Government’s dismissal of Crown corporation’s board indicates NDP is paying attention to Alberta’s ABC sector

Posted on June 14, 2016, 2:02 am
7 mins

PHOTOS: Alberta Agriculture Minister Oneil Carlier seen walking through an angry crowd of Bill 6 protesters last fall, chatting with participants. Below: Brad Klak, suspended president of Alberta’s Crown-owned Agriculture Financial Services Corporation, and former AFSC board member and Tory agriculture minister George Groeneveld.

Yesterday’s government news release is short and to the point. But it grabs a reader’s attention like a cannon shot across the bow.

A lot of people in Alberta government agencies, boards and commissions – the so called ABC Sector – will be paying close attention to the contents of this news release and the news stories about it that are likely follow. The attention indicates the NDP government of Premier Rachel Notley is paying attention.

KlakMug“The Board of Directors of the Agriculture Financial Services Corporation has been dismissed after an examination into senior executives’ expense and procurement practices,” the official statement begins.

AFSC, in case you’ve never heard of it, was until yesterday a provincial Crown agricultural lending and insurance corporation run by a private-sector board of directors. Among its better known services are crop insurance and hail insurance.

“An examination, spurred by an anonymous tip, uncovered problems with senior executives’ expenses and the corporation’s procurement practices,” the news release continued.

This is followed by the official statement’s only colourful quote, by Agriculture Minister Oneil Carlier: “The report’s findings point to a culture of entitlement in the last administration that Albertans firmly rejected in the election, a culture of entitlement that will not be tolerated by this government.”

The examination of the AFSC was conducted by the province’s Chief Internal Auditor. The auditor’s report concluded that, in the words of the government news release:

  • “Some expenses related to travel, meals and hospitality were not necessary for AFSC’s business, and expenses were generally not properly authorized
  • “Senior executives accepted gifts, such as event tickets, meals and golf from vendors, and vendors covered costs related to AFSC corporate events
  • “For more than half of the vendors examined, AFSC’s requirements for fair, open, competitive or transparent procurement processes were not met”

GroeneveldMug“The Auditor also recommended that a further human resource investigation be conducted to consider appropriate disciplinary action against the implicated senior executives,” the release said.

On page 7, the report recommended “disciplinary action be considered against” the president and managing director, the Chief Operating Officer, and the vice-president, innovation and product development.

The 20-page report identifies expenses “that were not clearly reasonable or necessary in performing work duties,” including limo trips for senior executives from Edmonton to Central Alberta and return to attend Christmas parties, more than $5,000 for a dinner in Japan for the president, managing director and an associate at which it is unknown if anyone else attended, and close to $20,000 spent on a share of Oilers luxury boxes for 10 games in 2011. (Page 11.) There were also more than $12,000 in Starbucks gift cards purchased between 2012 and 2015. (Page 12)

The news release said the report has also been handed over to law enforcement officials to investigate.

While news reports said Mr. Carlier did not provide their names, the three executives suspended with pay are clearly identified by the AFSC website as Brad Klak, president and managing director, Merle Jacobson, COO, and Wayne McDonald, VP innovation.

Mr. Klak, who is paid $670,000 a year, is a former executive assistant to Ernie Isley, who was minister of agriculture under premiers Don Getty and Ralph Klein.

The corporation’s dismissed six-member board of directors was made up of Mr. Klak, George Groeneveld, Dean Gallimore, Harold Schmaltz, Patrick Bieleny and Ian Reynolds, who are also named on the corporation website.

Mr. Groeneveld is a former Conservative MLA for the Highwood riding south of Calgary and minister of agriculture under premier Ed Stelmach. He told a Postmedia reporter he thought he was being singled out because he was a former PC MLA. “I just hate to see something political affect my fellow board members and indeed some of the staff,” he told Postmedia.

In the same Postmedia story, PC interim Leader Ric McIver accused Mr. Carlier of taking part in an effort to “throw political mud.”

The dismissed board has been replaced by the government with a three member interim board made up of senior Government of Alberta employees.

Ed Knash, agriculture VP with government-owned ATB Financial, was named as interim CEO. Interim Board chair is Bev Yee, deputy minister of Agriculture and Forestry.

The last time the government of Alberta did something like this with an appointed board was on June 12, 2013, when Conservative Health Minister Fred Horne fired the board of Alberta Health Services for refusing his order to tear up legal contracts with senior AHS executives in an effort to save the government of premier Alison Redford political embarrassment.

Eventually, the Tory government was forced to admit the AHS board was right and pay up what it had agreed. But AHS was run thereafter by a single administrator appointed by the government until the NDP took over and restored board governance to the province-wide health service in October 2015.

The NDP will take a different approach with the AFSC board. Yesterday’s news release said the search for a new AFSC board in which the government can have confidence will begin at once.

This post also appears on Rabble.ca.

12 Comments to: Government’s dismissal of Crown corporation’s board indicates NDP is paying attention to Alberta’s ABC sector

  1. Alvin Finkel

    June 14th, 2016

    I have to shake my head at the efforts by the Tory hacks living off the fat of the land at taxpayer expense to label their firings as “political.” Perhaps they are but not in the sense that these pigs at the public trough are claiming. They are not being fired because they are Tories but because they demonstrate no respect for taxpayers’ money, acting as if everything is coming to them. Well, perhaps I’m splitting hairs: that is how Tory politicians and hangers-on have always behaved in this province and so the NDP government may not find a whole lot of appointees from the previous government to various agencies who conduct themselves with the frugality that working stiffs expect from those whom their tax monies support. It is unfortunate that many people however are unable to distinguish between these fat cats, who don’t have real jobs, and real civil servants and government employees who do have real jobs, make normal incomes, and don’t have expense accounts. The government needs to make that point as clearly as possible so that firings of executives who were part of the Tory ruling class, in turn intertwined with major big business interests, do not become fodder for Wildrose crapola about overpaid government workers.

    Reply
  2. Public Servant

    June 14th, 2016

    Tory hacks gravy train derails.

    Reply
  3. political ranger

    June 14th, 2016

    It’s about time, finally. Long, long overdue.
    Unfortunately these events, which should be happening regularly, will be few and far between because the audits and examinations are being conducted by the in-house Auditor. He’s only one guy and how big is the population of ABC in this province!
    Let’s spend a few million and audit the whole lot, in the next year. Despite Mr. Finkel’s protestations above, the government ministries would benefit greatly from a thorough review as well.
    I can see a boom time in the paper shredding business.

    Reply
    • Expat Albertan

      June 14th, 2016

      That last part is easy – even one bag of shredded paper should be considered an admission of guilt, and thus, grounds for dismissal. Better yet, it might be easier to assume guilt, sac the lot, and start fresh (although they’d have to stagger the sackings, to maintain normal operations).

      Reply
  4. Bob Barnetson

    June 14th, 2016

    Talking to Don Braid, fired Board member (and former Tory MLA) George Groenveld says:

    “Look, I don’t think this minister even understands agriculture,” says Groeneveld.

    Given the circumstances (i.e., wildly inappropriate spending, questionable contracting processes, ineffective Board oversight), Groenveld’s completely ad hominem attack on Minister Carlier is stunning in its cluelessness and gives us a pretty good sense of the level of entitlement among Tory appointees.

    Much looking forward to **much** more house cleaning by the NDs.

    http://calgaryherald.com/news/politics/braid-bombshell-allegations-at-a-farm-agency-run-by-pc-appointees

    Reply
    • Tom in Ontario

      June 14th, 2016

      Sadly for Mr. Groeneveld, Stephen, King of Political Hack Appointments, Harper is not in charge in Ottawa. George sounds like a perfect candidate for the Senate. He’d fit right in since he’s no slouch when it comes to spending taxpayer money. But the news isn’t all bad. Judging by his comment, he likely has much to offer the Canadian people in the field of agriculture.

      Reply
    • Maria

      June 14th, 2016

      perhaps the Minister does not understand agriculture as Mr. Groenveld claims, but it is good enough that the Minister can spot pigs at the trough. I look forward to hearing more government announcements like this and agree with Political Ranger that money should be invested to identify other troughs.

      Reply
  5. Athabascan

    June 14th, 2016

    Good start.

    I’ll be a lot more impressed if and when the NDP finally clean up the porky pigs at the trough who are gorging themselves at Athabasca University.

    That job is nowhere near completed or even under way.

    Reply
  6. Dave

    June 14th, 2016

    Shouldn’t Conservative appointees to various boards have been conserving government expenses? All they were conserving is their own entitlement attitude.

    Reply
    • Athabascan

      June 15th, 2016

      You are missing the point of neocon ideology. The point is to deny everyone else by claiming to be fiscally conservative, and by doing so it allows more funds to be sepnt on friends and themselves.

      Conservatism is a system designed to hide basic selfishness while labelling everyone else as moochers.

      Reply
  7. rbeason

    June 14th, 2016

    As a small c conservative I am happy with the NDP Government’s action on this front. It has been simmering for quite a while on the back burner among good government folks for some time.

    Reply
  8. David

    June 15th, 2016

    Perhaps the current agriculture minister does not understand as much about agriculture as the former PC agriculture minister, but it seems at least he can recognize pigs at the trough.

    Reply

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