Sand Audit is Disappointing and Disturbing
Earlier today, an audit was released by the City Auditor’s Office that examined the City of Edmonton’s Winter Street Sand Recycling and Mixing Program. In this report, which will be discussed at next Thursday’s Audit Committee meeting, it was found that from 2005 to 2015 the City of Edmonton did not receive full value-for-money in its $37 million investment, and the intended outcomes of the program were far from achieved.
To say that I am disappointed in the results of this audit is an understatement.
This disappointment is not only due to the fact that the City’s investment - your money - did not receive full value, but also because this revelation comes in the wake of all of the efforts that this Council in particular, as well as our Corporate Leadership Team, have made in the last year to ensure that the proper oversight and attention is being given to all areas where project and contractor oversight is needed. While this program began and failed under the watch of a previous City Manager and Council, it is the job of this Council and this City Manager to make sure this kind of bad management does not happen going forward.
So what happened and why it shouldn't happen again
This failed program was defined by 2 five year contracts, one beginning in 2005 and another beginning in 2010. Clearly lack of oversight was the issue. It's inexcusable and the people responsible, we are told are retired, but should have faced serious consequences before they left on their own.
But here is how the City of Edmonton has taken action to improve its contract management:
New leadership in our City Operations department signalled in 2014 this contract would not be renewed.
The City’s Corporate Leadership Team approved a contract management authority framework for the city which assigned responsibility for the establishment and maintenance of corporate contract management policies and procedures, training, compliance monitoring and reporting to the Corporate Procurement and Supply Services Branch within the Financial and Corporate Services Department.
Developed a risk-based contract management control framework which identifies risks and corresponding controls and mitigation strategies throughout the contract management process (from contract creation to contract close-out) based on gaps and issues identified in audits, and in alignment with industry best practices. This framework forms the basis for a corporate contract management administrative directive which will outline roles, responsibilities and expectations for City management and staff involved in contract management activities (will be implemented by December 31, 2016).
Delivered interim contract management training to 200 City staff responsible for managing contracts in May/June 2016.
Issued a Scope of Work and Contract Management guidance document to Corporate Leadership Team, Branch Managers and Directors. This document outlined clear management expectations related to contract creation, monitoring and contract/supplier performance management to ensure value for money and responsible stewardship.
Developed a training program framework to guide the development of a comprehensive training program for procurement and contract management within the City of Edmonton’s School of Business. This training program will include certification requirements.
Conducted contract management maturity assessments across all City Departments and consulted with a diverse set of City staff to understand strengths, challenges and opportunities with respect to contract management practices at the City of Edmonton.
Developed an on-line Procurement Reference guide and resource toolbox for City staff which includes guidance for the effective management of contracts.
We need to continuously be asking ourselves where we can improve, how can we be more efficient, and how can we serve the citizens of Edmonton better. But even more important is ensuring we have a culture of transparency, good management and accountability. We need to ensure that all areas of business that the City is involved in, are scrutinized and given the proper oversight.
When practices and procedures are being conducted in a way that is inefficient and is losing money, they need to be addressed immediately. Employees who are not performing as they should be need their performance corrected, or they should be removed from their positions.
It is up to this City Council, as well as our Corporate Leadership Team, to ensure that the proper oversight is being given at all levels, and at all times, to guard against this from happening in the future; I am confident that going forward, given that the programs which are outlined above have been implemented, that a failure such as the one highlighted in this audit, will not occur again.
That being said, I am glad that the deficiencies in the Winter Street Recycling and Mixing Program were uncovered and brought to light. This program was intended to save the City money and to help the City work towards becoming more environmentally sustainable; it has the potential to do just that. On Thursday at Audit committee all we can do is right this problem.