'It gives us all a black eye, maybe two black eyes and a &#39c;ouple; of broken teeth'

We'll subpoena NBCC witnesses, MLAs say


The legislative assembly's operations committee will, if necessary, use its legal powers to compel the attendance of witnesses and the production of documents in its probe of the Nunavut Business Credit Corp., committee chair Hunter Tootoo said this past Tuesday.

Tootoo issued the warning at the start of a committee hearing held in Iqaluit this week to deal with a devastating report on the NBCC by Sheila Fraser, the Auditor General of Canada.

Tootoo, who suggested that Nunavut government officials are already reluctant to supply the committee with relevant information, said the committee wants to hear from a long list of office-holders associated with the Crown corporation.

That list includes former senior employees of the corporation, a former chairperson, and a former deputy minister of Economic Development and Transportation.

"We will not hesitate to explore our legal options to compel their attendance, if necessary," Tootoo said.

If the operations committee does issue subpeonas to force the attendance of witnesses or the production of documents, it would be a first for Nunavut's legislature.

In defending this move, Tootoo complained that a key document – a list showing individuals and companies who received NBCC loans and the amounts and dates of those loans – was not given to his committee until two hours before the start of this week's hearing.

"Why are they waiting until the last minute to do things like that?" Tootoo said, saying it's impossible for committee members to read the document in time to prepare questions for witnesses.

In another unusual move, the committee was to have questioned David Simailak, the minister of economic development and finance, on the afternoon of Nov. 29 – after the Nunatsiaq News press-time this week.

Though it's normal for deputy ministers and other civil servants to attend committee hearings to provide information and answer questions, elected cabinet ministers are rarely invited.

In her remarks to the committee on Nov. 27, Sheila Fraser summarized her audit team's key findings, which revealed a "serious breakdown" of basic financial controls, the erasure of data from the NBCC's computers, violations of territorial law, and a lack of oversight by the corporation's board of directors.

She urged that the GN produce an action plan that would allow the corporation to produce accurate financial statements for the fiscal year ending March 31, 2008.

Rosemary Keenainak, the deputy minister of economic development, handed out a draft action plan for the NBCC that she said her department will complete in the future.

In her remarks, she deflected blame onto the NBCC's senior staff, suggested they did not follow letters of instruction given to them by her department.

Keenainak also said the full extent of the problems revealed by the auditor general was "new to me."

As for Fraser, she warned that her office expects to issue a second denial of opinion for the NBCC's next set of financial statements, which cover the fiscal year ending March 31, 2007.

Her first denial of opinion, for the year ending March 31, 2006, is stated in the scathing report that she released earlier this month.

"Denial of opinion" means the corporation's financial statements cannot be relied upon to reflect its true financial position.

Fraser said the only other denial of opinion ever issued by an Auditor General of Canada was given to the Canadian Broadcasting Corp. in 1985, when CBC's financial records were lost within a malfunctioning computer system.

"It gives us all a black eye, maybe two black eyes and a couple of broken teeth," Keith Peterson, the MLA for Cambridge Bay, said in reaction to Fraser's embarrassing findings.

Peterson, who disclosed that he sat on the board of the NBCC's predecessor, the NWT Business Credit Corporation, as well as the NBCC's first board until mid-2001, said he was shocked to see the detailed work that went into the creation of the new Nunavut lending agency go to waste.

"All the good work done in getting ready for Nunavut had been thrown out," Peterson said.

At the start of the hearing, Peterson disclosed another personal connection with the NBCC.

He said a company owned by his brother, Inukshuk Enterprises, has borrowed money from the NBCC. Peterson said, however, that he has no interest in his brother's company.

In another disclosure, Levi Barnabas, the MLA for Quttiktuq, reported that he has a 10 per cent interest in the Katujjijiit Development Corp., which also holds an NBCC loan.

Since some potential witnesses now live outside Nunavut, it's likely that the operations committee will sit again in January to continue its work on the NBCC.

This week's round of hearings was to have continued until at least Thursday afternoon.

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