06/08/2015 12:05 EDT

Senate Expense Audit: Leo Housakos, James Cowan Repay Money, Deny Wrongdoing

OTTAWA - A scathing report on the spending habits of Canadian senators suggests there's a strong sense of entitlement among members of the upper chamber, many of whom often ignore "economical" options that would save taxpayers money.

Auditor general Michael Ferguson makes the statement early in a highly anticipated report, coming Tuesday, that finds about $1 million in problematic spending after a two-year review of 80,000 transactions worth about $180 million.

"We found that the oversight, accountability, and transparency of senators' expenses was quite simply not adequate," reads the report, a copy of which was reviewed by The Canadian Press.

"We also found that senators did not always consider the requirement to ensure that expenses funded through the public purse were justifiable, reasonable, and appropriate."

From stopovers on the way home to the choice of flight routes, Ferguson's report identifies areas where senators could make decisions that are "more economical for taxpayers" — part of the "transformational change" he calls for in a report that reportedly carries a $21-million price tag.

Part of that report is now in the hands of the RCMP, who have been asked by the Senate to review the files on nine of the most cavalier spenders.

But the fallout won't end there: The Mounties are also expected to look at the 21 other senators named in the audit and their tens of thousands of dollars in dubious claims before deciding if they, too, warrant criminal investigation.

On Monday, a trio of top senators said they would repay expenses flagged in the audit, even though they felt they had done nothing wrong. Senate Speaker Leo Housakos, his deputy Nicole Eaton, and Senate Liberal leader James Cowan all said they would give up the right to appeal Ferguson's findings.

Together, they accounted for about $20,000, including Cowan's $10,000 bill.

Senate government leader Claude Carignan has also already repaid about $3,000 in questionable travel claims for one of his staff.

The trio faced tough questions from their colleagues last week over why, despite having been named in Ferguson's report, they were involved in setting up an arbitration process that gives senators a chance to potentially quash Ferguson's findings.

Housakos, Cowan and Carignan were accused of having a conflict of interest for setting up a process that could end up helping them.

Housakos said he repaid about $7,500 in all for travel by a staffer and contracts handed out through his office before he became Speaker because he didn't want to impugn the "integrity of the process or the manner in which it was implemented."

Cowan, too, denied any conflict of interest, saying he continues to "respectfully disagree" with Ferguson's claim that three trips to Toronto in 2011 were for personal events, rather than parliamentary business.

"I have taken this action solely to remove any lingering perceptions about the integrity of the arbitration process."

Eaton said Ferguson disallowed $3,489 worth of expense claims for four trips she made to her hometown of Toronto to attend meetings of not-for-profit boards on which she sits. In a statement, Eaton said she disagrees with Ferguson's conclusion that the trips were aimed at advancing her "personal interests."

Senate spending rules, she said, allow senators to charge taxpayers for trips that have a "public interest."

"I receive no remuneration of any kind for my work with the St. Michael's Hospital Foundation, the Pontifical Institute of Medieval Studies, the National Ballet of Canada and the Gardiner Museum," she said.

"Thus, I cannot see how it can be characterized as anything but parliamentary function ... and thus, community service carried out in the public interest."

She argued that Ferguson's definition of what constitutes a parliamentary function will hamper senators from engaging in community service in future.

A fourth high-profile senator went public Monday about being named in Ferguson's report, saying the auditor general doesn't have a "true appreciation" for the toll of regular, cross-country travel.

"Not only do Senate rules clearly allow for stopovers and overnight stays in the (national capital region) following the conclusion of Senate business, both are an intrinsic and unavoidable component of long-distance travel," wrote David Tkachuk, who chaired the committee that oversaw Mike Duffy's audit.

"It concerns me that if we were to accept the auditor general's opinion of my travel, we would be setting an unachievable expectation of senators."

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