Auditor General Michael Ferguson is calling for “transformational change” in the Senate after a damning audit found that many senators allegedly broke the rules and submitted ineligible expense claims.

Ferguson’s long-awaited report has found a lack of independent oversight and accountability in the way senators’ expenses are governed.

The report makes a number of recommendations, including “transformational change” in the way senators’ expenses are claimed, controlled and reviewed. The report also says that an independent body should have oversight of Senate expenses.

“Simply changing or adding to existing rules will not be enough,” the report says.

“Improvements in oversight, accountability, transparency, and Senators’ consideration for the cost to taxpayers are needed to resolve the issues that we have identified.”

At a news conference Tuesday afternoon, Ferguson said the Senate’s Internal Economy Committee has exclusive authority when it comes to managing Senate resources and dealing with senators’ expenses. But the committee is made up of individual senators who also file expenses, so there is a lack of independent oversight, Ferguson said.

The audit examined all expenses incurred by 116 sitting and former senators between April 1, 2011 and March 31, 2013. It found many instances where senators did not consider the cost of their travels and other claims, which are paid by taxpayers. Information provided by senators to support their expenses was “often insufficient,” the audit found.

“What really struck me was the extent to which it seemed to have been ingrained in senators – in many of them, not all of them – that they didn’t have to be accountable, they didn’t have to be transparent with the spending,” Ferguson later told CTV’s Power Play.

Among the audit’s findings:

Instead of sending out standard holiday greeting cards, some Senators chose to buy more expensive, customized cards at an overall additional cost of $30,000.



One senator and his spouse claimed travel expenses for personal events, including a golfing session and a fishing trip.



A $3,452 expense claim from another senator who travelled to Toronto to attend the anniversary of a curling club.



“Significant” cellphone roaming charges incurred by senators and their staffers that could have been “easily managed.”

The audit flagged 30 former and sitting senators who incurred expenses that were deemed “not in accordance” with Senate rules or did not fit the definition of “parliamentary business.”

Nine senators’ expenses were referred to the RCMP on Friday. They are:

Nearly all nine senators responded to the audit and their comments were included in Ferguson’s report. The senators’ defended their expenses and disagreed with the audit’s findings.

Donald Oliver, for example, said the analysis of his expenses was “not factually correct.” Gerry St. Germain wrote that he finds the “apparent accusations” against him “to be a defamatory affront to my personal integrity.”

The senators whose expenses were not referred to police have two options, Senate Speaker Leo Housakos told reporters Tuesday. They can either repay the money or take their case to former Supreme Court justice Ian Binnie, an independent arbitrator appointed by the Senate to specifically deal with disputed expenses.

Conservative Sen. David Tkachuk, who used to chair the Internal Economy Committee, is among the 21 senators whose expenses have been flagged, but not referred to the RCMP.

The auditor’s report says Tkachuk owes $7,391. He told Power Play Tuesday that he will repay $3,900, but disputes the rest. The remaining amount involves travel to Toronto and Ottawa, Tkachuk said.

“I’m going to take those to arbitration because the auditor general was wrong,” he said.

Some expenses repaid

Housakos was among three leaders in the Senate whose expenses were flagged in Ferguson’s report. On Monday, he announced that he will pay back $6,770 and not seek arbitration because he doesn’t want others to question the “integrity of the process.”

James Cowan, who leads the Liberal-appointed members of the Senate, also said he has repaid more than $10,000, even though he disagrees with Ferguson’s findings.

Some other senators flagged in the audit have also either partially or fully repaid their disputed expenses.

In a memo obtained by CTV News before the audit was released, Cowan told other Liberal-appointed senators that it would be "unwise" and "premature" to accept the auditor general's report without reviewing it first.

"It took the AG two years to produce this report," Cowan wrote in the memo obtained by CTV’s Ottawa Bureau Chief Robert Fife.

"Much more study and consultation needs to take place on our part before any recommendations can be accepted or rejected."

Cowan told reporters Tuesday that senators will “quickly and carefully” consider the recommendations.

“The responsible thing to do is to take the time necessary to look at it,” he said.

Housakos said Tuesday that the Senate will look at all the recommendations and institute them “step-by-step.”

The high cost of the audit

Ferguson told reporters Tuesday that the final cost of his Senate audit will be around $23.5 million.

Asked whether the amount is justified for efforts to recover less than $1 million in allegedly improper spending by senators, Ferguson said he’s “not happy” about the high cost, but is “convinced” the audit was necessary.

“What we’ve done here has value beyond that,” he said, adding that he believes the audit will “tighten up” expense claims and change behaviour in the Senate.

If the Senate had a “proper audit regime” and had been transparent and accountable when it came to expenses, “we never would have had to spend that amount of money,” Ferguson told Power Play.

He also said a full audit was necessary in the wake of the Mike Duffy trial, because Canadians were wondering about other senators’ expenses.

Duffy, a former Conservative senator, is facing 31 charges, including breach of trust, fraud and bribery, related to his living and travel expenses. He has denied any wrongdoing.

Retired senator Mac Harb and suspended senator Patrick Brazeau are also facing charges related to their expense claims. None of the allegations against them has been proven in court.

An RCMP investigation into suspended senator Pamela Wallin’s expenses is ongoing; she has not been charged.

‘A damning expose’

In the House of Commons, NDP’s ethics critic Charlie Angus called Ferguson’s report “a damning expose of the Senate.”

“We are learning that they were flying first-class to do corporate business and personal pet projects and the auditor general has once again flagged that we have to end this issue of self-policing,” he said during question period Tuesday, accusing Prime Minister Stephen Harper of ignoring the Senate scandal.

Paul Calandra, Harper’s parliamentary secretary, responded by saying that “there is not unanimous support to modify the Senate,” so the government is going to focus on “jobs and growth.”