Winnipeg Free Press - PRINT EDITION
Flood recovery initiatives need better oversight
BRANDON -- As the three levels of government prepare to write cheques totalling hundreds of millions of dollars to cover damages suffered during this summer's flooding, they would be wise to first consider lessons that should have been learned after the 2011 flood.
In the months following that flood, there were numerous allegations of evacuees who chose to live in hotels and receive other subsidies and "reimbursements" despite the fact that they had other places to stay and did not need the money. In some cases, the evacuees weren't evacuees at all -- they didn't actually reside in the evacuated area.
Other Manitobans claimed they had been encouraged to submit disaster relief claims for damages that had nothing to do with the flooding.
Finally, business owners questioned large payments made under various recovery programs, including the Selinger government's Excess Moisture Economic Stimulus Program, which was intended to "help restore economic activity to pre-flood levels or strengthen and diversify economic activity."
Documents obtained by the Canadian Taxpayers Federation reveal one of those large payments involved a proposal submitted by the City of Brandon, which sought $100,000 in funding "to engage a Business Continuity Planning consultant to work on on one with businesses that were evacuated during the 2011 spring flood event."
The proposal was approved by the province and a Toronto-based consultant was hired to provide business continuity services for $89,040.
Of the 85 Brandon flood-affected businesses that were initially targeted under the proposal, just eight participated in the project. Following meetings with representatives of those businesses, the consultant created continuity plans for each business that emphasized the importance of good communications, and of training employees to better prepare for disruptions caused by emergencies.
When the final accounting was completed, the total cost to taxpayers for the program was $94,214.27. Of that amount, the consultant's reduced fee was $84,800, but the City of Brandon requested reimbursement for more than $9,500 in administrative costs and materials. It claimed that city staff (valued at rates of up to $72.54 per hour) had spent a whopping 141 hours working on the project.
To summarize what happened here, a project designed to revive Brandon's economy spent almost $85,000 on a Toronto consultant to provide eight local businesses with information that is mostly available for free on the Internet. That payment stimulated Toronto's economy, but it did nothing to help restore Brandon's economic activity to pre-flood levels.
That conclusion is echoed by CTF prairie director Colin Craig, who argues "Instead of spending money to fly in a handful of consultants from Toronto to help a few Brandon businesses, the government should have put the money towards flood protection to serve the entire city."
"Unfortunately, the expenditure is part of a larger government program with other questionable spending. Hopefully we don't see a repeat of this type of spending after the 2014 flood."
If the Brandon project was just one case of questionable spending in a billion dollars of otherwise valid flood-related expenses, it would be easy to ignore. As Craig alludes to, however, there have been numerous allegations of serious spending abuses following the 2011 flood, involving many millions of dollars.
Considered collectively, those allegations expose an obvious flaw in the disaster assistance funding scheme that must be quickly addressed in order to prevent similar abuses from occurring over the coming weeks and months.
Under the current process, the fact up to 90 per cent of disaster-related expenses will eventually be reimbursed by the federal government creates little incentive on the part of the provincial and local governments to exercise restraint and due diligence when it comes to disaster relief payments and projects.
On the contrary, the arrangement provides ample motivation for local governments to engage in spending that would never occur if the money was coming out of their own budgets.
That needs to change. If the federal government is ultimately picking up the tab for most of the spending, it must do more at the initial stages to ensure those tax dollars will be spent appropriately.
If it won't do that, we should expect to hear fresh allegations of improper spending following the current flood -- with taxpayers once again stuck with the tab.
Deveryn Ross is a political commentator
living in Brandon.
Twitter -- @deverynross
Republished from the Winnipeg Free Press print edition July 18, 2014 A11
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