POLITICS

Nova Scotia premier rejects auditor's call for review of convention centre

11/21/2012 01:12 EST | Updated 01/21/2013 05:12 EST
HALIFAX - Another review examining the prospects of the $500-million convention centre in Halifax isn't necessary, Premier Darrell Dexter said Wednesday after the Nova Scotia auditor general criticized the government's analysis of the project as weak.

In his biannual report released Wednesday, Jacques Lapointe said 10-year market projections for the downtown development that were prepared by Trade Centre Ltd. lacked appropriate analysis, given the size of the proposal.

Lapointe said the Crown company's 2010 analysis included growth and market share assumptions that weren't adequately supported, and factors such as the abundance of convention centres in Canada, new competitors and a stagnant convention market were ignored.

"It was simply in fact too shallow to have much certainty," Lapointe told a news conference.

He said it wasn't clear how Trade Centre would lure investment away from competitors in bigger markets at a time when North America's convention industry is struggling.

"The current international market in Canada is dominated by large cities like Montreal, Toronto and Vancouver," Lapointe said in his report. "In a stagnant or declining market, Halifax would need to attract business away from other cities as the number of available events does not seem to be growing.

"Other important factors impacting this market segment include the increased value of the Canadian dollar and the excess supply of available convention space. Trade Centre Ltd. has not developed a clear strategy that addresses these industry realities."

Lapointe called on the government to seek a second opinion on the convention centre, but it rejected that idea, saying it was satisfied with the projections provided.

Dexter said Trade Centre's analysis was a compilation of eight reports done by independent consulting firms.

"We obviously didn't feel we needed a ninth," he said, adding that prior to the start of construction, critics were complaining it was taking too long to get the project moving.

The NDP premier said he is confident the convention centre will be a significant contributor to the province's economy.

"This will be important not only to the city of Halifax but to the entire province."

Liberal Opposition member Andrew Younger said while his party supports the project, the government shouldn't dismiss the auditor general's concerns.

"By refusing to do that study, all they are going to do is erode public support that is out there for this project," said Younger.

The provincial and municipal governments have each committed $56 million to the convention centre, while the federal government has promised $51 million.

Lapointe's report also called out the Trade Centre for its financial and operational activities, saying they lack internal controls. He cited travel and expense claims that weren't properly documented, and said the corporation hadn't followed provincial procurement rules.

"A major overhaul of financial management practices is needed to achieve an appropriate level of professionalism in the management of this organization," Lapointe said.

Trade Centre CEO Scott Ferguson said he welcomed Lapointe's criticisms as an opportunity to improve the organization. He said procurement and travel expense claims have since been brought in line with provincial policy.

"I'm in a high-profile business ... and I need to operate in a very open, transparent and responsible manner," Ferguson said.

He said 12 of the report's 19 recommendations have already been met and the corporation was working to comply with the remainder by the end of the fiscal year.

Note to readers: This is a corrected story. A previous version said Lapointe's report was annual.