by Shantel Lipp Shantel Lipp

Fighting for Industry Every Year

Shantel Lipp

The end of 2022 is within sight. I am proud of all we accomplished this year, and I am looking forward to making more progress in the upcoming year.

This year, I recognized we need to continue to help others fully understand our industry. Those we work with need to continuously hear from us to better understand our members, the contributions you make and the challenges you face. 

For example, the City of Regina put forward a motion about local procurement and economic recovery. In that motion was a fair wage policy for all construction, maintenance and service contracts. I made a submission on behalf of the Saskatchewan Heavy Construction Association explaining the implications of such a policy and I asked questions that showed the kinds of challenges such a policy would create. 

Knowing how we attract and compensate employees, the qualifications of those employed in the industry as well as how our members work with a general contractor were just some of the points I made in my submission. In the end, the motion was defeated, but I recognize it was a good opportunity to help a level of government understand what businesses like yours need to be successful working with them. 

Another example of how I worked to ensure governments and others better understand our industry to improve their relationship with members is the work I did with the Ministry of Highways to develop adjustments to the fuel escalation clause. 

Earlier this year, the Ministry of Highways presented some proposed adjustments to the fuel escalation clause. That proposal was reviewed, and several members provided additional improvements they would like to see added. I brought forward their requests and provided actual figures and examples of how our industry has been impacted by the price of diesel fuel climbing. Ultimately, after some back and forth, updates were made and included in fall tenders.  

On a broader scale, we are working with other heavy construction associations in Western Canada to draw attention to the need for Canada to invest in its trade infrastructure. We were part of the release of a report From Shovel Ready to Shovel Worthy that was produced by the Canada West Foundation. That report encourages both the federal and provincial governments to plan their investment more strategically in infrastructure that supports the movement of goods and people through and far beyond our country. 

It is important that we continue to raise the profile of our industry by explaining the work that we do, how that work gets completed and how that work contributes to improving our province and country. When we can help others recognize the significance of the work being done by our industry, we can not only benefit our members, but we can also improve what is possible in our province and country because of what members like you build. This is what makes me proud of the role I hold and the work that I do on your behalf. 

You’ve worked hard through this year and now, with the construction season done for the year and the next one still months away, I hope you have an opportunity to rest and recover – and maybe even escape the cold – to get back at it once winter fades away. I wish you all a very merry Christmas and all the best in the new year, when I look forward to getting back to work to make even more progress on your behalf. 

by Shantel Lipp Shantel Lipp

Inflation

Shantel Lipp

As 2022 continues to move ahead, one word keeps popping up again and again as businesses and households review their finances: inflation.

As costs increase, everyone must find ways to make ends meet. What that means for our industry has been calculated in an economic impact analysis done for the Saskatchewan Heavy Construction Association.

That analysis found that the industry is expected to face a further $426.7 million in new costs. The analysis looks at what that would mean for the profitability of the industry. It finds the industry profits $670 million per year on sales of $9 billion. Subtract $426.7 million in new costs and profits are squeezed to $243.4 million.

Knowing that profits are not distributed uniformly among all companies in the industry, reducing an industry’s profits by more than half would be too difficult for some companies to survive. It would also mean far fewer jobs in the industry as employment numbers could drop by more than half. 

One of those additional costs that our members face is an increase in the price of diesel. That increase in fuel has been difficult for many of our members under the existing contracts they have with the Ministry of Highways. 

You might recall that in July, I said in my President’s Message in The Interchange that we were discussing this situation with the Ministry of Highways. Seeing that the increase in fuel was estimated by the ministry to be around 69 per cent, it was important that we find a way to resolve the issue. 

Earlier this year, the Ministry of Highways presented our association with some proposed adjustments to the fuel escalation clause. 

The ministry had proposed expanding the scope to include additional types of work. It is also looking at the consumption rate and applying the existing consumption rates more broadly in some areas of work. It is looking at better options to address fuel consumption for haul. Then, there is payment. The ministry is using a monthly adjustment to apply interim adjustments in advance of a final calculation.

Our industry has reviewed the proposal and a number of SHCA members provided additional improvements they would like to see beyond what the ministry has proposed.  

All of this should help contractors with their cash flow.

We provided actual figures and examples of how the industry has been impacted by the price of diesel fuel escalating. We asked for compensation for our members that currently provide asphalt concrete products that go into making the binder materials for crushing, micro-
surfacing, paving and more. Then, there are the various types of work that also consume diesel fuel that the ministry didn’t include in its presentation, such as rock excavation and hauling used for dirt excavation. 

We have been working with the ministry on revising the industry consumption rates to reflect more realistic figures. It should be reasonable and fair to both industry and government. 

The result of all that work is that there have been updates that will be included in fall tenders. Look for updates to the specifications for bid requirements and conditions, measurement and payment (which includes details on payment for extra work, partial payments, final payments, and diesel fuel adjustments) and site occupancy, which will be incorporated into all contracts with a tender close date of Sept. 19 or later.

Also, a dating error has been corrected in the Weekly Diesel Fuel Prices document and the payment schedule has been changed to monthly instead of at the completion of each phase of the project. All of this should help contractors with their cash flow. 

Having this situation addressed by the provincial government was important and I am pleased we have been able to make this progress. 

I must say that I have enjoyed getting to know the new Minister of Highways, Jeremy Cockrill, who moved into the role in May. I appreciate the interest he has in getting to know the industry, its pressures and successes as well as its people. 

I appreciate all of you who contributed input so that we could provide the government accurate and meaningful information so your need could be addressed. 

Shantel Lipp
by Shantel Lipp Shantel Lipp

President’s Message

Shantel Lipp

Now that we are in November, the end of 2022 is within sight. The end of a year is a good time to reflect on what has happened and what to expect in the future. 

What I am watching now are two developments that I expect will be more fully explained in the coming year. The first is project carryovers. I’ll be watching to see what impact they will have on the upcoming 2023–24 budget. You will recall that the current budget did not include money for new projects. The province said it was dedicating $453 million in that budget to capital projects, but virtually all the work available from the ministry had already been tendered before the spring tender was out.

Numerous projects were completed for the Ministry of Highways this year, including paving work on Highway 1 west of Moose, Highway 6 south of Naicam and Highway 37 in the Shaunavon and Gull Lake area. Passing lane projects on Highways 7, 12 and part of 16 have wrapped up. There have been numerous resurfacing projects, including ones near North Battleford on Highway 4 and west of Humboldt on Highway 5 as well as south of Kindersley on Highway 21. The fall tender was slightly smaller than is typical, but we understand the ministry will be releasing schedules throughout the winter – projects such as small span bridges, crushing and hauling and trapline jobs in preparation for spring.

Meanwhile, there are highway construction projects continuing at this point. Through the winter, some work can be done, including hauling heavy materials in preparation for next season. As that work moves ahead, I’ll be maintaining my relationship with Highways Minister Jeremy Cockrill, making the case that Saskatchewan must continue to spend on its infrastructure to continue its economic momentum and encourage investment in this province. I’ll be looking to gain information from the ministry that I can share with members. 

I’m also monitoring what the provincial government is calling “historic legislation.” The Saskatchewan First Act was introduced earlier this month to assert the province’s legislative jurisdiction over exploration for non-renewable natural resources as well as developing, conserving and managing non-renewable natural and forestry resources and operating sites and facilities for generating and producing electricity. 

This legislation would create an Economic Impact Assessment Tribunal. Its purpose would be for “conducting economic impact assessments in relation to federal initiatives.” The members of the tribunal would be appointed by the Lieutenant Governor, who could refer to the tribunal any federal initiative that could cause economic harm to Saskatchewan. 

The tribunal would complete an assessment and report its findings and recommendations to the minister. Those recommendations could be about the nature of the economic impact on projects, operations, activities, industries, businesses and residents in the province. It could include steps to be taken to minimize the impact as well as unintended consequences. 

While there has been plenty of discussion about friction in the relationship between the provincial and federal governments around policies such as the carbon tax, The Saskatchewan First Act is still new and many are in the process of reviewing it, including me.

You may recall a white paper, Drawing the Line: Defending Saskatchewan’s Economic Autonomy, released in October that provided some insight into the government’s introduction of this legislation. In that paper, it is stated the Government of Saskatchewan is exploring all its options and has an objective to protect this province’s economic future so that natural resources can continue to be extracted and developed responsibly, trade corridors can be expanded to provide the world what it needs and the residents and businesses are protected from “harmful” federal policies. 

SHCA has an interest in this province’s trade corridors and continues to discuss this matter with the provincial government, so I will be interested to know how this legislation and these objectives could impact our members. I’d also be interested to know what you think of this white paper and the legislation that has been introduced. 

Shantel Lipp - SHCA President
by Shantel Lipp Shantel Lipp

Diesel Fuel Adjustments

The construction season is underway, and work is in full swing. While that work moves ahead, the realities of inflation have been unavoidable.

Since the start of the year, the price of diesel has climbed substantially. Continuing to pay that much more for fuel has been difficult for many of our members under the existing contracts they have with the Ministry of Highways, which has estimated the increase to be around 69 per cent.

Shantel Lipp

Now, there is a conversation happening about what to do about this situation. Recently, the Ministry of Highways presented our association with some proposed adjustments to the fuel escalation clause. Since the start of the year, the ministry has been reviewing prices and policy and exploring potential options for updating the policy and the budget impacts of those possible updates. Then, in late March, there was a standard practice bulletin posted that directed that interim diesel fuel adjustments be calculated and applied monthly to improve contractors’ cash flow. But, at that time, no formal changes were applied to the policy. 

Then, in June, the ministry began a process to review options – with industry – for updating and expanding the diesel fuel adjustment. The risk associated with the cost of diesel is shared by the ministry and contractors, but not all types of work or components of work are eligible for the adjustment. Not all diesel consumed on a project is included. 

This shared risk will continue, but the ministry is open to taking on a greater share of the risk. The ministry has proposed expanding the scope of work to include additional types of work. It is also looking at the consumption rate and applying the existing consumption rates more broadly in some areas of work. It is also looking at better options to address fuel consumption for haul. Then, there is payment. The ministry is using a monthly adjustment to apply interim adjustments in advance of a final calculation.

While the ministry has some ideas, it had asked for industry to provide input on a few questions:

  • Are the work types eligible for the diesel fuel adjustment appropriate?
  • Are the proposed and existing consumption rates relevant? Do they adequately reflect the nature of the work being performed?
  • Is the method of calculating and applying the diesel fuel adjustment sufficient “as is”?

Our industry has reviewed the proposal and a number of SHCA members provided additional improvements they would like to see beyond what the ministry has proposed.  

We provided actual figures and examples of how the industry has been impacted by the escalation in diesel fuel. We’ve also asked for compensation for our members that currently provide asphalt concrete products that go into making the binder materials for crushing, micro-surfacing, paving and more. Then, there are the various types of work that also consume diesel fuel that the ministry didn’t include in its presentation, such as rock excavation and hauling used for dirt excavation. Finally, we will be working with the ministry on revising the industry consumption rates to reflect more realistic figures. It should be reasonable and fair to both industry and government. The deadline for comments was July 8.

The ministry is aiming to complete any updates to the diesel fuel adjustment by Aug. 15 this year in order to include them in all fall tenders. Changes through the supplemental agreement will be applied retroactively to the active contracts back to Jan. 1.

I know the current situation is not sustainable for our industry and this is a crucial conversation for many of our members whose future depends on this situation being addressed by government. We appreciate all of you who have contributed your input so that we can provide government accurate and meaningful information to ensure changes address your real need. 

by Shantel Lipp Shantel Lipp

Champions of Infrastructure

Shantel Lipp

Infrastructure needs its champions, and the Saskatchewan Heavy Construction Association is proud to be one of them. Recently, our chair and some of our board members had the opportunity to attend a dinner meeting in Saskatoon sponsored, in part, by the SHCA.

The Canada West Foundation, which released the Shovel Ready to Shovel Worthy report last month, was in Saskatchewan for its board meeting, bringing together those who understand what Western Canada offers the world. Trade infrastructure is how we make sure that what provinces like Saskatchewan produce can be transported from here to everywhere that buys what we sell. The SHCA champions for long-term investment into trade infrastructure through its relationships with the Western Canadian Roadbuilders as well as the Civil Infrastructure Council among others, such as the Canada West Foundation.

These relationships are how reports such as the Shovel Ready to Shovel Worthy report are produced and promoted. A report like that creates the narrative for industries like ours to have the conversation with elected officials, and industry leaders at all levels about working together to capitalize investment into trade corridors.

A report like Shovel Ready to Shovel Worthy is where compelling data is pulled together and presented to prove our case. A report with such data is at the core of our collaboration on coordinated campaigns that target the federal government to carve out explicit funds for trade-related infrastructure. The contents of the report will be discussed at meetings with Saskatchewan’s new Minister of Highways, Jeremy Cockrill, as well as the new chief of staff, Brayden Fox, who I am excited to work with going forward.

It is the focus of messages our industry and association send out to the public through radio, social media and publications to get people thinking about the value Saskatchewan’s trade infrastructure brings to our economy and the people of this province.

It is what we bring forward to conversations with groups such as the City of Regina, the City of Saskatoon, SUMA, SARM, the Saskatchewan Trucking Association and chambers of commerce. We encourage municipally elected officials, business owners and administration to recognize how trade benefits from this infrastructure and to echo our message about investment in it.

If you can’t move it, you can’t sell it. That’s a message that resonates with everyone. Between opportunity and crisis, Saskatchewan and Canada face a choice. We have opportunity but we need a plan to capitalize on it over the long term to rebuild this country’s trading reputation. Helping those who make decisions about funding trade infrastructure to recognize that opportunity and choose to support strategic investment that betters this country is why SHCA works with other champions.

by Shantel Lipp Shantel Lipp

Construction Safety Associations: Critical to Industry Safety

Safe and healthy workplaces matter to industry.

Industry is most qualified to identify current hazards in their workplaces that could lead to injuries and to determine best practice to prevent injuries. Industries at higher risk of injuries, such as heavy construction, demonstrate safety is a priority by maintaining safety associations to support workplaces. 

Practical and relevant safety training as well as advice and support is developed and delivered by these safety associations. These services are based on direct knowledge that industry provides these associations. Saskatchewan is fortunate to have seven safety associations, including the Heavy Construction Safety Association of Saskatchewan.

As a Saskatchewan Heavy Construction Association member, you should know about recent changes by Saskatchewan’s Workers’ Compensation Board (WCB). These changes undermine the work and credibility of the province’s industry safety associations. 

Agreements about the delivery and accountability of funding as well as WCB’s requirements of these associations are being reinterpreted and revised. This has the potential to radically change the nature and purpose of safety associations in Saskatchewan as well as the role of the WCB.

I am working closely with these safety associations so that we can preserve them as well as industry’s role in developing relevant and effective safety training. Through our research, we have mapped out the moves being made by WCB that undermine the safety associations. These moves are primarily around funding, but also include presenting safety data and injury numbers without including necessary context. (That context would reveal WCB’s indirect knowledge of industry. Its decisions and actions based on indirect industry knowledge impact safety outcomes.)

As safety leaders, our group’s advocacy efforts with government are not just defending the safety associations. We are on the offense, proposing our own vision for the organization and administration of safety in Saskatchewan, including enforcement.

Industry organized, sponsors and funds these safety associations so the resources that workplaces need to maintain and improve safety on worksites exists. These safety associations provide valued guidance and support to workplaces, and I ask you to keep this issue in mind as you prepare for 2022’s work season.

by Shantel Lipp Shantel Lipp

President’s Message

Together, we are better. Now that we can host and attend events, we have a few coming up that offer our members a great opportunity to move forward their interests. Mark your calendars with these events in November. 

The first is the MLA reception that the Saskatchewan Heavy Construction Association is hosting on Nov. 1 from 5 to 7 p.m. This event is your opportunity to meet with provincial MLAs from both sides of the legislature to talk to them, face to face, about your business as well as the industry.

Whatever insights, issues or topics you think these MLAs need to recognize is up for discussion when we get together in Room 218 at the Legislative Building in Regina. Encourage other members to attend to speak to amplify the message you feel needs to get across. 

We ask that everyone planning to attend pre-register as the SHCA needs to provide the legislative staff with the list of names of those attending. To pre-register, please contact traceyk@saskheavy.ca or slipp@saskheavy.ca. The earlier you register, the better!

The second event is the SHCA Fall Convention, which is scheduled Nov. 25–26 in Saskatoon. For two days, we will gather at the Delta Bessborough Hotel and Convention Center to listen to speakers and participate in conversations about our industry. 

On Friday evening (Nov. 26) is the Chairman’s Banquet. New this year is that the capacity for this event is set at a maximum of 300 delegates. That makes registering and booking your room early extra important! 

Registration links are now open and available for the SHCA Room Block. More details about the convention will be coming out as we move towards November. 

Events such as these are important to our members because they help develop and strengthen the voice of the association. Gathering to share about our experiences, ideas and suggestions helps our members recognize and realize improvements and opportunities. It is how our members can find and form the connections that make their businesses and this industry even better. 

I look forward to seeing each and every one of you who takes part in these events and learning more about your current interests and ideas so I can best represent you and our industry. 

by Shantel Lipp Shantel Lipp

Martin Charlton Communications Leads Government Relations Session for SHCA Board

Government is a critical stakeholder in heavy construction.

When those in politics have a solid understanding of our industry, the decisions that get made are more likely to take into account the value we offer the province and its economy as well as the issues and concerns of those who make up the industry.

As you know, the Saskatchewan Heavy Construction Association is a member-driven association relied on to advocate for your interests. It is important to maintain a quality relationship with those who are elected to make decisions that impact our industry. 

SHCA has partnered with Martin Charlton Communications to ensure the most effective approach is used to represent our industry to elected officials and bureaucrats. Martin Charlton Communications has worked with local, regional, national and international organizations for the past two decades to help them connect with government by telling their story.

The right people need to be told that story and it needs to be told in the right way, which is what Martin Charlton Communications – and in particular, Kelly Gallagher – works with clients to develop. The strategies he creates help organizations promote their contributions, anticipate and avoid complications and guide them through the maze of government. Gallagher spent six years in professional political service on both the federal and provincial level – including serving as chief of staff for four provincial cabinet ministers, becoming one of the most well-known and respected figures in the Saskatchewan government relations industry. 

During the third week of August, Gallagher will meet with the SHCA board to discuss the six key factors to keep in mind when conducting a persuasive government relations campaign. This is an opportunity for the board to consider how these factors – patience, simple messaging, integrity, the influence of bureaucrats on politicians, alliances and maintaining contact – can be applied to our industry’s interests. 

The work required to maintain a mutually beneficial connection with government is never-ending and requires consistent attention and decisive action. The individuals elected to represent the citizens of Saskatchewan have so many perspectives and interests to consider. 

Taking the time to reflect on what it takes to effectively c0nsort with elected representatives, so that our industry and its interests receive the appropriate attention and consideration, is time well spent because of the benefits it will deliver to our membership. Infrastructure funding and fair bidding on projects, the regulation of our industry and safety matters are areas to focus on with government and this session with Gallagher should sharpen our focus and strengthen our tactics. 

The story we have to tell about our industry is one I take pride in telling during my interactions with those in government. Thank you for the opportunity to celebrate and advocate on your behalf.

Shantel Lipp
by Shantel Lipp Shantel Lipp

Inaugural Meeting of the Women in Construction TEC Group

Meeting with a group that is open to advice and generous with their insights is an empowering experience that helps to develop one another.

A group like that came together recently to create that experience for women in construction. We met as the Women in Construction – TEC Group for its inaugural meeting. This introductory meeting was held to gauge the interest in this type of a group holding ongoing meetings to support those involved.

Women from various sectors of construction who are living and working in many different communities in the province met on May 20 to learn about TEC and gain peer support and offer advice. Some of the women had been working in their field for decades while others were new to theirs. Their roles covered a wide array of functions, from ownership to human resources to fleet management.

It was an important opportunity to draw out the perspective of women discussing the challenges, issues and successes in the construction industry. The group discussed navigating work relationships, giving one another suggestions on how to ensure those in the relationship recognize it is strictly professional. Others were looking for input on human resources challenges, including onboarding new employees who primarily speak a language other than English. Through the discussions, we generated great ideas to help find solutions to common concerns.

It was an important opportunity to draw out the perspective of women discussing the challenges, issues and successes in the construction industry.

Coming together to discuss challenges and opportunities related to business and career development is important for anyone building their career. Sitting down on a scheduled basis to have these discussions with people who have similar life experience can be reassuring.

There is interest in another meeting being scheduled to allow for the conversation to continue and to welcome additional women interested in an opportunity like this. Given the busy season that is summer, the plan is to schedule the next meeting sometime in late August.

If you would like to participate, please send me an email to get more information, including the date once one is set. You can email me at slipp@saskheavy.ca