On the Auditor General, McNeil is half right

The ironic thing about the fuss over the Premier’s snarky attack on the provincial auditor general is that he has the right target but the wrong issue.

Asked by reporters last Thursday to comment on the auditor’s deconstructing of the government’s efforts to deal with the family doctor shortage, McNeil aimed a couple of jabs in AG Michael Pickup’s direction. The gist was first, that he (McNeil) didn’t need to be told Nova Scotia has a shortage of family doctors, and second that the voters, not Pickup, would judge the quality of the government’s communication on the shortage.

Prodded for his opinion on whether the auditor had overstepped his authority, McNeil made a general observation on the respective roles of elected representatives and the auditor. He argued that public policy is the “right” of elected members, whose decisions in that regard are judged by the public at election time. Then he delivered what he may have expected to be the knockout blow.

“If he (Pickup) chooses and wants to do public policy there are 51 ridings for him to run in…He has a job to do to ensure that the finances are being spent appropriately, but public policy is actually for the people who are elected.”

To continue the boxing metaphor, the media judged that the Premier’s roundhouse punch badly missed the mark. It was McNeil, not the AG, who ended up on the canvas.

Reporters looked to the law and concluded that the auditor’s report on certain aspects of health care delivery (physician, mental health and home care services) was well within his legal mandate. That’s an interpretation with which the AG heartily agreed. “I’m 150 per cent comfortable that the work we’re doing lies within the mandate of the office of the auditor general,” said Pickup.

Far be it from me to challenge 150 per cent certainty. And the audit at issue of the work of the Department of Health and Wellness and the Nova Scotia Health Authority certainly seems to fall within the terms of Section 18 (1) of the Auditor General Act. That section says the AG may conduct “any audit or investigation that the auditor general considers appropriate” with respect to “any auditable entity.” An auditable entity would include any government department or agency such as the health authority.

Fiscal policy

Who knows what McNeil was thinking when he went after Pickup? Perhaps he was just annoyed with the headlines generated by the health audit – for example, “AG slams Nova Scotia health care” (Chronicle-Herald) and “Report calls out gaps in N.S. health care” (Globe and Mail). Those headlines help to validate what the opposition parties and vocal members of the public have been saying for months.

Maybe the Premier was thinking that the timing of the audit report and the way it was delivered and covered was close to crossing the line set out in Section 18 (7) of the legislation, to wit “Nothing in this Act is to be interpreted as entitling the Auditor General to question the merits of policy objectives of the Government.”

I’m no lawyer, but as tough as the audit report was, it did not question “the merits of the policy objectives of the government” – just its failure to achieve them. Whether the same can be said about the eagerness of both Pickup and his AG predecessor to implicitly question the fiscal policy objectives of successive governments is another matter. If there has been any crossing of the line into public policy it has taken place there.

Pickup and the AG before him, Jacques LaPointe, have used their office to purvey doom and gloom about Nova Scotia’s fiscal state, using selective statistics and dubious analysis to make their case. It started with LaPointe, when the NDP was in power, questioning the inter-generational ethics of public debt. It has continued with Pickup.

I wrote about Pickup’s tendency to leave out facts that would spoil his story in posts in February 2015 and again in November of 2015. As a backbench MLA in 2012 Howard Epstein challenged LaPointe’s initial foray into this territory at a meeting of the legislature’s public accounts committee in January 2012. Further details of that encounter can be found in Epstein’s book, “Rise Again: Nova Scotia’s NDP on the Rocks.”

One thing to note is that there is nothing in the Auditor General Act that mandates an overview of the province’s fiscal position. LaPointe and Pickup have taken it upon themselves to venture into territory normally occupied by the Canadian Taxpayers Federation. The other thing is that other than Howard Epstein, no politician has complained about AG’s continuously raising the small “p” political issue of public debt. Indeed, when Epstein brought it up in 2012 the top Liberal at public accounts apologized to the AG for his “diatribe” and the Conservatives called for Epstein to be kicked off the committee.

It was obviously to the political advantage of the Liberals and Conservatives to do so. When the dustup involving Epstein and LaPointe occurred, the debt of the province stood at $13.4 billion. Liberal and Conservative governments ran up over 97 per cent of that debt over the years, $9 billion of it accumulating since 1990. Being able to cast the NDP as defenders of public debt worked like a charm in letting the Liberals and Tories off the hook for past performance. Similarly, Pickup’s dire warnings of 2015 fitted well with the McNeil government’s restraint agenda.

Doom and gloom forever

But now that the budget has been balanced and some modest new spending is planned, the McNeil government may want to pat itself on the back and austerity weary Nova Scotians can point to a recent report from the Parliamentary Budget Office in Ottawa. It revealed that Nova Scotia is one of only two fiscally sustainable provinces in the country. (PBO defines fiscal sustainability as maintaining current debt-to-GDP levels without the need to raise taxes or cut spending. The calculations are done annually, and may be different next year).

Despite that positive news from the PBO, the AG is still peddling doom. Pickup’s latest fiscal overview report presented in October downplayed the Liberals’ modest surplus and played up the bad news over the last 10 years – expenses up 37%, taxes up 49% and net debt increased by $3 billion. His report is accompanied by videos (available on Utube) posing 30 questions Nova Scotia “may want to ask” (of whom is not clear).

The ten questions on fiscal matters are either politically loaded or unanswerable. There are no non-political answers to questions such as:

  • Nova Scotia paid $7.5 billion in interest in the last 10 years. What happens if interest rates rise by 2-3% and how will this be paid?

Or

  • Total health care costs increased 46% in the past 10 years. If the number of Nova Scotians over 65 years doubles in the next 15 years, what is going to happen to health care costs?

Or

  • What are the biggest risks to Nova Scotia’s financial conditions and how prepared is Nova Scotia to react to the next recession or unexpected events?

And then there are the ones that seem designed to stir up the political pot, such as:

  • Education costs have increased by $109 million from 10 years ago. With fewer students than a decade ago, how did education costs increase by 7%?

Or

  • Total net debt increased by $1.6 billion in the past five years…What does this extra debt get us?”

Then there is

  • Why does the amount of debt we all owe keep increasing?

Question number eight (Is there a plan to repay the debt, and how many years will it take) is in my view the most eccentric. There has been a public debt as long as there has been a political entity called Nova Scotia. Does the AG of this province seriously believe we can have a plan not just to reduce it – but to repay it?

So run, already

Perhaps he is just being provocative with this question and one he posed in his chapter on pensions. That one’s a doozy, politically. It asks why the province contributes different amounts to different pension plans – one dollar for each dollar contributed by teachers and civil servants and five bucks for every dollar contributed by MLAs. That’s a good one to be chewed over at the local coffee shop by the “all politicians are in it for the money” crowd.

No doubt about it. Michael Pickup has raised a lot of interesting questions, most of them political. Maybe it’s time he gave up his $187,000 per annum 10-year gig as AG to run for office. The Conservatives are currently looking for a Leader so he may even be able to get in close to the top.

 

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About Richard Starr

RICHARD STARR has had careers as a journalist, public servant, broadcaster, political staffer and freelance policy adviser. He is author of numerous newspaper and magazine articles, appearing in everything from Atlantic Insight to Atlantic Progress. A lifelong student of Maritime history, Starr is married to playwright and former MP Wendy Lill. They live in Dartmouth.
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