Transport Committee on May 30th, 2013

[Scott Clements]

Absolutely competitive. I couldn't agree more with everything that's been said here. It's a union town. We have a strong competitive process, in our case a stipulated fixed price. If you don't take that approach when you only have a certain amount of money—and we do—you're going to get cooked. We're very motivated to do that.

From what I can see, the municipality in its considerable spending is doing exactly the same thing. I think they're compelled to. Most of the oil companies are starting to figure out that they need to control costs and there's a lot more interest in doing that, rather than getting on with the job and to hell with the price.

[David McGuinty, Liberal, Ottawa South, ON]

Is there a closed bidding problem in Wood Buffalo?

[Scott Clements]

No, I don't think so. I haven't seen any closed bidding that is evident to me, anyway.

[David McGuinty, Liberal, Ottawa South, ON]

I can't recall the words used by your colleague, Mr. Taylor, in testifying today, but it was something about unions being.... I can't recall the word. I didn't think it was particularly helpful, in terms of the wording. I'm simply trying to get a handle on whether there's a problem here, or how big the problem might be in your area. What I'm hearing is that there isn't a closed bidding problem in place.

[Scott Clements]

No, it's usually open bidding.

[David McGuinty, Liberal, Ottawa South, ON]

Do you have unionized companies that are bidding on those contracts?

[Scott Clements]

Oh, yes.

[David McGuinty, Liberal, Ottawa South, ON]

Are they winning those contracts?

[Scott Clements]

Well, most of them are unionized. Most of the companies are unionized.

[David McGuinty, Liberal, Ottawa South, ON]

I'm sorry?

[Scott Clements]

Most of the companies are unionized.

[David McGuinty, Liberal, Ottawa South, ON]

Right! So unionized companies are bidding on an open bidding system and they're winning those contracts fair and square.

[Scott Clements]

Yes.

[David McGuinty, Liberal, Ottawa South, ON]

They're performing the work as required under the contract, and that's all working quite well.

[Scott Clements]

The challenge in Fort McMurray is not winning contracts. It's finding the workers to execute them.

[David McGuinty, Liberal, Ottawa South, ON]

The human capacity problem is the big one you're facing. Is that driving up costs?

[Scott Clements]

Oh, yes.

[David McGuinty, Liberal, Ottawa South, ON]

How is it driving up costs?

[Scott Clements]

An indicator of growth is—

[David McGuinty, Liberal, Ottawa South, ON]

I want to get it on the record for my colleague, Mr. Adler.

[Scott Clements]

As for folks coming through the airport, we grew by 25% last year, and we're at 30% so far this year. That's unheard of. The average in Canada is 4%. Those are workers flying in and out, and there are more coming. So, yes, when that kind of heat starts to take place, the competition starts between companies, robbing from each other.

[David McGuinty, Liberal, Ottawa South, ON]

So on the question of value for money, using public dollars, the question of human capacity to perform the contracts has to be examined at the same time as we look at the question of open or closed bidding systems.

[Scott Clements]

Yes, absolutely.

[David McGuinty, Liberal, Ottawa South, ON]

You're telling me that they both have the potential to have a profound effect on costs.

[Scott Clements]

It goes back to the reference to the mayor. The fact that we have to bring these people in from all over North America is highly problematic. If more people lived in Fort McMurray, in a supply-and-demand housing situation that was more normal, a lot of these problems would go away.