Halifax-Class Design Agent Services

1. Introduction

HKA Global (Canada), Inc. was engaged as the Fairness Monitor (FM) to observe the competitive procurement process for the Halifax-Class Design Agent Services (HcDAgent) project. This competitive procurement process is being undertaken by Public Services and Procurement Canada (PSPC) for the Department of National Defence (DND).

We hereby submit our Final Report on the HcDAgent project covering our activities chronologically from the initiation of FM activities on March 2, 2016 through the Industry Engagement stage, Invitation to Qualify stage, Qualified Bidders’ Engagement stage, Request for Proposals stage to the selection of a winning proposal.

HKA Global (Canada), Inc. is an independent third party with respect to this activity.

We reviewed all of the information provided and observed or monitored all relevant activities.

This report includes our attestation of assurance; a summary of the scope and objectives of our assignment; the methodologies applied; and details of our activities, including any relevant findings from the activities undertaken.

2. Attestation of assurance

The FM hereby provides the unqualified assurance statement which follows concerning the competitive procurement process for HcDAgent.

It is the professional opinion of the FM that the competitive procurement process for HcDAgent was conducted in a fair, open, and transparent manner.

3. Project requirement

The Royal Canadian Navy currently operates twelve Halifax-Class ships and intends to operate them until the end of their life. To support this effort, DND has a requirement to establish an In-Service Support Contract for a Halifax-Class Design Agent. The work of the Design Agent will be an integral component for the successful operation of the Halifax-Class ships and will be required throughout their expected life span. DND will retain the Design Authority role.

The Halifax-Class Design Agent will manage the Technical Data Package and provide project management, engineering services and drawing/drafting services to maintain the Halifax-Class Design Intent. These services will include but are not limited to:

• develop engineering solutions and designs to integrate new and modified ship systems
• assess impacts to existing ship systems to integrate these solutions into the Class
• develop engineering change packages for execution by implementation agencies
• maintain and distribute technical data
• provide engineering services to resolve technical problems and improve equipment performance and its support
• provide engineering change project management support
• develop and support a collaborative information environment

The scope of Design Agent work includes management, configuration management, engineering services, product configuration information, and electronic information environment.

The initial contract will be for a period of six years. Canada may exercise up to 16 optional contract extensions.

4. Objectives of the fairness monitor assignment and methodology

The overall objective was to provide independent observation and monitoring of the procurement process and to submit fairness related comments to project officials, as early as possible, so that appropriate action could be taken to address the comments before fairness was impacted. The Director, Fairness Monitoring would be advised of any fairness related concerns that were not addressed promptly. At the conclusion of the procurement process an assurance statement as to its fairness would be provided.

To accomplish the objective, we undertook the following activities and, where applicable, provided fairness related comments to the Contracting Authority:

• became familiar with the project governance structure and background information
• reviewed all solicitations in draft form and as posted on buyandsell.gc.ca and as released to the interested firms
• reviewed all amendments to the solicitations, as well as questions submitted by respondents and answers provided
• observed industry day meetings with interested firms during the Industry Engagement stage and with qualified bidders during the Qualified Bidders Engagement stage
• observed all commercially confidential meetings held with each of the firms during the Industry Engagement stage and with Qualified Bidders during the Qualified Bidders’ Engagement stage
• observed all technical evaluation consensus meetings
• reviewed the financial evaluation process used and results obtained
• reviewed the application of the basis of selection

5. Fairness monitor specific activities and findings

5.1 Fairness monitor activities and findings related to the industry engagement stage

On March 8, 2016 we reviewed project planning background material. No fairness deficiencies were identified.

On November 3, 2016, we reviewed draft parts of Letter of Interest 1 (LOI 1). The purpose of the LOI was to obtain feedback from interested firms on the requirement and to provide a general understanding of the requirement. The LOI included front end material, concept of operations, statement of work, rolling wave contract duration concept, and questions to which firms would be invited to respond. No fairness deficiencies were identified.

On November 10 and 11, 2016, we reviewed LOI 1 (Document 1) as posted on buyandsell.gc.ca. Fairness related comments were provided and appropriate action was taken by project officials.

On December 21, 2016, we reviewed LOI 2 (Document 2). The purpose of LOI 2 was to invite interested firms to an industry day on January 12, 2017. The event would consist of a plenary session with all interested firms present, and individual one on one meetings with interested firms. On January 4, 2017, we provided fairness related comments regarding the conduct of one on one meetings in response to questions from the Contracting Authority. No fairness deficiencies were identified.

On January 10, 2017, we reviewed Amendment 1 to LOI 2 (Document 3) which provided a copy of the presentation slides that would be presented at the plenary session. No fairness deficiencies were identified.

On January 12, 2017, we observed the industry day plenary session and one on one meetings with interested firms. Fairness related comments were made and appropriate action was taken by project officials.

On February 16 and 20, 2017, we reviewed a draft version of the Statement of Invitation to Qualify (SOIQ) and provided fairness related comments to the Contracting Authority. Appropriate action was taken by the Contracting Authority. On April 26 and May 3, 2017, we reviewed a revised draft version of the SOIQ, now entitled an Invitation to Qualify (ITQ), and provided fairness related comments. Appropriate action was taken by project officials

On July 16, 2017, we reviewed an updated draft ITQ. No fairness deficiencies were identified.

5.2 Fairness monitor activities and findings related to the invitation to qualify stage

On July 25, 2017, we reviewed the ITQ as posted on buyandsell.gc.ca (Document 4). On August 2, 2017 we reviewed a draft version of Amendment 1 to the ITQ and on August 14, 2017 we reviewed a draft version of Amendment 2. Fairness related comments were provided. On August 9, 2017 and August 15, 2017, we reviewed the posted versions of Amendment 1 (Document 5) and Amendment 2 (Document 6) respectively to the ITQ. No fairness deficiencies were identified.

The ITQ closed on September 5, 2017.

On August 30, 2017, we reviewed a document that the Contracting Authority intended to forward to the members of the evaluation team. The document outlined the rules for evaluation and the responsibilities of each member of the team. On September 7, 2017 we observed an orientation meeting of the evaluation team during which evaluation rules and responsibilities and the evaluation process were described by the Contracting Authority. Copies of the responses to the ITQ were distributed to the evaluation team. Fairness related comments were provided and appropriate action was taken by the Contracting Authority.

On September 19, 2017, we observed the evaluation of the ITQ responses. Fairness related comments were provided and appropriate action was taken by the Contracting Authority and the evaluation team.

All of the four responses met the qualification requirements.

5.3 Fairness monitor activities and findings during the qualified bidders’ engagement stage

On November 13, 2018, we reviewed planning for an upcoming Industry Day and one on one meetings with the qualified bidders. On November 21, 2018, we observed the Industry Day session where the four Qualified Bidders were present. Presentations provided included the procurement process and planned schedule, a description of the services to be contracted, the categories of the services, the Halifax-Class engineering change process, the margin management system, and the integrated data environment architecture. No fairness deficiencies were identified.

On November 22, 23, and 24, 2018, we observed one on one meetings with the four Qualified Bidders. Each bidder controlled the agenda for its one on one meeting with each outlining its related experience, suggestions, and concerns. Fairness related comments were provided and appropriate action was taken by project officials.

On May 1, 2019, we reviewed planning for a new series of one on one meetings with the Qualified Bidders. The four Qualified Bidders had been provided with a draft Request for Proposal (RFP) and the purpose of the meetings was to obtain their comments and suggestions for improvement. In addition to the one on one meeting, each bidder could submit written comments subsequent to the meeting.

On May 9, 10, and 13, 2019, we observed four one on one meetings. Each bidder controlled the agenda within the same time allocation. Each bidder presented their comments and suggestions on the draft RFP and project officials asked clarification questions to confirm understanding. Fairness related comments were provided and appropriate action was taken by project officials.

On May 29, 2019, we met with project officials and reviewed the evaluations criteria. Fairness related comments were provided and appropriate action was taken by project officials. During the period June 17 to 20, 2019, we reviewed a draft of the RFP and provided fairness related comments to the Contacting Authority. Appropriate action was taken by project officials

5.4 Fairness monitor activities and findings during the request for proposals stage

On September 12, 2019 we reviewed the RFP (Document 7) that had been forwarded to the qualified bidders on August 12, 2019. We had previously reviewed several draft versions of the RFP during the Qualified Bidders Industry Engagement stage. No fairness deficiencies were identified with the formal RFP that was released on August 12, 2019.

Just prior to the dates on which the amendments were forwarded to the qualified bidders as noted under Reference Documents on the last page of this report, we reviewed Amendments 1, 2, 3 and 4 (Documents 8, 9, 10 and 11). We also reviewed the amendments as forwarded to the qualified bidders. No fairness deficiencies were identified.

On October 30 and November 13, 2019, we provided fairness related comments to the Contracting Authority in response to several evaluation process questions. No fairness deficiencies were identified.

The RFP closed on December 5, 2019. Three proposals were received.

5.5 Fairness monitor activities and findings during the proposal evaluation stage

On December 2, 2019, we observed the evaluator’s training orientation session. The evaluators were given an outline of the RFP, the evaluation process that would be followed, their evaluation responsibilities, general evaluation rules along with a general schedule. Fairness related comments were provided and appropriate action was taken by project officials.

On January 7, 13, 20, and 27, 2020, we observed evaluation consensus meetings during which consensus agreements on all mandatory requirements and consensus scores for all technical rated requirements were agreed. Each evaluator was given a full opportunity to provide their views and a consensus score was agreed after a discussion. Well established practices were followed. Fairness related comments were provided and appropriate action was taken. No fairness deficiencies were identified.

On January 29, 2020 we observed a presentation to the management at which the results of the technical evaluation were presented. The names of the bidders were anonymized and the real names were not provided. Questions were asked to verify that the evaluation process specified in the RFP had been followed and that the scores were justified. No fairness deficiencies were identified.

On February 4, 2020 we reviewed the financial proposal evaluation process and the results that had been tabulated with the Contracting Authority. The financial evaluation process was as specified in the RFP and used a spreadsheet. The spreadsheet had been independently double-checked by a colleague of the Contracting Authority. We conducted a spot check of the spreadsheet including the tabulation of both technical and financial results that applied the basis of selection to identify the responsive bid with the highest combined technical and financial score. No fairness deficiencies were identified.

6. Reference documents

The following documents are referenced by number in this report. These documents are available through the HcDAgent project office.

7. Addendum to final report, December 10, 2020

Addendum to fairness monitor final report dated September 12, 2020, Halifax class design agent services

This Addendum to the FM Final Report covers activities undertaken after we reviewed with the Contracting Authority the basis of the selection of the recommended bidder that had achieved the highest combined technical and financial score on February 4, 2020.

We were advised on March 26, 2020, that a Contract had been awarded to the recommended bidder.

Also on March 26, 2020, we reviewed by telephone with the Contracting Authority the proposed wording of the regret letters to the unsuccessful bidders informing them of the results of the procurement process. The letters were forwarded to the unsuccessful bidders the same day and on June 3, 2020, we reviewed the regret letters as sent. The letters provided the value of the contract that had been awarded to the successful bidder as well as the total technical and financial scores achieved by the successful bidder and the bidder to whom the letter was addressed. No fairness deficiencies were identified

It is noted that the contract was awarded and letters drafted and forwarded to the unsuccessful bidders at the onslaught of the pandemic when travel restrictions and lock downs were put in place. While the unsuccessful bidders were invited to contact the Contracting Authority if further information was required, none has done so as of the date of this addendum. This addendum has been delayed pending the receipt of a request for a debriefing but it is looking increasingly likely that none will be forthcoming. Even though the normal period for requesting a debriefing has long expired, the Contracting Authority intends to honour any such request. If such a request is received a revision to this addendum will be prepared.

Fairness monitoring attestation of assurance

It is the professional opinion of the FM that the post evaluation activities were carried out in a fair, open and transparent manner.