Contracting - May 2013
A disclosure was received alleging that a manager, the respondent*, working at the Trent-Severn Waterway National Historic Site of Canada, breached contracting policy and regulations. An investigation was held to follow up on the disclosure.
The investigation revealed that between 2007 and 2011:
Through contract splitting the respondent contravened the Financial Administration Act, R.S.C., 1985 c. F-11 and the Government Contracting Regulations (SOR/87-402) by failing to have properly exercised delegated financial authorities and by failing to solicit bids for the provisions of goods and services for which the value exceeded $25,000.
The respondent demonstrated gross mismanagement by institutionalizing inappropriate contracting practices, including contract splitting and inappropriate use of sole source contracts, in the area under his responsibility, by omitting to implement appropriate contracting practices communicated by internal communications and training offered by the Parks Canada Agency and by demonstrating clear negligence in failing to report the challenges surrounding contracting practices in his area of responsibility and in failing to request the necessary support.
The respondent showed misuse of public funds by systematically failing to follow Treasury Board contracting policies and Parks Canada standard operating procedure, by misusing a low dollar value procurement instrument to circumvent existing financial procedures and policies, by omitting to ensure that contracting files were duly completed by his staff and by giving preferential treatment to two companies.
The respondent directed his staff to commit wrongdoing by asking them to do contract splitting.
The investigation did not reveal that the respondent derived personal gain from the situation. The investigation showed, rather, a manager who has exceeded his financial authority and failed to ensure sound stewardship of the resources under his responsibility. The respondent no longer works at the Parks Canada Agency.
The investigation also revealed a lack of discipline in implementing a management and control framework for contracting and recruitment, hiring and supervision of employees and students with personal or family relationships with Parks Canada Agency employees. Also, the investigation raised some concerns regarding the local management team's cohesion, the degree of vigilance exercised by some members of the team and the leadership exercised by local senior management of the business unit.
Although the investigation did not demonstrate that these deficiencies constituted wrongdoing, some of them enabled the respondent to commit the above-mentioned acts. This situation also put the business unit at risk for future deficiencies.
In order to strengthen and implement a proper Management Accountability Framework for financial and procurement activities and recruitment, hiring and supervision of employees and students who have personal or family relationships with employees of the Parks Canada Agency, it is recommended:
- To ensure appropriate guidance and advice from the Chief Financial Officer's Directorate to the local executive and the F&A Manager with regard to strengthening financial and procurement controls and processes.
- To establish and implement standardized processes and procedures.
- To review the current delegation of authorities within the business unit.
- To perform a knowledge and training gap analysis for managers and administrative assistants with regard to delegated authorities, procedures, processes, policies and directives and to ensure that employees have completed the mandatory and appropriate training according to their delegated authorities and responsibilities.
- To implement consistent and standardized monitoring and challenging functions for administrative assistants and managers to ensure proper oversight of risks.
- To establish and implement an accountability strategy for non-compliant situations.
- To reassess local purchase order agreement requirements for low dollar purchases against increased use of acquisition cards which offer volume discount rebates and proper audit trails.
- To improve the management of information to ensure proper documentation is kept.
- To provide values and ethics and leadership training to the local management team.
- To identify current personal and family relationship situations in the workplace and ensure they are managed appropriately, as per the direction provided in the directives.
Since the respondent no longer works for the Parks Canada Agency and given that the investigation did not reveale that personal gain was derived there is no recommendation about managing this non-compliant situation.
Integrity is a fundamental value for Parks Canada, as it is essential to strengthening and preserving the relationship of trust between Canadians and the Parks Canada Agency. The Agency expects its employees to be guided by this value and provides encouragement in this regard. The members of the Parks Canada management team have heavy responsibilities with respect to the integrity of practices and activities at the Agency.
The investigation findings and recommendations were submitted to the most senior decision-making authorities at the Agency. Parks Canada agrees with the recommendations and is making a commitment to putting them into practice.
During the course of the investigation a new Field Unit Superintendant was nominated and the local management team was renewed. This revealed to be helpful for the implementation of the recommendations as some action has already been taken:
- Performance management plans are being established for all managers with clear expectations. Managers were provided with coaches, mentors or functional advisors.
- The Chief Financial Officer and Chief Human Resources Officer were tasked with providing the coaching and support required to act on the recommendations.
- A review of all delegated authorities and mandatory training was undertaken. Training plans have been put in place for employees who have not taken mandatory training in human resources management and finance.
- The business unit has begun the transition to increase the use of the acquisition card to acquire low dollar value goods.
- All the members of the management team have taken basic contracting training.
The other recommendations concern an in-depth review of administrative processes and practices and strengthening of the ethical culture of the business unit concerned. To ensure they produce tangible, sustainable results, these recommendations will be implemented over a specific period of time. Local management of the Trent-Severn Waterway National Historic Site of Canada was tasked with establishing and implementing an action plan. The action plan will be followed up.
* The use of the masculine is to simplify the text.