Finance Minister Rod Phillips says Ontario is adopting smart initiatives to save money. © Toronto Star/Getty Images
Finance Minister Rod Phillips says Ontario is adopting smart initiatives to save money. © Toronto Star/Getty Images

Ontario aims to save $1bn with procurement shake-up

26 November 2019

The Government of Ontario has introduced a bill to regulate supply chain management activities in the public sector. 

The bill aims to ensure government and broader public sector, including  the health sector, carry out supply chain management according to centralised regulations including “specified vendor performance standards and practices”.

This follows the government’s plan to build a “modern, centralised procurement system”, announced in March, which it is estimated will save $1bn annually by streamlining processes and bringing together contracts across the public sector.

The proposed Supply Chain Management Act aims to combine public sector buying power and create a framework to regulate the procurement of goods and services.

It also permits the lieutenant governor in council, Elizabeth Dowdeswell, “to designate or create a supply chain management entity to provide or support supply chain management on behalf of other entities.”

The 2019 Ontario Economic Outlook and Fiscal Review: A Plan to Build Ontario Together commits the government to balancing the budget by 2023-24 by spending efficiently and investing in critical public services. The government is on track to reduce the deficit from $10.3bn to $9bn for 2019-20.

Finance minister Rod Phillips said: “We know inefficient and outdated processes mean government cannot easily respond to the needs of the people we serve. That’s why we have a plan to make government smarter.

“We are adopting smart initiatives like a digital first approach to help save money and deliver services more conveniently. We are centralising procurement, which will drive an estimated savings of $1bn a year. 

“Our government is also establishing a new Value Creation Task Force to identify opportunities to generate new, recurring, non-tax revenue streams. This new revenue will be re-invested back into core public services, like health care and education.”

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