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September 27, 2011

Municipal Auditor General

The promise to give BC a Municipal Auditor General sprung out of Christy Clark’s leadership campaign. Like much of what she says, it may be appealing but not the product of deep thinking and solid research. The full promise also said:

“Fund the office as part of the Auditor General’s office. The office will provide advice on financial decisions and provide a measure of accountability. Review the municipal taxation formula. Work with the Union of B.C. Municipalities to ensure municipalities are properly funded and communities can provide the services British Columbians want from local government.”

Municipal politicians must wonder what’s coming next.

On the eve of the Union of B.C. Municipalities (UBCM) annual convention, Minister of Community, Sport and Cultural Development Ida Chong issued an “Opinion-Editorial” in which she said: “Premier Christy Clark has made a commitment to set up and fully fund an Office of the Municipal Auditor General for British Columbia.” Some local politicians worry the province is going to force them to raise property taxes in order to fund the program that would add another level of bureaucracy and interfere in municipal politics. It’s all in the spin and Chong did her best to get the government’s spin out in every community before local politicians arrived at the Vancouver Convention Centre.

Chong’s Opinion-Editorial offered assurances that a Municipal Auditor General would not make or overrule policy decisions of local governments and she repeated that the province will fund the office. It is an open question how effective a Municipal Auditor might be; the province occasionally responds to the provincial Auditor General by simply saying it disagrees with the auditor. We haven’t issues where that response has produced a public backlash that forced the province to change its ways.

Chong suggested the Municipal Auditor would do several value-for-money performance audits every year. She wrote: “For example, did funding a new water conservation campaign achieve its objectives of reducing water consumption during peak summer usage? Can a municipality optimize its fire services by delivering the services itself or through a contract with a larger adjoining municipality?” Many municipal politicians and their staff are probably offended by those examples. Council watchers throughout the province already see reports similar to what Chong suggests the Auditor would prepare. Most importantly, unlike how the BC Legislature operates, at municipal councils citizens can make presentations and put questions to staff who are present to defend their reports. Maybe the change that is needed is to make Legislative Committees more like municipal council and committee meetings.

Neither Chong nor Clark has said what the budget would be for a Municipal Auditor General. The provincial Auditor General saw his budget cut in fiscal year 2003-04 by the BC Liberal government; they imposed deeper cuts on his office in 2004-05. Those were years when Christy Clark was deputy premier. For 2011-12 the Auditor has a budget of $15.752 million, almost twice as large as the budget for any other officer of the legislature. Given past budget cuts to the Auditor General’s Office, it is understandable that local governments are concerned that what starts as a provincially funded Municipal Auditor General could change in a few years to a new cost downloaded on municipal property taxes.

The BC branch of the Canadian Federation of Independent Business (CFIB) has been lobbying hard for a Municipal Auditor General. It argues that: “Establishing an independent provincial municipal auditor general would ensure all municipalities conduct themselves as though they could be audited next year. Not solely a source of criticism, a municipal auditor general would also help share best practices among different municipal governments to ensure that a similar standard of fiscal responsibility and efficiency is being upheld by all municipalities.” Part of the role of the UBCM is to share information between municipalities. When a job description is drafted for the Municipal Auditor General, it should be clear on how services provided by that office will be different from those that already exist. Municipal politicians come face-to-face with local voters at every council meeting. Those are the folks who focus their attention, not fear of an audit.

At the September 27th session of the UBCM, Chong and Ministry staff provided an overview of their work to date on the Auditor and a UBCM policy paper was discussed. Several participants live-Tweeted from the workshop. The UBCM paper proposes a policy to work with the province on legislation for a Municipal Auditor General subject to certain principles that would limit its scope and make it accountable to municipalities. One of the key principles is that the legislative empowerment of a Municipal Auditor General should not exceed that typical of a federal or provincial Auditor General, and the Municipal Auditor General should be specifically prohibited from considering the merits of local government program policy or the objectives of local governments.

The UBCM policy paper points out there isn’t a Municipal Auditor General anywhere in Canada with the responsibility for auditing more than one municipality. Christy Clark appears anxious to break new ground rather than adopting ideas that have been tested elsewhere. On September 29th a resolution will be debated to adopt the policy set out in the UBCM paper .

Tweeting from the UBCM, Shachi Kuri, CFIB’s BC & Yukon Director, wrote:

"#ubcm delegate asks if munis will be paid for staffers time spent on MAG audits, @Ida_Chong replies performance audits not so exhaustive.”

If Chong thinks the municipal value-for-money audits will not be “exhaustive”, then how can she assure anyone that the effort will be worth the cost?

There is some similarity between the idea of a Municipal Auditor General and the ideas of recall and initiative. In 1991 voters were asked whether they wanted recall and initiative legislation, but virtually nothing was said about how it would work. For the following fifteen years debates took place over whether the legislation was too hard to use. Bill Vander Zalm used it successfully to force a vote on the HST (although that vote used the Referendum Act). Like those appealing citizen empowering concepts, the notion of an Auditor is like the notion of motherhood. The devil is in the details. It is unlikely that the vast expectations of the CFIB could be met without causing a major pushback from local politicians throughout BC. Chong’s statements already show back-peddling on what to expect from such an office and we haven’t even seen the legislation for it.

Debate over a Municipal Auditor may still be going on in May 2013 during the next provincial election, but it is unlikely to trump dozens of other issues so as to be vote determining. It offers the potential however to alienate enough local politicians to further erode support for the BC Liberals under Christy Clark’s shoot-first-aim-later approach to public policy.