What we examined (see Focus of the audit)

In October 2011, the Government of Canada announced construction of a new bridge to replace the existing Champlain Bridge, which links the Island of Montréal with the south shore of the St. Lawrence River.

The existing bridge was less than 50 years old, but it had deteriorated badly. Heavy investments were required to repair and maintain it. If a structural problem forced the bridge to close, the four other river crossings in the area could not accommodate the displaced traffic without significant congestion. Even partial closures for brief periods or load restrictions could significantly affect the flow of people and goods through the region, and also affect the economy.

This audit focused on whether Infrastructure Canada managed selected aspects of the new Champlain Bridge project to meet the objective of delivering a durable bridge on time and in a cost-effective manner.

Why we did this audit

This audit is important because the existing Champlain Bridge is a lifeline for residents and businesses in the Greater Montréal area. It accommodates close to 50 million of the 200 million river crossings recorded in the area each year. It also facilitates the movement of imports and exports through the area, with an estimated value of $20 billion every year.

What we concluded

We concluded that Infrastructure Canada did not plan the replacement of the existing Champlain Bridge in a cost effective manner.

We also concluded that Infrastructure Canada did not adequately manage selected procurement risks to mitigate cost overruns and delays. Moreover, the private partner’s ability to meet the revised completion date of 21 December 2018 remained uncertain. With respect to the bridge’s durability, the Department had no assurance that the new bridge would meet the expected service life of 125 years at the time it signed the contract with the private partner. However, from our examination of certain components, we found no evidence that the bridge would not last the expected service life.

What we found about…

Planning for the replacement of the existing Champlain Bridge

Overall, we found that the Government of Canada was slow in making the decision to invest in a new bridge instead of maintaining the existing one. This finding matters because the delay in decision making entailed avoidable expenditures of more than $500 million, apart from the economic costs to the Greater Montréal area due to the congestion and load limitations on the existing bridge.

We also found that Infrastructure Canada completed its analysis of the procurement models for the new Champlain Bridge project two years after it announced the choice of a public-private partnership model. If the Department had thoroughly analyzed the procurement models for the project, it would have found that the public-private partnership could be more expensive than a traditional model.

• Delays in decision making added to the overall costs

  Recommendation. To avoid service disruptions and unnecessary expenditures, Infrastructure Canada should analyze the life cycle costs of the infrastructure assets in its portfolio and plan effectively for timely replacements.

• The decision to proceed with a public-private partnership was based on incomplete information and analyses

  Recommendation. Before deciding which procurement model to adopt for future large infrastructure projects, Infrastructure Canada should

  • analyze the key project-specific aspects when conducting a qualitative analysis and evaluate their costs;
  • use best practices, sound assumptions and evidence-based data from relevant past projects and best practices to better evaluate the risks and assumptions used in the value-for-money analysis; and
  • perform a sound sensitivity analysis to inform decision makers about the variability of expected costs and benefits.

  Recommendation. After completing the construction of the new Champlain Bridge, Infrastructure Canada should create realistic benchmarks for construction costs, risk evaluation, and efficiency rates in value-for-money analyses, for use in future requests for proposals for infrastructure projects.

Management of procurement risks

Overall, we found that Infrastructure Canada evaluated the technical proposals for the construction of the new Champlain Bridge project consistently and fairly. However, the evaluation approach had some flaws. The Department did not sufficiently account for important technical evaluation criteria. Moreover, bidders did not have to demonstrate that they met them.

Furthermore, after awarding the contract, Infrastructure Canada made several changes to the project, some of them major, to respond to the needs of surrounding communities and stakeholders. The negotiations on these changes, which were ongoing at the time this report was published, have been time-consuming.

In our view, the private partner will not deliver the new Champlain Bridge within budget. In addition, the delivery of the new bridge on time appears very challenging.

• Infrastructure Canada’s approach for evaluating the technical proposals exposed it to risks

  Recommendation. When evaluating proposals for public-private partnership contracts under its responsibility, Infrastructure Canada should develop an evaluation approach that includes

  • Specifying the appropriate weights and minimum scores for assessing important technical project requirements, and
  • requiring bidders to provide analysis or evidence that their proposals meet all critical technical requirements.

• Costs for the new bridge were higher than planned

  Recommendation. In future public-private partnership projects, Infrastructure Canada should minimize the number of project changes and approve them in a timely manner, to reduce the risk of cost overruns and delays.

Entity Responses to Recommendations

The audited entity agrees with our recommendation(s) and has responded (see List of Recommendations).

Related Information

Report of the	Auditor General of Canada
Type of product	Performance audit
Topics	Financial Management and Government Spending Real Property Transportation
Entities	Infrastructure Canada
Completion date	18 December 2017
Tabling date	29 May 2018

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