Project approvals

A project approval is an authorization to proceed with a project within an approved scope, cost, schedule and risk profile. The term is used in Treasury Board project governance and in Canadian defence procurement, where it marks the point at which a department is cleared to move a project forward.

Project approval is one of three distinct permissions. It is separate from expenditure authority, which authorizes spending, and from contracting approval, which authorizes the procurement or contract action. Treasury Board guidance links project activities to project approval, expenditure authority and amendments under the Directive on the Management of Projects and Programmes, including its project-approval limits and authorities. The guidance is published on canada.ca.

Project approval, expenditure authority and contracting approval

Each approval answers a different question. Project approval confirms that the project can proceed within its approved baseline. Expenditure authority permits the department to spend the funds. Contracting approval permits the contract action itself.

These approvals can sit with different bodies. For major defence projects, the Department of National Defence (DND) seeks Treasury Board Project Approval Authority and Expenditure Authority where a project exceeds its delegated authorities. Public Services and Procurement Canada (PSPC) separately seeks Treasury Board contracting approval before contract award when a contract's value or risk exceeds PSPC's delegated limits. The Office of the Procurement Ombudsman describes this division on its Treasury Board contracting approval page.

How DND uses project approvals

DND uses project approvals throughout the acquisition life cycle, from concept through close-out. For a major project outside its delegated authority, Treasury Board approval is required.

The approval establishes the project baseline, which covers scope, cost and schedule. It also permits DND to proceed with implementation and to spend funds on the specified defence-project requirements. The PSPC publication on defence procurement and the Procurement Ombudsman page both describe this role.

DND's procurement workflow on CanadaBuys lists approval activities that sit alongside the project approval. They include obtaining SRB and SPAC approval and preparing project submissions for approval by designated project and expenditure authorities, including the Project Management Board. See the CanadaBuys page on agreements with the Department of National Defence.

Approval levels and dollar thresholds

Approval levels vary with the value and type of the project. DND's Project Approval Directive governs minor projects at the discretion of the responsible Level One organization. A DND review states that projects over $1 million require approval from the Assistant Deputy Minister (Materiel) or the Deputy Minister, while delegated authorities approve lower-value projects within the stated thresholds. The review is published as a DND report on canada.ca.

Government acquisition-service records list a wider set of possible approvers. They include Supply Officers, Supply Specialists, management, Treasury Board, the Procurement Review Committee and the Senior Project Advisory Committee. The same records identify Procurement Review Committee approval for projects over $2 million, and SPAC review for procurements over $100,000 that are not managed through the applicable mandatory contracting process. Both thresholds appear in the acquisition services valuation tool.

What project approvals mean for a supplier

Project approval is a buyer-side authorization. It is not a supplier application, form or certification. Its effect on suppliers is timing and certainty: a department may not be authorized to proceed to solicitation, implementation, contract award or additional expenditure until the required internal or Treasury Board approvals are in place.

A supplier bidding on a Canadian public contract should comply with the solicitation and contract conditions in force. When tracking a major defence project, it helps to know which approval is outstanding, whether project approval, expenditure authority or contracting approval, because each one gates a different step before award.