Muskrat Falls critic says forensic audit falls short on pre-sanction scrutiny
Danny Dumaresque says period before and after 2010 fundamental to understanding what went wrong
One of the most outspoken critics of Muskrat Falls is questioning the effectiveness of a forensic audit into the project, saying it focuses too much on post-sanction spending and decisions.
"If you only look at post-2012 then you're missing what I figure is 25 to 30 per cent of the story and maybe the most fundamental part of the story," Danny Dumaresque told CBC News.
Dumaresque is a former member of the Newfoundland and Labrador Hydro board of directors, a one-time Liberal MHA and longtime critic of the over-budget and behind-schedule hydroelectric project.
He supports the commission of inquiry into Muskrat Falls, and says people will get a better understanding of the decision-making process, and how the project grew from an original budget of $5 billion when then-premier Danny Williams announced it in 2010, to nearly $13 billion today.
"I think there will be quite a bit of evidence to show that this project was based on false assumptions and obviously at the end of the day the key people involved should have to answer for that," Dumaresque stated.
But when inquiry commissioner Justice Richard LeBlanc announced this week that Grant Thornton will complete an investigative and forensic audit of Muskrat Falls, Dumaresque was disappointed by the scope of the audit.
The terms of reference for the audit include an investigation into the sanctioning of Muskrat Falls, including the options considered by Nalcor to address the future electricity needs of the province. It will also scrutinize the financial analysis conducted by Nalcor for the project, and for the so-called isolated island option.
The second phase will, among other things, investigate the costs incurred by Nalcor since the project was sanctioned by then-premier Kathy Dunderdale in December 2012.
So what's missing in all that?
It's the language that concerns Dumaresque. He says the first phase, like Phase 2, should also include an investigation of the costs incurred.
He said hundreds of millions of taxpayers' dollars were spent prior to the 2012 sanctioning by Dunderdale, and he's not convinced the forensic audit has the mandate to examine that spending, or how and why the decisions were made.
"When [former] premier [Danny] Williams and his government announced, along with the premier of Nova Scotia, that this project was on [in 2010], the deed had already been done. The die had been cast. And if the forensic audit is not going to look at that part, then I think that's a fundamental flaw."
One of the most fundamental aspects of the project was who was involved, and on what basis they decided to give out what money in the two years leading up to when it was officially sanctioned.- Danny Dumaresque
When Williams announced the project, the cost was estimated at $5 billion, but by the time it was officially sanctioned in 2012, two years later, the estimate had grown to $6.2 billion.
"If you're going to get a complete picture of this project, one of the most fundamental aspects of the project was who was involved, and on what basis they decided to give out what money in the two years leading up to when it was officially sanctioned," said Dumaresque.
The inquiry, meanwhile, provided the following statement in response to Dumaresque's concerns:
"Grant Thornton will be conducting its audit as outlined in our news release. It will conduct this audit independently of the commissioner."