Appendix: The Long Term Vision and Plan: Annual Report 2018 to 2019

Appendix A: Project management

The delivery of a program as complex and multifaceted as the Long Term Vision and Plan (LTVP) requires rigorous risk management. This includes Public Services and Procurement Canada (PSPC)’s own processes, as well as the third party oversight by both government and private sector specialists. Key elements include:

Contracting: PSPC’s Integrity Framework is intended to increase departmental due diligence in its dealings with third parties in order to reduce fraud against the Crown. Major construction work on Parliament Hill is contracted through a transparent, 2 stage process to promote competition. All contractors on Parliament Hill must obtain a security clearance. At PSPC, the technical authority is clearly separate from the contracting authority. Independent fairness monitors review and report on major procurements and provide independent assurance to departmental management, client departments, government suppliers, Parliament, and Canadians that PSPC’s large and complex procurement activities are conducted in a fair, open, and transparent manner. These reports are published on PSPC’s website.

Audit regime: In 2010, the Auditor General found that sound project management practices were in place for the rehabilitation of the Parliament Buildings. In 2012, the same observations were made by experts, Raymond-Chabot Grant Thornton. Between 2014 and 2015, Price Waterhouse Cooper provided certified clean financial audits for the construction management contracts for the West Block, Wellington and Sir John A. Macdonald Building projects—these audits are performed on a cyclical basis and will be put in place for the Centre Block Rehabilitation project once it begins.

Cost, schedule and design quality management: Cost estimates, schedules and design quality management are developed by a prime consultant for each project, and are then reviewed, assessed, and challenged by internal and external experts. Estimates are also reviewed on a monthly basis by independent costing experts.

The rehabilitation of the buildings within the precinct is of a scale and complexity that is unrivalled in Canada. Given the extent of the interventions, PSPC has used pilot projects on many buildings to obtain valuable information about building conditions and reduce the likelihood of time, scope, or budgetary risks for major projects. Early work on the West Block’s North Towers provided invaluable insight into the extent and nature of the program required for the full West Block rehabilitation. PSPC also partnered with the Universities of Calgary, Alberta and Manitoba to tap into their knowledge and technical facilities for leading-edge seismic testing of replica walls made of the same stone as the Parliament Buildings. This provided research and evidence for the large-scale structural reinforcement of heritage masonry walls.

The renovation and rehabilitation of heritage buildings is complex and difficult to forecast. As an important component of effective costing, PSPC has developed and implemented a robust costing methodology including a systematic approach to allocating appropriate allowances for contingencies and risk. Allowances are specific to every project to reflect its unique characteristics, building conditions and overall complexities and constraints. Over the past number of years, this methodology has been validated by independent third-party experts as part of the Science and Parliamentary Infrastructure Branch’s sound project management practices.

PSPC also uses contingency allowances to address cost estimating uncertainties and known issues that occur on every project. For example, this could include a change to a project’s design to accommodate new scope. Contingency allowances are applied to key project cost elements, such as design, pricing and construction, and are adjusted to reflect the refinement of a project as part of ongoing project management activities.

Risk allowances address certain circumstances that may or may not occur during the implementation of a project. Examples of key risks on LTVP projects include key changes in client requirements, market conditions/ fluctuations, and availability of trades. Risk allowances are applied as a single-line item to the aggregate project cost estimates. Initial risk allowances are reviewed and refined throughout the development of a project leading to the identification of individual risk events. Each risk event is then qualified as to its probability of occurrence and then quantified to determine its potential cost impact. Mitigation measures are also identified for each risk event. Managing risk is part of ongoing project management activities.