Leonard Preyra - MLA for Halifax Citadel – Sable Island

PUBLIC ACCOUNTS COMMITTEE

Ms. Diana Whalen (Chairman)

Mr. Leonard Preyra (Vice-Chairman)

Mr. Clarrie MacKinnon

Ms. Becky Kent

Mr. Mat Whynott

Ms. Lenore Zann

Hon. Keith Colwell

Hon. Cecil Clarke

Mr. Chuck Porter

WITNESSES

Office of the Auditor General of Nova Scotia

Mr. Jacques Lapointe, Auditor General

Mr. Alan Horgan, Deputy Auditor General

Mr. Terry Spicer, Assistant Auditor General

Ms. Evangeline Colman-Sadd, Assistant Auditor General

Ms. Ann McDonald, Assistant Auditor General

In Attendance:

Mrs. Darlene Henry

Legislative Committee Clerk

Ms. Kim Leadley

Legislative Committees Office

HALIFAX, WEDNESDAY, FEBRUARY 3, 2010

STANDING COMMITTEE ON PUBLIC ACCOUNTS

10:00 A.M.

CHAIRMAN

Ms. Diana Whalen

VICE-CHAIRMAN

Mr. Leonard Preyra

MADAM CHAIRMAN: Good morning, everyone. I’d like to call the meeting to order for the Public Accounts Committee. As you know, this is our opportunity today to hear from the Auditor General who is presenting a report to us, which he does twice a year. I would like to begin the meeting by having the members of the committee introduce themselves and, as well, we’ll have our guests introduce themselves for the record.

[The committee members and witnesses introduced themselves.]

MADAM CHAIRMAN: Thank you very much. As is usual with our committee, we’d like to begin with a short presentation by our guests, so I will ask Mr. Lapointe if he could give us a summary of the chapters. We, of course, as members of the committee have just had a more fulsome explanation and meeting prior to this, so if we could just have the summary, thank you.

MR. JACQUES LAPOINTE: Thank you, Madam Chairman. As you know, this morning my February 2010 report was tabled with the House of Assembly and I am pleased to have this opportunity to discuss it with you today. I know we introduced ourselves but you should know that I have members of my senior management team with me today. They were instrumental in producing this report. They include Deputy Auditor General Alan Horgan, and Assistant Auditors General Evangeline Colman-Sadd, Ann McDonald and Terry Spicer.

1My report covers work completed during the summer and Fall of 2009. It includes three chapters on performance audits of government programs: the electronic health records at the Department of Health; contract management of the public-private partnership, P3 schools; constituency and other expenses of Members of the Legislative Assembly; and it includes three chapters on our work with respect to the province’s financial reporting.

As an independent and non-partisan officer of the House of Assembly, I assist the House to hold the government accountable for its management of public funds and I have a responsibility to contribute to improving the performance of the public sector by recommending solutions to weaknesses or deficiencies in government programs. My report makes 59 recommendations to improve the operations of government in each of the areas that we audited.

Madam Chairman, I and my staff will be pleased to answer your questions.

MADAM CHAIRMAN: Thank you very much. We’ll proceed as we do normally with this committee, with 20 minutes for each of the three caucuses in our first round of questioning. I will turn the floor over to Mr. Colwell for the Liberal caucus.

HON. KEITH COLWELL: Thank you, Madam Chairman. First of all I’d like to ask a few questions on the audit you did on members’ expenses, if that’s all right. Are you comfortable that you were able to perform a thorough examination of a member’s constituency and other expenses?

MR. LAPOINTE: Yes, I can say that we were able to get access to all the information we needed to thoroughly audit what we needed to look at.

MR. COLWELL: Thank you. Now to present your report, have you concluded your examination?

MR. LAPOINTE: Yes, we have concluded and this is our final report.

MR. COLWELL: Were all expenses of all members examined?

MR. LAPOINTE: We looked at all the expense claims for all the members who were sitting for the period that we examined, which was up to last June.

MR. COLWELL: My final question – well, not actually my final, my second-last one – how long has it been since the last audit of members’ expenses?

MR. LAPOINTE: The last review of any kind on this area was approximately 15 years ago.

MR. COLWELL: Is that something you intend to change over time, or be more frequent?

MR. LAPOINTE: Yes, I think we need to be looking at this kind of thing on a more regular basis. I can’t commit to the future but I think this area will be looked at sooner than 15 years, I’m certain.

MR. COLWELL: Did the examination differ in any way from those that you would perform for any other agencies or departments?

MR. LAPOINTE: We have standard procedures for looking at expense claims and our audit procedures are the same regardless of where we look. We followed pretty standard auditing procedures in this area as well.

MR. COLWELL: Okay, thank you. My next questions are going to be on the financial report. Could you please clarify why the RDAs were excluded from the present audit – the RDAs, the regional development agencies?

MR. LAPOINTE: Well, these agencies are not actually within our jurisdiction. They are not part of the government reporting entity so they are actually outside our mandate.

MR. COLWELL: Even though the province puts in approximately one-third of the total funding in every RDA?

MR. LAPOINTE: No, this is true. We did at one point examine that situation to determine whether they were within our mandate or not and decided they were not. There are quite a number of organizations that receive government funding one way or another. It’s like the municipalities. But they are not part of the provincial organization so they’re not part of what we look at.

MR. COLWELL: Don’t the RDAs fall under the responsibility of the Minister of Economic and Rural Development?

MR. LAPOINTE: I understand that while, in fact, there are different types of organizations but they don’t actually come under, I guess you’d call it, the responsibility of the department, they are independent organizations so are therefore, in effect, an outside agency receiving government money.

MR. COLWELL: Who is responsible for auditing the RDAs if your department isn’t? Is there someone out there responsible for doing this, to make sure that we’re getting value for our money, or do they just work out there and hope that the federal or municipal governments hold them accountable?

MR. LAPOINTE: I’m not sure I have an answer for that because I know that when we determined that they were not within our mandate – it’s hard for me to say then where that responsibility falls. All I can say is it is not ours.

MR. COLWELL: So it’s one of those things that sort of slipped through the cracks someplace and something that should probably be looked at some time?

MR. LAPOINTE: They are in many ways a partnership organization, they involve the province, they involve usually several municipalities. What public organization would have jurisdiction over audit or a review of these organizations, I can’t really say.

MR. COLWELL: Would it be possible for your office and someone from the municipalities – whatever area an RDA is in – and someone from the federal audit department to look at these? It’s a substantial amount of money that is being expended and I don’t know if we’re getting value for the money in some cases, perhaps some cases we may be. I really don’t know.

MR. LAPOINTE: I don’t know how much I can say about that. It’s not something we examined in this report and I’m not sure, since we haven’t really gone into detail on that, whether it’s possible for the province to have authority to audit those right now or not.

MR. COLWELL: Just on another topic. You also stated that it’s presently a clear challenge in the budget process for government to accurately present a budget. What did you indicate by that? What did you mean by that? I understand it’s very difficult, very complex and so many different departments and everything that have to go there. What would you suggest so the government could more accurately present a budget?

MR. LAPOINTE: I’m not sure if I totally understand what part of the comments you’re talking about.

MR. COLWELL: Maybe my question leads to the briefing we had earlier and it’s in the report that, for instance, I believe a year or two years ago when the budget came in there was a forecast of a $20 million surplus and indeed when the whole process went through, that surplus really wasn’t there. That’s the sort of thing I’m talking about.

MR. LAPOINTE: If you’re talking in terms of the budgeting, the only part of it that we examine is the revenue. We don’t comment on the budgeting process per se or the expenditures part of it. We simply examine the revenues to determine whether they are, in fact reasonable, according to certain criteria and based on valid assumptions and then we pass our opinion on that. We do not comment on the budget, as a whole.

MR. COLWELL: Also you mentioned too and it was clearly stated in your report that, ” . . . the Department of Finance has been given the responsibility to prepare the annual

estimates without being provided the authority to compel departments to provide all necessary information.” Really the question is, how can the Minister of Finance and the department really prepare an estimate if that isn’t there? There seems to be a loophole in that area. Is that a correct interpretation I have with that?

MR. LAPOINTE: I’ll ask Ann McDonald to speak to that question.

MADAM CHAIRMAN: Ms. McDonald.

MS. ANN MCDONALD: The Provincial Finance Act gives the authority, I guess, or the requirement for the Minister of Finance, and through his staff, the deputy and the remainder of the staff at the Department of Finance to prepare the budget. I guess what we note as we go through the revenue estimates process is that, for example, I mentioned the revenue for the school boards and the district health authorities are neither estimated nor included in the revenue estimates. We’ve noted in our recommendation that the Provincial Finance Act should be amended or this issue should be resolved so that in the preparation of the revenue estimates, there is authority for these revenues to be estimated in the various departments where they currently are not being estimated.

MR. COLWELL: That’s quite a loophole because the Departments of Education and Health are two of the biggest expenditures in the whole province. So it would take an amendment to the Provincial Finance Act to do that, is that correct?

MS. ANN MCDONALD: I’m sorry, I don’t know whether that would be the appropriate vehicle, but I believe our recommendation is that there needs to be some authority for the minister to compel these estimates to be made.

MR. COLWELL: Also, one other thing, you’ve expressed concerns about advance payments and funding obligations being made to university-assisted funding. Could you elaborate on that a little bit?

MR. LAPOINTE: I can say that the concern here is a financial management issue that has come up before. The payment for an ongoing expenditure, an annual kind of payment of claims or agreement can be pulled forward and paid ahead – that causes problems further down the road. The government is entitled to do that and record the payments in the year in which it is made. We feel that’s a poor practice because that’s not necessary and because it leads to future issues in the financial statements and the budgets in which either payments will then be lower than normal and then resume again in future years, so it leaves some financial management difficulties. We feel that it is best avoided.

[10:15 a.m.]

MR. COLWELL: You indicate that it wasn’t a good practice in 2008-09. Do you think it was acceptable in 2009-10, the same sort of thing or is that something that government should probably practice on an ongoing basis?

MR. LAPOINTE: Are you referring to the same advanced funding issue?

MR. COLWELL: Yes.

MR. LAPOINTE: It’s one of these things that once you begin it, it’s kind of hard to stop because when you get back on track you now have to have some distortions to get back on paying in the year in which you should. We feel that at some point government should get back to funding regular payments in the year in which they’re required and get back to the normal stream.

MR. COLWELL: So you feel sort of the lump sum, up-front payments to universities – I’m not asking about the payments themselves, but the process of doing that – will cause trouble too for the universities because they’re going to get some funds here and then down the road they’re going to be faced with wondering whether they’re going to get more funding? I don’t know if that’s an appropriate question to ask you or not but it’s just the whole process of this, it just seems to cause difficulties, probably for the accounting and the universities themselves, even though they need the funding.

MR. LAPOINTE: I don’t think I can comment on it from the university side and we really didn’t see the difficulty as emanating from there, but from the point of view of accounting at the provincial level and simply the accounting and financial management and cash flows on the government side.

MR. COLWELL: How much time do I have left, Madam Chairman?

MADAM CHAIRMAN: Eight minutes, I think.

MR. COLWELL: I want to talk a little bit about the electronic health records. You made some recommendations and we’ve had the Department of Health in here before and talked about the health records, where one system couldn’t work with another system. You’ve made some pretty interesting suggestions in your audit and recommendations in your audit in that regard.

When you looked at it, when you’re sharing information – when you looked at that audit, how far apart was the actual communication between the different systems they have now to actually give proper information on a patient that may be in one part of the province

and have to come to another part of the province and that information is important to that facility that they’re going to be at?

MR. LAPOINTE: I’ll ask Ms. Colman-Sadd to speak to that issue.

MADAM CHAIRMAN: Ms. Colman-Sadd.

MS. EVANGELINE COLMAN-SADD: Thank you. Our audit didn’t specifically look at the different systems and how they communicate with one another. That was not one of the objectives, but I may be able to give you a little bit of information on it that we gleaned as sort of part of the background to our audit. Some of the systems exist in all of the different district health authorities, for example, a PACS system, which is diagnostic imaging that allows X-rays and other diagnostic images to be stored and transferred between the different authorities so you could live in one part of the province and have a diagnostic image and it would be able to be seen, say, by a specialist in Halifax if you came here to see a specialist. So there is some of that ability.

Our concern, if you look on Page 16 of the report, there is actually a chart that shows which systems currently communicate into the SHARE system, the ultimate electronic health record, and which ones are planned to be communicating in the future. You’ll see that a lot of the lines are broken, which indicates future communication is planned, so some of those outside systems in that diagram exist already and simply don’t communicate with SHARE. Some of them don’t exist yet and need to be implemented. As time goes on and as systems are upgraded, it will be important for the department to make sure that all of the systems, as they are created or are upgraded, will be able to talk to that SHARE system at the end of the day or communicate with it.

MR. COLWELL: When you talk about the SHARE system, from an audit standpoint and I only ask from an audit standpoint, how important is this system to the overall operation of the health care system? I know that’s difficult to answer but we’re faced with a huge increase in health care all the time and it’s just a matter of our demographics, our population and other factors that really nobody can control. How important is a system like that as you go through the process?

MS. COLMAN-SADD: How important an electronic health record system is – we live in an electronic age so clearly as time goes on, things are becoming more automated and records are becoming more automated. An electronic health record would provide the ability, if it were province-wide, for somebody, say, in Yarmouth or Cape Breton to come to Capital District and have their records accessible to a doctor who they might see in Capital District. Ultimately a Canada-wide system could provide that level of information if you travelled to Alberta or British Columbia and needed to go to an emergency room there.

I guess what is important is that it has been identified as a very important initiative by all of the provinces because it is being funded through Canada Health Infoway, which all of the Deputies of Health participate in. There is federal funding and it has been identified as something that is a key initiative for the health care system.

MR. COLWELL: Do you feel, in the process that has gone on so far and in your audits, do you feel that we’ve got good value for money for the electronic systems we have in the health care system that are moving in this direction so far?

MR. LAPOINTE: I think we are looking at a very specific program and development of a particular system which we felt was actually being very well developed, so when we looked at the SHARE part of the core of this electronic health record system, we found that they were planning it very well and they were implementing it very well. The project management was good, which was a good sign to us of the future development of this whole program. We made recommendations on it to improve the way they go. This is not a comment on the whole IT system dealing with medical care but just on this very focused area.

MR. COLWELL: I appreciate that. The thing is, we had the Department of Health in before and they talked about some difficulties they had in one system speaking to the other. They were well aware of that and working on that issue and it is very important that we get that resolved.

When they go through this process, did they give you any indication when they might have this complete or when they might have some of these things in place? I think that the timing on this is quite important, too, with the escalating costs we have.

MR. LAPOINTE: I’ll ask Ms. Colman-Sadd to speak to that as she has some information in that area.

MS. COLMAN-SADD: That was one of the issues that we identified in our audit. There is no strategic plan, no long-term funding plan to say when all of these various systems that are diagrammed on Page 16 will ultimately be able to feed information into that SHARE system. The department doesn’t have a long-term strategic plan for that and basically funding is on an annual basis. They would identify projects for that year that would get funded but they don’t have any sort of, say, three- to five-year funding plan that says by the end of five years this many systems will get funded. That just isn’t in place and that was one of the concerns of our audit, that ultimately if you need all of those systems to form a comprehensive electronic health record then you need a strategic plan and a funding plan that says how and when those systems will get implemented and will be able to feed information into SHARE.

MR. COLWELL: Did you get any indication from the Department of Health after you put your recommendations forward that they might put more effort in this regard or are they sort of committed to moving in this direction faster or more deliberately, I would say, for better funding for it or whatever the case may be?

MS. COLMAN-SADD: Certainly our sense from the Department of Health’s response to our recommendations and to discussions that we’ve had with them is that they’re very accepting of the recommendations and they intend to implement all of the recommendations. There is a recommendation that specifically deals with a strategic plan for the implementation of electronic health records. So I expect that as part of addressing that recommendation, the department would be looking at developing a strategic plan.

MADAM CHAIRMAN: Mr. Colwell, your time has elapsed so we will have time, I think, for perhaps another almost 20 minutes in the next round. At this time I would like to call on Mr. Porter to begin 20 minutes of questions.

MR. CHUCK PORTER: Thank you, Madam Chairman. Just a few questions, I’m going to pick up where Mr. Colwell left off, sort of, on the health stream, if I can. You do make a recommendation on Page 15, Recommendation 2.1, about the development of an IT strategic plan for these records. But in the beginning of the report, on Page 5, Paragraph 1.12, there’s a comment that says basically, “Nova Scotia is working towards the development of a provincial electronic health record (EHR) system known as SHARE. We found the SHARE project was well planned and managed. While the system is intended to be operational in March 2010 . . .” – that’s coming right up.

How can we be well planned to manage with no strategic plan? It’s kind of contradictory with your recommendation, I guess, is where I’m going with this. I know at the same time with IT, having been there years back in a career that I formerly had, it’s ever-changing. A strategic plan is a must, there’s no question about that. Again, I want to ask about this because it seems contradictory and, Mr. Lapointe, maybe you want to take that.

MR. LAPOINTE: Yes, the reference to the strategic plan is dealing with the entire – for instance, the chart that Ms. Colman-Sadd referred to, in spite of the lack of a strategic plan, I would say, they managed the SHARE project well and are bringing it in very close to on time, it’s coming on stream very soon. The only comment we could have for it was that it was well managed and they are bringing it on stream.

But we are concerned about the lack of a strategic plan to manage the whole project with all its component pieces and all the parts that need to be integrated and need to be compatible in the long term. To plan those, to prioritize them and bring them on in the right sequence, to fund them in order of priority rather than just when funds are available, this is the broader piece. Yes, it is a bit of a contradiction. That lack of planning did not, in fact, stop them from taking this one component and managing it well.

MR. PORTER: Then as part of that recommendation, Mr. Lapointe, there’s a lot of detail to a strategic plan, how many years out are we talking here? Is this never-ending? Is it a 10-year plan in your opinion, five years? How deep do your recommendations go or is this all the recommendation that there is, that you gave back to or are providing to the Department of Health, this simple comment, or are you going in in detail and saying this, this and this should perhaps be the priorities for spending in the years ahead because this doesn’t look like what the province can afford?

MR. LAPOINTE: Our recommendation is that a strategic plan be developed that includes deciding on the priority. It’s not our job to decide what priorities should be made or what should be spent in what order. The department has to make that decision and to analyze it and from that will come a timetable, presumably, with planned – if you have a planned priority thing, you have to plan your funding, as well, to make it happen. That’s what’s required. At this point we simply can’t tell when the parts would come on stream.

MR. PORTER: So looking back then, as we’ve just done by way of this audit, the Department of Health, in your opinion, as per the first comment that I read there earlier on Page 5, Paragraph 1.12, you’re comfortable where the spending has been over the last few years at least – or the last year, however far you went back in your audit – as to where and how the funding has been spent in the Department of Health? Although you’re recommending, obviously, that strategic plan, which is very important, no question, it has to be done to prioritize, I just want to be clear on what you’re saying.

MR. LAPOINTE: Our finding was that the decisions are being made on what gets developed in what order, up to date they have been ad hoc and depending on funding available and possibly some other factors, but have not been based on a strategic plan and prioritization. This is outside the core area of SHARE and if you look at all the different systems and processes, the lack of a plan has been there and it’s needed for the future as well.

MR. PORTER: Thank you for that. I’m just jumping around here a bit. I want to talk about access and who is using and things like that about your summary report here that you have. On Page 3, the second part of Electronic Health Records, there is a briefing. There are examples, “EMRs, some physicians using, won’t be part of SHARE when first operational . . . Drug information system, Helps identify possible drug interaction concerns, etc.”

Why wouldn’t everybody be coming on-line at the same time, at least the physicians? I realize, and I’m going to ask in a moment more about access, but why wouldn’t the physicians, who would seem to be probably the most important folks managing that chart and giving the orders and treating the patients, et cetera, all be coming on-line at the same time, or do you see that as maybe a lack of that strategic plan?

[10:30 a.m.]

MR. LAPOINTE: The electronic medical records, which are the patient records in the doctors’ offices, is quite a distinct system and these are all, in fact, distinct systems with different timetables, and we perceive that as part of the difficulty. If you want to have an integrated system in which all of the pieces are compatible and communicate with each other, you have to make sure that it’s going to work like that. Eventually I can see having to stagger things and have things come on-line at different times and develop at different speeds, but you have to coordinate it and have a plan and timetable for that, and right now there isn’t one.

MR. PORTER: And that is a huge undertaking in this province, as you just spoke about, the doctors having these – I know some physicians are up and running in their office, they have access to the local hospital within the Capital District. Would you see it coming on in districts, perhaps as an example, strategically being planned that Capital would come on, Western would come on, et cetera, like that, or you just really don’t know?

MR. LAPOINTE: It’s hard to say. We can’t really say how and when and on what timetable these things should occur.

MR. PORTER: The other thing about this, I know in past reports that you’ve done, at least in my time here, since 2006, there have been recommendations toward the IT side of things around access, who has access to different things. Was that part of this audit as well? Was there a detailed audit of who had access to what, especially when it came to the patients’ personal records and things?

MR. LAPOINTE: It wasn’t specifically a focus of the audit, that’s really a distinct issue and a big one as well. We were looking at more strategic issues on this one.

MR. PORTER: And we have, I think, the Department of Health coming before us soon, that will be a question maybe more detailed for them. Just lastly, before I pass it over to my colleague, overall where does Nova Scotia stand across the country? Where do we fit in amongst how we’re operating, as far as you’re concerned, within the Department of Health?

MR. LAPOINTE: You’re speaking about the electronic health records?

MR. PORTER: Yes, you say here they’re positive. What does that mean?

MR. LAPOINTE: Let me ask Ms. Colman-Sadd to speak to that one.

MADAM CHAIRMAN: Ms. Colman-Sadd.

MS. COLMAN-SADD: Thank you. The electronic health record audit was a collaborative audit, so it was looked at by six provincial Auditors General, as well as the federal Auditor General. There will be a joint summary report that summarizes the results of all jurisdictions’ audits published by the federal OAG in the Spring. Some of the provinces haven’t released their audit results yet, so it’s difficult to say where Nova Scotia ranks. I think even once those results are released, all of the provinces are in very different stages of implementation. Some provinces are implemented, some are working on it, some are partially implemented, some have these three systems implemented while another province might have four totally different systems implemented. So it’s very difficult, I think, to do any kind of a ranking and say here’s where Nova Scotia falls.

The point that we were trying to make with the positive audit results is that the SHARE project, the core electronic health record project, was very well planned and well managed and that bodes well moving forward and trying to integrate other systems if those project management practices are applied.

MR. PORTER: Thank you very much. I was going to ask about the positive side, but you explained that out and I’m just reading through there. I think that’s fine for me, Madam Chairman, I’ll hand it over to my colleague for Cape Breton North.

MADAM CHAIRMAN: Mr. Clarke.

HON. CECIL CLARKE: Thank you, Madam Chairman. What’s the time remaining right now?

MADAM CHAIRMAN: About 11 minutes.

MR. CLARKE: Okay, thank you. I’d like to go to Chapter 4, Office of the Speaker, Members’ Constituency and Other Expenses. Just again, Mr. Lapointe, the exact reviewing reporting period – there was an initial and an extended, is that correct?

MR. LAPOINTE: Yes.

MR. CLARKE: What time frame or reporting period?

MR. LAPOINTE: The detailed time frame was for the year ending in June 2009 and we went back further, strictly for constituency expenses and I guess the technology on receiptable claims back two years before that for a three-year period.

MR. CLARKE: Just with the overall findings and looking at this, during the course of your undertaking, would you have noted that any of this with your findings – and some of them you’ve noted with regard to the opinion expressed or the interpretation – that there was any criminal or fraudulent activity by members during that period?

MR. LAPOINTE: No, we had no such findings. As you know, we have referred files to authorities in the past and we had nothing like that in this case.

MR. CLARKE: If I can maybe go to the individual recommendations, it might be an easier flow of some of the discussion of the points I would see. Recommendation 4.1, with regard to comprehensive examination, I believe the Internal Economy Board has responded – and is noted in the response from the IEB or the Speaker in the report – that former member and Speaker, Art Donahoe, would be undertaking a comprehensive report and reporting back. I think part of that is reflective in the recommendation you put forward. Is that consistent with your understanding?

MR. LAPOINTE: Yes it is. We did make a recommendation that a comprehensive review be made of the entire system and policy decisions made, and that was one of the answers to it, I believe, that this person will produce a report on it in the near future.

MR. CLARKE: In Recommendation 4.2, with regard to payments to members for personal items or expenses already covered by an allowance – in going through that whole process, if you identified a questionable expense or something that you deemed did not fit within the regulations, did you specifically, in every instance of that, contact a member for the context or the rationale they may have had for any type of claim put forward?

MR. LAPOINTE: We discussed all of these findings with individuals who were involved. My hope is that people who had claims like this, we would have got around to and discussed with each one of them as a course of the audit.

MR. CLARKE: Recommendation 4.3, with regard to rules and guidance for advertising “. . . should clearly define acceptable nonpartisan practices. Partisan advertising should not be claimable . . .” I guess one of the things is that we work in a business that in individual constituencies there is always a matter of how people interpret, represent and reflect their work. Do you have specific reference or examples with regard to what partisan would be, that had been noted? Obviously, you might have undertaken that in your review.

MR. LAPOINTE: I could ask Mr. Spicer, perhaps, to give you more details on that, but we had definite . . .

MADAM CHAIRMAN: Mr. Spicer.

MR. TERRY SPICER: In Paragraph 4.34 of the report, some of the more prominent ones that we noted were prominent displays of Party logos on the advertising, use of Party colours, and references to Party initiatives.

MR. CLARKE: In looking at that, from the IEB – and I think, Madam Chairman, just for a matter of clarity for the record – the Internal Economy Board allowed for the recognition

of members, whether they were Cabinet, what their titles would be and/or any associated duties that would assign to them, just as much as a non-government member or Opposition member could refer to their critic portfolios in their advertising to identify who the public could contact, so there was that. Also, the Internal Economy Board made a provision to allow for the use of caucus logos versus Party logos, which are different and can be perceived. In my case, the PC caucus logo is very clear, it would look partisan, but it is not the Party logo that we would use for partisan advertising and the like. Is that part of your review? Did you look at that aspect?

MR. SPICER: We would have and you’re right, the IEB has provided some guidance on that. Our view of it is, those things all clearly indicate which Party you’re a member of and it’s our view, as the report indicates, that the risk is that there may be barriers put up for some constituents because of their Party affiliation, that they might not feel comfortable approaching their representative because of that.

We’ve also looked at other provinces and what other provinces do with respect to advertising, and most have no Party affiliation at all in their advertising.

MR. CLARKE: I guess one of the things, just with that – and I would just note again for the record – I do believe it was on the basis of all-Party consent to that, so there was nothing, for instance, from one political Party to another that might be nefarious or it was understood that that’s part of it. At the end of the day everyone knows I’m a Tory, so that’s just one of those aspects, I think, that from the public looking at it, they may not look at the fact that there was all-Party consensus on some of these provisions with regard to how people advertise or promote. One of them was your affiliation in that, no different than on Legislative TV, if my picture is up or any member’s is up, it identifies their Party affiliation for clarity to the public.

Again, not to dwell on it, but sometimes that can be a subject area where you may do advertising and it may be one of those grey areas that we have to look at. But indeed, I think it’s one of those areas that there was commonality and consensus as opposed to anyone thinking that there are individuals – now some individuals even with that provision do not identify with their Party particularly. Others will indicate as part of a government, “our government is”, or if you’re in Opposition, “the government should or shouldn’t”. Some of that may be interpreted as partisan, but, again, you’re elected to be either an advocate for the government or a critic of the government. It does become an area that can be clouded and I just wanted to note that.

If I can move to Recommendation 4.4, ownership by the province of assets purchased with public funds and having the inventory and the like. I know with that particular item it has always been one that most of us, and having others, don’t see any issue with this. In fact, it’s often, what do you do with the stuff as opposed to thinking there’s a personal gain. Also looking at the fact that under technology, I know I at least have five computers – three in my

constituency, one in my home office and one here at my apartment in Halifax – that all have printers associated with them that I don’t need when the day comes. One of the things is technology quickly replaces itself so there’s a staging of ages of computers.

When you looked at the technology, has anyone looked at the recycling or the factors of the life-cycle of equipment or is there just a general government depreciation factor on a piece of equipment today?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: We weren’t really addressing the issue of the depreciation value of the assets over time and realize that’s part of the factor in decisions on things. Our issue really was that the eventual ownership needs to be clarified, it needs decisions made on it and put down in writing so everyone is quite clear. We also felt that the current inventory, at least of significant items, should just be determined to be government property as a way of approaching for the future in terms of moving on.

MR. CLARKE: I think with that there’s no dispute in off times whether it goes into surplus for Crown assets in the province or not-for-profits in our community, whatever they may be. I fully concur that there is no need, when a member ceases to be a member, to continue to hold any of those possessions.

MADAM CHAIRMAN: You have a minute left.

MR. CLARKE: Okay, I’ll move to Recommendation 4.5, with regard to proper documentation and original invoices. Again, very legitimate, oftentimes when you’re dealing with local groups, I can think of the hockey tournaments we deal with and the local little brochures – a lot of that is just photocopied or off the local printer of the organizer. But anything for advertising, in my case the Cape Breton Post, you get an official colour copy of an invoice and indeed, having that backup makes sense. I know from the Speaker’s administration that they been very diligent in making sure that that is in place.

For instance, for local things, when you deal with local groups that may not be as formalized as mainstream media, I believe part of that would recognize you’re dealing with the local hockey or soccer group or community not-for-profit that is doing an event. The most important thing is enough information to back up the expense and the reason for claiming it. Is that correct?

MR. LAPOINTE: Yes, it is and there have to be reasonable rules but we feel that 95 per cent of the difficulties with documentation could be dealt with adherence to simple procurement rules I would use in government, generally speaking for staff. The use of original invoices and not photocopies, that prevents something going in twice. Simple controls and clearly understood and communicated to people and adhered to by staff would

eliminate 95 per cent of any possible errors that could occur that way. Then the other 5 per cent – a receipt that is lost or the only thing is a photocopy – can be dealt with on a case-by-case basis.

MR. CLARKE: I think my time is up, Madam Chairman and we’ll continue in the next round.

MADAM CHAIRMAN: Yes it is, actually. Thank you very much and with that I’ll turn the questioning over to Ms. Kent and the NDP caucus.

MS. BECKY KENT: Thank you very much, Madam Chairman. First of all I want to thank certainly Mr. Lapointe and the staff from the department for taking the time and coming in today and offering this opportunity certainly to us as Public Accounts Committee and to Nova Scotians. These are important opportunities for us to be able to assess and review those things that are so important to change and, recognizing that the report you’ve come forward with covers a variety of topics. Madam Chairman, I’ll be sharing my time with my colleagues.

I’m going to start, for my part of it, with the Office of the Speaker. My colleague actually in the Progressive Conservative Party highlighted most of your recommendations so I’m not going to get you to review all those again. A question that I think often comes to me whenever you’re dealing with something that could be considered when we use words like excessive or inappropriate and such like that, or any time you’re looking at reviewing and changing in a province, it is often thought well what are other provinces doing.

You noted that for a moment regarding MLA advertising but I’m wondering if you can expand on how Speaker’s Offices in other provinces, for instance, monitor MLA expenses? I know it’s a fairly open question and we have many expenses here but can you give me a sense of general practices that other provinces are doing that you would consider to be strong, to be viewed as maybe a template?

MR. LAPOINTE: I can say we have a general sense of standard practice in this area but we did not, as part of this, survey other provinces and do research on the systems that are in use in other provinces. I don’t know how much I could realistically comment, in terms of comparatives. There are a lot of ways that this can be handled but most of the things that we were recommending really had to do with basic practices that could be applied across the government and we’re really more comparing with how it’s done for senior management than for staff, in terms of best practices.

MS. KENT: So I guess a question relative to how is Nova Scotia shaping up compared to other provinces, we really don’t have – would you be able to answer that?

MR. LAPOINTE: We can’t really say. Without having done a lot of work in that area, I’d only be reporting hearsay and so on. We didn’t have to, for what we were doing, spend a lot of timedoing research across the country so I don’t really have a lot to comment on that.

MS. KENT: Mr. Spicer, you did note in an answer to my colleague in another Party about a reference to advertising in other provinces for MLAs, so perhaps you could give a little clarity on that.

MR. SPICER: Yes, as Jacques said, we haven’t sort of done a detailed analysis of how each province approaches various things. Now, I did talk to New Brunswick, as an example, because they are a similar size and noted specifically about the advertising and their rules around that.

As Jacques said, each province does things a little bit differently and each has its own merits and its own drawbacks. As you probably know, Newfoundland and Labrador seems to have taken a completely receiptable approach and, of course, there’s a big administration around that as well, so it is very difficult to say.

I think the real critical, important issue here is that whatever approach you take, that you have the appropriate controls in place and there is some analysis around what is reasonable and there are appropriate guidelines so that everybody knows what they can spend, how much and why.

MS. KENT: Thank you very much. With reference to the 15 years, that a review of this nature was done 15 years ago, I’m wondering – and I note you touched on it, the long-term management of a situation like this, to ensure that it doesn’t happen again. I wonder if you can offer some perspective on what can we do or what is it in your report that would suggest it’s not going to take 15 years before it’s reviewed again and that sort of thing?

MR. LAPOINTE: Well, it’s hard to say because, as I mentioned earlier, when is the appropriate time to look at something like this. It really depends on how big a risk it is and how it compares five years or 10 years from now with other areas that need to be looked at. As an office, we have to allocate resources wherever we feel they are best used. I guess over the years every time a decision comes to be made, we decided to go elsewhere.

What’s critical here with this one is that the policy decision to be made as to what the House wants as a system and that the reforms be made and an improved system be put in place to – whether there’s oversight from our office or not, if it’s well designed and is put in place and it’s well managed, then the kind of errors and findings that we had would not recur in any case. That’s the critical piece right now, to put in that reform.

MS. KENT: And those are those recommendations, which is basically – so I’m understanding it correctly, these recommendations that would be put in place would, in and of themselves, be that monitoring system to ensure that, you know, we don’t go astray.

MR. LAPOINTE: I could say that if the recommendations we made were put in place – and they’re not all-inclusive, some of them involve policy decisions being made and decisions being made as to what kind of system you want, what is allowable and what isn’t – but if the recommendations were put in place, I’d say the controls would then be pretty strong and the extent of any error in the system you could probably expect to be fairly small, the risk would be much, much reduced.

MS. KENT: Just so I understand how the process will go forward, when the Office of the Speaker and the IEB committee are looking at these recommendations and should they proceed, is there a role that your office would continue to play to make sure there’s an understanding, that they’re achieving the goals that are set out here?

MR. LAPOINTE: In effect, I’d have to say that now that we’ve made our report and we’ve provided the information, for the most part our role now is done. The information should be there for the decisions to be made and the action to proceed, which is not to say that we’re not available to the members of the House to discuss it at any time.

We feel we’ve provided the information. We don’t have a formal role at this point and we feel it’s time now for the House and the government to simply proceed, take action and put things in place.

MS. KENT: Thank you. Just one final question before I defer to a colleague. Why did you choose the areas that you have focused on through this report? I guess my question is, was it set out before you began your process with a predetermined section of areas that you’re going to focus on, or was that an evolution of as it unfolded you discovered areas that needed to be addressed?

MR. LAPOINTE: We do a fairly in-depth process of risk assessment of the government operations on a regular basis. We look as best we can at all of the operations of the government, public sector, the agencies and the different programs to determine where are the highest risks, according to our priorities of where we can best serve, where are the best areas that we can focus our energy. We produce a plan which can take us into – well, in fact, we have audits laid out that we could do that could take us through the next five years. There’s always more to do than we can, so we prioritize them and we produce a plan and try to determine ahead of time the areas that we think are the priority for the next couple of years and stay ahead of it. That’s how we determine where we’re going to go.

We’re always looking at it, so we constantly evaluate and as new information comes up, we modify it, we add things – we’ve even added on a request from this committee that

we’ve examined – and we say, okay, that’s a reasonable one on the basis of new information. Mostly we try to go with our risk assessment, our prioritization and stay ahead of it for at least a couple of years, and that’s where these come in.

MS. KENT: Thank you very much. Madam Chairman, I’ll pass the time to my colleague.

MADAM CHAIRMAN: Mr. Preyra, you have 10 minutes left.

MR. LEONARD PREYRA: Thank you, Madam Chairman. Thank you, Mr. Lapointe, and your team for a very thorough, very comprehensive report. We haven’t had a chance to digest all of the findings in all of the chapters, but certainly it’s very thorough and the recommendations look reasonable and sensible.

I’m going to focus more on Chapter 3, the section relating to P3 education, in particular the focus on contracts that were signed by governments in 1998 and beyond. It’s a very substantial part of your report, it looks at about $830 million that was spent at least in financial obligations that were taken up over a 20-year period. Essentially, your conclusions are that the contracts, as they were originally signed, had significant gaps in terms of audit functions, in terms of accountability, and you make a lot of recommendations relating to that.

I want to just ask you a few general questions at this moment because I understand we’re going to be having a follow-up meeting on this chapter where we will be calling witnesses to address specific issues. I’m not sure I understand one part of the report. It says there was an apparent $52 million gap between what it would have cost for the school board to do it, what was being charged to the school board to do similar services, and what was being charged under the P3 arrangement. I noticed in the Department of Education’s response that they dispute that and, to tell you the truth, I don’t understand that dispute. Could you explain to me what the source of controversy is there?

MR. LAPOINTE: I can understand it, it’s actually a complex area in some ways. While the specific amounts can be argued the facts are, in looking at it quite simply, the department pays payments that it calls payments for services for operations and maintenance of schools to the developers of a certain amount, with formulae that are very complicated and calculated every year. Some of these developers, in ones we were looking at, they subcontract the same operations back to school boards and in effect pay them less than they’re getting, and in some cases the school boards still make a profit on these.

Our issue is that according to the information we were given, these are payments for services and the board then keeps a large portion of it and pays the rest to school boards that actually do the services. There’s a gap, why is that so? That fact is not in dispute, the question is, why does that amount exist? It’s a very large amount of money. I have to say that

we estimated that conservatively for that period of time and it’s only for some of the boards. We’re not saying that it’s pure profit that they’re maintaining, we’re not saying what it is.

The school board is suggesting a lot of reasons why that would be and one of the reasons is that apparently their argument appears to be that in the original design of the contracts that they wanted to manipulate the numbers at that time in order to avoid putting these schools on the books of the province and incurring debt. So they wanted to make sure that it fit the technical accounting rules to be operating leases and not capital leases. Well, that’s all very well, that may be so, but I’m not sure that’s a good argument to be making. That being the case, they say in order to do that they lowered the capital lease – in other words the rent – and increased the operating amount. Therefore some of that so-called operating payment is actually rent.

[11:00 a.m.]

How much is rent and how much isn’t? We don’t know and they haven’t been able to say and there’s no documentation whatsoever about any of this. That appears to be what’s coming through in their response – we’ve asked them to show us, but that seems to be the argument they’re making. It may very well be that some of this is manipulation of numbers and some is profit that’s retained. All we’re saying is that there is a difference in the amount that’s retained by the developer and we’re not seeing why.

MR. PREYRA: Thank you, sir. That’s pretty strong language. You’re saying that in 1998 and 1999, the government may have manipulated its books to hide real costs and to show less expenditures of fewer obligations than were, in fact, committed at the time?

MR. LAPOINTE: We’re saying that in explaining why there is this gap, that the department is telling us that – they wouldn’t use the word “manipulation” – there was alteration of the numbers, say, to fit the rules at the time to avoid them being capital leases. In the end it all came to naught because, in fact, we disagreed that these were operating leases at the time. The Department of Finance also disagreed and then the accounting rules changed. They are actually all set up as capital leases today so there wasn’t any point to doing any of that. But there is, in fact, according to them, a certain amount of fudge factor, say, in those payments.

MR. PREYRA: Thank you. I have another question about the risk transfer and I think there were two types of risk transfers that you focused on. One was in terms of the construction of two schools that were transferred back to the school board and the other is in the service agreements themselves. Would you explain how that occurred or why that was allowed to happen under the contract?

MR. LAPOINTE: I think it’s possible to get entangled in a lot of theory on the concept of risk transfer. There are different kinds of risks being talked about here which are

possibly being mixed up. There’s the issue at the time that a lease is being made on the technical issues of transfers of risk to determine whether it’s capital or operating and these are accounting issues. We’re not talking about that. We used the word “risk” to refer to the simple risk of operating a school.

It might be easier to think of it as simply what we’re referring to in our report, that the developers transferred responsibility for operating and maintaining the schools back to school boards, with everything that that entails. So the responsibility includes whatever risk is involved in running a school to do with maintaining the staff, running the building, buying supplies. So we’re not talking about anything complicated, just simply the responsibility associated with that, that’s what we’re referring to.

MR. PREYRA: Thank you. I believe I have time for one more question, Madam Chairman?

MADAM CHAIRMAN: Yes, you do, you have two minutes.

MR. PREYRA: I’d like to ask you something about the current situation. As you know, we are required under some of the new contracts to assess the utility of engaging in a P3 type arrangement, in terms of considering it, not necessarily entering into it, under the federal stimulus package. I notice in your report that you talk about the future. What advice would you give to the government today in assessing P3 contracts? What kinds of things should we look out for? What types of things should we avoid? What lessons have we learned from that that you would say would guide us?

MR. LAPOINTE: Well, I don’t know if we want to generalize too much about the lessons that you want to learn on doing P3s generally. We did have a suggestion that at the end of these contracts decisions have to be made about what you do with these contracts. Do you buy the schools? Do you continue to lease them? Do you walk away from them? Do you engage in further contracts for operations or not? That has to be made ahead of time, by the way, according to the leases, so at that time when those decisions are made on these particular P3s, that the lessons of this report be kept in mind and in terms of that decision.

When it comes to contracts, generally speaking, you have to make sure that the terms of the contracts you entered into are properly made and have the protections that you need, have the kinds of clauses that you want to have in a contract and that it gives value to the province. I don’t know if that answers . . .

MR. PREYRA: Well, thank you, I was just looking to see if there is time for another question, but I think not.

MADAM CHAIRMAN: No, there really isn’t, it’s 11:05 a.m. right now. I appreciate your pause there, thank you very much.

Our second round of questioning will be longer than usual. I’ve allowed 16 minutes per caucus so we’ll begin with the Liberal caucus and Mr. Colwell.

MR. COLWELL: Thank you, Madam Chairman. I am looking at Recommendation 5.17, “The Department of Finance’s Government Accounting Division should monitor departments’ progress, including significant divisions within departments, in providing information to the Office of the Auditor General as detailed in the schedule of audit deliverables.”

You state that the Capital Markets Administration Division has difficulty submitting necessary documents on time. Did they give you any rationale why they couldn’t meet these deadlines?

MR. LAPOINTE: I’ll ask Ann McDonald to speak to that.

MADAM CHAIRMAN: Ms. McDonald.

MS. ANN MCDONALD: Thank you. When we start the audit we always provide the Department of Finance, specifically the Government Accounting Division, with quite a lengthy list of what we require to complete the audit within the time frame that they have proposed. This year for the first time we had difficulties getting the information from the Capital Markets Administration Division. The information that we obtained was late and often inaccurate and required correction. We did eventually work through it and we got the information that we needed to complete the audit.

We’re hopeful that in the future this won’t happen again with that particular division. We certainly note that the Government Accounting Division does a very good job of monitoring these requirements and their timely provision to us and certainly our recommendation – this is the first time we’ve noted this – is that in the future the incident we found with the Capital Markets Administration Division won’t be repeated.

MR. COLWELL: Do you feel that there are any inherent difficulties in the Capital Markets Administration Division that might make these deadlines an issue, or put differently, were the reasons for being late due to issues within the division or due to the nature of their work?

MS. ANN MCDONALD: The Capital Markets Administration Division is responsible for some complex areas. It is responsible for monitoring compliance with various regulations that the Liability Division undertakes, various transactions that the Liability Division undertakes. In addition, the Capital Markets Administration Division looks after the sinking fund assets that relate to the provincial debt. So certainly it is a complex area because it is dealing with foreign currency transactions and various accounting rules related to those transactions. In addition, they’re dealing with the trustees who look after these assets and

performing reconciliations between what the trustee notes as the value of certain assets and what the values of those assets are on the book.

I know that last year there was a change in the chief person involved with the Capital Markets Administration Division but I understand, as well, that the Department of Finance is endeavouring to more closely monitor that individual and that division’s output in general.

MR. COLWELL: Do you feel that’s adequate to address the issues you brought forward?

MS. ANN MCDONALD: We certainly are hopeful. I’m hopeful in saying that the issues we found last year were a one-off and that in the future the information provided by the Capital Markets Administration Division will be as robust and accurate as it has been in the past.

MR. COLWELL: How significant an issue is this? It’s a big financial situation for the province. Potentially, how large an issue is this, financially, for the province in general? Say, if this department had difficulties actually doing the job the way they should be, what possible implications could it have for the province financially? Could it be very severe? Could it be minor?

MS. ANN MCDONALD: Well, as I noted, the division does monitor and deal with some complex issues. One of the things that the division does is provide an estimate of sinking fund earnings that are an important aspect of the revenue estimates. Should those estimates not be made using proper assumptions, that could be significant. Because of the presence of a trustee looking after the sinking fund assets, generally speaking, I wouldn’t anticipate a material issue with respect to the province’s financial statements.

MR. COLWELL: So you’re talking more of a management-type issue rather than a financial and that’s reassuring, thank you.

I have a question here. The Teachers’ Pension Act, the problem you’re having auditing that situation now, there was some indication in a previous Public Accounts Committee meeting we had that that particular pension fund, as well as others, might have some financial difficulty due to the market conditions and other issues. Could you expand on the problems you’ve encountered trying to audit the Teachers’ Pension Fund?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: I can tell you where this originated. It was with an audit we were doing, it was a performance audit that you may recall on audit committees across the government and agencies in the core. They were one of the organizations that we selected to go in and look at that particular issue. It was at that time that they consulted their lawyers

and determined that we didn’t have a mandate to conduct audits in their organization. We’ve been looking at this back and forth since then.

I guess it’s a complex issue. We’ve gotten legal opinion on that, too, saying that, well, it’s not actually that clear. Changes were made in it, as you know, back two or three years ago and the nature of the fund was changed. The legislation went through some changes and at that time the references to our office were changed. It didn’t have to do with the financial statement audit, the audit of the books for one thing, we’re looking at if they’re subject to performance audits like any other agency and it’s simply not clear.

I don’t know what was intended at the time that the organization was set up, the pension organization. Was it intended that they would be outside the scope of the audit of our organization or not? At this point I’m not sure. It’s the government’s choice to decide whether we can audit an organization like this or not, in the legislation. We need to have that clarified. Right now it’s not certain and it has to be dealt with in some way.

MR. COLWELL: When you’re talking performance audit, what type of thing would you do with a performance audit in this particular – what would you be looking at in the Teachers’ Pension Fund?

MR. LAPOINTE: It’s a notional idea, it could be any performance audit that we might do on any program. So if we were looking at government-wide procurement practices and we picked some agencies to look at, or any other area that the bulk of our work is not the financial audit of the statements but the operations of government and looking at effectiveness and efficiency of programs in which we select where the risk areas are and we go in – these chapters that we have today, looking at electronic health records and looking at other things – we might select a particular kind of operation that affects something they do in there like the audit committees, in which they are one of the pieces.

The authority to do that is what we’re looking at – are they or are they not within the government umbrella of what this office can look at for any program in the future, that’s really the issue.

MR. COLWELL: This is a substantial fund we’re talking about here, a very substantial fund and the province does contribute substantially to the fund as well, as do the teachers at the present time. How important is it to do an audit on an organization such as this – and in particular this one – considering the sheer magnitude of, I would say, the resources that are managed?

[11:15 a.m.]

MR. LAPOINTE: My belief is that, and the reason we bring it up in the recommendation, these are in large measure public funds dealing with the pensions of – in

effect, the teachers are public servants, so that is a public interest and having the organization be subject to audit by the Auditor General’s Office, the same as any other public organization. They are very large and they affect the future of a lot of public servants, so we feel they should be within that umbrella.

I also believe that any changes that were made in legislation to exclude us, whether it does or not is unclear, but if there were, my feeling is that it likely was inadvertent. I can’t believe it would have been intended that this organization not be subject to audit. Perhaps it was, but then I think a policy is going to have to be made, a decision made as to whether that was what the government wants or not, and then make whatever corrections are needed to make it happen, to make it clear to us and to them as well.

MR. COLWELL: Have you talked to the Minister of Finance about this or the Department of Education to see if there’s a willingness to go back and have the legislation changed? I would think it was probably omitted or missed somehow when the legislation went through, rather than being an intentional way of doing that.

MR. LAPOINTE: We haven’t pursued at that level yet. We were still looking at it and engaging discussions back and forth with the plan. We mentioned it, at this point, the report came out so we did mention that recommendation that has to be dealt with, but we haven’t proceeded with that kind of discussion.

MR. COLWELL: The economic indicators that are approved by the Treasury Board and these indicators are then required to become public, so there’s a time frame which they should be released. The Department of Finance releases an economic indicator report on a very infrequent basis. To your knowledge, does this reflect on what is approved by the Treasury Board?

MR. LAPOINTE: Are you referring to the economic indicators that we put in Chapter 6?

MR. COLWELL: Yes.

MR. LAPOINTE: No, these indicators that we published come out of the information we find as we’re conducting the financial audit and we see a lot of different kinds of information. We developed these indicators to provide them with additional information that might be useful for people to see, just to see if they are of interest to the readers and provide a different view of some of the financial aspects around the province. They’re not required reporting, these are things we just thought we have the information, it would be informative to provide it.

MR. COLWELL: I would agree with that because today with the state of the world and the recession that we’re in and the key indicators, foreign exchange, interest rates, the

gas and oil prices and many other things that would really affect the province either negatively or positively, it would seem that the state of the economy as we move forward would be very important information, of course, for the government to know and then, again, the residents of the province to have an idea, especially if they’re a business trying to expand, hopefully, in the province and create more employment, and also enable the province to react to the real changing economic conditions, especially as we’ve seen over the last couple of years. In your discussions with government about this, has there been any indication that they might come out with more frequent indicators?

MR. LAPOINTE: I’ll ask Ms. McDonald to answer that.

MADAM CHAIRMAN: Ms. McDonald.

MS. ANN MCDONALD: Thank you. Again, to emphasize the point that this chapter is for information purposes and it is our initiative. The recommendations under PSAB for this reporting, it’s not required for financial information to be in compliance with GAAP. We haven’t made any recommendations with respect to more frequent or more volume of indicators to be provided by government in their own financial reporting. We have indicated to government that if they choose to provide additional indicators than what they do now, this type of information would be part of their reporting and that we would not provide this information – in other words, we’ll let them take this on.

MR. COLWELL: Has there been an indication that they might be interested in doing that?

MS. ANN MCDONALD: Not particularly at this point, we’re not getting the feeling that they’re going in the direction of more frequent and more volume in their indicators.

MR. COLWELL: How much time do I have left?

MADAM CHAIRMAN: Less than a minute, not much.

MR. COLWELL: That’s fine, thank you.

MADAM CHAIRMAN: It is difficult to start a new question at that point. Thank you, Mr. Colwell.

I’d like to turn the questioning over to Mr. Clarke with the Progressive Conservative caucus.

MR. CLARKE: I’d like to return to Chapter 4, just continuing on the dialogue we had. I want to thank the Auditor General and his staff for being available for the comprehensive side. One of the things starting, because there’s a bit of extra time, I’d like

to go to maybe the overview of the actual audit exercise itself. Oftentimes what gets missed in the findings is the amount of people who are involved with doing this. I know that the Auditor General had a team in and I’d just like to ask, how many people were involved with this particular audit exercise, I guess, more directly?

MR. LAPOINTE: I will ask Mr. Spicer to give you those details.

MADAM CHAIRMAN: Mr. Spicer.

MR. SPICER: Thank you. We had a team of approximately six there, sometimes it would have been maybe seven, sometimes five that would have been down at the Speaker’s Office for two months, I believe, doing the detailed work. We would have looked at approximately 2,400 claims in total, it was quite an exercise.

MR. CLARKE: With that, Mr. Spicer, I’m assuming there would have been a lot of dialogue, questions and going through that volume of paper with the actual Speaker’s Office administration staff, which would not be a large staff that would be entailed. I guess the reason for that is looking at these outcomes, but I’d like to establish, as well, that in your working with the staff there that you felt there was a competent, compliant and co-operative staff in place who you were working with to get to these findings.

MADAM CHAIRMAN: Mr. Spicer.

MR. SPICER: Absolutely, they were more than co-operative, yet they are a small staff. We had – maybe not on a daily but probably every two days – meetings with Jocelyn, the director there, about findings that we had, getting clarification. So yes, I’m sure it was a busy time for them and we certainly appreciated the co-operation that they provided.

MR. CLARKE: Thank you and I appreciate that. Just from the point of view, sometimes the front-line staff aren’t maybe appropriately recognized because I do want to recognize the staff because they always will have their jobs they are doing on a day-to-day basis, dealing with processing 52 constituencies, dealing with the audit as well as implementing changes by decisions of the IEB that were concurrent with process findings and stuff. I think just for the record, it is important to thank our staff for their patience and understanding and also the level of professionalism they bring to doing that job.

I’d like to continue going through the recommendations briefly just for my edification. I think we left it at Recommendation 4.5 the last with local advertising and just trying to deal with, how do you make sure, and I agree with appropriate compliance and paperwork to back that up. The reason I was noting that sometimes it’s not always as simple for some locally-based activities where the documentation often is, like I say, from community groups, not-for-profits we’re working with but understanding and I appreciate

the Auditor General’s point about being able to be flexible but, wherever possible, adhering to that. We agree with that recommendation.

With Recommendation 4.6, that the Internal Economy Board should examine and reform the system and practices for compensating members’ staff and making sure they are in accordance with federal regulations, I believe that has been done. I just want to clarify it for the Auditor General that the staff have implemented that through the Speaker’s administration, is that correct?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: That ties in, I guess, with the next recommendation to deal with it now. This is actually an area of considerable concern because it deals not only with members but with their staff and potential consequences to them. We had in effect a two-part recommendation – before the end of February, deal with the current year, as we know about, and make sure that all proper remittances are done and T-4s are done and whatever else has to be done for payments that have been made this year and that’s a technical issue, just make sure that everything is right for now. There is some urgency to that because, of course, the time is running out so we provided all the information that was needed ahead of the report, to staff, as you say, to get working on it right now. I understand they have been doing that and should be making those corrections.

MR. CLARKE: I thank you very much for that. Madam Chairman, one of the things that I understand as well is that ofttimes constituency assistants have been called upon to attend after-hour events whether it is evening, public meetings or weekend functions, you know the Legislature is in session – they are attending things and the member wants to duly reflect compensating for the extra effort. Now one of the things that may have to come to IEB is just looking at – we did make a move forward where before it was just payment by the member, it was very flexible in terms of what was there, to formalize that we had to recognize our constituency assistants and staff resource, to be consistent and that they are of equal value, regardless of the region of the province. With that, it may beg looking at, from the Internal Economy Board, what the current level of salary is.

The other aspect that sometimes doesn’t reflect over the course of time is the changing nature of the role of a MLA, the realities of modern technology and what they mean in terms of staff resource. I mean they are everything from the front end administrative worker to case worker to desktop publisher to community liaison and communications PR. So we expect a lot of people who previously were not even formalized through a proper pay structure; that was changed.

What I’m reading here is that possibly one of the things that needs to come is a look at the actual workloads, the changing dynamic of constituency work because it has changed in the nine years now that I’ve been involved. It’s different today than it was before and the

expectations on the MLAs, as well as their staff, continues to shift. So with that, I think I acknowledge and I appreciate and I agree with the Auditor General on that which takes you, as you say, to Recommendation 4.7, that it be done within the reporting period for this year, which is understood by our caucus and agreed upon.

If I could move to Recommendation 4.8 then, which is, “The purpose of per diems should be clearly established and communicated. Reimbursement for an expense should not be permitted more than once, whether the expense is governed by one or more Acts or regulations.”

If I’ve read the report quickly on that, it’s to make sure that someone is not dealing with a per diem and then separately claiming for meals, for example, in some other form of reimbursement. Is that correct?

MR. LAPOINTE: Yes, that’s correct and part of the difficulty is that with the ambiguity of the guidelines on a lot of these allowances, that it’s not really clear what a per diem is for. The members, for their own protection, need to have clear statements as to what is covered by what, so they know at least what they can claim for and what they can’t. I’m sure that’s the case with these per diems.

MR. CLARKE: I appreciate that clarification. Oftentimes it’s one where even, Madam Chairman, there’s another aspect of scheduling and meetings because the standard had been for per diems, when the House is not in session, for three days a week to deal with the travel and other things and we’re finding part of the changes where meetings are extending beyond a three day period or two day core period. Again, I think in acknowledging and understanding the Auditor General’s point that the Internal Economy Board may have to look at what entails the work of an MLA that has to come in, out of constituency time, that is over and above their other work. So I think that’s another matter that the Internal Economy Board, in dealing with these recommendations, needs to be cognizant of and to work.

[11:30 a.m.]

If I can move to Recommendation 4.9, and the final one, that late fees and other avoidable expenses should not be eligible for reimbursement to members, I can understand that and we appreciate that from an accounting point of view. I also know that probably where some of that comes from is that members are the ones paying up front for these types of expenditures and managing their accounts. However, the principle is one that is understood and it is something that, from a due diligence point of view, is going to be pertinent for people to stay on top of from the principle.

Sometimes the application of how it affects people can be different in just trying to keep up with the volume of work they have to do and accounting coming in. The basis that I also think it’s important to note is that in Nova Scotia, unlike we’ve heard a lot of the stuff,

Newfoundland and Labrador was the most recent national example, here, no matter what, you can’t overspend with your monthly maximum. So if your monthly maximum is – what is it, $4,800, or whatever the number is . . .

MR. LAPOINTE: Approximately.

MR. CLARKE: . . . $4,800. If you have $5,200 in expenses, you can only get $4,800 back. So the inability to overspend in this province, which may create – because some months may be bigger – but still it’s being mindful of the principle that late fees and other avoidable expenses are not claimable, I think that is understood and accepted as well. There may have been other reasons that people have experienced, by virtue of having to do the financial administration themselves but I don’t think that would be a deliberate effort for people not to be on top of doing that.

MR. LAPOINTE: I would say that regardless of principle, that part of the practicality of something like that is, once you have the reforms in place, having an effective claims payment system that works quickly, you can avoid, of course, a lot of, as you say, payments up front and then delays in getting a cheque. You make sure you have a system that refunds you very fast so then there’s no need for late fees to occur, as a general rule.

MR. CLARKE: If I could continue, the time remaining is . . .

MADAM CHAIRMAN: About five minutes.

MR. CLARKE: Okay, if I can just quickly – I know on Page 55 there’s just the graph that’s in there about spending levels and I’m noting $2,336,002 from June 2008 to 2009. Quickly, on a straight average, that’s coming out to $44,923 per constituent, if you just averaged out our constituency office.

Just going back to my other point, so all of these types of measures, and I guess when you looked at these aspects, one of the difficult things in interpreting some of these items – and I remember, Madam Chairman, in my past life as a Speaker of this Legislature – is understanding the dynamic between rural and remote members versus semi-rural, urban and the metropolitan areas. Oftentimes even people when they talk about HRM forget there are rural parts of the HRM versus the actual intense urban areas. That’s one of the things that creates in my mind, in noticing how MLAs operate and have to function – it’s very different from someone who has literally just a home office in a rural, remote area, versus somebody who has their main street location and doing that. So I don’t know how we will ever avoid having a varied use of constituency and in looking at that.

I guess my question is, when you did your audit process were you looking at expenses in light of the reality of individual MLAs and where they may be from geographically and how they operate?

MR. LAPOINTE: As you say, the needs of members are quite diverse and your circumstances are diverse, from the urban to the far reaches of rural areas or even the way you need to operate your own constituency service, and we took that into account. We weren’t suggesting that all requirements have to be the same and so we provided a lot of information about that diversity which you can see, especially in the tables and so on, for people’s information and to enable the discussions that will take place as to well, how much diversity do you allow – as much as possible, or put restrictions on it, or not. Those are policy decisions that can be informed by all of this data.

When we looked at the individual expenditures, we were looking strictly on the basis of process, the rules that are in place and what should be done regardless of the type of expenditure that it was. We were simply comparing it to the rules.

MR. CLARKE: Right. Madam Chairman, if I can just ask the Auditor General, as part of the audit process – and maybe Mr. Spicer, in terms of involvement – one of the things that comes up because the Speaker is deemed the administration and the Speaker, where there are disqualified expenses, period, which don’t reflect here, because there are things that are rejected as expenses. During that process, did you look at items in any of the files that would have been disqualified to get a context of the types of things were not acceptable right from the get go?

MR. LAPOINTE: I’ll ask Mr. Spicer to deal with that one.

MADAM CHAIRMAN: Mr. Spicer.

MR. SPICER: No, we only audited the paid claims. I’m not even aware if there is a file of those that have not been approved, but I do know that happens and, in fact, of course, we discussed again many things with Jocelyn during the process. So, in fact, yes, we know that happens, but we did not include as part of the audit those items that would not have been approved.

MR. CLARKE: Thank you. Part of that, Madam Chairman, is just the fact that I do believe there have been and are firewalls for what people may have looked at as being very legitimate, but not approved at a certain point in time. That is something that is subject to all political Parties and that’s part of the interpretation of what people would look at, at some of these expenses. I’m not here to condone or condemn how someone previously claimed, but there are areas where you look at it that it is different.

For instance, I know this is a reference, but I’m a calendar person and I use calendars in my constituency and work with other folks and it’s not calendars even with logos, it’s the legislative ones. So someone could look at that and say, well why did you use the calendars? Well, because people see it as an effective way of rather than, for instance, fridge magnets for less than $1, to get something out that connects with constituents, that’s usable with your

contact information readily available on it and also part of the communication, public relations piece you would have.

When you look at those things, I don’t mind on my own individual basis, just as much – I know there was a reference with gifts and protocol. Oftentimes we’ll get a number of things, I know we’ve had the mugs and different items that are used for the communities because of community events going on and they’d look for a door prize from the MLA, or there’s a silent auction going on because they’re trying to raise money and you would give a donation of that frame. I think what you’re saying as well, if I read this correctly, there is nothing wrong with doing that, but record that you have given it out and keep a log of who is getting what. Is that correct?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: Yes, I think that’s part of the issue and we’re pointing out some of these types of expenditures to point out the kind of variety and different types of spending that occurs and pointing out that these need to be examined and decisions made as to what is appropriate and what is intended to be paid through here and what kind of documentation is required to support it. So make those decisions about, well, if gifts are okay, what do you need to support that and then make the rules clear and then everyone knows, but then it’s subsequent to a decision of the House as to the types of things you’re going to allow through there.

MADAM CHAIRMAN: Thank you very much, your time has elapsed, Mr. Clarke.

For the final 16 minutes we’ll go to the NDP caucus. It’s Mr. MacKinnon, I believe, who will take the time.

MR. CLARRIE MACKINNON: Thank you very much, Madam Chairman. It’s certainly great to have the Auditor General and his staff here today. The first thing that I want to do is commend them not just on a good report, but a great report. We’re dealing with 59 overall recommendations that I think are well-founded and very reasonable in all of the areas you looked at. Having said that, I think in relationship to MLA expenses, your report is going to have an impact on all MLAs, present and future, so I commend you for that as well.

What I want to look at is the electronic health records, however, before doing that, I found something this morning and I want to jump back to March 31, 2009 and discuss that $20 million overstatement of surplus. I think that warrants quite a bit of discussion because when you look at the picture in relation to deficit surplus, a $20 million overstatement of surplus is a significant exaggeration, maybe even when it comes to closeness, a gross exaggeration of a picture. So what I want to know is some real detail in relation to that, some significant commentary on that.

MR. LAPOINTE: Before I ask Ms. McDonald to talk to you about that – she’s quite familiar with all of the details – just in terms of context, when we audit the financial statements, these are $8 billion statements and we use materiality levels that are quite a lot higher than that $20 million in terms of what we accept as errors in giving a clean opinion, which this received. There are always a lot of errors in any large statement like this, back and forth, going both ways, so differences of opinion.

They don’t affect the overall picture or the opinion, because they are relatively minor – and I hate to use the words “relatively minor” in dealing with something in the multiple millions, but in a technical audit of a financial statement that’s what occurs. They become more evident when you start comparing them not to the $8 billion total spending, but to surplus and the effect on surplus. An error like this that would have passed the opinion test can have an effect on surplus if you’re very close to being break-even and that’s why this one tends to stand out. But given that as context, I’ll ask Ann to try to answer your question.

MS. ANN MCDONALD: Thank you. Paragraphs 55 through 57 of Chapter 5 discuss in detail the nature of that error and specifically it related to the sale of $212 million U.S. of sinking fund assets in approximately October 2008. We have a difference of opinion with the Department of Finance on how that sale should have been recorded. In accounting jargon, there were translation gains and losses over the years of holding those assets that under accounting rules are allowed to be deferred and amortized. In other words, it sort of allows for a smoothing, the accounting rules don’t force you to take in the impact of significant swings in foreign currency rates in any one year and you can sort of amortize them over a period of time.

It is our belief that when those U.S. assets were sold, any accumulated, deferred translation gains or losses should have been recognized at the time of sale. The Department of Finance does not agree with our position on that, so consequently we determined this error to exist. The Department of Finance has indicated in their response that they’re going to review their policy with respect to the deferral of such gains and losses, and the recognition at the time of sale, to see if it needs to be changed. Our view is that the policy is not in accordance with Generally Accepted Accounting Principles.

MR. MACKINNON: So I think it’s safe to say that when you are talking about the billions of dollars in expenditure, that $20 million is not significant but when you are talking about a difference of opinion that will, in effect, have an impact on the final picture that is being presented, it is significant, is it not?

MR. LAPOINTE: The difference is the use of the word, what do you mean by significant? Yes, a $20 million difference is always significant in that it is a large amount of money. It’s technically not material, if I can use that word, in terms of the financial statements themselves because it’s a very small portion of a very large statement. However, in our minds it was significant enough that we felt they needed to make that correction.

[11:45 a.m.]

What you have here is a difference of opinion, you need to understand, between our office and that of the Department of Finance. They don’t feel it’s an error and we feel that it is.

MR. MACKINNON: Thank you very much. In relation to electronic health records, SHARE, we have heard words this morning – well planned and managed, within budget and reasonable expectations. Does that mean everything is moving along well for coming March?

MR. LAPOINTE: No, those comments refer to the development of the SHARE system, to the core of the EHR system. You understand we didn’t have recommendations to make about the management of the broader system and all the other components that eventually are intended to come on-line with this.

MR. MACKINNON: Now, we talked about six provinces and the federal government being involved in the process. That means there were – this is in the collaborative process – that means there were four provinces and three territories that were not involved. Is there any comment on why it wasn’t 10, 1 and 3?

MR. LAPOINTE: I can perhaps ask Evangeline to give you a little more information on that. The fact is that all the audit offices have their own criteria for which audits they feel they need to take on. Some of them thought – the majority of the provinces thought that well, yes, this is something going on now of significance in the province and felt they needed to look at it.

All looked at them in slightly different ways because of different issues in different provinces. Some of them felt that no, they had other priorities, that this might not be critical enough for them to look at, so it is really just differences among the provinces as to each looking at their own audit needs and priorities. That’s all it would amount to.

MR. MACKINNON: And we are probably far ahead of some provinces, no doubt, in this process.

MR. LAPOINTE: I don’t know if I can say we’re far ahead. It’s hard to compare all of the provinces because they’re all at different stages. I know the ones participating in this particular joint exercise are all wrapping up more or less in the same time frame, within the year. By the time the federal summary report comes out later on, I believe, everyone should have reported by that time.

MR. MACKINNON: So having examined the SHARE process and program, what are the benefits to Nova Scotians?

MR. LAPOINTE: I’ll let Ms. Colman-Sadd speak to that.

MS. COLMAN-SADD: At the end of the day the benefits to Nova Scotians of an electronic health record is for the Department of Health to determine. It was identified through Canada Health Infoway as an important initiative across Canada to try to get more information systems automated and to get more electronic health record systems. Some of the benefits are things like obviously if you live in Yarmouth and you move into the Halifax area or you come for a visit to Halifax and end up in an emergency room here, that your records are accessible, that your information is there. But at the end of the day in terms of a detailed analysis of benefits and whatnot, I think that’s the Department of Health’s responsibility to identify that. I think the fact that they believe it’s important is shown by the fact that the SHARE system was developed.

MR. MACKINNON: I think confidentiality of records is something that is a concern. I believe this is an extremely important question, are you confident that the SHARE program protects the health information of Nova Scotians?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: We did have some findings, some work still to be done on protecting privacy and security. The indication was that by the time the system comes on-line that, in fact, these issues would be addressed. So they were dealing with the issues that we were looking at during the development and are indicating that it will be handled, so those concerns should be just fine.

MR. MACKINNON: I had several other questions, but, as usual, the time expires quite quickly . . .

MADAM CHAIRMAN: You have a few more minutes.

MR. MACKINNON: I do want to bounce back to my colleague who has some unanswered questions as well. Thank you.

MADAM CHAIRMAN: For the last five minutes we’ll turn it over to Mr. Preyra.

MR. PREYRA: Thank you, Madam Chairman, they’re not unanswered questions, they were not asked questions. I want to come back to the subcontracts, what you would call the transfer of risk. It seems to me that what was happening there was a bit of a shell game where we entered into a contract with a private developer, the developer then entered into a subcontract with the school board, either for building the school or for services. I’m just wondering, in particular, looking at the Cape Breton-Victoria Regional School Board, I’m not sure how a school board can incur a deficit paying for services that seemed to have been

contracted and paid for before. Am I misunderstanding that? How does that deficit occur, given that one of the main objectives of this P3 contract was to reduce those costs?

MR. LAPOINTE: No, the deficit referred to in this case would be the cost of the school board in maintaining the school, versus the amount that they get of revenue from the developer to do it. Clearly, if the developer under contract pays the school board a certain amount to handle operations of the school, the only possibility – they’re never going to come on exactly – is they’ll spend more than that or spend less; they’ll either run a deficit or make a bit of profit on it. In this particular case they were not receiving – or they were spending more than they were getting from the developer to run the schools and that’s really what all that’s referring to.

MR. PREYRA: Right, but the developer was paid for maintaining schools and they subcontracted with the school board to do that without actually transferring the equivalent amount of revenues, which is a separate part of this report, which was not claimed by the school board. It seems to me that under this 1998 contract we were double-paying for services?

MR. LAPOINTE: To the extent of that deficit, the school board would have to pay for it by reducing services they would deliver elsewhere, so something else in their budget would have to be reduced in order to pay for that. The funds were actually coming, yes, they were paid to the developer, but since not enough came back to the school board, the school board would have to get those additional funds from some other program in the schools.

MR. PREYRA: I have a related question. I know there were a number of issues that you could not address or did not feel like you had the authority to address in this report and we’re looking at locations of schools and the construction of schools themselves and the awarding of that. This is more of a personal question than anything else, but when my children were at school they played soccer and they were not allowed to use school fields or they had to pay a separate supplementary fee to use those school fields. I’m wondering, was there anything in the 1998 contract that precluded that? School advisory committees say, well, we can’t hold a bake sale or we can’t sell things in the cafeteria because that’s a separate part of the contract and you have to pay for that separately, or the use of fields. Did you look at fees for services that were collected by school groups or community groups for the use of a facility that was essentially a school board facility?

MR. LAPOINTE: I will ask Mr. Spicer to address that question.

MADAM CHAIRMAN: Mr. Spicer.

MR. SPICER: We wouldn’t have looked specifically at the fees but I think that whole issue goes back to the lack of clarity of contract terms. It became obvious, I think, very early on that the contracts didn’t address many issues, one of which was community use of schools

with certain developers. So again, we wouldn’t have looked at what the fees were associated with that.

Now, eventually there was an arbitration and agreements made that addressed those but I think it goes back, again, to the contracts and the lack of clarity around those.

MADAM CHAIRMAN: You have one minute.

MR. PREYRA: Well, let me just say we had talked earlier, at the end of my last session, that one of the recommendations, of course, is that we should look carefully at these P3 contracts when assessing the end of these service contracts or entering the new one. I think the report is pretty clear and today you’ve provided lots of evidence as to why we should do that.

Just a quick question on the subcontracts. Are you saying that we should not enter into these subcontracts or they should not have entered into these subcontracts, or that they should have established better systems for recovering the costs associated with the subcontracts?

MADAM CHAIRMAN: Mr. Lapointe.

MR. LAPOINTE: We’re not making any comment on whether government should or should not have in the past engaged in P3 contracts or any other contracts. We’re saying when you engage in a contract then ensure that you do it well and that you enter into a good contract and make sure that all the right terms are covered in it. Then, when you put it in place, manage it properly, regardless of the decision to enter into one or not. When you do, do it properly.

MR. PREYRA: Thank you, Mr. Lapointe. Thank you, Madam Chairman.

MADAM CHAIRMAN: Thank you very much, Mr. Preyra, that does use up all of the time that we had available this morning. We have just five minutes left and there is no new business. I would just like to draw the committee’s attention to the next meeting dates. We will be meeting with our Subcommittee on Agenda and Procedures on February 16^th, the day before our next meeting of the full committee. At that time we’ll certainly be looking at upcoming subjects.

I think it’s important to note today that a large part of our work – and we heard this when we did our training a couple of weeks ago – a very large part of the work of a Public Accounts Committee is to work closely with the Auditor General and with his office, and the actual departments and agencies and other areas of government that are explored by the Auditor General.

We definitely heard in our presentation today a recommendation that we look at the P3 contracts in the Department of Education – that was a suggestion made by Mr. Spicer in his presentation – and I think that will definitely be one of the subjects we’ll be looking at again when we come to meet on February 16^th. So we’ll return with a list of suggested upcoming witnesses for this committee.

Our next full committee is on February 17^th and we had already scheduled the electronic health records, so that being one of the chapters we’ve looked at today.

With that I’d like to thank you very much for the thorough work that you’ve done and the report that you presented to us today, and thank you to all of the members who are here as witnesses today from the Auditor General’s Office. Thank you very much.

With that, a motion to adjourn, please.

MR. PREYRA: I so move.

MADAM CHAIRMAN: Done, thank you very much. We stand adjourned.

[The committee adjourned at 11:57 a.m.]