FAQs: The Broader Public Sector Accountability Act (BPSAA of 2010) and RFPs

Q:  If RFP’s are used to procure other government goods and services, why doesn’t it work for school bussing?

A:  When school bus routes are tendered, the first round of bidding is characterized by predatory and panic pricing.  Independent contractors are put out of business, and competition is reduced.  With less competition, rates go up as monopoly providers begin to dictate contract terms and conditions.  By that point it is too late for the small independents as they no longer exist.  In all jurisdictions where tendering has been implemented, it has resulted in double-digit increases in school transportation budgets in less than 10 years of implementation.

Q:  Don’t all government purchases have to be put out to tender?

A:  No.  The Broader Public Sector Accountability Act (BPSAA of 2010) requires all government contracts to be competitively procured, but this does not mean they have to go out by Requests For Proposals, which is the method that is specifically concerning to ISBOA members.  The BPSAA requires agencies to do local market assessments and to assess the appropriate procurement method.  There is now evidence that the Ministry of Education directed school boards and consortia to go to RFP, even when they did not feel this was the most appropriate method of procurement.

Q:  Why is the current process of contracting better for school boards?

A:  The current method – of local bus operators negotiating rates with transportation consortia – is a collaborative model which allows school boards to live within their funding envelope.  Already consortia that have gone to RFP are finding they are in a deficit position for transportation.   The rush to RFP is in response to the E-Health and OLG scandals, and ignores the unique considerations of the school bus business, especially in rural Ontario.

Q:  What is the greatest risk?

A:  Driver wages are already depressed when compared with other transportation sector jobs.  School bus operators are fighting to attract, retain, and reward qualified drivers.  This RFP process forces school bus operators to reduce rates on the backs of drivers.  Statistics show that there is a greater incidence of injury of young students amongst new hires, so an increasing level of turnover of drivers will risk student safety.

Q:  How safe are school bus operators now?

A:  School bus transportation is 16x safer than any other mode of transport.  With the RFP process rewarding only the lowest bidder, the school bus industry’s enviable safety record is at risk.  We do not want to be debating the failures of this policy at a Coronor’s Inquest, where the evidence will be that the government knowingly depressed rates below the point of funding safety.

Q:  Why can’t existing school bus contractors successfully compete for their own routes?

A:  RFPs are an artificial form of competition and have been proven to favour large companies that can afford to underbid in the first round in an effort to eliminate competition in the market.  Small family owned businesses are not prepared to win contracts on the backs of their employees.  Additionally, the pilot projects have shown that the tendering documents are overly complicated and cumbersome.  The evaluation criteria were unknown and vague.  The outcomes of the RFP’s were inconsistent, again suggesting that the process actually reduced the transparency and accountability that already exists in school bus contracting.