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Auditor General Report on Sponsorship Scandal |
Findings of the Auditor General
This section summarizes the findings of the Auditor General's report on the
Sponsorship Program, as well as further findings on other government departments.
[Full Text of the Auditor General Report http://www.oag-bvg.gc.ca/domino/reports.nsf/html/03menu_e.html]
Findings on the Sponsorship Program
General findings of the Report on the Sponsorship Program include:
- From 1997 to 2001, the federal government ran the Sponsorship
Program in a way that showed little regard for Parliament, the Financial
Administration Act, contracting rules and regulations, transparency, and
value for money.
- Sponsorship funds were transferred to Crown corporations using unusual
methods that appear designed to provide significant commissions to communications
agencies, while hiding the source of funds and the true nature of the
transactions.
- The government paid over $100 million to communications agencies as
production fees and commissions. The communication agencies often provided
little or no services for these fees and commissions.
- Oversight mechanisms and essential controls at Public Works and Government
Services Canada failed to detect, prevent, or report violations.
- A new Sponsorship Program has been announced that, if properly
implemented, will improve transparency and accountability. The program will
be delivered using contribution agreements with event organizers directly
rather than contracts with communications agencies.
Details of the Auditor General's findings include the following :
- The government provided a $3 million dollar sponsorship of the 125 th anniversary
of the RCMP. This was wasteful because the RCMP was already required to display
the “Canada” word mark. Three communications agencies deducted $1.3 million
of the money before passing the remaining $1.7 million to the RCMP. These
agencies included Lafleur, Media/I.D.A. Vision, and Gosselin.
- The government provided a $5 million sponsorship for a television series
about Maurice Richard. Communication agencies received $440,000 in commissions
without signing any contracts or providing any services. These agencies included
Lafleur, Media/I.D.A. Vision, Gosselin and Groupaction. Via Rail was used
as a conduit to transfer nearly $1 million to the television series through
a fictitious contract. Lafleur received $112,500 to handle the transfer.
Canada Post paid $1.6 million to sponsor the series without any deal being
signed or any documentation whatsoever, breaking the corporation's own rules.
- Communications Canada provided $1.5 million to the Old Port of Montreal
to buy a new screen for its science centre. The money was passed through
the communication agencies of Lafleur and Media/I.D.A. Vision, which collected
$225,000 in commissions.
Full Text of Report on Sponsorship Program
Full Text of the Report on Government Advertising Activities
Other Finding of the Report
- Department of Indian Affairs – The Department did not
appropriately track its spending in land claims settlements worth $1.2 billion.
The Department also failed to follow guidelines in hiring outside managers.
- Government Aircraft – The government purchased two passenger
jets for transporting the prime minister, cabinet ministers and other VIPs.
The cost of the purchase was $101 million. The purchase was untendered
and unnecessary.
- Government Service Centres – The surplus of the Employment
Insurance system reached a record $43.8 billion. However, EI service centres
chronically under performed. 65 per cent of people calling EI centres for
assistance get busy signals.
- Parks Canada – The government
has been under funding Canada's parks and its heritage documents. Some historically
important documents are being lost to improper storage and to purchase by
private collectors.
Full Text of Report on Canada's Cultural Heritage
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