July 22, 2014 2:01 pm

Former Alberta health exec flagged for conflict

WATCH ABOVE: An investigation into the purchase of computers by Alberta Health Services has turned up a conflict of interest. Tom Vernon explains.

EDMONTON – A former executive with Alberta Health Services has been rebuked by the public interest commissioner for breaking conflict-of-interest rules.

Peter Hourihan says the senior IT official delivered a $75,000 sole-sourced contract to a firm in late 2012.

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“The senior AHS executive was previously a partner with the awarded corporation and was a shareholder when the contract was awarded,” Hourihan said Tuesday.

“This is a significant issue. A senior executive should have understood the importance of declaring a conflict when one arises.

“There’s no question around that.”

Hourihan said the official also co-signed the contract with the firm without proper authority. He did so after his subordinates signed a request to engage a consultant. They, too, did not have the authority to do so, said Hourihan.

All along the way the official was aware of conflict-of-interest guidelines, the commissioner said.

“Prior to recommending the contract, (the official) was provided a conflict-of-interest declaration document specific to the procurement of the computers,” said Hourihan’s report.

He said no disciplinary action was taken because the official has since left Alberta Health Services.

Hourihan declined to name the official, saying he didn’t consider the offence serious enough to merit it.

AHS is an arm’s-length body responsible for front-line medical care under direction from Alberta’s Health Department.

Vickie Kaminski, the CEO of AHS, said the matter took place before she arrived at the organization, but she has been told that the official only divulged his conflict after the contract was completed.

She said she didn’t know why he waited to say anything.

“Why don’t you know that?” she was asked.

“I didn’t ask that question because it wasn’t pertinent. He’s gone.”

The official left AHS for reasons unrelated to the contract, she added.

Kaminski said rules have been tightened around sole-source contracts and improved checks and balances have been brought in around conflicts of interest.

Another employee who abused signing authority over the contract has been given renewed direction on what can and can’t be signed.

“It was determined that it wasn’t sufficiently egregious to terminate them,” Kaminski said.

Opposition Wildrose critic Kerry Towle said AHS owes more to the people who pay the bills.

“Alberta Health’s response to all of this is quite frankly disgusting,” said Towle.

“You’ve got Ms. Kaminski saying, ‘It didn’t happen during my watch, so no harm no foul. Nothing to see here.’

“No respect for the taxpayer at all.”

Sole-source contracts have proven to be integral to AHS operations.

In April, the Wildrose party released documents under freedom-of-information rules showing AHS spent $990 million on such contracts over a two-year period ending in January 2013.

Hourihan’s finding was part of a larger investigation by his office following an anonymous complaint that thousands of new AHS computers were sitting unused in boxes after their warranties had expired.

He said AHS could do a better job ordering, delivering and setting up its computers, but in this case there was no “gross mismanagement” of public funds.

The computers are still under warranty and are now being used, he said.

“Measures taken by AHS to deploy the computers were reasonable given the challenges and lack of available internal resources to manage a large-scale deployment,” read Hourihan’s report.

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