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EY auditors to defend report

Sheegl, Shindleman, top administrators won't be at meeting

Live Blog EY auditors to defend report

An unusual meeting of Winnipeg city council takes place this morning as members of the forensic auditing team that examined 33 real estate transactions explain and defend their report.

Members of council will question city auditor Brian Whiteside and the three-member team from consulting firm EY, whose scathing report exposed the city for not having key policies in place for real-estate transactions and for repeatedly breaching procedures as they dealt with some members of the city's development community.


Phil Sheegl

Phil Sheegl

However, senior members of administration will not be available to answer questions this morning about their involvement in the real estate transactions.

Coun. Paula Havixbeck said the absence of the administration from today's meeting is another attempt to discredit the EY audit and to ensure no one is held accountable.

Chris Leo, a retired political studies professor who spent a career observing the goings-on at city hall, is also concerned about what's happening vis-a-vis the audit.

"City council should be making every effort to get to the bottom of this situation and to fix it," Leo said.

Leo said the EY audit is damning and council needs to take immediate action, adding the decision not to have senior administrators at the meeting to explain their actions will make it difficult for council to fix the problem.

"At the very least, there's been some serious sloppiness in administration and at the worst, who knows -- this could be far more serious than that," Leo said.

"At some point, the administrators need to explain their actions. They've got some explaining to do." Mayor Sam Katz and others, including former CAO Phil Sheegl and Shindico president Sandy Shindleman, dismissed the audit findings.

Katz said the audit is only a review, full of "innuendo and opinions," and lacks hard facts to support the EY recommendations. He also questioned why EY failed to interview Sheegl and Shindleman. "I read it and I didn't see any innuendo," Leo said of the EY audit. "Mayor Katz is absolutely wrong when he tries to dismiss this report. It has serious substance and raises issues that need to be addressed."

Will council address the issues -- a flurry of motions that some councillors are preparing for today's meeting suggest some of them are serious about fixing city hall.

Coun. Russ Wyatt said he expects all of the recommendations from the EY audit will be accepted by council, but added there will be other moves today to build on what EY uncovered through a series of motions, including:

-- Coun. John Orlikow will propose the entire EY audit be referred to Manitoba Justice for a review about a possible police investigation.

-- Coun. Ross Eadie wants another consulting firm to monitor and ensure the administration implements the recommendations from the EY audit.

-- Wyatt wants council to create a new position to monitor and scrutinize real estate deals -- a fairness commissioner who works under the direction of the city auditor's office.

"This is a historic low point for Winnipeg city council," Coun. Jenny Gerbasi said. "The public trust has been severely damaged and ultimately it will be the new city council and the new (chief administrative officer) that will have the chance to rebuild that trust."

Leo said council needs to find out the circumstances that led to the policy breaches EY uncovered and quickly deal with them.

"If there's been serious administrative mismanagement, they need to address that as the politicians who are responsible for the actions of the administration," Leo said.

Coun. Harvey Smith said he remains convinced the EY audit justifies terminating some staff, but he doesn't believe the majority of councillors are willing to go that far.

"To restore trust at city hall, some of the people at the top have to be dealt with," Smith said, adding it's not realistic to pin the blame for what's wrong with city hall only on Sheegl.


Republished from the Winnipeg Free Press print edition July 9, 2014 B1


Updated on Wednesday, July 9, 2014 at 11:49 AM CDT: Adds live blog.

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