The report by the Office of the Auditor General of Canada (OAG) has also concluded that Infrastructure Canada did not adequately manage selected procurement risks to mitigate cost overruns and delays.
Recommendations for improvements in the planning of future projects and the management of procurement risks are included in the report; the recommendations have all been accepted by Infrastructure Canada.
In October 2011, the government of Canada announced construction of a new bridge to replace the existing Champlain Bridge, which links the Island of Montréal with the south shore of the St Lawrence River. The existing bridge was less than 50 years old, but it had deteriorated badly.
This audit focused on whether Infrastructure Canada managed selected aspects of the new Champlain Bridge project to meet the objective of delivering a durable bridge on time and in a cost-effective manner.
“Overall, we found that the Government of Canada was slow in making the decision to invest in a new bridge instead of maintaining the existing one,” said the OAG. “This finding matters because the delay in decision making entailed avoidable expenditures of more than $500 million [US$385m], apart from the economic costs to the Greater Montréal area due to the congestion and load limitations on the existing bridge.”
The OAG also found that Infrastructure Canada completed its analysis of the procurement models for the new Champlain Bridge project two years after it announced the choice of a public-private partnership model. “If the Department had thoroughly analysed the procurement models for the project, it would have found that the public-private partnership could be more expensive than a traditional model,” it said.
After awarding the contract, OAG said that Infrastructure Canada made several changes to the project, some of them major, to respond to the needs of surrounding communities and stakeholders. “The negotiations on these changes, which were ongoing at the time this report was published, have been time-consuming,” it said. “In our view, the private partner will not deliver the new Champlain Bridge within budget. In addition, the delivery of the new bridge on time appears very challenging.”
In future public-private partnership projects, Infrastructure Canada should minimise the number of project changes and approve them in a timely manner, to reduce the risk of cost overruns and delays said the OAG.