In the wake of the latest revelations of financial mismanagement in the provincial government, SRBP has been looking at some of the possible contributing developments over the past decade or more.
Last week, SRBP noted that it appears the provincial government broke up the treasury board secretariat around 2007. They sent some of its bits off to one department and put the rump of its administration – about the size it had been in 1968 - under the finance department, as it had been before the 1973 reforms introduced by the Moores administration.
At around the same time, the provincial cabinet started a series of massive annual increases in public spending that Premier Kathy Dunderdale admits is unsustainable.
And the same cabinet also ballooned the size of the provincial public service. Again, it’s something that Kathy Dunderdale admitted was something she and her colleagues now had to sort out.
These three things are connected.
Even if the government loosened the constraints of its internal financial controls, there are other agencies that have a role to play in keeping an eye on the public treasury.
In Western democracies, the government gets permission to collect money and to spend it from the citizens’ elected representatives. It’s one of the basic roles for the legislature.
You can readily see the basic elements of the system in the United States. The executive branch is the government, represented by the President. He submits his budget to the legislative branch – the House of Representatives and the Senate – for their approval.
In Canada, the federal and provincial legislatures are modelled after the British parliament. The members of the executive – the cabinet – actually sit in the legislature. They get to form the government because they can get the support of the majority of the members in the legislature.
And while all the members of the legislature have responsibility to approve or disapprove of government spending, tradition holds that the opposition plays a key role. Here’s how one former Leader of the Opposition put it:
we will discharge that great responsibility that all oppositions in the British parliamentary system have: to make sure that government fully and completely accounts to the electorate for the expenditure of taxpayers’ funds, for the use of taxation authority, and for the management of the public affairs of this province, and we will not waver in our duty to ensure that they fully discharge the total responsibility with which they have been entrusted when they were given the awesome powers of being a government.
Over the past decade, though the Conservatives in Newfoundland and Labrador have reduced the legislature to little more than a rubber stamp. The House sits for fewer days on average than at any time since Confederation. The legislature sits for fewer days on average than any other provincial legislature in the country.
Political scientist Alex Marland put it this way:
The House is closed 88 percent of the year and talk radio has effectively replaced it as the people’s voice. Legislation is not sufficiently scrutinized: the committee of the whole is greatly overused, there are too few opposition MHAs to assess bills sufficiently, and standing committees are embarrassingly underused to the point of being dysfunctional. ...
The annual budget debate is seldom more than the bare minimum required by the legislature’s standing orders. Opposition members get almost no time to study the budget documents before the government starts sessions of standing committees that are supposed to review the Estimates in detail and then examine other legislation throughout the year.
The result is that the committees become nothing more than ad hoc arrangements that put on a performance solely for the sake of appearance. Ministers and their senior staff appear, present brief statements, answer a few simple questions, and volunteer no meaningful information. Since the make-up of committees never stays the same each year and since the committees meet only for the pro forma of the budget debate, members know little of the subjects they are supposed to keep an eye on. If they don’t know what questions to ask, it is almost impossible for them to ever understand what information the budget documents contain.
Besides scrutinizing the annual government budget, the legislature is supposed to have another committee - the Public Accounts Committee or PAC - whose responsibility is “ to hold government accountable for the stewardship of public assets and the spending of public funds.” That’s a quote from a news release announcing the appointment of the deputy minister of finance to the position of Auditor General.
You’ll find a similar description of the committee in Chief Justice Derek Green’s report into the House of Assembly patronage scandal (2007). Green identifies the PAC as a contributing factor in the scandal. One of the reasons: the committee didn’t meet very often. According to Green, the committee met only 14 times between 2000 until 2006 (Ch. 4, p. 48).
In light of the recent revelations of financial mismanagement by the provincial government and its agencies, it’s interesting to note that the Green Report notes that the PAC did not meet at all in 2004 and met only once in each of 2005 and 2006.
Green recommended that the legislature reinvigorate the PAC. While the governing Conservatives may have taken other steps Green recommended, they flatly evidently rejected his advice about the Public Accounts Committee. According to the House of Assembly website page for the PAC, the committee has not met at all since then. In February, CBC reported that the committee has held private meetings.
Coupled with the apparent weakening of internal government spending controls, the deliberate policy by the majority party in the legislature to shut down the Public Accounts Committee significantly reduced public oversight of the government’s spending at the very time they ramped up spending to unprecedented heights.
Weakening the House of Assembly and effectively dismantling its financial oversight committee was apparently as much part of the Conservative’s deliberate policy as was their unsustainable public spending.
-srbp-
