2001 Purchasing Activity Report
Introduction 
Each year the Government publishes, on the Internet, statistics on purchases and contracts conducted in departments and agencies. The annual Purchasing Activity Report is used to provide statistical analysis of the processes and tools through which government contracting is conducted.
In reviewing the statistics it must be kept in mind that the federal Government’s Contracting Policy objective is to acquire goods and services and to carry out construction in a manner that enhances access, competition and fairness and results in best value or, if appropriate, the optimal balance of overall benefits to the Crown and the Canadian people.
As well, contracting is to be conducted in a manner that will: 
−	Stand the test of public scrutiny in matters of prudence, probity, facilitate access, encourage competition and reflect fairness in the spending of public funds; 
−	Ensure the pre-eminence of operational requirements;
−	Support long-term industrial and regional development and other appropriate national objectives;
−	Comply with the government’s obligations under the North American Free Trade Agreement, the World Trade Organization – Agreement on Government Procurement, the Agreement on Internal Trade. 
The Government is committed to working on strengthening and modernising government procurement. Procurement reform is guided by modern comptrollership and founded in Results for Canadians: A Management Framework for the Government of Canada. This framework sets a clear direction for renewing government management based on: citizen focus, values, results and responsible spending. Procurement reform supports the Government’s Speech from the Throne commitments and to promote business practices that will build a dynamic economy. 
The procurement reform initiative centres on: 
−	Strengthening the government’s policy framework;
−	Renewing our human resources in the procurement and materiel community; and 
−	Modernising our procurement practices and process. 
The Government is also committed to ensuring that Canadians are provided with appropriate information on activities in a cost-effective, efficient and transparent manner. 
Suppliers who wish to find out more about federal government bidding opportunities should consult MERX at http://www.merx.cebra.com/. Those who wish to find out more about how the Government of Canada buys should contact Contracts Canada at http://www.contractscanada.gc.ca/.

2001 Purchasing Activity Report - Summary	
Departments and Agencies subject to Government Contracts Regulations	
Total Number and Value of Contracts including Net Amendments	
Contract	Solicitation Procedure	Number	% of Total	Value	% of Total	
Type	 	 	Number	$ 000	Value	
 	Contracts below $25,000, including amendments 	 328,921 	 	 509,173 	 	
 	Electronic bidding (Note 2.3 & 5)	 3,341 	 	 1,722,479 	 	
 	Traditional competitive (Note 2.3 & 5)	 1,855 	 	 661,492 	 	
 	ACANs (Note 2.3 & 5)	 2,021 	 	 1,303,347 	 	
 	Competitive awards (Note 2.3)	 7,217 	 	 3,687,318 	 	
 	Net amendments	 - 	 	447,893	 	
Goods	Competitive including amendments	 7,217 	91.5%	 4,135,211 	74.2%	
 	Non-competitive awards (Note 2.3)	 670 	 	 1,262,194 	 	
 	Net amendments	 - 	 	 172,188 	 	
 	Non-Competitive including amendments	 670 	8.5%	 1,434,382 	25.8%	
 	Subtotal Contracts $25,000 and above	 7,887 	100.0%	 5,569,593 	100.0%	
 	Total of All Goods Contracts	 336,808 	 	 6,078,766 	 	
 	Proportion of All Contracts	 	62.5%	 	46.2%	
 	Contracts below $25,000, including amendments 	 179,710 	 	 755,413 	 	
 	Electronic bidding	 3,955 	 	 1,855,363 	 	
 	Traditional competitive	 4,082 	 	 746,020 	 	
 	ACANs	 1,560 	 	 421,147 	 	
 	Competitive awards	 9,597 	 	 3,022,530 	 	
 	Net amendments	 - 	 	 1,851,550 	 	
Services	Competitive including amendments	 9,597 	77.7%	 4,874,080 	86.6%	
 	Non-competitive awards	 2,755 	 	 557,852 	 	
 	Net amendments	 - 	 	 193,175 	 	
 	Non-Competitive including amendments	 2,755 	22.3%	 751,027 	13.4%	
 	Subtotal Contracts $25,000 and above	 12,352 	100.0%	 5,625,107 	100.0%	
 	Total of All Service Contracts	 192,062 	 	 6,380,520 	 	
 	Proportion of All Contracts	 	35.6%	 	48.5%	
 	Contracts below $25,000, including amendments 	 8,220 	 	 37,325 	 	
 	Electronic bidding	 1,157 	 	 539,195 	 	
 	Traditional competitive	 571 	 	 41,160 	 	
 	ACANs	 64 	 	 10,560 	 	
 	Competitive awards	 1,792 	 	 590,915 	 	
 	Net amendments	 - 	 	 47,708 	 	
Construction	Competitive including amendments	 1,792 	92.1%	 638,623 	98.2%	
 	Non-competitive awards	 154 	 	 10,733 	 	
 	Net amendments	 - 	 	 797 	 	
 	Non-Competitive including amendments	 154 	7.9%	 11,530 	1.8%	
 	Subtotal Contracts $25,000 and above	 1,946 	100.0%	 650,153 	100.0%	
 	Total of All Construction Contracts	 10,166 	 	 687,478 	 	
 	Proportion of All Contracts	 	1.9%	 	5.2%	
 	Contracts below $25,000, including amendments 	 516,851 	 	 1,301,911 	 	
 	Electronic bidding	 8,453 	 	 4,117,037 	 	
 	Traditional competitive	 6,508 	 	 1,448,672 	 	
All	ACANs	 3,645 	 	 1,735,054 	 	
 	Competitive awards	 18,606 	 	 7,300,763 	 	
 	Net amendments	 - 	 	 2,347,151 	 	
 	Competitive including amendments	 18,606 	83.9%	 9,647,914 	81.5%	
Contracts	Non-competitive awards	 3,579 	 	 1,830,779 	 	
 	Net amendments	 - 	 	 366,160 	 	
 	Non-Competitive including amendments	 3,579 	16.1%	 2,196,939 	18.5%	
 	Subtotal Contracts $25,000 and above	 22,185 	 	 11,844,853 	 	
						
	Total Contract Awards including Net					
	Amendments	539,036	100.0%	13,146,764	100.0%	
						
	Variance	-20	-0.004%	-627	-0.005%	

	Adjusted Total Awards including Net 					
	Amendments	539,016		13,146,137		

Notes to 2001 Purchasing Activity Report
1.	Objective
The objective of the annual Purchasing Activity Report and its preliminary version is to provide a basic snapshot of purchasing activities of the Government of Canada. It is based on the Government of Canada’s policy framework in effect in 2001. It is important to note that there is no statutory requirement for such a report. It complements information found on contract statistics on Contracts Canada web site found at http://www.contractscanada.gc.ca/. Further information on contracting and contracting activities may be found for major purchasing departments in the Government’s public and Parliamentary reporting documents, specifically their Annual Report on Plans and Priorities and Departmental Performance Reports. Internal departmental audits on the contracting function are posted on http://www.tbs-sct.gc.ca/rma/database/access/dflexp.asp?id=1165&lang=E.
Information on the Procurement Strategy for Aboriginal Business can be found at the Department of Indian Affairs and Northern Development web site http://asi-rfa.inac.gc.ca/Common/MainPage.asp.
The Purchasing Activity Report was derived from data provided by the reporting entities specified below. Since the data is not audited, no warranty or other legal assurance as to the truth, accuracy or completeness of any of this information is stated or can be implied. Any person making use of this information for any purpose whatsoever does so entirely at his/her own risk, and the Crown shall have no liability whatsoever. This report covers government purchasing activities for the period January to December 2001 inclusive. 
2.	Procurement Policy Framework
The main features of the Government of Canada’s procurement policy framework in effect in 2001 that are relevant to the Preliminary Purchasing Activity Report are as follows:
2.1	The objective of government procurement contracting is to acquire goods and services and to carry out construction in a manner that enhances access, competition and fairness and results in best value or, if appropriate, the optimal balance of overall benefits to the Crown and the Canadian people.
2.2	Government contracting shall be conducted in a manner that will:
(a) stand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds;
(b) ensure the pre-eminence of operational requirements;
(c) support long-term industrial and regional development and other appropriate national objectives, including aboriginal economic development;
(d) comply with the government’s obligations under the North American Free Trade Agreement, the World Trade Organization – Agreement on Government Procurement and the Agreement on Internal Trade.
2.3	Appendix A of the Treasury Board Contracting Policy defines a competitive contract as a contract where the process used for the solicitation of bids enhances access, competition and fairness and assures that a reasonable and representative number of suppliers are given an opportunity to bid by: 
EITHER
(A)	giving public notice, using electronic bidding methodology, possibly supplemented by traditional bidding procedures, of a call for bids for a proposed contract or of an intention to award a contract to a pre-selected contractor (a directed contract advertised by an Advance Contract Award Notice – ACAN), in accordance with limited tendering reasons set out in international trade agreements, or in accordance with non-competitive tendering reasons set out in sections 506(11) and 506(12) of the Agreement on Internal Trade, or in accordance with non-competitive tendering reasons set out in section 6 (excluding section 6.1) of the Government Contracts Regulations (GCRs)
and where
1.	in the case of a call for bids, the lowest bid or the bid that offered the best value, as set out in the evaluation criteria in the bid solicitation and as determined by the contracting authority, was accepted; 
2. 	in the case of a call for bids where only one bid, compliant with mandatory criteria set out in the bid solicitation was received, fair value to the Crown, as determined by the contracting authority, was obtained; or
3.	in the case of an ACAN, no valid indications of interest or valid challenges to the proposed award were received within the prescribed period of no less than 15 calendar days.
OR
(B)	giving public notice, using traditional bidding procedures (such as a suppliers’ list, etc.) and in a manner that is consistent with generally accepted trade practices, of a call for bids for a proposed contract,
and where
1.	in the case of a call for bids, the lowest bid or the bid that offered best value, as set out in the evaluation criteria in the bid solicitation and determined by the contracting authority, was accepted, or
2.	in the case that only one bid, compliant with the mandatory criteria set out in the bid solicitation was received, fair value to the Crown, as determined by the contracting authority, was obtained.
2.4	Section 6 of the Government Contracts Regulations specifies that a contracting authority may enter into a contract without soliciting bids where
(a) the need is one of pressing emergency in which delay would be injurious to the public interest;
(b) the estimated expenditure does not exceed
  (i)	$25,000,
 (ii)	$100,000, where the contract is for the acquisition of architectural, engineering and other services required in respect of the planning, design, preparation or supervision of the construction, repair, renovation or restoration of a work, or
(iii)	$100,000, where the contract is to be entered into by the member of the Queen’s Privy Council for Canada responsible for the Canadian International Development Agency and is for the acquisition of architectural, engineering or other services required in respect of the planning, design, preparation or supervision of an international development assistance program or project;
(c) the nature of the work is such that it would not be in the public interest to solicit bids; or
(d) only one person is capable of performing the contract.
3.	Reporting Entities
The reporting entities targeted in the report are the contracting authorities, as defined in the Government Contracts Regulations and the Financial Administration Act (FAA):
A.	The appropriate Minister, as defined in paragraph (a), (a.1) or (b) of the definition “appropriate Minister” in section 2 of the FAA, as follows:
(a) with respect to a department named in Schedule I, the Minister presiding over the department, 
(a.1) with respect to a division or branch of the public service of Canada set out in column I of Schedule I.1, the Minister set out in column II of that Schedule,
(b) with respect to a commission under the Inquiries Act, the Minister designated by order of the Governor in Council as the appropriate Minister.
B.	departmental corporation named in Schedule II to the FAA, or
C.	The National Capital Commission (listed in Schedule III).
In accordance with subsection 41(2) of the Financial Administration Act, the Government Contracts Regulations do not apply to Canada Customs and Revenue Agency. However, the agency has voluntarily provided data on its purchasing activity in year 2001.
4.	Exclusions under Government Contracts Regulations
The Government Contracts Regulations apply to all contracts except 
(a) a contract entered into by the National Film Board;
(b) a contract for the construction of buildings entered into under the Veterans’ Land Act;
(c) a contract entered into under the Indian Act that involves Indian moneys as defined in that Act;
(d) subject to section 4 of those Regulations, a contract for the performance of legal services entered into by or under the authority of the Minister of Justice, or
(e) a contract for the fit-up of an office or a residential accommodation where the contract for the fit-up is part of a transaction authorized pursuant to the Federal Real Property Act or its Regulations made thereunder.
(f) arrangements entered into under an Interchange Canada Agreement.
In addition, the Treasury Board (TB) has given approval to exempt the Canadian Security Intelligence Service from TB reporting requirements.
5.	Definition of Terms
The Government’s Contracting Policy includes a series of definitions that serve as the basis for the categories found in the report. 
Advance contract award notice (ACAN) – notification through the open bidding methodology of the intent to award a directed contract. 
Electronic bidding – a method of procurement that promotes suppliers’ access to, and transparency in, the procurement process and facilitates the Crown’s receipt of best value, by using:
(a) public notice by means of an approved electronic information service of procurement opportunities (e.g., MERX);
(b) public notice by means of an electronic information service of proposed directed procurements by means of an Advance Contract Award Notice (ACAN);
(c) public notice in the “Government Business Opportunities” publication; or
(d) such other procurement methods as may be approved by the Treasury Board.
Traditional competitive – a method of procurement that involves giving public notice, using traditional bidding procedures and in a manner that is consistent with generally accepted trade practices, of a call for bids for a proposed contract. 
6.	Amendments
In 2001, the total value of positive amendments (i.e., those that result in an increase in the contract value) was, $2,984.8 million. The total value of negative amendments (i.e., those that result in a decrease in the contract value) was $1,001.4 million. The total value of net amendments was $1,983.4 million. 
7.	Acquisition Cards
The above data do not include transactions using acquisition cards. Those cards are normally used only for low dollar value purchases. In 2001, there were 1.53 million acquisition card transactions for a total value of  $543.7 million. The average value per transaction was $356.
8.	Other Excluded Items
The data do not include expenditures for travel, hotel accommodation, hospitality and petty cash.