The PEI Liberal Government’s Partisan Lending Program



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SUPPLEMENTARY INFORMATION ON PEI GOVERNMENT LOAN PROGRAM
Since publishing the above Guest Opinion, I have received a number of inquiries asking various questions about the PEI government lending program. Here is some additional information
Each year the government either “cancels”” or “writes-off” some bad loans for a clarification of the technical distinction see a Guest Opinion I published in the Guardian in 2015 titled, Lending Must Be Transparent] .
Over 18 million was written off in the 2016-17 fiscal year according to the Auditor General’s report released March 4, 2018. Her report only provides information on the amounts for the loans from each lending agency or department [See Here].
Changes to the Financial Administration Act in October 2016 now require the government to also disclose the names of the individuals or companies for which loans were either written-off or cancelled. When the Act was first amended in 2016, a news release from the Department of Finance disclosing the loans written off and/or cancelled for 25 entities as a one-off [See attached]….from then on, that information is only reported in Orders in Council on a case-by-case basis. My review of those Orders in Council confirm that only three loans were written off during the 2017-2018 fiscal year…here is the information on those
Cancellations of debt pursuant to subsection 26(1) of the Financial Administration Act
13-Jun-17
EC2017-327
Lender: Finance PEI
North Lake Fish Co-Operative Limited
Elmira, PE
$795,066.64
13-Jun-17
EC2017-328
Lender: PEI Century 2000 Fund Inc.
Maritime Pulse Drying
Montague, PE
$219,140.85
Write-off of debt pursuant to subsection 26.1(1) of the Financial Administration Act
24-Jan-17
EC2017-48
Lender: Finance PEI
One Debtor under $25,000*
Charlottetown, PE
$22,868.00
Note – Pursuant to sub-section 26.2(3)(d) of the Financial Administration Act, disclosure of the identity of borrowers, where debt does not exceed $25,000, is exempt.
What must also be realized is that it is possible that the government simply continues to carry “bad debts” on the books and never formally writes them off or cancels them.
As well, to my knowledge, there is no way to know if those receiving loans are in good standing with their payments, or to know what the particular terms and conditions of those loans were (e.g., interest rates, securities, etc.) but I stand to be corrected.
Disclosures under the Financial Administration Act made November 2016