The Ontario Construction Secretariat (OCS) has released a report by Prism Economics and Analysis disputing claims by the Cardus organization, and urging municipalities to continue their partnership with the building trades unions.
The report titled Just Not Credible: Challenging Claims About Closed Tendering in Ontario directly refutes Cardus’ claims that municipalities would save on construction costs. The Prism Economics report describes Cardus’ claims as “just not credible” saying the proposed savings are unrealistic and do not consider the other risks of leaving collective agreements.
The OCS report points to a 2008 City of Toronto study which concluded that the higher costs resulting from collective agreements with the building trades unions were at most 1.7% rather than the 15%. A more recent report (May 2019) from the City of Toronto stated that if the bargaining relationships with the building trades are terminated “… it is not possible to determine with any certainty what, if any, savings will result.”
John O’Grady, the author of the report, also argues that the Cardus claims are based on "irrelevant examples such as corruption" in Montreal’s construction industry and a British Columbia project where Government focused on achieving a broader social objective over cost savings.
The release says other examples are not relevant to Ontario and do not take into account the safety record of contractors that work with the building trades unions and the important role they play in Ontario’s skilled workforce.
O’Grady notes “higher productivity is the only sustainable and fair way to lower costs” and urges municipalities to “focus their procurement policies on the factors that truly reduce construction costs”.