06/09/2011 10:22 EDT | Updated 08/09/2011 05:12 EDT

Auditor General G8 G20 Report: Parliament In The Dark About $50-Million Fund; No Documents For 32 Projects In Minister's Muskoka Riding

CP File

THE CANADIAN PRESS -- The wording has been softened but the auditor general's verdict remains much the same: the Harper government kept Parliament in the dark about a $50-million G8 fund that sprayed money on dubious projects in a cabinet minister's riding.

The final report on the G8 legacy infrastructure fund concludes that the government "did not clearly or transparently" identify how the money was going to be spent when it sought parliamentary approval for the funding.

Moreover, the report criticizes the utter lack of documentation to explain how and why 32 infrastructure projects in the Parry Sound-Muskoka region in Ontario were selected to receive the government largesse.

And in a separate chapter, the auditor general says spending on operations and security for the G8 and G20 meetings in Ontario was presented piecemeal to Parliament instead of in a package, leaving MPs poorly informed about total costs.

But in one bright spot, the auditor general says it appears the initially budgeted $1.1 billion for the summits will actually come in around $664 million.

That's because poor co-ordination forced departments to over-budget and set up contingency funds that were not needed.

"When government presents a request for funds to Parliament, it should be transparent about the intended use of the money," said interim auditor general John Wiersema.

He added that he's "very concerned" about the lack of supporting documentation about the chosen projects.

"Supporting documentation is important for transparency and accountability."

The final report does not contain the inflammatory language used in a January draft, which baldly asserted the government had "misinformed" Parliament and suggested the opaque process for approving the funding might actually have been illegal.

That draft created a sensation in April when it was leaked to The Canadian Press in the midst of the federal election campaign, just hours before the crucial English-language leaders' debate. Prime Minister Stephen Harper's Conservatives promptly leaked a subsequent February draft, in which the suggestion of misinformation and illegality had been dropped.

Sheila Fraser, who has since retired as auditor general, implored voters to wait for the final report before drawing conclusions. She refused to release the report during the campaign, insisting it could only be tabled when Parliament was sitting.

Although the language has been toned down, the gist of the criticism of the legacy fund remains the same in the final report as in the initial draft.

The report details how, in November 2009, the government tabled supplementary estimates in which it asked Parliament to approve $83 million for a border infrastructure fund aimed at reducing congestion at border crossings. Parliament was not told that $50 million of that money was to be devoted to infrastructure projects hundreds of kilometres from the Canada-U.S. border — in Treasury Board President Tony Clement's Parry Sound-Muskoka riding.

"In our view, by presenting the request for funding in the supplementary estimates in this way, the government was not being transparent about its purpose. Parliament was no provided with a clear explanation of how those funds were to be spent."

The so-called legacy fund was supposed to help Clement's cottage country region prepare for hosting the G8 leaders' summit in June 2010.

"Projects were supposed to support the safe, secure and successful hosting of the summit by improving travel safety, enhancing the image of the region and improving the security of residents and visitors during the event," the auditor general's report notes.

Yet auditors were unable to find any documentation about how projects were selected or even why the government settled on $50 million for Parry Sound-Muskoka when cities that have hosted previous summits received no more than $5 million.

A total of 242 projects were identified by local communities and stakeholders as potential recipients of funding. Although Infrastructure Canada managed the legacy fund, it did not manage the application intake or identification of priorities for funding and, thus, could provide no documentation about how projects were reviewed or chosen.

And, while Treasury Board approval of the legacy fund had indicated that the summit management office at Foreign Affairs would be involved to ensure the needs of the summit were supported, auditors found the office was not involved in reviewing or selecting the projects and, therefore, had no documentation either.

The audit did not attempt to evaluate the 32 projects that received funding. But opposition parties have already had a field day enumerating questionable projects that appear to have little, if anything, to do with hosting the summit.

Among the most controversial were:

  • $274,000 on public toilets 20 km from the summit site in Huntsville.
  • $100,000 on a gazebo an hour's drive away.
  • $1.1 million for sidewalk and tree upgrades 100 km away.
  • $194,000 for a park 100 km away.
  • $745,000 on downtown improvements for three towns nearly 70 km away.