Province hands Bell MTS contract extension

Hey there, time traveller!
This article was published 22/09/2020 (1458 days ago), so information in it may no longer be current.

The Pallister government is spending $37.5 million to extend a data network contract with Bell MTS for 2 1/2 years — at terms significantly richer than the original deal.

Earlier this month, the Free Press revealed the Tory government led by Premier Brian Pallister had discouraged Manitoba Hydro in January from bidding on the lucrative Manitoba Network contract coming up for renewal at the end of June.

The Crown corporation had considered bidding on the contract, which provides interoffice data connectivity to more than 600 provincial offices, through its subsidiary, Manitoba Hydro Telecom. Hydro documents obtained through freedom of information pegged the annual value of the contract at $12 million to $14 million, or more.

According to information posted on the government’s contract disclosure web page, the original 10-year deal with Bell MTS was worth $124.3 million. The recent extension, from July 1, 2020 to Dec. 31, 2022, brings the deal’s total worth to $161.8 million. The extension is worth $15 million a year, compared with an average of $12.4 million previously.

Although provincial officials have confirmed the contract extension granted to Bell MTS was done without a competition, the deal is still listed on the provincial website as a tendered contract that was competitively sourced — presumably because the original was.

Manitoba NDP Leader Wab Kinew said the wording in the public disclosure is misleading.

“The statement in the disclosure that the contract was competitively sourced does not match up with what we’ve been told,” he said Tuesday.

“I have been told by people with direct knowledge of this deal that there was no provision for an extension in the original contract that was signed. So this (the extension) was not tendered.”

Local small and medium telecommunications and internet service providers could have piggybacked on a Hydro bid on the Manitoba Network contract. They were disappointed at missing out at an opportunity for spinoff business from the contract.

Informed Tuesday of the value of the Bell MTS contract extension, the Coalition of Manitoba Internet Service Providers (C-MISP) said the bump in provincial funding under the new deal demonstrates it is not simply an extension.

“The contract numbers have been completely reworked behind the scenes without a tender,” C-MISP said in a statement.

Hydro documents show Treasury Board secretary Paul Beauregard, a former executive with both Manitoba Telecom Service Inc. and BCE/Bell Canada, was the senior government official who informed Manitoba Hydro it was not to bid on the data network contract coming up for renewal.

Kinew said Beauregard’s involvement in the process continues to raise concerns.

“We have very serious questions about the process and the lack of tendering, which, to me, means that the questions of conflict of interest must be answered,” he said.

The government has said it is incorrect to state Manitoba Hydro was forbidden from bidding on the Manitoba Network contract.

It said the reason the deal was extended was “strictly due to timing and the fundamental change in what Manitoba may need from the Manitoba Network in the wake of the COVID-19 pandemic.”

larry.kusch@freepress.mb.ca