Reform of public contracts | “Butt” gains, or realistic?

Never would I have thought I would write the terms “sexy”, “butt” and “ Public Bodies Contracts Act » in the same text, but everything needs a beginning.

So here it is. Follow me carefully.

Last March, I revealed to you the reform that is taking place in Quebec to review the planning of major infrastructure projects¹.

Basically: the Legault government wants to modernize its very rigid ways of doing things. Its objective: to reduce the average bill by 15% and speed up construction times for schools, roads, hospitals and public transport networks by 25%.

There will be $150 billion worth of it in 10 years, paid for by you and me. The gains that we are left to believe are considerable.

After a long unraveling of several laws and regulations, and tough discussions between political cabinets, the bill to initiate this reform is ready. It will be tabled in the National Assembly on Thursday.

It will be heavy and daunting. Just like the debates which will follow in parliamentary committee.

But at the end of this exercise, Quebec hopes to reach an opposite state: that of lightness.

The government intends to make its contract award processes more flexible, and not just about so. Becoming “sexy” again with construction companies who have turned their backs on it in recent years, to use the expression of Jonatan Julien, Minister responsible for Infrastructure.

Enough to raise many hopes and some concerns.

Jonatan Julien explained to me in an interview the broad outlines of this reform, piloted with his colleague from the Treasury, Sonia LeBel.

He makes no secret of it: this “mini-revolution” greatly delights people in the construction industry. They are “making waves,” he told me.

Him too.

Mr. Julien describes these changes as “win-win,” as they should lead to more competition in public tenders. The State will benefit from it, entrepreneurs too, just like taxpayers.

In an ideal world, of course.

The strategy which will be revealed on Thursday, at the same time as the tabling of the bill, is divided into four axes and 17 measures. She casts a very wide net. Too much, even, some critics will say. “We went as far as we could go,” says the minister.

One of the major pillars will concern “collaborative and alternative” modes of realization. Quebec intends to integrate bidding companies earlier in the development phase of infrastructure projects, to determine more realistic concepts – and prices – from the start.

At present, entrepreneurs generally have to comply with the very strict demands of public project providers, without being able to add their two cents to the discussion. They add a generous margin in their submissions to compensate for unforeseen circumstances, which inflates the bill every time.

Quebec therefore wants to follow the trend adopted by several countries, and elsewhere in Canada, towards more flexible methods of awarding contracts. The principle defends itself very well.

Jonatan Julien assures that the estimated savings do not come out of a hat. He even believes he played “butt”, that is, in a prudent manner, by dangling gains in money and time of 15% to 25%.

The Société québécoise des infrastructures (SQI) carried out a “hyper-convincing” pilot project with a program for 13 fairly similar secondary schools. Four of them were built using an “alternative” method, while the others were made using traditional methods.

Results: the four schools built in collaboration with the contractors were delivered in 29 months, compared to 38 months on average for all the schools in this program (-24%). Their average cost was $7,270 per square meter, compared to $8,600 per square meter (-15%).

Gains that can be reproduced on a large scale, the government believes.

Big bet.

Jonatan Julien recognizes this: what will prove everything will be the planning of this mountain of public projects to come.

In public transport, this will go through a new agency. The creation of this structure will be the subject of a separate bill, which will also be tabled on Thursday by the Minister of Transport, Geneviève Guilbault. Skepticism is great.

At the level of the government apparatus, Jonatan Julien says that his ministry will act as a “control tower” to determine which infrastructure projects will be prioritized. This planning exercise will include, among other things, a better understanding of the capabilities of the construction industry in each region.

An industry, it should be remembered, which will also be heavily solicited by Hydro-Québec, with its 130 billion in projects planned between now and 2035.

The pace will be hard to follow, even if the Julien-LeBel reform were to bear fruit.

1. Read the column “Faster, cheaper: Quebec wants to become “sexy””