Auditor general praises Yukon reforms

Sheila Fraser doesn’t consider herself a giant killer. Canada’s auditor general laughed at the suggestion her damning 2004 audit, which…

Sheila Fraser doesn’t consider herself a giant killer.

Canada’s auditor general laughed at the suggestion her damning 2004 audit, which exposed the notorious “sponsorship scandal,” and ended the Liberal Party’s 14-year reign.

“I think that there are a number of factors that people consider when they make their decisions of who to vote for, and I would be very surprised that it was us,” said Fraser, who was the keynote speaker at a Yukon Chamber of Commerce luncheon in Whitehorse on Tuesday.

“Some people mistakenly believe that it is the auditor general who is government’s watchdog, but that is not the case,” she told more than 70 people at the Westmark Hotel during the $25-a-plate affair.

“Another misconception that some people have about my office is that we are a bunch of grumpy, miserly bean counters who put organizations under a magnifying glass to expose waste and so-called boondoggles, and discredit the work of public servants,” Fraser said, winning a laugh.

“A more accurate portrait, and one that reflects what we really do, is of dedicated, hard-working and highly-skilled auditors who bring to light information that we give to legislators in the service of sound management and accountability.”

Fraser’s power extends across the country to almost all federal Crown corporations and many regional ones as well.

More than 20 Crown corporations in Yukon, Northwest Territories and Nunavut open their books to Fraser’s office each year.

At the behest of the Yukon Energy Corporation, Fraser’s Vancouver office probed construction of the Mayo-Dawson transmission line in 2005.

It concluded the project was badly bungled.

“Mismanagement resulted in delays, cost overruns and design and construction work that did not match the corporation’s original plan,” Fraser said Tuesday.

“Another 2005 report that we did about the Energy Solutions Centres also detailed evidence of corporate mismanagement.

“In that audit, we found that managers’ decisions showed a disregard for good governance practices and principles.

“Specifically, we found that the centre awarded large contracts to two of its senior managers, made payments without proper supporting documents and moved forward with major projects without the approval of the board.”

Things have improved since those debacles, she said.

The Energy Solutions Centre was rolled into Energy, Mines and Resources and can no longer operate as an arms-length government agency.

And Yukon Energy revamped its entire contracting process.

“We looked at what processes we had in place for management of contracts and payment of invoices and how things were processed and who signed for them,” said Yukon Energy CEO and chamber of commerce chair David Morrison, who hosted Tuesday’s luncheon.

“We put in place a system that meets the standards, where the auditor had identified gaps in these standards,” said Morrison.

“People were signing for things without signing authority. What we’ve done, in many cases, is require two signatures now.”

The Yukon government has revitalized its public account committee and established an in-house auditing authority — both steps in the right direction, said Fraser.

“The Yukon government has done a very good job of adopting all of the new accounting policies, and has been one of the leaders in this.

“We’re very pleased with their attitude towards financial reporting, making sure that it is in line with standards.

“They are adopting these independently and objectively-set accounting standards.

“Government isn’t required to do that.”

Fraser came to the Yukon to meet with deputy ministers and plan audits for the next few years.

She wouldn’t say which Yukon Crown corporations are due for scrutiny.

Fraser and her colleagues perform two types of audits. Financial audits examine records and accounts, while performance audits examine initiatives of government agencies, like Yukon Energy and the Energy Solutions Centre.

They recently audited federal efforts to clean up toxic industrial sites, such as the abandoned Faro mine.

Implementation of First Nations land claims perennially falls under Fraser’s purview.

“We will be doing more on implementation of treaties, eventually,” she said.

Having spent two years as assistant auditor general, Fraser was appointed auditor general by former Prime Minister Jean Chretien in 2001.

She’ll hold the post until 2010.

Government agencies don’t need more rules, she said.

Most Canadian public servants are conscientious, and need flexibility to manage their programs, she said.

“If anything, there should be less rules. There should be much more principle-based decision-making.”

For example, a recent audit of the federal human resource system found no fewer than 70,000 rules, she said.

“When there are so many, they all become irrelevant.

“Many of the really serious findings that we found weren’t because of a lack of rules. The rules were all there; it’s just people didn’t respect them.

“Bringing in more rules and controls isn’t the answer.”