-- CTF urges Martin to "Play by the Rules" with the Millennium Fund --
OTTAWA: The Canadian Taxpayers Federation (CTF) today released a copy of a letter it has forwarded to Finance Minister Paul Martin concerning the "furore" over the Government's handling of the Millennium Fund.
In the letter to Mr. Martin, CTF Federal Director Walter Robinson points out to the Finance Minister that the Government's actions highlight "a perceived disrespect for the Auditor General and his employer, Canadian taxpayers." Robinson goes on to note that 'booking' the Millennium Fund in the current fiscal year is "wrong" and that "public sector accounting principles laid out by the Canadian Institute of Chartered Accountants and interpreted by the Auditor General - support our contention."
"If Canadian taxpayers claimed RESP deductions on their 1997 tax return but didn't actually invest the money until the turn of the century, Revenue Canada would audit, try, convict and jail them in a heartbeat," said Robinson. "But it seems that the Government plays by rules only when it suits them, and if political expediency is the issue, then the accounting rule book is conveniently discarded. This is a serious and dangerous situation."
The Auditor General has repeatedly raised this issue with the Government and is now trying to plead his case in the court of public opinion. Robinson noted that "the Government must place a higher value on the advice and direction of the Auditor General."
"The office of the Auditor General costs Canadian taxpayers $50 million per year yet most of its reports gather dust on Cabinet shelves. This is shameful waste of good and costly advice," added Robinson. "The Minister must immediately take all necessary legislative steps to address this issue. The $2.5 billion now booked in the 1997/98 budget belongs to taxpayers. It should be given back to them in the form of tax relief and debt reduction."
Text of the CTF Letter to Paul Martin
Dear Minister Martin:
I am writing to you today to express the Federation's (CTF) fundamental and immediate concern with several issues that surround the Millennium Scholarship Fund announced in last month's budget.
Specifically, there a three issues that we wish to bring to your attention:
- A disregard for Public Sector Accounting Principles;
- A perceived "disrespect" for the Auditor General and his employer, Canadian taxpayers; and
- The credibility of the Office of the Minister of Finance with respect to this issue.
To begin, we believe it was wrong "to book" the Millennium Scholarship Fund as an expenditure for fiscal year 1997/98. Public sector accounting principles laid out by the Canadian Institute of Chartered Accountants and interpreted by the Auditor General of Canada support our contention. To maintain integrity in the government's accounts it is imperative that public funds that are committed in a given fiscal year are expended in that same fiscal year. "To book" the $2.5 billion dollar fund during the current fiscal year has effectively denied Canadian taxpayers $2.5 billion in tax relief and debt reduction.
Second, the Government of Canada must place a higher value on the advice and direction of the Auditor General of Canada. This is the second time in as many years that the Auditor General has warned the Government about the practice of "booking future expenditures." You will recall that a similar concern was raised by Mr. Desautels last year with respect to the $800 million Canadian Foundation for Innovation. The Government has once again ignored the advice of the Auditor General given its current "booking" of the Millennium Fund.
Even more troubling are the actions of your Deputy Minister and the Treasury Board Secretary in their March 12 "public" rebuke of the Auditor General's actions. We fully support Mr. Desautels and the manner in which he has brought the Millennium Fund issue into the public domain. The Government's repeated dismissal of a fundamental public sector accounting principle as identified above has precipitated the actions of the Auditor General. Indeed, Mr. Desautels was duty bound to present his concerns to the Canadian Public.
The Auditor General of Canada is the most impartial fiscal watchdog in the country. By consistently refusing to heed his advice, the Government, in our view, is treating Canadian taxpayers with a great deal of disrespect. Moreover, a dangerous practice is developing as the Government ignores public sector accounting principles in order to distort the true state of the nation's finances.
Mr. Minister, your stewardship of the nation's finances over the past five years has earned you a great deal of admiration from Canadians, the grudging respect of your political adversaries, and bolstered "a confidence in Canada" among the international financial community. However, the failure of the Office of the Minister of Finance to fulfill its responsibility to maintain the public's confidence in the management of the nation's finances risks the quick erosion of this base of respect.
On behalf of tens of thousands of CTF supporters, I urge you to immediately take all necessary legislative steps to address this serious issue. The Millennium Scholarship Fund must be removed from the nation's books for fiscal year 97/98 and the $2.5 billion must then be returned to its rightful owners in the form of tax relief and/or debt reduction.
Sincerely,
Walter Robinson, Federal Director