February 13, 2004
(Executive Council)


Minister comments on statements made by Opposition Leader

Minister of Finance and President of Treasury Board Loyola Sullivan said today that the Leader of the Opposition is blatantly misrepresenting the facts on the cost of the independent external review in an effort to confuse the public.

"This government has remained open and honest with the people of the province about the independent external review of the province’s finances, including the cost associated with that work. The total cost to the province is just under $114,000," said Minister Sullivan.

Government received invoices from the external consultant, PricewaterhouseCoopers (PwC), on January 23, 2004, one for the original contract and one for the additional work required. Those invoices from PwC totaled $130,925.77, with HST component of $17,077.28 which will be reimbursed by the federal government, leaving the total cost to the province of $113,848.49.

"As a former premier, the Leader of the Opposition should know that, in accordance with the province’s Financial Administration Act, the Comptroller General must record HST as a receivable for the province, not an expense," said Minister Sullivan. "Businesses and organizations are required by law to charge HST and, therefore, government must pay it at the time of invoicing. However, it cannot be recorded as an expense as the federal government fully reimburses the provincial government for HST. It would be dishonest and misleading to tell the people of the province that the cost of work includes HST when it is money paid back to us. Even in business, any recoverable HST would not be recorded as an expense.

"It is no wonder our province is facing a serious financial situation when it is obvious the former premier does not even know the rules under the province’s Financial Administration Act," said Minister Sullivan. "This is another desperate attempt by the Opposition to distance themselves from the financial mess they created. They refuse to believe they knew the true circumstances of the province’s fiscal situation. In fact, they created the problem and it is now up to this government to correct the situation."

Media contact: Diane Keough, Communications (709) 729-6830

2004 02 13                                        12:45 p.m.

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