VICTORIA — The British Columbia government is restricting new funding to a major non-profit housing providerand reviewing its finances afteran independent report found mismanagement by a former top executive atthe province's housing corporation.
The forensic investigation by Ernst and Young says it uncovered "significant risks to public funds" stemming from mismanagement and a lack of oversight at BC Housing, the Crown corporation that develops and manages subsidized housing.
In particular, the probe revealed mismanagement related to a conflict of interest between the former CEO, Shayne Ramsay, and his spouse, Janice Abbott, the CEO of Atira Women's Resource Society, the corporation's largest housing operator.
The review found Ramsay repeatedly influenced decisions that benefited Atira, and a lack of oversight by the agency's board "resulted in a culture whereby it was deemed acceptable to tolerate non-compliance with (conflict of interest) policies."
The probe found Atira bypassed traditional communication channels and went straight to senior members of the Crown corporation for funding requests.
Atira was also awarded contracts directly, "without transparent, competitive processes designed to ensure the proper use of public funds," the report says.
While the investigation uncovered financial mismanagement, it did not find evidence that public money had been stolen, Premier David Eby told a news conference shortly after the report was tabled in the legislature on Monday.
Eby said efforts to conceal certain activities from the government and the public, including allegations that BC Housing executives had deleted text messages and altered meeting minutes, are among the probe's most troubling findings.
He said that while BC Housing was now in a "much better place," he still has "deep concerns about the situation at Atira.”
Ramsay did not immediately respond to a request for comment sent to his new employer, Nch'kay, the economic development arm of the Squamish Nation.
Abbott, through Atira, did not immediately respond to a request for comment.
Eby said the review will ultimately strengthen B.C.'s response to the housing crisis.
The government received the report in March, but just released it Monday, saying it has already implemented several of the 20 recommendations aimed at improving financial oversight, preventing conflicts of interest and ensuring accountability.
Housing Minister Ravi Kahlon told the news conference that BC Housing's new leadership has committed to implementing all 20 recommendations by next spring.
In addition to restricting new funding to Atira, the province will physically inspect Atira-operated buildings and suspend the renewal of agreements with Atira until a review of the operator's financial transactions related to BC Housing is complete.
The premier said he knows the findings will likely cause anxiety among people in buildings run by Atira, but he assured those residents their housing is secure.
"For people who are currently living in government-funded housing that's managed by Atira … (the) financial support that provides and enables the staffing for that housing, that keeps that housing open, that subsidizes rent, will continue to flow."
However, Eby said there's been a freeze on funding for new buildings to be managed by the organization, as well as any contracts for new programming.
Asked whether mismanagement may have occurred in relation to any other housing providers, Eby said an earlier review by Ernst and Young identified concerns that were "very specific" to Atira and Ramsay and Abbot's relationship.
The B.C. government released the results of the previous review last June, a week before announcing it had fired several BC Housing board members.
Eby, who was the minister responsible for housing at the time, said the government commissioned the review to ensure the corporation could deliver on its mandate, considering B.C.'s plan to spend $7 billion on affordable housing over 10 years.
Ramsay announced his retirement a few weeks later, saying he no longer had confidence he could solve the complex problems the corporation faced.
During the course of the first investigation, Ernst and Young had brought forward information suggesting Ramsay had been violating conflict-of-interest rules, prompting Eby to request the full forensic investigation, the premier said Monday.
Asked whether he thought Abbott should be fired or resign as CEO of Atira, Eby said the government expects the housing provider to take steps to ensure public confidence in its operations, and one of those steps could be leadership change.
"That is something that BC Housing has asked for," he said.
Speaking in the legislature later Monday, BC United House Leader Todd Stone accused Eby of burying earlier warning signs about financial mismanagement within Atira while overseeing increases in provincial funding for the housing provider.
Eby said he agreed with Stone that it's "concerning that it was particularly Atira that saw the spike in funding recommended by BC Housing to this government, which we did fund" in order to address the housing crisis during the COVID-19 pandemic.
"We do not accept the conduct that took place at BC Housing, and our work is not yet done," the premier said.
— By Brenna Owen in Vancouver
This report by The Canadian Press was first published May 8, 2023.
The Canadian Press
Note to readers: This is a corrected story. A previous version said Todd Stone was with the BC Liberal Party.