April 15, 2014

AHS spent $1 billion in sole-source contracts

EDMONTON, AB (April 15, 2014): Alberta Health Services doled out nearly $1 billion in untendered contracts over a two year period, the Wildrose Official Opposition revealed today. According to documents obtained through Freedom of Information and Protection of Privacy (FOIP) legislation...

AHS sole-sourced 1,275 contracts worth just over $990 million between January 2011 and January 2013. Last week, Wildrose revealed documents obtained through FOIP that showed AHS spent $250 million on outside consultants over an 18-month period. Although there is some overlap between the two FOIPed documents, together they show AHS has spent nearly $1.25 billion on items and services – many of them low priority – through highly questionable contracting practices. “Alberta Health Services is clearly out of control,” Wildrose Health Critic Heather Forsyth said. “First, we find out they spent $250 million on consultants over 18 months. Now, we find out they’ve spent nearly a billion dollars without even attempting to get the best deal for taxpayers. It’s no wonder we can’t seem to make progress on reducing wait times when this much money is spent so carelessly. Who knows how much money we could have saved and redirected to the front lines?” Internal AHS policy stipulates that all contracts for goods and services valued at $75,000 or more must go out to tender and cannot be sole-sourced without company approval. Of the 1,275 sole sourced contracts, 503 exceeded the $75,000-threshold. Those contracts account for $973,549,568, or 98% of the total. Most of the contracts are for routine goods and services such as snow removal, food services, public awareness programs and a range of professional health care services such as continuing care. However, Forsyth says that since it was all sole-sourced, there’s no way to know if that money was spent in the most efficient way possible. “This is a staggering amount of money to spend without knowing whether or not taxpayers got the best deal,” Forsyth said. “I’d like to know how so many contracts were exempted from the sole-source policy and how nearly $1 billion was spent without bothering to ask for lower bids. It’s just another example of how little regard AHS has for precious tax dollars.” The 1,275 contracts do contain several examples of wasteful and unnecessary expenditures. Nearly $800,000 was spent on untendered executive coaching contracts, over $800,000 on recruitment, and nearly $80,000 on public opinion polling.  In 2012, AHS even awarded a sole-sourced contract to a firm called Berkeley Research to review its sole-sourcing policy (page 12). Other examples include marriage counseling (page 2), yoga (page 24), paper shredding (page 43), and a fitness instructor (page 47). 

AHS Sole Source


“Albertans are tired of this kind of waste in AHS and they’re tired of a government that won’t do anything about it,” Forsyth said. “It’s way past time for Health Minister Fred Horne to step up, show some leadership, and get to the bottom of what has gone so wrong at AHS that has allowed this much money to be spent so irresponsibly.”


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