1. Taxes:

   • Sales tax from purchases

   • Income tax

   • Business taxes

   • Fees for licenses

2. Transfers:

   • Transfers from the federal government

1. Introduction to Public Sector SCM/Procurement

2. Public Agencies and Cooperative Purchasing

3. Broader Public Sector Directive and Trade Agreements (SILEx Introduction)

4. Risk Management and Case Analysis Review

5. Public Procurement and the Law

6. Competitive Bidding

7. Midterm Case Analysis

8. Document Building – Specifications and Scopes of Work

9. Document Building – Evaluation Criteria

10. Ethics and Fraud

11. SILEx Project – working period

12. SILEx Project Presentations

13. Contract and Supplier Management

14. Catch-up and review

• In-class group work: Respectful and polite behavior, arrive on time.

• Email communication: Polite and timely, within 24-48 hours during business hours.

• Office Hours: By request, possibly over Zoom.

• Clarification: Encouraged to ask for clarification promptly.

• Device Usage: Phones to be put away unless needed for class activities.

1. Module 1 Review:

• Recap of key concepts from Module 1.

2. Public Agencies:

• Overview of different types of public agencies.

• Examples: Municipal, Provincial, Federal Government, Healthcare, Education, Military/Security.

3. Cooperative Purchasing:

• Definition and purpose.

• Types: Piggybacked, Pooled, Consortium, Formal.

• Benefits and Challenges.

4. In-class Presentations:

• Groups of 4 present on a chosen Ontario public agency.

• Presentation guidelines provided.

Overview: The Broader Public Sector (BPS) in Ontario encompasses organizations that receive funding from the government but operate independently. This includes hospitals, universities, colleges, and school boards.

• Establishes requirements for compensation, expenses, perquisites, business documents, and procurement.

• Prohibits the use of public funds for consultant lobbyists.

• Requires designated BPS organizations to report on expenses and publicly disclose information.

• Sets out requirements for acquiring goods and services using public funds.

• Promotes open, fair, and transparent processes.

• Identifies responsibilities of BPS agencies throughout procurement stages.

• Accountability

• Transparency

• Value for money

• Quality service delivery

• Process standardization

• Centralization of procurement.

• Obligations under the Building Ontario Business Initiatives.

Mandatory Requirements:

• BPS agencies must incorporate 25 mandatory procurement requirements into their work.

• Hospitals are required to report compliance.

• Dollar thresholds ensure consistent sourcing rules.

• Municipalities, local boards, long-term care facilities, and boards of health.

• Funds provided from non-government sources.

Trade Agreements:

• Canada has 15 trade agreements with over 40 countries.

• Relevant agreements include the Canadian Free Trade Agreement and the Canada-European Union Comprehensive Economic and Trade Agreement.

• Trade agreements regulate procurement practices, including reporting obligations, transparency, and bid dispute resolution.

• Review of Module 3 and SILEx

• Risk Management

• Case Analysis Review

• Midterm Individual and Group Requirements

• Definition: Systematic approach to identifying and reducing exposure to loss.

• Components of Risk: Potential harm and Probability of harm.

• Options for Management: Avoiding, Transferring, Managing.

Avoiding Risk:

• Strategic approach to prevent events from occurring.

• Involves questioning and generating alternatives.

• Could include not using certain suppliers or cancelling projects.

Transferring Risk:

• Contractually shifting risk to another party.

• Often using insurance and bonding.

• Goal is to protect the agency financially.

Managing Risk:

• Done when risk is manageable.

• Involves effective project management.

• Contracts with suppliers play a crucial role.

Corporate Risk Management:

• Components: Leadership, Policies, Training, Staff Priority, Promotion, Contract Management.

• Insurance Types: General Liability, Professional Liability, etc.

• Bonding Types: Performance, Bid, etc.

Module 5 Agenda:

• Review of Module 4

• Public Procurement and the Law

• Common Law

• Law of Agency

• Contract Law

• The Queen vs. Ron Engineering

• Contract A and B

• Risk Formula: Risk = Potential of Harm x Probability of Harm

• Risk Management Techniques: Avoid, Transfer, Manage

• Common Law:

  • Based on judicial decisions and precedent.

  • No single legislation covers procurement.

• Law of Agency:

  • Governs the relationship between parties.

  • Agent acts on behalf of the principal.

  • Duties of agent and principal defined.

• Contract Law:

  • Requirements for a legally binding contract.

  • Case law examples: The Queen vs. Ron Engineering, Contract A and B.

• Bidder's Rights:

  • Duty of full disclosure and fairness.

  • Requirements of an Invitation to bid.

Integrity in Public Procurement

• Openness: Bids publicly posted

• Fairness: Equal opportunity for all qualified bidders

• Transparency: Processes handled transparently

Competitive Bidding

• Formal process for requesting products/services

• Ensures fair and transparent competition

• Demonstrates integrity in procurement

1. Request for Information (RFI)

2. Request for Expression of Interest (REOI or RFEI)

3. Request for Prequalification (RFPQ)

4. Request for Quotations (RFQ)

5. Request for Tenders (RFT)

6. Request for Proposals (RFP)

• Sole sourcing

• Single sourcing

• P-card purchases

• Unsolicited proposals

• Negotiation

• Closing time and date

• Sealed submissions

• Two-envelope system

• Conflict of Interest Declaration

• Qualifications (Pre-qualifications)

• Agency reserved rights

• Securities (surety or bid bond)

• Disqualification

1. Requisition received

2. Specification/scope of work created

3. Competitive document created

4. Posted to public bidding platform

5. Possible site visit

6. Bidder question and answer period

7. RFx closes, bids received

8. Review responses

9. Award to lowest (for Quote/Tender) or successful proponent (for Proposal)

10. Debrief unsuccessful proponents

Strategic Sourcing

• Identifying what the agency is buying: products, goods, capital equipment, services, consulting, subject matter experts, construction.

Requisitions

• Formal requests indicating the need for a purchase.

• Includes department information, budgets, employee contacts, timelines, and approval signatures.

• Sent to Procurement to initiate the project.

Specifications

• Describe physical/functional/performance characteristics of a good or service needed.

• Communicate agency needs to the public.

• Types include design, performance, brand names, industry standards, etc.

Design Specifications

• Establish characteristics and manufacturing details.

• May include engineering plans or blueprints.

Performance Specifications

• Describe how goods/services should function.

Brand Name Specifications

• Unique identifiers for products, may include "or equivalent" options.

Technical Specifications

• Detailed and clear requirements for goods/products.

Scopes of Work

• Describe needed services for projects.

• Used when technical specifications are not firm.

Things to Consider

• Users, suppliers, inventory, budget, costs, availability, technology, SOW.

Qualified and Unqualified Suppliers

• Qualified suppliers meet identified requirements.

• Unqualified suppliers misrepresent information or cannot meet requirements.

Qualifying Bids

• Suppliers can be disqualified for not meeting specified requirements.

Evaluation Criteria

• Unique to each scope of work, determines award.

• Proponents tailor responses accordingly.

• Agencies specify what proponents must submit.

• Mandatory requirements can result in disqualification.

• Evaluation teams assess submissions.

• Rule of thumb: 3-5 knowledgeable members.

• No research on companies allowed.

Evaluation Meeting

• Evaluation team discusses submissions.

• Procurement facilitates conversation.

• Scores collected, decision made if possible.

After the Evaluation Meeting

• Additional information or negotiation may be needed.

• Procurement issues contract and closes file.

• Debriefs provided to interested proponents.

1. Pre-proposal phase: Scope development, criteria establishment.

2. Open bid phase: Receive questions, issue addenda.

3. Post-close phase: Evaluation, interview, award, debrief.

The University of York has to choose between a good contractor (Bidder A) and a cheaper contractor (Bidder B) who have done bad things for the environment. They must consider quality, cost, ethical standards, and reputation when they make their decision.

Scenario 2:

Joy, a procurement officer at the City of Halifax, must deal with a conflict of interest when her friend Claudio asks for a landscaping contract. She must choose between treating her friend unfairly or being fair and honest when buying things.

Scenario 3:

As a new employee at London Health Sciences Centre, you need to decide whether to recommend MedGear, a company that sells cheap medical supplies but has bad habits. Things to think about include patient safety, supplier integrity, and ethical procurement practices.

• Guided by principles of openness, fairness, and transparency.

• Unethical behavior includes personal buying, accepting supplier favors, sharp practices, and reciprocity.

Codes of Ethics:

• Ontario Broader Public Sector

• Supply Chain Canada

• Ontario Public Buyers Association

Conflict of Interest:

• Personal benefit from official actions or decisions.

• Key questions: Does it feel right? Could it negatively impact me or my organization? What would a reasonable person think?

Ethical Issues in Public Procurement:

• Scandal, fraud, misuse of public funds, patronage, corruption, bribery, local preference, bid-rigging, collusion.

Implications of Unethical Behavior:

• Public perception, trust, legal consequences.

Supporting Ethical Behavior:

• Management leading by example.

• Disciplinary action against unethical behavior.

• Implementation of a code of conduct.