In the final innings of last week’s budget debate, there was a brief, and predictable, skirmish over a $3 million outlay for “consultants” who will be hired to advise the city on how to contain costs for the Armageddon-like 2012 budget.
“Why are we spending $3 million to second-guess our budget chief?” wondered Councillor Gord Perks in his speech to council. In an interview with CTV, deputy mayor Doug Holyday said the funds will be “well spent” because the consultants will help find cost efficiencies and identify ways to deliver municipal services with fewer staff.
As it happens, the city issued a request for expressions of interest (REOI) back on February 11, and the response period ends Wednesday. Some highlights:
“Management Consultants sought for the Roster include those firms/individuals capable of undertaking complex and often high-profile and/or politically sensitive matters. Assignments will involve issue analysis, identifying optional courses of action to attain improvement or resolution, and recommending solutions and implementation actions [emphasis added].”
The city manager, the document continues, will likely be looking for the following sorts of advice: “Program and Mandate Reviews; Organizational Restructuring; Operational Efficiency Reviews; Business Process Reviews; Productivity and Workflow Analysis; Performance Audits and Reviews; Performance Measurement and Benchmarking; Financial Analysis/Cost-benefit Analysis; Policy Analysis and Advice; and Public Sector Governance.”
As for “deliverables,” the REOI notes that the city manager’s office “may request the Consultant to support their role as the lead responsible for undertaking briefings and relationship management with senior parties including the: Mayor, members of City Council and Committees of Council; Boards of Directors or Executives of organizations in which the City has an interest; City Manager and Deputy City Managers; City divisional and special purpose body staff; and Labour unions and professional associations.”
One doesn’t need to be especially deft at reading government documents to see that the consultants, rather than looking to save a bit of cash on office supplies, will be preparing work-ups on how to outsource city services, as per the political directive of the mayors Ford.
These assessments, moreover, will include detailed, and highly valuable, financial analyses. In other words, the as-yet unnamed consultants will know which potentially privatized operations are likely to fetch the most attractive bids, and what sorts of margins private sector partners might expect to generate.
When the council finally unveils the RFPs for waste management, the financial analysis included in these documents will have been done by the city’s senior waste management officials. They actively monitor their department’s performance relative to other municipalities, as well as private haulers.
It’s a different story for many other municipal services that soon may be teed up for outsourcing. The external consultants will be doing all sorts of due diligence for the first time, ostensibly for the consumption of council and the city manager. But the reality is that these firms, especially the large accounting partnerships [PDF] that tout their expertise in the Triple P world, also have scores of private clients, some of whom may be looking to bid on the services the Fords have pledged to privatize.
A potential for conflicts of interest? You bet.
For the waste management outsourcing process that will play out this year, council, in all likelihood, will employ a fairness commissioner to monitor the tendering process and ensure that bidders stay away from city officials and councillors during crucial moments in the decision-making process.
But how will the city prevent these yet-to-be-selected external consultants from tipping off business clients who may be vying to bid on the municipal services that council ultimately plans to outsource?
The REOI is silent on this point.
In theory, the consultants should be required, at a minimum, to not disseminate the information they gather while they’ve got access to the city’s books and officials. In practice, it could be very tough to police that sort of thing.
The last time these questions arose was during the Bellamy inquiry into the MFP computer leasing scandal of the early 2000s, when city officials, Tory lobbyists and the company’s executives conspired to drive up the price of an outsourced IT contract. Madame Justice Denise Bellamy proposed a range of reforms to the city’s purchasing policies, as well as the establishment of an integrity commissioner.
Lest anyone’s forgotten, Bellamy had several recommendations for the conduct of consultants, including the importance of disclosing “potential conflicts” and the need to “refrain from divulging confidential information” (Rec. 60.g).
For the record, the city’s current integrity commissioner Janet Leiper last summer ruled that the current mayor improperly used his office to solicit donations for his football foundation from “lobbyists, clients of lobbyists and a corporation which does business with the City of Toronto.”
The question now is whether council will ask her, or any other independent official (e.g., auditor general Jeff Griffiths), to monitor the extensive outsourcing process that likely will begin with the hiring of the external consultants.