Terry Paddon also flags lax fire inspections at personal care homes and nutrition gaps at long-term care centres in a 379-page review of government departments and agencies released Thursday.
He found that about $29 million spent by Transportation and Works on outside advisers often did not follow government hiring guidelines.
The result was a lack of a competitive, open process over three years ending in March 2014 as more than 70 consultants worked on 16 construction and other projects.
Paddon reviewed contracts over that period worth more than $100,000.
He said department procedures did not include getting Treasury Board approval, as required by government guidelines, for several payments that exceeded 110 per cent of original contracts or more.
Finance Minister Ross Wiseman told reporters outside the legislature that there's no excuse for not following internal policies.
"That's not acceptable," he said of one payout that was 4,000 per cent of the original contract, according to Paddon.
The auditor general also reports that five long-term care homes in the province often failed to meet nutrition standards, provide prescribed meal plans and supervision and serve food at appropriate temperatures. It describes a range of staffing issues and lack of equipment such as base plate heaters.
At the Corner Brook Long-term Care Home, a meal tray sat beside a resident's bed for 25 minutes before a nurse was free to offer required help, says the report.
Paddon also flagged personal care homes that lacked fire preparedness.
In eight of 50 cases examined, health officials renewed licences for personal care homes "even though critical deficiencies identified in the fire and life safety inspection reports had not been corrected," Paddon found.
He recommended a yearly plan to identify the number of homes that should be monitored according to related risks.
His review of 54 routine inspection reports involving 30 homes found 150 "critical deficiencies" in 21 of those facilities.
They included fire alarm systems in disrepair, outdated fire alarm certificates, emergency lighting system failures and broken fire doors.
Paddon said during a news conference that the importance of fire and evacuation readiness was underscored in January 2014 when widespread power failures meant many elderly residents had to be moved to locations with heat and light.
Service NL Minister Dan Crummell said while personal care home inspections are carried out at least once a year, operating standards and inspection programs can always be improved. He said the government is working to adopt the auditor general's recommendations.
"Personal care homes must meet the daily needs of individuals who can no longer live independently and so it is important for residents and their families to have confidence that the service is provided in an acceptable manner," Crummell said in a statement.
Paddon's sweeping report includes 71 recommendations in all.
Newfoundland and Labrador depends on offshore oil for about one-third of its revenues. The fall of Brent crude prices blew a hole in provincial finances with a $1.1-billion deficit forecast this year.
Wiseman said Paddon provides a valuable check and balance on spending.
"There are areas throughout government where we don't do a good job of evaluating programs and services on an ongoing basis to ensure they meet the objectives," he said.
"We need to be much more ... sharply focused on ensuring that we're consistent across all program areas and all departments."
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