P.E.I. Premier Wade MacLauchlan has told CBC News he will send the controversial e-gaming file to the province's auditor general for review.

MacLauchlan says having Auditor General Jane MacAdam look into the province's failed effort to become an e-gambling hub is a "more suitable way to get to the facts" than a judicial inquiry — which NDP Leader Mike Redmond called for earlier this week.

Speaking to CBC News Compass host Bruce Rainnie Wednesday afternoon, the premier added, "I will ask the auditor general to look into this and I will clearly express that this is not the way I do business and that I'm looking, as a premier, to put in place a number of measures that will ensure, as we move forward, everything that government does will be on a highly ethical basis and will build the public's trust and confidence."

He also says MacAdam could provide advice for government on mistakes that have been made and offer ways to "put in place better processes for the future."

The province's public accounts committee sent a request for the auditor general to investigate the issue on Feb. 12.

Being ethical to me isn't pulling off all the scabs. - Premier Wade MacLauchlan

A Globe and Mail story published on Saturday has re-opened the debate over how the Liberal government explored the possibility of getting into online gambling regulation.

The article also suggested some current and former provincial employees and an advisor invested in a company poised to do business with government.

"I think, in the main, the facts that were in the Globe piece were known going back a couple of years, with P.E.I. journalists who've identified this issue and brought it out ... So in a sense it wasn't news," MacLauchlan said in an interview on CBC Radio's Island Morning Wednesday morning.

"Overall, I would say the article was written to prove the case that we are too small to be real. And my general view of the world is that we have to keep reminding people that small can be big."

'Backward and incestuous'

The new premier explained that both print and broadcast media on P.E.I. had reported extensively on the e-gaming issue, including the $950,000 loan the Ghiz government gave the Mi'kmaq Confederacy to explore the possibility of setting up e-gaming regulation.

The loan was eventually written off by the province because the plan fell apart due to legal technicalities.

Premier Wade MacLauchlan will be handing P.E.I. Auditor General Jane MacAdam the e-gaming file. (CBC) MacLauchlan said he sees no reason to hold an inquiry into the e-gaming efforts, or who stood to benefit if the plan to be a global gaming centre materialized.

"I do not think a judicial review would benefit us one bit," said MacLauchlan.

"We spend a couple of years with a whole lot of legal bills making ourselves look, as Mr. Redmond said in the Globe and Mail yesterday, backward and incestuous ... My purpose here is for P.E.I. to learn and be a place that can progress and to do better," said MacLauchlan.

"Being ethical to me isn't pulling off all the scabs."

New conflict-of-interest rules

Instead, the premier has announced new conflict of interest rules expanding the number of employees and government officials falling under the legislation.

"I do think that there is room for us to up our game in terms of ethics and the standards that we have for employees," he said.

The new rules will mean P.E.I.'s deputy ministers and senior government advisors will operate in a blind trust while working with the province, a rule previously applied only to elected officials.

In addition there will be a six-month cooling-off period once a senior government minister or senior advisor leaves employment with the province.

MacLauchlan did point out that the province already has policies in place for all public servants about disclosure and conflict of interest.

MacLauchlan said this week's announcement is not a response to the Globe article.

"This is obviously something as I've said, that could have been done long ago, and I'm glad that it has been done," he said.