Auditor General Denise Hanrahan identified serious oversight and policy compliance issues in her inaugural audit of Newfoundland and Labrador’s government-run oil and gas company, formerly part of Nalcor Energy and now known as the name OilCo. The organization notably ignored Treasury Board instructions on employee classification, raising concerns about the management of taxpayers’ money.
Despite the provincial government’s request to align occupational classifications with public sector standards, OilCo executives chose to continue with a market-based salary plan, leading to significant disparities in compensation compared to government positions. . This divergence in pay scales is illustrated by CEO Jim Keating’s annual earnings, which significantly exceed those of equivalent positions in the public sector.
The province’s auditor general noted that OilCo’s misuse of public resources manifested itself in excessive spending on telecommunications, office rentals and travel expenses. For example, devices associated with former employees have incurred charges long after they left, with active data plans and unused cellular service costing the company hundreds of dollars.
In the area of office fittings, the audit revealed significant financial commitments linked to the rental of furniture and other office supplies. Additionally, costs related to artwork and office preparation at OilCo’s headquarters have added up, resulting in significant long-term expenses.
OilCo’s travel practices also deviated from provincial guidelines, with two staff members opting for costly business class upgrades while traveling abroad, apparently without adequate justification.
Additionally, the company’s compliance with conflict of interest policies was lacking until recent updates, with a lack of formal training and certifications for board members, employees and contractors. concerned.
Hanrahan’s assessments resulted in five recommendations aimed at correcting these gaps. Although the majority was accepted, OilCo strongly rejected the proposal to align job classifications with government directives, signaling ongoing tensions between the Crown corporation’s internal policies and provincial expectations.
