Comparing and competing would improve municipal services

    MONTREAL, Sept. 18 /CNW Telbec/ - Although the municipal administration
just required budget cuts amounting to $100 million from its departments and
boroughs, it is possible to believe that Montreal could do more and, most of
all, better. Mayor Tremblay and officials in other cities could adopt two
strategies that have helped reduce the cost of municipal services outside
Quebec while enhancing their quality. In an Economic Note published by the
Montreal Economic Institute, economist Mathieu Laberge explains that "good
municipal governance includes systematic comparisons of efficiency as well as
putting services up to competitive tender with the private sector."

    Information and interview requests

    Contact: André Valiquette (see below). Tuesday September 18, 11:00 to
14:00, interviews with Mathieu Laberge, can be hold at John Norquist's
conference "Are Montrealers getting enough bang for their buck?", Hotel
Marriott Château Champlain, room Cartier, 1050, de la Gauchetiere West
(conference organised by MEI).

    Promoting initiatives for better municipal management

    Two initiatives promote good governance in municipal services and require
elected officials to give a fuller accounting: benchmarking and tendering of
municipal services to private suppliers.
    Benchmarking, already used in Ontario and Nova Scotia, consists of
gathering data for official comparisons of current practices in various cities
with provincial or national standards to identify possible improvements in the
delivery of municipal services.
    The United Kingdom has also experimented with initiatives to make the
delivery of municipal services more efficient. The first stage took the form
of competitive compulsory tendering, guaranteeing equal commercial conditions
for private and public suppliers. This model is thought to have helped
generate average savings of 6.5% in the first wave of tendering and 9.1% in
the renewal of initial contracts.
    Later, the "best value" mechanism aimed to optimize delivery of municipal
services by using the most efficient suppliers. This approach does not presume
that municipal services must necessarily be provided by the local public
administration if there exist other, more efficient mechanisms such as
    It is important for Quebec to catch up on its accumulated delay in
evaluating municipal efficiency, especially compared to Ontario, which has
been working at it since the 1980s. Quebec's municipal affairs department has
gathered management indicators from municipalities since 2004 with the aim of
improving performance but without integrating indicators from parties
independent of municipal structures.

    Obstacles can be overcome

    An investigation conducted in 2005 among 217 Canadian municipalities
found that nearly two-thirds of the municipalities surveyed had examined the
possibility of using the private sector to provide services and 78% saw this
as a way of reducing costs. The investigation also revealed the most frequent
objections to using private suppliers: opposition from municipal employees
(63% of municipalities), restrictive collective agreements or labour contracts
(55%), a shortage of capable service providers (31%) and the absence of an
adequate mechanism for monitoring the execution of contracts (27%).
    Other studies show that all cities and towns facing these difficulties
overcame fears by consulting municipal administrators and having them
participate in the development of these projects.
    The Economic Note titled Comparing and competing to improve municipal
services was prepared by Mathieu Laberge, an economist with the Montreal
Economic Institute and holder of a master's degree in international economics
and econometrics from the University of Nottingham.
    The Note is available at WWW.IEDM.ORG.

    The Montreal Economic Institute is an independent, non-partisan,
non-profit body that takes part in public policy debate in Quebec and across
Canada, offering wealth creation solutions on matters of taxation, regulation,
and reform of health and education systems. Its publications since 2000 have
included the Report Card on Quebec's Secondary Schools. In 2004 it won a
Templeton Freedom Award for Institute Excellence for the quality of its
management and public relations.

For further information:

For further information: André Valiquette, Director of Communications,
Montreal Economic Institute, (514) 273-0969, ext. 2225, Cell: (514) 574-0969,

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