NUNAVUT - Canada's auditor general says her 2008 audit of the Nunavut Housing Corporation identified many of the problems leading to the Nunavut Housing Trust's $60 million cost overruns.

On May 6, NHC representatives announced the corporation had underestimated costs associated with delivering the 726 housing units under the Nunavut Housing Trust.

Auditor General Sheila Fraser said when she learned of the corporation's financial trouble, she looked back through her own 2008 audit report looking for indicators of future problems.

"We mentioned that in a couple of communities, they had gone out for bids on construction projects and the bids had come in much higher than what they had expected," she said.

"So it might have been an early indication even then that the costs were going to be higher than their estimates, which appears to be the problem now."

Fraser said staff vacancies are to blame for the trust's inability to keep track of its spending.

Her report found 23 out of 89 positions were vacant within the department at the end of 2007.

"I really think the shortage of staff kind of contributed to the fact that the management reports weren't done, the tracking wasn't done," Fraser said. "It would appear when this new financial officer came in and perhaps the new president, then they started to sort of look forward and forecast forward and then realized they had this problem."

An independent audit is scheduled to be performed this summer, which Fraser said she would be looking into.

"We've offered our help to government to help them define what this review or audit should cover and, of course, we will be very interested in the results of that," she said.

Because it received separate funding, construction of the 285 houses to be delivered under the Affordable Housing Program will still begin this summer, NHC president Alain Barriault said.

Of those homes, 141 will be energy-efficient Structural Insulated Panel housing units. Barriault said the homes are more air-tight and have a higher insulation value than regular homes, which will save in fuel costs.

"We should be using less than 50 per cent of the heating that's required in the normal stick-built house built under the national energy code," he said.

Barriault said tenders for the project have gone out both in the North and in the South.

"We're hoping to get some reasonable pricing and the outcomes will determine what we're able to deliver," he said.