Watchdog praises Canada stimulus, raps chopper buy

Tue Oct 26, 2010 6:31pm EDT
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By David Ljunggren

OTTAWA (Reuters) - Canada's government-spending watchdog eased political pressure on the minority Conservative government on Tuesday with a report that said a C$48 billion ($47 billion) two-year stimulus program had been well planned.

But Auditor General Sheila Fraser, who helped bring down a previous Liberal government by uncovering a spending scandal, also said Ottawa had unfairly awarded U.S. company Boeing Co a sole-source contract to upgrade Canada's helicopter fleet.

The tone of the report on stimulus could disappoint the opposition Liberal Party, which trails the Conservatives in the polls ahead of an election widely expected in the first half of 2011.

The Liberals have repeatedly condemned the way the government implemented the stimulus program, which was designed to help fend off the worst of the recession. The program is due to end in March 2011.

"We found that the government put in place appropriate practices and that it approved projects in a timely manner," wrote Fraser, noting Ottawa had been "able to pull together and react quickly to urgent and unforeseen situations such as the global economic downturn".

Fraser's report was based on an audit of 11 of almost 90 separate programs set up to stimulate the economy. A second report on how the money was spent is to be released in October 2011.

Opposition legislators complain that the Conservatives skewed the stimulus program to favor projects in parliamentary constituencies controlled by the ruling party.

Michael Ignatieff, leader of the Liberal Party, said Fraser had not been able to verify the government's claims about the numbers of jobs created.   Continued...