More than $3 billion in federal funding allocated for public security and anti-terror projects is unaccounted for, Auditor General Michael Ferguson says in his latest report.
After Ferguson released his spring report Tuesday, he said there was no evidence that the money was spent inappropriately, but noted it wasn't on the books either.
"One of the questions we asked was how much money had been allocated out to the various departments and how much money had been spent," Ferguson told reporters in Ottawa.
"The departments were properly reporting back on how much they spent, but what they spent amounted to roughly $10 billion and what was allocated amounted to roughly $13 billion, so there was a difference there between what was allocated and what was spent."
The money was allocated through the federal government's Public Security and Anti-Terrorism Initiative (PSAT) fund and was administered by the Treasury Board of Canada Secretariat.
According to the report, $12.9 billion in funding was allocated by the Treasury Board for PSAT "initiative activities" between 2001 and 2009. Departments and agencies reported spending $9.8 billion.
Ferguson said his office asked the Treasury Board for more details on the spending, and was told that departments and agencies were typically restricted in the type of project they could spend the money on. However, the funding could be reallocated to other projects if the department could demonstrate that the original initiative would not be negatively affected as a result.
Ferguson and his team were told that discussions around the reallocation of funding would have taken place between various government departments, but that "financial information on reallocations was not captured."
Where the money may have gone
Several possible scenarios were outlined in the report to explain where the money may have gone:
- The funding may have lapsed without being spent
- It may have been spent on PSAT activities and reported as part of ongoing programs spending
- It may have been carried forward and spent on programs not related to PSAT
"We didn't identify anything that gave us cause for concern that the money was used in any way it should not have been, however it's important that there be a way for people to understand how this money was spent. That summary reporting was not done so it's a matter of missing that last link in putting the information all together," Ferguson said.
He added that by not accounting properly for how the money was spent, the government may have missed an opportunity to tout its anti-terrorism efforts.
Government reacts
Treasury Board President Tony Clement responded to the report later Tuesday, reiterating Ferguson’s comments that there was no evidence of misspending.
He said a number of programs, such as the arming of border guards, marine security operations and anti-terror deployment initiatives in Afghanistan were funded under PSAT but remained “outside of the categorization mechanism set up by the Treasury Board Secretariat,” and would therefore not show up in the books Ferguson looked at.
He added that spending details weren’t provided for sensitive public security projects and said in some cases programs are ongoing and spending has simply been rolled forward into future years.
“I want to make one thing clear -- there is no indication from the auditor general that any funds have gone missing, that any funds have been misappropriated or that any funds have been misspent,” Clement said.
“And I just remind ladies and gentlemen of the media that all government spending, every nickel and dime is reported to Parliament and accounted for each and every year in the public accounts.”
