Debt still mount­ing from con­stituency spend­ing scan­dal

Northern Pen - - EDITORIAL - Rus­sell Wanger­sky Eastern Pas­sages

The ac­coun­tants never for­get. I mean, most of the prov­ince has prob­a­bly moved on. Many couldn’t even tell you just what year it was when mem­bers of the House of Assem­bly were caught with their hand in the cookie jar, in the free-forall known as the con­stituency al­lowance spend­ing scan­dal. Some might not even re­mem­ber that it hap­pened at all.

I can tell you when it was: from early 1989 to early 2006, MHAS — at least as far as their ex­penses were con­cerned — lived the un­ex­am­ined life. They sub­mit­ted ex­pense claims that were re­viewed and paid by fel­low MHAS with no over­sight what­so­ever, buy­ing liquor, art, clothes, and do­ing other dodgy things like sub­mit­ting ex­pense claims for travel that was never taken.

The ar­gu­ment for the lack of scru­tiny? That it would be a breach of the “honourable” mem­bers’ priv­i­lege to have lowly bu­reau­crats au­dit­ing the spend­ing of their bet­ters.

Some MHAS were con­victed and went to jail — scores were made to pay back ex­penses they should never have been able to claim in the first place.

Some of­fered up re­pay­ments as soon as they were told about the prob­lems with their claims. And some, well, some didn’t. The prov­ince’s Pub­lic Ac­counts are a long and of­ten bor­ing set of doc­u­ments. It reg­u­larly runs to four vol­umes, hun­dreds of pages of the fis­cal pic­ture of the prov­ince, al­most al­ways avail­able close to seven months af­ter the end of the fis­cal year.

This year’s pile came out re­cently, and if your eyes don’t glaze over, there’s al­ways an in­ter­est­ing en­try or two.

And that’s what the con­stituency al­lowance scan­dal is re­duced to now — a sin­gle en­try of ac­count­ing text.

You could call it a “faint hope” post­ing — it’s on page 110, in Sched­ule A, a place where the prov­ince lists “Ac­counts and Taxes Re­ceiv­able.”

Money, in other words, that the gov­ern­ment ex­pects to be able to re­cover. It’s un­der the head­ing of “Amounts due as a re­sult of Con­stituency Al­lowance re­view,” and it’s some­thing I hadn’t seen be­fore.

Some money has found its way back to the trea­sury.

Three for­mer MHAS ap­par­ently made pay­ments dur­ing fis­cal 2016-17 on con­stituency al­lowances they’d im­prop­erly re­ceived: one paid $24,548, another man­aged $11,103, and the third paid a mighty $250.

The im­pact of those pay­ments?

Well, MHA No. 1 owed $151,882, and was charged in­ter­est at around two per cent, adding $3,154 to the to­tal. That MHA’S pay­ment of $24,548 brought the in­debt­ed­ness down to $130,489.

MHA No. 2 owes $90,644, and had in­ter­est of $1,857 added to the to­tal — post the $11,103 pay­ment, and the to­tal owed shrank to $81,399.

MHA No. 3, who paid all of $250 dur­ing that fis­cal year, saw ev­ery sin­gle bit of that pay­ment eaten up by $7,589 in in­ter­est charges on the $336,684 be­ing car­ried at the start of the year, and at the end of the year owed $344,023.

Those, how­ever, might be con­sid­ered the good guys. Af­ter all, at least some pay­ments were made on their long-delin­quent ac­counts.

Be­cause there’s an aw­ful lot of money that hasn’t found its way back.

Ac­cord­ing to num­bers from the pro­vin­cial Fi­nance De­part­ment, there’s an ad­di­tional $2,144,589 in out­stand­ing con­stituency al­lowance money that the of­fend­ing “honourable” MHAS have paid noth­ing on.

And what kind of mes­sage is that, ex­actly?

The grand to­tal of money out­stand­ing for more than a decade now is $2.7 mil­lion — money im­prop­erly spent by MHAS and re­im­bursed by tax­pay­ers, many of whom were in far less priv­i­leged po­si­tions than those who still haven’t paid back their ill­got­ten gains.

Hope­fully, the in­ter­est will con­tinue to ac­crue, and the pro­vin­cial gov­ern­ment will at­tach as­sets and re­cover the cash, just like they would if you or I failed to pay our in­come taxes.

Hope­fully, year by year, the money will keep com­ing back un­til ev­ery last cent is paid.

But think about this: at the rate it’s com­ing back now, the money be­ing re­cov­ered isn’t even cover­ing the in­ter­est costs of the funds still out­stand­ing. In other words, at this rate, the debt can only grow.

The ac­coun­tants don’t for­get. We shouldn’t ei­ther.

And if any­one should pay their debts to the prov­ince, it’s those who set and en­force the rules on all the rest of us.

Rus­sell Wanger­sky Rus­sell Wanger­sky’s col­umn ap­pears in 35 Saltwire news­pa­pers and web­sites in At­lantic Canada. He can be reached at rwanger@thetele­ — Twit­ter: @wanger­sky.

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