Federal audit of Nunavut body bogged down in process

Andrew Nakashuk, acting chair of the Nunavut Planning Commission, said he is still waiting for a response from Aboriginal Affairs and Northern Development Canada on the terms and conditions of a federal audit and whether that audit will include an assessment of whether the NPC is adequately funded by AANDC. (FILE PHOTO)

A federal audit of the Nunavut Planning Commission, which Ottawa ordered in July and which was supposed to be completed this summer, appears to be stalled.

A series of letters this summer between the commission and Aboriginal Affairs and Northern Development Canada suggests process, scope and money are all to blame.

“We have no issues with them doing an external review,” the commission’s executive director Sharon Ehaloak told Nunatsiaq News. “The commission looks forward to making sure that they see the needs the commission has. We’ve been expressing that for a number of years.”

Ottawa ordered the audit after a decision by the NPC to deny Baffinland Iron Mines’ Phase 2 project, because it did not comply with the North Baffin Land Use Plan.

Hunter Tootoo, then the chair of the NPC, said the commission would likely not be able to handle any lengthy regulatory land use plan amendment process with Baffinland because of chronic underfunding.

So, in a letter to AANDC minister Bernard Valcourt, which was later made public, Nunavut Premier Peter Taptuna urged the minister to take the project out of the NPC’s hands and give it to the Nunavut Impact Review Board for an environmental assessment instead.

He also suggested to Valcourt that his department audit the NPC’s books to understand why the commission is so short of cash.

Valcourt did both. The NIRB is now in charge of the Mary River Iron Mine Phase 2 approval and Ottawa hired KPMG to conduct the commission audit.

But the audit never sat well with the commission and that comes through in explicit letters from Tootoo to Anne Scotton, chief audit and evaluation executive with AANDC.

In one letter, Tootoo described existing, and detailed, auditing which the NPC already undergoes and of which AANDC is well aware. He then asked about the scope of the audit in order for the NPC to revise its workplan and budget to accommodate the comprehensive three-year KPMG review.

Scotton replied to Tootoo that “there is no need for the commission to revise its workplan or budget as a consequence of this financial review,” since AANDC would be paying for it.

But Tootoo disagreed. To comply with the audit, staff would need to take time away from other work to supply KPMG with all the information they need, he wrote in a July 30 letter, and will “still require a significant investment of the commission’s staff and resources.”

In fact, Tootoo wrote, it’s Scotton’s own department that demands the NPC account for every deviation from the current workplan and budget so he’s only following orders from her bosses.

And on the subject of money, Tootoo asked if the AANDC audit would include how the commission won’t have enough money to hold final hearings into the Nunavut Land Use Plan next year.

And he wondered, when KPMG is looking at the numbers, whether auditors will have time to consider the commission’s added duties under the Nunavut Planning and Project Assessment Act (NUPPAA), a new federal law enacted in June 2013 which is supposed to help streamline development in Nunavut.

The commission estimated it would cost an extra $2.9 million to fulfill it’s duties under NUPPAA and that was back in 2009, Tootoo says. A senate report on the subject agreed that the new law should include extra money for regulatory bodies, he wrote.

“When the commission requested these additional funds, AANDC advised that the legislation was cost neutral which is a euphemism for no additional funding,” Tootoo wrote.

He suggests that if the auditors will be using public money to do this NPC financial review, that it would be “prudent” also to provide an independent assessment, “on whether the department has funded the commission as it promised to.”

No other correspondence from AANDC has been uploaded to the NPC’s website since that July 30 letter.

Acting NPC chair Andrew Nakashuk wrote a letter to Scotton in August saying they have received an email from a KPMG auditor but that the terms of the review seem to deviate from previous instructions. And he urged Scotton to reply to questions raised in Tootoo’s July 30 letter.