P.E.I. Finance Minister Wes Sheridan is denying there was any effort to mislead Islanders about the state of the province's finances using money from Ottawa for the transition to the harmonized sales tax.
On Monday, the province's Blue Book, the final audited statement of the government, showed $25 million from the federal government in compensation for adopting the harmonized sales tax had been moved from 2012-13 to 2013-14.
Opposition leader Steven Myers called a news conference Thursday, and accused Sheridan of deliberating misrepresenting the provincial deficit.
"The treasurer has taken this $25 million and used it to mislead Islanders," said Myers.
"It raises serious concerns about how fit the treasurer is to run the finances of this province."
The accounting move changes a previously reported deficit for 2012-13 of $53 million to $78 million. Myers said Sheridan was moving around the money to make it appear as if that $25 million was revenue in two different years, saying the transition payment had a "double life."
"I think that Wes Sheridan is lying to Islanders," said Myers.
"I think he's been doing it for a long time, and this $25 million that he's trying to spend twice, he's trying to use it to make Islanders think he's doing a better job than he is."
Auditor general ordered the change, says Sheridan
The province received a total of $39 million in HST compensation from Ottawa, and Sheridan told CBC News Thursday it was always his plan to account for that money over two years.
"The deal was struck and signed with the federal government, with [Finance Minister Jim] Flaherty's signature on it, saying that we were going to take $25 million in the 2012-13 year, and we're going to take $14 million in the 2013-14 year," said Sheridan.
"There is no cloudy period to this whatsoever. That was the full plan. That's what I put out from the very first day."
But that plan changed as Auditor General Jane MacAdam audited the figures that would eventually be published in the Blue Book. Sheridan said MacAdam told him all of the compensation money should be accounted for in the year HST was enacted, that is, 2013-14.
"There's no question why we did it. We were asked to by the auditor general. We changed our books to reflect that," he said.
"Would I sacrifice one year for another? There is not a chance in the world. Why would I do that? We're asked to follow the accounting principles ... I have to have the auditor general sign off on our books."
Myers has written to the auditor general, asking for her specific order regarding the HST compensation, and for an explanation of why she wanted the change.