Auditor General: CanNor struggles with staffing, administration, office space
Aglukkaq says CanNor is “effective and efficient” — NDP critic says it’s “in disarray”
The Canadian Northern Economic Development Agency gives “effective and efficient” service, Nunavut MP Leona Aglukkaq, the minister responsible for CanNor, said May 6 in response to a less than flattering review from Michael Ferguson, the Auditor General of Canada.
Ferguson released his audit of CanNor May 6, within the auditor general’s spring review of federal government operations. The full report is available here.
Ferguson found that since its launch nearly five years ago, CanNor still struggles with the management of its economic handout programs.
“The agency’s administration of contribution agreements is weak, monitoring of recipients is inadequate, and the agency has not measured and reported on whether its programs are achieving their objectives,” the report said.
And CanNor did not properly manage its acquisition of office space, failing to follow Treasury Board guidelines.
In Iqaluit, where in 2012 CanNor rented a large amount of space at the Allavvik building, owned by Qikiqtaaluk Properties Ltd., the agency ended up with more space than it needed.
“We observed that as the agency sought to determine accommodation requirements for its headquarters in Iqaluit, it modified initial requirements, specified additional requirements, and revised downwards its office space requirements after construction on a new headquarters building had started,” the auditor general found.
The agency also had more space than it needed in Yellowknife and Ottawa and eventually gave up about one-third of its office space, the auditor general said.
Ferguson’s office also found there are more employees working at CanNor’s Ottawa office than at the agency’s Iqaluit office, which is supposed to serve as its headquarters.
And the CanNor president, Patrick Borbey, still works out of the agency’s Ottawa office.
So do two other key officials: a vice president of policy, planning and communications, and a senior advisor for Inuit community relations, the auditor general found.
And in August 2013, the auditor general found only 30 per cent of CanNor employees worked at the Iqaluit office, despite “concerted efforts” to find staff.
The agency is supposed to locate 45 per cent of its workers in Iqaluit but hasn’t been able to find enough people to work there.
“The agency told us that of 32 positions advertised for the Iqaluit office, only 15 have been staffed, including some temporary positions,” the report said.
CanNor’s Ottawa office houses about 35 per cent of the agency’s workers, even though only 10 per cent of CanNor’s staff are supposed to be based there.
“Officials told us that there is competition for a limited local pool of qualified candidates. They also told us that people located elsewhere in Canada were reluctant to move to Iqaluit,” the report said.
All this prompted Western Arctic MP Dennis Bevington, the NDP northern affairs critic, to accuse Aglukkaq of incompetence.
“The Auditor General’s report into the Canadian Northern Economic Development Agency clearly shows an organization in disarray,” Bevington said in a statement
“No wonder the agency is in disarray. All the decisions are being made in Ottawa, not the North. There is only one person responsible for this incompetence and that’s the minister,” Bevington said.
But Aglukkaq, in her statement, said she accepts all of the auditor general’s recommendations and that CanNor is working to carry them out.
“The agency is committed to ensuring effective and efficient service to all three territories and is continually improving its business processes to better serve the North,” Aglukkaq said.
Her statement also recites CanNor’s spending record since 2009: $185 million in spending for 910 projects scattered across the three territories.
That includes $27 million over five years through the Northern Adult Basic Education Program, which in 2012-13, paid for about 60 programs that reached 800 adult learners, Aglukkaq said.
The auditor general looked at six NABEP programs that CanNor handled in 2011-12 and 2012-13, involving 42 projects, and found the agency did an “adequate” job in assessing the eligibility of program recipients.
But at the same time, CanNor did not monitor the programs to find out if adult students were actually gaining literacy or numeracy skills.
These included courses given by elders on traditional clothes and traditional culture.
“We did not see evidence that officials challenged recipients regarding the eligibility of these courses or questioned how the courses would improve literacy and numeracy,” the auditor general said.
In another funding scheme called the Targeted Investment Program, the auditor general found the agency did adequate assessments on 23 of 25 randomly selected handout recipients.
But in one of the two projects that flunked the audit, the agency did not clearly state what the money was for, after the recipient had already received government funding for a business plan and the development of tender-ready documents.
“In 2011, officials assessed an application requesting additional funds to take the project forward to the construction phase. Instead, officials approved funding for another study of the project’s potential economic benefits,” the auditor general found.
And in one TIP project, an invoice for a $31,000 truck went missing and auditors found a receipt for a $7,000 truck that was not invoiced.
And in the Community Economic Development Program, CanNor did an adequate job in only three of 11 projects.
“For example, one application simply stated that funding was for business support for a convenience store, motel, and gas bar without specifying the activities to be carried out or the expected results. The agency did not ask the applicant to provide the missing information before completing the assessment and funding the project,” the auditor general said.
As of August 2013, about 25 per cent of CanNor employees in Iqaluit were Inuit, well below the agency’s Inuit employment target of 50 per cent.