POLITICS EXCLUSIVE: B.C. let its bridge rep review own invoices

Published in Metro News | Sept. 28, 2016

The Port Mann bridge between Surrey and Coquitlam cost taxpayers $3.3 billion, significantly more than its original $2.4-billion “fixed-price” contract. Photo: Jennifer Gauthier

The Port Mann bridge between Surrey and Coquitlam cost taxpayers $3.3 billion, significantly more than its original $2.4-billion “fixed-price” contract. Photo: Jennifer Gauthier

Some might say the $3.3-billion Port Mann Bridge between Surrey and Coquitlam is a “bridge over troubled water.”

Touted by B.C. as “the largest transportation infrastructure project in British Columbia’s history,” it cost significantly more than its original $2.4-billion “fixed-price” contract.

The project’s proverbial waters are being troubled again by questions about an accounting firm partner who oversaw a review into the Port Mann’s “invoicing process” — a process he’d overseen months earlier in a previous job for the Transportation Investment Corporation (TI Corp.), the Crown corporation B.C. created to implement the Port Mann/Highway 1 project, according to court documents.

In September 2009, KPMG was hired to “review a contractor’s invoicing process on a major British Columbia highway project” of TI Corp., a B.C. Supreme Court judge ruled in a 2012 decision in a KPMG contractor’s wrongful dismissal case.

In the two weeks between the project contract’s signing on Mar. 17, 2009 and TI Corp.’s March 31 year-end, it spent $97.9 million on “work done” under the design-build contract.

Metro was unable to independently confirm which Port Mann “invoicing process” KPMG reviewed, nor the review’s outcome.

But the Supreme Court ruling did confirm that the senior KPMG partner tasked with overseeing the review was engineer Gary Webster, head of KPMG’s Global Infrastructure and Projects Group.

“Gary Webster, a KPMG partner, had oversight over the project,” the judge noted.

Engineer Gary Webster moved from CM2H Hill — where he served as B.C.’s representative on the Port Mann project — to accounting giant KPMG in August 2009, according to his resume.

Webster had moved to KPMG just a month earlier from CH2M Hill where he was the private sector contractor TI Corp. hired to oversee taxpayers’ expenses on the bridge in the first place, according to his LinkedIn resume and corroborated by other publicly available documents.

He’s named as the Authority’s Representative in the contract between TI Corp. and partners Kiewit and Flatiron:

“Authority’s Representative means Gary A. Webster,” his roles listed as: “monitor the Project, and the Constructor’s performance … including the system of inspection, testing, surveys, certification, review and audits.”

KPMG partner Gary Webster’s experience is listed on his LinkedIn profile.

Webster did not respond to interview requests, and a KPMG spokesperson declined comment from him or the company due to “client confidentiality.”

There is nothing to suggest that Webster, KPMG, Flatiron or Kiewit did anything improper related to the Port Mann invoicing process, nor the $98-million spent.

“The $98 million paid in March 2009 was based on requirements of the Design Build contract with Kiewit Flatiron,” said TI Corp. spokesman Greg Johnson in an email, who told Metro the “payment went towards commencement of design, pre-purchase of materials and other work such as a pile load testing.”

He said B.C.’s Auditor General audits the Crown corporation’s annual financial statements.

However, the New Democrats’ and Integrity BC said Webster’s dual roles should set off alarms about the province essentially privatizing the oversight of taxpayer funds for its megaprojects.

“When we see the person in charge of making all the key decisions … ending up overseeing a review of those decisions, that is highly irregular,” said Integrity BC executive director Dermod Travis in a phone interview.

“I’d suspect most British Columbians would assume a public servant is in charge of all these projects.

“What we don’t see with public infrastructure projects is the public interest being represented in B.C.”

Meanwhile, the Canadian Taxpayers Federation called on the province to “re-examine its processes” and to review what can be done “to ensure its decisions are above reproach,” said its B.C. director Jordan Bateman.

“These allegations are certainly a grave concern,” he told Metro in an email. “There needs to be a clear and distinct separation between contractors and the people approving those contracts.

“Taxpayers need to have 100 per cent confidence that their money is being managed with the utmost integrity.”

NDP transportation critic Claire Travena said B.C.’s practice of having private sector contractors oversee taxpayer spending is “extremely worrying” and called for an independent review.

“Anybody reading that would be shocked by it,” she said when asked about Webster’s dual roles. “It’s extremely worrying and does speak to the real lack of oversight.

“That’s why we have the Auditor General, with the role of oversight of major projects — that’s where the oversight should be. Their role is to oversee government spending, not to bring individuals from the private sector.”

The province’s transportation minister declined an interview request, nor would the ministry comment on the KPMG review or the “invoice process” on the Port Mann project.

Spokeswoman Kate Mukasa told Metro the province is “committed to transparency and accountability,” and that TI Corp. “continues to account for its ongoing operations,” she said in an email. “In hiring KPMG, there’s an expectation that all work will meet or exceed their industry’s standards for quality, integrity and accountability.

“As we invest taxpayer dollars on vital infrastructure that keeps goods and people moving, we’re confident that our procurement process is fair, open and transparent.”

Flatiron could not be reached Tuesday; Kiewit declined an interview request, directing Metro to TI Corp.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s