Vendor Performance Corrective Measure Policy (VPCMP)

The Vendor Performance Corrective Measure Policy (VPCMP) is a Public Services and Procurement Canada (PSPC) policy. Its stated purpose is to help the PSPC procurement community mitigate procurement risk in future contracts and improve client service. It has been in effect since November 4, 2010. The full policy is published on CanadaBuys.

Under the policy, PSPC can impose a vendor performance corrective measure (VPCM). A VPCM is a condition or limitation on a supplier's future contracting opportunities. It is used when evidence indicates that continuing to contract with the supplier poses an unacceptable risk to Canada. The policy is administered by PSPC's Acquisitions Program, acting as a common service provider for transactions under its contracting authority.

What triggers a VPCM assessment

A corrective measure follows a documented performance failure. According to the VPCMP process page, an assessment can be triggered in two ways:

• A major instance of poor performance that results in a termination for default or a conditional amendment.
• A cumulative record of terminations for default or conditional amendments.

PSPC supply arrangement clauses build this link into the contract terms. In the task-based services supply arrangement, a full or partial termination for default triggers a mandatory assessment under the VPCM Policy. The same approach appears in the professional audit support services supply arrangement and the solution-based supply arrangement.

What a corrective measure can do to your offers

Where the corrective measure is relevant to the procurement, PSPC's policy sets out specific consequences:

• Offers from a supplier subject to a VPCM may be rejected in competitive procurements for goods or services.
• Offers for standing offers for goods or services may be rejected.
• Offers for supply arrangements, and bids for contracts under supply arrangements where PSPC's Acquisitions Program is the contracting authority, may be rejected.
• For a sole-source contract, negotiations must not be initiated and an offer must not be accepted when the supplier is subject to a relevant VPCM.

A VPCM does not affect existing contracts. It does, however, generally prevent PSPC from extending a contract term through an amendment or exercising an option. The exceptions are cases where there is insufficient time to re-compete or where other exceptional circumstances exist.

How the VPCMP differs from related policies

The VPCMP addresses performance risk under PSPC contracts. It is separate from the federal Ineligibility and Suspension Policy, which addresses government-wide supplier-integrity risks. PSPC describes that integrity regime on its addressing misconduct and wrongdoing page.

The VPCMP is also separate from Vendor Performance Management (VPM). VPM evaluates supplier performance against contractual obligations. A termination for default is the point where the two connect, because it can trigger a mandatory VPCM assessment.

What the VPCMP means for suppliers bidding on Canadian public contracts

The policy applies to PSPC's Acquisitions Program, so suppliers who bid on PSPC competitive solicitations, standing offers and supply arrangements are the ones affected. A termination for default on a PSPC contract carries consequences beyond that contract, because it can lead to restrictions on future bids.

• Treat delivery obligations and any conditional amendment as matters that can affect your future eligibility.
• Read the performance and default clauses in supply arrangements before you accept them.
• Note that a measure is relevant only where it applies to the procurement in question, and that existing contracts continue.
• Review the CanadaBuys policies and directives page for the current policy text.