Politics

Senate looks for a way forward on expenses after years of scandal

Auditor General called for independent oversight of expenses — but some senators bristle at the thought

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Senators are debating how to implement the auditor general's recommendation for independent oversight of expenses, as it looks to move beyond scandal over spending. (Chris Wattie/Reuters)

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Many senators who lived through the auditor general's recent review of expenses say the process cost too much and took too long — but the next step could be trying, too, as senators argue over the best way to keep an eye on expenses without racking up huge costs.

The 2013-15 audit of senators' expenses led by auditor general Michael Ferguson cost some $23.6 million but found a relatively paltry $600,000 in ineligible expenses. (The annual budget for the Senate is just north of $100 million a year.)

The review, which examined every expense senators incurred over a two-year period, was a "colossal waste of money," in the eyes of Liberal Sen. Percy Downe, with a poor "return on investment."

Conservative Sen. Elizabeth Marshall, herself a former provincial auditor in Newfoundland and Labrador, recently said the whole affair was "so painful" in part because the auditor general didn't use "sampling" to find a pattern of abuse.

Despite those misgivings, the Red Chamber is now reviewing some of the recommendations the auditor general made with respect to expenses and oversight, in a bid to avoid future scandal.

Senate expenses AG 20150610

Auditor General Michael Ferguson, who led a sprawling review of Senate spending, has said the $23.6 million price tag for the audit includes costs his office would have incurred no matter what, including costs for salaries and office space. (Fred Chartrand/Canadian Press)

Members of the Senate's powerful internal economy committee, as well as other members of the upper house, are determined to turn the page — but also say they want to make sure any process implemented is worthwhile. The Senate has already beefed up public disclosure, posting quarterly expense reports online and publishing details of service contracts, the likes of which put Sen. Mike Duffy in the spotlight.

The House of Commons, by comparison, is much more secretive about spending.

But to really move forward, the Senate will have to wrestle with one of the auditor general's key findings — namely that senators should allow independent officers to rule on the validity of expense claims.

This has tossed senators, who have long sought to be masters of their own house, into a debate over just how much authority they should forfeit.

'A high-wire act'

Peter Harder, the government's representative in the Senate, is eager to implement changes the auditor general called for, citing what he sees as inherent flaws with the current structure.

"Faced with such an inadequate system, the public may be forgiven its cynicism ... In my view, to meet the expectations of Canadians, it is crucial that this new body have a majority of external members and a minority of senators," he recently wrote in Policy Options.

Harder, who was appointed by Prime Minister Justin Trudeau, believes it's possible to meet the imperative of independent oversight while respecting the Senate's right to self-governance.

"While this may be a high-wire act, it is achievable," he wrote.

But many senators bristle at the thought of outsiders holding that much power, deciding just how much they can and cannot spend.

Harder Senate 20161222

Sen. Peter Harder, the Trudeau government's representative in the Senate, says there should be an independent oversight committee for expenses. (Adrian Wyld/Canadian Press)

"We have to do the right thing, but there has to be a balance, we have to be realistic," Downe said at the internal economy committee's recent meeting on the issue of Senate expenses.

"Having experienced the AG's office in full flight, they did not come down from the mountain with recommendations that are beyond question. We have to take them with a big grain of salt given what they did to Canadian taxpayers when they did the audit of the Senate."

Policing expenses expensive?

A major problem is that the act of policing expenses can be expensive.

For example, the Senate ethics officer, who investigates conflicts of interest and ethical lapses, was allocated $1 million last year to pursue a handful of inquiries. The appointment of an independent auditor could cost a similar sum, if not more.

There is also a widely held belief that while some independent oversight would be welcomed, the Senate does not have to accept the auditor general's prescription to the letter.

Independent Sen. Grant Mitchell, who serves as Harder's deputy, is looking for a sort of compromise. He prefers a committee where outsiders hold a majority, but said he also wants the Senate to retain the right to reject its findings on expenses if it so chooses.

The Senate's subcommittee on estimates, chaired by Conservative Sen. David Wells, will study the issue, and propose a way forward. Recommendations are due by Oct. 26.

"Of course, there's a cohort of senators that don't want to give up full independence, because we're a self-governing body," Wells told CBC News.

David Wells talks about Ches Crosbie and John Crosbie fiasco

Sen. David Wells says oversight committee could study more than travel expenses. (CBC)

But he said an oversight body doesn't have to deal exclusively with wrongdoing, or policing travel expenses (which make up only $4 million of the Senate's total budget).

Wells favours oversight that focuses on the entirety of the Senate's spending, from committee work, to procurement, to the cost of losing senior staff with institutional knowledge, to purchasing services and signing contracts.

"Let's not put any redundant layers in place that aren't necessary," he said.

"But perhaps, there's a more efficient way to spend taxpayers money on the things the Senate is required to do by the Constitution. Let's look at that as well. Let's look at the full package of what the Senate does, and find ways for it to be more efficiently spent."

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