QUESTIONING MUNICIPAL SELF-PERFORMANCE
This question speaks to some fundamental issues about the mandate and role of municipal governments
in Canada. Is it government’s place to deliver services that can be performed cost-effectively
by the private sector? Is it appropriate for governments to compete against taxpaying private contractors
to perform construction work? In Canada, a sophisticated and efficient system of public
tendering is based on the traditional understanding that it is not within government’s purview to
perform work or provide services that are more appropriately delivered by the private sector.
Is the work awarded
through a public
What is the impact from
local businesses and
A major consideration in the decision to self-perform construction work should be the impact
such a decision will have on local residents and businesses. While self-performance may
create new jobs within the civil service, each new public sector job will displace a worker employed
by local contractors. In many cases where local municipalities are primary customers,
contracting firms will fail if that work is no longer available to them. By extension, other local
businesses from which contractors buy their materials and services will also suffer from the
loss of business from their major customers.
A close look at the economies of many Canadian municipalities will show that local civil
contractors invest heavily in the economic development and prosperity of their communities.
Many are active in local residential and commercial development, others in establishing other
local businesses. The money earned by the contractor stays in the community and generates
economic benefit locally. Contractors also generate considerable tax income for all levels
of government. As well, in their local economies they generally need significant operational
space, generating much higher rates of municipal property tax.
10 Think BIG | Quarter 3 2019 | saskheavy.ca