Ontario Public Sector Procurement Prioritizes Ontario Businesses

Ontario has taken a significant step to bolster its local economy by prioritizing Ontario businesses in public sector procurement processes. Effective April 1, 2024, the new regulation under the Building Ontario Businesses Initiative Act, 2022 (BOBIA), aims to modernize procurement and leverage the province’s purchasing power to support local industries.

Details of the New Regulation

The regulation mandates that public sector entities, including hospitals, schools, colleges, and universities, give preference to Ontario-based businesses when procuring goods and services. This includes everything from school supplies to cafeteria food, ensuring that public funds circulate within the local economy.

Economic Impact and Objectives

Caroline Mulroney, President of the Treasury Board, emphasized that the move is designed to protect supply chains, create jobs, and rebuild the economy by ensuring that Ontario businesses benefit directly from government spending. Vic Fedeli, Minister of Economic Development, Job Creation and Trade, highlighted the role of local businesses in driving the province’s economic engine and attracting investment.

Compliance and Procurement Thresholds

To remain compliant with trade obligations, the new rules apply to procurements under specific thresholds: $121,200 for goods and services in the Broader Public Sector and $30,300 for goods and $121,200 for services in the Ontario Public Service. This strategic threshold setting is intended to maximize the impact of local procurement without contravening trade agreements.

Government and Economic Strategy

The government projects that these changes will direct at least $3 billion in contract awards to Ontario businesses by 2026. This initiative is part of a broader effort by the province to centralize and modernize its procurement processes through the agency Supply Ontario, which collaborates with partners to transform procurement practices.

Support for Small Businesses

Nina Tangri, Associate Minister for Small Business, stated that the regulation is a game-changer for the over 400,000 small businesses in Ontario, potentially enhancing economic prospects across the province. The policy is expected to create substantial opportunities for these businesses, contributing to a more vibrant and resilient local economy.

Ontario’s new procurement regulation represents a proactive approach to economic development, focusing on supporting local businesses and fostering a self-sustaining economic environment. By prioritizing Ontario-made products and services, the province aims to strengthen its economic foundations while ensuring public sector entities contribute directly to this growth.

 

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