Ontario’s auditor general says she found it “odd” top staff and directors at two electricity agencies got “comprehensive legal protection” for implementing the previously Liberal government’s 25 per cent hydro rate cut.
Bonnie Lysyk told a legislative committee Monday she was surprised to find details of the legal indemnity in the bottom of a box of documents turned over to her office for an audit of the controversial “Fair Hydro Plan.”
Lysyk’s 2017 audit found accounting and financing for the plan was questionable and will result in up to $4 billion more in interest costs over 30 years because the Liberal government was trying to keep $39.4 billion in borrowing off the province’s books.
“We were not aware” of the legal protection, she said Monday as Premier Doug Ford’s committee investigating Ontario’s $15 billion deficit — which he has called “the worst political cover-up in Ontario’s history” — began hearing witness testimony.
Lysyk did not provide details of the protections provided.
During almost five hours of questions from Progressive Conservative and New Democrat MPPs, Lysyk said she had never before seen a legal arrangement like the one made for Ontario Power Generation and the Independent Electricity System Operator.
“It doesn’t mean it doesn’t exist out there.”
Ford struck the committee this fall after a commission he appointed upon taking power in June determined this year’s deficit has ballooned to $15 billion from former premier Kathleen Wynne’s pre-election estimate of $6.7 billion.
The $8.3 billion difference between the estimates includes Liberal spending — such as improved child care — that Ford has scrapped.
“We’ll have more to say about that in the fall economic statement,” Finance Minister Vic Fedeli said Monday.
For all the political fanfare around the committee, with Conservatives vowing to discover how money was “wasted” and New Democrats warning it could degenerate into a “show trial,” Monday’s session was mostly a dry recitation of Lysyk’s previously known concerns about the Liberal government’s accounting for hydro and pension assets.
She did say, however, that if she were a private sector auditor and had a client who repeatedly would not listen to her concerns about meeting proper accounting standards, she would have fired the client.
“Private sector auditors can quit. We can’t quit.”
She resisted two attempts from Conservative MPP Ross Romano (Sault Ste. Marie) to call accounting for the hydro discount plan a “shell game.”
“I don’t want to use the word,” Lysyk said.
The committee does not have any Liberal members because the party has only seven seats — one shy of the number needed for official party status.
Interim Liberal leader John Fraser said Monday he did not expect much from Lysyk’s testimony given her disagreements with the former government were widely reported over the last couple of years.
“Everything’s been pretty well hashed out again and again.”
The committee has ordered emails and documents from Wynne, three of her cabinet ministers, top aides and bureaucrats by Oct. 25.
Rob Ferguson is a Toronto-based reporter covering Ontario politics. Follow him on Twitter: @robferguson1