Ontario's auditor general to investigate financial debacle at Laurentian University

Nickel Belt MPP France Gélinas has received support in the Ontario legislature to have the provincial auditor general investigate exactly what happened at Laurentian University.

The school recently eliminated 39 per cent of its programs, laying off staff and cutting $30 million from its budget. That was only possible because the university declared insolvency under the Companies' Creditor Arrangement Act.

Last week, Gélinas introduced a motion to the standing committee on public accounts to have Ontario Auditor General Bonnie Lysyk do a complete review of the situation and it passed.

"How could it be, years after years, KPMG does an audit of the university and they tell them everything is good and then eight months later we're $200 million in debt?" she asked. "How could you explain this?"

Gélinas said she was pleasantly surprised at the support she received, even from some on the government side of the legislature.

"I think (Conservative) MPP Toby Barrett said it best when he said 'I had no idea this was happening in your community,' and they voted in favour of sending the auditor to Laurentian University to get to the bottom of what happened financially," she told CTV News.

There have been a lot of calls for an inquiry in the wake of so many people losing their jobs but Gélinas said this will get the community the answers it needs faster, and her audit will be made public.

"The auditor general is an officer of the Legislature and being an officer means she comes with a ton of power," she said.

"She has the right to enter a premises, whether she's welcome there or not; she has the right to have access to documents whether they are private or not; she has the right to ask questions and people have to answer."

"She will be able to tell us if those are good, bad or terrible decisions that they've made," she added.

The auditor general has not said publicly when she and her team plan to arrive but Gélinas said it will be soon. She said the auditor general's report would take months, as opposed to years for an inquiry.

Gélinas is not the only one that wants the situation investigated. Retired homicide investigator Craig Davies said he has been talking to anyone who believes they are owed money by Laurentian and plans to hand his findings over to the auditor general's team.

Davies, the son of the former Regional Municipality of Sudbury Chair Tom Davies, said he just couldn't sit by and watch.

Physics program eliminated

"I am a retired person, a concerned person who has a lot of time on my hands and I was concerned about the situation as many people are at Laurentian University," he said. "It's one thing to talk about it but I come from a background where if you have the ability to do something about it, then you do it."

He said it was the elimination of the physics program that specifically motivated him to get off the couch.

"We are literally changing the world and the physics lab at Laurentian is the home lab for the Sudbury Neutrino Observatory (SNOLab), not only that but it also looks after the radiation technician program," Davies said. "It's a travesty with what they've done with these people."

"All we want is the truth. We're not accusing anyone of anything. We just want to hear the truth and we haven't been told that yet."

The retired investigator said no one is saying there's financial wrongdoing, but the community is suspicious and deserves answers.

Davies has been inundated with people reaching out to him with heartbreaking stories.

"I read these stories of these people," he said, choking up. "I will not let them down, that I can promise you."

In the meantime, the Canadian Taxpayers Federation is calling on the province of Ontario to maintain its current course.

No bailout

It says Laurentian should not be getting a bailout.

"If the provincial government were to simply bail them out now, that would be like paying off your child's credit card bill that's maxed out without teaching them any financial responsibility," said interim Ontario director Jay Goldberg.

"So we think it's really important for the university to take financial responsibility for some of the errors of the past."

Many of the details surrounding Laurentian's insolvency are shrouded under secrecy due to a confidentiality clause under the CCAA process. It's led to some like federal MPs Charlie Angus and Paul Lefebvre calling for reforms to be made to creditor protection.

Angus said in a recent debate he feared other governments would allow universities to use this measure to avoid their provincial jurisdiction.

Goldberg was asked about that and didn't see it the same way.

"I think Laurentian is in this problem because it has an expense problem, not a revenue problem," he said.

"Tuition fees that the university has taken in have gone up by 74 per cent between 2010 and 2020, so they've actually had a lot of new revenue coming in from tuition fees and yet they're still running deficits."

Laurentian's creditor protection has been extended until the end of August.