Mr. Chairman, the next area the committee reviewed was asset management in government. The Auditor General reported on his first audit of asset management. This government has some three billion dollars invested in non-cash assets such as inventories, buildings, equipment, art and other cultural items, et cetera. The committee heard testimony from the comptroller general, who has a leadership role under section 12 of the Financial Administration Act, and the deputy ministers of several other departments with specific custodial responsibilities. The committee was disturbed to hear a recurring theme that departments had control systems but none were complete, and there is no overall control and accountability for asset control. In reality, no one knows exactly what the government owns or what it is worth. This is disturbing because the assets owned represent major investment in infrastructure and other items for the people of the Territories.
The committee had no satisfaction that the various departments were doing a good job of effectively managing and controlling this large investment. The committee also expressed its concern about how little departments cooperate and work together to control and manage assets. We heard too many examples of why things could not be done rather than how departments could work together to make improvements.
The committee was surprised at the extent of cultural assets that were owned, and in many cases, not controlled property. Many cultural items were portable and valuable. These include carvings, prints and paintings owned by Culture and
Communications as well as significant other items owned by other departments. For example, Mr. Chairman, the Department of Economic Development and Tourism had a program to purchase art works and lend them to other departments. The committee heard that this is not done, and the inventory of these attractive and valuable items is not well controlled.
Other cultural items have unique characteristics that make them extremely valuable, but they are not properly managed. Meanwhile, the government warehouse contains examples of ordinary items that are not highly valuable yet take up expensive storage space.
The committee heard that many purchases of capital items are budgeted and paid for under O and M, not under capital. In many cases, items are being ordered on a component-by-component basis to get individual items in the system under the $5000 capital assets definition. This is a blatant attempt, Mr. Chairman, to avoid showing items correctly as capital assets which are under more detailed scrutiny by the Legislative Assembly, especially in these times of restraint. The committee, therefore, has four recommendations on this topic.
Motion To Accept Recommendation 15, Carried
I move recommendation 15. That the comptroller general develop a strategy to encourage interdepartmental coordination in the design of asset control systems; that he create and carry out a plan to provide maximum coordination in the design and development of inventory control systems, particularly for Department of Public Works, the Department of Municipal and Community Affairs and the Department of Transportation; and that he report on this plan to the public accounts committee, either in person or in writing, at least twice a year.