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Tenth Annual Report of the Purchasing Commission January 1st, 1952, to December 31st, 1952 British Columbia. Legislative Assembly 1953

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 PROVINCE OF BRITISH COLUMBIA
Tenth Annual Report of the
Purchasing Commission
January 1st, 1952, to December 31st, 1952
VICTORIA, B.C.
Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty
1953 . .        . Victoria, B.C., February 2nd, 1953.
To His Honour Clarence Wallace, C.B.E.,
Lieutenant-Governor of the Province of British Columbia.
May it please Your Honour:
Herewith I beg respectfully to submit the Annual Report of the Purchasing Commission of the Department of Finance for the period January 1st, 1952, to December
31st, 1952.
E. M. GUNDERSON,
Minister of Finance.
The Honourable E. M. Gunderson,
Minister of Finance, Victoria, B.C.
Sir,—We have the honour to submit the Tenth Annual Report of the Purchasing
Commission, covering the period January 1st, 1952, to December 31st, 1952.
R. H. SPECK,
Chairman.
R. M. BURNS,
Member.
C. D. CAMPBELL,
Member.  Tenth Annual Report of the Purchasing Commission
For the Year Ended December 31st, 1952
■
This is the third Annual Report of the present Commission since it took office on
April 1st, 1950. The first year was one of investigation and study of methods and procedures; the second, one of reorganization; while the past year has been a year devoted
to consolidation of the gains made and to further progress in the building up of an
efficient organization in keeping with the ever-increasing demands of government in an
expanding Province.
The changes made in 1952 have been by no means as evident as in 1951, but they
have all been part of the general pattern laid down in the recommendations of the
management engineers who investigated the operations of the Commission in 1950. In
certain instances, recommendations have been varied or met only in part where the
Commission has found from its experience that conditions were not entirely suited to full
implementation.
The methods of requisitioning, purchasing, and payment having been formalized,
attention has been devoted to improving the standards of performance. It is now possible to issue a " rush " order in a matter of minutes, while the standard requisition will
normally have a purchase order issued against it in two to three days from its receipt or
the closing date for tenders or quotations. Vouchers are generally processed for payment
within the same period unless special circumstances cause delay. Every effort is made
to give the fastest possible service consistent with efficiency.
It has been quite obvious to the Commission that the situation regarding specifications and standards has never been satisfactory. It has not been easy to arrive at a
workable solution as in many lines accepted standards do not exist, while in others they
are not suited to our requirements. It is difficult to ask suppliers to quote on other than
common commercial qualities unless the order is of sufficient size to warrant the special
attention. In addition, the preference of operating officials for specific " name brands "
must often be given consideration. Progress, while slow, is being made steadily and we
have every confidence of ultimate success to the benefit of all concerned.
Further advance is being made in inventory control and a standard system has been
set up for operating departments where the problem is a minor one. In major inventory
problems special endeavour has been made to adjust our basic requirements to the individual situations that exist. It is not the intention of the Commission to take over the
control of departmental stores. The requirements of control can most economically and
efficiently be served by up-to-date standards and a system of inspection to see that these
are being followed. Due to the numerous small stores in existence and their wide dispersion, the problem is not one of immediate or simple solution.
Further improvement has been made in servicing furniture and office equipment.
The Business Machine Service Division is now one of the best trained and equipped in
the Province and now services and overhauls nearly all types of office equipment, other
than certain complicated calculators and book-keeping machines. The maintenance of
office furniture has also been given further attention. Generally, the standard of equipment in government offices is now up to accepted modern requirements and most obsolete
units that accumulated in the years of short supply have been replaced. The Commission
has continued its policy of scrutinizing carefully all requisitions and has had some success
in reducing requirements to the most economic level. Inventories of furniture and equipment have been revised, and it is intended that surplus requirements be redistributed from
time to time, but in this the full co-operation of departments must be forthcoming. GG 6 BRITISH COLUMBIA
At the present time the Purchasing Commission acts on behalf of all branches of
government, exclusive of certain quasi-independent Boards and Commissions. As mentioned in the 1951 report, circumstances have dictated special treatment for the Queen's
Printer, Text-book Branch, and libraries. The report of the management engineers on
these branches now being available, the Commission is considering ways and means of
adapting the procedures in these branches to the general system of government purchasing
as recommended in the said reports.
During the past year, prices have remained more or less static with some slight
declines, particularly in certain food lines. The fall in prices, as indicated by wholesale
price indices, has been reflected only to a limited extent as yet in the prices of finished
products, due probably in some measure to rises in transportation and labour costs and
continued active consumer demand. Most products have been in good supply and some
of the anticipated shortages in metals, such as steel and copper, which looked potentially
serious a year ago, have not materialized except in a few specialized lines.
The Commission has continued its established policy of giving preference to products
made in British Columbia and to local supplies where quality is equal and the price
differential reasonable. While this policy is sound, it should not be forgotten that it is
a form of subsidization at the public expense and as such must be carefully controlled.
The question is not a simple one for many suppliers who do not actually produce in the
Province are large employers of labour and are substantial taxpayers. Further, the whole
question of reciprocal trade is involved, for many of our producers in this Province are
dependent on outside markets, and it is an economic truism to point out that he who sells
must be prepared to buy.
The past year has been one of continued progress and it is the feeling of the Commission that while much still remains to be done a very fair measure of success has been
achieved. Continued, and in many cases improved, co-operation has been received from
departments, and our relations both within and without the Service are generally excellent. Much credit must be given to the staff, and particularly to those buyers and those
section heads who have devoted much thought and effort to the improvement of the
service rendered and to the conservation of public funds.
STATISTICAL RECORDS
Statistical records were maintained under the following headings, which, for information, are recited herewith:—
A. Competitive.—On  contract,  quotation   (written  or  verbal),  or prices
awarded on, and governed by, previous quotation.
B. Restrictive.—Specified commodities sold exclusively by a particular manu
facturer, wholesaler, jobber, or agent.
C. Controlled.—Includes set prices where no advantage accrues in calling for
competitive tenders on commodities sold at controlled prices.
D. Non-competitive.—Requisitions issued without stated prices and controlled
by checking or test-checking prices when invoices are submitted.
Retail.—Includes semi-retail, or where prices are greater than might be
secured from manufacturer or wholesale (local purchases).
F.
Emergency,-
-(1) Retail.
(2) Wholesale.     .
■ REPORT OF THE PURCHASING COMMISSION
GG 7
Comparative figures for the fiscal years 1948-49 to 1951-52 are set forth hereunder:—
1948-49
1949-50
1950-51
1951-52
(Residual)
A. Competitive	
B. Restricted	
C. Controlled	
D. Non-competitive..
E. Retail 	
F. Emergency—
(1) Retail 	
(2) Wholesale	
War Assets Corporation-
Totals 	
$2,390,495
4,539,397
1,976,648
3,400,000
153,048
310,000
620,584
23,375
$2,559,522
4,076,441
879,601
4,025,594
233,043
274,451
788,211
$3,864,870
3,347,926
931,224
2,770,719
178,460
225,886
694,309
$154,457
55,888
20,693
54,068
116
$13,413,547      |    $12,836,863
$12,013,394
$285,222
Number of purchase orders issued-
33,315
37,306
37,221
U)
1 Included below.
From April 1st, 1951, a new classification system was adopted, as follows:—
A. Competitive.—Purchases from manufacturers and wholesalers which are
placed on a basis of competitive quotes on prices, including those
purchases made on the basis of information obtained from unit price
cards.
B. Restricted.—Purchases from manufacturers or wholesalers for which unit
prices are fixed, or for some special condition of source of supply the
buyer is limited to one supplier.
C. Retail.—All purchases from retail establishments including retail emer
gency purchases.
D. Wholesale Emergency.—Orders placed with a wholesaler or manufacturer
by means of emergency purchase order.
Apr. 1,1952, to
1951-52 Dec. 31, 1952
A. Competitive
B. Restricted .__
C. Retail 	
D. Wholesale Emergency
$7,932,525
2,917,961
377,385
516,787
Totals  $11,744,658
Purchase Orders issued
42,805
$9,513,458
1,109,682
322,117
526,965
$11,472,222
31,030
It is an indication not only of the increasingly competitive position of the markets
but of the continued success of the Commission's policy that competitive orders in
1951-52 made up 68 per cent of the total as against less than 20 per cent in earlier years.
This continued success is further illustrated by the fact that in the first nine months of
1952, 83 per cent of the orders issued were on a competitive basis. All this involves
increased internal processing and some administrative expense, but there would seem to
be no doubt that this trend results in a substantial saving of public funds.
VICTORIA, B.C.
Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty
1953
245-253-9705 .

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