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Original online publication date: January 23, 2019
The B.C. legislature Speaker’s report detailing “flagrant overspending” of taxpayers’ money by two senior managers at the B.C. legislature also alleges there were attempts to cover it up.
Receipts were allegedly doctored, a report raising concerns about suspicious retirement benefits disappeared and a staff member who tried to blow the whistle on questionable expenses was fired, according to the report, released Monday by Speaker Darryl Plecas.
Suspended clerk of the legislature Craig James and sergeant-at-arms Gary Lenz are accused of creating a systemic culture of misspending that evaded the checks and balances of the B.C. legislature.
Allegations of lavish overseas trips and personal expenses charged to the taxpayer, inappropriate employment benefits and cash payments in lieu of vacation add up to millions of dollars, the report says.
‘Retirement allowance’ payout raised in report
According to Plecas’s report, in the spring of 2018, James asked Plecas to sign a “retirement allowance” form that proposed a transition payment for executives who resigned or retired after working for more than 10 years at the legislature. This would entitle the clerk, the sergeant-at-arms and the executive financial officer to 12 months of salary after they retired. Plecas calculated that would cost taxpayers more than $1 million. For James, who earns a salary of $347,090, it would amount to more than $300,000 “on top of his sizable pension,” Plecas wrote.
Plecas said he decided to sign the form so that James would not dispose of the draft. He later rescinded the benefit.
Plecas wrote that when he told deputy clerk Kate Ryan-Lloyd about the request, she replied: “I can’t believe he’s doing it again.”
In 2012, under then-speaker Bill Barisoff, James received a $257,988 “retirement benefit,” even though he did not retire. The report said Barisoff justified the payments, which were also made to clerk assistant Robert Vaive, Ryan-Lloyd and law clerk Ian Izard, because he was ending the benefits program. Ryan-Lloyd returned the money a year later.
Plecas’s report suggests James tried to hide the payment by asking for it not to be calculated as part of his salary for 2012.
“At no time in any way, shape or form was he eligible for that,” the Speaker’s chief of staff Alan Mullen told reporters Tuesday.
“Even if he was eligible, which he wasn’t, he didn’t retire. He recently sought a further $300,000 as a retirement allowance. It amounts to nothing short of madness.”
The 2012 retirement payments were flagged in then-auditor general John Doyle’s audit of the legislative assembly, in which he detailed $660,000 in “unusual compensation” to four unnamed senior legislative bureaucrats. Then-director of human resources Jo-Anne Kern analyzed the payouts in a 2014 report that has since disappeared from the Speaker’s vault.
Whistleblower fired for raising concerns: report
The report alleges that a whistleblower was fired for raising concerns about a Liberal MLA’s expenses. A former legislative assistant, working for several Liberal MLAs around February 2018, told Mullen that one MLA was submitting improper expense claims, such as claiming for vehicle mileage when a taxi was taken and claiming full-day meal expenses when meals were provided. The staffer told the MLA he believed some of the expenses to be improper and was told to submit them anyway.
Without mentioning names, Mullen told Lenz about the behaviour, which piqued the sergeant-at-arm’s interest. The staffer was fired in May 2018. The staffer believes he was fired for refusing to do something unethical, the report says.
The fired staffer met with Lenz, Mullen and deputy sergeant-at-arms Randy Ennis in June 2018 to outline his concerns. Hours after the interview with the staffer, Lenz told Mullen he looked into the expense claims and found everything was explainable, despite the fact that he did notice two instances of double dipping for mileage and taxi fares.
James, who was on a trip to China with Plecas at the time, knew about the staffer’s allegations and said he had told Kate Ryan-Lloyd to rein in Lenz, “otherwise we will all wear it.”
The staffer was eventually told by Ennis that his allegations were unsubstantiated.
Plecas wrote that “any officer who takes steps to summarily quash an investigation … with an express justification of protecting expense recording patterns and insulating them from review” is a serious matter that needs to be looked into.
Green Party Leader Andrew Weaver said allegations that documents raising concerns about the retirement payments disappeared and that there was pressure to quash investigations into questionable expenses hints at “a culture that, at best, turned a blind eye and, at worst, actively concealed these actions.”
“These issues do not happen in a vacuum,” Weaver said. “They are enabled by a culture that chooses not to ask questions and treats power as an entitlement to be protected rather than a public responsibility to be stewarded.”
Taxpayers allegedly picked up tab for suit
Plecas alleges James billed taxpayers for suits, dress shirts and ties under the guise that they were part of his clerk’s uniform.
The report says that James was reimbursed for $966 worth of clothing purchased at Brooks Brothers in February and September 2018, including seven dress shirts and a tie. On the receipt, the word tie is crossed off and “tabs” is handwritten in. James’s house uniform includes judicial tabs, not neckties.
During a trip to London, James purchased a $1,000 grey suit from Ede & Ravenscroft and then changed the receipt to say the suit was black. The legislative assembly attire is a gown, vest, black-striped or grey-pinstriped pants, and tabs, not a suit, the report said.
Cash payouts in lieu of vacation
Plecas raised questions about the longstanding practice of cash payments made to James and Lenz in lieu of vacation. The two men took very few vacation days each year, which is against legislative assembly policy that staff must use at least 15 vacation days annually.
James and Lenz took regular time off and holidays but do not record them as vacation days, the report alleges. Several staffers told Plecas that James is rarely seen at work on Fridays.
Lenz went at least two years without taking a single vacation day, the report said.
Plecas said there’s evidence James might have been taking these payouts in lieu of vacation since he was hired in 1987.
As a result, James and Lenz received unbudgeted cash bonuses that, in some years, amounted to nearly one-fifth of their salary.
Wood splitter delivered to home, report claims
A $3,200 wood splitter and $10,029 work trailer were expensed to the legislative assembly but were delivered directly to James’s home, where the equipment was used by James and Lenz, the Plecas report alleges. A receipt shows that the wood splitter was picked up by “Craig.”
When Plecas asked why the legislative assembly would purchase a wood splitter, he was told it could be used to cut fallen trees to use for firewood in the course of a “crisis situation.”
Even if this rationale passed muster, Plecas wrote, it’s difficult to understand why the equipment would be kept at James’s personal residence. A letter from James’s lawyer said his client was “holding” the wood splitter because there was no room in the legislative precinct.
Through his lawyer, James offered to return the splitter in December 2018. It was seized by the RCMP.
Both the wood splitter and work trailer now sit on the grounds of the B.C. legislature.