CITY FINANCIAL REPORTS DON'T SHOW WASTEFUL SPENDING

 

What City Financial Reports Don't Tell You

Every year the City of Nanaimo publishes audited financial statements. These reports check whether accounting procedures are followed correctly, but they do not examine whether money is being spent wisely or if taxpayers are getting value for their dollars. In other words, financial audits confirm compliance — not performance. So how do we shine a light on questionable or wasteful spending at City Hall?

1. Independent Oversight Models

- Auditor General for Local Government (AGLG): British Columbia briefly had an AGLG (2013–2021), tasked with performance audits of municipalities. Unlike financial audits, these examined efficiency and value for money. The program was discontinued, but it proved the concept works.
- Municipal Auditor General: Larger cities like Toronto have their own Auditor General, an independent office that investigates waste and mismanagement. Nanaimo could create its own if council had the will.

2. Forensic or Performance Audits

- Forensic Audits: Commissioned every 3–5 years, these dig into specific projects, contracts, or departments to uncover waste, fraud, or mismanagement.
- Core Services Review (CSR): Independent reviews that benchmark services against other municipalities and ask whether taxpayers are getting full value. These are powerful only if done by outsiders, not led by city staff.

3. Transparency & Public Tools

- Detailed Quarterly Reporting: Council could require quarterly breakdowns of wages, overtime, consultants, and project costs.
- Open Contract Portal: Public posting of all contracts, change orders, and sole-source deals makes it harder for bloated projects to slip through unnoticed.
- Program Review Committees: Citizen panels, given proper access, can investigate and publicly report on spending.

4. Accountability Channels

- Ombudsperson: In B.C., the Ombudsperson can review fairness in municipal decisions, though financial scope is limited.
- Public Pressure: Freedom of Information requests, media coverage, and citizen watchdog groups are often the only way wasteful projects come to light.
- Council Policy: Council could adopt bylaws requiring outside reviews of any project above a certain threshold (e.g., $5M).

Suggested Framework for Nanaimo

1. Adopt a policy for an independent Core Services Review each council term.
2. Mandate forensic audits for major capital projects over a set threshold.
3. Advocate for a revived Auditor General for Local Government, or establish a local equivalent.
4. Require contract transparency — posting every awarded contract and cost overrun online.

In short: audited financial statements only tell part of the story. To truly hold City Hall accountable, Nanaimo needs stronger independent oversight, regular performance reviews, transparent reporting, and clear rules to stop questionable spending before it drains taxpayers further.