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THE CHALLENGE
Canadians work hard for their money. When they send their tax dollars to Ottawa, they expect value for money. This means work that is fully accessible and fully auditable.
Under the Liberals, contracts have frequently gone to political insiders, and taxpayers do not get value for money because of the existence of “verbal reports,” contracts for which there is no paper trail for work performed.
The Liberals’ fondness for verbal reports has been criticized by the Auditor General. In Chapter 5 of the report that uncovered the Sponsorship Scandal, the Auditor General’s investigation of the government’s public opinion research reported “problems similar to those reported in Chapter 3 of this Report, on sponsorship.” In particular, she criticized the use of government polls for political purposes as well as the prevalence of “verbal reports.” In particular, the Auditor General singled out the Department of Finance, which under Paul Martin relied heavily on verbal reports with Martin’s friends at Earnscliffe.1 She reported that an audit uncovered verbal reports in five out of eight contracts between Paul Martin’s Department of Finance and Earnscliffe between 1999 and 2002.2
Problems with public opinion research have not been investigated by the Martin government as the chapter investigating polling was deliberately left out of the terms of reference for the Gomery Inquiry.3
THE FACTS
Despite years of Liberal promises to clean up government procurement, Liberal friends and insiders continue to have an edge in securing lucrative contracts. The Auditor General has raised concerns that many federal departments may be flouting the rules, and that breaking the rules extended beyond the Sponsorship program. Abuses include use of government polling for partisan purposes, as well as firms winning lucrative contracts but producing only verbal reports.
The Auditor General’s report on the Sponsorship program (Chapter 3 of her report released in February 2004) also looked at government-wide advertising and public opinion research. That audit (which was contained in Chapter 5) concluded, “In the selection of agencies and awarding of contracts, we observed problems similar to those reported in Chapter 3 of this Report, on sponsorship: with few exceptions, the same public servants broke the same rules in awarding contracts to the same companies. In breaking the rules, CCSB did not ensure best value for the Crown.”4
The Auditor General’s Chapter 5 audit of public opinion research highlighted several areas of concern including partisan questions in polls and unpublished polls with verbal only as opposed to written reports.5
In terms of partisan questions in government polling, the Auditor General noted, “In a small number of troubling cases, we noted that the government had failed to follow its own guidelines in effect at the time and had paid for syndicated research that monitored, among other things, voting behaviour and political party image.”6
The Auditor General also noted that “Communication Canada explained to us that it had been unable to release the results of a few research projects for the Department of Finance Canada because, according to the Department, it had received only verbal reports and had no written reports on these projects.” These “money for nothing” contracts were granted by then Finance Minister Paul Martin.
In April 2005, in the Public Accounts Committee’s hearing into sponsorship, advertising, and public opinion research, the Auditor General elaborated on her 2003 report.
“
Ms. Sheila Fraser: During the period covered by our audit, there were eight research projects in which Earnscliffe was involved. Only three of these projects were the subject of written reports. For the five others, there were verbal reports.”7
Who worked at Earnscliffe? Earnscliffe principals including David Herle and Elly Alboim were the campaign advisors to Paul Martin during his decade-long leadership campaign. Mr. Herle is currently the chair of the Liberals’ election campaign. As late as 2005, Mr. Herle, a principal of Earnscliffe during the time in question, remained steadfast in his belief that the oral reports were satisfactory.8
On March 31, 2005 Conservative MP Dean Allison placed an order paper question requesting any “grants, contributions or loan guarantees” as well as any “contracts” between the Government of Canada and Earnscliffe. In their response on September 26,9 the Martin government provided information on eight contracts between Earnscliffe and the Department of Finance during the period of the Auditor General’s 2003 audit (1999 through 2003). The details provided by the Martin government on these eight contracts are reproduced in the Appendix.
The value of smallest five (out of eight) contracts between Earnscliffe and the Department of Finance during the period of the Auditor General’s audit total $78,524. The value of the highest five contracts total $769,865.
Assuming the government did not provide incomplete or false information, we can safely conclude that when he was Finance Minister, Paul Martin gave between $78,524 and $769,865 in “money for nothing” contracts to his friends at Earnscliffe.
A later report by Auditor General found that under the Liberals, spending on polling has increased sharply. In 2005, the Auditor General notes, “Public opinion surveys and other forms of public opinion research contracted to the private sector by the federal government increased by 300 percent over a nine-year period to nearly 600 projects in 2003–04. The cost of contracted public opinion research projects in 2003–04, including both quantitative and qualitative research (for example, focus groups), was $25.4 million…”
The practice of verbal-only reports may be widespread. In October 2005, it was revealed that the Department of Indian and Northern Affairs hired an outside consultant, Ottawa-based Totem Hill Inc., and specified in the contract that “presentations shall be oral with supporting material provided to aid comprehension but not retained by the department.”10 The February 2005 contract meant that no documents would be retained by the department and therefore available either to the Auditor General or to a request under the Access to Information Act.
When the Auditor General’s Sponsorship audit was referred to Justice Gomery for his inquiry, Paul Martin specifically excluded the Auditor General’s chapter on public opinion research.
THE PLAN
The Conservatives will ensure value for money by banning verbal reports. In addition, we will further investigate the Auditor General’s disturbing revelations of public opinion research practices.
A Conservative government will:
- Ensure that all government public opinion research is automatically published within six months of the completion of the project, and prohibit verbal-only reports;
- Ensure that an independent review is conducted of government public opinion research practices discussed in Chapter 5 of the Auditor General’s November 2003 report to determine whether further action, such as a judicial inquiry, is required; and
- Open up the bidding process for government advertising and public opinion contracts to prevent insider firms from monopolizing government business.
THE CHOICE
On January 23rd, Canadians will choose between Liberal business-as-usual for the benefit of friends and insiders and a Conservative government who will clean up government and ensure it is fair and transparent for all regions of Canada.
Click
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1. Chapter 4, 2003 Report of the Auditor General of Canada, November, found
here
2. Testimony on April 18, 2005 before the Public Accounts Committee hearings on the Sponsorship Scandal, found
here
3. “Who is Responsible: Phase 1 Report,” Commission of Inquiry into the Sponsorship Program and Advertising Activities, November 1, 2005 found at
here
4. Chapter 4, 2003 Report of the Auditor General of Canada, November, found at
here
5. Chapter 5, 2003 Report of the Auditor General of Canada, November, found at
here
6. Chapter 5, 2003 Report of the Auditor General of Canada, November, found
here
7. Testimony on April 18, 2005 before the Public Accounts Committee hearings on the Sponsorship scandal, Found
here
8. Testimony on April 18, 2005 before the Public Accounts Committee, Mr. David Herle: “At the end of that, we would deliver a full oral report on that exercise.” Found at
here
9. Six of these
contracts were listed by both the Department of Finance and the Department of Public Works and Government Services.
10. “Feds Under fire for ‘no paper’ contract: ‘Verbal reports are completely unacceptable’ Conservative MP insists,” CP wire story, October 10, 2005 found at
here
