Hamilton’s Office of the Auditor General (OAG) recently conducted an audit of city transfer payments and grants and found that “the city has been operating without a centralized governance structure and corporate policies.”
“Historically, transfer payment administration and management have been left to the individual program and service areas,” a press release states.
The audit was part of the Council-approved OAG General Work Plan 2023-2026.
Auditor General Charles Brown defines transfer payments as “transfers of money to individuals, external organizations or to other governments” for which the city “does not receive goods or services directly in return.”
The Auditor General used the city’s 2022 financial statements for the report since they were the most recent audited statements available.
In 2022, the City of Hamilton received over $500 million in incoming transfer payments from upper levels of government and paid out over $200 million in payments and grants.
However, the report says, “Effective governance and administration of transfer payment funds requires a governance model that provides leadership and strategic policy guidance for program and service areas that have responsibilities in administering transfer payments.”
We found that an effective governance structure for transfer payment administration does not exist at the City of Hamilton,” the report continues.
“Additionally, there is a lack of corporate-level strategic policy and planning to effectively oversee transfer payment and grant programs, ensuring transparency and accountability to the public.”
“There is also a distinct lack of policy to provide corporate direction to ensure prudent transfer payment management/administration.”
The Auditor General says that any grant program should be able to answer what outcomes the program intended to achieve, the current status with regard to the intended outcome, and whether the funds were used as intended.
He found that in the case of three City of Hamilton grant programs sampled as part of the audit, “these basic questions were unable to be answered unambiguously by the program areas responsible.”
He added that the city “has a responsibility to ensure grant programs are administered prudently and the value of the investment is realized.”
The Auditor General also found unclear and undefined roles and responsibilities in the administration of transfer payments and grants, oversight of service delivery, reporting on outcomes, and funding agreement/contract management.
As such, the Auditor General made six recommendations, which include establishing a governance and policy structure.
The Auditor General also recommended that the city publicly publish annual performance reporting of all transfer payments and the results achieved for Hamiltonians.
City staff agreed with all six recommendations and will now be working on an implementation plan, which will be shared with the Office of the Auditor General by Q4 2025.
Based in Hamilton, he reaches hundreds of thousands of people monthly on Facebook, Instagram, TikTok, and Twitter. He has been published in The Hamilton Spectator, Stoney Creek News, and Bay Observer. He has also been a segment host with Cable 14 Hamilton. In 2017, he received the Chancellor Full Tuition Scholarship from the University of Ottawa (BA, 2022). He has also received the Governor General’s Academic Medal. He formerly worked in a non-partisan role on Parliament Hill in Ottawa.
