Ernst & Young’s $660,000 report on impact of altering Peel Region likely to be a day late and a dollar short

The controversial Deloitte report that said dissolving Peel Region is the most expensive local option in the province’s review of regional governance was roundly attacked by the mayor and regional councillors from Mississauga, who argued with its methodology and secrecy. A second study of the implications of changes to regional government by auditing firm Ernst & Young, ordered in response to the controversy, will tread much of the same ground at greater cost — and it could end up being submitted to the province incomplete or practically sight-unseen by regional council and the public.

The bungling of the entire process set the tone for the latest showdown over the future of Peel Region.

At Thursday’s Peel council meeting, residents learned that there may not be enough time to conduct the latest audit, as the provincial deadline of May 21 for municipalities to submit their input is fast approaching. That leaves less than 12 days, as of the date of the latest council meeting, to conduct the review, less than a month after the new audit by E&Y was requested to study the effects of dissolution, amalgamation and the status quo. By comparison, Deloitte was commissioned to do its work in January, and the findings were made public in April, roughly three months later.

Peel council was recently shown a video of Chair Nando Iannicca when he was a Mississauga councillor, appearing to contradict his stated position that Peel Region should stay intact 

Even if the new audit is completed in time to hand over to the province, its impact is questionable, as there will be no time for councillors, the three mayors, the regional chair or the public to use the findings to lobby for a desired outcome. The province has made clear that all of its decision making to determine the future of the eight regions under review will be done behind closed doors. That includes any findings handed over by the provincial advisers who have met with representatives of the regions and members of the public prior to making their recommendations to the province.

Peel Chair Nando Iannicca said Thursday that he asked the advisers if there is any wiggle room with the deadline set for receiving feedback.

“I put the question to the two supervisors [of the regional governance review, Ken Seiling and Michael Fenn] yesterday and they were not confident that they would get leeway from the provincial government,” Iannicca said in response to Brampton Mayor Patrick Brown’s question about whether it was possible to get more time to do the report. “They [have] their own political masters, and it’s the province.”

Council set aside $660,000 for Ernst & Young’s work (which includes a legal position from another firm), on top of the $325,000 already spent on Deloitte and partner Watson and Associates — a split commissioning process conducted by Peel Region staff without council’s approval that may have also violated the region’s procurement bylaw.

The study by E&Y may need to be a “walk-on,” not revealed to the public prior to the next council meeting, meaning that residents will not have a chance to read and interpret the report for themselves, and councillors will have little time to absorb the contents before it’s handed in to the province, which will deal with the entire matter of the regional review behind closed doors before making its decision on the future of Peel and the other seven regions that are under the microscope.

“At least if we have a copy of it prior to May 21, when we make submissions, we’ll have the ability to [discuss it],” Brown said in the meeting. “As long as everybody has a copy prior to May 21, it doesn’t need to be a week” to achieve that objective, he said.

Brown, the first of the municipal representatives to receive the Deloitte report — a fact that provoked resentment among the Mississauga councillors, whose support for seceding from the region is contradicted by its findings — took the time to defend that report, saying he was “satisfied” by its conclusions.

“Out of fairness to Mississauga, since there is doubts on Deloitte, that’s why we did this process,” Brown said, insisting nevertheless that if the Ernst & Young report isn’t done in time, “Deloitte is the only financial analysis done by the region, and it will be our submission as fact.”

Regional CFO Stephen VanOfwegen said he does not expect the report to come in before May 21 as the target is to have it submitted to a steering committee on the very day of the provincial deadline for submissions. “The steering committee needs to endorse the work before it goes to council so that we’re not bringing a product to council that council is not comfortable with,” VanOfwegen told Brown.

Mississauga and Regional Councillor Dipika Damerla

Mississauga Councillor Dipika Damerla expressed concern about submitting the Deloitte report by “default,” the only resistance to Brown’s assertion that it might need to be submitted in the event the Ernst & Young report was not ready.

“Sometimes there is a draft to these [reports] as well. Perhaps if there is going to be a final report on the 21st, I can guarantee you there is draft around the 19th,” Damerla said in council.

She added: “I’m quite concerned if we don’t make the 21st deadline, I don’t want the other report to, by default, be presented. If that were the option, then I would very much want a motion that would say Mississauga had these concerns.”

The Deloitte report provoked fireworks at earlier council meetings, with complaints coming from Mississauga councillors that the report was commissioned without their knowledge, did not consider certain important factors, was completed with any consultation with municipal leaders — and was released to Brown before Mississauga councillors even learned of its existence.

The discussion came to an end when Mississauga Councillor Carolyn Parrish tabled a motion to send the report straight to the province without anyone having seen it. “Ernst & Young have been hired, they’ve been given the criteria, what are we going to influence?” Parrish said. Her motion passed.

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