194 ABCs and Why They Matter

The other day on the campaign trail I met a Bearded Dragon.

He was curled up in the arms of a little girl, blinking sleepily in the afternoon sun. He practically purred when I stroked his chin. (Yes I know they don’t purr but I swear he smiled when I touched him).

Bearded Dragon (smiling)

It doesn’t take much to make a Bearded Dragon happy—a clean cage, fruit and vegetables and the occasional Madagascar hissing cockroach and he is good to go.

Not so with the human residents of Calgary Elbow. Like most Albertans they’re riled…and with good reason.

They’ve just learned that over the past 43 years the PC government created 194—repeat 194—agencies, boards and commissions (ABCs). These ABCs “manage” more than two-thirds of their tax dollars and are subject to less financial oversight than ministerial departments (and that’s not saying much).

The Big Four

The heavy hitters in the world of ABCs are Alberta Investment Management Corp (AIMCo), Alberta Treasury Branches (ATB), Alberta Capital Finance Authority and Agriculture Financial Services. Collectively they manage over $143.1 billion in assets.* Lord only knows how much money flows into and out of the remaining 190 ABCs.

Albertans have no idea who runs them, how their CEOs and boards of directors are selected, how their budgets are set and, most importantly, how well they perform.

Mr Prentice

Premier Prentice promised to put our minds at ease by appointing Hugh Bolton, Linda Hohol and Larry Pollock to conduct a “governance review”, starting with the big four.

This is a good plan but doesn’t go far enough.

The purpose of a “governance review” is to confirm that there are processes in place to assess a CEO’s performance and that the appropriate risk management and conflict-of-interest policies exist. It is an inward-looking exercise that doesn’t come close to living up to Mr Prentice’s commitment to “strong public agency board governance, accountability and transparency.”

Mr Prentice must expand his governance review into an accountability review—one that checks to see how well the ABCs are performing.

Alberta Health Services, the ABC with the biggest budget ($18.3 billion) is a case in point. Alberta spends more money per person ($6787) on healthcare than any other province, and yet our results are mediocre.

As an aside, Linda Hohol, one of the three people appointed by Mr Prentice to run the governance diagnostic on the ABCs, conducted a governance review of Alberta Health Services in 2013.**She made a number of excellent suggestions on how the governance of AHS could be improved.

Mr Horne

Fred Horne, the former Health Minister, shelved her report and fired the AHS board instead. Then he unilaterally appointed an outside consultant, Janet Davidson, to run the $18 billion enterprise by herself. Ms Davidson moved on to become Mr Horne’s deputy minister and was replaced by Dr John Cowell, former head of the Health Quality Council. Dr Cowell and Ms Davidson played musical chairs a year later when she replaced him after his one year term expired. (She kept her job as deputy minister). Fred Horne lost his cabinet post when Mr Prentice became premier and replaced him with Steve Mandel. Mr Mandel says he’ll reinstate the AHS board.

If this sounds like a governance gong show, that’s because it is.

Bottom line

Good governance is extremely important, but it’s not enough. The ABCs must deliver good results.

The public has the right to know which ABCs are performing well, which are mediocre and which are underperforming. Once we’ve identified the mediocre and underperforming ABCs (and Alberta Health Services is at the top of the list) we need to determine whether their performance can be improved…failing which they must be replaced with a better structure.

Albertans want more than the promise of good governance. They want to see concrete results; because unlike the Bearded Dragon, a tasty cockroach and a tickle under the chin just doesn’t cut it anymore.

*Alberta Government Press Release, Sept 24, 2014

**Health System Governance Review Task Force in a Governance Report submitted to Minister Horne in February 2013

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16 Responses to 194 ABCs and Why They Matter

  1. ABCanuck says:

    Thank you for pulling back the covers and elucidating the existence and pervasiveness of Alberta’s collectively powerful ABCs. Who knew there were so many? And who could possibly manage so many when even just managing four middling aircraft is seemingly beyond the ability of even senior cabinet ministers?

    There is great virtue in simplicity -I just don’t see how so many entities can be understood, let alone managed properly, or have their performance evaluated, or be held accountable, not just to ministers, but to taxpayers and voters.

    • ABCanuck: You asked how we can understand so many entities, let alone manage them properly. Apparently Mr Prentice’s solution is to create yet another agency (unfortunately I’ve forgotten its name) to oversee these entities. In my view that’s heading in exactly the wrong direction. The solution to having too many ABCs is not to create more. What we need is a governance plus results review (including a forensic analysis of how and where money is being spent) in order to decide whether we need them in the first place. As you said, there is great virtue in simplicity!

  2. Excellent expose! I am new to this, the richest province in Canada, and keep wondering where all that money is going. No Junior Kindergarten in schools, in fact not anywhere enough schools for our existing students (at the same time as enormous growth makes even more spaces in already overloaded school systems necessary, as the children of all those new workers flood in.) Also at the same time, our seniors are warehoused in already-scarce hospital beds, because there are not anywhere near enough beds in long-term care facilities — or even facilities! Local governments in smaller centres (I live in Canmore) seem to be well-supplied with buildings, but not with money to run necessary programs — oh, speaking of which, there’s a horrific backlog of children waiting for spaces in our daycare, too — wonder how their parents are faring in the work-world? I really love my new home (moved here on April 16 this year) but I really sometimes want to rip my hair out by the roots at the folly I see.

    • Caroline, good question: where did all the money go? I attended the press conference where Mr Prentice recently announced his $2 billion plan to build 55 new schools and modernize 20 more. A savvy reporter asked whether the $2 billion was in the capital budget. Mr Bhullar, minister responsible for infrastructure, said he wasn’t sure. When asked how the government was going to pay for these schools (let alone the teachers and support staff that the schools will require) Mr Bhullar said the government was going to be “creative” and “innovative”. In other words, they have no idea.
      We need to hold the government’s feet to the fire. No more pie-in-the-sky announcements unless they’re accompanied with a concrete execution plan so we can all see where the money is coming from and where it’s going.

  3. Carl Hunt says:

    Good exposure of corporate capitalist Alberta but you forgot to mention the Alberta Energy Regulator (AER) that controls the fossil fuel industry and considers the environmental impacts, before issuing permits – or does it! We know who runs the AER and it’s not the Alberta government and “Our Fair Share” showed who was getting most of the benefits. The public blinked, then a govt decision was made in private with the energy companies, and the public went back to sleep.

    • Carl, excellent point. The AER is one of the 194 ABCs. When the government rolled the Dept of Environment, the Dept of Sustainable Development and the Dept of Energy under the Responsible Energy Development Act to be regulated by the AER and then appointed Mr Protti (formerly of CAPP) and Mr Ellis (formerly DM of Environment who was at the helm when some intervenors were unjustly denied status to participate), undermined the confidence of Albertans tremendously. Add to that the recent Auditor General’s comments that the Oilsands Environmental Monitoring Report was incomplete, inaccurate and misleading and it’s no wonder that the public does not believe the government’s claim that we have a “world class” environmental regulatory system. Incidentally the Oilsands Environmental Monitoring program is now being run by the Alberta Environmental Monitoring, Evaluation and Reporting Agency (AEMERA), another ABC. Not very reassuring is it?

  4. Jim Lees says:

    Another great post Susan, on a topic of particular interest to me. It is right to question how and why these exist, and especially how appointments are made to these. From my limited exposure, this is a dark art, with strong political overtones and little transparency. I won’t go into it now, but would enjoy a chat with you on this. Hope the campaign is building steam, take care. Jim

    Sent from my iPad

    >

    • Jim, “dark art” is a great way to describe this process. Many of us catch a whiff of patronage and cronyism as well. Yes, let’s chat about this further.
      PS campaign is going well. I’ve got a great team and we’re blessed with a progressive riding. 🙂

  5. Sam Gunsch says:

    FWIW…

    Democratic Audit UK has done useful work in monitoring and critiquing ABC’s which are collectively termed as quangos in UK.

    http://www.democraticaudit.com/?page_id=234
    http://democraticaudituk.wordpress.com/our-work/quangos/

    This last link has a useful set of questions for critique.

    http://democraticaudituk.wordpress.com/our-work/quangos/quangos-and-quangocrats/

    Sam Gunsch

    • Sam, thanks for these links. Your comment reminded me of an episode of “Yes Minister”, the British satire about a hapless minister attempting to do some good but getting caught in the political games of his permanent secretary. One episode deals with quangos and the machinations the department goes through to land a failed politician a good post on an ABC. The politician wants to be a director with something like the World Bank but the best they can do is put him on the Fish Board or some such thing. I wonder whether Mr Prentice’s governance review will lead us down a similar path. Wouldn’t it be great if Mr Prentice just published the names of all 194 ABCs so we could get an inkling of what’s out there?

  6. Carlos Beca says:

    43 years of illusion that is what all of this is about. I will just remind people this week of one of the most intelligent quotes ever created:

    We can’t solve problems by using the same kind of thinking we used when we created them

    This is exactly what we have been doing for at least the last 15 years and we have not learned anything at all. The waste in ABCs and BCAs and CCCs and whatever other acronyms we invent is deplorable and lack of character and respect for the democratic process and government institutions from our political class is atrocious and it is clear to me that soon there will only be civil disobidience to fix this mess. I would suggest Governance 101 to Jim Prentice and gang. The Legislature is not a place to gain influence and serve those that provide you with election dollars. It is much less a place to become a dictator. The legislature was created to be the center of discussion of different voices and ideas so that we can together build the best place for all of Albertans and where we can develop our standards of living and our creativity and quality of life.
    This is the ABC they should all be learning and as fast as possible.

    • Carlos, you’re bang on! The purpose of public service is to serve the public. But 43 years of running the show has eroded that concept. Now we’re facing a government whose sole focus is to stay in power. The $2 billion new schools announcement this week is meant to bolster the unelected Education Minister in the Calgary Elbow by-election. The premier is making a companion announcement next week to bolster his unelected Health Minister who is running in Edmonton-Whitemud. It doesn’t get any more obvious than that.
      I sense the people are starting to see through this and won’t put up with it much longer. The next two years are going to be very very interesting!

      • Carlos Beca says:

        I certainly hope you are correct with your last sentence.
        I read above that the campaign is going well and that is just what I like to hear. Are you running for the Liberal nomination or are you actually running on one of the by-elections?
        I have a question for you this week if you do not mind. In face of what we have heard about Alison Reford’s misuse (nice word) of the public treasury, is it possible for a citizen like myself to take her to court? I would appreciate your answer. If it is possible, do you know of anyone who is thinking about the same idea?

        I would be in heaven if the PCs lost all of the by-elections and Jim Prentice had to resign. Not as impossible as people think. The more promises they make the worse it gets.

        Thank you appreciate it.

      • Carlos, I’m running in the Calgary Elbow by-election for the Liberals against Gord Dirks, the unelected Education Minister. I’m finding a high level of dissatisfaction with the PCs. People aren’t prepared to just check the PC box on the ballot anymore. That’s why I”m optimistic about our ability to make a meaningful change in this riding (me).
        With respect to your second question. While I’m not an expert on this I don’t think a citizen can sue an MLA under these circumstances. A citizen’s recourse is to throw the government or that particular MLA out of office. A citizen can also bring pressure to bear on the opposition parties to force a public inquiry on the misuse of government funds. The inquiry route takes time and money. Frankly I think the best thing to do is boot them all out of office. You guys in Edmonton have a great opportunity block Stephen Mandel. Volunteer for the candidate best able to turf him out. Donate money to their campaign. Show your support with lawn signs. That will send a message that the PCs days are done and they are NOT going to be replaced by the WR.
        We’re doing the same down here in Calgary. These by-elections are critical to Jim Prentice. Let’s block him on all four because you’re right, it’s not as impossible as people think!

  7. Carlos Beca says:

    Thank you for the information. I appreciate it very much. The more I know about the system the more I realize the sad state of our democratic process. It is virtually impossible to get these crooks out of their dens.
    I got all the info on the by-elections and I am embarassed that I did not know you were actually in it. It is right there.
    Here I think Stephen Mandel will have a bit of a hard time, especially considering he is the minister of health and is running against an experienced doctor – Bob Turner and a very experienced nurse – Donna Wilson. Fun fun fun.
    I will have fireworks in Edmonton if you win. As promised I will be at the Legislature to congratulate you. If you win do not forget to leave my name with the body guards 🙂
    Good Luck Susan. These must be some of the most important by-elections held in Alberta in many years.

    I apologize for my silly question.

    Carlos Beca

    • Carlos, no need to apologize, everything is moving very fast in these by-elections and it’s hard to keep up with Mr Prentice showering us with “feel good” announcements every chance he gets. I agree with your take on Stephen Mandel–he has absolutely no experience in healthcare and he’s up against two very solid healthcare professionals.
      And yes, when the big day comes I’ll take you to lunch, on my personal tab, not the public purse!

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