Hansard Apr. 19, 05 QUESTION PERIOD: Government Contracts & Sponsorship Program

Hansard April 19, 2005 ORAL QUESTION PERIOD

Government Contracts

Hon. Stephen Harper (Leader of the Opposition, CPC): Mr. Speaker, yesterday's sworn testimony at the public accounts committee makes it clear that the Prime Minister funnelled tax dollars to Earnscliffe and his campaign manager David Herle. A top secret document dated 1995 says that at least $615,000 in improper contracts had already flowed. A memo outlines that the competition was flawed, the payment excessive, the work probably not needed.

As David Herle prepares yet another campaign of dirt and slander, should the taxpayers of Canada not know that it is money going from finance to Earnscliffe that gave birth to it all?

Hon. Anne McLellan (Deputy Prime Minister and Minister of Public Safety and Emergency Preparedness, Lib.): [. . . . ] Mr. Speaker, first, I hear all those hon. gentlemen and women across the way calling out, “Where is the Prime Minister?” Let me tell everyone where the Prime Minister is.

. . . .launch of this government's international policy statement which in fact speaks to the direction in which this government wants to take our country as it relates to our role in the rest of the world. The Prime Minister is now meeting with some of the globe's most important and influential ambassadors to ensure that they understand the role we want--

(1420)

The Speaker: The hon. Leader of the Opposition.

Hon. Stephen Harper (Leader of the Opposition, CPC): Mr. Speaker, there is not a person in Canada who does not understand that these announcements are about a government that has done nothing for 12 years and is now trying to run away from a rocky record of corruption.

Why does the government not just admit, as public servant Allan Cutler testified, that the Prime Minister abused the process to get contracts to his friends at Earnscliffe, to his campaign manager David Herle? Why does he not just admit that he got public money to his political associates?

Hon. Ralph Goodale (Minister of Finance, Lib.): Mr. Speaker, we have the views on this subject of the Auditor General of Canada. I would quote from her report in 2003:

Our review of a sample of standing offers found that the competitive process had been followed in pre-qualifying suppliers. Requests for proposals were issued, and the selection process resulted in standing offer agreements with the successful bidders.

We note that the vast majority of these suppliers were not the same as those providing sponsorship or advertising services.

[. . . . ]

Hon. Stephen Harper(Leader of the Opposition, CPC): Mr. Speaker, I fail to see how breaking the rules on ordinary contracting makes any difference that it was not sponsorship.

The Prime Minister said last week in the House, “I have never interfered in any contract”, yet Warren Kinsella testified under oath that the Prime Minister phoned him at home to push for a contract to Earnscliffe.

With the Prime Minister caught in the biggest scandal in history, in the web of his own deception, should he not be here to answer questions on the floor of the House?

Hon. Ralph Goodale (Minister of Finance, Lib.): Mr. Speaker, in reference to that testimony yesterday, I would note that in today's Toronto Star the former policy adviser to the Prime Minister, Eddie Goldenberg, completely denied a number of the allegations that were made by Mr. Kinsella.

I would also note that in reference to the credibility of Mr. Kinsella, this House has already been warned to be careful in that matter. There is a reference to the “poisoned partisans like Warren Kinsella”, and that advice comes from the deputy leader of the Conservative Party.

Hon. Stephen Harper (Leader of the Opposition, CPC): Mr. Speaker, I have a very simple question. When each group of Liberals calls the other group of Liberals a bunch of crooks and liars, does it really matter which one we
believe?

Hon. Ralph Goodale (Minister of Finance, Lib.): Mr. Speaker, in matters like this, yes indeed, the truth does matter a lot. I would refer the hon. gentleman to the Auditor General's report from the year 2003, or the external audit that was conducted by Ernst & Young in 1996. Let me quote that one. Ernst & Young said:

Our audit of the research contracting process determined that APORS was in compliance with prescribed policies and procedures.... We found no instances where non-compliance might have led to situations of personal gain or benefit.

The truth does matter.

Mr. Peter MacKay (Central Nova, CPC): Mr. Speaker, it is hard to audit envelopes of cash.

Yesterday at the public accounts committee it was revealed by a longtime Liberal strategist that there was concern within the Liberal government as far back as 1995 that government contracts were being used to cross-subsidize the Prime Minister's leadership campaign activity.

Under sworn testimony Warren Kinsella said, “I and perhaps others would consider it inappropriate that you cross-subsidize that political activity using the public treasury. That's inappropriate”.

Will the Prime Minister now admit that he was both informed and involved in an ad scam-like kickback scheme to use taxpayers' money to fund his leadership campaign?

[. . . . ]

(1425)

Hon. Ralph Goodale(Minister of Finance, Lib.): Mr. Speaker, the Prime Minister will make no such concession as the deputy leader of the Conservative Party has asked for. Today the member is relying heavily upon the views and the comments of Mr. Kinsella. I would simply ask him why then, not very long ago, did he call that individual “a poisoned partisan”?

[Translation]

Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker, in November 1994, Warren Kinsella wrote Terrie O'Leary about a contract awarded Earnscliffe, and I quote:

Terrie, all of this spells trouble and you know it. The competition was flawed, the payment is excessive, the work is probably not needed, and the research community can be fully expected to blow the whistle on the political connections here.

Given this statement, will the Prime Minister finally recognize that his entourage intervened to get the contract awarded to Earnscliffe, the firm employing key players in his leadership campaign?

[English]

Hon. Ralph Goodale (Minister of Finance, Lib.): Mr. Speaker, the very period referred to by the hon. gentleman was subject to an independent external audit conducted by Ernst & Young which covered the period from 1994-96. It was reported in 1997 and it says:

Our audit of the research contracting process determined that [the agency at the Department of Public Works] was in compliance with prescribed policies and procedures.... We found no instances where non-compliance might have led to situations of personal gain or benefit.

That is the independent audit.

[Translation]

Mr. Gilles Duceppe (Laurier—Sainte-Marie, BQ): Mr. Speaker, Warren Kinsella was testifying under oath, with evidence. Not only must there be no conflict of interest, there must appear to be no conflict of interest. So we have the executive assistant of the former finance minister, now Prime Minister, who happens to be the wife of someone working at Earnscliffe, and the contract is awarded to Earnscliffe.

Is this not a conflict of interest? I would like to see what sort of birthday card he sends to the spouse and to the woman who was his assistant?


[. . . . ] [Translation]

Mr. Benoît Sauvageau (Repentigny, BQ): Mr. Speaker, the Prime Minister was aware of the interventions made to ensure Earnscliffe got the contracts for the Department of Finance, because he intervened himself to add pressure.

What does the Prime Minister have to say about Mr. Kinsella's statement under oath that the former finance minister had even called him at home to complain?

[English]

Hon. Ralph Goodale (Minister of Finance, Lib.): Mr. Speaker, there is absolutely no evidence of such a mythical phone call.

[. . . . ] The documentation is the same, and indeed it supports the case that the staff of the former minister of finance was arguing for more contracting competition, not less.

[Translation]

Mr. Benoît Sauvageau (Repentigny, BQ): Mr. Speaker, indeed, the documents submitted in evidence to the Standing Committee on Public Accounts show beyond any doubt that the finance department intervened at least four times—and this has been confirmed—to promote Ekos, Earnscliffe and Everest.

[. . . . ] (1430)

[. . . . ]

Sponsorship Program

Mr. James Moore (Port Moody—Westwood—Port Coquitlam, CPC): Mr. Speaker, Claude Boulay, who worked on the Prime Minister's leadership campaign, to whom the Prime Minister writes very glowing and very personal letters, received $67 million in sponsorship cash when the Prime Minister was the finance minister.

The Prime Minister's campaigns and the Liberal Party were financed by Boulay and Boulay was financed by dirty money from the sponsorship inquiry.

Why will the Prime Minister not tell the whole truth about his relationship with Claude Boulay? Is it a guilty conscience?

Hon. Anne McLellan (Deputy Prime Minister and Minister of Public Safety and Emergency Preparedness, Lib.): Mr. Speaker, the Prime Minister has been absolutely clear and completely truthful about his relationship with Claude Boulay. He has said over and over again in this House and I have said that the Prime Minister never lunched with Claude Boulay in relation to the direction of any contract to anyone.

[. . . . ]
[Translation]

Mr. James Moore (Port Moody—Westwood—Port Coquitlam, CPC): Mr. Speaker, on April 14, the Prime Minister denied having dined with Claude Boulay, but Alain Renaud has stated that the Prime Minister did dine with him. Now we learn that, when the PM was finance minister, Mr. Boulay received over $67 million in sponsorships.

[. . . . ]
[Translation]

Mr. Michel Gauthier (Roberval—Lac-Saint-Jean, BQ): Mr. Speaker, in an internal PWGSC memo dated July 24, 1995, we learn that nearly $298,000 in contracts was awarded by dubious means to Earnscliffe, a firm with close ties to the Prime Minister, in 1994 and 1995, by the finance department.

Why is the Prime Minister trying to make us believe that he knew nothing, when his department did this for Earnscliffe, which had close ties with him, was involved in his leadership campaign and was headed by the husband of his chief of staff? Those are a lot of coincidences for one man.

[. . . . ]

[Translation]

Mr. Michel Guimond (Montmorency—Charlevoix—Haute-Côte-Nord, BQ): Mr. Speaker, Alfonso Gagliano said that the current Minister of Transport had approached him to put in a good word for his friend François Dufort of Cossette, a company trying to land federal contracts.

Does the Minister of Transport recognize that what he did for Cossette, despite what he says, was nothing short of lobbying?

Hon. Scott Brison (Minister of Public Works and Government Services, Lib.): Mr. Speaker, that is not true, but we know that Groupaction employees gave $100,000 to the Parti Québécois and that Groupaction won contracts from the Société des alcools du Québec and Télé-Québec.

That is quite something for a party that claims to be clean.

Mr. Michel Guimond (Montmorency—Charlevoix—Haute-Côte-Nord, BQ): Mr. Speaker, we were talking about Cossette. The Minister of Transport would have us believe that he invoiced only for policy analysis or brainstorming, but not for time spent arranging meetings with ministers for his friends, and their subsequent meals.

Does the Minister of Transport think we believe that? No one believes the Minister of Transport.

[. . . . ]
[English]

Mr. Jeff Watson (Essex, CPC): Mr. Speaker, the Prime Minister testified that he barely knew Groupe Everest president, Claude Boulay, and his wife. Yet the Prime Minister's letters entered into evidence show this relationship was in fact warm and quite personal.

Here is what he said about Boulay's wife, the queen of Liberal ticket sellers, “I still believe that the years wash over Diane with such grace and beauty that she remains youthful”, a statement so fresh to an acquaintance it deserves a slap.

Will the Prime Minister finally admit that his Gomery testimony was not the full truth?

[. . . . ]

Mr. Jeff Watson (Essex, CPC): Mr. Speaker, if the Prime Minister wrote a letter like that to my wife, I would have him outside this House real quick.

According to the Prime Minister's Office, the Prime Minister sent out 53,000 greetings last year. I have a very simple question. I would like to know how many he sent out when he was finance minister and how many of those greetings referred to wine, golf games and hot wives?

[. . . . ]
(1445)
[. . . . ]

Mr. Jason Kenney (Calgary Southeast, CPC): Mr. Speaker, well before his intimate letters of—

[laughter, Speaker. . . . ] [Translation]

Mr. Jason Kenney: Quite right, Mr. Speaker. Well before he sent his intimate letter to Claude Boulay in 2001, the Prime Minister sent another “Dear Claude” letter in 1994, in which he stated “The services you provide could be of interest to the federal office of regional development for Quebec, of which I am the minister responsible. Your letter has been forwarded to my office in Montreal—”

Is this not proof that the Prime Minister intervened in order to make sure his buddy Claude Boulay got some of the dirty money?

[English]

Hon. Scott Brison (Minister of Public Works and Government Services, Lib.): Mr. Speaker, the simple answer to the hon. member's question is no.

Part of the testimony that we have heard, as indicated by Mr. Boulay, was that he has done business with the Government of Canada going back to 1984. That was not a Liberal government; that was a Conservative government.

[. . . . ]

Mr. Jason Kenney (Calgary Southeast, CPC): Yes, Mr. Speaker, and he has known the Prime Minister for some 20 years. Why is it then that the Prime Minister said it was a short term relationship? Why is it the Prime Minister said that he barely knew him when the Prime Minister was recommending him for business 11 years ago, when he was commenting on the good looks of his
wife four years ago and when he was working on the Prime Minister's leadership 15 years ago?

Why did the Prime Minister not tell the whole truth under oath to Canadians?

Hon. Scott Brison (Minister of Public Works and Government Services, Lib.): Mr. Speaker, the Prime Minister of Canada always tells the truth and he did tell the truth under oath.

[. . . . ] Canadians know that they can believe our Prime Minister. [. . . . ]