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April 9, 2014
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Provincial government drops financial review of U of A

Michelle Mark
News Editor
Oct 09, 2013

Advanced Education Minister Thomas Lukaszuk has quietly dropped his plans to audit the University of Alberta’s finances, The Gateway has learned.

Doug Goss, chair of the Board of Governors, told members of the U of A Senate in an in camera meeting Sept. 27 that the government’s financial review project will no longer go forward, said one member who spoke on condition of anonymity.

“The people who were supposed to come in — the consultants — didn’t actually show up,” the member said. The government’s reasons for cancelling the audit are unknown. But those present at the Senate meeting believe the project may not have been feasible due to the limited timeframe for the review given the vastness of the U of A’s financial information, which would have comprised tens of thousands of documents.

“It was very interesting to actually know that that won’t be happening,” the member said, “Just because it seems that the government is probably realizing that a lot of the things they want to do, it’s just not possible to do.”

Goss confirmed to the The Gateway that the financial review won’t take place, but refused to say why.

“You would have to talk to the government,” he said.

The Gateway asked Lukaszuk for comments on the status of the financial review, but a scheduled interview was later cancelled by his office.

“There is nothing to report yet, so we will need to do the interview at a later time,” Lukaszuk’s office said in an e-mail.

Goss first publicly announced the financial review through the university’s Colloquy blog on Aug. 20. Advanced Education hired independent consultants from Meyers Norris Penny to review the university’s financial plans and recording practices, and were to help create a plan to narrow the gap between the institution’s projected spending and revenues.

The Redford government abruptly cut the university’s operating grant by 7.2 per cent in March. The administration responded by submitting a plan to the ministry in July that would balance the budget by the end of the 2015–16 fiscal year. The university planned to carry deficits and cut spending over a three-year period.

Lukaszuk, however, rejected the three-year plan, leaving the U of A scrambling to cut $84 million in expenditures in two years.

The minister has said he introduced the financial review to help identify gaps in the university’s fiscal planning, adding that he was unhappy with the university’s projected deficits and overall budget planning.

“In their financial plan, the University of Alberta identified that they’re planning on carrying out deficits, which I found to be rather significant from a dollar value perspective,” Lukaszuk told The Gateway after Goss’ Aug. 20 announcement.

“Bear in mind the only deficit that you can technically justify by the budget cut is the $47 million that they lost (from the 7.2 per cent budget cut),” he said. “Anything above that has nothing to do with the budget cut.”

Lukaszuk initially informed the U of A of the audit through a letter to Goss received on Aug. 16, which also detailed the minister’s concerns with the three-year plan. In Goss’ Colloquy statement several days later, he said Lukaszuk’s letter would be shared with the public within days, but it still hasn’t been released nearly two months later.

The Senate member who spoke with The Gateway said although the audit’s cancellation may mark a change in conversation from the government, their unwillingness to announce it demonstrates arrogance.

“The fact that the auditors aren’t showing up, I feel like it is proof that they have realized they have made a mistake,” the member said. “But then again, if they are not going to go public with it, that means they are not willing to admit to that mistake.

“It seems like there is a lot of resentment within the University of Alberta administration, with the government telling them what to do and then being obviously unable to do it.”

NDP critic Rachel Notley, however, said it’s likely Lukaszuk used the financial review as a tool to intimidate the university into balancing their budget in two years, and dropped it once the U of A complied.

“It was a lot of smoke and mirrors,” she said. “If there was a good reason for doing it in the first place, he wouldn’t have cancelled it. Either he didn’t know what he was talking about when he talked about doing it, or he always knew what he was talking about and he knew it was a threat.

“It just further enhances or underlines the fact that there was never a genuine public policy reason for talking about the review, but rather that it was one of the many intimidation, bullying and threatening tactics that this minister is using,” she said.

The U of A Senate is comprised of 67 members including administrators, elected public members, and those appointed by councils and associations within the university. Although the Senate acts as a liaison between the university and its surrounding communities, it’s used mostly as a discussion forum for university-related issues and has no decision-making authority.

The member said the meeting had moved in camera to discuss the university’s budget-related concerns openly, and said Goss showed no signs of wanting to publicly announce the cancellation of the financial review.

“People should be aware that this is happening,” the member said. “It’s important to know that not everything is as it seems.”



Comments

Great job getting this info, Gateway! The whole concept of the financial review was ridiculous from the start and it’s good to see it won’t be going forward.



Posted by Alex on Oct 08, 2013

Superb reporting - hope the story gets the wide readership it deserves. Both the government and University Hall talk a good game when it comes to transparency but their record when it comes to delivering on the field makes the Eskimos look pretty darn good.
Mr. Goss’s failure to deliver on his August 20th statement about releasing the Minister’s August 16th letter was repeated by Acting Provost Ferguson-Pell when he told Chairs on August 28th that they would see the Minister’s letter. They haven’t.
A freedom of information request now has been made asking the University to release both the August 16th letter as well as the June 26th letter the Minister sent Mr. Goss about addressing the budget shortfall created by the government’s failure to honour its 2% increase promise.



Posted by Ian Urquhart on Oct 09, 2013

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