Ontario auditor general Jim McCarter delivers his report at Queen’s Park, October 7, 2009.

Inevitably, the opposition parties at Queen’s Park are salivating over the auditor general’s special report on “Ontario’s Electronic Health Records Initiative,” released yesterday. And the report has already prompted the resignation of health minister David Caplan, and a slight cabinet shuffle.

Yet initial reactions from opposition politicians do little to suggest that they seriously understand the new elephant in the room. Casual passionate assertions that the problems raised by the auditor general’s report flow from the growth of  “a culture of entitlement under Dalton McGuinty’s watch” miss the mark.

The main thrust of the report is that “Ontario’s almost decade-long, $1-billion initiative to create an Electronic Health Record (EHR)” has been “lacking in strategic direction and relying too heavily on external consultants.” Auditor general Jim McCarter concludes that “Ontario taxpayers have not received value for money for this $1-billion investment.”

Various deeper truths will likely be turning up for a while yet. A few key parts of the background are worth stressing at the start.

The “Chronology of Events Relating to the Electronic Health Record Initiative” that McCarter appends to his report, for instance, starts as long ago as  1996. And the $1-billion spending spree for which Ontario taxpayers have not received value for money goes back almost a decade. The present McGuinty government was first elected on October 2, 2003 – only six years ago now.

Premier McGuinty answers questions on eHealth in Ontario legislature this past June. At that point he wouldn’t ask health minister David Caplan to resign, because “Caplan took all the right steps – including asking auditor general Jim McCarter to speed up his probe of eHealth – and shouldn't be blamed for the conduct of an agency which operates at arm's-length from the Ministry of Health.” Now the report has been released and everything has changed.

Some of the current trouble flows from eHealth Ontario’s quasi-independent organizational status. But the McCarter report has made clear that the Ministry of Health itself is ultimately responsible for what has happened. That is why the Minister of Health has finally resigned.

Similarly, the most populous province of Ontario is behind most other Canadian provinces in creating much-needed electronic health record systems, the McCarter report urges. But that is hardly surprising. The job in Ontario is just a lot bigger than in other provinces.

Moreover, the Ontario Ministry of Health spent more than $40 billion in the 2008—2009 fiscal year. Canada’s largest private-sector corporation, the Royal Bank, had revenues of less than $38 billion in 2008. The Ontario Ministry of Health is a very big and complex business. You have to get your mind around this primary fact, before you can start thinking clearly about the “eHealth and Information Management Program” (which will spend less than half a billion dollars this year).

To imagine, as some opposition politicians are urging, that it will do anyone any good to have Dalton McGuinty’s former Minister of Health George Smitherman resign – along with his successor David Caplan – is something out of Alice in Wonderland. What Premier McGuinty has said (and done) is no doubt not perfect. But it is at least more reassuring than that.