City boosting oversight of consulting contracts
Audit finds repeated examples of problems
THE CITY is ramping up oversight of the use of consultants and vowing to seek more in-house expertise following a scathing audit of past spending on outside experts. Councillors got their first glimpse Wednesday at a management response to the April audit that looked at 32 consulting contracts over three years. It found repeated examples of cost overruns, missing business cases and even examples of reports that were paid for — but never used.
At the same meeting, councillors also debated the use of sole-sourced consultants among themselves and weighed in on the findings of a separate audit of spiralling consulting costs for a City Housing Hamilton parking lot.
“I think there is a heightened awareness about the issue, which is good,” said Mountain Coun. Donna Skelly, who asked for the City Housing project audit and also raised the issue of area rating infrastructure cash used to pay for a consultant in other wards.
“But until I see evidence that (staff recommendations) are having the desired effect, I can’t say I’m comfortable we’ve got it under control.”
City manager Chris Murray was slated to talk about a report on what staff are doing to address the auditor’s findings Wednesday, but councillors asked to put off the presentation to give themselves time to read up.
That report, available online, outlines a list of ongoing improvements,
including: Electronic tracking of consultant performance to better allow the city to evaluate or even ban prospective companies; Clearer rules and reporting on how budget surpluses from one project are transferred to cover shortfalls in others; Focusing more effort on evaluating in-house employee skills to help avoid unnecessary contracting out of jobs; Creating project business case templates that can be used across all city departments.
Many of these changes have been in the works for a while, said Murray. He stressed the city has been overhauling its procurement, corporate governance and budgeting strategies incrementally for several years. “It’s not like we are just waking up to these matters. In fact, many of these issues we previously identified and have been working on for some time.”
On Wednesday, some councillors also questioned the use of area rating infrastructure cash to pay for a consulting co-ordinator for “participatory budget” meetings in wards 1 and 2.
In those wards, the councillors pay CivicPlan to organize and host consultation meetings as well as resident votes on how to use the annual $1.6 million allocated to each old city ward for infrastructure.
Procurement staff said the $88,000 amount spent over 15 months by Ward 1 Coun. Aidan Johnson on the sole-sourced contract was “non-compliant” with city policies because amounts over $10,000 require either competitive bids or a request for a policy exception.
Councillors Skelly and Lloyd Ferguson asked why any area rating money would be spent on consultants, rather than infrastructure. Skelly requested a report back from staff on the procurement ins-andouts of the issue.
Johnson said he “inherited” the participatory budgeting process from former councillor Brian McHattie and added he consulted city staff on the rules. He said he wanted to stick with CivicPlan as a meeting co-ordinator because of their “tremendous work.”
“Until today, I was confident I was following all the rules as I understood them,” he said, later adding “I think we would all benefit from some clarity on (area rating) rules.”