Nova Scotia’s Auditor General Calls for Greater Accountability in Government Spending

Nova Scotia’s Auditor General, Kim Adair, has reignited her call for increased transparency and accountability in government spending, particularly for billions of dollars allocated outside the official budget process. In a newly released report, Adair emphasized that the province’s current financial practices lack sufficient oversight, making it difficult for both legislators and taxpayers to track how public funds are being used. Over the past decade, expenses that were not approved by the provincial legislature have risen to $7 billion, with $1.38 billion spent in the 2023-24 fiscal year alone without proper authorization. Adair has consistently recommended amendments to the province’s Finance Act to ensure greater scrutiny of such expenditures, but these recommendations have been met with resistance from the government. She stressed that Nova Scotia is the only province in Canada where extra-budget spending is not vetted by the legislature, a practice that sets it apart even from the federal government. “Nova Scotia is unique,” she remarked, vowing to continue her advocacy until reforms are implemented.

The Rise of Extra-Budget Spending and Its Implications

The report highlights a concerning trend in Nova Scotia’s financial management, with extra-budget spending increasing significantly over the years. In the 2023-24 fiscal year, such expenditures accounted for 8.2% of the province’s total spending, up from just 1.3% in the 2014-15 fiscal year. Adair noted that in four of the past five years, government revenues exceeded budget projections, providing the governing party with additional funds to allocate as it saw fit. While this may seem like a luxury, it raises questions about accountability and transparency. The Auditor Generalargued that the Finance Act must be amended to clearly define what constitutes new programs or activities requiring legislative approval and to demand more detailed reporting on spending outside the budget process. Without such reforms, thepublic may remain in the dark about how its money is being spent.

Untendered Contracts and Procurement Concerns

In addition to extra-budget spending, Adair’s report shed light on another pressing issue: the prevalence of untendered contracts. Over the past five years, Nova Scotia Health and other government departments issued $2.4 billion in contracts without competitive bidding. In the 2023-24 fiscal year alone, the health authority awarded $291 million in such contracts. The report also identified specific examples of large-scale agreements that bypassed standard procurement processes, including a $67.5 million contract with Shannex to operate a transitional-care facility and a $49.6 million contract with Think Research for virtual care services. While Adair acknowledged that single-source contracts may be justified in emergencies or exceptional circumstances, she emphasized that transparency, competition, and fairness are central to public trust. The increase in untendered contracts in recent years, she argued, warrants closer scrutiny.

Mixed Responses to the Auditor’s Recommendations

Adair’s findings have sparked a range of reactions from political stakeholders. Lisa Lachance, the NDP’s finance critic, echoed the Auditor General’s concerns, stating that the status quo of opaque spending practices is unacceptable. She urged the government to take Adair’s recommendations seriously and amend the Finance Act to ensure Nova Scotians are fully informed about how their tax dollars are being spent. Liberal finance critic Iain Rankinalso weighed in, cautioning that unchecked public debt and overspending could harm economic growth. He called for greater discipline in adhering to budget estimates approved by the legislature.

On the other hand, Finance Minister John Lohrdefended the government’s approach, insisting that it adheres to the Finance Act and maintains accountability and transparency. He noted that the government shares additional appropriations with the public and media four times a year, ensuring Nova Scotians are informed about taxpayer dollar expenditures. However, Adair’s report suggests that such measures may not go far enough in providing the level of scrutiny needed to restore public confidence.

The Broader Implications of Fiscal Transparency

The debate over Nova Scotia’s fiscal practices highlights a broader issue: the importance of transparency in government spending. As public trust in institutions continues to erode, citizens are increasingly demanding greater accountability for how their tax dollars are used. Adair’s report serves as a stark reminder that without robust oversight mechanisms, the potential for misuse or mismanagement of public funds grows. The Auditor General’s perseverance in advocating for reforms underscores the urgency of addressing these gaps.

In conclusion, Nova Scotia’s Auditor General has once again sounded the alarm about the need for greater accountability in government spending. With billions of dollars allocated outside the budget process and a rising trend of untendered contracts, the province’s current financial practices raise significant concerns about transparency and oversight. While the government defends its approach, critics argue that more must be done to ensure that public funds are used responsibly and with the full knowledge of both legislators and taxpayers. Adair’s recommendations represent a critical step toward achieving this goal, and their implementation is essential for building trust in the province’s governance.