September 13, 2017
Reliance on consultants no way to govern: McCurdy
NDP Leader Earle McCurdy says if the Liberal government is serious about saving money, the millions of dollars it is paying to the consulting firm EY is a good place to start.
Government has spent millions on consultant reports that are not delivering what the people of Newfoundland and Labrador need to know.
Following a media investigation into embedded contractors in the Nalcor operation, the $2.2 million EY report on Muskrat Falls appears seriously flawed. Additionally, last week’s award of a $1.7 million contract to EY for financial and procurement advisory services raises questions of conflict of interest.
“The credibility of the content in the recent EY report on Muskrat Falls and Minister Coady’s comments that the report was ‘reassuring’ have to be called into question,” said McCurdy. “We’ve learned that hundreds of high priced contractors are embedded in the Nalcor operation costing tax payers millions of dollars and EY didn’t say a word about it in its report to government,” added McCurdy. “The EY report should have turned up Nalcor’s overspending on embedded contractors. When you pay $2.2 million for a report, it shouldn’t have that kind of major oversight.”
In a news release issued on September 8, government announced it had awarded a $1.7 million contract to EY for financial and procurement advisory services for the new acute care hospital project in Corner Brook. In 2016, government hired EY to do a so-called “value for money” assessment of public-private partnerships (P3s) for the delivery of both the hospital and the long-term care facility.
“What’s alarming is that EY, the very firm that did the value for money assessment, is now the firm that will be given a multi-million dollar contract to provide financial and procurement services,” McCurdy said. “It’s the big CA firms like EY that are among a handful of beneficiaries of public-private partnerships, and they are also the ones who recommend whether a project goes the P3 route, although the basis of that recommendation was hidden from public view. Nothing says conflict of interest quite like that.”
Since forming government, the Liberals promised to reduce spending on consultants and make better use of in-house expertise. To date, no analysis of consultant use has been made public. Since April 2015, government has committed over $4 million to EY alone.