Toronto Opts for Closed Tendering, Against Recommendations from City Staff
Toronto—The city of Toronto had a chance to adopt open tendering for its municipal ICI projects, allowing all qualified workers and contractors to access jobs in their communities while saving the city millions of dollars. Instead, they chose to remain closed, against the recommendations of their own staff, as well as numerous studies that showed that closed tendering adds millions of dollars in extra costs to city projects.
“We are very disappointed that city council did not seek the good of the citizens, but instead bowed to the pressure of a few very powerful unions,” says Ian DeWaard, CLAC Ontario director. “They had a chance to be fair and fiscally responsible, but instead chose to appease a select few.”
Toronto has been under a construction monopoly for more than 30 years. Ontario’s recently-passed Bill 66 offered the opportunity to be freed from a loophole in Ontario labour law that resulted in the city being treated like a construction contractor, rather than a purchaser of construction services. Under Bill 66, municipalities are deemed “non-construction employers,” so they can no longer be victims to closed tendering in the future. However, four municipalities that had already been subject to construction monopolies were given the option to remain closed. Toronto bowed to the pressure of the unions that enjoy the monopoly and opted to remain closed.
“Research from economists in Canada and the UK suggests that open tendering could have saved $48 million to $150 million every year,” says DeWaard. “That money could have been used to tackle much-needed infrastructure projects. It is difficult to understand how they could reject this opportunity when they know that their budgets are facing constraints from the province.
“In addition to the extra costs of closed tendering, it is extremely unfair to construction workers in the city. The majority of construction workforce in the region remain non-union or belong to alternative unions. These workers and their employers are barred from working on all projects that their tax dollars pay for.”
Currently, Toronto is the only one of the four municipalities that has chosen to remain under a construction monopoly. The four municipalities have until July 3 to announce whether they will choose to remain closed. The Region of Waterloo and City of Sault Ste. Marie have signalled their intent to open tendering to all qualified bidders.