June 29, 1994

PUBLIC ACCOUNTS

COMMITTEE

The Committee met at 9:30 a.m.

MR. CHAIRMAN (Windsor): Order, please!

First of all I would like to welcome everybody here

and explain the purpose of these hearings. The Public Accounts Committee, of

course, is the Standing Committee of the House of Assembly with a mandate and

responsibility to examine the public accounts and to enquire into particularly

those matters referred to in the Auditor General's Report, matters of concern

brought forward by the Auditor General and her staff, and such matters as

referred to us by the House of Assembly or that the Committee itself might see

from time to time and decided it is within the area of responsibility of the

Public Accounts Committee to enquire into. We are not bound by anything but we

generally in large measure follow the Auditor General's Report and some concerns

raised there, which is the case today as it relates to this particular school

board.

The Committee is neither judge nor jury. We are not

here to pass sentence or anything else. We are here simply to receive evidence

and report later on to the House of Assembly in due course. As I say we are the

final step in the accountability process I guess, and thereby all of us are

accountable to the taxpayers who pay the bills and the House of Assembly, of

course, is responsible. The arm of the House of Assembly reaches out and enquire

into matters that may be of some concern, or of which concern has been

expressed.

This is basically an extension of the House of

Assembly and we follow the same rules. You will see microphones before us and

everything is being recorded. Mr. Oates at the far end is in charge of the House

of Assembly recording and everything is transcribed by Hansard so there is a

full record available to you as well. It is a public document and everything is

recorded and transcribed verbatim as in the House of Assembly. The only

difference in this and the House of Assembly is that we relax a little bit and

feel free to take off your jacket, as I have done, when it gets too warm. We are

not quite as formal as we are in the House of Assembly. We will have a coffee

break a little later but if you wish to go to the washroom or go get a drink of

water by all means feel free to do that. We try to operate in a fairly relaxed

manner although obviously the matters before us are of some importance.

I would like to introduce the members of the

Committee. To my far right Mr. John Crane, MHA for Harbour Grace, Mr. Alvin

Hewlett, for Green Bay, and Mr. Oliver Langdon, for Fortune - Hermitage. Third

down to my left, Mr. Glen Tobin for Burin - Placentia West, Mr. Melvin Penney

for Lewisporte, and Mr. Danny Dumaresque for Eagle River, and Neil Windsor, of

course, for Mount Pearl. To the end of the table Ms Elizabeth Murphy who is the

Clerk of the Committee and Deputy Clerk of the House of Assembly, and Mr. Martin

Noseworthy who is the research assistant to the Public Accounts Committee. He

keeps us all straight and organizes all these things for us.

The Auditor General is with us today. I am pleased

to have Ms Marshall and her staff back. Would you like to introduce the people

who are with you today, Ms. Marshall?

MS. MARSHALL: Thank you, Mr. Chairman.

To my immediate right is Mr. Bill Drover, Audit

Principal with the office and to my immediate left is Mr. George White, Audit

Manager with our office.

MR. CHAIRMAN: Thank you, very much.

We certainly welcome Pastor King, Chairman of the

Board of the Pentecostal Assemblies of Newfoundland. We welcome you this morning

and perhaps you would introduce the people who are with you?

PASTOR KING: We have Don Wilkins who is our

Superintendent and Robert Paddock who is our Office Manager and accountant.

MR. CHAIRMAN: Thank you, very much.

We also have from the Department of Education Mr.

John Berniquez who always seems to appear whenever matters of the Department of

Education are being discussed. We certainly welcome his presence and from time

to time his participation. I see Mr. Kevin Manuel here as well as an observer, I

assume. I am not sure if you are here in an official capacity or as an

interested observer.

MR. MANUEL: Merely an observer.

MR. CHAIRMAN: Merely as an observer. And who is

the gentleman with you?

MR. MANUEL: John Brace.

MR. CHAIRMAN: You are both very welcome indeed.

These are public meetings, of course, and you are entitled to be here. There are

no news media here. They had indicated they would be here yesterday and today

but so far they have not shown up so we do not have to worry about news media

this morning.

Let me say to the witnesses particularly, as I

mentioned, everything is being transcribed. I would appreciate it if you would

speak into the microphone when you're speaking and if I fail to identify you

each time you speak would you identify yourself for the benefit of the people

back in Confederation Building who have to transcribe this and who won't know

who's speaking. We can get away with it ourselves because they're used to

hearing us, unfortunately for them.

First I'll ask Ms. Murphy if she would swear in the

witnesses. Again, everything here is done under oath. The Auditor General and

her staff of course have been previously sworn.

SWEARING OF WITNESSES

Robert Paddock

Roy King

Domino Wilkins

MR. CHAIRMAN: Thank you very much. We'll now

begin, I'll ask Mrs. Marshall if she would like to have some opening remarks to

introduce this particular topic being the audit of the Pentecostal Assemblies

Board of Education. Mrs. Marshall.

MS. MARSHALL: Yes, thank you, Mr. Chairman.

My office commenced the audit of the Pentecostal

Assemblies Board of Education during April of '93. The audit was directed

primarily to the systems and transactions relating to management practices,

capital assets and purchasing. In addition, we reviewed the boards systems and

transactions relating to human resource management and also pupil

transportation. I note, this is the first time that we reported on the area of

pupil transportation for a school board.

As a result of our audit, in the area of management

practices, in general we found that management practices of the Board could be

improved. In particular, operational planning and reporting could be improved

with the development, approval and monitoring of operational objectives. The

financial management area would also be strengthened with the development of a

financial management manual and with increased reporting on financial matters.

We also made some recommendations regarding human resource management.

In the area of capital assets we found that adequate

physical controls do not exist over capital assets. Capital asset ledger isn't

maintained, physical counts aren't performed, items aren't physical identified

and formalized policies and procedures have not been developed.

In the area of purchasing we found that policies and

procedures to ensure adequate monitoring and control over the acquisition of

materials are not clearly defined and communicated to staff. Numerous instances

of non-compliance with the public tender act were noted.

In the area of pupil transportation, we noted that

there's insufficient direction in the control and management of the pupil

transportation system. Written policies of procedures are not provided to the

staff by the board. Thank you, Mr. Chairman.

MR. CHAIRMAN: Thank you Ms. Marshall.

Mr. King would you like to make any opening comments

to the board?

PASTOR KING: Mr. Windsor, we appreciate being here

this morning and this is a new experience for me after being on the board for

forty years, so to capsulize forty years of experience coming from fish loss to

what we have and being scrutinized over these matters this morning. I appreciate

the fact that, within my own thinking, an appreciation for the accomplishments

of the board and those who have served on the board all these years, that we've

done very well - and I am sure that there's always room for improvement - and in

no way have we adversely set out to act in defiance of any rule or regulation

that has been set forth by government. Specific answers to specific questions I

would rely upon Mr. Wilkins to give you the answers, Sir.

MR. CHAIRMAN: Thank you very much. Let me say that

we've found, in our experience as a Committee, it's only in the past three years

in fact that Crown corporations, boards, agencies and other government funded

bodies have been scrutinized by the Public Accounts Committee. Without exception

we've found in all the boards and agencies that we've examined - I don't think

we've found any cases of deliberate defiance of the act. Many times it is a lack

of real understanding of just how the Financial Administration Act or the Public

Tender Act fully applies to anything that includes spending taxpayers' dollars.

The fact that a board or agency gets a grant, it may be a lump sum grant,

nevertheless that board or agency is responsible to account to government for

that funding, and government through the House of Assembly to the people of the

Province.

From government's point of view we in Opposition make

sure they account for it in the House of Assembly and I guess as a select

committee of the House we are all responsible in that area. That is the role we

are here to play. Not to point fingers but simply to examine areas. In many

cases some of the things that are commented on by the Auditor General you may

well disagree with, and that is your right. As I've said before, we don't always

agree with the Auditor General's opinions. An Auditor General's report is an

opinion of the Auditor General and her staff. As good as she is she is not

perfect.

We don't hesitate to disagree with her, now you may

want to clarify, to explain perhaps, what is said in the report. It can be put

in a different light by your responses here today. That is what we are here for

and we appreciate the approach that you are taking in that regard.

Perhaps we will proceed with the questioning. Where

will I start? I will start today with Mr. Tobin, on the far left.

MR. TOBIN: Mr. Chairman, thank you very much. I

have a few questions as it relates to the Auditor General's report dealing

specifically with the Public Tendering Act. It appears that there are no formal

procedures set up by your board for the public tendering act and as a result of

that they indicate that in the Auditor General's view 9 of 10 purchases over

$5,000 did not go to public tender. I am wondering if the board has since

rectified that. What plans have you put in place in terms of policies and

procedures to be followed in the future?

MR. WILKINS: Mr. Chairman, in this document I

believe - I'm trying to find it now - we did set forth procedures -

MR. CHAIRMAN: Page 21.

MR. WILKINS: Page 21. That were approved by the

school board and have been communicated to our staff to correct that concern

that was raised by the Auditor General. There are some specific procedures that

have been approved.

MR. CHAIRMAN: Actually we have page 23, the boards

response.

MR. DUMARESQUE: On page 149 is the purchasing

policy of the school board.

AN HON. MEMBER: (Inaudible).

MR. DUMARESQUE: Yes, that is page 149 and 150 and

MR. WILKINS: Mr. Chairman, page 148 of your

report. Purchasing polices and procedures were approved January 1, 1994 and they

deal with purchasing as per the Public Tendering Act, the Provincial Preference

Act, and the Provincial Preference Regulations. What we have tried to do is to

activate the recommendations of the Auditor General. There is quite a number of

them as you see from our response. Even when we got the draft copy of the

Auditor General's report we put some things in place. Since we've gotten the

final copy we've put other things in place and one of these, to answer the

gentleman's question, were purchasing policies and procedures that were approved

by the board January 1, 1994.

MR. TOBIN: In the Auditor General's report I noted

that there was $19,097 spent on windows and the board's response that there was

only one supplier in the area. Was that a special type of window you were trying

to purchase, because there would be...

MR. PADDOCK: No sir. That was a number of invoices

for a number of windows for a number of sites. It was not one specific job.

MR. TOBIN: So it was not a lump sum purchase in

one payment, it was a variance of items and numbers less than $5,000. What you

are saying then I would guess is that the way you purchased it did not

contravene the Public Tendering Act?

MR. PADDOCK: Repeat that, sir.

MR. TOBIN: I said, what you are saying then is

that the method you use to purchase this material which is for different schools

in different places, while the lump sum total is $19,000, it was not one item or

one quote that you went out and got for $19,000 -

MR. PADDOCK: No sir.

MR. TOBIN: - so you feel you did not contravene

the Public Tendering Act with the numbers of purchases that you made, which came

to a total of $19,000?

MR. PADDOCK: No sir. Some of those were because of

broken windows or broken doors and may have been an emergency. I don't know the

specific invoices here but we have thirty-nine schools and those purchases may

be for five, six or eight of those schools, and it may have been due to

vandalism; they may have been due to, you know, doors getting broken going in

and out but it was not a specific purchase of windows to refurbish the school.

MR. TOBIN: There is another issue that was raised

and that is the purchase of fuel for your maintenance program. I understand the

board does not go to tender for that; is that correct?

MR. PADDOCK: When we started in 1969, we had

50-odd schools and they were buying from everywhere, so as an office, we tried

to gather this together and come up with a price for all of the schools. At that

time, there was only one oil company in the Province that could service all our

schools in Newfoundland and Labrador so we went with them; in the 70s we would

go back and negotiate, we would talk with other oil companies in our area - You

will have to excuse me, sir, because I am not a public speaker.

MR. CHAIRMAN: You are doing very well, Mr.

Paddock.

MR. PADDOCK: - so what we would do was, go and

check with Irving Oil and Ultramar and they said: look, we can do some of your

schools but we can't do them all, so would you want to piece out so many in the

Grand Falls area, so many in the Stephenville area? And we said: well no,

because by farming it out like that, we get less volume and again, Imperial Oil

would give us the best price; periodically we would do this, and we would check

with the other school boards in the area who were centralized within a

sixty-mile radius of their school board's office, to see that we were not paying

more for all our oil for the Province, as they were paying. The same volume in a

small, compact area.

Now in the last couple of years, I notice the

government is tendering for this oil and already we have gone with the Ultramar

in Labrador and getting the central purchasing, but we are looking at when our

understanding expires in the fall, of following suit and going with them. Now we

will get the same price that government has had because the volumes will be

there for all boards.

MR. TOBIN: So it is a matter of someone being able

to provide the service to all of your schools to stretch to rural parts of this

Province; that's was the plan you went with in the first place?

MR. PADDOCK: Yes, sir.

MR. TOBIN: Okay, I am finished, Mr. Chairman, and

will pass on to someone else.

MR. CHAIRMAN: Thank you, Mr. Tobin. Mr. Penney?

MR. PENNEY: Thank you, Mr. Chairman.

The Auditor General has made reference to what are

perceived to be problems in the transportation area. She mentions that not all

of the transportation costs are listed in the financial statements, and as you

can appreciate, it makes the task that much more difficult to do an assessment.

Of the 4,000 pupils whom you bus, over half of them would not be recorded in

your financial statements; why would this be?

MR. PADDOCK: We probably call tenders for about

half of those students. The other half is covered by a NorPen school bus system.

This is a separate group set-up outside the Pentecostal and Notre Dame

Integrated School Boards and operate under the Notre Dame school board office,

so these were not recording in our records, and the same thing in the Grand

Falls - Exploits Valley area. The Exploits Valley school board does the bussing

for the Pentecostal, R.C., and Integrated students from Buchans to Point

Leamington, and there are probably 1,000 of our students being bussed here, but

these are shown on the records of the other school board; however, I think we

have addressed that by including in the financial statements this past year that

there are other costs which are not included.

MR. CHAIRMAN: Mr. Penney?

MR. PENNEY: Of the thirty-seven route contracts

that you have, only seventeen of them go through the public tender process; the

other twenty do not. That appears to be a breach of the public tender contract.

Can you explain to us why this is happening, why twenty of the contracts are not

tendered? How long has this been happening? How long have we had twenty of these

routes done without going to public tender?

MR. PADDOCK: Sir, these did go to public tender;

however, the document or the contract signed was a renewable contract approved

by the Department of Education, and each year we go back. If the contractor

doesn't want an increase in his rate, if the route hasn't changed, then we will

go to the Department of Education for approval based on that and they, in turn,

will - or have - approved it up to this point. There has never been a question

that there was anything wrong. It was a renewable contract, renewable year by

year and stated specifically in the contract.

MR. CHAIRMAN: For how many years?

MR. PADDOCK: Indefinitely.

AN HON. MEMBER: And this was departmental policy?

MR. PADDOCK: It was, but since 1987 or 1988 they

have changed it, and now you either sign a three-year, two-year, or one-year

contract which can be renewed for three years, two years, or one year; but the

other ones that we have, which you say approximately twenty, these are still in

effect, and unless the department wants us to cancel them and call tenders, we

probably have no desire to do so unless we are contravening

an act.

MR. CHAIRMAN: Perhaps I could ask Mr. Berniquez,

could you take the microphone, Sir? Could you enlarge on departmental policy on

that, because it clearly appears to me, at least, to be outside the ambit of the

Public Tender Act.

MR. BERNIQUEZ: Mr. Chairman, as far as I know, and

I am not that familiar with this transportation area, but our transportation

people basically approve these contracts every year. I assume that when these

contracts were awarded it was in conjunction with public tender and it was felt

that by having these renewable contracts it would basically constitute getting

the lowest price for that transportation, but I will take it under advisement to

speak with our transportation people to find out if we have actually consulted

the Department of Justice to see if this would be in violation of the act,

because an indefinite renewal certainly seems to exclude other suppliers from

getting contracts for perhaps even lower prices. So I will certainly take that

up with our transportation people and find out what the situation is.

MR. CHAIRMAN: I think it is an area that needs to

be looked into, because I am aware that many of the school bus contracts are far

cheaper today than they were ten years ago. It makes me wonder how much money

these operators were making ten years ago, I am aware and have some personal

knowledge of that.

AN HON. MEMBER: Certainly in terms of an

indefinite renewal.

MR. CHAIRMAN: Perhaps the Auditor General would

like to comment on the Public Tender Act, but it's my view that an indefinite

extension is certainly outside the Public Tender Act.

MS. MARSHALL: Yes, that is my opinion, too, it is

outside the intent of the Public Tender Act. We did have discussions with the

Government Purchasing Agency on this issue and they were of the same opinion as

ourselves that to have a contract for an indefinite period of time was not the

intention of the Public Tender Act and they recommended the re-tendering.

MR. CHAIRMAN: That follows my understanding, you

can have a contract which is a three year term with a one year renewal or a two

year renewal but not in that way. This area needs to be looked into. Mr. Penney

I didn't mean to interrupt you. I've taken over your lead there.

MR. PENNEY: That's fine. A couple of specifics

that the Auditor General picked up, I'll just throw them out to you for

clarification, the Auditor General noticed that there were two cases where the

carriers were overpaid because changes in their route had not been picked up.

Are you aware of the cases to which I'm referring?

MR. PADDOCK: Yes, Sir.

MR. PENNEY: Would there be any other cases

similar? Would these be the only two circumstances?

MR. PADDOCK: Yes there was, Sir.

MR. PENNEY: Could you explain what happened?

MR. PADDOCK: One of them was for a small contract

contracted with an individual to transport kindergarten students home at noon.

It was on the Northern Peninsula and the original contract went to a specific

community. In the following year the contract was extended to go to that

community plus another one so there was $1,000 added. We asked our schools if

the contracts were still in effect for the coming year and one of our schools

neglected to tell us that one of the routes had been dropped until later in the

year and we reclaimed the money before the year was out.

MR. PENNEY: What was the overpayment? How many

dollars?

MR. PADDOCK: It was a portion of $1,000 -

MR. PENNEY: And it has been recovered?

MR. PADDOCK: - that would have been applicable for

the number of months that it had gone and it was recovered, yes.

MR. PENNEY: Okay. Another example was a quote from

the book that you have there on page 27, the third paragraph from the bottom,

the Auditor General states: "We note that one route which was contracted in 1986

at a cost of $7,750 was renewed in 1992 for one kindergarten pupil. The route

involved a one way trip from the school to the pupil's home and covered a

distance of 25 kilometres." Could you elaborate a little bit on that for us?

Could you explain? Well first of all why was it only one way?

MR. CHAIRMAN: Mr. Paddock.

MR. PADDOCK: Why it's only one way? The

kindergarten students can come in on a regular bus but at noon their day ends,

that's why.

MR. PENNEY: It seems a lot of money just for one

student.

MR. PADDOCK: It may be, Sir, there may have been

four, five or six students when it started but it dwindled down to one.

MR. PENNEY: Is that system still in place today?

MR. PADDOCK: That route is still there whether

it's one student or more I couldn't tell you at the moment, Sir.

MR. PENNEY: At the same cost?

MR. PADDOCK: Yes.

MR. TOBIN: Mr. Chairman, if I could just interject

MR. CHAIRMAN: Mr. Tobin.

MR. TOBIN: I'd like to ask the Auditor General a

question if you don't mind?

AN HON. MEMBER: No problem.

MR. TOBIN: I'd like to ask the Auditor General,

why would she see that as a concern? It states that it was - well it looks like

a lot of money - the route was contracted out, I guess, legitimately and under

the act the school boards have the right to bus their children to their schools

if the children want to go. Why would you complain about the contract being duly

awarded?

MS. MARSHALL: It isn't just the isolated contract

that I want to bring to the attention of the House. Route monitoring and control

is a very important element of the transportation system. The point I'm trying

to make is that the school board needs to improve their route monitoring. There

is very little done in this area and the Department of Education also has done

very little in route monitoring and control, and our audits of the school board

is indicating numerous examples like this; this is just one or two examples but

there are many, many examples like this.

The cost of bus transportation for Newfoundland is in

the range of $30 million, which is a significant amount of money and my feeling

is that neither the school boards nor the Department of Education is giving

sufficient attention to this area, and I am trying to quote examples to

demonstrate that this is an area that should be looked at; I mean, is this the

only option available, have other options been explored, and if they have, you

know, has the school board looked at it, has the Department of Education? Are

they satisfied that this is the only option available and that this is the

cheapest option available?

MR. TOBIN: This is not just left to one school

board. This could be going on in every school board in the province.

MS. MARSHALL: Well what we are finding is this is

common in all school boards that we are looking at. While I could make a generic

statement that there needs to be more monitoring and control, what I find is

that people can't really relate to it unless you give specific examples, and you

know, there are numerous, numerous, numerous cases like this which arise in the

course of our audits, and my question to the school boards and also to the

Department of Education is, are you aware of this, and are you satisfied that

the system in place is running?

MR. TOBIN: So this is geared more towards the

Department of Education than towards the Pentecostal School Board.

MS. MARSHALL: No, it is geared towards both of

them. I think that the board has a role in this to make sure that the system is

operating properly, that people are monitoring and controlling it and are using

the cheapest alternative possible, but I also think the Department of Education

should be going out to the school boards and taking a look at what they are

paying for these bussing services. The Department of Education is almost

subsidizing this to the tune of 100 per cent and my understanding is that the

department's officials very rarely go out to the school board. I don't think

your school board has seen an official from the department to look at this area

in many years, and it is a significant amount of money; it is $30 million and I

think that there is room there for some savings.

MR. PENNEY: Mr. Berniquez, I think it would be

only proper that you comment.

MR. BERNIQUEZ: Yes, sir.

MR. CHAIRMAN: Mr. Berniquez.

MR. BERNIQUEZ: Mr. Chairman, this is an area in

which the Department of Education has been active over the last year, in terms

of visiting school boards and examining their transportation routes and trying

to find ways to do it cheaper.

Of course, the department only has two positions

devoted to transportation and with those kind of limited resources it is very

difficult to handle twenty-seven school boards over the problems immediately,

but we do recognize that there are savings in transportation and you know, we

have been more active over the last year. In the particular case, the example

that we are looking at here, I can only assume that we gave the approval for

this to continue because it was felt at the time that this was the cheapest way

to do it, but we do recognize that in the whole area of transportation, we need

to be more active and we have been over the last year and will continue to be

so.

MR. CHAIRMAN: Thank you, Mr. Berniquez. Mr.

Penney.

MR. PENNEY: I would defer to my colleagues but

before I do I would like to make it clear to Mr. Paddock and to the other two

gentlemen, that my question was not meant as an interrogation; I was just

looking for clarification, so please, don't misinterpret my question as being an

accusation. It was not meant in that manner at all. Thank you, Mr. Chairman.

MR. CHAIRMAN: Thank you, Mr. Penney. Mr. Crane,

would you like to carry on?

MR. CRANE: Yes. On page 125 of the report there is

one travel item of $72,646, what would make up this amount and another one

there, Board Meeting Expenses: $29,625?

MR. PADDOCK: The travel, $72,000, involves the

office travel for the superintendent, four assistant superintendents, and the

business manager. Which with our district, from the whole Province and

Labrador...

MR. CRANE: Yes.

MR. PADDOCK: The $29,000 is to cover our board

meetings expenses. Again, our board members are from the whole Province and

Labrador. We try to meet six to eight times a year, and then there are executive

meetings. One board meeting could cost $3,000, $4,000 for our particular school

board. Some compact boards have members living within an hour, ours are all over

the Province.

MR. CRANE: You are right on there. On page 69, it

is under travel. Travel in 1990 was $53,000 and in 1993 it was up to $72,646.

Like you just said you travel all around. But you were doing that in 1990. It is

up 36 per cent in the space of three years. Even though I know everything is

increasing maybe except wages but in a time of restraint 36 per cent over three

years seems to be -

MR. PADDOCK: What page?

MR. CRANE: Page 69.

MR. PADDOCK: Page 69? In 1990 you say it was

$53,000. We were probably less one assistant superintendent at that time. That

may account for part of it. Sir, if I had known the question I could have

researched the reasons.

MR. CRANE: Yes, okay.

MR. CHAIRMAN: Mr. Wilkins?

MR. WILKINS: Mr. Chairman, Mr. Crane, I would like

to speak to that item. I think there are a couple of reasons for that increase.

One is they had a new superintendent and he may have been more expensive.

SOME HON. MEMBERS: (Inaudible).

MR. WILKINS: The reason is, sir, as a

superintendent I felt that my duty was to get to every school in our district

and the previous superintendent didn't do that. I have an objective of

travelling to every school in our district at least once a year. That costs more

money than if you go once every two years or once every three years. I felt to

keep in touch with the operations as a superintendent I had that duty. I talked

to the school board about it and they agreed to it. That meant an increase in my

travel.

The other thing that has caused this significant

increase in travel of both myself and the assistant superintendents is the

restructuring that is going on in the Province and the response to the royal

commission. Our school board felt that our constituency should be fully involved

with an understanding of the royal commission, so we held meetings around the

Province in the past couple of years, public meetings, on the royal commission,

on Adjusting the Course part one, and some of the politicians who are

present today were at some of these meetings. Of course that costs money.

We've done a lot more travelling because of that

restructuring and my personal agenda of travelling more throughout the district.

I think that probably explains the significant increase in travel.

MR. CHAIRMAN: Thank you.

MR. CRANE: On page 91, Trade Payables increased

from $11,000 in 1991 to $118,000 in 1992. That seems to be a significant

increase.

MR. PADDOCK: Again, sir, that really doesn't mean

too much. Because at the end of the year in one year we may have gotten all of

our bills paid where at the other year bills came in after June 30, so we would

have to set them up. That really does not make too much difference there. It is

not an overexpenditure.

AN HON. MEMBER: It's a snapshot situation.

MR. PADDOCK: That's all.

MR. CRANE: Okay. It just looked terrible, that's

all.

Page 31, annual returns by the schools to the boards

are not verified. The return forms the basis of the grants to come from the

Department of Education, and does the board agree that this system for

verification should be in place; and if it is not, why isn't it?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: Mr. Chairman, the system of reporting

enrolments in every school district reflects the nature of education in the

Province. There is an annual general return that is provided by the school

principal, and that involves the counting of students at the school. I think the

problem the Auditor General had with it was that somebody from my office, like

an assistant superintendent, didn't go out into the schools and actually head

count every kid in that building and verify that these were the students that

were there.

Now in talking to the Auditor General in a meeting in

November or December, she felt that what was required was the assistants or

myself to go out and talk to the principal to see if, indeed, the figures that

were on the annual general return were appropriate, and not that we would have

to go in and count every kid in the classroom, and that is being done at the

beginning of each year. The assistant superintendents visit the school in each

district, and one of the items on their agenda is talking to the principal of

each school on the enrollment and the differences in enrollment, and the

difference tends to be a downward difference. Unfortunately, there is a decline

in enrollment and that impacts everything we do, teacher allocations, financial

allocations and so on.

So we are concerned about it from that perspective,

and we are concerned about it from another perspective as well, and that is with

respect to student retention. You tend to get your dropouts during the summer,

so we want every one of these tracked and, of course, if they are within the

compulsory school attendance age then they have to be followed up legally and so

on. So that is one of the duties of the assistants at the beginning of the year,

to sit down with each principal and make sure that these figures are correct and

that any students who need to be followed up are followed up by the principal or

the guidance counsellor, if the school has a guidance counsellor, and I believe

that is within the spirit of what the Auditor General required.

MR. CRANE: She is nodding her head, so she says:

Yes, that's it.

Thank you very much.

MR. CHAIRMAN: Thank you, Mr. Crane. Mr. Hewlett.

MR. HEWLETT: Thank you, Mr. Chairman. A question,

I guess, to the board.

Having listened to what has gone on here so far this

morning, and explanations about, for instance, the renewal of bus contracts, the

number of students who might constitute a valid bus route, that sort of thing,

tendering procedures and so on, is it safe to say that prior to the Auditor

General coming in and visiting with you people that you were just basically

carrying on your own merry way and that none of these items, in general at

least, had been brought to your attention as being out of sync with the

Financial Administration Act, the Schools Act, or these sorts of things?

MR. CHAIRMAN: Pastor King.

PASTOR KING: My response to that question would

have to be definitely no. I think we have been very frugal and we are very, very

careful in our records which show that in every area where we would be

questioned on responsibility, jurisdictional responsibility, we endeavour to do

that out of good conscience and the very nature of our philosophy of education.

MR. HEWLETT: I am not sure if I made myself clear.

My point was being that assuming some of these things were in contravention of

various rules and regulations and so on, for the most part was the AG the first

agency to sort of bring this to your attention? I think it was pointed out

earlier here that the Department of Education tended to let these things go,

renewable (inaudible), school bus contracts and so on. So the sort of exercise

we are into here this morning, this is your first time round in this sort of

thing by virtue of a new process, the Auditor General being involved?

Your business activities prior to this, you were

proceeding as best you saw fit, in accordance with your philosophy and standard

business practice and so on?

PASTOR KING: And guided by the Schools Act and the

Department of Education directives. Mr. Wilkins might better respond.

MR. WILKINS: Mr. Chairman, with respect to

transportation, just to take a case in point, that one is on the carpet today,

each year we review the bus routes. We have local school committees operating in

each one of our communities. They are made up of parents and pastors

representing the parent community, and the chairperson of the local school

committee, together with the principal of the school, is required, according to

school board policy, to review the bus routes every year for the school and to

inform us of any changes and, for the most part, that is done regularly, and if

there are changes necessary because there are no students coming from a given

town then we will drop that bus route, or reduce the route and reduce the amount

accordingly, and go back and go to public tender on it.

If there is a need for an extension of a route then

again, in most cases, the route is re-tendered. Of course, we have seventeen of

these now that, as Mr. Paddock said, will be re-tendered at least once every

three years. I guess the objective is to get them all re-tendered every three

years.

AN HON. MEMBER: Thank you.

MR. CHAIRMAN: (Inaudible).

MR. HEWLETT: Yes, some comment was made here

earlier with regard to the restructuring of the education system, etc., and some

meetings, a couple of which I attended, called by Pentecostal groups in my

district, and I was also the recipient of a number of petitions from Pentecostal

parents and what not, that I presented in the House of Assembly, but the bottom

line is, according to the latest news media reports, there is some progress or

whatever being made toward restructuring, also from the point of view of the

board's response to some of the concerns raised by the Auditor General with the

new policies and procedures put in place with regard to purchasing, tendering,

et cetera.

To what extent is our exercise academic today? Will

this school board as we know it now continue to exist in the future, or will

there be some - your board is somewhat unique in that it is Province-wide versus

sort of geographically based in a little region. Will there be a Pentecostal

school board to use the manual that we have in the back of this booklet in a few

years' time or will the denominational aspect of education be accomplished

through some other vehicle? Or is that too early to say, or is it appropriate

for you to say at this stage in the game?

PASTOR KING: It is too early to pose that question

and I don't know that... if I had the answer I would readily give it to you,

sir. Negotiations are going on. What will be the composition of the X number of

boards on tomorrow, we have not finalized that yet.

MR. HEWLETT: Thank you, Mr. Chairman.

MR. CHAIRMAN: Mr. Hewlett, thank you. Mr. Langdon.

MR. LANGDON: I would like to go back to - I think

in the report - but it has to do with the capital assets in your schools which

is in excess of $2 million. It was noted by the Auditor General that up to the

particular time of the audit - I think there is some progress being made now -

that very little of it had been tagged, very little of it had been enumerated.

My concern would be the fact if there was a fire in any one of these schools,

and the fact that none of it was enumerated, none of it had been tagged, and you

didn't know what was in the school. Then at the end of the day would the school

boards go to government, I guess, and with the responsibility for the education

dollars would not know what was in that particular school. How do you address

that? Or have you begun to address it?

MR. PADDOCK: Since the audit, sir, we have reams

of updated asset lists in the school. Prior to the Auditor General's visit we

did have a listing of assets on paper. It wasn't updated each year. If there was

a fire we would have a bit of work to do to go back and find the last list plus

what we had put into it. If there was a fire I guess we would just have to

depend on our old records, new invoices and the memory of our principals and

teachers of what was in each classroom. As you said, we are working on the

listing. It is going to take a long time. It is very complicated. There is a lot

of materials in our schools. With other school boards we are looking at some

programs that are being introduced. I think one board in St. John's probably has

the program. Another board is trying it at the moment.

We don't want to go on our own and do this because

should the boards go together we would like to have something that can come in

from all boards that will be consistent and will be able to tie in with whatever

the central board would do. We are working on it, sir, but I can assure you that

if the school board and the staff between ourselves, between our office and the

principal, I think we can list everything that was in that school.

MR. LANGDON: I taught in a school previous before

being involved in this profession and we had every item in the school listed. It

was at the school board office. Every book was accounted for, and it was updated

each year. It might have been an onerous task at the time but I believe that in

the end it was well worth it. I find it somewhat disconcerting in a sense that

not all of your schools are in a situation where everything has been accounted

and sent to head office.

MR. PADDOCK: They are now, sir.

MR. LANGDON: They are now.

MR. PADDOCK: We have the lists now. We just don't

have them in the computer or tagged, but we do have lists at our office. We have

papers about that high since the Auditor General's report. We are trying to get

some student, some program, to try to get this put on computer. We do have a

listing now, yes.

MR. LANGDON: To probably help to facilitate that

for you, have you contacted the Memorial University School of Business so that

you could get a co-op student to come in and over the three month term might be

able to put that on computer for you?

MR. PADDOCK: We are considering that sir, yes. We

have had -

MR. CHAIRMAN: Would you like to expand on that, I

wonder? Do you have a system of putting tags on major items?

AN HON. MEMBER: (Inaudible).

MR. CHAIRMAN: So you really have no way of

identifying what is your's. What we are finding today not only in schools but in

Crown corporations and agencies, particularly with computers and everything

else, that very valuable property can be very easily displaced. I will not say

removed, displaced, unless you have an accurate system of identifying that and

documenting it.

Also, Mr. Langdon talked about fire, to document your

loss for an insurance claim is very difficult unless you have that kind of an

accurate thing. These are the reasons, I think, why the Auditor General's

Department invariably and almost every agency we have dealt with commented on

the lack of formal documentation of capital assets and the importance of that.

You have $2 or $3 million worth of capital assets here a large percentage of

which probably could be removed, lost, displaced, and you really have no control

over it. I think that is the concern here.

MR. WILKINS: Mr. Chairman.

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: If I could speak to that item? There

are two things. One is the listing of materials, and the listing of materials is

done in the office. The tagging of materials is a separate issue. All of the

materials in our schools are tagged by the schools themselves, the name of the

school is on it. Every book in the library has the name of that school on the

book, every computer has the name of the school stamped on the computer, and so

on. What we are talking about is the tagging of assets in the school through

computer bar code so that it can be computerized at central office.

We have been working with other schools, the business

manager has, on developing an appropriate computer system so that when the

school boards do become restructured there is only a matter of consolidating

that data base, so what we are working on is a computer data base to provide for

the appropriate tagging with bar codes. I think that is the route we should go

in the future and that is the one we are exploring.

The suggestion to get a co-op student from Memorial to

do that is quite acceptable to us. In fact we quite often have co-op students

from Memorial to do things for us, and we will certainly take that under

advisement.

MR. CHAIRMAN: Mr. Langdon.

MR. LANGDON: I have just one more point for

personal clarification on Page 27. You are looking at a busing amount again, a

contract for $20,560 to transport five pupils a distance of twenty kilometres

from home to school in the morning and a return trip home each afternoon. What

would be the boards PLPD coverage in a situation like that where you have the

private operator in a private car? Do you have specifications and so on for him

to be able to operate?

MR. WILKINS: I don't follow your question, Sir.

MR. LANGDON: You have a private contractor

transporting five kids a distance of 28 kilometres from home in the morning and

returned home in the afternoon. I understand it is a private vehicle.

MR. WILKINS: Mr. Chairman, I think I can answer

that question. Yes, we require them to have the appropriate insurance coverage

the same as if they were operating a school bus.

MR. LANGDON: What is the limit of the PLPD

coverage that you would have? Is it $1 million, $2 million?

MR. WILKINS: It is $1 million.

MR. LANGDON: That's it for now.

MR. CHAIRMAN: Just to follow along with that one

if I might for just a second. You talk $21,000 to transport five kids? That is

$4000 per child.

MR. WILKINS: It had gone down to five children but

it was more than five to start with. If you use a private vehicle you have to

ensure that each person you are carrying has a seat belt and has to be delivered

from school to home and not to a bus stop. This contract is now null and void,

and out. We have gone with another company to have this done for us. It had

dwindled down to five and until it got down that low we had to have a bus, but

the department will allow us to now contract for private vehicles with seat

belts and door to door delivery.

MR. CHAIRMAN: It is pretty expensive though for

five children, $4000 per child.

MR. WILKINS: For the bus it would be but I would

say for a taxi it would probably not.

MR. CHAIRMAN: Mr. Dumaresque.

MR. DUMARESQUE: I just want to follow-up on some

questions on the public tendering process. You enclosed a copy of your response

and you have enclosed a copy of the guidelines you are going to follow. Have

there been any instances since you have adopted those guidelines on January 1

where the Public Tender Act has not been followed to the letter of the law?

MR. PADDOCK: These are dated January 1, sir, but

they were not approved by the board until our April board meeting I think, is

that right? We put them into effect and since then we are endeavouring to work

within that; I don't think there is any area where we have not, and what we are

trying to do is find everything under the central purchasing agency that we can;

we are issuing purchase orders with our repairs and maintenance people; we have

made no large purchases, we are calling tenders for anything that we are doing

over $5,000.

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: Mr. Chairman, to follow up on that,

we did not wait until we had the report approved by the school board to put this

into practice. We put it into practice immediately upon receiving the draft

report of the Auditor General, but it was verbal at that point in time until we

had the policies written and approved by the board, and I believe you will find

that for all of the purchases we have followed the letter of the law pretty

strictly since November, in all of our purchases.

MR. DUMARESQUE: Since November of last year?

MR. WILKINS: Yes.

MR. DUMARESQUE: On the fuel, has there been a

contract now, accepted under the public tendering process for fuel, everywhere

in the Province? I notice that the information is that they always purchase fuel

from the same vendor because that was the only one who could deliver fuel to all

the places in the Province including the Coast of Labrador. I know that in

Charlottetown, Labrador, Port Hope Simpson, Labrador are not very big

communities but there happens to be two fuel suppliers in each of those two

communities and I am just wondering -

MR. PADDOCK: I think Ultramar has that contract,

sir, and they are the people whom we have used under central purchasing.

MR. DUMARESQUE: Yes, so you don't do it on a local

basis then, and it is not because that is the only contractor who can supply the

fuel?

MR. PADDOCK: Not at this time.

MR. DUMARESQUE: Okay. It is the same thing for

computers. Now the explanation that I saw there was that the purchase was made

for seventy-five computers and then there were an extra sixty-six, page 22, an

extra sixty-six additional computers and monitors costing over $125,000, and you

said staff was not aware that this purchase should have gone to tender and as a

result purchased these from the same vendor.

It is a bit disconcerting to tell you the truth, that

we would have the Public Tendering Act in place for so long and if $125,000 are

spent of taxpayers money without going to public tender and for computers,

which, you know, in this day and age people are banging on your door with any

number of computers, why would that not have dawned on somebody, and, what

explanation do you have as to why these computers would have gone, if it is

anything outside of the explanation that is there?

MR. PADDOCK: When we called tenders for that -

there were tenders offered by central purchasing agency for computers however we

weren't satisfied with them and they didn't meet our specs. We had numbers of

tenders from numbers of suppliers so we went on the market specifying what we

wanted to put in our schools. We got twenty-one tenders from all over the

Province and the mainland and we brought it down to one supplier. We did specify

at that time that there were sixty or seventy-five - I apologize, I worked with

our - what do you call it Ralph now?

AN HON. MEMBER: Computer coordinator.

MR. PADDOCK: - computer coordinator to do this.

This involved hours of work, thousands of dollars in tendering and then when

this came in and it met the specs, there was nothing in the Province like it

with what we wanted and -

MR. DUMARESQUE: For my information, do you know

what that particular spec was?

MR. PADDOCK: I don't know what it was at the time,

Sir, but what they were expecting in the Province was a lower 386 SX, LX or

something like that and we wanted something that was better. Our guy had been to

half a dozen conferences on the mainland, in the maritimes and this is what we

wanted. We were proven right because some of the things that were bought for

some others had to be replaced. So that's no excuse I know but we just assumed

that we could go on with and buy the extra ones because if we had gone on the

market we probably would have ended up with the same one. We would have paid

thousands of dollars, weeks of time again and would have ended up with the same

but I realize that's no excuse.

MR. CHAIRMAN: Mr. Wilkins do you want to expand on

that?

MR. WILKINS: Yes, Mr. Chairman, two points to be

made on that, the second group of computers that were bought, the prices of

these computers were lower than the central agency price. The second point to be

made is that all of that $125,000 was not public money. The first lot of

computers was totally public money but we have a scheme with our schools whereby

we encourage them to buy some of the equipment locally and they do have access

to local funds. One of the things that you can raise funds for in school are

computers. All parents want their kids to be computer literate and so on. So

given that, we said to the schools: we are going to purchase ten or twelve

computers per school and we would like for you if possible to match that with an

equivalent number that you purchase yourselves. Some of the schools did match it

and did purchase ten or twelve computers themselves.

Now the second order was an order that involved some

more monies of public funds, that's correct, but I would say a significant

portion of that additional order was for computers that were bought by the

schools themselves which they bought through us and that was money they raised

locally and that was not public money.

MR. DUMARESQUE: We have the specs and they have a

386 or 486, basically you're just talking about speed not non-compatibility

which is the big factor I guess but I suppose you know maybe computers are -

maybe not to me because I was educated with them I suppose in university not

that long ago but I suppose for many of the people out in the general public

computers in school boards and others are basically new things. I suppose Pastor

King you haven't embraced them too much yourself, or are not much into it, the

first part of the forty years, anyway.

PASTOR KING: I am one of the unfortunates who got

in there excited about computers; now mine is outdated.

AN HON. MEMBER: (Inaudible).

MR. DUMARESQUE: So probably that is as big a part

of it as any, but when you see that kind of figure it clicks and you want to try

and get it clarified as much as possible.

That was the other part of the questioning, I suppose,

I wanted to check on when you mentioned that some local schools have their own

funding. What kind of discretionary funding would you have as a board, and is

that discretionary funding at the local level? What kind of decision-making

process is involved in the expenditure of discretionary funding?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: Mr. Chairman, the amount of

discretionary funding that a school board has is very limited. A lot of the

funding is earmarked for various purposes, and when you do up your budget you

know what the heat and light is going to be, so you earmark enough in your

budget to cover the heat and light for the year.

Now the area of teaching supplies would be

discretionary funding that would be passed on to the schools, because they have

a right to decide what teaching supplies they want, chalk, overhead projectors,

various things they can buy, library books and so on, so we give them a grant

each year, a per pupil grant, so the greater the enrollment of the school, the

greater the amount of discretionary money that particular school would have.

Now all of the purchasing is done through central

office in that we can capitalize on bulk purchasing and so on by doing it that

way, of course, but they have the discretion with respect to how they spend the

funds, each school does.

The other discretionary funding that the schools would

have would be profits from canteens, and in a large school that could be $10,000

or $12,000 a year, and monies contributed by our churches, and there are

significant sums of money contributed by our churches each year, and if it is

capital it is earmarked for their particular school; it is always earmarked for

a particular school, the school that the church is involved in. For example, in

this town here, in Grand Falls - Windsor, we have a high school, Bursey

Collegiate, and every year the churches contribute to the operation of that

school $15,000 or $16,000. Now that goes directly to the school and is spent by

the administration and staff. They have to report three times a year to the

local school committee their finances, so there is an accountability there.

These reports also come to our business manager, and at the end of the year

there is a final year end report on all funding that is at the local level, like

your canteen and church monies and so on.

Now also at the district level we have monies that we

get from churches. If it is capital monies, of course, it is earmarked for

particular projects so it is spent for these projects, and that would be true of

the Windsor church/school complex that is being built here in town. The church

has put $1.5 million into that particular building.

The churches here are also paying for a salary unit.

The churches will give us monies for a salary unit; the way that operates is the

teacher is on the government payroll, just the same as every other teacher, and

three or four times during the year we will get an invoice from the payroll

division of the Department of Education for the gross salary of that individual,

and we will forward to the department then the monies to cover that salary. So

that's kind of how we operate with respect to discretionary funding.

MR. DUMARESQUE: Okay because, you know, we've had

school boards here before the public accounts committee in the past and it

certainly always has been brought up to me as a member and I'm sure to my

colleagues, where kids go door to door in a number of cases selling their

chocolate bars, cookies or whatever. Do you, the school board, practice that and

if you do what happens to these funds? We have heard of instances where there's

different fees, locker fees and other things and I know some school boards are

reluctant to give us the kind of accountability for what happens locally with

these funds. I guess basically what I'm saying is that there's certainly a

number of people in the general public that are sceptical about the necessity of

having these door to door campaigns for raising funds through these types of

things that I'm saying and is that - what would your assessment be of that

aspect?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: Mr. Chairman, with respect to the

necessity of fund-raising that's I think part of your question. If you're going

to enrich the curriculum as we feel it should be and provide field trips for

students, trips to St. John's - I mean in some parts of this Province, probably

Charlottetown, Labrador, the kid would grow up there and the first time he's out

of Charlottetown is when we take him out on a trip. Now the same thing with the

Northern Peninsula.

So to engage in these types of extra activities for

students that we believe enrich the program of students, we don't get sufficient

funds from government to do that so we have to get the funds elsewhere to do

these types of activities and that necessitates local fund raising. I think it's

an acceptable practice and we have a policy on it so that it's not to onerous on

the parents to be always bombarding them with chocolate bars and things of that

nature. Fund-raising itself should be a learning experience and part of our

policy is that the students should be able to provide a service or some goods to

the parents in fund-raising rather than just asking for money. There should be

some return to the person that's contributing the money, that's part of the

philosophy. We asked the local school committee's to monitor the amount of

fund-raising at the school level so that it's reasonable, given the clientele of

that particular community. In some communities you could certainly raise more

money then others depending upon the economic condition of that particular part

of the Province. So therefore more fund-raising goes on in some places than in

others.

With respect to accountability of these funds, these

funds are accounted as part of the local discretionary funds as I said before.

They have to report and the principal has to report three times to the local

school committee each year and three times to central agency.

MR. CHAIRMAN: Mr. Dumaresque.

MR. DUMARESQUE: Thank you. I wonder if I could ask

the representative from the Department of Education, how does the Department of

Education view these local discretionary funds and what kind of monitoring do

you have? Do you have any idea of the level of funds available to various local

schools?

MR. CHAIRMAN: Mr. Berniquez.

MR. BERNIQUEZ: Mr. Chairman, we as a department do

not monitor. They are not recorded in the financial statements of the school

boards, the local fund raising projects, so basically I guess, we don't really

have any idea about the magnitude of what kind of dollars are involved.

MR. CHAIRMAN: Mr. Dumaresque.

MR. DUMARESQUE: Maybe I should ask the Auditor

General.

MS. MARSHALL: We have started to look at this type

of funding with some of the school boards and it is significant in some of the

boards. I think in many of the boards we looked at it, it is in the hundreds of

thousands of dollars and our philosophy is that the same policies and procedures

and legislation that govern funding that is received from the provincial

government should be the same policies and procedures that apply to this type of

funding although not everybody agrees with our philosophy, but we have started

looking at the controls over that money because in some boards maybe it is quite

significant, as I say, in the hundreds of thousands of dollars.

MR. CHAIRMAN: Maybe I could just interject here,

Mr. Dumaresque, for a moment because I want to get into the point that the

Auditor General has just touched on here, and it may well be fine; the Auditor

General made a comment for a PTA to raise funds to buy a computer to put in the

library, that is their business, if they buy something they raise the funds they

put it there, but if funds are given to the board, then it is a moot point as to

whether or not their full response should be expended for example under the full

control of the Public Tender Act.

It is an area of discussion not just for this board

let me tell you, but with many other boards and agencies which have that kind of

accommodations. We had a hospital board here yesterday which has a health

foundation, we had one in Twillingate the day before that has a hospital

foundation, private benefactors who provide funding and the question that has

never really been addressed to my satisfaction, is: are those funds really

taxpayers dollars? Do not the people who contribute to those foundations or

whatever, do they not expect that those funds would be expended in the same

manner as any other taxpayers dollars et cetera. Would you like to comment on

that, Mrs. Marshall, as I think that is really where you are coming from?

MS. MARSHALL: Yes. I don't have a legal opinion -

MR. CHAIRMAN: No.

MS. MARSHALL: - it is just my own opinion, but I

would think that when people contribute and give extra funding like I personally

give money to the school for various supply, I give it under the premise that

whatever rules and procedures are in control for the government money are also

applied to the money that I am giving to the organization; also, the Public

Tender Act says, and again, this is not based on any legal

interpretation,

Section 3 says that, you know, when goods or services are to be acquired by a

government-funded body, the government-funded body shall invite tenders and

there is no reference at all to public monies.

MR. CHAIRMAN: That's right.

MS. MARSHALL: So it appears to indicate that even

if it is not public money, the rules and procedures should apply. It is an

interesting area both for school boards and the hospitals and we are commencing

a project on the hospital side of non-public funds, so maybe someday we would

look at the school boards.

MR. CHAIRMAN: We are talking big dollars in many

cases too.

MS. MARSHALL: Yes, big money.

MR. CHAIRMAN: Millions of dollars in specialized -

MRI units and these types of things are being funded by trusts and agencies

established for that and the question is: should that go to public tender, so

when you say that a large portion of the funds expended on that particular bid

upon contract was not government money, it came from the same taxpayer and the

question is, does that taxpayer expect that the same rules and procedures would

be followed and, how do you separate it, and I guess what we have generally come

down to is if it flows through the board's books and the board should call

tenders for it; if that PTA chooses to buy it and bring in a box with a computer

in it, that is a different matter perhaps; it is splitting hairs, but perhaps

the time has come where a policy should be laid down. Are you finished?

AN HON. MEMBER: Yes.

MR. CHAIRMAN: I would like to stop for coffee

before I continue.

MR. DUMARESQUE: No, I just had a couple more

questions -

MR. CHAIRMAN: You have a couple more quick ones?

Carry on.

MR. DUMARESQUE: I noticed that there hasn't been,

as far as I can see, any place where the Auditor General has noted whether there

is a conflict of interest policy in place on the board. We've seen that there

hasn't been in some other boards, the health care boards that we looked at and

other school boards. Is there a conflict of interest policy in place in your

school board?

MR. WILKINS: The Auditor General did pick that up

and made a recommendation on it, that there were no conflict of interest

guidelines. We are in the process of developing these with a deadline of

December to have them in place. December of this year.

MR. DUMARESQUE: One thing we picked up yesterday

in relation to the health care boards is the whole issue of salary supplements

to various administration positions within the health care boards. Does anything

like that exist in the school board? Are any salary supplements given to anybody

on the school board, and if so what would they be for?

MR. WILKINS: Yes, there is a salary supplement

given to the superintendent.

MR. DUMARESQUE: What level would that be?

MR. WILKINS: Six thousand dollars a year I believe

it is, Bob.

MR. PADDOCK: Yes.

MR. WILKINS: (Inaudible).

MR. DUMARESQUE: What would the Department of

Education - how would you view that? Particularly as the Department of Health

has indicated that such supplements should cease, particularly when a position

is filled by somebody new who is not under a direct contract of service where

this type of thing would be allowed. How does the Department of Education view

this thing?

MR. BERNIQUEZ: Mr. Chairman, the department does

not fund such supplements. They would come from the board's own funds which

would be a board decision and not the department's decision.

MR. DUMARESQUE: I understand. I wonder if the

Auditor General would have a comment on that?

MS. MARSHALL: Yes. I had discussions with senior

officials of the department and they indicated that they do not have a policy on

it. My understanding is that they are aware of it and they may be formulating a

policy but at this point in time there is nothing that affects allowances.

Probably also, if I could just go back to the conflict

of interest issue that you raised a few minutes ago. Government is looking at

conflict of interest. The members' conflict of interest procedures were changed

a couple of years ago and they are now looking at conflict of interest

procedures and policies for public servants. I have written to the Department of

Justice and indicated that the schools boards and the hospitals seem to be out

there on their own with regard to conflict of interest and that this was an

issue now being addressed by government. I recommended that they also look at

the hospitals and school boards and possibly include that in their policy.

MR. DUMARESQUE: I hope you don't adopt everything

that we do as politicians because I tell you -

MR. TOBIN: (Inaudible).

MR. DUMARESQUE: Yes, a supplement would be

definitely required (inaudible).

MR. CHAIRMAN: If you've ever seen a fly hit with a

sledgehammer that is (inaudible).

MR. DUMARESQUE: I have nothing. I don't own any

businesses. I have nothing. I still have 300 pages to fill out for the conflict

of interest commissioner.

MR. CHAIRMAN: And your youngest child and the

value of their life insurance policy.

MR. DUMARESQUE: So you can probably go too far

with it, but it is necessary I guess for public confidence.

MR. TOBIN: (Inaudible).

MR. DUMARESQUE: No supplements, no. I really

appreciate your candour in answering these questions. As Mr. Penney pointed out,

we are not here to interrogate. I come just seeking information and try to get

as much of it as we can. Lots of times for comparison purposes because we go

through a number of different boards, we hope to be able to, at some point,

maybe make some recommendations for consistency in terms of how government

policy is implemented, if not approached directly, implemented at various Crown

agencies and other entities. That's basically where I'm coming from so I

certainly would not want you to believe anything differently. Thank you very

much.

MR. CHAIRMAN: Thank you very much. I think we'll

have coffee before our lunch.

Recess

MR. CHAIRMAN: I trust everybody's enjoyed their

coffee, feel free to have a second cup if you wish. We'll carry on, Mr. Penney

would you like to carry on from here?

MR. PENNEY: Thank you, Mr. Chairman.

MR. CHAIRMAN: At least we haven't got the bar

downstairs with the music playing (inaudible). Yesterday afternoon we were here

and the jukebox was playing in the bar downstairs, boom, boom, boom.

Mr. Penney.

MR. PENNEY: Mr. Wilkins you mentioned earlier that

you have been superintendent for four years was it?

MR. WILKINS: Yes, Mr. Penney this is my fourth

year.

MR. PENNEY: Are you the equivalent of what used to

be called the school inspectors? The guy that used to travel around on a regular

basis and the teachers would prepare the students and they'd be trembling in

their seats waiting for the school inspector to come in. Are you the modern day

version of that?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: No, Mr. Chairman, nobody trembles

when I go into a classroom.

SOME HON. MEMBERS: Oh, oh!

MR. PENNEY: You mentioned that you're making an

attempt to visit each school at least once a year and in the last four years I

think I've ran into you out in my district at least a half-a-dozen times.

MR. DUMARESQUE: You don't go to Labrador.

MR. PENNEY: My colleague says you don't go to

Labrador an awful lot (inaudible).

I just have a couple of very minor questions. Mr.

Dumaresque asked you about supplements being paid over and above the salaries,

is it your understanding that this is standard practice within the industry?

That practically all school board superintendents, none of them or half of them

receive this kind of a supplement? What's your understanding of the practice?

MR. WILKINS: It's my understanding that

practically all of the superintendents of this Province would have a supplement.

That is allowed for, it is my understanding, under the Schools Act. I can't

quote the

section of the act but I believe the Schools Act does permit the board

to do that.

MR. PENNEY: And the amount of remuneration that

you receive, as you have volunteered to us here, is that in keeping with what

most superintendents would get? Is that on a par?

MR. WILKINS: I would say, Mr. Chairman, and Mr.

Penney that that's an average for the Province. Some would be more, some would

be less, depending upon the size of the school district I would suspect and the

duties of the superintendent.

MR. PENNEY: I can't imagine there being any school

district or school board district in the Province that would be larger then

yours.

MR. WILKINS: Geographically, Mr. Chairman, that's

correct and I probably should ask for an increase.

MR. CHAIRMAN: Things are moving rather quickly.

SOME HON. MEMBERS: Oh, oh!

MR. WILKINS: The size of a school district by

definition is related to the number of the enrollment of students in the

district. So ours, I think, ranks number five in the district with respect to

size, substantially larger with respect to student enrollment.

MR. PENNEY: Geographically, the individual schools

that you have to service are considerably distanced from each other and from

your school board office, aren't they? Could you give us some idea where the

farthest schools are from your office?

AN HON. MEMBER: (Inaudible).

MR. PENNEY: Around the coast? Don't concentrate

simply on Labrador. Danny has a fixation with Labrador, but all around the

Province.

MR. PADDOCK: Yes, Mr. Penney, I can do that.

One of the most remote schools is St. John's -

interestingly. Our central office is here in this town, Grand Falls - Windsor,

so one of the furthest distance schools would be St. John's.

Our schools are concentrated in various areas of the

Province. Between Chapel Island, Summerford, and the Baie Verte Peninsula, which

is within a seventy-five or eighty mile radius from the office, we would have

about 70 per cent of our student population and 70 per cent of our schools, so

the logic for the office being located in Grand Falls is the fact that the bulk

of our schools are here in Central Newfoundland.

Now after you move east of Chapel Island you don't hit

another Pentecostal school until you get to Goobies, so there is a

concentration, one in Goobies, one in Creston, so they are relatively close to

each other. You have four schools on the Avalon. Two of them are in Port de

Grave and Victoria, so they are close to each other, and two schools in St.

John's which are across the street from each other.

Now when you move west of the Baie Verte Peninsula we

have a school in Deer Lake, two schools in Stephenville, three schools on the

Northern Peninsula, three schools in Southern Labrador, Charlottetown and Port

Hope Simpson - two, rather - and one in Northern Labrador, namely Postville, so

in total there are thirty-nine schools.

We also operate a couple of joint systems with the

integrated boards, a joint system in Burlington, on the Baie Verte Peninsula, a

joint system in Pacquet - Woodstock, and a joint system in Sop's Arm.

MR. CHAIRMAN: Mr. Penney.

MR. PENNEY: If you would be so kind as to turn to

page 150 in this document that you have, it is the Pentecostal Assemblies Board

of Education Purchasing Policies and Procedures, and on that particular page,

tendering. The last paragraph says: The school board believes in supporting

local business. Consequently, when tenders are equal, the purchase of supplies

or services will be awarded locally.

Recognizing that you have one central board office

here in Grand Falls, and you have those schools scattered all over the Province,

define `locally' for me.

MR. PADDOCK: `Locally', by definition, is the

local area where you are going to do the work. For example, if we were up in St.

Lunaire and our maintenance people were up there, and we were doing a job that

the materials were publicly tendered on, if the purchaser in St. Anthony was the

lowest tender but there were other lower tenders, just as equally low tenders,

in Central Newfoundland, we would go with the local supplier in St. Anthony, as

an example.

MR. PENNEY: I don't have it right in front of me

now. I am looking at copies of the invoices from Ultramar in Windsor. Here is

one here, page 181. Ultramar from Windsor makes a trip to Lewisporte because the

sewer is plugged. It is called a sewer plug, a trip to Lewisporte from Grand

Falls.

MR. PADDOCK: 161?

MR. PENNEY: No, 181. The point I am making,

gentlemen, is that if your policy suggests that the tender should be awarded

locally, and you are having Ultramar in Grand Falls provide those types of

services - you have on page 179 a trip to Goobies, 181 a trip to Lewisporte, is

that not a contradiction in terms?

MR. PADDOCK: Sir, those are a year-and-a-half or

two years old now. Ultramar is our service person. These are not tendered. This

is a trip to go out and plug a sewer. It wasn't tendered. I don't know why we

didn't call somebody in Lewisporte. There may not have been someone available at

the time. I can't answer that. I would have to go back and talk to the

principal, probably, and find out why that was. I can't answer that.

MR. PENNEY: The same argument can be made for

practically every invoice that is included in this dossier, from Ultramar. I

just used these two specific cases to make a point.

MR. PADDOCK: Yes.

MR. PENNEY: I would like to go back to the public

tendering for a moment. Page 22. Just for clarification, the bottom item there,

an automobile for $14,300. You state that three quotes were obtained and were

documented. Was this the lowest of the three quotes? Page 22. The invoice we

have but I don't have any reference on the other two quotes. You say three

quotes were obtained. Our question was: Is this the lowest of the three quotes?

MR. PADDOCK: It would have been, yes.

MR. PENNEY: It would have been?

MR. PADDOCK: Yes.

MR. WILKINS: Mr. Chairman, Mr. Penney, a follow up

to that. That was two years ago, and we have three school board owned vehicles

that are used by the program coordinators and myself for travelling to the

schools in our district. We have found the mini-van to be the most beneficial

because of the amount of cargo that we carry back and forth to the schools. Each

year we buy a new vehicle so we keep them for three years. We had public tender

for the one we bought this year. That was two years ago but now, since then, we

have been public tendering the vehicles and we did public tender the last fall's

vehicle.

MR. PENNEY: So your procedures as they relate to

the Public Tender Act have changed in the last couple of years.

AN HON. MEMBER: Yes.

MR. PENNEY: I have no further question as it

relates to that, just one general question. You mention that over the last

twelve months or so you visited practically all of the areas of the Province for

public meetings as it related to the proposed restructuring of education and the

Williams report and the negotiations that were ongoing between government and

the Pentecostal, Roman Catholic and Integrated schools at the time. How many of

these public meetings did you have in the Province?

MR. WILKINS: Mr. Chairman, Mr. Penney, I would

think, sir, we had ten or twelve of these around the Province. I didn't

personally attend all of them. I attended five or six of them myself. The others

were conducted by the assistant superintendents.

MR. PENNEY: What is his name?

MR. WILKINS: There are four assistants: Dr. Melvin

Regular, Mr. Melvin Burden, Mr. David Rideout and Mr. (inaudible).

MR. PENNEY: I think the meetings that I attended

you were at both of them.

MR. WILKINS: Yes.

MR. PENNEY: This probably might not be in keeping

with the type of questions that one would expect at a Public Accounts Committee.

Are you satisfied with the results of those meetings? The Chairman can rule me

out of order if he wishes.

AN HON. MEMBER: (Inaudible).

MR. WILKINS: Yes, Mr. Penney, the school board

felt that we had a duty to our people to inform them of the restructuring which

was being proposed by government. The objective was to inform our people and to

ask them to respond as they saw fit. If they wanted to respond supporting

government that was their right just as much as it was to respond not supporting

the government.

MR. PENNEY: I understand what Pastor King's answer

would be if I had asked him that same question. I have no doubt whatsoever. In

your particular case you don't perceive that there was a conflict of interest

there as being superintendent of the school board. That was in keeping with your

job description as you understand it.

MR. WILKINS: It could be perceived as potential

conflict of interest as protecting my own job. I would admit that. I've given my

life to Christian education in the Province and it is bigger than me. I feel

that I can compete on the open market for a job. It wasn't a job security thing

for me at all. I believe that I will have a job in the restructured system even

if it is an interdenominational or even a public school system. I wasn't at it

from a personal point of view at all. It was the point of view of informing our

parents. The system is bigger than I am. I will be here today and gone tomorrow

and the system will continue.

MR. PENNEY: Thank you. If I may be permitted I

would like if Pastor King could just make a brief comment on that question I

asked Mr. Wilkins.

PASTOR KING: Yes. I think we need to understand

and appreciate that the school board is more than just an agent of government.

The school board is an agent of a class of people who have rights for education,

and the Pentecostal Assemblies of Newfoundland represent the Pentecostals. In

1954 we were given the right by the Newfoundland government and we petitioned

the Canadian government to enshrine that right. We were given a promise by the

then-Prime Minister of Canada, Mr. Trudeau, that when the Constitution was

repatriated, we brought our Constitution home, there would be five years before

they would be able to make an amendment to that Constitution. His argument was

at that time in as much that we were close to bringing the Constitution home

that: You should not look for an amendment to the BNA Act. Five years after they

kept their promise and they enshrined the rights of the Pentecostal class of

people as if we had these rights prior to 1949.

So those meetings that were held across the Province

were really not initiated by the superintendent of our board, but rather these

meetings were initiated by the leaders of our fellowship, so in some cases it

was a joint action that was taken by the Pentecostal Assemblies of Newfoundland

using the personnel that worked for the class of people: Namely the Pentecostal

Education Council and the Pentecostal School Board. Because these are the

professional people who are versed in what is going on in education and can best

give the answers.

Really, the whole exercise was that our people would

understand and appreciate what the royal commission was saying and if

implemented what the complications would be for us as a class of people. So that

we wouldn't have to try and answer all the questions at the end of the day and

have our people in a state of confusion as to what has been going on in the last

two or three or four years. So really, in responding to your question, we

appreciated very much the input of our professional personnel at the board level

and also at the Council level.

MR. PENNEY: Thank you. That is all, Mr. Chairman.

MR. CHAIRMAN: Mr. Penney, are you finished? Thank

you. Mr. Crane.

MR. CRANE: Yes. On pages 5 and 6 the Auditor

General notes that the board doesn't have an operational plan in place in

finding its annual objectives. What's the board's current status on this?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: To state that we don't have annual

objectives in place is only partly correct. We do have a strategic plan that was

developed and there were four major items that were identified on that strategic

plan for this coming year and one of them was obviously restructuring; that one

had a fair expenditure of time. Another one was computerization and we have

moved in that direction and in fact, we have reported back to the board and had

the board approve a three to five-year plan on the computerization of our school

system and with yearly updates to be given each year to the board on that

particular plan.

The other item was staff development, the human

resource development as a major objective, but we have not moved on that as

successfully as we would like to have moved on it however, we have restructured

the office staff for next year so that that can be a major objective that we

will pick up in September, so there have been some objectives, even though at

the time of the audit they weren't laid down a-b-c, they were in strategic

planning and were recognized by the auditors actually further over in the

report, if you look through the report.

There are other objectives that a school district

would have that would flow from the Department of Education to school boards,

and from us to schools with respect to curriculum in particular, and we would

have an in-service plan in place which would reflect the objectives in

improvement in curriculum and so on. We have also had an objective this year of

decentralizing our operations and asking each school to submit to us by October

a plan for the development of their school which involves in-service for all our

teachers. These were submitted to the office by October 15, approved and worked

on by the individual schools.

MR. CHAIRMAN: Mr. Crane.

MR. CRANE: The Auditor General also notes that the

board does not have a term of reference in place for its committees, and without

that term of reference for committees, the committees workload and objectives

may never be met; have you done anything with this, since the Auditor General's

report?

MR. CHAIRMAN: Mr. Wilkins.

MR. WILKINS: With respect to terms of reference,

the number of the committees of the board have been in place for quite a number

of years and I would suspect that initially, and that was probably back in

1969-'70, there were terms of reference for all our committees. Now they would

be obsolete and I didn't feel like bringing them on the carpet but rather than

do that, I asked the board to review the terms of reference and approve new

terms of reference and in fact, when we got the draft report in November from

the Auditor General, all of the major committees terms of references were

drafted for them between November and the finalization of the report, and were

approved by the school board on November 17, and are actually our appendices of

this report that you have there today so that has been taken care of; we knew

what the terms of reference were, they just weren't written down.

MR. CRANE: Okay, sir. One of the items there:

Financial Management Manual: the Auditor General says you put them in place at

the time of the audit - the Financial Management Manuals - did the board make

any progress on this? It is on pages 6 and 7 if you are looking in the manual.

AN HON. MEMBER: Sixty-seven.

MR. CRANE: Six and seven.

AN HON. MEMBER: Oh, pages 6 and 7; I am sorry.

MR. CRANE: No, it is just that I am not coming

through very well.

MR. PADDOCK: I am trying to find -

AN HON. MEMBER: Six and seven.

MR. PADDOCK: No, I have that. I am trying to find

the procedures that we outlined, and I think they are a part of this.

AN HON. MEMBER: They are in the appendix.

MR. CHAIRMAN: Page 151, that area.

AN HON. MEMBER: (Inaudible).

MR. PADDOCK: No, no, procedures for the

development of the budget; I think that is what we are looking for.

On page 44, I believe - we don't have a manual, as

such, and never did. In fact, we are sort of sorry that when we were set up, I

guess, there wasn't some sort of a manual presented to us. Everything we have

done we developed in co-operation with other business managers, but after the

report we did up the procedures on page 44 showing exactly what we do with

regard to our financial budgeting. I think that is what you are asking.

MR. CRANE: There is another item there, but you

can go ahead anyway. The question I really asked is: Do you have a manual in

place? You didn't have one -

MR. PADDOCK: We didn't have a manual, Sir, but

this is what we have followed, Procedures for the Development of the Budget.

MR. CRANE: That was in place prior though, to -

MR. PADDOCK: No.

MR. CRANE: It wasn't?

MR. PADDOCK: That was in place but not written

down.

MR. CRANE: Oh, I see. Okay, go ahead.

May I ask the Auditor General: These procedures, have

you looked through these?

MS. MARSHALL: Yes, I have looked through these.

These are not all inclusive of the types of procedures that I was envisioning.

For example, I was looking for a complete manual which addressed all of their

financial policies. For example: What are the travel policies of the board? What

are the entertainment policies of the board in the area of training for staff?

What are the training policies of the board? I wanted to see the full range of

financial policies and procedures.

This issue has come up since with other boards. It

seems to be a recurrent problem, and the last meeting I had with the board I

made a commitment that I would contact the Deputy Minister of Education and

bring it to their attention, because I felt that the Department of Education

should participate in this. I don't see all 20-odd boards going out and

everybody individually developing their own manual. I think that there should be

one standard manual for all boards, with some consistency. I don't think you

should have a certain travel policy and the next board have something different,

and the next board have something different, so I think that it is a joint

effort between the department and the boards, and it is a major undertaking,

something like a capital asset mainly.

MR. CHAIRMAN: Thank you.

Mr. Crane, are you finished?

MR. CRANE: Yes.

MR. CHAIRMAN: Mr. Hewlett?

MR. HEWLETT: Thank you, Mr. Chairman.

There are a couple of comments, really, a brief

reference to what Mr. Penney raised earlier with Pastor King about the process

relating to the restructuring of education. I, myself, did not look upon it as

any kind of a conflict of interest, two separate, well attended meetings in my

district, I was kept on my feet for an hour - two hours - both being asked for

advice and being given advice. Subsequently, I had a number of petitions to

present in the House of Assembly, but when the commission came around to my neck

of the woods I even heard, through the grapevine, some consternation from other

classes of people that they were astounded that the Pentecostals in that

particular area stole the show in that they put on an excellent presentation,

came on like gang busters, and caught a lot of people really off guard, so I

would commend them on that.

With regard to the exercise we are in here this

morning, and the exercise we have been in for awhile with regard to boards,

agencies of the Crown, et cetera, there appears to be a consistent trend that

yes, we passed the Public Tender Act some years ago, and so on and so forth but,

Mr. Chairman, I don't think it's sufficient for the minister to give a

department - to put out a press statement or send around a memo saying: From now

on, all agencies that report to my department should obey the Public Tender Act.

I think there has to be more hands on contact. If this

particular school board didn't run into a snag, or to give an issue and have to

check with the department, it could very well go on for years doing what it has

done for years. Unless there is an impetus on the part of the department to see

that policies are implemented in a practical way, and consistently throughout

agencies that report to the department, we are going to be doing this with

individual agencies for a long time to come, because I think there is a failure

on the departments of government to do adequate follow-up and monitoring with

the agencies that report to them. As a result, we are having the agencies before

us and at times I wonder if some departments are the ones who should be

enforced.

Thank you, Mr. Chairman.

MR. CHAIRMAN: Thank you, Mr. Hewlett.

Does anybody want to respond to that?

MS. MARSHALL: Yes, I would like to respond; I will

volunteer.

I must agree with the member, because we found the

same issues when we were going through. It does; it recurs as you go from school

board to school board and hospital to hospital. As part of the audits last year

we did take a look at how the Department of Education was overseeing the

activities of the school board. There are several recommendations there, not in

that particular report but elsewhere in the report, which are geared towards the

Department of Education, and indicating to them that they should be more hands

on in this process. I am hoping that the Public Accounts Committee will have

hearings also on that

section of my report.

MR. CHAIRMAN: Thank you. Mr. Langdon.

MR. LANGDON: To carry it one step further, I think

government has. This is the whole idea of streamlining health, where all the

different boards are bringing it into line, where you have a number of major

boards where the government can be more accountable to the people. The same

thing with the school boards; there are a number of school boards, and hopefully

that can develop the same way.

Just a comment, I think, to the school board and to

the Auditor General. I see, from what I have gathered here, and the number of

people I have listened to and so on, the board appears that they have probably,

even though it hasn't been written down, they have followed the procedures

relatively well that were expected of them. I guess the biggest problem has to

be (inaudible) paper chase, that the policies have been in place verbally but

they haven't been written, so I think that is one of the biggest problems with

the Auditor General and some of the things that you have been doing and so on.

MR. CHAIRMAN: It has been said that verbal

policies are not worth the paper they are written on.

MR. LANGDON: Yes, I know, but with no paper chase

obviously there is a problem with it and it is the public accounts group like

us, I guess, where people are accountable to the public, because the public want

accountability and I think when we are spending millions of dollars of people's

funds then we should be accountable.

I want to commend you people this morning for the way

you have been frank in discussing it and so on. I would think, if all things go

well, and let's hope they will, probably the board that we are discussing now,

and the restructuring, some of the questions might be academic.

MR. CHAIRMAN: Are you finished, Mr. Langdon?

MR. LANGDON: Yes, I am.

MR. CHAIRMAN: Mr. Dumaresque is gone. I understand

he was finished anyway, in his questioning.

One area that I just simply want to bring forward, and

I am going to ask the Auditor General, first, to expand and then ask the board

to respond to it. In the report you said that there is a lack of adequate

reporting to the board by management. Would you like to expand on your concerns

there, and then we will have, perhaps, the board respond to that?

MS. MARSHALL: Well, perhaps I can just focus on a

couple of areas. One is to go back to the pupil transportation system which

government is funding, as was said earlier, to the tune of $30 million. I think

this board pays out directly almost $1 million and then there is also an

expenditure by NORPEN and, I believe, another transportation committee; yet

there doesn't seem to be adequate reporting to the board exactly on what is

going on with the transportation system for the board. It seems that once a

process gets in place, the process seems to carry on with some modification as

you go from year to year. I think the routes may shift, or a few routes may

change, but it seems that the same system goes on and on and on, and nobody goes

back, really, and does a very thorough review of the system and reports back to

the board on any changes that could be made.

A couple of years ago the Department of Education had

I think it was some sort of pilot project, either in Conception Bay South or

Conception Bay North, on their bussing transportation system, and as a result of

that process they saved $250,000; but someone had to go back and take a really

detailed review of exactly what they have been doing for the past several years.

Another area where I recommended improvements in

reporting was in the area of financial reporting. For example, the board

receives information on expenditures to date, but what I was recommending is

that the board also receive information on what the projected expenditures are

expected to be until the end of the year, and this is similar to what is done in

government, for example. You will see the projections to date, revised budgets,

and this is the type of information the board knows so that they can anticipate

where they are going, and at the end of the year then they can determine whether

they have arrived at where they thought they were going.

Another example in reporting, we talked about

strategic planning. This board has done quite a bit with regard to strategic

planning, but they have done it from a very high level. Now they have to carry

on and sort of get down into your direct operational plans and be very specific

about what they want to accomplish over the period of a year. For example, you

talked about training for your staff. What you need to put in place is exactly

what type of training you want to do for your staff over the upcoming year, and

then at the end of the year you should go back to the board and say: We had

anticipated we were going to give our staff eight courses, and these are the

eight courses, and we would like to report to the board that we have delivered

on seven of those objectives.

That is the type of reporting that I was thinking of.

MR. CHAIRMAN: Now, there is a mouthful; well said.

Who would like to respond to that? Pastor King.

PASTOR KING: I would like to respond to the

financial aspect of it. Maybe the government officials feel that the board is

not adequately versed with expenditures, but we do have the budgetary process,

and we have our budgetary update, and we are very, very pleased that we have

been able to keep on track. In the last number of years we have come through

with a balanced budget. As a matter of fact, we have come through with a surplus

the last three years, maybe the last four years, and at the end of the day we

have taken a look at that surplus and said that these monies will go out into

the various schools, and mostly in the area where we suffer the most, and that

is monies for instructional purposes, and it has gone into instruction materials

for our schools. So, from the board's point of view, we do keep abreast and we

are knowledgable in what is transpiring throughout the year.

We meet five or six times a year, and our meetings are

not just evening meetings. We meet a whole day, maybe two days, so we get a

written report from our superintendent on every aspect of the activities that

are going on at the administration office. Now whether that is adequate, or

whether that is enough, or whether the fine lines are there, well that is for

somebody to tell us, that we have to do more than what we are doing.

MR. CHAIRMAN: I think my question was: Are you

satisfied that you have enough information really (inaudible)?

PASTOR KING: Yes. Another thing that we need to

keep in mind from our board's activity, it is almost as a committee of the whole

rather than - even when committees come in with a report it is just not simply

receiving that report. That report is taken and scrutinized by the board as a

whole. Because we give that kind of time and attention. We have to because we

have to bring it so far. We could never operate our board with just evening

meetings. We come in and we start in the morning and we go throughout the whole

day and maybe into the evening and on to the next day. So it is (inaudible).

MR. CHAIRMAN: Thank you. Mr. Wilkins, did you want

to add something to that? You looked like you were about to speak.

MR. WILKINS: I think, Mr. Chairman, Pastor King

has adequately covered it. There is reporting to the board. I think the problem

again was that the procedures for reporting weren't laid down and we have done

that. I believe we have improved the reporting to the board in more detail since

the Auditor General's report. The financial reporting is now done in more detail

with budget amounts spent to date this year and so on, and the balance. That is

done at every board meeting now and that wasn't done up to the Auditor General's

report. It was done periodically but now it is done at every school board

meeting on a consistent basis as an item on the agenda. I believe we have

improved the reporting to the board.

The things that I report on to the board, there were

no procedures laid down for these, so I went back through what happened the past

three or four or five years and said: There are the things that should be

reported on. Drafted it up in a policy form, submitted it to the board, and now

I'm accountable of course to report these things to the board.

Whereas before I

probably did it but nobody said: You have to do it.

Whereas now I have to do it

because it is policy of the board to do it.

MS. MARSHALL: I think that that is very relevant.

What I found in looking at some of the boards is sometimes the boards accept

only what is given to them and there isn't much thought given into what they

themselves require. I think that it should be a conscious decision by the board

members themselves as to what they need in order to be an effective board

member, and not just to accept whatever is given to them and never question and

never ask for anything more. I think in the final analysis the board members

themselves have to be satisfied that they are receiving everything they need to

be a good board member.

MR. CHAIRMAN: I think it is fair to say that in a

(inaudible) of boards that we've looked at many of your comments have been

almost identical in this regard. Is it not a case that perhaps some policy

procedures should be developed by the Department of Education and standardized

for all boards? Because if we have eighteen different school boards and all

operating by different policy manuals and procedures, is there not some benefit

in standardizing it? I would like to hear from both sides. Perhaps the Auditor

General would like to respond from her point of view on how you see that, and

then the board from an operational point of view how you would see that.

MS. MARSHALL: I agree with that. Just as an

example, I think pupil transportation is one issue. All of the boards are

incurring expenditures on behalf of pupil transportation yet in all of the

boards that we looked at there is very little reporting to the board on

transportation. I think that it is such a big issue that I think it would be

very worthwhile if the Department of Education got in there and looked at the

whole transportation system and came up with a standard system instead of all

the boards themselves out trying to sort this out. I mean, that is just one big

area.

Human resources is another area. The majority of money

that is spent by the Department of Education is going into funding teachers'

salaries and human resource management seems to be a very low priority item. For

example, I don't think any of the school boards have a human resource division.

It seems like the business manager has some responsibility for human resources,

as does the superintendent, as does the assistant. It seems like human resources

doesn't really have a home anywhere, yet that is the biggest expenditure.

I would think yes, the Department of Education should

sort of be

helping with the school boards in that area.

MR. CHAIRMAN: In making that suggestion and

recognizing that there's a right and responsibility of boards also to manage

their own affairs.

MS. MARSHALL: That's right.

MR. CHAIRMAN: And I'm not suggesting that the

department should say: here's what you will do and here's how you will run your

board. It's just that there may be some benefit to boards of not having to

reinvent the wheel. If we have all the boards that are doing things that have

worked right then perhaps other boards should adopt it. Would you like to

respond to that Pastor King?

PASTOR KING: Well I would respond, just sitting

here in the magnitude of the exercises before us this morning I would think -

personally I would make a recommendation to the department that at least one of

their assistant superintendents would be a controller. He would supervise

policies and procedures because what we're doing here requires full time

policing to make sure that all your policies and procedures are carried out and

that's impossible to be done by a board. I don't know how other boards conduct

their meetings, whether they sit as long as we do, my understanding in number is

that they just have evening meetings. Then their human nature, those boards are

put together by elections and whoever you elect that is the person that you have

to work with.

To readily respond to your concern, there are some who

are quite satisfied to receive what they are told. There are others that are not

satisfied with that and they keep their business manager and the superintendent

on his/her toes. So you have that and I'm sure that in any institution with a

governing board, how these people get there is not necessarily the best people

that arrive there, that are competent, they're good but they're not competent in

all those areas and don't fully understand. You can put the textbook under their

nose and they haven't read the manual. So they've spent their whole tenure as a

board member and haven't read the manual. You see there's many, many reasons to

bring a person to the table. So, perhaps we need a superintendent, assistant

superintendent who is the controller of the board, especially if it's any larger

than ours, that's going to police your policies and procedures for you. He knows

everything because we've been very, very fortunate, with the calibre of people

that we have, I have had, in my history of our board who seem to know - I mean

they must eat and devour the various acts; the School Act, the collective

agreement. I mean I am surprised - what does this mean - you know, it's not a

matter of research it's just flipping a page and they can tell you, you see. If

everybody's as fortunate as we are though, we must have some good personnel out

there.

Now that's a long way to respond but I'm just

observing here this morning the magnitude and we haven't asked any questions

yet. I mean sure, if we're going to fine tooth comb - so it's a tremendous

responsibility and that goes to a voluntary board where members were voluntary.

MR. CHAIRMAN: Thank you very much. Now, Mr.

Berniquez do you want to respond?

MR. BERNIQUES: Mr. Chairman, the department has

been active in these areas of course with the human resource development area,

it's something that we've been active in. In terms of transportation we have

been reviewing systems. At present we're getting into this whole area of

compliance with the legislative requirements. We have a couple of new staff

positions approved. We haven't had them filled yet due to limited financial

resources. It is an area which we recognize that needs a hell of a lot of work,

an enormous amount of work and we're pursuing it as vigorously as we can with

the resources that we have.

MR. CHAIRMAN: Thank you very much. I think this

has been an useful exercise, a very worthwhile morning and I want to thank the

witnesses who have appeared on behalf of the board; thank you very much for your

time and your responses and the approach that you have taken. I hope you

understand where we are coming from and I hope perhaps that has been some value

to you as well.

Obviously, the Auditor General's visit has stimulated

some changes within your system and hopefully this will stimulate more and as I

said, we appreciate your being here this morning answering in the manner you

did.

PASTOR KING: Thank you, Sir, for summoning us

here. Just another experience and I believe we will be enriched because of this

exercise. We appreciate the contributions that you have made to us as a board.

MR. CHAIRMAN: Thank you very much.

PASTOR KING: We will be a little sharper next

time.

MR. CHAIRMAN: If we have made any small

contribution then we are pleased with that, and I thank the Auditor General and

her staff as well and the representative from the Department of Health, Mr.

Manuel, who is here to see what he is going to face next year; his board has

been audited and Mr. Penney I am sure will want to ensure that that's one of the

items the committee chooses to look into next year and we look forward to

hosting a meeting of this nature in Lewisporte around this time next year.

Thank you as well to the staff and to the members of

the committee and there being no further business, this meeting is adjourned.