Council Pushing for LESS Transparency
Council has "faith" in staff while forgoing long-standing requirement of reviewing monthly financial reports.
No. There isn’t a typo in the headline. In an age where most legislative bodies are attempting to add transparency, West Nipssing is doing the opposite.
At the February 6th council meeting, Councillor Anne Tessier brought up the topic of transparency because for some reason councillors had stopped receiving monthly disbursements reports since 2022.
As per the municipal bylaws, prior councils have always received a monthly disbursement report outlining all the major expenses of the municipality from month-to-month.
This isn’t the first time that this issue comes up at council. In 2019, staff attempted to discontinue offering this monthly report but faced backlash from some councillors who believed it was imperative continue seeing these reports.
At the time staff, complained that a change in software made it difficult to provide the monthly reports that had always been shared before 2019.
Council disagreed with this plight and forced staff to continue disclosing monthly reports. Led by Yvon Duhaime, council voted and passed bylaw 2019/134 in March 2019 that required staff to provide these reports monthly without exception.
A few months later, council passed the official “Accountability and Transparency Bylaw” (bylaw 2019/55). This bylaw specified in section 4.2 (financial matters) that the municipality will provide “monthly disbursements sheets”.
I spoke to a former member of council on this subject to understand the nature of these monthly reports. This former elected official noted that these reports were very important. They stated that these reports were not overly large, they excluded payroll and no personal information was disclosed. They were a great tool to spot irregularities. They noted that in prior years, it allowed council to uncover and question possible conflicts of interest involving former councillors and senior staff.
That may be part of the reason that staff (and some councillors) did not want to share these reports back then. And they appear opposed to the idea once again. They also appear to admit and seem indifferent that they are in stark violation of an important bylaw.
The city’s Director of Corporate Services told council last week that they did in fact discontinue this monthly report once again because “software issues made them difficult to produce”. She stressed to council that “their finances and procedures are audited by our third-party auditors on an annual basis.”
Councillor Fern Pellerin spoke up on this point and noted that auditors (especially doing annual audits) will not necessarily find monthly irregularities or catch instances of fraud.
Last month, the city of Sudbury was defrauded for $1.5M after staff mistakenly paid a thief pretending to be one of their contractors. Many Canadian municipalities have faced similar scams over the last couple of years. In Sudbury’s case, staff did not even notice the scam until over a week later. Making the possibility of recuperating the funds very difficult. Certainly extra sets of eyes on disbursements may have found this error sooner.
West Nipissing’s History of Fraud
If there is any municipality that should be welcoming extra financial controls (or maintaining the existing ones), it’s West Nipissing.
Less than six years ago, West Nipissing council closed a dark chapter of financial transparency. In 2018, the city’s former Manager of Public Works was formally sentenced for having defrauded the municipality. A few months, prior, West Nipissing’s Director of Operations formally pleaded guilty as well.
Yes. Less than ten years ago this town was robbed of up to $500,000 for work never completed. And senior staff were involved. This all happened under the same senior executives leading the municipality today.*
*West Nipissing CAO and Director of Corporate Services/Treasurer have been in their respective positions for over ten years.
This is largely why the 2019 council wanted these reports to continue being produced and the reason for the bylaw being enacted.
Last week, Councillor Tessier noted council has a responsibility to review the activities of the organization to ensure that council meets their obligations. She proposed that these reports be presented to council as was the case in 2022 (as per the municipal bylaw). Unfortunately the only voice to agree with Tessier was councillor Fern Pellerin.
Mayor Kathleen Thorne-Rochon began the discussion with what appeared to be a pre-planned skit with the Director of Corporate Services, Alisa Craddock where she appears to mock Tessier’s request to receive the legally required monthly reports.
Then deputy mayor, Jamie Restoule follows with his reliable aversion to opposing the mayor or staff in any way. Restoule, who was a councillor in West Nipissing until 2016 and was around when significant irregularities were caught, acknowledged the value of these reports.
“You’d get the odd questions. But if were to invest a lot of human resources into developing this report that’s going to generate very small questions probably, I don’t think that’s a task I want to put on them…”
He added “I’m comfortable with our staff and I wouldn’t want to create extra work for them to create something that we probably won’t have any questions related to it.”
Then in usual fashion, councillor Roch St-Louis, backed up the mayor and deputy mayor. Because he has faith that staff are ethical… And he is “hopeful” that they do well… He told council that if an auditor finds a fraud or irregularity later on, then they will deal with at that point.
“I have faith in the people that are in place where they are right now where that they are going to do their due diligence according to what the ethics are. And hopefully they do well. And if an auditor does find anything, then there is consequences and we will go through the process at that point in time.”
Not a single councillor criticized staff for having ignored and violated the transparency bylaw (requiring monthly reports) for nearly two years before being caught.
Compromise Sought but Turned Down
After Craddock repeatedly told council that producing monthly disbursement reports was simply impossible* (although it was being produced up until late 2022 with some sort of work around), Councillor Pellerin and Tessier seeked alternatives.
*This is a subject for a further analysis because I cannot comprehend why such a report is so difficult to produce and why it is not already being looked at by the helm of the organization.
Craddock admitted that a cheque registry could be provided to council which would likely be a dozen or so pages each month. She noted that such a report would be easy to produce but would not be as detailed as a monthly disbursement reports. Pellerin and Tessier stated they would want to see it.
But Thorne-Rochon appeared to be opposed to councillors seeing this report and was able to rally her usual support from the six other councillors to squash this seemingly reasonable proposal.
Amending the Transparency Bylaw
After councillors and staff expressed no desire to follow the transparency bylaw passed in 2019, the discussion moved to amending this bylaw to legalize this obvious violation that has been occurring for almost two years.
The bylaw will be brought to the next meeting with an amendment to remove the requirement that council be provided monthly disbursement reports, making the transparency bylaw much less transparent.
Councillors will vote on the new amended bylaw at the next council meeting.
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