A Question of Accountability

Frontier Centre, Local Government, Media Appearances, Role of Government, Taxation, Uncategorized

It may well be that Saint John is a highly efficient and brilliantly run city, says David Seymour.

But if that’s the case, why not make the city’s audited financial statements instantly available for the world to see, he asks.

Seymour, an analyst at the Frontier Centre for Public Policy, has put together the The 2008 Local Government Performance Index that assesses the financial health and public accounting disclosure of 79 Canadian municipalities based on their audited financial statements.

The problem is, Saint John’s financial statements are not readily available and Seymour finds that curious.

“There is no good reason. There’s an obligation, in our view, for municipalities to report these things,” Seymour said.

“You have to wonder what the whole organization’s commitment is to being accountable.”

Nancy Moar, the city’s communications officer, said financial statements are readily available to citizens who request them through the finance department but are not posted on the city’s website because it needs an upgrade before it can handle them.

The Frontier Centre for Public Policy is an independent, non-profit organization that undertakes research and education in support of economic growth and social outcomes.

Of the 79 Canadian cities the index’s authors looked at, 90 per cent were able to answer all of the questions asked, which ranged from capital assets and user charges to protective services and recreation and culture.

Out of 46 queries, Saint John was able to answer only about a dozen; and they were based on 2006 data because 2007 information was not available.

British Columbia cities, on the other hand, have audited financial statements immediately available and accompanied by running commentaries that explain the numbers.

“So people know what the municipalities are trying to achieve and how much it’s costing,” Seymour said.

Most of the cities that could not answer questions were located on the East Coast, Seymour said.

“Generally, the best reporting is found in British Columbia and the worst in the Maritimes.”

Moncton’s statements had a disclaimer, for example, saying they had not been prepared in compliance with generally accepted accounting practices and were not for use by anyone other than the mayor and council.

As a whole, the index reveals large differences between the financial health and disclosure standards of Canadian municipalities, Seymour said.

“While these differences can often be explained by differences in provincial legislation, city size or geography, it is up to the municipalities to provide those explanations,” he said.

In the majority of cities, a breakdown of what sort of resources are employed by a municipality to deliver services is readily available – but not for Saint John.

“Do they pay staff in-house, contract things out, buy goods and materials? We weren’t able to get that data, along with many other things,” Seymour said.

Seymour said the index is important because municipalities, which typically manage about $15,000 per household in capital assets, tend to get the least attention.

He said they found Saint John is more reliant on taxes, compared to other municipalities, Seymour said, which begs the question does the city need to make greater use of user fees?

Seymour believes it’s time for the city to start putting its audited financial statements online with a mere three or four clicks from the home page.

“I think that’s the least that the people of Saint John can expect.”