The Auditor General of Newfoundland and Labrador, Denise Hanrahan, today delivered one of two reports to the House of Assembly on the performance audit of Nalcor Energy. Today’s report contains findings and recommendations regarding Nalcor’s discretionary expenses, conflict of interest processes, and the use of embedded contractors.
The audit concluded that Nalcor did not ensure the best possible use of public money, particularly in its management of discretionary expenses and its use of embedded contractors for the project management of the Lower Churchill Project. The report identified several areas where Nalcor’s policies did not align with provincial government policy and practice. While Nalcor generally provided guidance for employees, board members and contractors that reflected the requirements of the Conflict of Interest Act, corporate processes could have been strengthened.
The report also identified several incidences where Nalcor’s lack of policy and management oversight may have led to embedded contractors being able to take advantage of privileged information, thereby providing them with the opportunity for personal and financial gain.
The Auditor General will deliver her performance audit on Nalcor’s compensation practices before the end of the year.
The full report as well as an audit overview can be found by visiting the Auditor Generals website. www.ag.gov.nl.ca.
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“By Nalcor not aligning its discretionary expense policies with government policy whenever possible, the corporation incurred unnecessary and excess expenses. Nalcor did not always ensure adherence to appropriate conflict of interest policies, procedures, and related legislation, thereby creating unnecessary risk. Nalcor also did not manage its use of embedded contractors in a cost-effective manner when hiring highly-paid contractors into technical and corporate management positions, without considering the value of these roles being employees rather than contractors.”
Denise Hanrahan
Auditor General of Newfoundland and Labrador
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Chrysta Collins
Office of the Auditor General
709-730-1568
chrystacollins@oag.nl.ca