:
We will officially call the meeting to order.
Welcome to meeting 45 of the House of Commons Standing Committee on Finance. We are meeting on government spending, WE Charity and the Canada student service grant. Today's meeting is taking place by video conference. The proceedings will be made available via the House of Commons website.
For the information of members—the notice just came out now—on the first panel we will have, as an individual, between 12 p.m. and 1 p.m. Ottawa time, Michelle Douglas, former chair of the board of directors of WE Charity. Craig Kielburger and Marc Kielburger have agreed to come for four hours, from 1 p.m. until 5 p.m. Ottawa time. They will appear on the second panel.
I'd like to welcome our first witness. Michelle Douglas is a former chair of the board of directors.
Welcome to the committee. We appreciate your appearing. If you could hold your remarks to 10 minutes or less, it would be helpful and would give us more time for questions.
The floor is yours.
:
Thank you very much, Chair. Good afternoon, everyone. I'd like to thank you, Chair and members of the committee, for the invitation to appear today.
My name is Michelle Douglas. I'm the former chair of the board of directors of WE Charity. I resigned from WE Charity on March 27, 2020. I was a volunteer with WE Charity for approximately 15 years. For 30 years, I worked as a federal public servant. I retired from the Department of Justice in September 2019 from the role of director of international relations. I'm also a military veteran and I have been a human rights activist for most of my adult life.
My human rights activism emerged as a result of my experience in the Canadian military in the late 1980s. I was fired by the military in 1989. I was a victim of Canada's shameful LGBT purge and endured quite a devastating experience being subjected to horrendous practices designed to rid the military of LGBT people.
My 1992 lawsuit resulted in the formal ending of Canada's armed forces' policy of discrimination against LGBT people. This life-changing experience launched me into a life of human rights activism as a volunteer. I have volunteered on several boards of directors over the past few decades, and volunteerism in service to others is one of the central pillars in my life.
Currently I'm the executive director of a not-for-profit organization that is focused on reconciliation initiatives associated with the LGBT purge. I joined the board of directors of Free The Children in approximately 2005 following a meeting with Marc Kielburger. I'd been inspired by his brother Craig's work as a young teen and I was excited by the prospect of working with an organization that would inspire young people to contribute to a more just, hopeful and loving world.
I was an enthusiastic supporter of Free The Children and later WE Charity. The board that I chaired consisted of dedicated, skilled and committed volunteers. Board members included academics, educators, human rights activists, business people, a chartered accountant, a lawyer and others. In addition to attending board meetings, board members committed a tremendous amount of time to the organization. This took various forms, from regular meetings with the executive team to travelling to see the charity's international operations, to spending time with WE's employees, to attending events such as WE Days.
Given my passion for the organization, it was a difficult decision for me to tender my resignation. I did not resign as a routine matter or as part of a planned board transition. I resigned because I could not do my job. I could not discharge my governance duties.
In March, the WE Charity executive team were scrambling to contend with the impacts of the pandemic, and they began to lay off large numbers of staff. As the days went by, the number of job losses grew quickly, into the hundreds. The board felt, of course, a duty to protect the organization and to consider the interests of its stakeholders, including its employees, donors, partners, beneficiaries and others. I convened an ad hoc committee of the board to hold daily calls with the executive team for briefings and updates, and we provided key updates, in turn, to the board at large.
The committee made requests of the WE Charity executive team that we considered necessary for the board to discharge its oversight duties. By March 23, aside from verbal briefings, we had not seen any written evidence, reports or raw data to support the drastic measures that were being taken by the organization. Our oral briefings were focused largely on things like the status of support from sponsors. We were told that the executive team was running daily financial reports to inform their decision-making, but those reports were not shared with the board despite our requests.
It was our view that we could not fire hundreds of people without very strong demonstrable evidence and, even then, that we should explore mitigation measures to save jobs. Instead, the executive team were dismissing employees with great speed and in large numbers.
Given the pace and volume of job losses, the board committee demanded that the executive team produce immediately the documents and reports that were said to be being generated and relied upon on a daily basis. If the organization was making drastic decisions based on daily reports, we needed to see them. The executive team, when asked, did not agree to provide these documents.
On March 25 Craig Kielburger called me to ask that I resign from the board of directors of WE Charity. It was clear that there was a breakdown in trust between the founders and me as the board chair. WE is a founder-led organization, and Marc and Craig Kielburger hold significant power in the organization. As I was not going to be able to discharge my oversight duties, I opted to resign immediately. In an accelerated process, the remainder of the board of directors was replaced—but for one Canadian member and two U.S. board members—in early April. I was not on the board at that time, and therefore cannot speak to the circumstances of their replacement.
Given the nature of these proceedings, I'd like to add the following. Having resigned on March 27, 2020, I have no knowledge whatsoever of the Canada student service grant program. I was involved in some discussions in 2018 with the board of directors that concerned an entity called the WE Charity Foundation. While the entity was established in January 2018, the board was never satisfied that the operation of this foundation was in the best interests of the charity or its various stakeholders. To the best of my knowledge, it was not in operation as of my departure from the board.
The WE Charity board always understood that speakers were not paid by the charity or the related organization to speak at WE Days. The board made direct inquiries on this issue.
As I wrap up my remarks, I want to conclude on two points. My family has been deeply involved in the WE organization for many years. We have fundraised and volunteered. My sister and nephew once worked for the organization. My family values serving others, and WE allowed us to express that value over many years. I know that all of us are saddened by the developments that have led us here today.
Finally, I'd like to affirm my belief in the very good work done by WE Charity. I've always believed in the organization's empowerment of young people to change our world. I've always believed in WE Charity's international development work and life-changing impacts. I've always been grateful for the incredible commitment of the organization's supporters and volunteers. Finally, I've always been inspired by the amazing and selfless professionals, the employees, who work so hard to implement the mission of WE. Those people have my respect and deep thanks.
That concludes my remarks, Chair. Thank you.
:
Thank you so much, Mr. Chair.
Thank you, Madam Douglas. Thank you for your public service. It's really important.
My daughters went to Free the Children when they were, probably, in grades 4, 5 and 6. It changed their lives. My oldest said it set her on a course for human rights activism.
But that's a very, very different group, when they were all young and idealistic, to what we have today, which I find very hard to get my head around—the multiple corporations, the mass real estate dealings, the various what's for profit, what's for public. Therefore, governance is a really, really important question. Governance is super important when we're talking about a deal with the federal government that may be close to a billion dollars. We need governance and oversight.
I'm very concerned about the situation that was happening with your board in March. You said you were trying to get answers; there were mass layoffs taking place. Would you say, in the conversation with Marc Kielburger by teleconference, that he was not forthcoming, that he was getting angry?
We'll call the meeting to order. All the technicalities are out of the way.
We are meeting on government spending, WE Charity and the Canada student service grant. Just for everyone's information, the meeting is taking place by video conference, and proceedings will be made available via the House of Commons website.
We'll now start our second panel of today.
I'd like to welcome Craig and Marc Kielburger, the founders of the WE Charity.
Thank you both for agreeing to take the four hours.
For the information of committee members, because a four-hour meeting is somewhat unusual, the Kielburgers had initially asked for 20 minutes during the two-hour session. We responded that the maximum we'd allow them was 10 minutes, but now that we're doing four hours, I've decided that it's quite fine to do the 20 minutes, which still give us lots of time for questioning.
With that, we are ready to start, with the exception that, I believe, you wanted to be sworn in, and so I'll turn that over to the clerk.
Good afternoon.
My name is Craig Kielburger and this is my brother Marc.
First, thank you, Mr. Chair. We will remain within the 10 minutes, in fact. We are grateful to the rest of the committee. We've been looking forward to this opportunity to speak with you here today.
[Translation]
Over the past few weeks, our team has responded to thousands of questions from the media. We have posted dozens of documents online, including an annotated version of the Canada student service grant contribution agreement and information on WE Charity's programs, operations and finances.
Along the way, we have announced that additional experts will analyze our systems to streamline our organizational structure, further improve our governance and focus our efforts to help the most vulnerable children around the globe.
I just want to raise it, at this point, to the degree that my point of order could impact upon...or should either of the witnesses wish to rephrase or reframe any aspect of their presentation.
Given the large number of organizations the Kielburger family is affiliated with or otherwise connected with, from now until the end of this meeting, when Conservative members make reference to WE or your organization, unless otherwise stated, we are referencing, in the broadest way possible, any corporation, company, partnership, organization, association, entity or upper structure, including, but not limited to, WE Charity, WE Charity Foundation, ME to WE, ME to WE Social Enterprise, ME to WE Foundation—
Twenty-five years ago, we started WE Charity as teenagers because we believed young people have much to offer through service. We still hold this belief.
There is a crisis in Canada's charitable sector. Over the past 30 years, Canada has seen steadily declining rates of civic engagement and reached a record-low percentage of Canadians donating to charity.
WE Charity sought to reverse this trend by launching WE Schools, active in 7,000 Canadian schools, to educate and inspire young people to learn about causes, volunteer for the first time in their lives and fundraise to make an impact for thousands of charities across the country.
Through WE Day, over one million youth earned their free ticket through logging over 70 million hours of service. Youth joined us to build 1,500 schools and classrooms in developing countries around the world, educating over 200,000 kids in clean water and medical programs, reaching over a million beneficiaries.
We launched ME to WE Social Enterprise because traditional models of charity are too limited in Canada. Its purpose is to help end poverty overseas. We create empowering jobs and bring to market fair trade and socially conscious products, helping mostly women entrepreneurs. Although its purpose was never simply profit, since its founding in 2008, 100% of profits from ME to WE Social Enterprise have been donated to WE Charity or reinvested to grow the social mission: every single penny.
This model is called a social enterprise. It's common in Europe, but in Canada the Canada Revenue Agency limits a charity's ability to operate a business model as a solution to solving social problems. In 2019 the Senate of Canada released a report that recommended that the government recognize and reconsider those restrictions for charitable and non-profit organizations. We strongly support that recommendation. With such a change, we would have simply started ME to WE Social Enterprise as a charity.
We acknowledge that over 25 years, our organizational structure has grown overly complex. Our model is different, sometimes misunderstood and, yes, far from perfect, but our purpose has always been social innovation to better Canada and the world.
WE Charity is a non-partisan organization. We have worked with federal and provincial governments of every party across Canada. We have welcomed politicians of all stripes to the WE Day stage, including Conservative MP Mike Lake and then NDP premier Rachel Notley. We're grateful to the previous government that Laureen Harper hosted the WE Day after-reception at 24 Sussex.
Over the years, thousands of stories have been shared on the WE Day stage. We invite individuals to speak who can inspire youth to volunteer and serve, which is what our mission is all about.
WE Charity agreed to implement the Canada student service grant not to be helped by government but to help government and to help young people across Canada. This program was developed in the midst of a global pandemic, when governments and the private sector were scrambling. Some have suggested that WE Charity was in dire financial straits prior to the CSSG, and that it somehow motivated our actions. It simply isn't true, because, like many Canadian non-profits and businesses, we had already taken difficult actions to adjust staff members and to pivot our programs to the new realities of COVID, as you heard a moment ago.
My comments about that time are not false bravado. As we see the organization today, I acknowledge that the fallout now from this political process has resulted in serious challenges that risk the entire organization and our 25 years of work.
As you heard in previous remarks to this committee from Rachel Wernick and the Clerk of the Privy Council, we were not chosen for this work by public servants because of our relationship with politicians. We were chosen because we were willing to leverage every part of our 25 years of experience and to build this program at the breakneck speed required to have an impact for Canadian youth over the summer.
WE Charity had experience in this area. We had previously built two large-scale youth service programs. When Ontario introduced the mandatory 40 hours of community service, we developed a program for many school boards across the province. The College Board, which is the largest U.S. association of colleges and universities, selected WE Charity three years ago to develop a national U.S. service program across all 50 states.
I'll turn now to the contribution agreement itself. As per the contribution agreement, WE Charity would only be reimbursed for its costs to build and administer the program. To be clear, there was no financial benefit for the charity. WE Charity would not have received any financial gain from the CSSG program, and it's simply incorrect to say otherwise. The contribution agreement had proper oversight built in, with some 13 references to audits, and taxpayers were protected. Our team worked incredibly hard to build and launch the CSSG as a national bilingual service program. The results were evident within the first week, with 35,000 youth applications from every province and territory, 83 non-for-profit coalition partners, and 24,000 and increasing service roles.
But the program quickly got pulled into politics. We handed the built system, technology, even the call centre, to the public service, hoping to save the program. We declined any reimbursement for our costs. We thought our actions would enable the program's long-term survival, and we are deeply saddened that it did not. We also regret that the fallout has created hardship for our staff, our partners and the communities we serve.
When Employment and Social Development Canada asked us to administer the Canada student service grant, we regret that we didn't recognize how this decision would be perceived. We would never have picked up the phone when the civil service called, asking us to help young Canadians get through the pandemic, if we had known the consequences: that young people would not get the help they need now and that 25 years of WE Charity's programs helping millions of youth would be in jeopardy.
We are most sorry for the students of Canada. We know that this pandemic has put so many in dire straits, unsure of whether they will be able to continue their education or even pay their rent. This committee heard yesterday about MPs' offices being flooded with emails and calls from students desperate for help. These students should be volunteering, serving their country and receiving critical support for their education.
We respect this process and we are happy to participate. We hope the people of Canada will have their questions answered about how the contract came about and what the value of money would have been. We also hope that as soon as it concludes, all of us—non-profits, governments and all Canadians—can get back to helping the students of Canada get the support they need to get through this time of national crisis.
Mr. Chair, thank you for the opportunity to share those words. We appreciate that. We are ready for your questions.
:
Thank you so much, Mr. Chair.
Thank you to our two presenters today. Thank you for your presentation. Thank you for making yourselves available for four hours; it's highly unusual, so thank you for that.
I also want to say thank you for the tremendous positive impact that WE Charity has had on engaging youth not only across our country but around the world, and for all the amazing work WE Charity has done to reduce poverty. Thanks for all of that.
A lot of misinformation and false narratives are being floated around. I'm going to try to get to some facts, because I think Canadians who are listening need to get to those facts.
First, we're hearing a lot about a “billion-dollar” contract. It gives the impression that WE was getting a billion dollars and that this was the agreement with the government.
Indeed, can you confirm that it was actually about a $543-million contract contribution agreement with the government to deliver the Canada student service grant, with up to $43.5 million going to WE and up to $500 million going to students? Can you confirm that?
:
Yes, we can confirm that.
I would like to provide a little bit of context, because it's an incredibly helpful piece of context that has been unfortunately misshared.
Number one, the first time we heard about the $912 million was when it was announced. We had never been privy to that information before.
Second, the contract was “up to”, as you very correctly said, $543 million.
Number three, the “up to” is relevant both to the young people who would be participating and in terms of their volunteer service hours, and also relevant to the organization. This was a contribution agreement based on eligible expenses for eligible expenditures. The organization did not stand to financially benefit from this. It was basically an amount of money we received. Anything we received we'd have to use for the program or otherwise return to the government.
The other misconception here is that it really was “up to” the $500 million for young people to do service. Based on our modelling, the average young person may have done 100 hours, 200 hours; maximum 300 hours of service. Very few would have received the 500 hours of $5,000, so the true cost of this program would likely have been in the range of $200 million to $300 million.
:
I appreciate your asking that question. If I can start by clarifying, in fact it actually wasn't an administration fee; it was a program implementation fee. What I mean by that is.... Often in the charitable world, when people think of admin, they think back office or fundraising. The costs here were simply directly for reimbursements on the delivery of the program.
So to answer your question precisely, for the first 20,000 students, WE Charity has provided $14.5 million for all-inclusive aspects. It could have gone up to $34.78 million. What was included in those aspects? It was, for example, technology grants for students who needed access in rural areas, translation of resources for special needs students, coaching and support, the direct supervision of up to 20,000 students to support non-profits that couldn't otherwise mentor and support those students, working with non-profits to help translate their ideas to be COVID-safe and friendly, launching the web support, call centre support, insurance support, payment, T4 form follow-up six months later.
In short, this was a massive program launched during a pandemic to support up to 100,000 young people with a very high-tech program, because the emphasis was on students of greatest need. We were to target particularly indigenous and students in rural parts of Canada.
:
I appreciate the question, sir. Thank you.
Fundamentally, there are two overarching structures: WE Charity and ME to WE Social Enterprises. As I mentioned in my opening remarks, as per CRA and the Income Tax Act, section 149 to be precise, charities cannot operate like businesses to solve social issues. They cannot literally operate a business structure. It's because of this unfortunate reality of the CRA structure in Canada that things like Grameen Bank, an extraordinary social enterprise that won the Nobel Peace Prize for microcredit, lifting people out of poverty, frankly, never could have been created in Canada. Social enterprise is a growing and powerful force to better the world.
So WE had to engage the best lawyers and accountants and systems to build what was a labyrinth to adhere to the proper Canadian laws and regulations, and it's a shame because we get called by so many people who are seeking how they can do it themselves in this way. So these fundamental structures exist to fulfill the social mission mandate. Each country you listed adheres to its respective country laws. Canada's has its own incorporation, the U.S., the U.K. In fact, other countries in the developing world have their own incorporation. Fundamentally, it is WE Charity and WE to ME Social Enterprises.
:
Thank you very much, Mr. Chair.
I'm very much enjoying the back and forth in the testimony, though I sometimes have trouble hearing the answers over the questions.
First, one of the responses you gave—initially to my colleague Ms. Dzerowicz, and then to Mr. Fragiskatos—I found stunning. I want to make sure I have my understanding correct.
Of the $500-or-so million program, there is an “up to” $43-million administration fee, depending on how many students can be placed. I was under the impression that this was going to provide some sort of benefit to the organization for administering this program.
Am I correct in my understanding that every penny of that administration fee, if the program were actually executed properly, would not have gone to the organization but would have been exclusively for expenses?
:
Thank you, Mr. Chair. I really appreciate this.
To correct the record, I've known both Marc and Craig Kielburger for years. I don't say this because I'm angry with you over it, but I do need to correct that you've never asked the Green Party to anything. You've never asked me to be a speaker. At this point I don't know whether I really want to thank you for that, but....
Voices: Oh, oh!
Ms. Elizabeth May: I do want to get to a serious question, though. I was very impressed, of course, with Michelle Douglas. I know her as well. I'm a huge fan of hers. I do get concerned with board governance issues. In the future I think you may want to look at your role as founders, which I think Mr. Barrett raised earlier. When you look on the website, you have founders, staff, the board of directors. It's a bit murky as a governance question.
Ms. Douglas told us she gave three reasons for her resignation. One of them was that she couldn't get answers from you, Marc, as to why you went to Kenya twice in a period of time when the organization was in considerable difficulties.
Can you explain it to the committee? Only because she thinks it's highly significant, I need to ask you, why did you go to Kenya twice and why didn't you give her the information as to why you went?
:
Of course, Ms. May, thank you. Out of all of this, we appreciate your kind compliments at the beginning as well.
Very quickly, of course going back three months ago, the world was topsy-turvy. I had a prescheduled trip to go to Kenya to help work with the organization. Then a handful of days later, when the pandemic really started to begin in earnest very significantly, we saw governments closing borders and shutting things down.
We literally had dozens of young people on international volunteer trips overseas. We had Canadian and American staff who were literally stuck, who could have been stuck overseas. Some ended up being in a very difficult position. We had to get them out.
As a leader of the organization, I said I needed to continue to give assistance. Even though I'd just come back, the situation began to rapidly unfold. I was only back in Kenya for 24 more hours, at the request of the team, to be of assistance where possible and to help ensure that the organization would be fine, but most importantly that our people would be fine. I was doing my very best.
I may not have articulated that under the circumstances, a very stressful time, but I was there for our people.
:
Yes, sir. I'm happy to speak to that.
On April 7 there was a conversation with . It was a first-time, introductory phone call. It was the first time ever I spoke to her.
On April 9, as per that conversation, I sent her a proposal that we had previously created on youth entrepreneurship. That proposal was also forwarded to , given that she has the portfolio for youth, and Minister Morneau, given that he is the and our local MP.
I was in touch also, sir, with in a phone conversation that took place.... I will get you that date, but it was sometime in the middle of April. It was to brief her on the conversation we had with on social entrepreneurship, not the CSSG, to be clear.
There was one conversation that also took place in April, a phone call from , on the Sunday, the 25th or 26th. He called me asking a question about.... He said he was doing a series of phone calls checking in with businesses and non-profits on the impact.... And that call took place.... I will happily put this into writing for you, sir.
:
Absolutely. To be very candid, we're grateful for their support.
Brian Pallister, a deep supporter of ours in Manitoba, its leader, frequently cheered on young people. We appreciate that Nazanin, Peter MacKay's spouse, has gotten on the stage on some empowerment things with us. We appreciate that, truly. Probably one of the best speeches I ever heard was actually from with his son on autism, as a member of Parliament raising awareness on this incredible issue.
If I may, I would also add the NDP. Rachel Notley, when she was premier, brought a call to action. Wab Kinew, the leader of the NDP in Manitoba, made multiple appearances talking about indigenous issues.
Every time we hold WE Day in a region, the local mayors and the local premiers would be invited to come out, and the local education ministers. Yes, the Prime Minister was invited. As the Prime Minister, he was invited. We also invite the Governor General. We also invite other individuals to join us at these celebrations.
:
Okay. I'll answer it this way.
WE Charity made absolutely no money, and could never have made any money in any way on this, with the contribution agreement. This was the ask from the government. We did not submit a proactive proposal. Rachel Wernick asked us, and we fulfilled the request that came in. The WE Charity Foundation was to solve a need the government asked us to solve. We were not in financial dire straits, because we made difficult choices.
ME to WE Social Enterprises has been incredibly misrepresented in this process. It exists solely to support the charity with 100% of its profits, every penny going to the charity. The main reason it exists is creating jobs for at-risk women around the world.
The real estate, surprisingly, has exploded as an issue. We use real estate like a science centre or a school. We host young people. We have our own global learning centre. We were retrofitting a series of buildings to create a shared space for youth to launch their own social enterprises and their own youth-led charities. Somehow that's being attacked in the press now, when a few months ago it was being praised.
The list continues, but fundamentally I would say this: We did this to be of service to the government, not for the government to help us. It is incredibly unfortunate, the fallout that has occurred.
:
We will reconvene. I'll recall the meeting to order, and hopefully Marc and Craig will appear there shortly.
While we're waiting for them, I'll just give people an update: Mr. McLeod will be up first for five minutes, then Mr. Fortin for two and a half, Mr. Julian for two and a half, Mr. Poilievre for five, Mr. Sorbara for five.
Do you have a way of contacting the Kielburgers there? Maybe they took my time, 4:01. Oh, there they are.
Good, gentlemen. Just to give you a heads-up, the interpreters are still having a little difficulty with your mike, especially for Craig, so maybe keep it a little closer, if you could. It's coming through a little soft.
Mr. McLeod, you're in an earlier part of the country. You and Mr. Julian are in a different, earlier time zone. We'll go with you for five minutes.
I want to say thank you to the presenters. Four hours is a long time to be sitting and answering questions, and we appreciate your coming forward. We're hearing a lot of information, so I appreciate that.
As an MP, I represent the Northwest Territories, and I have to admit that we have a limited presence in the north with WE Charity. It's certainly a complex organization, and it has become very apparent that it's supported by all parties, and all parties have people who have participated with WE. There's been a lot of media attention on your organization paying for high-profile individuals to travel on WE trips to other countries, such as in Africa, to see the impact of WE's global projects.
You said in a statement a few days ago that WE has invited several people—ambassadors and other people—to participate in these trips, and this is something that many international charities and humanitarian agencies do. They operate in a similar manner.
Could you tell us if WE Charity has taken Conservative or other parties, whether it be Conservative or NDP politicians, in the past to go on some of these trips? That's my first question.
:
Absolutely, sir, and thank you for raising that.
Our global work has been well documented: 1,500 schools and classrooms around the world, clean water, medical for about a million people that we've been able to establish around the world.
Not as well known sometimes is our domestic work. I think that's sometimes misunderstood. For example, Sacred Circle is a program that we've now run for over a decade. It was actually Shawn Atleo who was the person who helped us to frame it. It's a leadership training program for indigenous youth, most often in fly-in communities in Canada, to help young people be social entrepreneurs, to identify a problem in their own communities and then to be the heroes of their problem and help to solve that issue.
Likewise, WE Stand Together, sir, which you identified, is an educational program run in Canadian schools to teach non-indigenous students to better understand the past, present and future of indigenous students in Canada. In fact, part of what we have been doing in Canada has been trying to build these various systems to help young entrepreneurs in Canada.
It's something that has been, unfortunately, misunderstood. In Toronto, we've established a series of buildings to retrofit to create free space to welcome young entrepreneurs to set up their own charities with their own social enterprises. Unfortunately, because of COVID-19, it's on pause. These are the types of innovative projects that, in Canada, we try to do to serve youth.
You're right, sir, that our operation is complex, because, in our hearts, we're entrepreneurs. We create new systems. We want to build to create.
:
Thank you for asking, sir.
So, we actually.... Again, allow me to reiterate this very important point.
We believe that, in speaking on the WE Day stage, it is an honour and a privilege to address 10,000 or 20,000 young people at a time to share your story. It's typically two, three, four or five minutes max on the stage, and it's not a hard thing to get people who want to speak in front of 20,000. The challenge or difficulty is having someone come into a city to do multiple educator events, multiple breakfasts, fundraisers, cocktail parties, evening events and gala events.
Just like other charities, we engage through a speaking bureau with the proper processes in place, someone to help us find the talent to engage in those types of activities. We don't do telemarketing. We don't do street canvassing. We don't do mass mailing. We don't do fundraising of that nature, but bringing in these type of educational speakers to events allows us to bring partners and sponsors to the table. This is part of our model, and it works really well.
To clarify, again, this is not just to get up on the stage on WE Day, as per Ms. Douglas's comments. This is for a different purpose; it supports the organization's mission.
:
I am sorry, Mr. Chair. From now on I will be on the French channel.
Mr. Kielburger, you hired Margaret Sinclair Trudeau because she is former Prime Minister Pierre Elliot Trudeau's ex-wife and Prime Minister Justin Trudeau's mother. You hired the current Prime Minister's brother, Alexandre Trudeau, and the Prime Minister's wife, Sophie Grégoire Trudeau, all for speaking engagements.
and his wife went on vacation with you. Their daughters work for you. There are all these connections. As a matter of fact, you yourself said earlier that, while delivering a speech, you mistakenly mentioned that you had spoken with the Prime Minister's Office.
I sense that you have a very close relationship with the Trudeau family and the Morneau family. Do you acknowledge that you have very close ties with the Trudeau family and the Morneau family?
:
Yes. Allow us to answer your question, sir.
First, and I say this with great respect, Margaret Trudeau is more than someone's mother. Sophie Grégoire Trudeau is more than someone's wife. We live and we engage with individuals on the merit that they also bring themselves, as individuals, to these important causes. I feel that I need to correct the record on that, sir.
To the heart of your question, why we didn't register, it's because, based on our understanding of the time definition involved, in the vast majority of these cases—what we're describing, in fact everything until last month, or two months ago I should say—this was a minimal amount of time to fill out a government application for a grant. We recognize that when we were approached by ESDC in the month of April the amount of time increased. Frankly, we're working with our team to determine whether that should have triggered us to register.
We're happy to look into that question, sir, for the month of April, when the government proactively approached us. Honestly, sir, we didn't think at that point that something was necessary, because they were calling us to be helpful to them. We're looking into the matter. We're happy to look further into the matter.
:
I am raising a point of order for the following reason.
I am using the device that Parliament provided to me. I have the microphone, the device and all of Parliament's equipment. The IT service called me to try to help and I was not successful.
Mr. Chair, if I cannot do my job as a member of Parliament because Parliament's devices are out of order, my privileges as a member of Parliament are being curtailed. I call upon your wisdom to make a decision and resolve this matter so that, once and for all, members who participate in committee meetings are provided with all the equipment they need to be heard properly. Otherwise, our job as parliamentarians is at stake. This is a very critical period; being unable to question the Kielburger brothers properly is unacceptable to me.
It will be Mr. Trudeau's turn on Thursday and I have a feeling that the same thing will happen. It is my privilege, the privilege of all my colleagues, the other 337 members of the House of Commons, to be heard. We have the right to be heard on this committee and the witnesses must answer our questions.
Mr. Chair, I would therefore ask that you step in to ensure that we are provided with adequate equipment.
We are here because of conflict of interest. We have two unprecedented investigations of the and the on conflicts of interest in their relations with you.
When the chair of the board said that she was shocked to learn that the family members were being paid and wasn't aware of that, I'm glad you clarified that they were being paid for the ancillary events afterwards. That's something I've really been interested in about WE, because you are bringing major corporate players to the table. By having the 's family—the name is enormous—you're providing access to the Trudeau family.
Don't you understand or realize that this puts the into a serious conflict by your setting this up and paying a family to do this? This is the first part of the question. We have you setting up the Prime Minister by your actions in a conflict. But then we understand, after the mass layoffs in March, that you pushed out a document to various ministers. That's you lobbying, and yet you're not registered to lobby. You're very surprised. You can't understand how this all is going wrong for you.
The reason we have the lobbying registry is so that we can track how groups like yours interact with government. With your going under the radar, we don't have a clue, so we have to trust you. But I think the issue is this. Is it because of the issue of conflict, the issue that we have two investigations ongoing, and possibly a third now with ? The fact is that you didn't bother to register to lobby, and yet you're promoting a project that is going to net hundreds of millions of dollars. I don't see how guys, men as sophisticated as you, don't recognize the obligation to follow what every other charity in the country does, to register and to be tracked so that there's accountability. It's the lack of accountability that's really giving us a hard time believing you.
I'll start by just saying how frustrating it's been to be a part of this committee meeting. I am glad that we have ample time, thankfully. The inability of members to remain silent when it's not their turn to speak is deeply discouraging. I find it disrespectful. These are the kinds of things that we learned how to do in elementary school.
With respect, I know there was some controversy over the point made by Mr. Angus about how much money had gone. This is a thing the NDP has been pushing for weeks now. I note that the has put out a false tweet suggesting that the has given $900 million to his well-connected friends at WE. These are the kinds of things that we deal with and you kind of roll your eyes over.
The fact is, there's actually something that I want to kind of figure out here, because there's a legitimate issue going on. We've already had the issue discussed today about the fact that the 's mother is a well-known mental health advocate, but when I first saw that there was, in fact, a payment that went to her and that the government, of which her son is the Prime Minister, awarded a significant piece of work to have the student grant administered, I thought, “Okay, let's look into this” when the opposition pitched the study, and I won't prejudge what answers I hear.
I do have a couple of questions about those payments and whether they were in the ordinary course of things for an organization like yours. What I'm really curious about.... Is this a kind of thing you do often? You said there were other speakers who had comparable rates. Who are they? How much did they get paid? Was it on a similar scale to what Madame Trudeau was paid or was it much different? How are you arriving at these rates?
What I'm trying to figure out here.... If there's a habit of the organization to give significant grants exclusively to the governing party of the country, then I think there's something we have to look into. If this is the kind of thing where you take notable speakers with expertise in different areas and it was more or less par for the course, I'm also interested in knowing that.
If you could give me some answers on how much your other speakers were paid, who they were and the nature of how those relationships evolved, I would be very interested.
One of the most important revelations of today, at least for me, has been.... I know, Mr. Kielburger, you just spoke about it moments ago. It is a crucial revelation. This is the idea that there was no financial benefit for your organization in building and administering the program, the program being the Canada student service grant. I hear that and I take you at your word, of course.
What would you say to the average Canadian who would ask why you are involved in something like that? Why the interest in the Canada student service grant? What's in it for you? Was there a personal gain? Was there something along those lines?
Certainly I'm not making that judgment, but I think a lot of Canadians, when they hear you make the statement that there wasn't going to be a financial benefit, will say, what's in it for you guys? What's in it for WE?
:
You did it as a service, to help the government, but you were paid up to $43 million to do it. It is written in your contract. When I provide a service, I don't get $40 million or even a quarter of a million dollars. So, we will come back to the word "service" again later.
Whether it is $900 million or $500 million, the fact remains that it could go as high as $900 million. However, those numbers aside, I understand from your testimony that due diligence was not done. Ms. Wernick called you to chat. You did not speak to .
When I put the question to , he believed that due diligence had been done, that he had not seen it but that it had been done. I understand that we are in an emergency situation; you are right to say so. We are experiencing a pandemic and responding as best we can. However, do you not find it strange that you were awarded a contract to manage, let's just say, half a billion dollars? Let us stop getting bogged down in details. Really, it is only $400 million more.
You have a contract to manage half a billion dollars for which you are paid $43 million by individuals with whom you have ties, and with no due diligence, gentlemen. I am not taking anything away from the quality of the work you have been able to do in terms of volunteerism. You may have fulfilled an extraordinary mission. You may both be the next Mother Teresa for all I know.
However, I am checking to see what our government is doing with our money. I see a situation that seems extremely strange to me. I have never seen anything like it. So I ask you, who are in this business, how often are you asked to manage half a billion dollars and are paid $43 million. How often do you do it quickly, working on the back of an envelope, and with no due diligence?
I'm quite frankly not satisfied with a whole range of the answers that we've had today. Many of them haven't been answers. They've been, I think, speeches, but we're looking for answers here.
The issue of the insurance covering potential liabilities, which you've admitted are massive, is something that doesn't make sense in the context of putting a contract into what is a shell foundation. A shell foundation is a foundation with no assets. I would ask that you make all of the insurance documents available to us around the ESDC contract. I think that would be helpful for us to find answers that have not been forthcoming during this committee meeting.
I'm also concerned about board transparency. Michelle Douglas testified earlier that the board did not approve the setting up of the WE Charity Foundation.
How many of the many entities—at least a dozen in Canada and many, many more overseas—have been set up without the board actually approving the setting up of those entities?
:
Thank you, sir. A question we have never been asked by any journalist or anyone here today is what was lost when it came to young people in this process.
We had an extraordinary service opportunity lined up with Rotary and others to link young people to seniors to help document their lives to help overcome the reality of dementia, with so many seniors being in social isolation.
We had a beautiful program lined up with hospital networks, where there would have been support for nurses and their kids at home to make sure that they had digital mentors so that the nurses could take care of us and not be afraid.
We had a beautiful partnership lined up with Tim Horton's Foundation camps and others because all of the other camps had stopped over the summer, and young Canadians would have provided digital camp coaching experiences to these youth to help mentor and support them in this process.
All of this good was lost. All of these extraordinary service opportunities were lost. The fallout has been that young people are not earning income to support their tuition. I know it was criticized, but these teachers put up their hand over the summer to support 20,000 youth with direct supervision.
For WE Charity, to your comments, sir, the $5 million that we incurred in expenses is not the real issue here. This false information that's been circulated has been devastating to the charity. The charity got tagged “the WE Charity scandal” on this, when, in fact, the charity didn't make the final decision and wasn't involved in the process of declaring whether there was a conflict. All media have carried this around the world as the WE Charity scandal. It's been devastating to a Canadian charity through this whole process.
Frankly, there are days when we wish we had never answered the phone on April 19 when Rachel Wernick called asking for us to help.
It is incredibly unfortunate that the people who are bearing the worst cost in all of this are young people who don't have their summer placements. Because of the harm caused to WE Charity, for so many of the young people and children in Canada whom we served, we won't be able to provide the same programs in the years ahead.
We heard through your gruelling testimony, as you said, over the last four hours, time and time again the various theories that are out there, but I think it's very important that we end today's meeting by giving you the opportunity one more time to clarify certain untruths.
A theory is being put forward out there by the opposition and the media, implicitly and even explicitly, which comes down to the following: WE was having financial problems and a scheme was put together, with the concurrence of senior members of the government, to create a large student aid program using the pandemic as an excuse and to direct this contribution agreement to WE to save it financially, based on the profit they would make from the agreement. The implication is that the profit WE would make would be a payback for speaking fees, travel expenses, a job, and a trip given to the or and for political help to the Liberal Party of Canada.
Is this a true representation of what happened and if not, please address any inaccuracies that may exist in this theory. I kindly remind you that you are under oath.
:
This is decisively not a true representation of what took place. Allow me to walk through step by step on that time frame you outlined.
In the spring, like everyone else, we were affected by COVID-19. Like small businesses, non-profits and others across Canada, we had to make many difficult choices and, as the previous witness, Ms. Douglas, testified, it was a difficult time. We had to let people go who were like family to us, but that stabilized the organization. We had over eight months' of assets to carry us forward, long-term contracts with partners to implement projects, and we were in a solid financial position because of those prudent choices.
We were approached by the government, specifically Ms. Wernick, on April 19 to ask us if we were willing to implement a service program. In that case, we sent our best suggestions for her consideration, as per her request. An internal process in government, which we frankly can't speak much to, led at the end of the day to her request for us to work to create this during a pandemic, an extraordinary time of national crisis.
We did our best, created a program that had over 35,000 youth applicants, 64% of whom were people of colour, from coast to coast to coast, including the Northwest Territories, sir, with every other region represented. Through this process, unfortunately, the minute it was announced, it got enmeshed in a political controversy. We did our best. We handed everything over to the governments: the call centres, the manuals, the technology, hoping that the public service could continue to run it. We are heartbroken that it hasn't been able to continue, that the youth have faced these significant challenges as a result and, frankly, we're heartbroken that this whole process has not been a gift to our charity. Far from it. This is something that may destroy 25 years of work in building a national charity in this country, partially because of mistakes we made. We acknowledge and we apologize, but, frankly, significantly because of inaccurate and false information that circulated to the advantage of various groups seeking a political outcome here.
At the end of the day, we had one purpose, and one purpose only, in our actions. This was not about the government helping WE Charity. WE Charity sought to help the government and to help young people.
:
It's a very good note to end on.
I'm sorry, but we're out of time. We're actually over time.
Gentlemen, on behalf of the committee, I want to thank you—first, for requesting to appear for, I believe, it was an hour, and then agreeing to the will of the committee to meet for four hours. We had a lot of information tabled today, I think. I thank you for your forthright answers.
I thank the members for their questions as well.
With that, again, on behalf of the committee, thank you for appearing.
The meeting is adjourned.