Alberta health exec out after lavish spending revealed on meals, car phone

EDMONTON – The chief financial officer for Alberta’s health system quit Wednesday after documents were released showing a history of taxpayer-funded lavish spending on meals, social events and a phone for his Mercedes.

The resignation of Allaudin Merali came just weeks after he was hired by Alberta Health Services and three years after he left Ontario’s health system under a similar dark cloud of publicly-paid-for largesse.

Merali’s departure was announced by Alberta Health Services at a hastily called news conference in Calgary just hours before the CBC was to air a story on Merali’s spending, which it had turned up in a freedom of information request.

Chris Mazurkewich, the acting CEO of Alberta Health Services, said while the lavish spending occurred while Merali was in his old job as CFO for the now-defunct Edmonton health region, the optics make the situation intolerable.

“We were concerned it would detract from his ability to act as CFO, and we’ve taken difficult but necessary steps to ensure public confidence,” said Mazurkewich.

“After discussion with Mr. Merali, we agreed he would leave Alberta Health Services.”

Mazurkewich would not say if Merali was fired or if he quit, adding that the severance pay is still to be worked out.

“We mutually chatted and we’ve ended the employment contract,” he said.

Merali was not at the news conference and could not be reached for comment.

The AHS later posted the spending documents online. Mazurkewich said they will soon be posting all executive expense reports online and have asked the auditor general for any advice on how the organization can be even more transparent.

“We would welcome any recommendations,” he said. “We must demonstrate in both policy and action our commitment to meet Albertans’ expectations.”

Alberta Health Minister Fred Horne will hold a news conference Thursday to discuss the situation, but in a news release Wednesday said he was satisfied with the action that’s been taken.

“While travel and hosting expenses can be part of regular business, institutions such as AHS are funded by taxpayers’ dollars and, as such, taxpayers rightly expect accountability.”

The CBC search focused on 2005 to 2009, when Merali served as the chief financial officer for the Edmonton and area health region.

During that time, according to the CBC, the documents show Merali billed taxpayers for thousands of dollars for two to three meals a week at high-end restaurants with little or no explanation.

He also billed close to $1,900 for an event at a golf course, but couldn’t say what it was for. Taxpayers paid almost $1,750 to fix his Mercedes and anted up another $2,000 to have a car phone installed.

The total bill for the five-year period was $346,000

His annual salary then was $487,000.

Merali – considered a leading expert in implementing electronic health data systems – left Alberta in 2009 when all the health regions were amalgamated into the current AHS superboard.

He then moved to Ontario to consult the province on electronic health records.

In Ontario he became a controversial figure when documents released under freedom of information rules revealed that in 2009 he was among a number of health consultants charging thousands of dollars to taxpayers for meals and perks.

He billed taxpayers $2,750 a day on top of a $75 per diem, rent on an Ontario apartment, repeated flights to and from Edmonton, expensive meals out, and $14.95 drinks at Toronto’s Fairmont Royal York Hotel.

His bill averaged about $76,000 a month until his contract was not renewed in June 2009.

Mazurkewich said when they hired Merali this spring to become the CFO for the superboard, they were not aware of the lavish spending in his previous term in the Alberta system.

He said they knew about the Ontario spending controversy, but were satisfied it would not be repeated.
“We considered Mr. Merali’s experience in the Canadian health-care system, his talent, and we did have discussions when we hired him about our current policies and practices and expectations,” he said.

He said Merali had kept his spending in line since being hired.

However, the CBC also noted that Sheila Weatherill, currently a board member at AHS, was the CEO of the Edmonton health region from 2005 to 2009 and signed off on Merali’s expenses.

“What, if anything, are you going to do about her?” Mazurkewich was asked by a reporter.

Mazurkewich, who answers to the board, replied, “I’m not in a position to comment.”

Opposition Wildrose party leader Danielle Smith condemned Merali’s spending and the culture she says spawned it.

“The public service is merely following the example set by the government,” said Smith in a news release.

“When we’ve got defeated MLAs collecting millions in severance packages, health executives receiving fat bonuses for underperformance, and the premier herself approving huge pay hikes for cabinet, nobody should be surprised when instances like these come to light.”

The lobby group Friends of Medicare called it another example of the Conservative government’s confused priorities.

Given his history in Ontario, “I’m curious why he was chosen to act as the individual responsible for the entire financial and reporting structure of Alberta’s health board,” said spokeswoman Sandra Azocar.

“The people of Alberta want their tax dollars spent on front-line workers and world-class health delivery, not lavish dinners and executive travel.”

NDP Leader Brian Mason said Merali’s sudden departure “shows the extent to which this PC government cannot be trusted. They’re not interested in ensuring that money for health care in this province is spent wisely and they’re not interested in transparency and accountability.”

It’s not the first high-profile departure for Alberta Health Services. In the fall of 2010, then-CEO Stephen Duckett and the agency parted ways after he rebuffed reporters at an emergency meeting by saying he was busy eating a cookie.

AHS later revealed his severance amounted to more than $735,000.