Sask. spending millions on companies that bid on work and lose
$5.6M paid to unsuccessful bidders of P3 projects in 2015-16
Saskatchewan's Opposition is questioning why the government is spending millions of dollars on companies that bid on government work and lose.
The government spent a total of $5.6 million in honoraria to unsuccessful bidders in 2015-16.
It says the payments to companies that unsuccessfully bid on a public-private partnership (P3), such as the Regina bypass or new schools, is standard practice.
"My suspicion is if we didn't pay an honorarium, we wouldn't get people to bid," said Gord Wyant, minister responsible for SaskBuilds, which oversees the government's P3 projects.
The NDP's Cathy Sproule questions the need, given the recipients of the money.
"They are very, very large multinational companies that are making these bids," she said. "Presumably if they're in the P3 world they should have the ability and the wherewithal to make these bids without getting these [payments]."
Wyant said the companies put a significant amount of work into their bids and receive about 30 per cent of the cost of their designs back as an honorarium.
The government keeps the work, which Wyant said has significant value.
"There's lots of innovation in those bids and some of that information can be used in future contracts," he said.
Wyant said the honoraria are included in the government's cost-benefit analysis of P3s and the public-private partnerships are still cheaper than traditional government projects.