Corruption, incompetence, theft in NL health system
Liberals face another scandal as election looms
The first of three reports by the Auditor General into contract nurses dropped Wednesday.
To start, here are some highlights, with bolding added. The category headings are mine.
Theft
“There were strong indications of potential billing fraud by Agency A for electric vehicle rentals.”
“In total, Agency A invoiced and was paid $91,529 for 81 weeks of electric vehicle rentals for nurses that were not in the province. A further $8,372 was paid for seven weeks in which the nurse was in the province for only part of the rental period. Moreover, we found $227,622 was paid to Agency A for electric vehicle rentals without any indication of who was supposedly using the vehicle. In summary, $327,522 was paid for the rental of electric vehicles to nurses who did not appear to have the vehicle, or where usage by a nurse could not be verified. This amount represents 60 per cent of the total paid to Agency A for electric vehicle rentals.” (Page 29)
Illegal Contracts (also theft) and Corruption
“Forty-nine Newfoundland and Labrador Health Services employees entered into 53 leases in violation of conflict of interest legislation.”
“In total, almost $1.9 million in rent was paid to these employees by the health authorities between 2022 and 2024.”
“Employees who provided these properties to Newfoundland and Labrador Health Services charged well above market rates. On average, a 90 per cent premium was charged for these properties, as compared to average market rates.”
Corruption
“[The Government of] Newfoundland and Labrador did not identify or act on any of these instances of conflict of interest before the issue was raised externally.”
“There were shortcomings with conflict of interest policies and procedures, that may have enabled conflicts to remain undetected.”
“The health authorities failed to issue an open call for bids for any of the agency nursing contracts signed during our audit period.”
“Eleven of the 15 agency nursing contracts signed between January 2022 and June 2024 used emergency exemptions, which was inappropriate.”
“Newfoundland and Labrador Health Services’ public statements on agency nursing reduction were misleading. In February 2025, the authority’s CEO provided a public update, indicating agency nurse usage had been reduced by 42 per cent from its highest point. It was misleading to draw attention to a 42 per cent headcount reduction, without being transparent that costs did not show a comparable decrease.”
Gross Mismanagement and Chronic Incompetence
“Newfoundland and Labrador Health Services developed a plan to reduce the use of agency nurses, but it lacked detail regarding how targets would be achieved.”
“There was little evidence of a spending reduction trend in the quarters leading up to March 31, 2025.”
“Newfoundland and Labrador Health Services achieved its overall agency nurse headcount targets for March 2025…” [but only because the agencies couldn’t supply the number of nurses requested.]
“Newfoundland and Labrador Health Services’ cost per agency nurse for the year ended March 31, 2025 was at least $404,486. By way of comparison, the total of salary and benefits for a registered nurse at the midpoint of the collective agreement salary scale was estimated at approximately $118,750 at the end of 2024.”
“The health authorities did not review agency performance throughout or following completion of contracts.”
The Board of Trustees (nominally responsible for overseeing the health authorities) did not keep adequate minutes of meetings during the period covered by the review.
Plain Language.
That confirms what was already public about the scam in Central Newfoundland that politicians and bureaucrats covered up in 2024 when - on the face of it - the thing should have gone to the police. The Auditor General has added new details with now a second example of fraud beyond the housing scam in Central Newfoundland. The Auditor General’s report also shows the extent of mismanagement and bureaucratic bungling, incompetence, and corruption within the provincial health authority and government health bureaucracy.
Now let’s look at two more issues: who is implicated (knew about the scandal, did nothing to fix the problem, enabled the scam, or covered it up) and what is likely to happen to all of this.
We’ll just look at the people right at the top of the political side of things for those implicated. Lots of people knew about this before someone blew the whistle in 2024, including the folks in Central Newfoundland to a very high level of the organization most likely.
Implicated:
Andrew Furey. The Premier at the time this contract nurse business started and the Premier as it grew.
John Hogan. Current Premier, former health minister, and former Attorney General. Hogan was Attorney General when Tom Osborne received a letter alleging corruption in the central health authority. When the story hit the news media, Hogan misled the public about what he knew before he replaced Tom Osborne briefly as health minister. We don’t know fully Hogan’s role in shaping the cover-up of the scam in Central but as AG as as a Furey confidant within Cabinet he certainly should have played and likely did play a role in managing the scandal.
Tom Osborne. Health minister during the whole time of the contract nurse scandal. from his appointment in 2022 to his resignation in July 2024.
Pat Parfrey. Appointed deputy minister of health transformation in 2022, Parfrey reported directly to Andrew Furey during the consolidation of the health authorities into one and became the chief executive officer of the health authority this year. How early on he knew about this scandal remains to be seen. His initial defence of the corruption this - we needed nurses desperately to deal with the COVID aftermath - doesn’t explain why the system is now institutionalized or why he lied to the public about hitting targets when he knew the health authority didn’t.
Ken Carter. Director Policy for Andrew Furey and John Hogan. According to a Globe and Mail story in February 2024, Carter took the phone call from Agency A that led to their contract to supply nurses to the provincial government’s health authorities. Carter is just the one named. Since Furey was the de facto health minister regardless of who actually had the job, what happened in Furey’s office and the role Furey and his senior advisors (chief of staff, deputy chief of staff, communications director, assorted SPADs) played in the contract nurse scandal will be a crucial part of any future inquiry by a commissioner or the police.
What will happen?
Two of the largest scandals in Newfoundland and Labradors history involved health care and happened within the past 20 years. In both the breast cancer fiasco and COVID, hundreds of people died as a direct and indirect result of incompetence, mismanagement, and garden variety bungling. No one paid a price except the dead, the sick, and their loved ones.
In other scandals involving misspent public money - whatever happened to the paving inquiry? - or the incredible tales from the electoral office, nothing happened at all.
Don’t expect much to happen in this case.
The media will likely be unwilling or unable to do much but chase someone else’s reporting (as with the Globe story in 2024) if anyone digs deeper into this scandal. They haven’t since last February so expect nothing new to come from local news media. Don’t expect many more stories on this and certainly none that come from the old-fashioned business of journalism in which reporters ask questions and don’t stop until they get answers.
Politically, this is the sort of story that should bring down the current government. Opposition politicians will make minor noises - as they did on Wednesday - but none of them will tackle this mess directly. It may not be much on an issue during the election everyone knows is coming simply because the Pea Seas will be - as they have been - chronically reluctant to pursue serious issues to their logical conclusion. If they didn’t come out of the health bureaucracy - like Tony Wakeham - they are otherwise compromised or generally reluctant to root out and put an end to the incompetence, mismanagement, and corruption that has bred this third major health scandal since the turn of the century.
This scandal may well be why so many people implicated left provincial politics once the story went public. Bear in mind some of them may well have known of issues *before* the rest of us did. As with the Auditor General’s report, the politicians and bureaucrats had a copy of Denise Hanrahan’s report long before the rest of us did. Did anyone in the health department flag rising nursing costs for the politicians, especially once the nurses union started asking harder and harder questions about it?
Keep an eye out for Hanrahan’s other reports.
Keep an eye out as well for the media lines from Parfrey and current health minister Krista Lynn Howell on this. Howell is just reading lines, as she did on Wednesday, including the news release that went out in her name but did nothing serious to address the concerns raised already.
At the same time, Howell’s comments to reporters on Wednesday were - to be generous - unbelievably naive. Howell said that “the lack of oversight and management of some of these contracts is certainly something that brings great alarm to us. And we wanted to ensure that this never happens again.”
Yes, it was, Minister. It should never have happened in the first place. It is still going on and the government - now led by one of the people who enabled the mess and last year helped cover it up - will not do anything to shut the mess down or prevent something worse from happening. If Howell is genuinely as concerned as her words sound, her best course, indeed her only action should be to resign. No one hold their breath waiting for that to happen.
What you are really seeing there is the extent to which many Cabinet ministers in Newfoundland and Labrador have absolutely no responsibility for or control over what happens in their departments. Control has been so centralized since 2003 that ministers who are not inside the circle of those favourites of the Premier’s Office just take the heat for other people’s bumbling and fumbling within the departments they are supposed to be running on behalf of taxpayers.
In that small way, Howell is already complicit in whatever is going on. After all, the Premier’s Office, Cabinet ministers, and senior health authorities had enough information last year to send this mess to the police but didn’t. What they propose to do now - hire someone to monitor budgets, etc - are all things they could have been done last year, should have been done anyway by departmental staff, and therefore speak to a lack of oversight and management in the health authority but within Howell’s department and in her own office.
Just remember, giving this mess to the Auditor General is part of the strategy John Hogan and others cooked up to bury the story rather than root out the incompetence and corruption at its heart. They may well have thought this report would come on the other side of the election expected last fall or in the winter. As it turned out, their initial planned failed but unless something changes radically, all the people involved in this scandal and all the people who are enabling it will escape any accountability for their failings, let alone what may well have been extensive criminal activity. Given the weak political reaction to the fraud already uncovered, there’s no guarantee it’s all stopped.
Related:
The columns linked below are in the Bond Papers Archive at Substack. To read them and the rest of the archive, to leave comments, and to support Bond Papers, become a paying subscriber.
Not-Responsible Government
The crowd currently running the place are nothing if they are not a funny bunch.
The Self-Licking Ice Cream Cone
Sister Elizabeth Davis used to run the regional health authority in and around St. John’s.
That dent won't buff out
The management strategy at the province’s giant health authority is to bluff their way through the crisis over the obvious corruption inside the organization until an Auditor General’s report …
We’re getting the results the system is set up to achieve (J Edwards Deming).
Consider the gong show at the new Corner Brook hospital- had to reopen up part of the old hospital.
It doesn’t matter how much money is thrown at the health care system. The parade of clowns running the place would f#%k up an anvil.
Oh my, oh my, oh my, ........for F**ks sake, making me swear (a word I never used before 2 years ago), I read this at almost noon, and no one commented yet! The arse is gone right out of her.
This seems about as bad as the scandals in the days of Sir Richard Squires, yet few seem to care. Some should be handcuffed, charged and then released on high bond while trails are scheduled. Or am I over reacting?
Parfrey, didn't know the difference between an MRI and a CT scan a decade ago, or deliberately misled the public on CBC TV. The plan seemed to be to take away a GPs ability to order a MRI and only a specialist could order it.......because of shortage of MRI machines here. He said MRIs have a lot of radiation, when CTs actually have a lot of radiation, so a danger to proper health care in some cases. Now he heads up Health Care here, and seems fit for a long term, or personal care home , to experience the neglect there, from poor oversight.
In 2018, HSC hospital had no bed pans at ER, so they used a cardboard liner, which collapsed and pee when everywhere.........in the biggest hospital in Nfld. This did not happen in Nain, but our capital city.
For monitor Blood Pressure over 24 hrs for outpatients, a small low cost device, they had only about 3 in the city, and had to share these between several hospitals here in St Johns!
They are 20 years behind in screening for lung cancer, a well proven procedure, very low radiation, and should be in place the same as breast or colon cancer screening.
For Blood pressure remote monitoring, they send out a cheap 80 dollar monitor, not even certified to standards cited in their literature. They refuse to send someone to set it up to enable the to transmit the data to their office.
A few years ago, cardiac people, at ER, gave up routine testing for seniors who have issues with blood pressure dropping when standing, which is a risk for fall and broken hips.
I could go on, but those in charge are obvious just dumb and dumber, crisis now turned to corruption.