Statement from Minister Clarke on the Office of the Auditor General of Canada’s performance audit of Government of Yukon procurement and contracting

Minister of Highways and Public Works Nils Clarke has issued the following statement:

“Today, the Office of the Auditor General of Canada – OAG – released its performance audit report on Government of Yukon procurement and contracting. The audit reviewed a representative sample of 53 contracts worth approximately $50,000 or less, selected from over 47,000 contracts across all Government of Yukon departments, as well as 10 high-value contracts worth $250,000 or more. These contracts were awarded and completed between April 1, 2019, and October 31, 2023.

“Procurement plays a vital role in fostering local economic growth and supporting Yukoners. Over recent years, we have taken important steps to modernize procurement and make it more inclusive. Recent initiatives, including the 2019 introduction of the new procurement policy and the 2020 launch of the Yukon bids and tenders platform, have made it easier for businesses to participate in procurement, advanced economic reconciliation and strengthened the territory’s economy through the support of local businesses.

“While we appreciate the OAG’s insights and welcome and accept all of the recommendations in their report, it is important to note that the report reveals documentation issues, not flaws in the procurement process itself.

“For example, the audit report used five metrics to assess whether the Government of Yukon demonstrated value for money during procurement. In each of the audited contracts, this was achieved for four of the five metrics, with the OAG finding that for half of the sampled contracts, there was no documentation demonstrating that market research was conducted prior to the awarding of the contract. While improving documentation is an area of improvement that we intend to pursue, limited or no competition across markets can also reflect the reality of doing business in a remote or rural jurisdiction.

“Additionally, the OAG found that the dollar amount spent on all of the reviewed contracts was lower than the value of contracts themselves, in both low and high dollar value contracts.

“Yukoners trust the territorial government to spend public money responsibly and act in Yukoners’ best interests. While there is work to be done to improve internal documentation processes, I also wish to highlight the following findings in the OAG’s report:

• over 80 per cent of contracts under $50,000 awarded during the audit period went to Yukon businesses, an achievement that benefits smaller jurisdictions like ours;
• all reviewed contracts effectively met the needs they were designed to address, demonstrating the important role procurement places in delivering essential public services and programs to Yukoners;
• in all reviewed contracts, deliverables met the stated need of the contract and the goods and services contracted were received; and
• no instances of fraud or conflicts of interest were found in the OAG’s review.

“In response to the audit’s findings, we have further strengthened our procedures by introducing mandatory conflict of interest disclosures for every procurement file. We also recently improved our procurement processes to further address and prevent conflicts of interest, and now require the disclosure of any conflicts of interest on more than just the open, value-driven procurements. Additionally, the Corporate Conflict of Interest Policy sets clear guidelines to minimize potential conflicts and the Internal Conflict of Interest Policy mandates the disclosure of any real or perceived conflicts.

“We recognize that improvements are needed, particularly in documentation practices, and we are addressing these with the urgency required. The first step will be to develop an action plan, which will:

• strengthen internal guidance to clarify processes and resources to better document procurement so we can more clearly demonstrate value for money moving forward;
• introduce new reporting measures within the Yukon government to limit potential conflicts of interest; and
• continue to improve regular data collection, monitoring and reporting practices to evaluate outcomes and respond to emerging trends.

“As we develop the action plan, we will engage with industry and Yukon First Nations partners to make sure changes to our processes reflect the needs and interests of all Yukoners.

“To complement these efforts, we will also conduct an independent and comprehensive review of the procurement policy in 2025. Together, these initiatives will continue to improve our procurement processes and ensure they remain transparent, consistent and aligned with best practices.

“Procurement is a critical tool for delivering essential services and programs that benefit Yukoners. While there is more to be done, the progress made so far demonstrates our commitment to creating economic opportunities and supporting businesses and communities across the territory. By acting on the audit’s recommendations, we will continue building a strong and inclusive future for all Yukoners.”