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OTTAWA - (Web posted May 8, 2002 @ 3:29
p.m.) - Canada's Auditor General Sheila Fraser blasted Ottawa for its handling
of three government advertising contracts worth $1.6 million on Wednesday, and
she has asked the RCMP to investigate the matter.
 "Senior
public servants broke just about every rule in the book," Fraser said in
her report which was tabled in the House of Commons Wednesday afternoon. "I
have referred this matter to the RCMP and I am undertaking a government-wide
value-for-money audit of advertising and sponsorship programs of the Government
of Canada."
The report was requested by Public Works
Minister Don Boudria in March after news surfaced that the government had paid
more than $1 million for work that was not received from the Montreal-based
advertising firm Groupaction.
In a prepared statement, however, the
company defended its work.
"Groupaction has provided adequate
services that correspond to the communication and political objectives of the
Government of Canada," the company said in a prepared statement.
The contracts were part of an effort by
Ottawa to increase its visibility after the 1995 Quebec referendum.
In the House of Commons on Monday, Prime
Minister Jean Chretien linked Ottawa's multi-million visibility program to a
decline in the independence movement in Quebec.
"In 1995 Canada was drifting. We went
to Quebec and told Quebecers all about Canada," the prime minister said. "Look
at the result today. Even the big agencies have said that the government has
acted properly and now the danger of separation is much less than it was in 1995."
But Fraser said the basis for establishing
the contracts remains unclear and that she could not provide any assurance to
the public that the federal government received value for money from any of the
contracts.
"I am very troubled by the lack of
documentation which is pervasive throughout the three contracts," she said
during her Ottawa press conference.
In her report on the contracts, which were
awarded to Groupaction between 1996 and 1999, the Auditor General identified the
following deficiencies:
- The government did not receive everything it
contracted for. Key elements specified in contracts were never delivered and no
one has been able to locate a report for the second contract for which the
government paid $549,990.
- Officials approved payments for work that
varied from or failed to satisfy contract specifications.
- Officials told us payments were made for
advice, even when advice was not stipulated in any of the three contracts, and
was not documented as having been received.
- What Groupaction delivered under the third
contract has similarities to what it provided under the second because the
government had asked for similar work in both.
"This is a completely unacceptable way
for government to do business. Canadian taxpayers deserve better," said Ms.
Fraser.
 Immediately
after Fraser's press conference, Boudria announced several new measures to
promote transparency and openness in Ottawa's contracting policy.
Boudria replaced former Public Works
Minister Alfonso Gagliano, who was in charge of the department when the contacts
were awarded, in January.
But he also defended Gagliano who has borne
much of the criticism for awarding the contracts while he was minister.
"It's possible that a minister did not
know about every contract, let alone three of them," said Boudria, who
noted the three contracts constitute a small per cent of the thousands that are
awarded each year by the government.
Afterwards, Canadian Alliance leader John
Reynolds repeated his call for a public inquiry into the matter, rather than a
RCMP investigation, in order to provide complete accountability to Canadians.
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