The committee will not seek a forensic audit of the employment agency that mishandled the funds


Audit is called key to public accountability and exoneration of employee ‘heroes’

Nova Scotia’s public accounts committee will not seek a forensic audit of a Cape Breton disgrace agency that mismanaged public funds.

A motion by NDP MP Susan Leblanc calling on Nova Scotia’s auditor general to conduct a forensic audit of Island Employment failed to pass at Wednesday’s committee meeting.

The committee was examining the provincial government’s oversight of Island Employment, a provincially-funded third-party organization that provides employment services in Cape Breton.

A forensic audit would include gathering evidence from the agency’s financial records that could be used in court.

The Department of Labour, Skills and Immigration terminated its contract with Island Employment in November 2021, after an investigation by the Nova Scotia Ombudsman found “gross misuse or mismanagement public funds or assets”.

Former Island Employment employees triggered the ombudsman’s investigation by reporting their organization’s behavior under the protection of the whistleblower law. After the department canceled the contract, Island Employment closed, leaving all 30 employees unemployed.

NSGEU chairman calls for forensic audit

The department paid former employees eight weeks of severance pay and ensured that the acting employer’s job training requirements were no greater than what former employees already had.

However, the president of the Nova Scotia Government and General Employees Union, Jason MacLean, said what happened to the former employees was “unfair”.

“We have 30 people walking around their communities with a cloud over their heads, they don’t feel as confident applying for other jobs. They weren’t exempt; they have just been painted with a wide brush.

MacLean said ex-employees are “heroes” and that a forensic audit would clarify the bad actors within Island Employment and “exonerate our members who … no longer have jobs and must now apply for jobs. jobs that the government could have just stepped in and provided.”

MacLean also said the outcome for former employees could shake public confidence in whistleblower legislation.

“I believe damage has been done to… the public’s view of government. Because if someone is going to come up with something, they’re going to first ask themselves “how is this going to affect me negatively?” ”

NSGEU President Jason MacLean speaks via video conference.
NSGEU Chair Jason MacLean addresses the Nova Scotia Public Accounts Committee via video conference. MacLean seeks a forensic audit of Island Employment on behalf of his union members. Claire Henry

NDP member Claudia Chender also said that this whistleblower law would harm, known as the Public Interest Disclosure of Wrongdoing Act.

“We have a situation where the department didn’t catch this wrongdoing, it was reported by an employee, and then every employee lost their jobs in violation, I would say, of that law,” Chender said. .

Ministry says forensic audit not necessary

Deputy Minister Ava Czapalay said the Department of Labour, Skills and Immigration will not conduct a criminal check because it is not required.

“We don’t believe a forensic audit would reveal any additional information to what the ombudsman was able to find.”

Czapalay said the ministry decided to terminate the contract based on information from an interim and final report by the mediator. The reports are not public. She said the report also contained recommendations for the department, which they supplemented.

MacLean said that ends public accountability.

“We are supposed to be accountable to Nova Scotians. And I don’t believe the government does that by just saying ‘we’ve passed things that you can’t see,’” he said.

“I can’t even speak of a fail-safe that has been put in place. And we’ll never know unless we get that full forensic audit.

A forensic audit by the provincial Auditor General would be public.

Regarding the department’s relationship to the Island Employment investigation, Nova Scotia Ombudsman William A. Smith said, “I would say there was oversight. I don’t think it was close.

Smith said he recommended the department consider a forensic audit and was initially interested. Czapalay said the department considered a forensic check.

Island Employment is now the subject of a police investigation. On January 18, the department announced that te YMCA Cape Breton and Nova Scotia Economic Development Council will take over the former role of Island Employment.

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