The Canadian Taxpayers Federation (CTF) released  documents obtained through a Freedom Of Information and Protection of Privacy (FOIPOP) request that shows procurement rules were broken and Nova Scotia Business Inc (NSBI) spent hundreds of thousands of dollars on the Ships Start Here campaign with little to nothing to show for it.

Background

There have been concerns about the effectiveness of the Ships Start Here campaign since the very start. When the RFP process was launched for the ships bid by the Federal government, Prime Minister Stephen Harper told companies not to lobby the government and that the best shipyard would be chosen on merit alone.

After the $25 billion ships contract was awarded to Irving Shipyards, Nova Scotia’s Federal Cabinet Minister Peter MacKay said that the province’s $620,000 spent on Ships Start Here was a waste of money and had “no impact on the final decision.”

The total Ships Start Here campaign cost $1.4 million. The Nova Scotia government contributed $620,000, broken up in two parts. First, Communications Nova Scotia spent $317,000 to purchase, produce and create the ads in the Maritimes. Second, NSBI spent another $303,000, this memo examines the value taxpayers got for that money.

Given the large amount of money spent, it is difficult to understand how the significant expense was ever justified.  Why did the government pay MT&L Public Relations nearly $620,000 in an untendered contract? And specifically what exactly did NSBI get for its $303,000?

Note: this examination focuses just on the NSBI portion of the Ships Start Here campaign.

For a more broad overview of total expeditures by Nova Scotia Government for Ships Start Here campaign see CTF’s FOIPOP from Aug 2011 HERE.

No Accountability

The invoices from MT&L Public Relations show that money was billed to the government with little to no corresponding particulars detailing what the firm actually did for that money.

For example, on July 20, 2011, MT&L Public Relations billed taxpayers  $92,340.20 for what it describes simply as “professional fees.” (You can find the invoice HERE) There is no breakdown of costs incurred or how many hours MT&L staff spent working on the project or what tangible results taxpayers saw for that money. .

Of the total $303,000 MT&L Public Relations charged NSBI, $240,000 was attributed to this broad category of “professional fees” that defies scrutiny.  There is no written record of the company being asked to provide further details (like meeting minutes or a written request) – the bills appear to have been paid without question.

Timeline – NSBI Failed to follow procurement rules

Under rule 3(b) of the Province of Nova Scotia Administrative Directive, “all new contract and contract renewals valued at $100,000 or more that did not go through the RFP process must be approved by Treasury Board prior to awarding the contract”.

The documents clearly show that NSBI staff gave an untendered contract to MT&L Public Relations with no written contract detailing the scope of work or projected costs – two requirements intended to safeguard the public. It was only after sinking almost $144,000 into the project and 3 months later that NSBI applied to Treasury Board to bypass the RFP process – a process that is required to be undertaken prior to the awarding of untendered contracts.

Eight months went by before a record supporting the decision to proceed outside of the RFP process was created within NSBI.  It’s difficult to imagine what legitimate business purpose this document might serve NSBI given that the decision had been made and acted upon long before.  Given that the CTF’s FOIPOP request immediately preceded the documentation, it appears to have been done in anticipation of public scrutiny in a self-serving attempt to justify past conduct.

Here is a brief timeline:

Week of April 6th: NSBI begins work with MT&L Public Relations

May 2011: NSBI was billed four times on May 31^st, 2011 for a total of $104,763.16. Invoices indicate that bills were for: Comm counsel/Project Mngmnt ($35,404.06), Regional Campaign Development ($13,971,28), website ($41,171.25), Collateral Development ($14,216.57). You can find the invoices HERE

June 2011: Work continued and on June 30^th NSBI received another 3 bills totaling $39,151.75. You can find the invoices HERE

June 24^th, 2011: NSBI filed a professional services approval with Treasury Board to give NSBI the power to hire MT&L Public Relations without an RFP,almost three months after work had begun. There is nothing in the package of documents provided in response to the FOIPOP to indicate when Treasury Board approved NSBI’s request. Documentation showing the date NSBI wrote to Treasury Board can be found on the last page of the non-RFP approval HERE

July –Sept, 2011: NSBI incurred another $62,106.63 in total bills. You can find the invoices HERE

Dec 14^th, 2011: CTF makes FOIPOP request to NSBI for documents pertaining to procurement of the Ships Start Here campaign.

Jan 30^th, 2012: Documentation from Vice President of NSBI to President & CEO of NSBI indicating the decision to use alternative procurement policy for Ships Start Here. Memo can be found HERE

Conclusion

Not only did the government enter into the Ships Start Here campaign against the advice of the Prime Minister who warned it would be irrelevant to the decision, but NSBI did so contrary to the rules in place to protect the public and in a fashion that permits very little scrutiny of the payments made.

In the end, the only products produced by MT&L Public Relations for NSBI were a few lawn signs, a website, stickers, window clings and banners. And for that, taxpayers spent $303,000. Our success in the end must be credited to Irving Shipyard for making a better overall bid than its other two competitors.

The NS government has said repeatedly that the Ships Start Here campaign was necessary for Halifax to win the $25 billion ships contract. But there is no evidence this is true, in fact, according to Peter MacKay, this campaign had a negative impact.

The only people who seem to have benefitted from the Ships Start Here campaign is MT&L Public Relations who billed hundreds of thousands of dollars, and we the taxpayers may never know what for.

Other Notes:

-       MT&L charged the government $89.00 (May 31, 2011, Comm Counsel/Project Mngmnt) to produce a poster showing the timeline and deadlines government and MT&L would have to follow to complete the project. Invoice can be found HERE

-       MT&L also charged taxpayers with $159.56 in taxi fees, even though the distance from MT&L Halifax office to NSBI is just 290m.

-       Premier Darrell Dexter’s office was part of the Ships Start Here discussions: on June 14^th, 2011 Dan O’Connor (Chief of Staff), Matt Hebb (Principal Assistant) and Paul Black (Policy, Executive Council) were all consulted and asked for input on the communications for the campaign.  Email can be found HERE

-       NSBI paid $4,181.67 to produce Ships Start Here banners (and prototypes), lawn signs and stickers. The professional fees paid on top of production was $7,717.50, almost double the total costs of the products themselves. (May 31^st, 2011 bills).

-       MT&L Public Relations has very close connections to NS government. Lisa Bugden Vice President of NSBI who approved alternative procurement for Ships Start Here is a former MT&L Principal. Also Paul Black (Policy Director, Executive Council) who was consulted on the strategy Ships Start Here campaign was also a principal at MT&L Public Relations.

-       Typically firms like MT&L Public Relations charge anywhere from $90-$250 an hour for their services.

-       MT&L Public Relations made sure not to leave any money on the table, they billed almost exact budget of the government of $300,000, an amazing coincidence since most of the budget was spent on professional fees.