June 9, 2011 / 3:39 PM / in 6 years

Watchdog raps Canada for hiding G8 spending plans

OTTAWA (Reuters) - Canada’s government misled legislators about funding an international summit in 2010, pumping millions of dollars into the electoral district of the cabinet minister now responsible for spending cuts, the federal auditor said on Thursday.

In the latest in a series of often damning reports about spending practices of successive governments, the auditor general’s office took aim at the ruling Conservatives over their handling of the Group of Eight summit in Huntsville, Ontario.

It said the government hid plans to pump most of a special C$50 million ($51 million) fund into the region, the constituency of then-Industry Minister Tony Clement.

Clement is now head of the Treasury Board, and is responsible for implementing C$11 billion worth of spending cuts over the next four years.

“The government was not being transparent about its purpose. Parliament was not provided with a clear explanation of how these funds were to be spent,” the auditor general’s report said.

The report will embarrass the Conservatives, who came to power in 2006 promising greater government accountability and less waste. The Conservatives won a majority in Parliament in last month’s election.

Critics have long charged the government used the special fund to improperly boost Clement’s electoral fortunes.

The money -- supposed to help the region prepare for the summit and boost security -- was spent on 32 projects, including a gazebo, a town clock, street lighting, fountains, public washrooms, sewers and infrastructure improvements far from the summit.

Most of the money was spent in Clement’s district.

Clement only narrowly won his seat in the 2006 election which brought the Conservatives to power. In the 2008 election, held after the summit venue was announced, he won easily, as he did again in the May 2 election.

The opposition Liberals said the report showed “gross mismanagement and callous disrespect for public funds”.

The auditor general also complained that bureaucrats had been shut out of the process of choosing the 32 summit projects. This strongly suggests the funding decisions were purely political.

“I am very concerned that documentation was not available within the federal government to explain how or why these 32 projects were selected,” interim Auditor General John Wiersema said in a statement.

The C$50 million is much greater than an equivalent C$5 million fund the previous Liberal government devoted to the 2002 G8 summit in Kananaskis, Alberta.

The auditor general also found that the government had grossly overestimated how much it would cost to host both the G8 summit and a summit of the Group of 20 nations which followed immediately afterward in Toronto.

Ottawa initially said it would need a total of C$1.1 billion for both events but spent C$664 million.

Reporting by David Ljunggren; editing by Peter Galloway and Rob Wilson

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