500 of the contract to the disbursements? Please advise what amount you think appropriate to attribute. Regards, Alan.”
Anand replied: “Hi Alan. I think the disbursements would be minimal so $200 should be fine.”
The contract subsequently listed disbursements at $200 ensuring the total value of service fees stayed under $40,000.
The Refugee Board on Tuesday would not comment on the e-mails.
Cabinet in 2019 rewrote Government Contracts Regulations to raise the cap on sole-sourced service contracts from $25,000 to $40,000.
“Federal departments were strongly in favour,” the Treasury Board wrote in an earlier regulatory notice.
MPs and procurement ombudsmen have long criticized the practice of awarding contracts to favoured suppliers without competitive bidding.
“We should look into who’s getting favourable treatment and if it’s a good use of taxpayer dollars,” Conservative MP Bob Zimmer (Prince George-Peace River, B.C.), former chair of the Commons ethics committee, said in an earlier interview.
“We have multiple companies that build widgets. That means we should have a competition that’s open and we can all compete for widgets.
“The amount of sole-source contracting is concerning, absolutely. Competition is a great thing for everybody. It’s a price leveler. I think as taxpayers we want to see as much of that as we can.”