The Conservative Party of B.C. is calling for an investigation into the bankruptcy of Small Business BC.
Conservative Kelowna-Mission MLA Gavin Dew said in a statement that an independent investigation by the Office of the Auditor General is "essential to restore trust and ensure accountability" after the non-profit organization supporting small business has filed for bankruptcy last week.
Dew said the "collapse" of SBBC "not only disrupts essential services to small businesses but undermines public confidence in the management of taxpayer funds" as the organization has received funding from both provincial and federal governments.
"We will have to get to the bottom of what exactly has happened here," Dew said in an interview with Black Press Media before the formal investigation call. "The fundamental question is when and how this happened."
The party's appeal for an investigation to acting auditor general Sheila Dodds highlights four areas of concern: impact on stakeholders; financial management; governance and accountability; and government oversight.
"We are now learning via the media that there appears to have been financial mismanagement," Dew said. "The government appears to be trying to back away and say 'we've got nothing to do with with this arm's length organization, but the government had a role on the board, which accompanied its very significant financial contribution."
Available figures peg the combined provincial contributions to SBBC at around $10 million annually for core services and various programs, including support for businesses looking for export markets abroad as well programs supporting individuals with disabilities in the workplace.
Dew said the provincial government should have been much more alert to the situation. "Bankruptcy doesn't happen overnight," he said. "If something happened here, it happened over a period of months."
Dew said SBBC is not "some random community" but a long-established non-profit who origins date back to 1986 and has received significant financial contributions.
"Is the government now scrambling to get free of the blast radius as issues come to life?" Dew said.
He added that provincial as well as the federal representative on the board of "should have been the board members who were most aggressive scrutinizing how every nickel of taxpayers' dollars were being spent by this organization."
B.C.'s Jobs Ministry said in statements to Black Press Media that SBBC is an independent non-profit organization, adding that the province does not have oversight of SBBC's financial operations.
According to the statements, the government funding partners received notice in late October of the financial difficulties facing SBBC, followed by an update about actions in November. The province then received notice of the bankruptcy filing on the day it happened: late Dec. 4.
The ministry said its priority now is making sure that any taxpayer dollars are protected and "that that money is recovered by the province."
The ministry has directed specific questions around the finances of SBBC to the MNP trustee handling the bankruptcy.
Federal Emergency Minister Harjit Sajjan, responsible for the Pacific Economic Development Agency of Canada, said in a statement that his office is aware of SBBC's bankruptcy.
"Along with the (provincial government) and many other partners, PacifiCan supported SBBC as it provided small businesses across our province with valuable resources and services, Sajjan said, adding that PacifiCan will work with partners to understand the impact of this announcement, while continuing to support the needs of small businesses.
"PacifiCan is committed to ensuring the sound stewardship of public funds allocated to support small businesses across British Columbia," Sajjan said.
He added that SBBC91ÂãÁÄÊÓƵ™s bankruptcy means that it has defaulted on its funding agreements with PacifiCan. "(As) a result, PacifiCan has suspended further payments under these agreements," he said. "PacifiCan will work with SBBC91ÂãÁÄÊÓƵ™s representatives and its appointed trustee, MNP Ltd., through the bankruptcy process."
Black Press Media has reached out to the trustee handling the bankruptcy for additional information as well as B.C.'s Jobs Ministry for comment about the Conservatives' call for an investigation.
