The Nova Scotia Legislature

The House resumed on:
September 21, 2017.

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HALIFAX, WEDNESDAY, MARCH 27, 2002

STANDING COMMITTEE ON PUBLIC ACCOUNTS

8:00 A.M.

CHAIRMAN

Mr. William Estabrooks

MR. CHAIRMAN: I would like to welcome our witnesses here this morning from the Chignecto-Central Regional School Board. In a moment I will ask you each to identify yourself but first I would like to lead off by introducing myself and the members of the committee who are present today. My name is Bill Estabrooks. I am the MLA for Timberlea-Prospect. I have the privilege of being the Chairman of the Public Accounts Committee. Could my colleague, the member for Halifax Fairview, continue please.

[The committee members introduced themselves.]

MR. BROOKE TAYLOR: Brooke Taylor, Colchester-Musquodoboit Valley, the beautiful Colchester-Musquodoboit Valley.

MR. CHAIRMAN: I haven't heard that for almost four months and it's almost a relief. Thank you, Mr. Taylor.

We are expecting another member of the government caucus and he or she is not at this stage (Interruption) The member for Queens will be joining us and perhaps we will just take a quick moment to introduce him when he arrives.

Mr. Parker, could you begin your introductions please.

MR. ROBERT PARKER: Robert Parker, Chairman of the Chignecto-Central Regional School Board from the beautiful West River Valley.

MR. BRUCE MACINTOSH: Bruce MacIntosh, legal counsel for the board.

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MR. GARY MILLER: Gary Miller, superintendent of schools.

MR. RONALD MARKS: Ron Marks, Chairman of the Finance Committee.

MR. CHAIRMAN: Thank you. Yes, Mr. DeWolfe.

MR. JAMES DEWOLFE: Mr. Chairman, is Mr. Brian Murphy going to be joining the group?

MR. CHAIRMAN: Mr. Parker.

MR. PARKER: Dr. Murphy is with us, as well as our acting CFO, Val Gautier. They are in the wings here if we so require them.

MR. CHAIRMAN: Thank you, Mr. Parker. What is your wish, Mr. DeWolfe?

MR. DEWOLFE: Someone should notify them that - I believe they are in the lunch room - they could take a seat and join the group.

MR. CHAIRMAN: That would be fine. Mora, could you do that please.

MR. MACINTOSH: I believe you have on record, from us, correspondence, yesterday. What we have requested, we have undertaken to make them available if necessary, but we were hoping, we believe some of the issues they may be able to address are better addressed by the spokespersons here this morning. If your committee finds that that is not the case, then we can make them available. I think that was sort of the arrangement we had requested.

MR. CHAIRMAN: And I was aware of that. I recognize Mr. DeWolfe and then Mr. MacKinnon.

MR. DEWOLFE: Mr. Chairman, it was my understanding that Mr. Murphy was invited to sit in on this and having said so, I suggest that perhaps he should take his place.

MR. CHAIRMAN: Mr. MacKinnon.

MR. RUSSELL MACKINNON: I agree with my colleague, Mr. DeWolfe, Mr. Chairman. I think it is the prerogative of the committee to make that determination, not the legal counsel for the board.

MR. CHAIRMAN: May we invite these people to appear.

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MR. MACINTOSH: We will respect the wishes of the committee. I would request though, before Dr. Murphy is called upon, that we be given some indication of what the subject matter is because, quite frankly, all these other witnesses have at least a general understanding of the general subject matter the committee members wish to explore. We don't have any indication from the committee of what it is, and there are certain areas that we think would be inappropriate for Dr. Murphy to get involved in in terms of specific persons and personalities. Let's play it by ear and we will certainly have Dr. Murphy come in and perhaps we can address that issue when the questions are addressed to him.

MR. CHAIRMAN: I would like, therefore, as the wish of the committee, to invite Mr. Murphy and Madame Gautier to also come in. Perhaps as that is being done, I would like to remind members that I would like to have a short business meeting at the conclusion of the meeting so we will try to stay within our guidelines of 10:00 a.m.

As I conveniently fill some time, the late member - no, no, not that, really - this is the member for Queens, Mr. Morash, who has joined us. Good morning, Kerry.

I assume, Mr. Parker, that your officials are aware of the fact that we have sent to you a statement of witnesses that's read into the record if it is necessary. This statement basically outlines the rights and privileges of being in this Legislature as witnesses, and I have mentioned it to you earlier so there is no need to read it into the record. Is that correct?

MR. PARKER: No, I don't believe there is any need to read it into the record. We received the witness statements. If I could take the opportunity, I would also like to mention that we have another gentleman who will be joining us. He is en route from Sydney, Mr. Robert Sampson, who assisted us during our difficulties last fall and he was our independent legal counsel. So he will be joining us here shortly, I hope.

MR. CHAIRMAN: That's great. Thank you. The usual protocol is that we allow our witnesses, as a group, to make a presentation into the 12 minute range. I caution you, Mr. Parker, that I used to be a school principal so I am going to make you stick to that. The most important part of this session, you will find, is the exchange of the questions and the answers, and I encourage you to stick to the guidelines. It is 8:06 a.m. If your group could begin its presentation it would be appreciated.

MR. PARKER: Thank you. I will ask Mr. Miller to lead off.

MR. MILLER: Mr. Chairman, distinguished committee members, thank you for the opportunity to spend time with you early this morning to discuss issues regarding teaching and learning in the Chignecto-Central Regional School Board. I am proud to be the Superintendent of CCRSB. Ours is a large board geographically. It is twice the size of Prince Edward Island. It is very similar in size to the State of Vermont. We have approximately 26,000 students; 17,000 of these are brought safely to school each day in 217 buses. We have

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91 schools with approximately 3.7 million square feet of building space. We employ close to 3,000 staff; 1,573 of whom are teachers. Our budget is slightly in excess of $136 million.

We were born of a shotgun marriage in 1996 but the board since then has ably distinguished itself in many positive ways since that birth. The learning communities in our view of Colchester, Cumberland, East Hants and Pictou Counties, have been beneficiaries of those achievements. I just would like to list two or three of those educational achievements.

The new board immediately committed itself to the principle of region-wide equity by sharing and expanding programs and services unique to the individual merging parts. Some examples: a full-day primary was assured for each elementary child, a region-wide, uniform staffing formula for allocating teachers and support personnel was almost immediately put in place, another formula for the distribution of resources, things such as library services and so on. We are particularly proud of the direction we have taken with our special needs programs, particularly those that provide service to children with severe learning disabilities and those with autism.

These actions were almost immediately followed by the implementation of a strategic plan for the board that embedded formally a commitment to equity. The board launched an aggressive program to expand throughout the region a hands-on, vocationally-oriented program called Occupational Preparatory, which is a homegrown program for our board and one of which we are very proud. We indulged in a lot of aggressive, thorough, professional development for teachers. We implemented a system-wide accountability program for all our staff.

The board has also attempted to address the key elements of the Black report, notably the recommendation to hire support workers for our African-Nova Scotian students and their unique learning needs. The board continues to support its adult learners with the opening of adult high schools throughout the region.

I guess, without being limited by those examples, I believe this board has indeed concentrated on the educational needs of all students and of all learners in fact, and it has solidly demonstrated its commitment to do so. As a backdrop to all of these achievements, the board has been the only school board in this province, since 1996, to consistently balance its books each and every year, and will do so again this fiscal year, which ends, as you know, at the end of this month.

This was not done by accident, but happened by design, by careful planning and because it was and remains the law to do so. The Auditor General, in his fiscal audit of our board in 2000, applauds the board for this achievement. The evidence, from my point of view, is clear that the board and its staff have indeed been careful custodians of the funds allocated for education by the government and people of this province. The finances since 1996 have been well managed but from time to time, even in the best-run organization, an anomaly may

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occur. It is the organization's capacity and determination to address that anomaly in a timely way that demonstrates its strength and its corporate courage.

In your invitation for us to appear today a number of topics are listed, Mr. Chairman, which would appear to centre on the anomaly to which I refer and, by extension, I believe to the board's response to that anomaly. Mr. Chairman, if I might, I would now like to ask our board chairman, Mr. Parker, to speak to that particular issue as part of these opening remarks.

MR. CHAIRMAN: Mr. Parker.

MR. PARKER: Good morning. I hope you'll allow me a little bit of leeway on that time. As a former principal I'm going to do the best I can, but I don't want to read too fast here.

MR. CHAIRMAN: Take your time.

MR. PARKER: Again, good morning. On behalf of all members of the Chignecto- Central Regional School Board I want to thank this committee for the opportunity to present facts to you today which will reflect the very serious responsibility of being a school board member, as well as the high regard of all board members to be accountable for the expenditure of public tax dollars.

When the Chignecto-Central Regional School Board was formed in 1996 by unwilling partners, we were a very large 31 member group with very different histories and philosophies. Everybody was very protective of his/her former board area and very suspicious of those other guys. Through a lot of hard work and a lot of give-and-take, our board has grown into, and I may be slightly biased here, the best school board in this province. While each board member will fight tenaciously for the schools in the area they represent, we have managed to overcome our differences and put our collective energies into good decision making and creative thinking to the benefit of all our students.

Our board is a heterogeneous lot, consisting of 17 board members, elected on a four-year term. Included are hairdressers, loggers, optometrists, ministers, truck drivers, engineers, homemakers, retired school teachers, farmers, general-store owners and more. Our board members are very busy, often with seven to eight meetings per month. Remember, this is for part-time board members who work all day and gather in the evenings for tough three to four hour sessions, often followed by a one to three hour drive home through all kinds of different conditions, and back to work the next morning.

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I cite these facts to let you know that we are a collective group of representative people who come together for one reason only, to improve the educational opportunities for all of our children, to allow them the best education possible with the limited dollars available. We are always dealing with cuts in real funding, and always trying to make due with less than what is really needed to do the job. As Mr. Miller has already mentioned, one thing our board is very proud of is the fact that we are the only board in this province that has balanced its budget consistently since our inception. Please remember that we are 17 lay people, not financial experts, not educational experts, but determined to get the best bang for the buck we can for our students and, at the same time, be accountable for every cent of taxpayer money, and to live within whatever means are dictated to us by the government of the day.

You can only imagine our collective sense of betrayal, disappointment, anger and disillusionment that we felt last September when two of our top administrators where alleged to have usurped the board's governance role by spending a large sum of money without board approval. These revelations first emerged when the vice-chairman and myself were working with our legal advisor to develop a contract for Mr. Miller. The plan was that Mr. Miller was to take over the superintendent's job in December when Mr. Elmer MacDonald, having been the first and only top administrator of the job since the board was formed.

Our first concern focused on payments to senior staff in lieu of vacation time that was not taken. Upon further investigation it became evident that this in lieu of payment was being added to pensionable earnings and that Mr. MacDonald's $24,000 a year travel allowance was being placed under pensionable earnings. We also learned of a contract signed by Mr. MacDonald for Mr. Robert Renouf, the CFO of the board, which board members and our legal counsel had no knowledge of.

[8:15 a.m.]

At this point we felt there was reasonable cause to believe that something was wrong. Our instincts were to inform the board immediately, but we were warned by our legal counsel that due process and procedural fairness were important and we could smear the reputation of two well-respected, both locally and provincially, long-time employees. We were advised to employ independent legal counsel so as to avoid even the perception of preferential treatment because of a long-time association between our legal counsel and the two individuals.

Mr. Robert Sampson, who has just joined us here from the law firm Sampson McDougall in Sydney, was contracted to do that investigation. Mr. Sampson's preliminary investigation was completed in one week, following which the full board was informed and an investigative team of four senior board members was formed to work with Mr. Sampson on a formal investigation. The board gave Mr. MacDonald and Mr. Renouf leave with pay while the investigation was carried out.

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In-depth interviews were held allowing both Mr. MacDonald and Mr. Renouf to answer to all allegations. Interviews were held with other senior staff to see if the matter went deeper, and it was determined that it did not. The investigation showed that $1.7 million had been authorized for expenditure for capital items within our board by Mr. MacDonald with the full knowledge of Mr. Renouf in early July 2001. This, combined with earlier revelations of administrative error in the placement of income, incorrectly, into pensionable earnings and a contract unknown to the board caused there to be a total loss of trust in our two top administrators.

The board's investigative committee, with the advice and support of Mr. Sampson, recommended to the board in mid-October that Mr. Renouf be provided the option to resign, and Mr. MacDonald likewise, after completing a 30-day disciplinary suspension without pay. This recommendation was accepted unanimously by the board and Mr. Gary Miller officially became the new superintendent on October 15, 2001. Mr. Sampson completed his investigation and presented it to the board. He found no evidence of any criminal wrongdoing, but rather a gross disregard for the lines of authority, which they knew or ought to have known existed.

As a board made up of a cross-section of citizens with varying backgrounds and abilities, we make the best decisions we can based on the figures given to us by our senior administrators. The system relies on trust, and while we ask deep and probing questions, we have to trust the data given to us. We cannot and should not have to be in the offices watching every move. That is not our role. We do, however, jealously guard our responsibility under the Education Act as a governance body to approve expenditure of dollars in our education system. When anyone tries to take over our responsibility, we must take all measures necessary to correct the situation quickly.

Upon completion of Mr. Sampson's investigation and the board's subsequent disciplinary action, full disclosure was made to the Minister of Education and our public. A thorough investigation was done by the minister's tri-department committee, Education, Justice and Finance, and no fault was found in how our board had dealt with the situation. We had found the problem, investigated swiftly, fairly and completely, in a minimum of time and with complete public disclosure. Most important of all, our board had completed the process with minimum disruption at the school level and never lost sight of our reason for being - to make education work for all of our students and to be accountable for every last cent of taxpayers' dollars.

One of the main recommendations of Mr. Sampson's report was to contract the firm Grant Thornton, under the leadership of the well-respected Glenn Williams, to do a study of past audit procedures. The firm was to study the financial governance system and the financial reporting systems of the board. This work is still ongoing and is certain to be of much help to the board in setting up structures and checks and balances to hopefully prevent a reoccurrence of last fall's tragic events.

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In the end, though, we must always remember that no matter how high we put the fences, if individuals choose to go around them, they will. It is our job as a board to put the fences in place, watch as closely as a part-time board can, and to act quicky and decisively if anyone breaches the trust that our governance system so much depends on. I will turn it over to Mr. Miller to finish up.

MR. MILLER: Just one more minute, Mr. Chairman.

MR. CHAIRMAN: You're doing great, Mr. Miller. Thank you for sticking to the timeline.

MR. MILLER: As the board's new superintendent, Mr. Chairman, and with the lessons learned from our experience, I would now very much like to be able to move forward with the board's mission. It is time to turn our attention, full-time, to the needs of students and teachers, to learning and to teaching. My priorities and support of both will centre on excellence in all we do, in our staffing, in our facilities, in professional development, in our race relations initiatives, in our accountability mechanisms within the board, and in our internal and external communications. I will expect that our budgetary process, in its development in how we report out to the board and its internal and external auditing features will be transparent, it will be open and it will be understandable.

CCRSB has the capacity to do all of this. We have a board committed to good governance. We have a loyal and exceptionally talented workforce. We have support of communities, we have good schools and, most importantly, we have thousands and thousands of young people ready to learn. We are ready to move forward.

Mr. Chairman, in closing, I would like to say we are ready to move forward. I would also ask at this time, and we would appreciate, if our Chairman, Mr. Parker, could have some opportunity at the end of our session here together to provide some closing remarks for the committee.

MR. CHAIRMAN: Thank you for those comments and, yes, Mr. Miller, I am remiss in not making it public but I did mention to Mr. Parker that there is an opportunity at the end for some concluding comments by all members present or, as you requested, by the chairman. It is 8:22 a.m. and I will turn the next 20 minutes over to the member for Halifax Fairview.

MR. GRAHAM STEELE: Thank you, Mr. Chairman. I don't think there is any question that the Chignecto-Central Regional School Board does excellent work, under difficult circumstances because of the area you are covering, the number of students you have, the number of schools you have. In fact, it is quite remarkable what has been done in the last five or six years. In fact, I would even go further than that and say that I don't think anybody would disagree that Mr. MacDonald and Mr. Renouf were excellent administrators. They were good administrators which is why, I think, the sense of betrayal, is the word used - Mr.

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Parker, is heightened. The fact that they did what they did should not obscure the fact that they did a lot of good work at your board.

It is the nature of this committee that we don't focus on all the good things that are done. We focus on the exceptions, the problems. This is kind of a backward-looking committee. We look at how public money was used and spent, or misused and misspent. So, although I very much take the point that you make, Mr. Miller, about all the good things that are being done and about moving forward, I am going to focus today on the difficulties that you went through last fall.

It is my understanding that there are essentially four problems with what happened. There was the personal services contract negotiated with the chief financial officer that was never disclosed to the board. There were the cash payments to senior management paid in lieu of vacation. There were the inflated reports of pensionable earnings and, in particular, with respect to Mr. MacDonald, including the $24,000 a year automatic travel allowance which, as Mr. Parker says in one of his letters, really is just a thinly-disguised salary supplement called a travel allowance. Finally, there is the $1.7 million in spending that somehow came to be spent in the discretion of those two senior administrators.

I would like to start by talking about Mr. MacDonald's employment contract, which seems to be at the root of at least two of those four problems that we identified. Mr. Parker, the committee members have been given a letter dated November 28th, that you wrote to the Minister of Education which, I think, summarizes reasonably well what the issues are around that contract. I wonder if you could explain, to the best of your knowledge, when and by whom Mr. MacDonald's employment contract was negotiated.

MR. PARKER: Mr. MacDonald's employment contract?

MR. STEELE: That's correct, yes.

MR. PARKER: At the time, when the boards were brought together in 1996, the province had set up local amalgamation committees and hired individuals to work with those committees. In the case of Mr. MacDonald's contract, it was Mr. George Unsworth who was the man who worked with the local amalgamation committee. So he developed the contract in concert with the local amalgamation committee, I believe, at that time. I wasn't involved with it, but Mr. MacDonald's contract would have been developed, certainly, under very close, at that time, provincial control because these new boards were being set up and that process was being closely guided by the province.

MR. STEELE: Mr. Parker, have you ever received a reply from the minister to your letter of November 28th?

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MR. PARKER: November 28th? I would have to go back through the papers here. That is the one to do with the employment contract. I don't believe that we received a reply from the minister. Could you help me on that, Gary?

MR. MILLER: No.

MR. PARKER: No, I don't believe we did.

MR. STEELE: It is a five and a half page letter. If I could summarize it, five and a half pages in one sentence, you express a great deal of frustration that the minister and her department seem to be blaming the school board for things that had their origin, their genesis, in a period that was controlled by the department, namely the amalgamation period.

The reason I was wondering if you had ever had a reply is that you asked some questions in this letter which I am very interested in knowing what the answers are. One of the questions you ask - or first you state that, at the time, Elmer MacDonald's contract required the approval of the then Minister of Education, and then you asked the question, was that approval in fact provided? Have you ever received an answer to that question?

MR. PARKER: As I said before, I don't believe we received anything back on that letter, but it was certainly done very closely in concert with the province. They had put out a template in 1996 for the coordinators to work from in order to develop contracts for the new superintendents in all of these new amalgamated school boards.

The minister would certainly have approved that if it was being done by an employee, somebody who was hired by the provincial government to work with and they had a large part in - certainly we had members from each of the former boards on that local amalgamation committee. Certainly the contract itself was developed by the coordinator with input from the board members, but it was provincially controlled.

MR. STEELE: The next question you ask in your letter is, "Who was the author of the excessively generous travel allowance, which effectively bypassed the restrictions of the recommended salary grid?" Have you ever received an answer to that question?

MR. PARKER: No, we haven't received answers to those questions, not to the best of my knowledge, anyway, Mr. Steele. We haven't received any answers back on them.

MR. STEELE: Your next question, "Why did your Department not intervene and object to this camouflaged salary enhancement that has caused our Board's reputation such harm in the eyes of our stakeholders?" Have you ever received an answer to that question?

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MR. PARKER: No answers received. Again, that was given at that time - when we developed Mr. Miller's contract back in October, we certainly tightened that up a lot because we were in control this time. The board was in control of setting the contract and - there was no provincial input whatsoever. We developed it and it mirrors the template for 1996 exactly, much more so and with much more advantage to the board than the one developed with provincial input in 1996.

MR. STEELE: There is also a reference in your letter to Section 65 of the Education Act, which requires the school boards to report to the minister on the salary and expenses of administrators and staff. Yet your letter refers to the fact that apparently the Department of Education never actually collected these figures, or if they received the reports they didn't file them anywhere. So that, in fact, when this whole thing happened last fall, the minister was unable to determine what the salary and expenses were of any administrator anywhere in the province. Could you elaborate a little bit on your understanding of how that came to be?

[8:30 a.m.]

MR. PARKER: Well, certainly, one of the difficulties we had when both the vice-chairman and myself were assigned the task of developing a contract, along with our legal counsel, for Mr. Miller - the first thing we wanted to do was we wanted to be as fair to Mr. Miller as we could be but also fair to the board and make best use of our dollars. So the first question we had was, how are other superintendents across this province being paid and what benefits and whatnot? In trying to find out that information, we went to the department and the answers weren't forthcoming, in fact they were very scattered and really not a lot to work with and we were told that they simply weren't on hand. We were disappointed by that, we thought that by going to the department we could get those figures, but they were not available, other than a brief sketch that somebody's making around this much or that much and it wasn't terribly helpful to us at that time. We had great difficulty getting - it seemed to be, I think I mentioned in that letter, sort of a secretive process. We thought it was the department's responsibility to have that on hand. We do file a lot of information with them, but that information wasn't available for us.

[8:30 a.m.]

MR. STEELE: I think, Mr. Chairman, when we get to the business part of the meeting I will be suggesting that officials from the Department of Education be brought in because it seems to me that they have a good deal to answer for in this whole issue, as well as the school board itself.

I would like to turn now to what I would really like to spend the rest of my limited time on and that is this $1.7 million in funding that ended up somehow being in the discretion of the superintendent. I wonder, we've received an explanation, Mr. Parker, in an in camera meeting from the Auditor General about how they believe that that came to be, that that much

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money was in the hands of a senior administrator. I wonder if you could explain to us, or if you'd like to refer this to anyone else who's with you here today, what is your understanding of the process by which the superintendent was able to give himself that much discretionary money?

MR. PARKER: I think I would turn that question to Mr. Marks, the chairman of our finance committee.

MR. CHAIRMAN: Mr. Marks. I remind the witnesses in the back row that you have to stand so we can pick you up for television reasons. Thank you, sir.

MR. MARKS: Can I then sit or do I have to remain standing?

MR. CHAIRMAN: The best part of speaking in this Legislature is that when you get on your feet your brain has to be in action. You have to remain standing for your complete answer.

MR. MARKS: Thank you very much, Mr. Chairman. The $1.7 million is a difficult thing to explain and I will attempt to do that. When we come towards the end of a year we have an estimation from senior management as to how much money we are either in arrears or in surplus. In this particular case we were told that we were going to have, at the end of that year, $200,000. In actual fact it was closer to $1.7 million. The board was not informed that this level of funding was available at the end of the year.

What happens with that $1.7 million, so that it doesn't show up when an audit is done, is that purchase orders are written against that $1.7 million for expenditures that will take place in the future. In this case, that's what appears to have been done.

Now, how does the $1.7 million then get freed up? Early in the spring, maybe it was June or July, the Department of Education indicated that they had and were willing to help us out with some of our capital expenditures. I am sure it's no secret that we have a lot of capital expenditures each year and we never receive enough money to do them all. In this particular case the Department of Education said we will supply, I believe it was $1.9 million in capital expenditures; because purchase orders had been written up for $1.7 million and because then we received $1.9 million, there was then $1.7 million freed up. When that's freed up - again, the board was not aware of that - it was at that time that the two senior managers decided to spend that money the way that they saw fit.

MR. STEELE: Thank you Mr. Marks. Mr. Chairman, how much time do I have left? I don't know what time I started.

MR. CHAIRMAN: You have seven minutes.

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MR. STEELE: Mr. Marks, it's my understanding, if I could elaborate a little bit on what you said, that purchase orders were written up and then when the funding came through from the Department of Education the purchase orders were then cancelled and that is how the money was freed up, as it were. We're also informed by the Auditor General that this was not contrary to the accounting rules governing school boards, that this was, in fact, in keeping with the guidelines followed by school boards, although not now in keeping with Generally Accepted Accounting Principles, it is in keeping with the guidelines followed by the school boards. If that's the case, then the real issue seems to be that it simply wasn't reported to the members of the school board and it very definitely should have been.

My question to you now is that it's - well, I have two questions. Let me ask the simpler one first. Mr. MacDonald was a superintendent of this school board for almost six years. What guarantees do we have that this same procedure didn't happen in previous years and not just in 2001?

MR. MARKS: I am not sure that we have any guarantees. There's one thing I think you should be aware of. When exceptional monies are spent within the school board, because of the lack of funding that we have, everyone knows. I would suggest that if there were funds that were spent within schools that were not approved by the board, the board members would have become aware of it.

MR. STEELE: Thank you. I am going to go back to Mr. Parker. Mr. Parker, I do want to emphasize that if you feel it's appropriate to throw the question to somebody else, please feel free. The Premier does it all the time in Question Period so you should feel free to do the same.

What has been done in your school board to make sure that this same procedure of writing up and then cancelling purchase orders, thus freeing up all this discretionary money of which the board is not aware - what guarantee do we have that that will not happen again?

MR. PARKER: Well, the issuing of the purchase orders - it's no longer going to be possible to do that under new provincial guidelines or regulations after this year. This is the final year that purchase orders can be used. I might say the purchase orders have been used widely across this province. As you say, it was an accepted method of - those dollars were - if we had, as Mr. Marks said, $200,000 left at the end of the year and we have to run a certain amount over or we will have a calamity in March - we're in trouble; we're coming back to the government saying we're in deficit. So wise budgeting practices are to try to carry some ahead. At the end of the year you have $200,000, $300,000, $400,000; if we knew we had certain purchases to make coming into the next year, whether they be for fuel or whatever, that money would be put ahead to do that. We're still going to have to carry a certain amount of dollars or else we are going to run into deficit situations, but it'll have to go in a reserve or whatever rather than into purchase orders. As of the end of this March, very soon, there will be no more purchase orders so we won't be able to do that.

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As of today, the door is closed for this year's POs, so that's the simple answer, that it's not going to be allowed to be done. Although it was a practice that was allowed, as you alluded to. In fact, I was told that the financial handbook that school boards go by is a 1987 handbook from the province. That's how far back we're going here without any new handbook. I think it was revised once, in 1988, so the board was operating under what the rules were.

In terms of the board not being told, we were always told how much we had to put forward into POs. The problem here came when we weren't told, as Mr. Marks said, that there was $1.9 million or $1.7 million. We were simply told there was $200,000.

MR. STEELE: Let me talk a little bit about how this $1.7 million was distributed. From reading the material I gather there was something called the wish list or, actually, the wishbook list. The superintendent would send an e-mail around to senior administrators and the board saying - well, I haven't seen those e-mails so I will paraphrase - something to the effect of that it's wishbook list time again, you tell me what it is that you want on the wishbook list. Is that your understanding as well, Mr. Parker, that it was only senior administrators who were asked for input into the wishbook list?

MR. PARKER: The wishbook list, as you call it, and it was something similar to that name, was sent out to the family of school supervisors, of which we have five families of schools, in early July, saying, look, give us a list of things you wouldn't get under normal budget procedures, under normal budget practices. Send the list in and make it complete, anything you might want. That wasn't clear to one particular area, and the message didn't go clearly to one of the senior people in the families. Therefore, that list didn't come back as complete as the other ones. The only other person who got a list or an invitation to put in a list was our assistant superintendent of operations, for anything that might need to be done in the operations way of the board that wouldn't be available, again, under normal budget practices. So there was one other person other than the family of school supervisors.

MR. CHAIRMAN: You're under a minute, Mr. Steele.

MR. STEELE: Did Mr. Sampson or did anyone else in the school board investigate whether anybody else was asked to add items to the wishbook list, or are you certain that it was only those five supervisors plus the assistant superintendent of operations?

MR. PARKER: That investigation was certainly done, and I might turn that over to Robert Sampson to answer because he was in charge of the investigation for us as to whether there was anybody else invited. I believe not, but I would check with Mr. Sampson.

MR. CHAIRMAN: Mr. Sampson. Good morning.

[Page 15]

MR. ROBERT SAMPSON: Mr. Chairman, good morning. I had personally interviewed, in fact I think Mr. MacIntosh may have joined me for a number of the interviews as the investigation rolled on, but we had personally interviewed all of the members of senior management as a group and individually. Questions similar to what you're asking were advanced to them, but the scope of the inquiry only included senior administrators, together with some representatives of the finance department who worked under Mr. Renouf, as well as, the chairman had alluded to, the committee that was appointed by the board to assist me; there were four of those, and they also participated in some of those interviews as well.

Frankly, the thought to go beyond senior administration, the practice, from my understanding, was never that anyone other than senior administration, some or all, were the ones who had any control over any budget items in terms of administering budget items. So, for example, someone below these administrators would be a principal and, to my knowledge, when we reviewed the expenditures that were made and tied them into the actual money spent, it all conformed to responses to these wishlists and there were no expenditures outside of the box, if you will, there was no principal of a particular school who had been singled out and given an opportunity to go to Mr. MacDonald and say, look, if you've got this big pot of money can I have some for my school too. There was absolutely no evidence of that and, as a result, there didn't appear to be a need to drop down below the chain of senior management, which would have been a chain of principals, because there was no evidence of that.

MR. CHAIRMAN: The next 20 minutes goes to the Liberal caucus.

The honourable member for Cape Breton West. It's 8:44 a.m.

MR. RUSSELL MACKINNON: Mr. Chairman, my first question is to Mr. Marks. I believe the issue of being open and accountable was made in reference to the board and the fact that the contracts for Mr. MacDonald and Mr. Renouf were in keeping with the provincial guidelines, is that correct?

MR. CHAIRMAN: Mr. Marks.

MR. MACKINNON: Just a simple yes or no.

MR. MARKS: Yes.

MR. MACKINNON: I notice where, according to Mr. Robert Sampson's report, Mr. Renouf drafted his own contract without the knowledge or approval of the board, is that correct?

MR. MARKS: Yes.

[Page 16]

MR. MACKINNON: Is the board in a position to indicate how much the activities of Mr. Elmer MacDonald and Mr. Robert Renouf cost the board and how much they were ordered to pay back to the board?

[8:45 a.m.]

MR. MARKS: I believe the total cost to the board thus far is in the vicinity of $100,000.

MR. MACKINNON: Is that just with regard to their salaries and travel?

MR. MARKS: No, this has to do with our legal fees related to the events that occurred and our looking into those events. It has nothing to do with, or related to, what those individuals were paid.

MR. MACKINNON: My understanding, according to Robert Sampson's report, is that they were ordered to reimburse the board.

MR. MARKS: And that is being done.

MR. MACKINNON: Is there any indication as to how much they will be ordered to repay the board?

MR. MARKS: I would turn that over to our solicitor because he's actually been doing those negotiations.

MR. CHAIRMAN: Mr. MacIntosh.

MR. MACINTOSH: Mr. Renouf has been resolved; when the pluses and minuses were added up, I think it ended up that the board owed him a nominal sum, literally nominal. I forget it. Actually I meant to look it up. It was under $10.

MR. MARKS: Twenty-three.

MR. MACINTOSH: Twenty-three dollars, I'm sorry. When we did the pluses and minuses with Mr. MacDonald, it was somewhere in the range of - it was slightly over $30,000, I guess, and that is in the process of being collected back from Mr. MacDonald.

MR. MACKINNON: So the $100,000 that you referred to is for the Robert Sampson report, the Grant Thornton audit and so on. Is this the first time you've had an external audit of the board since its inception?

[Page 17]

MR. MACINTOSH: Mr. Chairman, Grant Thornton did not do an external audit. They had two assignments. Number one was to look at the governance role in terms of how the board could better set up its various practices to adopt best practices, including particular emphasis on an audit committee and the roles that can play. The second function they examined was the actual audit that was done last year to make sure that it was in accordance with generally accepted auditing standards and how the board can do it better in the future, and that cost.

MR. MACKINNON: And who did that audit?

MR. MACINTOSH: That was Grant Thornton.

MR. MACKINNON: So Grant Thornton did two audits.

MR. MACINTOSH: No, they had two assignments.

MR. MACKINNON: Who did the first audit?

MR. MACINTOSH: The word audit, Mr. Chairman, I'm just a little bit uncomfortable with that. The way accountants use the word audit, it means going back through the books and examining them. They did not do that. What they did was review procedures, both with respect to decision making and with respect to what the board's auditors, KPMG, did last year and have been doing, to make sure that when a school board retains an outside auditing firm like KPMG, the scope of that audit is sufficient to protect the board. They are coming back to us with recommendations as to how to do that better. They did not audit the books of the school board.

MR. MACKINNON: Mr. Parker, are the books audited every year?

MR. PARKER: Yes, the books are audited every year, and the company has been KPMG since the board's inception, I believe.

MR. MACKINNON: Was the board able to determine how long this slush fund approach to certain activities that were portrayed by Mr. MacDonald and Mr. Renouf and referred to as the wish list - is this the first year that this was ever uncovered? Was the board not able to determine if this was done in the past?

MR. PARKER: We found no evidence that there had been a similar occurrence in the past. At various times schools will be asked for a wish list type of thing, but generally they became quite accustomed to the fact that they didn't get anything. You need to know what your schools need. Principals would then forward that to the family of schools supervisor; here's some of the things we need in our schools. They became quite accustomed to the fact that there was never any money left at the end of the budget year to get them. So this was the

[Page 18]

only one that we could find when we went back as to the fact that the board knew nothing about the money and the money was handed out in this way. There was no evidence that pointed to it having happened before in that way.

MR. MACKINNON: Did the board ever ask Mr. MacDonald or Mr. Renouf if this was done in the past?

MR. PARKER: I believe those questions were asked in the investigation. Certainly we asked a lot of questions of them and maybe, again, Mr. Sampson might remember better as to the specific questions, but I believe those questions were asked.

MR. CHAIRMAN: Mr. Sampson.

MR. SAMPSON: Mr. Chairman, absolutely. We had a series of meetings, and at the last session we had with each of these individuals we were in a much better position to ask more direct questions and the inquiries were made. Quite frankly, at the end of the day we never did receive, in my view, any rational explanation from either of them as to why the expenditures occurred without having gone back to the board in this instance and, in that context, they had indicated that it had not gone on in the past. In addition to that inquiries were made, and it is my understanding from discussions with other members of finance who assisted me that there was a significant spike-up in the use of the PO in this particular year that set itself apart from any other year that the record showed. So it appeared to be, from all indications, a one-off situation, based on those inquiries.

MR. MACKINNON: Mr. Parker, did the board submit its business plan for the 2002-03 fiscal year to the Department of Education?

MR. PARKER: I believe that business plan has been submitted.

MR. MACKINNON: Would you table that for members of the committee?

MR. PARKER: Do we have that with us, Mr. Miller, the business plan?

MR. CHAIRMAN: Mr. Miller.

MR. MILLER: Mr. Chairman, I don't have it with me here but it is in my hotel room and at the end of the session I would be quite happy to . . .

MR. MACKINNON: Has that business plan been shared with the MLAs who serve within the purview of the Chignecto-Central Regional School Board?

[Page 19]

MR. MILLER: At this point, Mr. Chairman, it has not. The business plan is really very much in a draft stage. Once we receive our budget figures and develop our budget, we must submit the plan to government within 30 days and then it would be finalized by the board and submitted, then it is certainly in the government's hands, but it is very much draft now. We were asked to submit a draft in December and we have received favourable comments on our draft, but you cannot complete your plan, in point of fact, until you actually know what your figures are and what your budget is.

MR. MACKINNON: Is this the first year that the board has submitted a business plan?

MR. MILLER: This is the first year, Mr. Chairman, that the board has been required to submit a business plan. In the past we have submitted annual reports, but this will be the first year for an actual business plan.

MR. CHAIRMAN: Just to clarify, Mr. Miller, you are prepared to share with this committee the draft that you have.

MR. MILLER: I have the draft and the Department of Education has the draft so if the members of your committee would like that, Mr. Chairman, I have it in my hotel room.

MR. CHAIRMAN: That will suffice, Mr. MacKinnon?

MR. MACKINNON: Yes.

MR. CHAIRMAN: Thank you. Mr. MacKinnon.

MR. MACKINNON: This so-called spike-up that Mr. Sampson referred to, were there any schools within your district closed during that particular fiscal year?

MR. CHAIRMAN: That question is to?

MR. MACKINNON: Mr. Parker.

MR. CHAIRMAN: Mr. Parker.

MR. PARKER: Any schools closed? The only school is the small East River St. Mary's School in the far eastern end of Pictou County that is on temporary closure and the board is still considering permanent closure of that school.

MR. MACKINNON: How much money did the board save by closing that school?

[Page 20]

MR. PARKER: I don't know if I could give a figure right off. It required one staff member, I believe there were only three, four or five students there, so one staff member plus we are still heating and maintaining that school at the present time because it is only temporarily closed. So probably if you took a staff salary and whatever other associated costs would be there, probably in the range of - oh boy, I'd be guessing, a teacher's salary plus the maintenance, $75,000 to $100,000, I suppose would be the saving.

MR. MACKINNON: Are you guessing or is there some detail that the board would provide to show substantively how you would rationalize closing that school?

MR. PARKER: Well, certainly there is a lot of detail on that because a closure study has been done, I believe, twice now and all of the detail is available. We can make that available.

MR. MACKINNON: Mr. Parker, is there anybody of the witnesses here who would be able to give us something a little more substantive other than generalities, on that.

MR. PARKER: I don't believe that we probably came prepared for that school closure. I didn't bring the school closure report with me. I don't believe we have anybody here today - we don't have our Assistant Superintendent of Operations with us, who is the person in charge of that part of the board as far as administration goes. He could give you the more detailed figures, but certainly they are available.

MR. MACKINNON: Well, I am a little disappointed because here we are talking about - you came here and you indicated that this is an open and accountable board, ready to disclose any and all. During this critical period where the issue of an expenditure of, what, $1.7 million without going through proper process - in the hands of two individuals who held a considerable amount of authority, power, and discretion on decision-making, policy direction, curriculum and whether schools would be closed or not. No one is able to tell me how much the board, in this particular year, would save as a result of that school closure. To me, it would seem rather straightforward. Other than yourself, Mr. Parker, is there anyone else in your Finance Division who can answer that question?

MR. MACINTOSH: Mr. Chairman.

MR. CHAIRMAN: Yes, Mr. MacIntosh, would you like to reply?

MR. MACINTOSH: Not to the question but on a point of privilege or whatever would be the proper description in this House.

Mr. Chairman, this is the type of thing we specifically requested. With due respect to Mr. MacKinnon, when he suggests that this board is prepared to come here and be ready and willing to disclose any and all, within reasonable parameters, I think that is a fair statement.

[Page 21]

But we had asked to be provided notice of those issues. Now, for example, if we had known that members wanted information with respect to that particular school, I am sure it could have been done.

Please understand that the school board - I believe it has somewhere in excess of 8,000 or 10,000 types of accounts within its financial records. It is $136 million. To suggest that the chairman is not forthcoming, open or accountable this morning because we don't have those figures at our fingertips I suggest is not fair to the chairman and not what this process is for.

MR. MACKINNON: Well, Mr. Chairman, at no point in time did I suggest that the chairman was deliberately misleading this committee. For Mr. MacIntosh to strut his feathers in legal form I think is inappropriate before this committee. He has been before this committee several times and for him to get agitated - both Mr. MacDonald and Mr. Renouf were invited to appear before this committee as well and refused even to respond. Am I correct on that? Yes. They didn't even respond.

MR. CHAIRMAN: Mr. MacKinnon, order please. Perhaps I could clarify this. Mr. Parker, are you prepared to submit to the committee the specifics of what this closure - and I apologize if I have it incorrect - the St. Mary's East. . .

MR. MACINTOSH: East River St. Mary's.

MR. CHAIRMAN: East River School. Are you prepared to submit to us what the savings would be when you return to your board and those figures are available?

MR. PARKER: Certainly more than prepared to do that. The study has been done again this year because the board will be dealing with the permanent closure of that school, but we also have last year's. This is the third closure study that has been done, so we have those figures available. We didn't come prepared for that line of questioning so we don't have them here, but it is certainly no problem to provide them to the committee.

MR. CHAIRMAN: Thank you. I recognize Mr. MacKinnon. You have five minutes remaining.

MR. MACKINNON: Thank you, Mr. Chairman. Quite simply, what could be evolving here is senior officials within the Chignecto-Central Regional School Board intentionally inflating the cost of keeping the school open to make it easier to close the school. If we have senior officials that the elected officials are depending on for counsel, and we have clear evidence of that mistrust or that breach of trust, how are we to have any confidence in the fact that that was a legitimate school closure? I think that is a reasonable and fair question, given the fact that Mr. MacDonald and Mr. Renouf were not only invited here but they were the

[Page 22]

key persons in that financial management. It begs one to wonder how much detail the elected officials are getting, and if they are getting it why aren't they doing due diligence?

[9:00 a.m.]

MR. PARKER: In answer to that, I guess first of all I would like to say that Mr. Renouf and Mr. MacDonald's appearance or lack of appearance here is under no control of the board. They are no longer employees of the board so we don't take any responsibility for them not being here. We are here to do the best we can to answer the questions the members have.

Certainly, on a school closure, very detailed and official the way that those are done, according to provincial guidelines, and there is lots of public involvement in a school closure process. So there were certainly members of the community, members of the school system involved in that who very carefully scrutinized what the costs were and what the costs to students were of closing the school in terms of other factors. So I don't have any doubt in my mind that the facts were brought forward in this case, because there certainly was a very open and public handling of the issue, not only at the school board level but through the school closure process. It is very detailed, timelines that have to be met and the information that has to come in.

MR. MACKINNON: So you're asking us to trust you?

MR. PARKER: We're asking you to trust us as board members, yes, and we expect to trust the people who we have working for us. When that trust breaks down then we have a problem.

MR. MACKINNON: I noticed in the letter - how much time do I have, Mr. Chairman?

MR. CHAIRMAN: You have two minutes.

MR. MACKINNON: Your November 28, 2001 letter to Minister Purves, on Page 4, you refer to the salary of the new superintendent as being a significant reduction from Mr. MacDonald's previous salary. What is the present salary of the new superintendent and what was the previous salary?

MR. PARKER: As is stated in the letter, the present salary is $112,500 per annum and the previous salary was at $117,800.

MR. MACKINNON: So you would define that as a significant reduction?

[Page 23]

MR. PARKER: Plus there was $24,000, as I mentioned before, which was a thinly-veiled, brought in in 1996 - in addition to that, and we have significantly reduced that, so that the savings to our board, not only the $5,000 there - but probably in the range of somewhere between $15,000 and $20,000 would be the total saving. That is significant in our minds because it enables us to hire another couple of TAs or another part-time teacher.

MR. MACKINNON: But that is not what this statement says. What you state quite clearly is that the salary, $112,500 is significantly lower than $117,800. Isn't that correct?

MR. PARKER: That's right, and it is a reduction. Any dollars that we can gain is a significant reduction. It may not be in bigger terms, but it is on our board; any monies we can save are significant.

MR. MACKINNON: I guess my time has pretty well expired for now, Mr. Chairman. I guess that's the issue, what's relevant; and perception is reality. What you think is significant is insignificant when you look at the big picture and how taxpayers' dollars are being spent. You are expecting us to trust. . .

MR. CHAIRMAN: Thank you, Mr. MacKinnon. I would like to recognize the government caucus. I am aware of the fact that the member for Colchester North is leading off. Mr. Langille.

MR. WILLIAM LANGILLE: Thank you very much, Mr. Chairman. First of all I would like to congratulate Gary Miller, the new superintendent. I understand that morale has certainly improved since you have taken over. The Acting Director of Finance, Val Gauthier, I would like to address this question to you. I would like to know the cost, to date, that the board has incurred in regard to your solicitor, Bruce MacIntosh?

MS. VAL GAUTHIER: I will refer the question to our legal solicitor. I know, in totality, that our legal and professional fees are almost to the tune of $100,000 regarding all issues. However, as far as Mr. MacIntosh's fee, he is probably better able to answer that.

MR. CHAIRMAN: Thank you. Mr. MacIntosh.

MR. MACINTOSH: Mr. Chairman, I will pass the ball, given that it involves my expenses, and the committee was advised that this question would be asked. I believe Mr. Marks is prepared to address that question.

MR. CHAIRMAN: We will follow the bouncing ball to Mr. Marks.

MR. MARKS: Mr. Chairman, I am not sure, is the question directly related to, what have we paid for legal costs this year, or directly related to the issue related to the $1.7 million?

[Page 24]

MR. LANGILLE: No, nothing to do with the $1.7 million. It is, what have you paid to date, the Chignecto-Central Regional School Board paid to Mr. Bruce MacIntosh to date?

MR. MARKS: For this year?

MR. LANGILLE: No.

MR. MARKS: It's $30,000.

MR. LANGILLE: Not this year.

MR. MARKS: Oh, you mean over the. . .

MR. LANGILLE: To date, since he was hired, retained as solicitor?

MR. MARKS: In 1998, our expenditures were $195,427; in 1999, they were $176,250; in the year 2000, they were $50,872. During this period of time, the reason they are high at the beginning is we had negotiations where we brought various unions together and that's why our costs tend to be high in the first couple of years and then they tend to drop off.

MR. LANGILLE: Thank you very much. Mr. Miller, Chignecto-Central Regional School Board encompasses Pictou County, Colchester County, Cumberland County and East Hants. Is that correct?

MR. MILLER: That's correct.

MR. LANGILLE: There appears to be an inequity of representation for all the areas. In other words, all the power in the school board's offices were from Pictou County. I refer to Superintendent, Elmer MacDonald; Chief Financial Officer, Robert Renouf; Assistant Superintendent, Human Resources, Brian Murphy; elected chairman, Robert Parker; solicitor for the school board, Bruce MacIntosh. I ask you, what changes have been made as to personnel at head office since you assumed the role of superintendent?

MR. CHAIRMAN: Mr. Miller.

MR. MILLER: The changes, first and foremost, my own. May I ask, Mr. Chairman, in terms of the changes, whether the member would like me to indicate where we live?

MR. CHAIRMAN: I believe that's the intent. I heard some reference to geography, I don't know if you have that at your fingertips. Mr. Langille, would you clarify that?

[Page 25]

MR. LANGILLE: That was not my intention. My question was, what changes have you made at the school board head office since you assumed the role of superintendent, in regard to personnel.

MR. MILLER: With regard to senior personnel, since my tenure, Miss Gauthier, as you know, is acting CFO, so that's a major change, in addition to my own position. We have had one change in our planning, research and technology department, Miss Karen Casey has been replaced by Dr. Larry Elchuck. Other than that, our personnel, at the senior level - excuse me, one family of schools supervisor has changed, we now have Ms. Lynn MacLean, who is in that position. Other than that, the personnel have remained the same; the personnel.

MR. LANGILLE: Thank you, very much. Yesterday I received a letter written by Bruce MacIntosh, sent to Mora Stevens. I specifically refer to Page 2, fourth paragraph and I read:

"There have been attempts by certain MLA's in the recent past to address specific issues of hiring by the Board. CCRSB has an independent and objective selection process for hiring and specific discussion of specific individuals is not a subject matter which Dr. Murphy or others will be prepared to address at tomorrow's session. If requested, fulsome explanation will be provided of the Board's human resources hiring protocol, which the Board believes is a model to be followed by others."

Mr. Chairman, I would like to table this letter please. I would also at this time request for Mr. Bruce MacIntosh, if he will, to advise the Public Accounts Committee what his intent was when he wrote that letter. In other words, I would like the names of the MLAs and so on to which he refers at a later date, please, and I will continue.

The next question is for Mr. Brian Murphy. Did you hire Elmer MacDonald's niece, a part-time secretary at Sobeys, for $38,000 per year even though two union secretaries who were working at the school board applied, one with 16 years of experience and the other with 12 years of experience?

MR. CHAIRMAN: The question was directed to Mr. Murphy, but I recognize Mr. MacIntosh.

MR. MACINTOSH: Mr. Chairman, I think the board has made its position clear that we do not consider it appropriate and are not prepared today to talk about specific individuals or specific appointments. As I highlight in my letter - which, by the way, is on behalf of the board, it's not my personal opinion - I write on behalf of my client and it is the position of my client that this forum today, certainly without foreknowledge, if at all, is not the appropriate place to say why did you hire this person over that person. That's not fair to the individuals involved; it's not fair to Dr. Murphy, who will, presumably, have a file on those appointments.

[Page 26]

Certainly I can tell you that CCRSB wishes to be open and helpful to this committee to the extent that any of that information can help your review.

MR. CHAIRMAN: Mr. MacIntosh, thank you. Mr. Langille.

MR. LANGILLE: Further to this, was Cathy Brown, a sister-in-law to Robert Renouf, hired by you, Mr. Murphy?

MR. CHAIRMAN: Mr. MacIntosh?

MR. MACINTOSH: Again, if I may highlight, despite the fact that this House has immunity and that my clients can say anything in this House without fear of lawsuit, the Chignecto-Central Regional School Board and I would hope this House recognizes the concept of fairness. With respect, the board has something in excess of 3,000 employees. We are not going to respond to specific allegations that have insinuations which suggest impropriety. If there is any suggestion of impropriety in our hiring practice, I am sure Dr. Murphy will be pleased to respond to it.

MR. CHAIRMAN: I would just like to point out to members present that in the statement that is sent out in advance and sometimes read into the record, it does say quite clearly that - this is addressed to the witnesses, and I am sorry I am taking some of your time, Mr. Langille, but I can make it up to you - you're bound to answer all questions that this committee sees fit to put to you. If you are unwilling to answer a question, you may, after stating the reason for desiring to be excused from answering, appeal to me as the chairman as to whether, in the circumstances and for the reason stated, an answer should be given. So you are within, as you are aware, Mr. MacIntosh, the purview of this committee and I understand your answer.

I will give you back another 30 seconds on that, Mr. Langille, and I apologize.

MR. LANGILLE: Thank you very much. I also would like to know if Elmer MacDonald's secretary, Linda Campbell, received a yearly bonus and for what reason? If you're not prepared to answer that, I would like to go on.

MR. CHAIRMAN: Mr. MacIntosh? Or whoever that's directed to? Mr. Murphy? Mr. MacIntosh? Yes, Mr. Murphy, thank you.

DR. MURPHY: Thank you. To my knowledge, there is no bonus in relation to the files that we maintain on any of our personnel. With specifics to the person you've requested information on, if there is a bonus circumstance there and this may be, to my recollection would be - the only information I am aware of would be that in fact she received mileage for delivering mail, but other than that I'm not aware of any bonus.

[Page 27]

[9:15 a.m.]

MR. CHAIRMAN: Thank you, Mr. Murphy. Back to Mr. Langille. You have 10 minutes left.

MR. LANGILLE: I'll go on. I'm sure you've heard of corporation ethics. I understand that the Chignecto-Central Regional School Board has the highest number of term teachers of any board in the province. Would you agree with that statement, Mr. Miller?

MR. MILLER: Mr. Chairman, I would like to refer that to Dr. Murphy.

DR. MURPHY: I'd ask for clarification; I didn't hear. The highest number of what?

MR. LANGILLE: Term teachers in the province of any board.

DR. MURPHY: I'm not in a position to answer that. I don't know the numbers of term teachers in the other boards, but certainly the term status contract established with our board is in direct response to the provincial agreement for the Nova Scotia Teachers Union.

MR. LANGILLE: That could certainly be challenged. Exactly how many term teachers do you have in your board?

DR. MURPHY: The number of term teachers varies on an annual basis, based on the number of teachers we would have on leave, the number of teachers who are on sick leave, the number of teachers who choose deferred salary, the number of teachers who . . .

MR. LANGILLE: That's not what I asked you. I asked you for a specific number. How many term teachers do you have? Do you know the answer, yes or no?

DR. MURPHY: I know the answer. I have the information available and I will provide it for any year in the last six that we've been in operation, but I do not have those numbers with me on my desk.

MR. LANGILLE: Would you get back to the Public Accounts Committee with those numbers, please?

DR. MURPHY: Certainly.

MR. LANGILLE: Is the reason there are so many teachers at 30 per cent to 70 per cent less money so that the board can balance its budget, or is it because the Chignecto-Central Regional School Board, like other boards, doesn't follow union contracts, or is it because needless, large amounts of money are being spent on renovations to school board offices?

[Page 28]

MR. CHAIRMAN: Mr. Langille, to whom are you directing that question?

MR. LANGILLE: I'll direct that to Mr. Miller. It might be a loaded question.

MR. MILLER: Mr. Chairman, I find the premise of the question very hard to deal with. I really would have no comment, Mr. Langille, on that.

MR. LANGILLE: I have to pass on to my colleagues, but just a quick summation. Mr. Parker, under the Conservative Government - since it formed power in 1999, has it ever cut funding to your board or has it increased funding each year?

MR. PARKER: In real dollars, we've been cut. In actual dollars, we haven't. In real dollars, we have been cut.

MR. LANGILLE: I understand actual dollars. I don't know exactly what you mean by real dollars, but that's fine. Thank you very much for that answer.

MR. CHAIRMAN: The honourable member for the beautiful - that's how we have to say it - Colchester-Musquodoboit Valley.

MR. TAYLOR: Mr. Chairman, I'd like to thank the delegation from the board for coming in this morning. I have a number of concerns. I guess I'd like to start by saying that a number of taxpayers, in Colchester-Musquodoboit Valley especially, have expressed concern - and I'm not saying it's well-founded; perhaps you can tell me it isn't - that the Chignecto-Central Regional School Board has done some empire building and there are different fiefdoms that have been fortified and protected.

One of the concerns I have is that based on information on administrative staff in the current Department of Education's directory of schools and the department's school statistics, the CCRSB has one of the largest numbers of board administrators per student, board administrators per school and board administrators per teacher. In fact, the directory, which I can table - at least an insert from the directory, Mr. Chairman - of schools indicates that the board has as many administrative staff as the Halifax Regional School Board, but yet has half as many students.

I'm a little bit concerned about these family offices, Mr. Chairman, a number of people are. The Chignecto-Central Regional School Board has family offices, literally, all over the place. We have the Celtic family office in Pictou, the Chignecto family school office in Springhill, the Cobequid family of schools in Brookfield, the Northumberland family of schools in River John, the Nova family of schools - it says here Shubenacadie office, but Mr. Chairman, they recently moved from the Milford school, I understand, to the previously condemned, environmentally unsound Elmsdale District Elementary School - plus we have the Central office in Truro.

[Page 29]

I guess what I'd like to know is - and I understand further, Mr. Chairman, that each of these family offices has an assistant superintendent, a superintendent; of human resources, an operations manager; a planning, research and technology individual; a student services coordinator and a French coordinator, apparently, at 0.5 at each of these family offices. I'm a little bit curious as to how the board can reconcile and justify having these family offices hither and yon, all over their jurisdiction and can some of this not be rationalized, surely to goodness?

Mr. Chairman, I don't know who the question should be directed to, but I would like some information on this concern that the taxpayers out there have.

MR. CHAIRMAN: I would ask the member for Colchester-Musquodoboit Valley to table that document . . .

MR. TAYLOR: Yes.

MR. CHAIRMAN: . . . for comparative reasons, for my own personal interest, if you wouldn't mind. I will recognize Mr. Parker to answer these questions or comments.

MR. PARKER: There's a lot of information that is not correct there, and I would like to correct some of that for the committee members here. First of all I would like to go back in history a little bit, because we did talk, in our opening comments, about the formation of this board in 1996, very unwilling partners because each area very much wanted to keep control of their schools in their area, whether it be in Pictou, Colchester, East Hants or Cumberland. It was a very conscious decision at the time of amalgamation that in order to give a presence in the various areas so that we didn't appear to be a very centralized system in Truro, all decisions being made in Truro, and that was a concern, that we would have sub-offices out in the various areas that were formerly board areas, certainly one in Pictou, in the former Westville Road office, certainly one up in the Cumberland area - they feel very much left out a lot of the time, so we very much wanted to have one there - down in the East Hants area.

We set up five families. Those were collections of schools that could have their own area, so that teachers could go in, parents could go in, have disciplinary hearings held and whatnot. Not everybody wanted to travel all the way to Truro. Yes, we gave up some to have that decentralized system, but it's been well accepted. There may be some people who don't like it, but it's been well accepted across this board.

As far as the information as to how much staff is in each one of those, there are no assistant superintendents of operations, of human resources, or any of those. They are all based in Truro, the assistant superintendents. What is in the family of schools office is the family of schools office supervisor, then there are secretaries . . .

[Page 30]

MR. TAYLOR: A business manager?

MR. PARKER: There's a business manager to help . . .

MR. TAYLOR: Program coordinator?

MR. PARKER: Program coordinator, but no assistant superintendents.

MR. TAYLOR: Student services coordinator?

MR. CHAIRMAN: I'd just like to remind the member for Colchester-Musquodoboit Valley to allow the answer to be given, please.

MR. TAYLOR: I'm just trying to help him, thank you, Mr. Chairman.

MR. PARKER: There are staff there, but not assistant superintendents. There has to be staff there. We have a lot of special needs students out in our areas, we need people to address those. We need people to address the disciplinary issues. Our family of schools supervisors are there to deal with those. We don't want everything centralized in Truro.

I will say to this committee that one thing that has taken place since Mr. Miller came into place is that we have an organizational review under way now, looking at improving efficiency, effectiveness, so that we can have the best delivery to our students in our classrooms. That organizational report will be coming before the board, being done by the former Deputy Minister Lloyd Gillis, in early April, looking at ways to streamline administration.

I will reiterate that it was a very conscious decision to do that because we didn't want everything centralized in Truro. That was a strong feeling at the time of amalgamation and that was a big reason why they didn't want to go that way. Yes, we pay a cost for it, but I visited a lot of schools and the people in those schools have told me that those family of schools' personnel are absolutely essential to them to operate. Those are people who are assisting them every day and I don't think our system would be near what it is today without those family of schools offices, I really don't.

MR. CHAIRMAN: Thank you, Mr. Parker, and thank you, Mr. Taylor. We're going back to each caucus now for 10 minutes which will allow some time for wrap-up comments. It's 9:26 a.m. and I recognize the member for Halifax Fairview.

MR. STEELE: Just a point of procedure, Mr. Chairman. If we each go now for 10 minutes and then have a wrap-up comment, we're going to go well past our finish time with no time for business.

[Page 31]

MR. CHAIRMAN: You're wasting time now. Stick with my math, it's a very short business meeting. It's 9:26 a.m.

MR. STEELE: Okay, thanks. I had some other questions I wanted to ask, but I really want to go back and sort of try to look at the big picture here because what you've seen here today seems to me very much symptomatic of the problem that school boards are facing in general and your school board is facing in particular. We're now at the stage where the government caucus, the Progressive Conservative members feel that it's okay to attack school boards. They feel that it's okay to throw out a bunch of allegations about the hiring of particular individuals, about renovations to school board offices, bonuses to somebody's secretary, allegations that it's top-heavy with administration. The sheet that's just been handed out that Mr. Taylor was referring to, clearly this was prepared either by the Department of Education or by the government caucus itself. So this is not something that they're coming up with as individuals.

The government feels right now that it's okay to attack school boards, that public support for school boards is slipping. I will at least give the members on the government side credit for one thing and that is that they are reflecting what people in their communities are talking about, that these kinds of things, like the allegations - which I have heard as well - of the hiring of relatives of the former administrators is a very corrosive thing, very bad for the community unless it's put to rest once and for all.

Let me start with a simple question and I will move on to more complicated ones later. The first question is, if this is not the forum to deal with those issues, what is the forum where the school board is going to confront directly the gossip, the rumours, the innuendo that have been given voice to today by the government caucus?

MR. PARKER: I will turn that over to Mr. MacIntosh as to what forum it should be done in. On personnel issues, we certainly respect people's individual rights.

MR. CHAIRMAN: Mr. MacIntosh.

MR. MACINTOSH: Mr. Chairman and Mr. Steele, I'm not sure if I'm the best qualified, but I will try. If there are such issues, I think this board would agree that they are legitimate concerns that should be addressed. It's simply a question of here. For example, there was reference to a bonus payment. I can tell you I personally, as counsel for the board, have never heard that allegation before. Dr. Murphy indicated that he had not, so that's why we're loath for fishing expeditions in a very public forum like this where you've got cameras and media and somebody may be harmed who doesn't deserve to be harmed.

[Page 32]

If there are legitimate concerns about our hiring policy, I think Dr. Murphy could give you, if the committee wishes, a three or five minute overview of the lengths to which this board has gone to remove some of the traditional old ways of hiring. It's up to the chairman or the superintendent or Dr. Murphy to tell you whether they think that system is perfect.

I think, as compared to any other board, this board has made advances in its hiring practices they are very proud of. It may not be perfect and if there are specific concerns this committee has, please let us know and we'll investigate them. But we're loath to discuss particulars here this morning.

MR. STEELE: And you know, Mr. MacIntosh, I understand that. I understand that completely. In fact, I think it indicates where they're coming from that the first time the senior administration of this board would hear these allegations is here in this public forum; not in a letter, not in a phone call, not in a meeting, but the first time you hear about this gossip which has now been elevated to the level of the Legislature, is right here in this forum. That's where the government is at - that it's okay to attack school boards - and I think to a certain extent it's true that that's where the public is at. Because, very unfortunately for your school board, your difficulty occurred at the same time as the difficulties in the Strait Regional School Board. The only reason we're not dealing with that is because it's gone much further down the road of a criminal investigation. So that's why we're dealing with Chignecto-Central today and not the Strait Regional because of the way the Strait one is by any estimation much more serious.

[9:30 a.m.]

But let me ask you then about this, about the government clearly feels it's okay to attack the school boards. I wonder, Mr. Parker, if I could ask you to comment on your assessment of the board's relationship today with the Department of Education.

MR. PARKER: I will certainly be mentioning some of that in my closing comments, Mr. Steele. We attempt at all times to work closely with the Department of Education. We're accountable to the minister, as a board, we're also accountable to our public. We work closely with the department on every avenue to try to find solutions to problems, but I will make no secret of it that boards feel very much under attack at this time. These events here, as unfortunate as they are and as much as the board has tried to do the very best they can with them, we feel they are being used as an excuse to attack school boards.

I guess if that's the motive, then fine, but we'll continue to work with the department, we have to have a close working relationship with the department and there are a lot of people in that department that we work very well with every day, whether it be on new school construction or whether it be to do with programs. We have a close relationship with the department and most of the time there's not any problem. Whether there's a political

[Page 33]

motivation here somewhere that's different from what we're dealing with in the department, we try to work closely with them and they point out our faults and we point out theirs.

MR. STEELE: Mr. Parker, as I mentioned, I do at least give the members of the government caucus credit for reflecting what they hear in their community. This gossip is out there, the rumours are out there. I represent a Halifax riding and I have heard it. I have heard the allegations, the gossip about Chignecto-Central and in particular, the allegation of the inappropriate hiring of relatives. There's a problem here with public trust. My sense is, the public is losing, has lost, their sense of trust in the ability of school boards to be effective managers of the public duty that they've been entrusted with. Do you believe that relationship of trust has been damaged beyond repair and if it hasn't, what is the school board going to do to try to re-establish that trust which I believe is being lost?

MR. PARKER: I would agree with your comments that public trust has certainly been damaged over the past number of months between the incidents that we talked of here today as well as in the Strait Regional School Board. I think when the public looks at it as a whole, they will see that the problem was not with elected board members and that was pointed out very much by the minister's investigative team from the three departments. Over and over we've been told that the problem existed, and I believe in the Strait Regional School Board as well, with very few top administrators in that board and our board detected it and our board dealt with it and dealt with it properly which any governance body would have been expected to do.

As far as trust goes, I think in some cases perhaps the trust is being eroded because there's a continual attack in the media and a continual play-up of these incidents despite many other good things that are happening in school boards. I think a lot of the people out there also know that there are a lot of good things happening and that school board members are doing their job and they found top administrators not doing their job and dealt with it.

As far as the incident you speak of to do with personnel issues, questions were asked and answers were given as to the fairness of those processes in some cases. Some cases are new here today, but we do the best we can as an elected school board to try to make sure that there's fairness. We follow the procedures of hiring; we give our policies and procedures to our Human Resources Department and we expect them to be followed.

MR. CHAIRMAN: You have under a minute, Mr. Steele.

MR. STEELE: At this point, I will finish and turn my time over to the next questioner.

MR. CHAIRMAN: Thank you. The member for Cape Breton West. It is 9:35 a.m.

MR. MACKINNON: Thank you, Mr. Chairman. Mr. Parker, do you have the details of where that $1.7 million was spent and what it was spent on?

[Page 34]

MR. PARKER: Yes, we do have those figures with us, and I can turn that over to the chairman of the Finance Committee for any details you would like on where the $1.7 million is. It is attached to the Sampson Report, which I believe was made available.

MR. MACKINNON: No. We received the Sampson Report. It referred to it but it wasn't attached. Actually, if . . .

MR. PARKER: We can make it available, but we certainly . . .

MR. MACKINNON: Perhaps your finance expert would give us that detail as we are speaking. Would you please explain where that $1.7 million was spent?

MR. CHAIRMAN: Mr. Marks.

MR. MARKS: As chairman of the Finance Human Resources, I can give you details to the last penny, and they are quite extensive. Perhaps what you would like me to do is take some highlights out of this.

MR. MACKINNON: Yes.

MR. MARKS: For instance, Cobequid Education Centre locked its doors, to the tune of $37,695. The Cobequid Education Centre's upholstered chairs in the AV room, $15,720. If I skip a few of these - St. Mary's Elementary School, a PA system for the gym, $3,668. East Pictou Rural High School, the upgrading of the tech lab, $3,248.80. East Pictou Rural High School, a display unit, $1,886.

MR. MACKINNON: Perhaps we will fast-forward. Do you have the breakdown on a county-by-county basis?

MR. MARKS: I have some breakdown related to family of schools. If I was to look at. . .

MR. MACKINNON: What about in the Celtic schools?

MR. MARKS: Yes, I do. I have that. . .

MR. CHAIRMAN: Okay, take your time. We are looking at the breakdown in family of schools, and the Celtic office was the specific one, I believe.

MR. MARKS: It is $446,109.66.

MR. MACKINNON: Where is that located?

[Page 35]

MR. MARKS: It is in Pictou County. Stellarton-Westville. . .

MR. MACKINNON: Who is the elected official for that area?

MR. MARKS: Well, there are several of us. I am one.

MR. MACKINNON: Who are the others?

MR. MARKS: Dr. Lawrence MacKinnon. . .

MR. MACKINNON: And?

MR. MARKS: . . .Marilyn Murray and Robin Bourque. There are four of us who represent that particular area.

MR. MACKINNON: Okay.

MR. CHAIRMAN: Thank you, Mr. Marks. I would assume that we will be receiving the specifics to which you refer there.

MR. MARKS: Yes, we will make them available.

MR. CHAIRMAN: Thank you very much. Mr. MacKinnon.

MR. MACKINNON: I guess I want to go back to the issue of Mr. Parker's statement about trust. I know my colleague for the NDP - maybe rightfully so, maybe not, I am not going to judge - has spent a good deal of time attacking members in here for asking provocative questions, maybe, on naming names and human resource issues. That is certainly a question that one could take issue with or not. I want it to be clear for the record; this is the same member who wanted the Strait Regional School Board in here even before the facts were on the table and the RCMP had an opportunity. So if we are talking about accountability and trust, we have to be careful.

I want to speak specifically to the board. I must be honest; you know, I take some comfort in the fact that your new superintendent or CEO or whatever the official title is will bring a breath of fresh air into this process. But there has been little evidence given that would give confidence that, in fact, things will change, other than your word. Before the Public Accounts Committee, Mr. Parker, that is not sufficient to come in - and I will give you a clear example.

You have a business plan before the Department of Education and yet not one elected official from the Pictou County area - and you suggested that the other MLAs were not privy to this particular document. I come from the Cape Breton-Victoria District School Board and

[Page 36]

every MLA was fully briefed on the business plan that was put forth to the Department of Education.

I would submit that your words, you know, are hollow compared to your actions. That's why the issues of innuendo and apprehension and whatever terminology you would like to put out there are there, because you are saying one thing and you are doing quite another, sir. From our caucus point of view, that's the concern we have. You haven't established that level of confidence yet. You are only saying that you are going to give it to us.

MR. CHAIRMAN: Mr. Parker.

MR. PARKER: I would like to respond to that. I don't agree with the member that the words are hollow but if that's his opinion. Certainly this board has worked very hard at trying to look at what are the things we could do to prevent the same thing from happening that happened last fall. The major thrust of that up to this point has been the Grant Thornton recommendations, which our board adopted in Thorburn about three weeks ago; 13 of those recommendations, I believe, which will show that the board has moved in a very positive direction to try to make sure those events don't occur again. Those include the board considering establishing an audit committee. Actually the finance committee meets tonight to begin the process of setting up that audit committee.

The audit committee plays an active role in dealing with the external auditor. Again, that's going to take place under the auspices of the audit committee. Board and management consider establishing an internal audit function. Again, responsibility of the audit committee. There is mention of better education for board members, and I will emphasize that when these boards were put together in 1996, the government of the day put together a large number of people from all different areas with really no education as to how to run a much bigger system. The board members were on their own to try to do the best they could with their staff. It certainly was difficult because we were dealing with much larger areas and dealing with the public who felt left out.

So I think the board has done, to my mind, an excellent job of bringing those areas together over the last five years into a cohesive unit. Yes, there were some top administrators who stepped out of line and, yes, we are addressing that. We adopted, I believe it was 12 different recommendations out of the Grant Thornton Report that will be implemented and those are some of the key ones. So I think this board has taken a lot of steps to try to improve trust in the system. I guess I just disagree that that hasn't been done.

MR. CHAIRMAN: You are under two minutes, Mr. Downe. The member for Lunenburg West.

[Page 37]

MR. DONALD DOWNE: Thank you very much. I want to say that, obviously, the report that came back from the minister indicated very clearly that the minister of the day is satisfied with the board's activity and what they have done, in fact, said that the investigation did the - the board took the appropriate actions in regard to the allegations in the situations that happened.

You are elected, so obviously you are accountable back to your people, as well as anybody here. So I appreciate where the board has come from and I appreciate the fact that the board has put in place a number of initiatives to clarify and to strengthen the clarity and the accountability of the board and the actions of some of the staff within the board, previous staff of the board.

I guess I want to change the direction a little bit, just to understand one thing. Two things. One is, I would like to understand whether or not the quality with the amalgamation that has currently gone on since 1996 - some said, not all that willingness to do that - has the quality of education improved because of that, to the students? Ultimately, that is what you are there to do, and that is to provide education to the students. So quality of education improved in the area by the amalgamation. Secondly, I want to find out a little bit more about the business plan. But the first question in regard to the quality of education.

MR. PARKER: I believe the quality of education has improved, and I have heard that again as the vice-chairman and myself have visited schools from Amherst down to the Halifax line, over to East Pictou. The comments I generally hear are that we are able to offer programs that we weren't able to offer before because what we did was we took the best from the three areas and those were implemented right across the district.

[9:45 a.m.]

Perhaps the best example, or one of the best examples, I can use of that would be what was earlier mentioned, our Occupational Preparatory Program, which had already been born in Pictou County for a few years before amalgamation - a great help to many of our students who perhaps aren't going that far along and aren't terribly interested in academics but are kids with all kinds of ability. We've been able to spread that across our entire region. We have one in each area now, five different OPP programs, working very well. That's only one area, but I could mention several others where the quality has improved. Generally, despite the difficulties of trying to operate a very large area which will always be there, I think we have greatly improved the quality of education.

MR. CHAIRMAN: I'm sorry, Mr. Downe, your time has elapsed. I'll turn the final 10 minutes over to the member for the government caucus, Mr. Taylor, who I believe has a question.

[Page 38]

MR. TAYLOR: Mr. Chairman, I'd like to advise the board's legal counsel that my prerogative here this morning is public accountability and trying to ascertain whether or not the taxpayers in the Chignecto-Central Regional School Board's district are receiving good value for their dollars. We're not here to question the integrity of the board, either staff or elected members.

In that context, I'm still very concerned that elected board members, I presume - again, I'm not sure of the correlation or the relationship between the elected board members and staff - and trust that somewhere along the line a recommendation came from staff asking that they approve moving the family offices from Milford to a previously-condemned school. I attended meetings, several meetings, in Elmsdale because a number of my constituents, as well as those of the honourable member for Hants East, attend schools in Hants East. We were told by professionals and perhaps by some of the individuals in the delegation here this morning that that school was, in fact, not environmentally sound.

Now, mysteriously and quite perplexingly, the board has set up shop. Not only has it moved the family offices there, it is setting up shop as a landlord and is going to try to bring in tenants. A lot of these tenants, most tenants, reside in the private sector. If you're going to take a tenant from the private sector and put it into a building that's subsidized by the taxpayers, I have big concerns about that, Mr. Chairman. I've been told through the media, through The Halifax Chronicle-Herald, that it only cost $8,000 to renovate that old Elmsdale Elementary School. Well, for Pete's sake, if it only cost - and I would ask for some documentation to be tabled to actually confirm that it only cost $8,000 to remove oily soil. There was an oil spill there; I don't know if buildings were torn down or what the heck happened, but I know there was a lot of renovation that took place to that building.

I understand the square footage that you're charging the tenants is a heck of a lot more, pardon me, is less than they're charging across the road at the Sobeys complex. I've heard $10/square foot where Sobeys charges $20/square foot; I've heard $14/square foot. I don't know what you're charging, but if you're charging more and you're only attracting government agencies as tenants, well then it's costing the taxpayers more money because there's only one taxpayer. And if you're charging less, I don't think you should be in that business at all.

Mr. Parker, as an elected board member, how do you respond, and what was the elected board members' involvement in that?

MR. PARKER: Ron, do you want to speak on that?

MR. CHAIRMAN: Mr. Marks is going to answer this question?

MR. MARKS: Mr. Chairman, again we have to go back, I guess, and get a little bit of a history lesson. In 1996, the government of the day indicated to the boards that one

[Page 39]

section they wanted us to look at was revenue generation. Our board has taken that to heart, and opportunities have come forth where we've been able to generate revenue to put back into the classroom. When the question is asked, should we or shouldn't we, that's a policy issue. Should we or shouldn't we be in the revenue generation business - I believe that's a policy issue that should go back to the Department of Education, it's not one that we can answer here. We're following the dictates of the day, and by the way, we're doing a pretty good job at it.

MR. CHAIRMAN: Thank you, Mr. Marks. I would refer the remaining time to the member for Pictou West. You have six minutes, Muriel.

MRS. MURIEL BAILLIE: Mr. Chairman, I do want to congratulate Mr. Miller on his new position. Nice meeting you. I'm going to continue, maybe, with the line of questioning that my colleague Mr. Taylor was taking. Of the six families of schools, five families - I thought there were six. I count six. (Interruptions) It's all right. I know one is, of course, housed in the River John School. It's in my community. I think that's great. We maintain the building; it's less expensive for the board. I was just wondering if you could tell me, of the remaining schools, families, how many are housed in existing schools, schools that are used to educate children today?

MR. CHAIRMAN: Mr. Miller.

MR. MILLER: Thank you, Mr. Chairman. It would only be that particular family. The others are in other facilities, the Celtic family and so on.

MRS. BAILLIE: Well, my line of thinking would be that we would be saving money to be housing them in schools. Why not? Is there any thought to housing them in existing schools?

MR. MILLER: I believe, Mr. Chairman, again, that when Mr. Gillis finishes his organizational review we will be considering all issues regarding families, their number, their location and so on. That will be part of a comprehensive review of the structure and their location. But I take your point, Mrs. Baillie.

MR. CHAIRMAN: I'm sorry, Mrs. Baillie, have you finished?

MRS. BAILLIE: I think so.

MR. CHAIRMAN: Okay.

MRS. BAILLIE: I just have one quick question, if I could.

[Page 40]

MR. CHAIRMAN: You have lots of time. You have five minutes. Go. I'm sorry. Mr. Marks, you have something to add to Mr. Miller's comments?

MR. MARKS: Yes, I do.

MR. CHAIRMAN: Yes, go ahead, please.

MR. MARKS: Again, we have to go back to when the board was formed. There are two different opinions when we look at whether we should be in schools that have space, or we should be in previously-owned facilities or, in the case of Springhill, where it existed and we actually rent for a nominal charge from the Town of Springhill, and there are pros and cons for all of those. For instance, one of the reasons we don't like putting them into existing schools is the traffic that comes in and out of the particular school, how do we control that and how do we know who is on the school grounds? On elementary schools or schools in particular, we like to know who is there. What happens is, when we put them in schools, that was one of the difficulties that we had to deal with. So we have different arrangements for different reasons.

MR. CHAIRMAN: Thank you. Mrs. Baillie.

MRS. BAILLIE: I was just thinking more or less dollars and cents savings.

Mr. Miller, you said you have 91 schools in the area, how many buildings does the board own? Do you have any idea?

MR. MILLER: My colleague tells me about 100.

MRS. BAILLIE: Okay. Just table that would you please, would you mind? Thank you.

MR. CHAIRMAN: Mr. DeWolfe.

MR. JAMES DEWOLFE: Okay, thank you, Mr. Chairman. Again, I would like to welcome Mr. Miller back home to Pictou County, an old school colleague of mine. I hope you enjoy the town area.

The sudden drop in enrolment this past year almost is alarming. Most of the school boards have been losing fairly consistent enrolment numbers of the past years. Can you explain the tremendous blip in the enrolment decline in the Chignecto-Central? For the past number of years we have been losing around 300 students a year, over those years, and all of a sudden there is a drop of more than 500 students in one year. Now, the Department of Education can't explain it. On the surface it looks like the sudden drop of enrolment this past year almost makes it look as though someone was fudging the numbers for the past few years

[Page 41]

in order to get more money for the school board. Now, I am looking at it from that spin because there are so many things happening here and I just hope that that's not the case. Perhaps you could get back to this committee with the actual numbers for enrolment and as to why the enrolment dropped so significantly in the past year?

Before I let you answer that question, I just want to say that this government is supportive of the school boards in this province and we are not attacking them. We are, today, here addressing some very, very serious, significant issues; issues like the spending of $1.7 million. That should not be misconstrued as an attack. We have increased funding, this government, to the school boards in this province since we took office in 1999. We want to work with the school boards and improve accountability, as you, Mr. Miller, do, to the children in the classrooms and to the taxpayers who ultimately fund the schools.

I believe that elected school board members - and my heart goes out to them because some of them are caught in this and didn't really know what was happening but I realize that these elected members are from our community and their hearts are in the right place. They have the children's best interests in mind. I truly believe that.

MR. CHAIRMAN: Mr. DeWolfe, if there is a question there, I will take it. Otherwise, I am going to have to cut you off.

MR. DEWOLFE: Well, if there is not time to answer the question, perhaps I could get back with the exact numbers. I want the exact numbers from the past few years and the exact numbers this year.

MR. CHAIRMAN: Okay, Mr. Marks, would you quickly respond to that and then I will recognize Mr. Parker for his wrap-up comment.

MR. MARKS: Thank you. First, it is absolutely untrue that the board would put numbers to the Department of Education that are false. In actual fact, when we come to numbers of children in schools, we do five-year projections. The Department of Education is totally familiar with those. As part of our budgeting process, we review those. There is a September 30th date when we go around and actually count the people who are in our schools. So, in actual fact, that is how those numbers come about.

To indicate why we have such a drop, we knew the drop was coming. It is quite evident; we just don't have the kids in schools. For that particular year when those children were born, there weren't that many born, compared with other years. Generally within our board, we have areas that are declining, as Cape Breton does. Pictou County tends to be one of those that is dropping quite significantly.

But I can assure this committee that the Department of Education and the board work hand in glove to make sure that those numbers are correct.

[Page 42]

MR. DEWOLFE: Thank you, Mr. Marks. I would appreciate those numbers if you could supply them, though.

MR. CHAIRMAN: Thank you. Mr. Parker, I encourage you or any member present for some concluding comments.

MR. PARKER: Thank you, Mr. Chairman. Before I start my printed comments here, I just want to comment on the numbers issue again. Certainly Pictou County is one of our fastest-declining areas in this board as far as enrolments go. There is no doubt that our young people are leaving and going elsewhere for jobs. That is one of our main problems. They go elsewhere; that is where they have their families, and we are losing numbers fast, as is Cape Breton, obviously.

Following the earlier-mentioned emotions of disillusionment, disappointment and anger, our board next went through a short period of self-doubt, self-questioning and guilt. I believe this was shared by the remainder of our senior management team, but I must emphasize the word short.

As elected officials we asked ourselves, had we fallen short? Had we dropped the ball? Others asked of us, were we asleep at the wheel? Was the board unable to control senior management? Was the good ship education drifting freely with no anchor in Chignecto-Central?

It very quickly became evident to all of us that the answer to each of the above questions was a resounding no. As a governance body, we had done exactly what would be expected of any governance body, be it public or private, when individuals choose to cross a well-known line and wrongdoing results.

We uncovered some inappropriate behaviours, albeit not criminal, through our own investigations and acted swiftly to bring them to independent legal counsel to verify that there were grounds to proceed, always fully cognizant of due process and procedural fairness.

We informed the full board as soon as possible, followed by a formal and complete investigation by legal counsel and senior board members to check the depth and breadth of the problem, took strong and decisive disciplinary action following the approval of the full board, and made a complete disclosure of all the facts to the Minister of Education, who has been kept aware of events during the investigation, as well as to other boards and to our public.

[Page 43]

[10:00 a.m.]

Yes, judgment errors had been made and lines had been crossed by two long-time senior administrators. Nobody else had done anything wrong and no taxpayer dollars have been lost to our education system, save the very costly process of our initial investigation and its ongoing recommendations.

I must stress that this whole affair opened and closed within a period of four weeks. When it was over and the board was convinced that it had performed its governance duties and performed them well, we very quickly turned the page and looked straight forward. We met with senior management, told them we needed everything they had to give at this critical time in our young history. They gathered behind our new educational leader, Mr. Gary Miller, and have never looked back. As board members, we realized there would be a natural instinct to want to micromanage our system. We soon accepted the fact that this would only hurt our system and our children's education and instead focused our efforts on how to put up higher fences and how to provide more training for board members to hopefully prevent future similar events, realizing our limitations as lay board people working on a part-time basis.

Where to from here? We feel as a board that we have proven our mettle through tough times. We have done everything that could be expected of a public governance body in this province and this has been verified by the minister's tri-department committee. We are in the process of implementing tighter financial checks and balances, new budgeting and financial reporting systems and reviewing our organizational structure for best efficiency and effectiveness. No system is perfect and while we are very proud of our past accomplishments, including six consecutive balanced budgets, we recognize these events have shaken public confidence and we recognize there are valuable lessons to be learned and improvements to be instituted here.

We have been appreciative of the minister and her department for her help over the past months and look forward to their continued assistance, especially in the field of training for board members to do our jobs better, as well as financial assistance to help defray the cost of doing things right.

We realize public confidence has been shaken by these and other events and this has spread to all school boards across this province. It would be a grave mistake and one with long-lasting implications to public education in this province to use that shaken confidence and these unfortunate acts by very few to declare that school boards are dysfunctional and unaccountable and therefore should be restructured and put under tighter reins.

School boards have a long history in this province and the people want decisions made about their children's education to be made by parents and grandparents of all walks of life living in their home communities. Not only that, we believe they want and understand that

[Page 44]

school boards need to be making decisions that affect all aspects of our system, including . . .

MR. CHAIRMAN: Excuse me. Mr. Taylor?

MR. TAYLOR: Yes, Mr. Chairman, I'm wondering, in the interest of time if the honourable . . .

MR. CHAIRMAN: I was going to. I'm remiss because of my timing today, Mr. Taylor, but I would like to not cut you off, sir, but if you could wrap up, I would appreciate it.

MR. PARKER: I'm on the last page.

Not only that, we believe they want and understand that school boards need to be making the decisions that affect all aspects of our system, including financial, operational and educational. The public knows that it all ties together and that good decision making involves all aspects of our children's education.

Put quite bluntly, how many times do you need to change the governance structure before you accept the fact that the well-recognized problems and challenges of our educational system are not the consequence of electing community-based school boards? To draw an analogy to a hockey team, how many times do you fire the coach before the team owner realizes the equipment is old and the skates are dull?

In closing, I want to make a small "p" political statement because this is a political forum. Mr. Chairman and members of the committee, many of us believe there are some within the bureaucratic levels of the Government of Nova Scotia who have a secret agenda to gradually deprive our elected school boards of their effectiveness.

MR. TAYLOR: Mr. Chairman, on a point of order, please.

MR. CHAIRMAN: Excuse me, Mr. Taylor, I have been assured this is the wrap up and I am going (Interruptions) Mr. Taylor, I'm sorry.

MR. TAYLOR: On a point of order. I think it's time, Mr. Chairman, that the honourable gentleman perhaps send in that editorial comment to a number of people appropriate so we can get on with other business that we have. The time for this hearing is from 8:00 a.m. until 10:00 a.m. and that's been the procedure in here, it's nothing new.

MR. CHAIRMAN: Thank you. I would ask that you table those comments if you could, Mr. Parker. I'm going to call upon you to conclude, thank you. (Interruptions)

[Page 45]

Okay, thank you. We are going to have a quick recess. I have done the miscalculation. My apologies to members who have other commitments. Mr. Steele is right for a change, so we'll have a quick recess and then we'll come back for two quick items of business. Thank you.

[10:05 a.m. The committee recessed.]

[10:06 a.m. The committee reconvened.]

MR. CHAIRMAN: I would ask members to reconvene, please, and if you could take your conversations out in the hallway. We have a couple items of business, one that I have brought forward and one that has just been tabled. I understand Mr. Taylor's comments and I did the math, thinking that questions and answers would take 10 minutes and they took more. I will add caution to that the next time I make that decision from this chair.

The first item of business is our next set of witnesses are representing various government departments and I would like clarification from the members or, Mora, I would like clarification from you - whether you believe it is necessary - to send out, in advance, these comments that we no longer read into the record and we provide them to the witnesses. This is the statement that says nothing you say to us here today can form the basis, et cetera; is that necessary, in your opinion, to send out to government officials when they appear in front of the Public Accounts Committee? Comments, please. Mr. Steele.

MR. STEELE: Mr. Chairman, in short, yes. A witness is a witness and we shouldn't draw any distinctions. Their duties and responsibilities belong to them personally and we shouldn't draw distinctions about who gets that notice and who doesn't. I would draw a distinction in terms of, for example, who is asked to swear an oath because there are other means of accountability for government officials but in terms of their rights and responsibilities, their rights and responsibilities are the same as everyone else's. So I would very much support the same statement being sent out.

MR. CHAIRMAN: Other comments to this question. Mr. Morash.

MR. KERRY MORASH: I believe if we send to one we should send to all just to be consistent. I agree.

MR. CHAIRMAN: So we have consensus - I'm sorry, I didn't recognize any member from the Liberal caucus. I see Mr. MacKinnon nodding, so I will accept that in future we will take those guidelines.

Furthermore, I have provided a copy of a note that was handed to me earlier from Mr. Steele and I will recognize him on the handwritten memo which you circulated. Graham.

[Page 46]

MR. STEELE: Mr. Chairman, this has been circulated to all members of the committee. I would like to make two motions further to what we have heard this morning and I would like to do them separately, if I could. The first one is, I move that the Public Accounts Committee request that officials from the Department of Education appear before the committee to speak to the issues at the Chignecto-Central Regional School Board.

MR. CHAIRMAN: I recognize your motion. Are there any other further comments? On the motion, Mr. Steele.

MR. STEELE: Just by way of explanation, it seems apparent that if we are going to hear the whole story, we need to hear the perspective of the Department of Education. It is very apparent that what happened here is the Department of Education is very much involved and we need to hear from them. If we don't hear from them, we are not hearing the whole story. It is really that simple.

MR. CHAIRMAN: Thank you. Mr. DeWolfe.

MR. DEWOLFE: Mr. Chairman, I am against pursuing this topic right now and the main reason is that we have an agenda before us that we would like to get to and we are all very busy now with the House opening. We have an agenda set down several weeks ahead.

Also, I believe, Mr. Chairman, that we have talked about serious issues here today. It is all in the forefront. The Department of Education, the authorities and the school boards now have to sort this out and get on with it. I don't see any productivity coming out of any future hearings.

MR. CHAIRMAN: Other speakers on the motion. Mr. Taylor.

MR. TAYLOR: Mr. Chairman, I recognize that I'm substituting for an honourable colleague but I would like to concur with the vice-chairman of the Public Accounts Committee that the committee does have an agenda. I know it would be quite easy to get somewhat sidetracked on this issue. It is a very important, topical issue, there is absolutely no question about that, but I do think in the interest of the agenda and the fact that the House is going in, we all would be perhaps better served to give this some consideration at a later date. Thank you.

MR. CHAIRMAN: No, Mr. Taylor, look, you're really a cracker when it comes to time and I recognize you for those very important comments.

I will call the question. Would all those in favour of Mr. Steele's motion please say Aye. Contrary minded, Nay.

The motion is defeated.

[Page 47]

Mr. Steele, I would refer you to the second motion.

MR. STEELE: My second motion, Mr. Chairman, although I do have to express my amazement at the fact that they are too busy, apparently, to hear the whole story but never mind.

MR. CHAIRMAN: Would you get onto the motion, please?

MR. STEELE: Yes, I will. I would like to move that the Public Accounts Committee again invite Mr. Elmer MacDonald and Mr. Robert Renouf to attend, and if they don't respond favourably within three weeks that legal counsel to the Public Accounts Committee be requested to prepare and issue subpoenas.

Mr. Chairman, if I could now speak briefly to the motion. I think all members of the committee are aware that Mr. MacDonald and Mr. Renouf have previously been asked to attend and I believe I am correct in saying that they have responded by not responding. It would be a dreadful precedent for this committee to set, simply to pass over witnesses that we have previously agreed to be invited simply because they choose not even to respond. Again, in order to hear the whole story, I think we need to press this further with the witnesses we have previously invited, namely Mr. MacDonald and Mr. Renouf, and that's the reason for the motion.

MR. CHAIRMAN: Thank you. Mr. DeWolfe.

MR. DEWOLFE: Mr. Chairman, again, I feel that at this time - and I stress at this time - it wouldn't serve any useful purpose to the taxpayers of Nova Scotia to pursue this matter and I would suggest that we look at it. We already have plans to invite the Strait school board in when we discussed it at an organizational meeting. Following the RCMP investigation, we will be dealing with many of the same issues, only perhaps more at that time. If we decided after that particular meeting that we wish to pursue this, we do have the power of subpoena and I would suggest that we may have to use it at that time.

Incidentally, I just want to conclude by saying that those two people who were mentioned were agreed upon by this committee in the past to be here and we fully expected them to be here today. As Mr. Steele had said earlier, they chose not to show up and that says a lot right there.

MR. CHAIRMAN: Mr. Langille.

MR. LANGILLE: Mr. Chairman, really, when you look at it, today is a prime example. We have five government caucus members here. Obviously, in a less than two hour span, to have the school board in doesn't give the time that it should. There should be further time set aside for this next Wednesday, to take the time to go over. There are just too many

[Page 48]

issues here and I say again that the time allotted for the Public Accounts Committee on an issue like this is just not enough time. When the Strait board comes in, are you going to do that in an hour and a half with what's going on in the Strait board? There's not enough time in the Public Accounts Committee.

[10:15 a.m.]

MR. CHAIRMAN: Well, Mr. Langille, I can point out that organizational meetings that are held regularly could allocate further time. It could be two sessions each. I understand your point of view. However, I would like to turn to the motion, if I could. Are there any other speakers on the motion? Before I recognize you, Mr. Steele, are there any comments from the Liberal caucus? None. Mr. Steele.

MR. STEELE: I agree with the member for Colchester North. The way to devote more time to this issue is to call in more witnesses so we can hear the whole story. I'm really hoping that the member for Colchester North will vote in favour of this motion.

MR. CHAIRMAN: On that topic, I would like to call for the question. Would all those in favour of the motion as put by Mr. Steele please say Aye. Contrary minded, Nay.

I believe the motion is defeated.

I recognize Mr. Taylor, who is extending the time, but yes, Mr. Taylor.

MR. TAYLOR: Quickly, Mr. Chairman. If you feel it's appropriate, I would like to make a motion on behalf of the Public Accounts Committee that you write a letter to the Chignecto-Central Regional School Board and ask them to table documents, or a document, to confirm the total cost of renovating that Elmsdale school. I don't believe that question was ever adequately answered and I would ask perhaps, Mr. Chairman, that you, by way of a letter to the board - and I'm making this a motion - request that they provide this committee with confirmation of the total cost of renovating that previously environmentally unsound school, or so we were told.

Also, just as a caveat to that question, I also had asked them specifically, and no one responded, as to what made that school safe now for occupancy by human beings compared to back then when in fact we were told that that school is no more fit - teachers, students, parents, you have to stay out of that school. So along those lines, I would make that a motion.

MR. CHAIRMAN: That is a motion and I want to clarify for you, according to - and we will review the minutes - there were three commitments, were there not, Mora? (Interruption) More commitments to bring forward, maybe you could just review them if you could.

[Page 49]

MS. MORA STEVENS (Legislative Committee Coordinator): What I have down for documentation that was requested was the 2002-03 draft business plan, the closure study on East River-St. Marys school that includes all the dollar figures, the term teacher statistics for the last six years, the Sampson report, the detail section on the dollars spent for the $1.7 million and a breakdown of that.

MR. CHAIRMAN: Mr. MacKinnon.

MR. MACKINNON: Excuse me, Mr. Chairman. In Mr. Sampson's letter, he referred to several attachments. It wasn't just that one but all the attachments.

MS. STEVENS: It would be the complete follow-up sections of that Sampson report and that would include that and I will highlight that specifically. There was also the cost of the renovations to the Elmsdale school, a complete breakdown, and the cost and charges per square foot of the rent. That was also mentioned. Now I just got this from Hansard, I was out of the room when Mr. DeWolfe asked for it, it was the school enrolment figures for the Chignecto-Central Regional School Board. That's all I had written down that had been asked for. I'm not sure if there is anything else. I told Mr. MacIntosh I would be faxing this list to him today and I also go over the transcript a week later to see if there was any other documentation that was asked for to please provide it.

MR. CHAIRMAN: Mr. Taylor, you have an addendum, I assume.

MR. TAYLOR: In that context, would it be appropriate, Mr. Chairman, to have you, of course with capable assistance, send a letter reminding the board that there were a number of requests made. I'm very concerned about that situation and I know the other members are concerned about the requests they had. Could we perhaps put a letter together that would collectively remind the board that we would like that information very much?

MR. CHAIRMAN: Well, if the motion passes, we will be forthcoming with that letter.

Mr. Steele, on the motion.

MR. STEELE: Are we voting on that motion? I have to say that because there was a speech mixed up with the motion, I'm not exactly clear on what the motion is for.

MR. CHAIRMAN: I am aware that I am to write to the Chignecto-Central Regional School Board listing the specific commitments that were made during the session this morning and we would like these to be forthcoming as soon as possible. Is that correct, Mr. Taylor?

Would all those in favour of Mr. Taylor's motion please say Aye. Contrary minded, Nay.

[Page 50]

The motion is carried.

Mr. Steele.

MR. STEELE: One last thing, Mr. Chairman. I'm pretty sure I know the answer but I have to ask it anyway, is it too late to ask for a recorded vote on my motion?

MR. CHAIRMAN: I don't think at this stage that it's necessary. Perhaps you should have done it at the time but considering the fact that we're 20 minutes over and I have another commitment, as the chairman I would ask for a motion of adjournment.

MR. MACKINNON: So moved.

MR. CHAIRMAN: We are adjourned. Thank you.

[The committee adjourned at 10:20 a.m.]