Transparency…it’s all in the eyes of the beholder

Transparency—it’s a wonderful concept.  But in order to be meaningful it must be applied across the board.

Sorry, I got ahead of myself.  I’m talking about Premier Redford’s decision to implement the “toughest and most transparent”* expenditure rules in all of Canada.  Her new policy will require politicians, their staff, and about 400 senior civil servants to post their travel and meal expenses on line.  In addition, the new policy will disallow any claims for booze or business class/first class airfares for domestic travel.

This is an excellent start that brings the government into alignment with expenditure policies that have existed in the private sector for at least a decade.  But has Ms Redford gone far enough?  (This is where you can lay bets that I’ll say no…and  you’d be right.)

Here’s my first concern.  The transparency of this policy is undermined by the fact that the policy can be waived by the Treasury Board.

Now the waiver of policies is not a new concept.  In the corporate world the board of directors can waive the application of a policy to its senior executives, however if it does so the company must disclose the waiver—its purpose and for whom—to the public in its annual documents.

As Brian Mason so eloquently puts it “You can go to a cabinet committee behind closed doors and cancel all or a part of this entire policy.  So they’ve left themselves a backdoor that’s huge and any expenditure problem that creates a problem politically…can simply be covered up”**And guess what, cabinet deliberations are shielded from FOIP requests…how convenient.

Here’s my primary concern:  all this talk about the expenditure policy is a drop in the transparency bucket.  Sure we’ll see a reduction in the misuse of public money—something I’d guess would be in the $10 million range***but what about transparency with respect to the looming $3 billion deficit? 

Mr Horner recently presented the 2012 Q1 budget results.   His presentation was pitifully bereft of details.  In essence the 9 page report says Alberta’s economy is strong notwithstanding global uncertainty, but since 30% of Alberta’s revenue comes from non-renewable resources, primarily oil and gas revenues which are highly volatile, it’s difficult to predict revenues.  The rest of the document is larded with high level charts and graphs culled from Stats Canada, Treasury and industry.

Compare this to last year’s Q1 update.  It provided a line-by-line detailed analysis of what was budgeted, what the actual amounts were and, most importantly, the reasons for the change (up or down) from the budgeted number. 

Here are some examples.  In Q1 2011, bitumen royalty revenues were $773 million higher than expected in the first quarter because of higher oil price revenues and lower operator costs, but investment income from the Heritage Fund was $51 million lower than expected due to higher exchange rates.

The same level of detail is provided on the expense side of the ledger.  For example, the department of Health spent $16 million less because the costs of its vaccination program and IT improvements were lower than projected.  However Sustainable Development spent $230 million more (fighting forest fires and the pine beetle infestation) and Municipal Affairs spent an extra $234 million assisting Slave Lake.  This is valuable information that helps us understand where our tax dollars are going.

This year’s Q1 report reads like a PR puff piece complete with a blandly reassuring statement about the ongoing health of Alberta’s economy.  The only explanation for the failure to meet budgeted targets is the volatility of oil and gas revenues.  Yes, we get that—a budget that is 30% based on volatile oil and gas revenues will be volatile, but that’s not all that drives the government off its budget numbers, remember last year’s experience with the $230 million extra required to fight forest fires and pine beetles and the $234 million for Slave Lake?

When Scott Hennig, head of the Canadian Taxpayers Federation (and a true champion for transparency) asked Mr Horner why the 2012 Q1 report was so skimpy, Mr Horner responded that he wanted to give reporters a more meaningful and understandable report.  What?  If the quarterly budget update has degenerated into a feel good brochure when can we expect the real thing?

Mr Hennig’s response was simple:  “I wouldn’t trust anyone who wouldn’t show me any numbers.”****

And that is the nub of the issue–transparency engenders trust.  It’s admirable that Ms Redford worked so hard to bring transparency to the government’s expense account policy.  But I wish she’d devote as much attention to her colleague Mr Horner to ensure that Albertans have as much visibility into the projected $3 billion deficit as they have into an MLA’s attempt to claim a $4 mini bar item on the public tab.

*Calgary Herald, Sept 6, 2012, p A1

**Calgary Herald, Sept 6, 2012, p A4

***This is a guess based on 26 ministry offices X $40,000/year, plus 400 civil servants X $12,000/year, plus boards and committees at $2million

****Calgary Herald Online, Aug 31, 2012.

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5 Responses to Transparency…it’s all in the eyes of the beholder

  1. Jane Walker says:

    Accountability and transparency in expense accounts …. Same old, same old …. we’ve heard this before.. YOU have identified the more important issue. Tactically, how can we work to get the premier to take your stand on our behalf?

    • Great question Jane…it appears to me that unflattering media coverage, meetings with MLAs to voice our concerns and impassioned letters to our MLAs and the newspapers have absolutely zero impact on the PCs who won’t change course unless they think they’re going to lose their majority. The next 4 years will be a long hard slog, but if we adopt the motto of a friend and “expose, oppose and propose” we’ll educate the public and hopefully slow down the grinding erosion of democracy at the same time.

  2. Carlos Beca says:

    I am with Jane Walker on this. I will wait and see. When there are exceptions in the law, we all know the results. Was it not just a few years ago that we had a law that did not allow for annual deficits? What happened to it?

    Alison Redford has taught us not to trust what she says anymore. So I will wait and see. It is definitely same old same old. To me anyone that does what these people are doing with our money including the premier with her unnecessary trips to Asia, does not have a great respect for the so called consumers – us. It is mind boglling really some of what these people have used in their expense accounts. This is not a Canadian problem, this is a political class problem all over the world. The examples are so many one does not know where to start but the most outrageous one is Russia’s Putin. He has now found some connection with the Czars as he now has 20 residences around Russia one of them being the Constantine Palace, a Czarist estate at the Gulf of Finland. He has 15 helicopters, 4 spacious yachts and 43 aircraft, one of them furnished with gold inlays. His personal fortune according with the New York Times worth tens of billions of dollars. The economist estimates 40 billion. This all on a president salary – 🙂
    Talk about revolution. The Czar was peanuts compared to this nut.

    Anyway I am off track as usual but it is great to talk about real issues. By the way Mr. Harper chosen as the 2012 Statesman of the Year. This just one more confirmation of the state of political life and commentary around the world. He was chosen by a rabi so maybe this is the payback for his blind support of everything jewish regardless. I guess it must be that Christian fundamentalist view of life. This choice is almost as good as Mr. Mugabe as the UN Ambassador for tourism. This criminal who destroyed one of the most beautiful and most productive countries in Africa and starved thousand of his own people to death and tortured a few thousand more is now a UN Ambassador. What are doing in the UN? It is as bad and Iran.

    • Carlos: the “political class problem” is a great way to characterize this situation, especially for a political party that’s been in power for decades. After a while the entitlement mentality becomes so ingrained that abuse of the public purse is seen as business as usual. I am concerned however that the media has been deflected from the big story (Mr Horner’s refusal to provide information on the budget deficit) in order to tell the juicier story (abusing one’s expense account).

      Mr Horner’s actions put the lie to Ms Redford’s promise of transparency. Thank goodness there are people like Scott Hennig to point this out in clear unequivocal language!

  3. Carlos Beca says:

    Susan you are absolutely right about the entitlement and the fact that the media, as I see it, avoids the big issues or just does not have the resilience to get on one issue and force explanations and if necessary push them against the wall and get them red faced as they should be. Adults talk so much about children being too long in front of monitors and losing their contact with the real world but from my experience it seems we are the ones that need the wake up call. We seem to be happy with all the reality shows and celebrity gossip and do nothing for our own mental and future well being. We leave that to the experts and gurus who have become in great numbers very good at taking full advantage of what they have access to.

    Scott Hennig may very well be a voice for some reason but the fact is that these people just do not care at all and they know that short of us walking on the legislature, nothing will change. Great that we have Scott but how many people really read his articles? How many of those really care about what is going on and how many will say ‘That is not new and has always happened…’ and just move on.

    Do you really believe that any of the current ministers is not going to fly first class when they have to go away on another junket? Do you really believe these people will stay in a regular hotel being the special people they think they are? The problem is that a lot of them think they are the new priests of the modern world, the only ones that understand the invisible hand of their godly created market.

    Short of changing politics and eliminate this current political mind set, it will be wisheful thinking to change anything.

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