Vendor Performance Corrective Measures

Vendor Performance Corrective Measures (VPCMs) are formal measures used by Public Services and Procurement Canada (PSPC) when evidence indicates that continuing to contract with a supplier presents an unacceptable risk to Canada. They are set out in PSPC's Vendor Performance Corrective Measure Policy, which is administered for the PSPC procurement community.

The purpose of a VPCM is to mitigate performance risk in future PSPC contracts. It is applied after other performance-management mechanisms, such as contract-performance action or a remedial plan, have not produced sufficient correction. The policy deals with performance risk. Broader supplier-integrity risks fall under the separate Ineligibility and Suspension Policy.

When PSPC can impose a corrective measure

A VPCM may be imposed after a major performance failure, such as a termination for default or a conditional amendment. It may also follow a cumulative record of such incidents. In either case, the test is whether continued contracting with the supplier would pose an unacceptable risk to Canada. PSPC's misconduct and wrongdoing reporting page describes the same triggers.

The policy describes performance impacts as Minor, Medium or Major, based on the effect of the supplier's performance on government operations. An assessment does not automatically result in a corrective measure.

Debarment and conditions

The Office of the Procurement Ombudsman identifies two forms of corrective measure on its resolution page:

• Debarment: a refusal to do business with a supplier for a specified period. A debarred supplier is ineligible to bid on contracts, standing offers and supply arrangements.
• Conditions: requirements imposed on future business, such as additional financial security.

How the assessment and supplier response work

The Contracting Authority conducts the VPCM assessment, supported by the Technical Authority. The assessment examines the performance evidence, the seriousness of the issues and whether a corrective measure is warranted. The steps are laid out in the CanadaBuys process page.

A supplier affected by a proposed measure has an opportunity to respond. According to the Office of the Procurement Ombudsman, the supplier has 15 days to respond in writing after being notified of the assessment results. It may also request to present its case verbally to the senior official.

Where a VPCM affects bids across departments

The CanadaBuys policy overview states what happens when a supplier is subject to a relevant VPCM:

• No negotiation is initiated and no offer is accepted for a sole-source contract.
• Offers for competitive goods or services procurements are rejected.
• Offers for standing offers for goods or services are rejected.
• Offers for supply arrangements are rejected, including bids for contracts under supply arrangements where PSPC's procurement authority is the contracting authority.

Other departments reference the measures in their own terms. Immigration, Refugees and Citizenship Canada allows Canada to reject a competitive bid when the bidder, or an employee or subcontractor included in the bid, is subject to a VPCM that makes that person ineligible. See its competitive requirements terms and its non-competitive requirements terms. Natural Resources Canada applies the same restriction to bidders, key personnel and subcontractors in its Energy Performance Contract Qualified Bidders List requirements.

What this means for a supplier bidding on Canadian public contracts

A VPCM can remove a supplier from competitions, sole-source awards, standing offers and supply arrangements. Because some departments extend the restriction to employees and subcontractors named in a bid, check the status of every party on your team before you submit. If PSPC notifies you of an assessment, the 15-day written response window is your opportunity to present your case, so prepare your evidence and decide early whether to ask for a verbal presentation to the senior official.