HANSARD

Printed and Published by Nova Scotia Hansard Reporting Services

Ms. Maureen MacDonald (Chair)

Mr. Chuck Porter (Vice-Chairman)

Mr. Keith Colwell

In Attendance:

Ms. Charlene Rice

Legislative Committee Clerk

HALIFAX, WEDNESDAY, OCTOBER 3, 2007

SUBCOMMITTEE ON PUBLIC ACCOUNTS

9:00 A.M.

CHAIR

Ms. Maureen MacDonald

MADAM CHAIR: I guess since we're all here I'll call the meeting to order. It's nice to be back to see everybody. We have our potential list of witnesses in front of us. On the agenda, first of all, is to set the list of witnesses that we'll recommend to the committee. We did have a few things left over from before.

We also have a new clerk who I would like to welcome and introduce. I don't know if you've had an opportunity to meet Charlene, but this is Charlene Rice and we welcome her and look forward to working with her.

MS. CHARLENE RICE (Legislative Committee Clerk): Thank you.

MADAM CHAIR: In the past what we did was have our lists and we essentially took from each list in a rotation, we've tried to rotate from caucus to caucus. That seems like a reasonable thing to continue to do unless there are some strong objections to doing that. That's the first thing.

The second thing I'd like to tell my colleagues is I had a chance to meet with the Auditor General this week and there were two things he wanted me to bring forward to the subcommittee. The first is that his next report will be coming out in January and he asked us to consider giving him two dates in January now, setting those aside, one for an in camera and one for a public hearing on his report. So this is one thing that he asked us. In the discussion on that, he and I thought it would be prudent to look toward the end of January, maybe the last two weeks of January, set those aside.

The other thing is he talked about whether or not we would be bringing forward other chapters of his previous reports that we have not had in public hearings, that we've had certainly in the in camera sessions, but an opportunity to discuss those further. I had indicated to him that some of those items were going to be on our list, on the list of things that the NDP caucus would be bringing forward. For example, the Department of Justice, maintenance enforcement was a chapter; wait times in health care certainly was a chapter that was left over; and so on. I told him that I would bring that forward to members of the committee. From there we will have the discussion and decide on what the priorities are.

How would you like to start? One of the questions I have is, the list that we have with the different items on it, have you given us the items from the PC and Liberal caucuses in order of your priorities?

MR. KEITH COLWELL: That's a yes for us.

MADAM CHAIR: That's a yes for you and a yes for you and it's a yes for me, as well. I see that the Atlantic Lottery Corporation is a priority as well, it's one of the higher priorities for us.

MR. COLWELL: And it's left over from last year.

MADAM CHAIR: Yes, it's left over from last year.

MR. COLWELL: The only thing I would like to see with that and I agree with the Atlantic Lottery Corporation, especially in light of what they've done, and I think all Parties in the province should be very concerned about this. It would also be nice - our No.2 is really tied into the No. 1 on our list - Parlay Entertainment Inc., because it would be nice to hear from the Lottery Corporation and also from this company to get the company's view on it as well, exactly what transpired, so we can get both sides of the story. I know we normally don't, but they would have to voluntarily come forward.

MADAM CHAIR: I think the problem is that the Public Accounts Committee brings in front of it government departments. I think we have to sort of stick within that. Now certainly we can inform the public and any interested parties that they will be in front of us and they can come and attend, be at Province House and have an opportunity to speak to members before or after, or to the media. To get into a public hearing, I think, is kind of beyond our remit as a Public Accounts Committee, that's what I think, that's my position. I think it's sort of a slippery slope, once we go down that path then where do we stop doing that? People will have an expectation of this committee perhaps in terms of our investigative powers, and what have you, that really doesn't reflect our resources or our capacity.

I fully support the idea of bringing in the Lottery Corporation and have them scrutinized for their practices, particularly if you want to look at what happened in this case.

I know that this contract has come to light recently and the company has talked quite freely about what their concerns are, and hopefully we'll have an opportunity to get information from them prior to coming. I don't think we can have making their case during the Public Accounts Committee.

MR. COLWELL: I don't disagree, Madam Chair, but the problem is there seem to be more and more of the questionable awarding of contracts by operations like the Atlantic Lottery Corporation within government at several levels. I agree that we really don't have the resources or the time, but if we don't hear both sides of the story on these things, you hear one side of a story and you don't know if it's all factual, you don't know if there really isn't some hidden agenda they had why they did it like that. There may be a very good reason why they awarded it to a different company without a tender, I can't imagine that, but maybe there is. To hear the whole story would be very interesting for a change, especially in this one situation. This is a big contract - neither company is a Nova Scotia company, so it's unusual. I'm aware of other contracts that have been let the same way, with the increase in contracts without tenders and other things happening, so it's time that these things were reviewed.

This is public money we're dealing with one way or the other and instead of having them before the committee maybe there's some other way we can get the information from the company and find out what it is. Maybe they can do a presentation, prepare a written presentation that we can have as committee members or something like that. They may be willing to do that, I don't know, I haven't personally talked to them, but maybe there's something, because that's information that I think is very relevant to the awarding of this contract. I wouldn't want to see this slip through the cracks and us go without the information we need to really investigate it.

Many years ago in Nova Scotia, when we were in government, we threatened - it was more than a threat - to haul out of Atlantic Lottery Corporation because we weren't getting our fair share of the revenue as compared to the sales in Nova Scotia. They buckled eventually, I think after the eleventh hour they buckled and decided, okay, we better change this, so it's an operation that's questionable at the least. I think it's important that we somehow get that information. If we can get that information any other way, that's fantastic, and we should have it before the Atlantic Lottery Corporation comes in. I think we should have the Atlantic Lottery Corporation in almost immediately.

MADAM CHAIR: Mr. Porter.

MR. CHUCK PORTER: I think that information is going to have to come from the request of the Atlantic Lottery Corporation, not through this committee. I don't think I agree with that, Madam Chair, it's not our mandate to bring in those folks. I do agree, Keith, that all of the information certainly would be pertinent and it should be asked for, but I think we need to make sure if we're going to get it we go the right route to request that information. I think any presentation or any explanation would be just fine, I'd be more than happy to look

through that and read any documentation provided. But I think that we should be following the right path, otherwise we'll just be flat out denied that information in all likelihood, in my opinion.

I saw a very brief news clip late last night with an explanation to some degree, but we'd like to see something probably come before this committee on paper at least or something, I'm not opposed to that. I just think that we make sure we do go through, I would assume, the Atlantic Lottery Corporation to request, in bringing them in, all of the information, which is not something we haven't done in the past, to make sure that all information is required and that would be part of our request, I would assume.

MADAM CHAIR: I'm wondering about two things here. The first is, the request we had and the discussion we had sort of in a sketchy way before we adjourned for the summer about the Atlantic Lottery Corporation was really more focused on the question of gaming security. I think the entire Public Accounts Committee had actually agreed that we should pursue them but at that stage there were several reports that were outstanding and there was an audit that was being done. There was a forensic audit underway and I'm not really sure where that sits in terms of the forensic audit.

[9:15 a.m.]

Now we have this additional piece, we have an additional concern, which is around the awarding of contracts. I guess my question to you is, should we bring them before us and have two sessions or try to do it in one session? What do you think we should do?

MR. COLWELL: My opinion is it's a lot of information, but is it enough information for two meetings? I'm not opposed to two meetings, don't get me wrong. Quite honestly, when the Atlantic Lottery Corporation comes they are well rehearsed, well prepared and they tell us what we want to hear, I believe. They will tell us what a great job they're doing about the lottery wins and how they have it fixed and all this sort of stuff, I'm sure. I would think instead, of going to two meetings, maybe a longer meeting and have them in once. I wouldn't object to another hour in the meeting to do that, to give us lots of time to ask questions on the two topics at this point. You award the contract to a company, there aren't a lot of questions you can ask around that and as far as the review of the retail wins and all those sorts of things, again, that has been there for quite a while. I think a longer meeting would be better than two.

MR. PORTER: I would agree. I think with the list that we have two meetings is probably not reasonable, but if we had to go a little bit longer that would be fine as well. The answers will be easily provided to us and we may struggle to get through two hours, in all honesty, when we're looking to question, I don't know. I would rather do it in one than two for sure.

MADAM CHAIR: Okay, great. I would agree with that. Let's try to bring them in, get them scheduled early on. We'll have an opportunity to talk with them about gaming security, but also the whole question about how they award tenders. We'll ask them to provide the committee in advance the information that will help us understand the tendering process with respect to their relationship with this company that got the contract, as well as other interested parties and we'll see where that goes, we'll see what we get.

I want to go to the PC list and look at Immigration as your first priority. I'm wondering if you could explain who it is you envision that we're going to invite in.

MR. PORTER: I would simply think it would be whomever manages the finances within Immigration. We're talking here about funding support through immigrant settlement grants, whatever is there that we can - you know, $1.8 million to focus on rural outreach activities.

MADAM CHAIR: So this would be our provincial Office of Immigration?

MR. PORTER: Oh yes, absolutely.

MADAM CHAIR: Excellent. What I'm going to suggest we do is go in rotation through our lists. So we have the Atlantic Lottery Corporation, which was the Liberal's top choice and the NDP's second priority; we go to the PC top; then we do the NDP top, which is the Superintendent of Pensions; and then we come back to your third, the Resource Recovery Fund Board.

MR. COLWELL: That would be okay, but the thing is the Atlantic Lottery Corporation was left over from last year.

MR. PORTER: Are we going back to our leftovers and picking up there before we move forward or what is the plan here?

MADAM CHAIR: Well, so was the Superintendent of Pensions with the NSAHO. Our list of recommendations from today should be vetted through the full Public Accounts Committee to approve, but it doesn't make sense to call a meeting of Public Accounts just to approve our agenda. Let's say we have the Atlantic Lottery Corporation, that's our first meeting, and then we have our list of potential witnesses, they can approve it at the end of that meeting so we can go with a couple of these things, get them booked. We could actually book the Atlantic Lottery Corporation and the Superintendent of Pensions and then start through the rest of the list.

MR. PORTER: When is the plan to start back?

MADAM CHAIR: I would think that as soon as the clerk can start getting people scheduled in. She'll make contact with the Atlantic Lottery Corporation to see if they would be available - it's probably unrealistic to think that they could come next week and you're out of town October 17^th and the Liberals are out of town on October 24^th, so we'd be looking at October 31^st and that should give us plenty of time.

MR. PORTER: I just want to raise one other question if I could, Madam Chair, with regard to meeting schedules. I know from a recent conference that you and I both attended in Victoria, we are meeting a tremendous amount more than a lot of other jurisdictions. I'm wondering if we are meeting too much. I know we have a long list, but we never get through it anyway and I think that we're doing a good job when we're bringing people in. But giving that some thought, oftentimes we're rushed between weeks trying to get through certain amounts of information.

I certainly wouldn't mind seeing us go to maybe even every second week with this committee to allow us more time, but to also come in line with other jurisdictions and spend the time where it needs to be instead of just rushing people through for the sake of getting groups in and out. I think it's pertinent that we're bringing them in and getting the right amount of questions, the right detail and so on. I would just raise that for discussion.

MR. COLWELL: I wouldn't agree with that. I think Mr. Porter hit the nail on the head when he said we don't even get through the ones we have. I think it's important that we meet every week, as scheduled, because we haven't met all summer and we're not going to meet now until October 31^st, so really we have long breaks in between. I think it's important that we maintain our weekly schedule, I think it's important to do that because a lot of these things are topical things, they change all the time and we've interrupted our schedule for topical things that have come up which are very important. I think we should maintain where we're at.

MADAM CHAIR: I would like the other provinces to get caught up to Nova Scotia rather than go the other way. I think it's unbelievable that in some provinces their Public Accounts Committees hardly ever meet. I think one of the things that I'm concerned about, I'd really like to make sure we do have time to do a little more work with the Auditor General's Reports and at the same time find that balance of being able to look at some of those really pressing issues that are more current than maybe some of the audits that we have from the Auditor General, because those tend to be a little bit dated by the time the audit is done and the information comes forward.

We're going to lose September and October and December, who knows, and with the House not sitting, it seems to be a good opportunity for committees to be a little more active. I would like us to continue on with our weekly meetings and if it gets to be too onerous then we'll review that, but so far I think we've done fairly well.

I think the idea of having flexibility to extend a meeting to two and a half hours once in a while, if the materials that we're dealing with are more complex, is a good idea. I've really appreciated the co-operation of the members to do that from time to time, because I think it makes for a more robust process.

Anyway, let's get back to our list then and just make sure that all of the areas that we're bringing forward are, in fact, appropriate areas for the Public Accounts Committee. We'll give Charlene our direction on that.

MR. COLWELL: So what's our next topic? We've decided on the Lottery Corporation as number one.

MADAM CHAIR: If we do the Lottery Corporation we also have the Superintendent of Pensions left over from last time and it's on the NDP list as a priority, so I would like that to get scheduled as well. It would be a relatively easy thing to schedule, I would think, it has been quite some time since the Superintendent of Pensions has been before any committee.

MR. COLWELL: I would agree with that, no problem.

MADAM CHAIR: And then I would suggest that we do the Office of Immigration, that we bring them forward as well. Then we have the Resource Recovery Fund Board on the Liberal caucus list and we could schedule that.

I want to ask you a question. The Resource Recovery Fund Board, are they a private organization?

MR. COLWELL: They are directly responsible to the Minister of Environment and Labour, they report directly. They're sort of like a Crown Corporation, quasi, but they're directly responsible to the Minister of Environment and Labour.

MADAM CHAIR: Would we bring in the Department of Environment and Labour?

MR. COLWELL: As well? I don't think it's necessary, but if you wanted to there's no problem.

MADAM CHAIR: I guess I'm trying to understand. The subject is tire burning and related issues and I'm thinking about this in the context of Public Accounts and I'm thinking about it in relation to a government department.

MR. COLWELL: The issue with the tire burning isn't the tire burning, it's how they did the request for proposals on that and how they evaluated them and if indeed it was an open and fair process. There is some concern with some individuals, other companies, that had ideas for tire reuse, recycling, whatever, that really didn't get very far. That's really the

issue. It's not the actual burning of tires that we're going to talk about, because that's an environmental issue. There are some other related issues with the Enviro-Depots that work directly for the Resource Recovery Fund Board that need to be discussed and brought into the open.

MADAM CHAIR: Right. I'm not saying it's not a good issue, okay, my question is how does this fit into the Public Accounts Committee mandate? Again, we have to avoid bringing in industry groups - we can't bring in non-profit organizations, for example, the VON is a good example . . .

MR. COLWELL: Yes, but that's not an arm of government. This is definitely . . .

MADAM CHAIR: This is definitely - okay, fine. We could schedule them following Immigration, and we'll make that recommendation.

MR. PORTER: That would take us through the month of October easy enough, I think.

MADAM CHAIR: No, that will be November, gone. I think one of the things we should do, and especially I think this would be helpful for Charlene, if we have enough topics to be scheduled in advance, I know that was one of the things that Mora liked and certainly Rhonda would have appreciated it for her planning, it really makes a big difference in pulling together information and stuff like that. I guess we won't be able to say precisely how far we'll go into December, but I doubt very much we'll go too far into December. We generally finish the end of November or have one meeting in December in my experience, we don't do more than that. Then we'll start up again in January and I think we've basically agreed to set the last two Wednesdays in January aside for the Auditor General, so that would be January 23^rd and 30^th. We could think about having a Public Accounts Committee meeting on January 16^th, we'll all be back from the Christmas holiday by then.

[9:30 a.m.]

MR. COLWELL: That would be no problem.

MADAM CHAIR: Maybe if we try to get enough subjects today, enough potential witnesses between now and the end of January, then we can have a subcommittee meeting sometime in January to look forward beyond that. Is that okay? Great, perfect, and some of those are on the list. So we definitely have a good chunk of November covered, if not all of November.

If we go back to the PC list, the next item is the Emergency Management Organization.

MR. PORTER: I'm just looking at the potential list of leftovers. Have we included the Department of Health wait times in that yet or is that still hanging?

MADAM CHAIR: We haven't, it's still there, I think. It was one of the Auditor General's.

MR. PORTER: So are we leaving that in?

MS. RICE: You had mentioned Justice, maintenance enforcement and DOH wait times.

MADAM CHAIR: That's right, yes.

MR. PORTER: Those are already part of the October-November list that we're referring to that are government?

MS. RICE: The end of January, I understood.

MADAM CHAIR: No, the end of January is going to be the new Auditor General's Report, the January Auditor General's Report. We'll have an in camera session with him and then we'll have a public session with him on that report, but in addition to that there are topics that were left over. There are way more topics than three, actually and it's really up to the committee to try to decide if you want to deal with those or not, or which one of those would you like to deal with, that kind of stuff. I see some of them are somewhat reflected here already on some of the lists that we have.

MR. COLWELL: I might suggest, perhaps, that if Mr. Porter would like to suggest that the wait times be moved up to one of our meetings from our leftover list, I would support that.

MR. PORTER: That's what I'm suggesting, I think we should be looking at . . .

MADAM CHAIR: Right now we have five possibilities and I'm going to ask the committee if you want to meet in December or do you want to finish the end of November? The last Wednesday in November is the 28^th.

MR. PORTER: That sounds fine, too. The end of November, especially if we're coming back for January 16^th.

MADAM CHAIR: Okay. Then we have two in January so really, if we could bring forward one more item then we could do that. I noticed that there are three Department of Justice topics, two on the NDP caucus list and one on the Liberal caucus list. One of those, maintenance enforcement, is left over from the AG's Report. No. 5 on the NDP caucus list

and No. 6 on the Liberal caucus list are actually very similar. I put this here and the focus that I was looking at is around whether or not the Department of Justice and the Public Prosecution Service have adequate resources to deal with crime, crime prevention, those kinds of things - there is a connection. We might consider scheduling Justice to come in and speak to that. It's an important public issue, so why don't we make that our January 16^th item? Perfect.

The rest of these items we'll just keep on file for our ongoing discussion when the subcommittee meets again. Is that agreed?

MR. COLWELL: Agreed.

MADAM CHAIR: Okay.

MR. COLWELL: We should also talk about a subcommittee meeting again, probably January 16^th, so we have time for the clerk to get past whatever we want to do.

MR. PORTER: At 8:30 a.m. maybe?

MADAM CHAIR: Yes, we could meet prior to, is that agreeable?

MR. COLWELL: That would be fine.

MADAM CHAIR: We'll meet half an hour ahead of the Public Accounts Committee, okay.

MR. COLWELL: Maybe we can exchange lists in early January so we can see if we have some common ground there.

MADAM CHAIR: Excellent, if there are any changes. One thing I would like to raise before we leave, we had put on our list the former head of the Agricultural College who resigned, Philip Hicks. My understanding is he is out of the country, he's in Dubai, and I don't know if there will be any possibility of his ever coming in front of the committee, if he has plans to come back. It would be nice if we could write him in advance and find out if he has any plans, because then we would either just take him off the list because he's not coming back, or he is coming and when and then we could have the discussion about whether or not we would bring him in.

The Agricultural College, as you know, is a really important institution and he was very direct in some of the concerns he had when he resigned. I think it would be useful to hear from him. I guess what I'm asking is whether or not we could write him and ask him if he has any plans to be back in Nova Scotia anytime soon, in the event that the Public Accounts Committee would have him speak to us.

MR. COLWELL: The only concern I have about that is we don't have him scheduled for anything, we didn't choose the Agricultural College to investigate at this point. I have no objection to investigating them, so I think until we decide whether or not we're going to put them on the agenda, I think it's a little bit premature to do that. I can understand where you're coming from.

MADAM CHAIR: You know the problem is, of course, when we have the discussion this will become, is he ever coming back, and then we'll have to . . .

MR. COLWELL: But it may never get on the list.

MADAM CHAIR: Yes, that's true.

MR. COLWELL: So I would say for now this is something we could bring forward in January when we meet again. That would be my opinion. Bring it forward in January and then there's still lots of time, because we have lots of topics that we can go through prior to that if indeed he is coming back - he may never come back.

MADAM CHAIR: Okay. Is there any other business?

Hearing none, we stand adjourned.

[The subcommittee adjourned at 9:39 a.m.]