July 23 Blog

The Low Down on Construction – July 23

I think we can all agree that politics sometimes get in the way of good public policy. Governments of all stripes have been known to let special interests, ideology, or polling numbers blind them to effective policy in the public interest. In these instances, a government has either pandered to, or rewarded a narrow base of supporters, confusing what is good for the party with what is best for the public.

This is why MERIT took notice of the recent decision by the NDP government in British Columbia to reward union bosses by going back to the future and implementing Community Benefit Agreements (also known as Project Labour Agreements – PLAs) for public procurement and projects. PLAs mandate either a portion or an entire publicly funded project be awarded only to union-affiliated contractors. It’s an idea that was in vogue throughout the 20th century but has been roundly rejected as backwards and out of date in today’s procurement arena.

Most provinces, Saskatchewan included, used to use PLAs. Most provinces, Saskatchewan included, have long since stopped, recognizing them as unfair, costly, and a proven failure for effective public procurement.

MERIT is not saying that contractors or suppliers with union-affiliation should be prevented from bidding on projects. That would be just as unfair and unreasonable. The issue stems from the lack of competition and options that PLAs impose, raising costs for the public and putting open contractors and their workers at a disadvantage.

In BC’s case, they called the PLA a “community Benefit Agreement”, which couldn’t be farther from the truth.  Restricting bidding to just 15% of the pool of contractors certainly is not in the interests of the general community.  Open shop contactors are the small, locally owned and operated companies that are hiring local people and buying local goods.  You can’t provide much more benefit to the community than that.

By keeping public procurement open to all qualified bidders, big and small, open and closed shop, corporate or independent, taxpayer costs will be minimized, local employment will be optimized, and the public interest more broadly served.

In Saskatchewan, we are proud to say we are open for business, and MERIT has worked very diligently to ensure a fair and even playing field for ALL contractors.  After all, fair competition should be the foundation of sound public policy.

Interested in reading more about the failure of PLAs?  Click HERE for the recently- released Cardus report.