The Auditor General of Québec issues the conclusions of her audit related to the motion of the National Assembly concerning financial assistance granted to Premier Tech - Press Release no. 2

QUÉBEC, June 2, 2016 /CNW Telbec/ - Today, Ms. Guylaine Leclerc makes public the results from her work at Investissement Québec (IQ) and at the Ministère de l'Économie, de la Science et de l'Innovation (MESI).

Government assistance was granted to Premier Tech through the Economic Development Fund (EDF). Certain EDF interventions are considered government mandates, because they do not align with any fund programs. To carry out a government mandate, it is required that Cabinet authorize the financial intervention by order. In 2012-2013, 12 projects, including that of Premier Tech, received financial assistance in this manner.

The request for financial assistance submitted by Premier Tech was treated like a government mandate, and it followed all the prescribed steps to that end. With regard to the grant, it was initially $7.5 million and was increased by $1 million to reach an agreement with the enterprise. It should be noted that we have not located any documents explaining the outcome of this agreement in the amount of $8.5 million.

The brief sent to Cabinet is based on government analyses that justify the relevance of supporting the project and financing it through an $11.2 million interest-free loan and an $8.5 million grant. However, two elements had an impact on the information supporting this brief.

First, no in-depth and documented analysis of the nature of Premier Tech's project expenditures was done by the MESI in conjunction with IQ. Such an analysis, which is not done systematically in this type of case, would have made it possible to assess the link between the nature of the submitted expenditures and the project activities and therefore better assess their relevance.

Second, the economic value of the project presented to Cabinet, which is one of the factors used for its decision making, was overstated. The analyses used to determine the economic value of the project contained inaccuracies. Contrary to what was presented in the brief to Cabinet, the project's economic value ratio was below the break-even point.

The financial agreements concluded between IQ and Premier Tech comply with the terms that the government established by order. An appropriate follow-up of clauses included in the agreements is carried out by IQ.

The Highlights are available at www.vgq.qc.ca. The full report is available only in French.

Source:

Lucie Roy, Director Cabinet, communications et affaires stratégiques Auditor General of Québec Tel.: [phone]

SOURCE Vérificateur Général du Québec

Lucie Roy, Director, Cabinet, communications et affaires stratégiques, Auditor General of Québec, Tel.: [phone]