crs1026
Superstar
One thing that bothered me about TYSSE was how TTC waited until its overrun reached (IIRC) $450M before publicly owning up. Projects don't burn that kind of money overnight - much earlier, the project was no doubt known to be $100M overspent, and then $200M, then $300M. None of those overspends was reported at the time. Disclosure happened at the point where a) it was obvious that there was no room to recover and b) there was a plan for the political fallout of the inevitable fessing up. In other words, disclosure happened at the point where it was most convenient politically, not the point where the management first knew they had a problem.
The reason this is troubling (apart from the obvious issues of transparency and poor project performance) is that during my postulated period where a material overspend was known and growing, I wonder if the TTC released year end or other reporting that did not divulge the overspend, and which may have given a reasonable person the impression that everything was on track. I wonder if any such reports were backed up by an auditor's attestation as to their truthfulness. In publicly traded companies, that scenario may have professional and regulatory implications, for both the company and its auditors. TTC and ML are both government agencies, so they have a looser regulatory regime, although both have likely resolved that they will voluntarily adhere to the same standards as a matter of general best practice.
I am not a lawyer or accountant, and I don't know the point at which a government-owned corporation is legally obligated to divulge a material overspend or potential future liability (don't fool yourselves by P3 - Ontario will eat any overspend, one way or the other). Nor do I know what amount of overspend or delay would be the threshold for materiality. I am merely speculating on what might have happened. At this point it's moot for TYSSE, but having been disappointed once, perhaps it's best if that not happen again with Crosstown.
If someone were really wanting to enforce transparency over Crosstown's status, they would watch the official reporting closely for whether any delays or cost concerns were reported, or not. And, then, they would query ML's auditors on whether there was any evidence of same. That would likely get merely a non-answer, but it would set the stage for whenever the truth comes out. The question then would be, when were you first aware? Did you advise your auditors? Your board? The Minister? Why did you not answer us truthfully when we asked you?
ML may feel they have lots of latitude to spin tales to the public, but auditors have to maintain accreditation. And reputation.
All I'm saying is, rather than wondering whether ML will tell us anything, maybe someone should be asking whether they are legally obliged to do so, and under what circumstances, and when. And what the FOI implications are.
- Paul
(PS - the whole thing becomes complicated by P3, because ML is firewalled from the bare facts to some extent. However, the contract with the vendor will have requirements for periodic reporting, and probably requirement for timely disclosure of specific major issues, and it will allow ML the ability to maintain some level of oversight. If there is a delay or an overspend looming, ML may well discover that fairly quickly)
