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Les Leyne: Leaked audit found rampant mismanagement of housing money

B.C. Liberal critics said the full story was suppressed and minimized under Eby’s watch.
Domes of the B.C. legislature. DARREN STONE, TIMES COLONIST

Opposition B.C. Liberals released a leaked document Tuesday that raises questions about the fiscal management of one of Premier David Eby’s ­former responsibilities — ­housing.

A whistleblower supplied the Opposition with a devastating audit of a key non-profit housing agency that suggested rampant fiscal mismanagement going back years, well before the NDP took power in 2017.

The audit was ordered by the previous B.C. Liberal government in 2017 and produced in 2018, but was never released by the NDP. Eby took on housing responsibilities in 2020 and Liberals say his ministry continued funding the agency — Atira Women’s Resource Centre — despite the findings.

B.C. Housing said this year that the problems had been rectified, but the City of Vancouver subsequently refused to fund one of Atira’s properties out of safety concerns.

The audit warned cash-flow mismanagement was having “downstream consequences” on maintenance. That was brought home when one of Atira’s Vancouver properties burned down, killing two long-term residents. It was later found the fire extinguishers didn’t work.

The NDP has cited the record funding it has poured into housing in recent years. But the audit, combined with a separate one on B.C. Housing, raises suspicions about how effectively the new money is being spent.

Accountants concluded Atira’s board had incorrect, misleading information and lacked the critical thinking to do a deep analysis.

The agency was repeatedly going to B.C. Housing for budget top-ups. It was running annual deficits, filed reports late, and there was constant correspondence about cash-flow deficiencies.

The audit cited one example where Atira requested an extra $300,000 to cover one pay period, which B.C. Housing felt was unsubstantiated. It concluded only 7.5 per cent of its budget went to actual services to people.

Later, B.C. Housing developed its own management problems, revealed in a separate negative independent audit this year. Eby fired the entire NDP-appointed board a few days later, but there was no explicit explanation that it was due to mismanagement.

Tuesday’s revelations pile on top of those earlier ones.

The NDP has more than doubled the organization’s budget in recent years, to $1.9 billion.

The audit raised several criticisms. Roles and responsibilities are unclear, IT services are substandard and systems are inefficient.

Almost 20 executives have left the Crown corporation recently.

Liberal critics said the full story was suppressed and minimized under Eby’s watch.

B.C. Housing had said the Atira audit was focused on addressing some outstanding issues related to budgets. The full document now shows it was far more wide-reaching than that.

The agency has received about $120 million in funding since the audit was concluded.

Opposition Leader Kevin Falcon told reporters that multiple whistleblowers are contacting his party about where housing money is going. “We have just started to peel the onion on this. I can assure you that is why we are calling for a full independent transparent audit. Because frankly, if the public finds out what’s going on at some of these housing providers and B.C. Housing, they’re going to be horrified. … I think that this is just the tip of the iceberg.”

Falcon told the legislature that the now-departed housing board allowed the former CEO to personally approve $115 million in spending “without any discernible due diligence.”

Attorney General and Minister Responsible for Housing Murray Rankin objected to the overall characterization of mismanaged chaos.

He lauded the new boss, Allan Seckel, which is politically ironic. Seckel was a deputy to former B.C. Liberal premier Gordon Campbell.

Rankin said the government is delivering on thousands of new homes. It commissioned a report on B.C. Housing and then acted on it. He said the Atira audit was about the Liberal years, but the report specifies that it concentrated on 2018, after the NDP took over.

“The rest of Canada is envious of B.C. Housing and the extraordinary accomplishments that they have made,” said Rankin.

Subject to further revelations about where $7 billion in social housing funding is going, it looks like a desperate push to ease the housing crisis is overriding some of the routine spending scrutiny.

“There’s no effort to cut corners or to somehow deprive the public of information,” Rankin said..

Maybe not. But sometimes it happens anyway.

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