While the public expresses outrage at the egregious spending on creature comforts by corporate executive, consultants, and government officials many would privately echo the sentiments expressed in the headline to an article in The Ottawa Citizen (August 14, 2009) – “How do I get one of these Jobs?”
A Small Sampling of Expense Account Exploitation
- On May 28, 2008 HRWorld.com reported on “Five Tales of Outrageous Expense Account Abuse.” Among the claims referenced was when six investment bankers from Barclays Capital went for a meal at a swank London restaurant: “When all was said and done, the bankers had run up an astounding $62,000 tab on wine alone (the restaurant at least comped their meals).”
- On May 14, 2009 BBC News reported that “Conservative MP Douglas Hogg has agreed to repay £2,200 ($3,900) - the cost of clearing his moat at his country estate- amid the continuing row over MPs’ expenses.
- On August 18, 2009, The Windsor Star reported that the Ontario government agency “eHealth…relied on consultants who charged between $2,750 and $3,000 a day. And some of those highly paid consultants nickel-and-dimed taxpayers for small expenses like a $1.39 muffin and $4.45 cream cheese bagel.”
Ontario Government Tightening Expense Account Rules
The Ontario government has been embarrassed by numerous expense account abuses at some of its agencies. The CEO of eHealth, Sarah Kramer, was fired, albeit with a severance package of $317,000.
Then, it was the turn of the Ontario Lottery and Gaming Corporation to be caught in expense account troubles. CTV News covered that story on August 31, 2009: “The entire board of the Ontario Lottery and Gaming Corp. (OLG) resigned Monday. They were replaced temporarily by provincial civil servants. Their first act involved the firing of Kelly McDougald, the agency’s CEO.” There was no thick severance package for Ms. McDougald who was booted out “for cause.”
With another spending scandal brewing at the Municipal Property Assessment Corporation, Ontario Premier Dalton McGuinty has told all official to follow the rules. And, as The Toronto Sun reports (September 9, 2009), “The auditor general is now going over OLG expenses and executives of the 23 largest agencies boards and commissions in the province will have to have their expenses approved in future by the integrity commissioner.”
Business World also Stiffens Oversight
“Most companies are putting a keener eye to expense control,” says Peter Brown, managing partner at Deloitte’s private company services in Canada. “People are thinking twice about what they’re putting on their expense report.”
Brown is quoted in an article by Dave McGinn in The Globe and Mail (September 7, 2009).
Most companies have strict guidelines on how much employees can expense for the cost of meals on the road and whether or not they can charge for a drink or two with dinner. Lavish and boozy lunches used to woo clients are likely to become rare events in the new age of frugality.
But, there are still going to be outrages coming to light to entertain and infuriate the citizenry such as those reported by HRWorld.com: “…One Stanford University ex-president expensed a set of $7,000 bed sheets, while Benjamin Ladner, former president of American University, expensed garbage bags for his residence, despite earning an annual salary of $633,000.”
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