September 03, 2004

Effective today, the province will begin the process of transferring Hydra House funding and the responsibility for its residents to other service providers, Family Services and Housing Minister Christine Melnick has announced.

Melnick said the move is a part of ongoing efforts to increase transparency and accountability. Efforts are also underway to ensure the service delivery workforce is included in the process.

"The public trust has been irrevocably broken and this relationship cannot be allowed to continue," said Melnick. "As we move forward with the process, we intend to provide the smoothest transition possible, at all times considering what is best for the people who live in Hydra House facilities. The residents at Hydra House have significant and complex medical conditions and it is our top priority to ensure they continue to receive the specialized care and attention they need."

The minister noted the province had already accepted the findings of the auditor general who reviewed the finances of the privately owned corporation from 1997 to 2002 and found Hydra House did not use public funds as intended during that period. She said it is clear the department requires additional capacity to review financial allegations and it is now in the process of building that capacity by putting in place a five-member Agency Accountability Unit. A similar unit was effectively disbanded in the 1990s.

Melnick said, since the report was released, the government has been working to improve accountability and transparency and, most importantly, to deal with the financial accountability of Hydra House including:

• appointing an interim, third-party management organization on July 6 to monitor financial transactions at Hydra House and provide oversight on financial management matters;

• establishing a five-member agency accountability unit to work with agencies to achieve compliance with current reporting requirements;

• establishing an implementation team to develop an action plan for improved accountability and transparency for the use of public funds; and

• continuing government review of any and all ways to recover misused funds.

No new clients have been placed with Hydra House since the auditor general’s report.

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