Andrew Raven
Northern News Services

Yellowknife (Oct 21/05) - The territorial government paid out more than $500,000 to an oil and gas industry consultant between 1996 and 2003, but kept little or no record of the work produced, an audit released this week revealed.

The report also said mid-level bureaucrats overpaid Kee Scarp, a company run by Todd Burlingame who's now head of the Mackenzie Valley Land and Water Board.

"This is somewhat troubling," said Inuvik Twin Lakes MLA Robert McLeod after news of the audit broke Wednesday.

"There should be some paperwork to back that up."

The audit was ordered in June after questions were raised over why Burlingame's firm received the contracts when he was chair of the Mackenzie Valley Environmental Impact Review Board.

According to the audit, Kee Scarp received seven untendered contracts from the former Department of Resources Wildlife and Economic Development between 1996 and 2003 totalling $514,078.

The department has since been divided into Industry, Tourism and Investment (ITI) and Environment and Natural Resources.

While Industry Minister Brendan Bell said he believes Kee Scarp fulfilled the contracts, he said the government record-keeping was "lax" and mid-level bureaucrats made questionable decisions on the file. "It appears as though work was done," Bell said Wednesday. "The biggest issue was with our ability... to follow what happened."

The findings included:

• All seven of the contracts were awarded directly to Kee Scarp. While Burlingame was likely the only qualified consultant in the NWT initially, later years should have been opened to competitive bids, the audit said. The department can only find five of the seven contract documents.
• The department overpaid Kee Scarp for three consecutive years, from 2000 to 2003. Mid-level bureaucrats authorized overpayment for professional fees and expenses.
• The department kept sporadic records for the $514,000 worth of contracts, which violated internal guidelines.
• In several cases, while Kee Sharp lived up to its contract obligations, the department failed to maintain its own documentation.

Because of the poor recording keeping, the auditor could not determine whether the government got its money's worth.

"The department did not follow its own standard terms and conditions," the report reads. "Limited documentation and poor contract administration does not allow for a clear statement on value... for the contracts."

Despite the internal problems, the auditor said department officials were satisfied with Kee Scarp's work and renewed its contracts for seven straight years.

Burlingame could not be reached for comment.

According to the audit, the work ranged from co-ordinating oil and gas conferences to consulting with communities, leading workshops and examining oil and gas reserves.

Hay River South MLA Jane Groenewegan said Wednesday the audit raises serious questions. "Surely there are some checks and balances that are missing," Groenewegan said in the assembly.

Bell said his department has taken steps to address the problem.

Contracts like those awarded to Kee Scarp now need ministerial approval and the government has a central contract database.

Premier Joe Handley said the problem was isolated within "one division of one department" and the bureaucrat behind most of the Kee Scarp contracts no longer works for the government.

"We want to make sure this does not happen again," he said.

The government will continue to examine whether its protocols were seriously breached, Handley said.