Public Interest

In Canadian federal procurement, public interest refers to the public good, meaning the interests of Canadians. It is most often used where an urgent public need, national security, health and safety, public security, or a significant economic or financial effect is at stake.

The term carries legal weight. The Government Contracts Regulations use it to allow a contracting authority to skip competitive bidding when delay would be injurious to the public interest, or when the nature of the work makes soliciting bids contrary to the public interest. The same term appears in procurement policy, supplier-integrity procedures, and non-competitive contracting decisions.

How the Government Contracts Regulations use public interest

The federal procurement objective is to enhance access, competition and fairness while achieving best value, the optimal balance of benefits to the Crown and Canadians. Competitive bidding is the default way to meet that objective. Public interest appears in the exceptions to that default, as set out in Treasury Board Secretariat policy guidance.

Two exceptions rely on the term:

• Pressing emergency: a contract may be awarded without competitive bids when delay would be injurious to the public interest.
• Nature of the work: a contract may be awarded without competitive bids when the nature of the work makes it contrary to the public interest to solicit bids.

Federal procurement guidance gives emergency evacuation boats as an example of a sole-source purchase justified by a pressing emergency.

Factors behind a "not in the public interest" rationale

Treasury Board guidance lists examples of factors that can support a rationale that soliciting bids is not in the public interest:

• reducing Canadian socio-economic disparity
• national security
• preserving a strategic source of supply
• restrictions tied to the International Traffic in Arms Regulations (ITAR)

These are examples of the kinds of circumstances that can justify a non-competitive approach. The exception still has to be documented and tied to the regulations.

Documentation of non-competitive contracts

A federal procurement audit states that the rationale for a non-competitive contract must be placed on file and must align with an exception in section 6 of the Government Contracts Regulations. The public-interest exceptions are among those listed. The contracting authority carries this burden, and a supplier does not trigger an exception by asserting that a purchase serves the public interest.

The Public Interest Exception for after-hours awards

Public Services and Procurement Canada (PSPC) also uses the term in its supplier-integrity regime. A Public Interest Exception (PIE) allows PSPC to award a contract or real-property transaction in certain after-hours situations to a supplier on the public Ineligibility and Suspension List. PSPC's after-hours integrity directive identifies the reasons that may support a PIE:

• emergencies
• health
• national security
• safety
• public security
• economic or financial well-being

What public interest means for a supplier bidding on Canadian public contracts

Suppliers should treat public interest as a narrow exception to competition, not a selling point. If a department pursues a non-competitive contract on this basis, it must document and justify the exception. When asked, a supplier can help by providing evidence on urgency, capability, security, safety, or other relevant facts. Suppliers with a strategic capability, such as a secure or sole source of supply, should be able to show clearly how it relates to the factors above. Suppliers on the Ineligibility and Suspension List should know that a PIE is available only in defined after-hours situations and only for the reasons PSPC sets out.