The top post of 2012 on LailaYuile.com: “How money and corruption are ruining the land.” originally posted June 19th, 2012

Corruption in government has been on many readers minds this year, backed up by this story, first posted here back in June, which received a whopping number of unique views, catching the attention of readers and governments alike, around the world.

As a precursor to coming stories, I urge you to read this post, and the report, and think about the less sensational side of corruption, the side we don’t often see.

And think about, why most people in B.C. who were approached during the investigation leading to this report…. refused to even talk about it.

“Money and corruption are ruining the land…”

Posted on June 19, 2012by

“…crooked politicians betray the working man, pocketing the profits, treating us like sheep, and we’re tired of hearing promises that we know they’ll never keep.” ~ Ray Davies

Here on this site, I have revealed many breaking news stories of secret deals,evidence of corruption, collusion and a number of other shameful instances of how ‘money and corruption’ are ruining the land – our land here in British Columbia.

Sea to Sky Highway Shadow Tolls and the insidious relationship between the BC Liberals and long time, private partner Macquarie. The same partner that oddly, still managed to keep a position as advisor to the Port Mann project after a failed P3 bid, the terms of which remain secret to this day.

Canada Line construction and the ongoing, equally insidious relationship between SNC Lavalin and the BC Liberals.

Tercon vs British Columbia, a landmark case where the Ministry of Transportation and several high level government employees altered documents and hid details to purposely rig a bid and give a large contract to another ‘ preferred’ bidder.

You name it, there is not a P3 deal, nor a major transportation project that I have not examined,with confidential documents or hard sourced evidence, that does not give rise to an extensive list of questions about the governments ad hoc policies, and the lack of integrity in the bidding process. ( For newer readers, each can be read in detail, on the Best Of page up top)

Throughout these stories, there remained a dark undercurrent that repeats itself time and time again. In many stories, there are what I would consider clear indications of unethical and questionable behavior that lean towards collusion and influence of officials, both crimes in Canada under the competition bureau and of which I have previously written.

Yet we see no investigations.

Business continues as usual, from Gordon Campbell  onto yet an even more disastrous leader, Christy Clark, who has openly discussed her relationship with a powerful man who remained on the Board of Directors for SNC Lavelin – while the company has ongoing contracts and new bids outstanding.

Surprised? Shocked?… Why ?

This is how it works in British Columbia, not unlike how it works in Quebec. We just seem to have perfected the ability to fly under that radar.

This is the preferred way of doing business that most bureacrats with the provincial government, have no problem with…. and one that spans all ministries – none have been exempt from scandal or inference of preferred bidders.

People like myself rely on close sources and data-mining to acquire evidence and documentation of contract and project details kept hidden from the public, since most FOI requests result in pages of useless redacted information.

Earlier this year, CBC did a brief story online, on a study conducted by the ministry of Public Safety into corruption in the construction industry in B.C. and in Quebec. The only real details given to the press on this report,which was not released, were that very few wanted to talk about the issue of  construction corruption in B.C. , despite the fact that the construction industry overall, was at a medium to high risk of corruption in this province.

Imagine that.

So few of the people or organizations contacted wanted to talk about this issue of corruption in commercial construction – and by association of public sector projects, the government –  that it made it difficult to get a firm vision of what exactly is going on.

In fact, the report relied on many anonymous sources in some instances to get the information needed to make an assessment.In spite of this aura of reluctance and opposition to prying questions, the report did manage to uncover some revealing ways our public projects are at risk for corruption… and the way our government makes this possible.

The report in question was released informally to me by the federal government recently following an FOI request, and confirms much of what I have reported here in many stories over the last few years. I recommend a read of the entire report, for the insight it offers into the problems facing large public projects here in B.C.

Here are some highlights:

  • Investigators found that the most vulnerable aspect of the commercial construction process, including public projects, was the procurement process ( bid process) and project management. Sources indicated officials responsible for procurement were often uninformed about the cost of construction project costs and the lack of accountability and transparency in the bidding process across Canada was noted.
  • Investigators found many factors that contributed to an environment where bribery and fraud flourished and were nearly impossible to detect,including the large scale of public projects,the uniqueness and complexity of projects,the concealment of some items of work by others, the lack of transparency in the industry and the extent of government involvement.
  • Situations that facilitate the formation of construction cartels and bribery, included the size of the project. Some projects like dams, power plants and highways that are extremely large in nature and costly,making it easier to hide bribes and over inflated  claims. It was also noted these larger projects often have a limited number of bidders, and those bidders are often well known to public officials and other bidders, again facilitating bribes and cartels.
  • Lack of transparency – costs are often kept secret even when public money is being spent. Commercial confidentiality takes precedent over public interest, and publication of financial information and routine inspection of books and records which could uncover irregularities or prevent them, does not take place. ( in the case of the Sea to Sky highway project, companies participating in the project had to sign confidentiality agreements preventing them from talking about their involvement in the project in some cases, for up to 7 years, as you can read in the Sea to Sky shadow toll series on the Best Of page at the top of my site – Laila)
  • The extent of government involvement- There is significant government involvement in public projects. Even private sector projects require government approval at different levels. The power wielded by government officials in every stage of the construction process,when combined with the structural and financial complexity of these projects, makes it quite easy for unscrupulous government officials to extract large bribes from those undertaking the projects.
  • The impact of corruption in projects goes beyond bribes and fraud, to poor-quality construction and low funding for maintenance. Because much of the infrastructure is hidden behind concrete or brick, builders can cut costs, bribe inspectors to approve sub-standard construction leading to poor quality construction.

( In Quebec, years of this kind of construction on public infrastructure is creating a problem for the province, with crumbling bridges and overpasses that need extensive rehabilitation. Will we see the same thing happen here in British Columbia with some of our major transportation and infrastructure projects? Certainly many projects have already shown evidence of substandard quality, via the expansion joints on the William R Bennett bridge in Kelowna, and the ever collapsing retaining wall on Lougheed, part of the Port Mann project. – Laila)

  • Sources in British Columbia indicated that government officials responsible for the procurement process ( tender and bidding process) lack the required experience in relation to the commercial construction process.

Many who did have the experience retired or moved onto the private sector. Government officials often failed to follow their own procurement policies. ( I have explored this in detail on a previous post, where a source revealed to me that often, the officials in charge of a project will rely on employees of a bidding company for direction, via hiring them as a consultant in the process. Fairness reviewers deemed with examining the bid process for fairness, are often seen as being in a perceived conflict via work with the government on other projects- Laila)

It is simply not acceptable, nor is it in the publics interest, to allow often incompetent, and more often unethical business practices to continue within the B.C. government. It absolutely must stop.

In 2010, in following final ruling of the decade long Tercon vs. British Columbia court case, I said the following:

“.. What is needed is a full and independent inquiry into the actions of the government then, and now, to reveal the truth of what is going on in that portfolio. If the government intends to stand by its claim of administering an honest and open government with integrity, let it start with the Basi-Virk trial upon our doorstep, and end with the Tercon Judgement. The integrity of the entire bidding process, the future of local industry in our province, and what little faith we may have remaining in our elected officials, depends on it.”

That was 2010. As we know, the Basi-Virk trial was shut down faster than a bear trap snaps its victim, and while Vaughn Palmer picked up the Tercon story, the government denied and ignored any lingering questions.

Two years later, we find ourselves with a premier who campaigned on bringing open government to the people and then quickly revealed herself as being more secretive than Campbell ever was. A premier who mandates transparency and accountability to ensure tax dollars are being spent wisely to give British Columbians a better quality of life… but applies that mandate selectively, targeting her foes and protecting her friends.

I say now, that this report bolsters and supports my repeated calls for a full investigation  and public inquiry into the public procurement process within all ministries of the government of British Columbia, and the sooner the better.

To do anything other, is to condone corruption within government by our elected officials -a concept which should have never been tolerable in the first place.

Public Safety Construction Corruption Report PDF format ( I will be happy to email you a copy of this report upon request)

This entry was posted in BC Liberals, BC NDP, BC Politics, BC Rail, Corruption, crime, Federal politics, Laila Yuile, P3 projects in BC, The China Connection and tagged , , , , , , , , . Bookmark the permalink.

19 Responses to The top post of 2012 on LailaYuile.com: “How money and corruption are ruining the land.” originally posted June 19th, 2012

  1. Julie says:

    We are all so aware of the lies, deceit, thefts, corruption, dirty tactics and dirty politics in this entire country and in especially BC. During Campbell’s reign of terror, he utterly destroyed BC. He thieved and sold everything he got his dirty hands on. Nor, do we forget Harper’s part in the destruction, signing sneak deals with Campbell behind our backs. Such as, the Enbridge pipeline signing deal, the HST among many other vile sneak deals. Then we have Christy who had the opportunity to clean up some of Campbell’s treachery. What did she do? Nothing. She chose to work for Harper, as Campbell did before her. Hiring Boessenkool, really Christy? What for? Why him, he’s a Conservative? Christy’s job plan is for the Chinese, not for the BC people. Does that nonsense stop her lies? Not on your Nelly.

    We see and know all of this as people do so in other corrupt, cruel, thieving, evil dictatorship country’s, ruled by tyrants. That’s why there are armed rebellions, chaos, killing, fires, bombs, rocket launchers and all kinds of violence.

    What about Harper handing this country over to China? Giving our resource and resource jobs to China too? Elizabeth May pointed this out to Canadians. Part of Harper’s asinine omnibus bill, gives China the right to sue any Canadians, getting in China’s way. China sued in BC, for the mining jobs. BC miners must speak Chinese Mandarin to obtain a mining job, in our English speaking province? Campbell gave our resources to China long ago. CSIS warned us, remember? Communist China was making huge inroads into Canada. BC was specifically mentioned.

    Unless Canadians have an armed rebellion as other country’s do? The evil going on in this country, is not going to stop. Canadians don’t behave like that. Canadians deplore violence. We have, Democracy, Civil Rights and Liberties, the Charter, Freedom of Speech and Human Rights. At least we used to? Someone must have hid those rights on us. We need to find them and get them back.

  2. Merv Adey says:

    Something that jumps out at me also jumped out when Campbell mandated P3 form for all mega-projects: namely that corporate confidentiality is at odds with the public interest where public dollars are being spent. Collectively we take it on faith that processes will be honest, and that the private sector does it better and cheaper. In many cases perhaps it’s true. But in the environment created over the last ten years, how could the only balancing force, public audits, ever prove that faith is sound? The Auditor Generals office doesn’t have a fraction of the resources necessary to examine every project in a timely way.

    • Laila says:

      This is the heart of the issue.

      Government malfeasance is not as obvious as one might think,which is why the points I have highlighted in this report are so important.

      The current government that purports to be the one, in feel good Christmas and year end “I’m a mom, I get it” videos, is the same one that cut the auditor generals office off at the knees http://lailayuile.com/2012/08/07/bc-government-strangles-auditor-generals-office-while-government-credit-card-spending-run-amok/

      This report shows that many government officials in many ministries, lack the knowledge to know what is correct methodology and price on bids, etc. Until this is corrected, nothing will change in BC. Change must come on a largescale level. Any new party must embrace addressing this change, and the elements in this report.

      So, heres a question for the other pundits out there. Why isn’t there an inquiry or anti corruption team in BC right now and why does the BC government want to stifle the auditor generals office? Or is this report all something there is a group decision out there to ignore?

  3. nonconfidencevote says:

    A healthy main stream media is absolutely necessary in holding the people in power accountable.
    Unfortunately one of the big differences between BC and Quebec is our MSM. Our media base is shrinking ( cutbacks, station closures, rumours of the The Province demise, to name a few).
    Quebec has always had a vibrant MSM, granted most of the newspapers there are sensationalist, soft porn pap BUT they are newspapers……. We only seem to have the Blogosphere to rely upon.

    I’ve had experience in the construction sector and the contract bidding process.. Corruption isnt as widespead as is generally believed. (at least not at my lower level of the bidding process).
    Perhaps legislation that bans any former govt worker or (better yet) any politician from working for a company (or it’s subsiduaries) for 5 years from the end of the contract ( gee how many 30 year SNC contracts would be signed after that!) Unfortunately, thats a dream that will never happen……
    As was mentioned in your post. Govt cutbacks in the sectors where knowledgable staff who understood construction, understood the bidding process, understood how to follow up and hold negligent contractors accountable have been gutted…..these people are usually senior staffers and ….lets face it.
    If you have 30+ years in govt, a sweet pension, and have to swallow daily bs from incompetant (corrupt) politicians, would you stay? Or take a lesser position for the same money? Or take a severance package?

    I know what I’d do

    • Laila says:

      ( I’ve had experience in the construction sector and the contract bidding process.. Corruption isnt as widespead as is generally believed. (at least not at my lower level of the bidding process).

      Speaking specifically to gov projects and higher level bureacrats and staffers, see Tercon. Sources indicate this is more widespread which is why no one wants to talk about it.

      No comment on the rest…. I know many have gone from high level ministry positions to consult positions in the field, aka Dan Doyle for one example…. and have written about this…

      This report speaks to a more insidious form of corruption that can have long lasting impact on public coffers, as in Quebec where poorly made infrastructure from cutting corners is going to be a huge issue for municipal and provincial govs moving forward.

      We should strive to avoid a similar fate here in BC.. if it is not too late.

  4. Gary says:

    After refusing to listen or read any form of New’s between Christmas Eve and New Years Day, I wish you a belated Merry Christmas and Happy New Year.

    Lordy, Lordy, where does one start? It’s got to the point where one has to keep a tab file to keep track of what, who, and when. But you’ve hit the nail on the head. Where are the Inquiries? By my count there should be at least 5 going on right now. Let’s not forget one of the biggest Ponzi Schemes that was run with our elected officials, and B.C. Ferries. If you and I pulled that one off we would be in jail. What is starting to concern me, is that some of this corruption has seeped it’s way into our Justice System, and our Police. B.C. Rail being a prime example. Also, I’ve run into some questionable conduct by our beloved By-Law and Permit people in my little Hamlet of Surrey. It’s creeping in everywhere. But people are getting frustrated, and that is a good thing. The trick is to take that energy and direct it.

    A War is made up of many battles and it is time for people who read this Blog and others to start the little battles with their Members of Legislature, demand answers, be persistant and start doing it weekly, talk to the Advertisers of the Peoples Radio and MSM, let them know, word of mouth is a powerfull technique, and pretty soon those little battles turn into big battles and then a force to be reckoned with is formed. An election is coming up and now is the time to start turning the heat up on these people. Each person can phone, write, or e-mail their Member, the Advertisers, the small shop owners who carry the products of the Advertisers, the Editors, the Station Managers, people you talk to on the street or mall, your neighbour, or wherever. Soon your singular voice becomes many voices, and then there is no choice for these carpet-baggers, who think they are above the fray, to start responding to the people who elected them, and soon they will realize they will be gone if they don’t.

    • Laila says:

      And to you, my friend, may you have a wonderful 2013!!!

      Great comment. Yes, there are questionable activities all over BC, and people need to start looking at their cities, towns, villages…. asking questions, demanding answers.

      It’s your tax revenue that assists in running the municipalities, and your votes that elected the officials. If you fail to hold them to account, you really can’t whine about what you get in the end.

  5. islandcynic says:

    Thanks for this Laila. This should be the number one election issue next May and we need public discussion. I tried to have this conversation with my neighbour and he thought I was to emotional and did not want to debate me over it! If you don’t see it in the MSM, people don’t believe it is happening. We and our future generations cannot afford this corruption, we’re going broke.

  6. The City of Vancouver’s Bike Share procurement is another example of a what appears to be a questionable process in awarding contracts. Did it really make sense to award Alta Bicycle Share a contract so early on without a final specification? Will the best option be chosen? This bike share item will be in front of City Council for final approval really soon so you might want to keep an eye on it. More information: http://wp.me/p18o1P-2vz and http://wp.me/p18o1P-2Wd

    • Laila says:

      Very interesting. I’m a firm believer of a creating a firm specifications before putting any contract or job out to tender, with no less than three respondants. Of course, it is possible for only one company to even respond in newer industries or initiatives, but I dont have the information to say on this specific issue.

      There is such a lack of transparency in procurement over all, at the muncipal and provincial levels. (For regular folks, procurement is the process of putting out a job to tender, for companies to bid on and is used to describe the whole process )

      I don’t know how Vancouver handles this process, or what their guidelines are, but there should be some.

      It’s interesting to note that provincially, the province and the crown corps can pretty much do whatever they want even once the tender/bid process is well underway, which is what happened with the Port Mann bridge. The process was begun as a P3, but when that failed to happen, the province did not put the project back out to tender again, which would have been the fair thing to do to ensure the province received the best price and contract options. But no, they simply went with the bid consortium who had already failed to secure financing terms pleasing to the province, which was Kiewit/Flatiron, and kept Macquarie on as ” financial advisors”

      That project alone resulted in howls across the industry when it did not go back out to bid.

      Not to mention the utter lie that this is a fixed price contract..lol… no contract really is. There are so many clauses that allow for overages in price and time… I have a post coming on this project again in the next week or so. http://lailayuile.com/2012/02/26/official-truths-are-often-powerful-illusions-john-pilger/

  7. ” In BC several of the province’s private partners in P3s have had their operations sold on to companies resident in tax havens like Guernsey and Luxembourg.” Another BC Liberal government failure. Read the rest at: http://www.policynote.ca/

    • Laila says:

      Thank you Guy, And Happy new year! I read this yesterday and was actually going to post it this morning… and will do so still with some more quotes. Keith has been writing about P3′s for a long time and was instrumental in getting me turned onto these projects as well. I’ve written about so many now, and it is one issue I am eager to hear where the NDP stand on – Dix has only said he would not support P3′s in healthcare, but no comment from anyone in the party on other sectors.

      Here is a multi page history for new readers on p3′s in the province, along with stories on the best of page. http://lailayuile.com/?s=p3

  8. Curt says:

    http://www.biv.com/article/20130104/BIV0109/130109976/exclusive-bc-place-renovation-final-costs-were-five-times-original
    Oh these wonderful “money managers” . Is this province in trouble or what? Time to go after the crooks.
    It’s in the best interests of the province to do so.

    • Laila says:

      In a related point, the Globe and Mail had a fantastic article this summer on bribery and corruption… still very relevent today.

      http://www.theglobeandmail.com/news/politics/canada-ranked-worst-of-g7-nations-in-fighting-bribery-corruption/article592312/

      A must read.

      Canada has again been scolded on the international stage for its “lack of progress” in fighting bribery and corruption by a watchdog agency that ranks it among the worst of nearly 40 countries.

      Transparency International, a group that monitors global corruption, put Canada in the lowest category of countries with “little or no enforcement” when it comes to applying bribery standards set out by the Organization for Economic Co-operation and Development.

      ……

      The poor rating places Canada in the embarrassing company of countries like Greece, Hungary, the Slovak Republic and Slovenia – although New Zealand and Australia are also among the 21 countries in the bottom rung.

      …..

      Since the Corruption of Foreign Public Officials Act became law 13 years ago in Canada, a small fine against an Alberta company in 2005 has been the only conviction ever recorded. A trial set to start this August against an Ottawa man accused of bribery in India would be only the second time a charge has been laid under the act.

      By contrast, the United States has prosecuted more than 200 companies and individuals, many of them “a veritable who’s who of the corporate world,” according to Peter Dent, a partner at Deloitte and Touche, LLP who also sits on the board of Transparency International.

      “It is naive to think that you cross that 49th parallel and somehow we’re pure as the driven snow,” he said. “Canada does not have a great reputation when it comes to the enforcement of white-collar crime. If it’s not taken seriously by government, it won’t be taken seriously by the corporate sector.”

      ……

      Canada is also one of a handful of nine countries that explicitly permits so-called “facilitation payments” to foreign officials for acts of a “routine nature” that may be part of their jobs.

      When it comes to enforcement, Transparency International warned there was an “inadequacy of resources” at the RCMP’s Anti-Corruption Unit because officers were periodically re-assigned to other duties.

      Todd Shean, the RCMP’s chief superintendent in charge of financial crime, said the unit has 14 investigators in Ottawa and Calgary currently handling about 23 cases of alleged foreign bribery.

  9. Pingback: “Are Tax Havens robbing the government of P3 revenue?” |

  10. It’s our money and there really do not seem to be adequate checks and balances to make sure it is not being misspent.

    • Laila says:

      None Bernadette, none.

      • bernadettekeenan says:

        So sad but true. They need some kind of a committee composed of perhaps low – income types, with a few single parents on a limited budget sorts, oh and senior citizens too for good measure. Folks who know the value of a $$$. We would start getting much better bang for our buck on public projects I am sure.

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