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Procurement Directive Policy

 
POLICY:

Vita Community Living Services and Mens Sana Families for Mental Health (VITA) will abide to the Broader Public Sector (BPS) Procurement Directive issued by the Management Board of Cabinet under the authority of the Broader Public Sector Accountability Act, 2010, (Section 12).

PURPOSE:
 
The purpose of the Directive is:

  • To ensure that VITA’s publicly funded goods and services, including construction, consulting services, and information technology will be outlined through a process that is open, fair, and transparent.
  • To ensure that VITA’s responsibilities will be outlined throughout each stage of the procurement process.
  • To ensure that VITA’s procurement processes are managed consistently throughout this Broader Public Sector Procurement Directive Policy.
  • To provide guidelines for entering into contracts and to establish internal controls over the authorization of procurement processes.
  • To ensure that VITA shall endeavour to receive value for money when procuring goods, services and consulting services.

PRINCIPLES:

This Directive is based on the five key principles that will allow VITA to achieve value for money while following a procurement process that is fair and transparent to all stakeholders:

  • Accountability
    VITA will be accountable for the results of its procurement decisions and the appropriateness of the processes.
  • Transparency
    VITA will be transparent to all stakeholders. Wherever possible, stakeholders will have equal access to information on procurement opportunities, processes and results.
  • Value for Money
    VITA will maximize the value it receives from the use of public funds. A value-for-money approach aims to deliver goods and services at the optimum total lifecycle cost.
  • Quality Service Delivery
    VITA will ensure that front-line services provided by VITA staff, such as teaching and member care, will receive the right product, at the right time, in the right place.
  • Process Standardization
    VITA will ensure that standardized processes will remove inefficiencies and create a level playing field.


KEY DEFINITIONS:

"Goods and services" means any goods, construction, and services, including but not limited to IT and consulting services.
 
"Members of an Organization" means all trustees, members of the Board of Directors, Senior Executives, and employees of the organization, or their equivalent.
 
"Supply Chain Activities" means all activities directly or indirectly related to the organization’s planning, sourcing, procurement, moving, and payment processes.

"Consultant" means a person or entity that under an agreement, other than an employment agreement, provides expert or strategic advice and related services for consideration and decision-making.

"Consulting Services" means the provision of expertise or strategic advice that is presented for consideration and decision-making.

"Contract" means an obligation, such as an accepted offer, between competent parties upon a legal consideration, to do or abstain from doing some act. It is essential to the creation of a contract that the parties intend that their agreement shall have legal consequences and be legally enforceable. The essential elements of a contract are an offer and an acceptance of that offer; the capacity of the parties to contract; consideration to support the contract; a mutual identity of consent or consensus ad idem; legality of purpose; and sufficient certainty of terms.

SUPPLY CHAIN CODE OF ETHICS (CODE):

This Code does not supersede Codes of Ethics that VITA currently has in place, but supplements VITA’s Codes of Ethics with the Supply Chain specific standards of practice.

VITA has formally adopted and will abide to the Code in accordance with its governance processes. This policy’s intent is to establish the conduct of all VITA staff that are involved with the Supply Chain Activities in accordance with the Code.

This Code will be made available and visible to all VITA staff, as well as to all suppliers and other stakeholders involved with the Supply Chain Activities. This Code will be posted on VITA’s website.

Ontario Broader Public Sector (BPS) Supply Chain Code of Ethics  

Goal:VITA will ensure an ethical, professional and accountable BPS Supply Chain.

I. Personal Integrity and Professionalism
All VITA staff involved with the Supply Chain Activities will act, and be seen to act, with integrity and professionalism. Honesty, care and due diligence will be integral to all Supply Chain Activities within and between VITA, suppliers and other stakeholders. Respect will be demonstrated for each other and for the environment. Confidential information will be safeguarded. Participants will not engage in any activity that may create, or appear to create, a conflict of interest, such as accepting gifts or favours, providing preferential treatment, or publicly endorsing suppliers or products.

II. Accountability and Transparency
VITA will ensure that the Supply Chain Activities will be open and accountable. In particular, contracting and purchasing activities will be fair, transparent and conducted with a view to obtaining the best value for public money. VITA will ensure that public sector resources are used in a responsible, efficient and effective manner.

III. Compliance and Continuous Improvement
VITA will ensure that individuals involved with purchasing or other Supply Chain Activities will comply with this Code of Ethics and the laws of Canada and Ontario. VITA staff involved will continuously work to improve supply chain policies and procedures, to improve its supply chain knowledge and skill levels, and to share leading practices.  

PROCEDURES:
 
VITA will ensure that all contracts entered by, or in the name of Vita Community Living Services and Mens Sana families for Mental Health, will follow the requirements set forth in the Broader Public Sector (BPS) Procurement Directive.

CONTRACTS AND CONSULTANT AGREEMENTS GUIDELINES:
 
All contracts over $100,000 and all consultant agreements of any dollar value must be preceded by, and result from, a Request for Proposal (RFP) and a 3 bid quote. All contracts and consultant agreements must be consistent with VITA’s Mission, Vision, Values, conform to the Conflict of Interest Policy, and conform to all other applicable VITA policies.

AUTHORITY TO SIGN CONTRACTS AND CONSULTANT AGREEMENTS:

The following thresholds and approval levels are required for the procurement of goods, services and consulting services:

  • Up to $180.00 – approval by Supervisors.
  • Up to $300.00 – approval by Managers.
  • Up to $1,000 – approval by Directors.
  • Over $1,000 – $99,999 approval by Executive Director.
  • Over $100,000 –following the completion of the required Procurement Process, the selection of the winning bid is done by the Executive Management Team (minimum three members) and recommendations are presented to the ED for approval.
  • For all open tender invitations over $1,000,000, recommendations must be forwarded to the Executive Director and to the Board of Directors for approval. The requirements must be defined properly and clearly and in compliance with the procedures covered in the BPS Procurement Directive.

See attached BPS Procurement Directive Guidelines for additional information on mandatory requirements for Procurement Process.

Levels:

  • All contracts entered into by VITA that exceed $5,000, but under $1,000,000 and/or binds VITA for more than one year, but less than 5 years, must be reviewed and approved by the Executive Director.
  • All contracts entered into VITA that exceed $1,000,000 and or that binds VITA for more than 5 years must be reviewed by the Executive Director and approved by the Board of Directors.
  • Any purchase with a gross value greater than $25,000 and not approved in the budget shall be reviewed and authorized by the Executive Director and forwarded to the Board of Directors for final approval.
  • It is the responsibility of the individual with the signing authority involved in the purchase and reimbursement of goods and services to ensure compliance with this policy and procedure. The Finance Department is responsible for verifying that the amount requested is supported by the attached documents and that the signature is by the appropriate signing authority.
  • The Supervisor or Manager of the department the purchase is related to approve the requisition.  Special authorization is required if the amount of the requisition is over a certain limit or an unbudgeted expense. Only individuals with the appropriate level of authority are able to approve the cheque requisition.

CONTRACTS NOT PREVIOUSLY INCLUDED IN THE ANNUAL BUDGET:
 
All contracts and/or other expenditures up to $25,000 for which prior budget approval has not been given will require a budget proposal to be prepared, reviewed by the Finance Department (to allocate to the appropriate program budget) and submitted to the Executive Director for approval.  Contracts and/or other expenditures that exceed $1,000,000 must be reviewed by the Executive Director and forwarded to the Board of Directors for final approval.
 
SIGNING OF CONTRACTS:
 
The Executive Director or the designate, who has obtained prior written approval from the Board of Directors and has been granted signing authority, shall sign each contract. Each contract will be witnessed and dated and may be embossed with the corporate seal.
 
LOCATION OF ORIGINAL CONTRACTS:
 
An original signed copy of all contracts that bind VITA must be provided to the Finance Department located at VITA’s Head Office for filing and monitoring.
 
PURCHASE OF SERVICE CONTRACTS:

Definition:

A “purchase of a service contract” is a written agreement between VITA and an individual or organization in which specific services are to be provided. The following shall apply to all contracts signed by VITA:

  • All purchases are within the approved budget.
  • The Board of Directors authorizes the annual expenses of the agency by approving the annual budget.
  • For any purchases not incorporated into the fiscal budget, the Board of Directors delegates authorization responsibility to the Executive Director.  However, the Board of Directors shall be informed of major purchases that have the potential to affect the direction or financial results of the agency.

RESPONSIBILITY:
 
Prior to the commencement of any contract, VITA will ensure:

  • Contracts are entered into when there is an advantage to the agency by doing so.
  • A full range of potential arrangements is investigated before entering into an exclusive contract.
  • Legal assistance or advice is obtained if necessary for any non-standard clauses.
  • All contracts entered into by the agency are reviewed and approved by the Executive Director or designate. Special authorization is required if the amount of the contract is over a certain limit or an unbudgeted expense. Only individuals with the appropriate level of authority can approve and sign a contract.
  • As best practice, contractor must provide proof of liability insurance and WSIB coverage where appropriate.
  • Each contract is dated, witnessed or embossed with the agency’s corporate seal if required.
  • The agency also ensures that a completed copy of the final contract is made available to all other signatories.
  • The original copy of a signed contract is kept in a secure place at the agency’s finance department.
  • All Purchase of Service contracts must meet the agency’s conflict of interest guidelines as referred to in policy #2.28 “Conflict of Interest”.
  • At least 3 months prior to the completion of the contract, the Executive Director or designate reviews and plans for the renewal or tendering of the contract following the above procedures.

Content of Contract:

At a minimum each Purchase of Service Contract entered into by VITA shall provide the following information:

  • The nature of the service.
  • Anticipated outcomes.
  • Reporting requirements.
  • Financial obligation.
  • Period of time covered by contract (no contract can be established in perpetuity).
  • Invoicing procedure and payment schedule.
  • Termination and escape clause.
  • Table of content regarding negotiated work plan.
  • Name(s) of VITA staff who have been given the authority to act on VITA’s behalf in relation to the services provided and the service provider.
  • Description of monitoring process.
  • Confidentiality Agreement.
  • Warranty for completed services meeting the quality standards specified.
  • Allowable expenses as per VITA’s Policy #18.01 Perquisites Policy and Policy #18.2 Expenses Policy.

INFORMATION REQUIRED FOR PROPER PAYMENT AUTHORIZATION:

All invoices must be reviewed and approved prior to payment by the staff authorized to sign. Authorization is to include:

  • Date- Date of request.
  • Completed by- Name of the person completing the form (if a cheque requisition).
  • Payable to- The name and complete address of the payee.
  • Description- Reason for payment cross-referenced to supporting details or documents and attached to the requisition.
  • Coding section- The account code or codes to be debited and the corresponding amounts with taxes (PST and GST) identified separately.
  • Amount– Total amount of the cheque to be issued.
  • Approved by- Requires authorized signature on purchase order (PO).
  • Special delivery instructions- If the cheque is not to be directly routed to the payee then the appropriate routing instructions need to be reported in this space.
  • Date required– Record date cheque is required if different from regular cheque run.

CONSISTENCY WITH ALL OTHER VITA POLICIES, PROCEDURES AND GUIDELINES:
 
A Purchase of Service contract must adhere to all other VITA policies, procedures and guidelines with respect to financial support, expense rules (hospitality and incidental expenses), levels of approval authority, levels of signing authority and location of originally signed contract.
 
In no circumstances can hospitality, incidental for food expenses be considered allowable expenses for consultants and contractors under the rules or in any contract between an organization and a consultant or contractor.  Therefore, they cannot claim or be reimbursed for such expenses, including:

  • Meals, snacks and beverages.
  • Gratuities.
  • Laundry or dry cleaning.
  • Valet services.
  • Dependent care.
  • Home Management.
  • Personal telephone calls.

PROCUREMENT RECORD RETENTION:

VITA will handle, store and maintain vendor’s confidential and communicational sensitive information in an appropriate and legal matter.
VITA will conduct procurement activities according to the law in Ontario, including contract law, the law of competitive processes, privacy legislation, accessibility legislation and any other legislation as may be applicable.

VITA will also be subject to various trade agreements, including but not limited to the Agreement on Internal Trade (AIT) and the Ontario–Quebec Trade and Cooperation Agreement (Ontario–Quebec Agreement).

EVALUATION:
 
This policy will be evaluated and reviewed annually by management.

APPENDIX:
 

  • Request for Proposal (RFP).
  • Policy #2.28 “Conflict of Interest Policy”.
  • Policy #18.01 “Perquisites Policy”.
  • Policy #18.02 “Expenses Policy”.
  • VITA’s Standard Consultant Agreement.

REFERENCES:
 
http://www.fin.gov.on.ca/BPSsupplychain
 
Copy of the Broader Public Sector (BPS) Procurement Directive Policy Guidelines.

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Vita Community Services/Mens Sana
4301 Weston Rd.
Toronto, ON
M9L 2Y3
416 749 6234 (Telephone)
416 749 1456 (Facsimile)