Open tendering for Toronto could save $347 million: Cardus
Fair and open contract bidding will free up money for police, mental health, and housing
Major crimes are up 20 percent in Toronto compared to 2022. TTC stabbings, sex crimes, break-ins, and a drug crisis have shocked city residents. Non-partisan think tank Cardus released a new research brief to help councillors and the city’s next mayor find the funds to address these priorities: Better Choices for Toronto: Finding Money in Open Tendering for Safety and Mental Health.
Cardus’s research brief outlines how Toronto could save $347 million by reducing its infrastructure construction costs, even while maintaining its current pace of construction. Those savings would be enough to cover the costs of four major steps to building a safer city:
- Hire up to 400 new police officers
- Build up to two new police stations
- Fund up to 400 new mental health managers
- Double the city’s housing and shelter construction budget
Toronto could afford these measures by opening construction contract bidding to all qualified builders.
Right now, that’s not what happens. Toronto is the only city in Ontario that restricts bidding on construction contracts to companies whose workers belong to a select group of favoured unions. If workers belong to a different union, or they’re non-unionised, their employer can’t bid. Fewer bidders means less competition, which leads to higher prices.
Better Choices for Toronto: Finding Money in Open Tendering for Safety and Mental Health outlines the experience of the City of Hamilton, which ended its cozy deal with favoured unions in 2019. City officials there estimated they could save an average of 21 percent in construction costs because of that one move.
In Toronto, an estimated $1.65 billion in construction is reserved for companies whose workers belong to a group of favoured unions. A 21 percent discount in Toronto would mean the city would have $347 million dollars more available to invest in police, mental health, and housing.
“Outdated construction contract bidding rules mean Toronto residents pay more to get less,” says Renze Nauta, work and economics program director at Cardus. “The choice to cut a special deal for some unions means city residents are missing the opportunity to build a safer city.”
Read Better Choices for Toronto: Finding Money in Open Tendering for Safety and Mental Health on the Cardus website.