Procurement practice review of the Correctional Service of Canada

Mandatory criteria

Most mandatory criteria were not overly restrictive and, for the most part, were aligned with requirements; however, some files did not define mandatory criteria in a clear, precise and measurable manner.

18. Mandatory criteria in solicitation documents identify the minimum requirements that are essential to the successful completion of the work. Of the 31 files that contained mandatory criteria, these criteria were not overly restrictive, did not unnecessarily favor or penalize any particular bidder except for 1 file, and in all but 3 cases, were aligned with requirements. However, in 8 of 31 files, mandatory criteria were not communicated in a clear, precise or measurable manner.

Unclear, Inadequately Defined or Unmeasurable Mandatory Criteria

19. Unclear evaluation criteria can undermine the transparency of the bid solicitation process and can cause bidders to submit non-compliant or sub-optimal proposals because the requirements are not well understood. Some examples of unclear, inadequately defined or unmeasurable criteria are provided below.

1. In 1 file for the provision of translation and interpretation services, 3 of the 4 mandatory criteria required experience associated with a “wide variety of languages.” In the solicitation, it was unclear as to what would be required to meet the definition of “wide variety of languages”. While OPO recognizes that CSC cannot predict what languages will be required and that language requirements may change on daily basis, it is important that all mandatory criteria be measurable as it is more difficult to demonstrate that criteria have been strictly adhered to when the criteria are open to multiple interpretations.
2. In 2 other files, the mandatory criteria required bidders to provide resumes, but they did not define/specify what must be included in the resume to meet the criteria. For example, in 1 file for educational and library services, bidders were required to “demonstrate in resume that at least one of three aforementioned instructors are fully bilingual (English and French) and able to offer Level 1, 2 and 3 in French, when required”. The wording of this criterion is problematic because there was no definition or explanation of what constituted Level 1, 2 and 3 in French. Similarly, in 1 file for the provision of community assessment and parole services, a mandatory criterion noted that “the bidder must provide a current resume of the person proposed to do the work” but CSC did not state what content must be included in order to meet the criterion. As currently written, simply providing a resume of any sort would meet the criterion.
3. In 1 file for hotel accommodations, a mandatory criterion required that the hotel have laundry facilities on site. In order to meet this requirement, the Bidder must provide a brochure or detailed description. There was no explanation provided as to what these laundry facilities must entail (for example, number of machines, dry cleaning services, in-suite services… etc.).
4. In 1 file, a mandatory criterion could not be assessed by evaluators at time of bid closing. Specifically, the mandatory criterion required that the “bidder must certify in writing that the proposed resource can come on-site to both Warkworth Institution (Campbellford) and Joyceville Institution (Hwy 15 Kingston) within 24 hours notice in case on-site emergency support is required”. While it is good that CSC requested that this be confirmed in writing, it should form part of the Statement of Work/Contract and not a mandatory criterion as it is impossible to evaluate in terms of pass/fail at the time of bid close (as it is a future requirement).

Restrictive Mandatory Criteria

20. Overly restrictive evaluation criteria undermine the fairness and openness of the bid solicitation process by restricting the number of suppliers capable of submitting a compliant proposal and limiting CSC’s ability to obtain competitively-priced alternatives capable of meeting its requirements.

21. There was 1 file for which the mandatory criteria were unnecessarily restrictive or appeared to unnecessarily favour a bidder or group of bidders. In 1 file seeking a risk management specialist, a mandatory criterion required the bidder’s proposed resource have “a minimum of twelve (12) months of experience in managing and/or operating water and wastewater treatment system operations in a secure* and correctional environment**”. The restrictiveness of the criteria was flagged by the Contracting Authority to the Technical Authority in an email. The Technical Authority provided a rationale to keep the criteria and noted “drinking water and wastewater operations at a secure facility, such as CSC, are very different from municipal systems (we have operational data, pictures and testimonial/comments from various consultants) for several reasons”. While OPO recognizes the specific intricacies of CSC facilities, this criterion appears overly restrictive and may have deterred bidders other than the incumbent from responding to the solicitation. In reviewing the communications on the file, OPO identified at least 40 bidders that received the bid information package, and yet CSC only received 1 bid, from the incumbent provider. The proposed resource submitted by the incumbent had been working at CSC since October 2014. Suppliers that are aware of any advantage they possess have the ability to leverage it in terms of charging CSC higher prices, knowing there is limited competition.

Guidance documentation

CSC has guidance in place to support fair, open and transparent procurements.

29. CSC’s CMS Directorate is responsible for developing national policies and procedures for CSC procurement and contracting, providing guidance and oversight to regional CMS, among other responsibilities. CMS has developed many internal directives, policies, guidance documents and training courses to support fair, open and transparent procurements. During the review period, CSC had in place 3 Contract Review Boards (2 regional review boards and 1 national review board), whose role is to “ensure prudence and probity in the expenditure of Public funds within CSC”. According to CSC, in March 2022, an additional Contact Review Board at the national level was established. In May 2022, CSC noted that it is “currently undertaking a contracting policy suite reset to ensure requirements are current, they adhere to recent Treasury Board Secretariat (TBS) policy changes [(for example, the new Directive on the Management of Procurement)], and that they meet the needs of contracting authorities/business owners”.

Solicitation documents

Solicitation documentation was mostly complete; however, opportunities for improvement were noted regarding instructions to bidders, choice of procurement vehicle and communications during the solicitation period.

30. In 35 of 39 files reviewed, solicitation documents included clear and complete descriptions of the requirement, supporting transparency in the procurement process; and in 37 of 39 files reviewed, the solicitation was open to an appropriate number of suppliers. Some opportunities for improvement were noted regarding the design and execution of the solicitation process, notably with regard to bid submission instructions and communications with suppliers. Further details on these files are presented below.

31. In 6 files, instructions for submitting bids lacked clarity. For example:

1. In one instance, the solicitation opening/closing dates in the RFP document did not align with what was posted on Buy & Sell (Government Electronic Tendering Service). On the Buy & Sell webpage, it was noted that the solicitation opened on March 20, 2020 and closed on April 28, 2020. However, in the RFP document posted on the platform, it was noted that the solicitation opened on March 9, 2020 and closed on April 17, 2020. It is critically important for these dates to be identical in order to avoid any confusion for potential bidders and prevent avoidable issues of non-compliance.
2. In another solicitation, the submission of bid instructions noted that bids had to be submitted in hard copy. The Contracting Authority reiterated to a supplier that bids could not be submitted by email. However, later that day, the Contracting Authority emailed that same supplier to indicate that electronic bids would now be accepted. A formal amendment was not issued, but should have been in order to inform all potential bidders of the opportunity to submit electronic bids. Not doing so raises fairness issues as other suppliers may have bid if they had been aware of the opportunity to submit electronic bids, as it is less burdensome than submitting a hard copy bid.

32. Furthermore, the duration of the bid solicitation period was appropriate in all but 3 files. For example, in 1 file for hotel accommodations, for which the procurement was subject to the World Trade Organization Agreement on Government Procurement (WTO-AGP), CSC reduced the solicitation period to 22 days from the required 40 days. In another file for the rental of five refrigerated trailers for food storage, which occurred at the beginning of the COVID-19 pandemic, the RFP was open for less than 1 business day. It was sent to potential bidders at 8:47 AM on March 27, 2020 and bids were due by 2:00 PM.

33. In 1 file for the provision of a risk management specialist, CSC utilized the Task and Solutions Professional Services (TSPS) SA, specifically Stream 3.6—Risk Management Specialist. During the course of its review, OPO identified that this solicitation represented an inappropriate use of the TSPS SA as the requirement in its entirety did not align or appear to be related to the category and stream. Per the category, some tasks include (but are not limited to) conducting risk assessments and evaluating potential risk and losses, identifying project and procurement risks, reviewing and auditing claims, etc. In this case, the proposed resource has to be a professional engineer and environmental auditor (M1), have worked in water/wastewater in a correctional facility (M3), wrote standard operating procedures “for operational and maintenance procedures for at least 5 treatment systems (both water and wastewater)” (M4), etc. By not using the appropriate supply arrangement and/or relevant stream, the openness of the procurement process may have been impacted because suppliers that may have been able to fulfill this requirement may not have been aware of the opportunity to bid.

Communication with suppliers

34. Section 2 of the TBCP states: “Government contracting shall be conducted in a manner that will: (a) stand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds.” Section 12.3.1 of the TBCP also states: “Procurement files shall be established and structured to facilitate management oversight with a complete audit trail that contains contracting details related to relevant communications and decisions…”

35. These requirements apply to all aspects of the procurement process, including interactions with suppliers. In addition, for procurements subject to the Canadian Free Trade Agreement and the WTO-AGP, section 12.3.2 of the TBCP requires contracting authorities ensure all communications with bidders are supported by complete documentation and records to demonstrate that the procurement process was carried out in accordance with the agreements. Any significant information given by a contracting authority to a supplier with respect to a particular procurement must also be given simultaneously to all other interested suppliers.

36. Of the 39 files reviewed, excluding 3 files for call-ups issued under standing offers, 24 contained communications (i.e. questions and answers) with suppliers during the solicitation period. In 18 files, communications were appropriate and supported the preparation of responsive bids. In 6 files, however, communications did not support the preparation of responsive bids. Examples included the following:

37. In 3 files, potential bidders were not provided with access to the same information at the same time after posing questions during the solicitation open period.

1. In 1 file, a questions and answers (Q+A) document was prepared and answered 7 questions, however it was not posted on Buy & Sell despite the solicitation being open to all suppliers. It appears that the amendment was shared directly with only one supplier. This document provided answers to many questions seeking clarity on how to meet the mandatory and rated criteria (for example, security requirements, number of words, types of requests, etc.).
2. In 1 file, OPO was able to locate evidence of at least 16 questions being posed during the solicitation period, yet CSC did not issue a Q+A document to respond to them. Some questions were answered directly by email to one supplier, while others were not answered at all. It is unclear why a questions and answers document was not posted.
3. In 1 file, while CSC did issue one amendment with Q+A’s and shared it with all bidders, a follow-up question asking whether there was an incumbent was answered directly via email only to the bidder who posed the question.

38. To support fairness of the process and avoid the perception of favoritism, all potential suppliers should be provided with access to the same information and answers to questions at the same time. In the above examples, the information could have been relevant and useful to other potential bidders in the preparation of their bids, or in deciding whether or not to submit a bid.

Communications when using Public Services and Procurement Canada methods of supply

39. When PSPC’s methods of supply are used, such as the Professional Audit Support Services (PASS) or Task and Solutions Professional Services (TSPS) SAs, certain procedures must be followed including performing a search in the Centralized Professional Services System (CPSS) to identify the qualified suppliers to be invited. In 1 file for an external performance measurement and evaluation committee member where the CPSS was to be used to identify the qualified suppliers to be invited, the contract file was missing evidence of the search performed to identify the 15 suppliers invited to bid. The eventual winning bidder was not one of the original 15 suppliers invited to bid on this requirement. It is unclear how the winning bidder received the bid documents as OPO could not locate any email/correspondence on the file where the winning supplier requested the documents or when CSC sent it to them. This should have been documented on the file in order to preserve the transparency and integrity of the procurement process.

Bid evaluation

Significant inconsistencies in the evaluation of bids and deviations from the planned approach were noted and, in several instances, no evaluation records were on file.

43. In 5 of the 36 files, CSC was unable to provide any evaluation records. In 3 of those files, CSC stated there were no evaluation results on file because the solicitation processes and/or evaluations had taken place at the start of COVID-19 pandemic, which may have contributed to the missing documentation. In the 2 remaining files, CSC did not provide a response as to why there were no evaluation records. Without this key documentation, OPO cannot verify if CSC properly evaluated the bids, and CSC cannot demonstrate that the contract was correctly awarded, bringing the integrity of the procurement process in to question.

44. In 4 files, where evaluation records were available, the evaluation grid used by evaluators was not identical to the criteria found in the solicitation document. For example, a solicitation for physician services contained 2 mandatory criteria and 9 rated criteria, but there is no record of the rated criteria being evaluated. The evaluations on the contract file only looked at the mandatory criteria, thus OPO cannot determine whether the sole bid was compliant and/or if the selection methodology was followed. The value of this contract was $1,400,000. A similar observation was found in another file for risk management services, where the evaluation grid was missing a mandatory criterion (M5), thus there is no evidence on file to support that the sole bidder met that requirement.

45. In 1 file for snow removal services, the 5 bids received were not assessed against the mandatory criteria in the RFP. As shown in the table below, the RFP included the evaluation criteria in the left column. The right column was the evaluation criteria that each proposal was evaluated against. For example, while the bidder was asked demonstrate a minimum of 5 years’ experience in providing snow removal and ice control services, this was never evaluated by CSC in their evaluation grids.

46. Evaluations not conducted consistently and in the manner prescribed by the solicitation call into question the integrity of the procurement process. By not adhering strictly to the evaluation criteria identified in the solicitation, CSC has exposed itself to the risk that ambiguities in the selection process result in the contract being wrongly awarded. Another risk is that potential bidders decide to bid or not bid based on inaccurate information contained in the solicitation that is not carried forward to the evaluation stage of the process. It also means CSC may not be able to defend and explain its decisions and actions and prove that they were made in accordance with the applicable laws, regulations, and policies.

Evaluation Instructions/Guidelines not frequently used

47. A good practice with regard to the evaluation of bids is the requirement to provide evaluation instructions to each member of the evaluation team and to have them each sign a document acknowledging their responsibilities to protect the confidentiality and integrity of the process and certifying that there is no conflict of interest in them participating as an evaluator.

48. In 26 files, OPO was unable to locate evidence that an evaluation plan/instructions to assess bids was provided to evaluators, or locate signed conflict of interest forms. Throughout the review, OPO observed that the approach to providing an evaluation plan/instructions to evaluation team members differed across the various regions. CSC clarified to OPO during the review that there is no policy in place with respect to providing instructions to evaluators. CMS contracting authorities share the evaluation plan with business owners when they obtain approval of the solicitation documents, including the evaluation plan from the relevant authorities prior to posting.

49. The evaluation practices noted above demonstrate that CSC had not consistently implemented effective supervision and review mechanisms to ensure evaluations were carried out in accordance with the planned approach, appropriately documented to support the transparency of the award process and avoid potential conflicts of interest.

50. Additionally, in 2 instances where evaluations were on file, OPO could not confirm the identities of the evaluators as their signatures were not legible and were not accompanied by printed names. Had there been additional documentation on the file, such as signed evaluation guidelines, OPO would have been in a position to validate the signatures.

Accepting non-compliant bids

51. Evaluation records were available in 31 files. In 5 of these files, non-compliant bids were accepted and a contract was awarded to a non-compliant bidder. Examples include the following:

1. In 3 files, CSC evaluated certain mandatory criteria as “met” despite not having the documentation required to validate that finding:
   1. In 1 file for small appliance repairs, the first mandatory criterion stated bidders “must provide a copy of certification and/or license to perform this type of work, i.e. Refrigeration Repair License and Certificate of Appliance Repair.” To satisfy this criterion, the winning bidder submitted a photocopy of a certificate from the Nova Scotia Department of the Environment which states: “ [name] has successfully completed an approved environmental awareness course respecting ozone-depleting substance control in the refrigeration and air-conditioning industry”. This certificate does not appear to meet the requirements of the criterion and should have been deemed non-compliant.
   2. In 1 file for self-contained breathing apparatus (SCBA) flow testing, all three (3) bids received were deemed compliant. However, it appears that 2 of the 3 bids (including the winning bid) should have been deemed non-compliant. In the solicitation, M3 required “a confirmation letter from MSA that the company is deemed qualified to perform the required inspection and testing. A list of qualified staff name must be provided”. With regard to the winning bidder, they did not provide a list of qualified staff but instead only provided the letter with regard to the company.
   3. In 1 file seeking a radiologist technician, the bidder was required to provide proof of membership and a letter of good standing with the Nova Scotia Association of Medical Radiation Technologists as well as a copy of their diploma demonstrating that they graduated from an accredited medical radiation technology program. The winning bidder (only bid received and the incumbent supplier) did not submit either document at bid close (they were submitted thereafter). This was noted by the evaluators in the evaluation of the bid, yet CSC still awarded a contract to a non-compliant supplier.
2. CSC solicitation documents typically state that bids must be submitted only to CSC by the date, time and place indicated on page 1 of the bid solicitation. However, in 2 files, CSC accepted bids in which the bidders did not follow the bid submission instructions.
   1. In 1 file for psychological risk assessment, emails on file indicate that the winning bidder (only bid received and the incumbent supplier) submitted the bid submission package on May 5, 2020, which was after bid close of April 17, 2020. OPO could not locate any amendment on the contract file or on Buy & Sell that would have extended the bid closing date. The bid should have been deemed non- compliant as it was submitted after the deadline.
   2. In 1 file for fire alarms and safety systems, the RFP stated the bids must be sent to a particular physical address, but the winning company submitted their bid via email. The Canadian International Trade Tribunal (CITT) has ruled that “it is well established that the onus is on the bidder to demonstrate that it meets all essential requirements of a procurement, which includes the requirements regarding bid submission”. Furthermore, “it was incumbent on [the bidder] to exercise due diligence in the preparation and delivery of its bid to ensure that it understood and was compliant with all the instructions in the RFP”.

52. CSC should have deemed all 5 of the bids noted above to be non-compliant. The acceptance of non-compliant bids is problematic because it could and did lead CSC to award contracts to non-compliant bidders, which compromises the integrity and overall fairness of the procurement process.

Regret letters were present in all applicable files

53. After the solicitation process is completed and bids evaluated, CSC consistently informs bidders of the evaluation results via either a regret letter advising the bidder it was not the successful bidder, or an award letter advising the bidder it was selected for contract award.

54. “Regret” letters are sent to unsuccessful bidders and should offer an explanation of why their bids were not selected. They are an important tool as they alert bidders to the fact that the contract has been awarded to a competitor, should they wish to seek a detailed debriefing from the contracting department or avail themselves of potential recourse mechanisms such as OPO or the CITT.

55. Of the 22 applicable solicitation processes reviewed for which there was more than 1 bid, all files contained records notifying the unsuccessful bidder(s) of the results of the evaluation. This demonstrates that CSC acknowledges the importance of being open and transparent with all bidders, as well as the importance of debriefings. When regret letters were issued, they provided a detailed account of why the bidder had not been awarded the contract and included the results of the technical evaluation of their bid as well as the overall score of the winning bidder.

File documentation and file structure

56. Section 12.3.1 of the TBCP requires that procurement files facilitate management oversight with a complete audit trail containing details related to relevant communications and decisions, including the identification of the involved officials and contracting approval authorities. The requirement to ensure adequate file documentation extends to the actions undertaken during the solicitation period, the evaluation of bids, as well as the overall procurement file.

57. File documentation was reviewed to determine whether a complete audit trail was on file to support consistent and transparent decision-making. As was noted earlier in this report, there were 26 files in which OPO could not locate an evaluation plan/instructions to assess bids, or signed conflict of interest forms. Additionally, 14 of those 26 files were also missing key documents, including correspondence with prospective bidders and/or bid evaluations. OPO recognizes that CSC’s ability to access hard-copy files may have been impacted by COVID-19 pandemic-related office closures and that some of the missing documents may be located in the applicable regional CSC offices.

58. Incomplete procurement files resulted in inadequately supported procurement actions that risk undermining the transparency of the procurement process. Keeping complete and detailed records is crucial to demonstrating that evaluation criteria have been applied equally to all competing bids, and demonstrating that the procurement has been carried out in a manner consistent with CSC’s obligations under applicable trade agreements, the Financial Administration Act and regulations made under it, and the TBCP. Failure to maintain complete records also places CSC at risk of not being able to defend challenges to the procurement process.

59. OPO would like to acknowledge that although 26 procurement files lacked key documentation, the manner in which the entirety of the files were transferred to OPO was efficient and organized. Despite being a decentralized procurement operation, each file (regardless of region) that was transferred to OPO contained the same logic and folder structure, which made key documents easily identifiable for OPO’s review team.