TORONTO — A dispute between Ontario’s Liberal government and the auditor general over the province’s true deficit may be doomed to repeat itself next year.
Auditor general Bonnie Lysyk’s office and public-sector accountants disagree about how a pension surplus should be counted.
Under rules the government has been using for more than a decade, the deficit for 2015-16 would be $3.5 billion, but Lysyk says the rules should be changed and that would leave the deficit at $5 billion. Lysyk’s accounting method would also add $10.7 billion to the net debt.
Since the government wouldn’t have access to a surplus in the public servants’ and teachers’ pension plans, it therefore shouldn’t appear on the books, Lysyk says.
The Liberals are setting up an outside expert review panel to look at the issue, but neither the government nor the auditor are bound by the panel’s findings.
“I work for the legislative assembly, so if there’s new information obviously I’ll take it into account and see if that changes our opinion,” Lysyk said. “If there isn’t new information I feel pretty solid that we got it right.”
Treasury Board President Liz Sandals acknowledged that the auditor general can issue whatever opinion she wishes, but an external review isn’t pointless.
“We will at least have more expert advice,” Sandals said, even if Ontario ends up in the same dispute next year. She did not yet know what it will cost.
The government is supposed to table its public accounts – with the auditor general’s opinion – within 180 days after the end of a fiscal year, but because of the disagreement that deadline was missed this year.
Instead, the government released its unaudited financial statements but used the auditor’s preferred accounting treatment.
Lysyk submitted her audit opinion Wednesday, so it is expected to be tabled in the legislature soon.
Progressive Conservative Leader Patrick Brown questioned why an external review is needed, when the auditor’s function is to provide independent oversight.
“It’s just bewildering,” he said. “We have oversight, we have independent legislative officers. The fact the government doesn’t like the fact the independent, third-party review disagrees with their numbers…It’s like someone looking for a second opinion and keeps on looking for a second opinion until they get one that agrees with them.”
NDP Leader Andrea Horwath suggested the dispute is political.
“We have watchdogs that are doing work on behalf of the people of Ontario and the Liberals continue to try to discredit them,” she said. “That’s not appropriate.”