Biggest Scandal in Canadian History: Hrdc Audit Starts Probity War

2771 Words Jul 1st, 2011 12 Pages
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“Biggest Scandal in Canadian History”: HRDC Audit Starts Probity War

Abstract.
This article describes the nearly year-long political and media uproar that followed on the
Release in January, 2000 of a qualitative or soft “audit” of management control in the federal government department, Human Resources Development Canada, and analyses the contributing factors. The article argues that the auditors’ examination of project files for programs delivered by grants and contributions was so abstract and poorly executed that nothing whatever can be concluded from the work.

Introduction
The article takes up an audit event that dominated Canadian national politics for the first three quarters of the year 2000. The proximate cause
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Management had ignored two earlier audits that had allegedly worked the same ground.

HRDC soon released the first two internal audits of this sequence. The earliest dated from 1991, when Employment and Immigration Canada was in charge of such programs, and the second from 1994, about six months after the employment side of EIC was annexed to HRDC. The December 1994 study states that eight important recommendations arising from the 1991 audit had not been implemented in the period between studies. Significantly, it claims that the grants and contributions programs had no framework for program delivery such as “proper forms, procedures, training, and units of business.” Because of the absence of a framework, it is emphasized; staff concludes that control and monitoring are not important. This of course begs the question of where the auditors found the standards that they audited against.

On January 19 when the 2000 audit became public, Minister Stewart told the media that she had “a tiger by the tail.” The independent state audit bureau, the Office of the Auditor General (OAG), began by working with the Minister. Just eight days after taking hold of the administrative tiger’s tail, on January 27, the Minister felt it necessary to soothe an Alpha tiger: “Money is not missing,” she told the media, “Furthermore, the audit did not indicate any political interference, nor did it indicate that money was wasted.” For the media, the claim was not tenable. The

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