The Société de transport de Montréal (STM) broke the law and its own contract management rules when it amended three contracts awarded to suppliers, which led to an explosion in costs, the Office of the Inspector General found. (BIG) in a report filed with city council Monday afternoon.
The Inspector General, Me Brigitte Bishop, examined three problematic contracts awarded by the STM in 2019 and 2020. The first contract, which concerns the supply of office supplies, was awarded at a cost of $ 398,796, but changes to the order increased its value at $ 1.7 million, an increase of 336%. The second, the initial cost of which was 7.9 million, targets the supply of office furniture. Successive increases totaling 129% have jumped the bill to $ 18 million. In both cases, the increase in costs is attributable to the increase in the quantity of goods ordered.
The third contract, awarded at a cost of $ 459,000, was for the distribution of promotional items. The addition of a mandate to distribute washable masks to STM customers in the context of the COVID-19 pandemic and the obligation to wear a face cover in public places increased the bill to 745,571 $, an increase of 62%.
The STM would not have complied with article 102.1 of the Act respecting public transit companies, estimates the OIG in its mid-year 2021 report, made public on Monday. This law authorizes modifications to contracts, but only in the event that the modification made to the contract is “ancillary”, which is not the case for the three contracts analyzed, indicates Mr.e Bishop.
“With regard to the contract for the supply of office supplies, a one-off increase of 336% is of such magnitude that it has the effect of making the initial contract ancillary”, underlines the OIG.
Additions and errors
The regulations concerning the STM’s contract management allow certain modifications to contracts already awarded, particularly in the event of an unforeseen event. But this is not the case in the contracts examined. For the supply of office furniture, for example, the addition is more attributable to an increased need for furniture for new projects or for the development of newly rented spaces unrelated to the initial contract, notes the Inspector General. The STM cited to the OIG a lack of personnel, a reorganization and a migration of the supply management software to explain the successive increases in the cost of the contract.
In the case of the contract for office supplies, it is an error in the quantities entered in the price schedule that is at the origin of the increase in costs, it is pointed out. When it noticed the error, the STM should have canceled the initial call for tenders and published another with the corrected quantities, which would have encouraged the bidders to offer more competitive prices given the increased quantity of supplies. required. The STM failed to do so, preferring to increase the value of the current contract and exercise tighter control over the use of the project’s monetary envelope.
During the investigation carried out by the OIG, the STM implemented various control measures and gave new directives to its employees, recalling the provisions of its regulations concerning contract management, the report said.
The contracts under investigation have ended or are about to be terminated, but Mr.e Bishop considers the results of the investigation to be “serious”. It therefore recommends that the STM adopt an action plan for awarding contracts in order to include remedial measures.
Watch video
Reference-feedproxy.google.com