Newspaper article The Canadian Press

N.B. Spent $13 Million to Find $10 Million in Savings, Auditor Says

Newspaper article The Canadian Press

N.B. Spent $13 Million to Find $10 Million in Savings, Auditor Says

Article excerpt

Consultant cost more than it saved: auditor


FREDERICTON - A consultant who was paid $13 million to find savings for the New Brunswick government only saved $10 million -- or less, the province's auditor general says.

Kim MacPherson said the consultant also billed $600,000 in travel expenses, but never had to produce any receipts.

"It's appalling," Green Leader David Coon said after MacPherson issued her report Tuesday.

The unidentified consultant -- the Liberal government said it was Ernst and Young -- was hired in 2013 by the previous Progressive Conservative government to help the Department of Social Services identify significant budget savings.

Only one consultant was considered and the department used an emergency exemption to avoid going to tender, she said.

"There appears to be a total disregard for the legislative framework, the policies, the regulations that are intended to ensure a fair and transparent procurement process," MacPherson said. "There were many steps and measures taken that would appear to try to avoid following good practice."

MacPherson said the contract continued after the Liberals assumed government in 2014.

"If this is a practice, it's very concerning. What is most concerning is that there appears to be a cultural problem here where there is an intent to disregard the procurement practices," MacPherson said.

She said the consultant's performance was self-evaluated and compensated on the basis of anticipated savings and not actual savings, with no set maximum price on the contract.

"That is completely unacceptable," she said.

Her report shows that as of June 2016, the department had paid the consultant almost $13 million to identify $47 million in anticipated savings, but actual savings were only about $10 million.

Of that $10 million, her staff was only able to confirm $8 million saved. …

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