MHCA responds to Saskatchewan’s ‘local preference’ clauses
The MHCA has raised the alarm with the provincial government about local preference clauses inserted into Saskatchewan’s tender documents, requiring bidders to include local employment on construction projects.
The clauses intend to ensure local communities reap employment benefits from the projects, and all but eliminate the prospect of companies from other provinces being selected the successful bidders.
Earlier this month, Saskatchewan construction tenders were posted and included a weighting system for contract award that required hiring Saskatchewan workers. As well, an addendum was released for a significant Saskatchewan project that injected significant monetary penalties – up to 5% of total contract value — should the hiring complement fall short of threshold.
The MHCA has contacted senior Manitoba government offices, asking the province to press Saskatchewan to live by the New West Partnership Trade Agreement – signed by all four western provinces – and keep the borders free of barriers.
Local preference practices, including local hiring measures, conflict with provincial obligations under the New West Partnership Trade Agreement to which all four western provinces are signatory, and the Canada Free Trade Agreement (CFTA) which obliges all provinces and territories.
However, those within the construction industry are hearing some provinces are talking about suspending the barrier-free rules that allow free flow of interprovincial labour, by enacting the emergency measures clause within the trade agreements so the provinces kickstart their economies which have been rattled by the pandemic business shutdown.
“Unfettered competition serves the broadest public interests much better than any false notion of protecting the local market,” MHCA President Chris Lorenc said. “We need to fight introduction of measures under the guise of ‘emergency, temporary’ relief because once adopted they are very difficult to reverse.”
Trade barriers hurt everyone, especially taxpayers because open, open trade and unfettered movement of labour is the best way to assure maximum value for the dollar.
In recent Manitoba Infrastructure tenders, a total of projects, amounting to more than $18 million, were awarded to Alberta and Saskatchewan firms.
