Public Paying Too Much for Major Construction Projects

September 9, 2014
Cardus

HAMILTON, September 9, 2014—A report published today by Hamilton-based think tank Cardus says Ontario could free anywhere from $188 million to $283 million a year simply by making small changes to the way it procures major public construction projects.

"The reality is that the public is not getting good value or a bang for its buck," said Brian Dijkema, coauthor of the report and director of Work and Economics at Cardus. "When construction projects are tendered in such a way that costs rise 20 to 30 percent, there's clearly something wrong."

Currently a section of the Ontario Labour Relations Act has forced major municipalities including Toronto, Hamilton, Sault Ste. Marie, and the Region of Waterloo to be certified as "construction employers," preventing 70 percent of local companies from competing for local construction projects. The paper, Hiding in Plain Sight: The Need for Fairness and Fiscal Responsibility in Construction Procurement, examines the impact of these restrictions.

"When Ontario and its cities are in desperate need of infrastructure and short on cash, we should be making sure our dollars go as far as they can," said Dijkema. "It's time we encouraged healthy construction competition that results in greater efficiency, fairness, and savings."

The report, co-authored with procurement expert Stephen Bauld, is the latest publication of the Cardus Construction Competitiveness Monitor. Cardus is a think tank for social innovation that builds intellectual capacity, social networks, and policy alternatives to sustain a wide range of cultural entrepreneurs involved in the study and renewal of North American social architecture.

The report and previous publications can be found at here.

Media Contact: Naomi Biesheuvel nbiesheuvel@cardus.ca

ABOUT CARDUS

Cardus is a non-partisan, not-for-profit public policy think tank focused on the following areas: education, family, work & economics, social cities, end-of-life care, and religious freedom. It conducts independent and original research, produces several periodicals, and regularly stages events with Senior Fellows and interested constituents across Canada and the U.S.