$1M in untendered contracts tied to top health official

Tuesday, November 10, 2009 | 9:19 PM ET
The Canadian Press

Untendered contracts totalling $1 million were awarded by the province to a consulting firm whose top executive was later appointed as one of the government's top health bureaucrats, The Canadian Press has learned.

Helen Stevenson, the assistant deputy minister and executive officer of Ontario's Public Drug Programs, was hired as a consultant in 2005 by the Health Ministry when she was president of Savattuq Inc., a government spokesman confirmed late Tuesday.

Between June 2005 and June 2007, the government gave Savattuq three sole-sourced contracts totalling just over $1 million, according to the provincial public accounts.

Stevenson was hired, in her capacity as a consultant, to head up the province's drug system secretariat, whose purpose was to develop and implement new strategies to manage the province's drug costs, said Health Ministry spokesman David Jensen.

More specifically, the secretariat was charged with producing a "plan of action" that would set directions for the province's drug system, including the Ontario Drug Benefits Program, over five to 10 years, Jensen said in an email.

The three contracts to Savattuq were sole-sourced "given the urgent need to move forward with transformational changes to the drug program," he said.

Those changes led to legislation — the Transparent Drug System for Patients Act — which has saved the province almost $700 million over two years, he said.

Contracts allowed at the time, government says
At the time, untendered contracts were permitted, Jensen said.

Premier Dalton McGuinty changed those rules recently after millions in untendered contracts at eHealth Ontario were brought to light.

Stevenson was appointed assistant deputy minister on June 14, 2007, after an open competition, and took over the executive director job from deputy minister of health Ron Sapsford, Jensen said.

The contract with Stevenson, who makes $275,717 a year in her current job plus $473.28 in benefits, was cancelled after her appointment, he said.

Ivan Langrish, a spokesman for Health Minister Deb Matthews, acknowledged that the contracts were sole-sourced.

"I think it's actually really a good thing," he said.

"We took someone basically from the private sector, had them then join the public sector to undergo basically a transformation of our drug strategy and look what we've managed to do. What we've managed to do is save some $700 million."

News of this latest untendered contract comes in the aftermath of a spending scandal over electronic health records at eHealth, where millions of dollars went out the door in untendered contracts.

The government is also looking to cut costs in an effort to tame a projected $24.7 billion deficit this year — the largest in the province's history.

NDP pans consultant 'addiction'
The Savattuq contracts and Stevenson's promotion raise serious questions about whether the governing Liberals are hiding a secret agenda to slash drug benefits, said NDP Leader Andrea Horwath.

The government is still concealing an untendered, $750,000 report by McKinsey & Co. into cost-cutting for generic drugs, which could end up cutting drug benefits to seniors and welfare recipients, Horwath said.

"It seems to me that it's just another example of this addiction that the government has to hiring consultants," Horvath added.

Langrish insists the government isn't looking to cut drug benefits with the McKinsey report.

"It has nothing to do with that," he said. "It's really trying to reduce the costs of generic drugs, reducing those costs as much as we possibly can because we're paying too much for drugs here."

The governing Liberals may think the Savattuq contracts were good value for money, but taxpayers are tired of seeing them bend the rules, said Progressive Conservative health critic Christine Elliott.

"Everything in health can presumably be said to be urgent because there are many pressing matters," she said.

"But the rules still need to be followed. The end doesn't justify the means."

Matthews has declined to make the McKinsey report public, saying the gist of its findings can be found on slides posted on the her ministry's website.

Those are based on a July presentation by Sapsford, which talks about delivering value for money in the provincial drug system, but makes no reference to McKinsey or the agency's recommendations.

A call to Stevenson's office for comment was not immediately returned Tuesday


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