Whole ‘loto’ money

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Candour is one of Blaine Higgs’ more endearing qualities. As finance minister under the former Progressive Conservative government in New Brunswick, he was always good for a quote that would, as often as not, knock you back on your heels. “Did he just say that?”

So, it should come as no surprise that when asked to explain his department’s use of $14 million in payments for shared gaming revenues made in error to the province’s First Nations communities years ago, he had this to say to the Saint John Telegraph-Journal last month:

“It was there as a potential bargaining tool to say if we get satisfaction in other areas we’ll discuss (the more than $14 million in overpayments). But if we don’t we’ll go after the$14 million.”

Mr. Higgs further explained that his government was prepared to let the largess stand only if it could obtain undertakings to stamp out illegal video lottery terminals, alcohol and cigarette sales on First Nations. It also sought to renegotiate broader revenue-sharing agreements that, it believed, benefitted only a few of the 15 aboriginal communities in the province.

Arguably, none of this would have come to light had the T-J failed to embark on some truly enterprising reporting. But now that the cat’s out of the bag, should we be surprised by the revelation that at the root of politics-as-usual is, frequently, real politick as deal making?

It’s hard to fault Mr. Higgs and his finance department operatives for attempting to make the most of a useful mistake they, themselves, did not commit. (The blame for the overpayments lies squarely with the Atlantic Lottery Corporation, which, apparently, first made the accounting error back in 2003).

On the other hand, someone owes the province’s taxpayers – a point that New Brunswick Auditor-General Kim MacPherson is all too happy to emphasize. Recouping the funds from the recipients, she told the T-J last month, “would definitely have to happen over a period of time in consultation with the First Nations given it’s a very significant amount of money and recognizing it would definitely impact the First Nations. It happened over many years, so it stands to reason that it would take quite a period of time to negotiate repayment terms. But the thing is there was no authority to make those payments and that’s why we say it needs to be corrected.”

On the face of it, she’s right. But it seems broadly unfair to expect those who unwittingly benefited from a clerical error to shoulder the burden of redressing the mistake. That would be a little like demanding that a taxpayer return his refund years after the money had been spent.

The other logical option is to require Atlantic Lottery Corporation to dig into its own corporate pockets. Still, that, too, is fraught with difficulties. As the gaming company is actually owned by the governments of the four Atlantic provinces any repayment would amount to a zero-sum exercise in futility. Or, as our favorite quote-maker Mr. Higgs said last week, “It’s kind of like taking your wallet out and paying yourself. It may not be a net gain.”

All of which suggests that the former finance minister’s solution – to make the best of a bad deal – might not be such a weird idea, after all.

If the current government can figure out a way to cost out $14 million in savings to the province from a better bargain with First Nations, then the matter might be resolved without further strife and with one benefit that’s been sorely missing from this whole debacle: transparency

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