PACC Committee Meeting

Notices of Meeting include information about the subject matter to be examined by the committee and date, time and place of the meeting, as well as a list of any witnesses scheduled to appear. The Evidence is the edited and revised transcript of what is said before a committee. The Minutes of Proceedings are the official record of the business conducted by the committee at a sitting.

For an advanced search, use Publication Search tool.

If you have any questions or comments regarding the accessibility of this publication, please contact us at accessible@parl.gc.ca.

Previous day publication Next day publication

37th PARLIAMENT, 3rd SESSION

Standing Committee on Public Accounts

EVIDENCE

CONTENTS

Monday, April 5, 2004

1110

The Chair (Mr. John Williams (St. Albert, CPC))

Mr. Dennis Mills (Toronto—Danforth, Lib.)

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

1115

Mr. Rob Walsh (Law Clerk and Parliamentary Counsel, House of Commons)

The Chair

Hon. David Dingwall (President and CEO, Royal Canadian Mint)

1120

1125

The Chair

1130

Mr. Gerald Keddy (South Shore, CPC)

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. Robert Thibault (West Nova, Lib.)

The Chair

Mr. Gerald Keddy

Hon. David Dingwall

1135

The Chair

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mr. Michel Guimond (Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans)

Hon. David Dingwall

Mr. Michel Guimond

1140

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

The Chair

Hon. Walt Lastewka (St. Catharines, Lib.)

The Chair

Mr. Michel Guimond

The Chair

Mr. Michel Guimond

Hon. David Dingwall

1145

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

The Chair

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

The Chair

Hon. Robert Thibault

1150

Hon. David Dingwall

Hon. Robert Thibault

Hon. David Dingwall

Hon. Robert Thibault

Hon. David Dingwall

Hon. Robert Thibault

Hon. David Dingwall

Hon. Robert Thibault

1155

Hon. David Dingwall

Hon. Robert Thibault

The Chair

Hon. Robert Thibault

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

1200

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP)

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

1205

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

Ms. Judy Wasylycia-Leis

Hon. David Dingwall

The Chair

Ms. Judy Wasylycia-Leis

The Chair

Hon. David Dingwall

The Chair

Mr. Jason Kenney (Calgary Southeast, CPC)

1210

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

The Chair

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

1215

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

Mr. Jason Kenney

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

1220

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

1225

Hon. David Dingwall

Mr. Michel Guimond

The Chair

Mr. Alan Tonks (York South—Weston, Lib.)

Hon. David Dingwall

Mr. Alan Tonks

1230

Hon. David Dingwall

Mr. Alan Tonks

Hon. David Dingwall

1235

The Chair

Mr. Michel Guimond

The Chair

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.)

Hon. David Dingwall

1240

Mrs. Marlene Jennings

Hon. David Dingwall

Mrs. Marlene Jennings

The Chair

Mrs. Marlene Jennings

Hon. David Dingwall

Mrs. Marlene Jennings

The Chair

Mr. Jay Hill (Prince George—Peace River, CPC)

Hon. David Dingwall

Mr. Jay Hill

1245

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

The Chair

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

1250

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

The Chair

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Jay Hill

Hon. David Dingwall

Mr. Alan Tonks

The Chair

Mr. Alan Tonks

The Chair

Mr. Jay Hill

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. Walt Lastewka

Hon. David Dingwall

1255

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

1300

Hon. Walt Lastewka

Hon. David Dingwall

The Chair

1355

Hon. Robert Thibault

The Chair

Mr. Marcel Proulx (Hull—Aylmer)

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

The Chair

Hon. David Dingwall

Mr. Marcel Proulx

1400

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

Hon. David Dingwall

Mr. Marcel Proulx

1405

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mr. Vic Toews (Provencher, CPC)

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mrs. Marlene Jennings

The Chair

Mr. Rob Walsh

The Chair

1410

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

1415

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

Hon. David Dingwall

Mr. Gerald Keddy

The Chair

Mr. Alan Tonks

The Chair

Mr. Dennis Mills

1420

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mr. Dennis Mills

The Chair

Mr. Alan Tonks

1425

Hon. David Dingwall

The Chair

Mr. Rob Walsh

The Chair

Mr. Marcel Proulx

Hon. David Dingwall

The Chair

Mrs. Judi Longfield (Whitby—Ajax, Lib.)

1435

Hon. David Dingwall

Mrs. Judi Longfield

Hon. David Dingwall

Mrs. Judi Longfield

Hon. David Dingwall

1440

Mrs. Judi Longfield

Hon. David Dingwall

The Chair

Mrs. Judi Longfield

Hon. David Dingwall

The Chair

Mrs. Judi Longfield

The Chair

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

1445

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Mrs. Marlene Jennings

1450

The Chair

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

Hon. David Dingwall

Mr. Vic Toews

The Chair

Mrs. Marlene Jennings

Mr. David Dingwall

Mrs. Marlene Jennings

Hon. Walt Lastewka

1455

Hon. David Dingwall

Hon. Walt Lastewka

Hon. David Dingwall

Hon. Walt Lastewka

1500

Hon. David Dingwall

Hon. Walt Lastewka

The Chair

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mrs. Marlene Jennings

The Chair

Mr. Michel Guimond

The Chair

Mrs. Marlene Jennings

The Chair

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

Hon. David Dingwall

Mr. Michel Guimond

1505

Hon. David Dingwall

The Chair

Ms. Judy Wasylycia-Leis

Hon. Robert Thibault

The Chair

Hon. Robert Thibault

The Chair

Hon. Robert Thibault

The Chair

Hon. Robert Thibault

The Chair

Ms. Judy Wasylycia-Leis

1510

The Chair

Ms. Judy Wasylycia-Leis

The Chair

Ms. Judy Wasylycia-Leis

Hon. Walt Lastewka

The Chair

Hon. Walt Lastewka

Mrs. Judi Longfield

The Chair

Hon. Walt Lastewka

The Chair

Mr. Vic Toews

The Chair

Mr. Marcel Proulx

Hon. David Dingwall

The Chair

Mr. Marcel Proulx

1515

Hon. David Dingwall

Mr. Marcel Proulx

The Chair

Hon. Robert Thibault

Hon. David Dingwall

1520

Hon. Robert Thibault

Hon. David Dingwall

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Hon. David Dingwall

The Chair

Mr. Vic Toews

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

1525

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

Mrs. Marlene Jennings

The Chair

Mrs. Marlene Jennings

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

1530

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Hon. David Dingwall

The Chair

Mr. Gerald Keddy

The Chair

Mr. Gerald Keddy

The Chair

Mr. Gerald Keddy

The Chair

Mr. Vic Toews

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

1535

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Vic Toews

Mrs. Judi Longfield

Mr. Derek Lee (Scarborough—Rouge River, Lib.)

The Chair

Mr. Vic Toews

Mr. Dennis Mills

The Chair

Mrs. Marlene Jennings

The Chair

Mr. Vic Toews

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

Mr. Vic Toews

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

Mr. Vic Toews

The Chair

Mr. Michel Guimond

The Chair

Mr. Michel Guimond

The Chair

Mr. Michel Guimond

The Chair

Mr. Michel Guimond

1540

The Chair

Mr. Marcel Proulx

The Chair

Mr. Marcel Proulx

The Chair

Mr. Victor Duret (Partner, KPMG)

1545

The Chair

Mr. Vic Toews

The Chair

Mrs. Marlene Jennings

The Chair

Hon. Walt Lastewka

The Chair

Mr. Alan Tonks

The Chair

Mr. Alan Tonks

1550

Mr. Victor Duret

Mr. Alan Tonks

Mr. Victor Duret

Mr. Alan Tonks

Mr. Victor Duret

Mr. Alan Tonks

Mr. Victor Duret

Mr. Alan Tonks

Mr. Victor Duret

Mr. Alan Tonks

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Victor Duret

The Chair

Mr. Victor Duret

The Chair

Mr. Victor Duret

1555

The Chair

Mr. Dennis Mills

Mr. Victor Duret

Mr. Dennis Mills

Mr. Victor Duret

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Vic Toews

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Dennis Mills

The Chair

Mr. Victor Duret

The Chair

Hon. Walt Lastewka

1600

The Chair

Hon. Walt Lastewka

Mr. Victor Duret

The Chair

Mr. Victor Duret

The Chair

Mr. Derek Lee

The Chair

Mr. Derek Lee

The Chair

Mrs. Judi Longfield

The Chair

Mrs. Judi Longfield

The Chair

Mr. Marcel Proulx

The Chair

CANADA

Standing Committee on Public Accounts

NUMBER 020

3rd SESSION

37th PARLIAMENT

EVIDENCE

Monday, April 5, 2004

[Recorded by Electronic Apparatus]

Á (1110)

[English]

The Chair (Mr. John Williams (St. Albert, CPC)): Order.

Good morning, ladies and gentlemen.

The orders of the day are, pursuant to Standing Order 108(3)(g), chapter 3, “The Sponsorship Program”, chapter 4, “Advertising Activities”, and chapter 5, “Management of Public Opinion Research”, of the November 2003 report of the Auditor General of Canada, referred to the committee on February 10, 2004.

Our witness this morning is the Honourable David Dingwall, president and CEO of the Royal Canadian Mint.

We are planning to go from now, which is 11 o'clock, until 4 p.m., but we will have a break for lunch at one o'clock. I've asked our forensic auditors to come forward at 3:30 to give the committee an update on the work they've been doing on behalf of the committee so that we can all be apprised of it.

Mr. Mills has given me notice of a point of privilege. Therefore, I will turn to Mr. Mills now to raise that point of privilege.

Mr. Mills.

Mr. Dennis Mills (Toronto—Danforth, Lib.): Thank you very much, Mr. Chair.

Last Thursday we all sat here, and Canadians witnessed testimony given to this committee by Mr. Toews. He said, and I quote:

What Canadians are asking is, who stole the $100 million, who stole the $100 million...?

He also said:

That money has disappeared. We want to find out where that money has gone.

I'm not going to go on with all his words, but I want to summarize by again quoting him from the transcript:

So we'll have Mr. Mills' report, Mr. Mills who miraculously found $100 million that the Auditor General couldn't find. The Auditor General who said the paper has all disappeared. Mr. Mills must have all this paper in his office.

Now, Mr. Chair, Mr. Toews and all committee members received two weeks ago—it's in the public record—a breakout from 1997 to the year 2000, by advertising agency, of where $70 million of that $100 million went in terms of professional fees, in-house production, travel and lodging, subcontract production, commission on production, and others.

I do not have the breakout of that $70 million, Mr. Chair, but by saying that all this money was “stolen”—and he is a former Attorney General from the province of Manitoba—Mr. Toews is causing grave difficulty for a lot of these agencies who received this $100 million, which apparently all of them stole.

Mr. Chair, again I want to quote Mr. Toews:

That money has disappeared. We want to find out where that money has gone.

Therefore, Mr. Chair and colleagues, I would seek from this committee unanimous consent that we summon immediately the chief financial officer and chief government relations person from the following advertising agencies: Gosselin, Everest, Palmer Jarvis, Vickers, Compass, Coffin, Groupaction, and Publicité Martin.

The Chair: Thank you very much, Mr. Mills, but you can't, in a point of privilege where you feel your privileges have been impugned, raise a motion to bring witnesses forward. The issue of whether the money has been stolen, mislaid, lost, or value...I'm sure is a matter for debate, not--

Mr. Dennis Mills: Excuse me, Mr. Chair, but Mr. Toews said “Who stole the $100 million?”

The Chair: Yes, I understand, and that's the question we're trying to find out. Therefore, your point of privilege is not a point of privilege. It's a matter of debate, and that's why we're here. We'll debate the issue.

So your privilege is ruled out. It's not a point of privilege.

Carrying on, there is a huge number of motions available. I don't want to spend all day, and nobody else wants to spend all day--

Mr. Dennis Mills: I have a point of order, Mr. Chair. It seems that the members of the committee didn't receive the breakdown of this money.

The Chair: It has been distributed.

Mr. Dennis Mills: I would ask the clerk of the committee to redistribute it. Obviously, Mr. Toews never saw it, because I'm sure he wouldn't have accused all these world-class agencies of stealing $100 million.

The Chair: Mr. Mills, we're not going to continue on with your point of privilege. It has been dealt with.

There are quite a large number of motions. They deal with times, meetings, witnesses, and so on. I'm going to call a steering committee meeting for 4:15, 15 minutes after the end of this meeting today, and we'll deal with those and report back tomorrow morning. So we'll put these motions aside at this point in time.

There are documents to be tabled. I have a letter from the Treasury Board of Canada, which is addressed to Mr. Robert Walsh, the law clerk and parliamentary counsel. It says:

Dear Mr. Walsh:

On March 11, 2004, certain statements were made by members of the Standing Committee on Public Accounts concerning communications between government counsel and government officials who may be called as witnesses before the Committee.

In light of those comments, I thought it might be useful to clarify the government's policy regarding the provision of legal services to government officials who may require them.

It is the policy of the Government of Canada, as an employer, to offer legal assistance to government officials (including current and former departmental officials, Governor in Council appointees and ministers) when, among other matters, they are required to appear before an inquiry as a result of the performance of their duties. This can include appearances before parliamentary committees. This policy is set out in the Treasury Board Policy on the Indemnification of and Legal Assistance to Crown Servants, a copy of which is enclosed.

I would be grateful if you would inform the Committee of the government's intention to continue its existing policy of offering legal assistance to government officials in such circumstances, and of the role of the Department of Justice in providing this assistance directly, where requested by the official, and where appropriate.

Please do not hesitate to contact me if you or the Committee have any questions or concerns regarding this matter.

Do you have anything to add, Mr. Walsh?

Á (1115)

Mr. Rob Walsh (Law Clerk and Parliamentary Counsel, House of Commons): No.

The Chair: That document is tabled and will be distributed.

I have a letter addressed to Mr. Jeremy LeBlanc, the clerk of the Standing Committee on Public Accounts, which says:

Dear Mr. LeBlanc:

The purpose of this letter is to present additional information as a follow-up to the November 2003 tabling...of the government's response to the Standing Committee on Public Accounts' 19th Report.

In that response, Public Works and Government Services Canada agreed to report back to the Standing Committee, no later than March 31, 2004, regarding the status of the seven recommendations presented in the report. You will find the progress report enclosed for your consideration.

I trust that this report will be satisfactory....

That is from Public Works, and it was signed by Mr. Marshall. That is tabled.

Mr. Dingwall, I cite this before a witness starts to give testimony:

...the refusal to answer questions or failure to reply truthfully may give rise to a charge of contempt of the House, whether the witness has been sworn in or not. In addition, witnesses who lie under oath may be charged with perjury.

That's from page 862 of House of Commons Procedure and Practice, by Marleau and Montpetit.

We welcome you here as a former member of Parliament and minister of the crown. This place is no stranger to you.

We now invite you to make your opening statement.

Hon. David Dingwall (President and CEO, Royal Canadian Mint): Thank you, Mr. Chairman and members of the committee. Thank you for this opportunity to appear before you today.

I would like to begin by emphasizing that when I was given the responsibility to serve in cabinet, I considered it a great honour and privilege. As minister, I was answerable for whatever took place within my portfolio and within my knowledge. I took very seriously my responsibility to Parliament and the people of Canada for both the successes and failures within my portfolio.

There were no sponsorship programs in Public Works during my tenure as minister from November 4, 1993, to January 25, 1996.

On the specific issue at hand, I would like to give a few brief comments on the situation I inherited upon my appointment 11 years ago.

Advertising and polling procurement was largely an unregulated area, with few policies and guidelines. In the vast majority of cases, the line departments had been awarding sole-source contracts to only a few select companies. To be fair, the matter goes back many years and several different governments. The system needed not a minor change but a major overhaul.

It is also relevant to note that the then information commissioner had successfully taken the federal government to court for secrecy and non-transparent government practices, in an effort to force the release of polling results. That is, the government of the day was paying for polls, yet refusing to release them. Taxpayers needed to be assured that we were spending their money in a prudent manner.

I believed then and I believe now that the taxpayers' interests are best served by competitive and transparent processes for the expenditure of public money. That principle guided my action on these matters then, as it does today.

The policy changes we initiated to reform federal contracting for advertising and public opinion research were substantial. In April 1994, the full cabinet approved the guidelines and directed Treasury Board to develop the necessary guidelines on contracting, in collaboration with the Department of Public Works and Government Services, and the PCO. In May 1994, in the House of Commons, I announced the first set of guidelines for government contracting for these services. It is worth repeating that these were the first ever written standards for advertising services.

Subsequently, Treasury Board ministers adopted these new policies and guidelines, and the Treasury Board Secretariat informed all line departments of the new contracting guidelines for implementation. As part of the open and transparent competition, all replies to requests for proposal were evaluated by a team of two departmental representatives, two private sector representatives, and two APORS representatives. The reforms were designed to bring the procurement procedures for advertising, public opinion research, and communications contracting into line with the overall contracting policy of the Government of Canada—again in line, not out of line, with the regular procurement procedures.

At the time we were starting from ground zero. There were no rules, no guidelines, nothing. We had to build everything from the ground up, and to initiate a level of reform across the government was not an easy process.

On guideline one, departments must balance their own communications, public opinion research, and advertising needs with the requirements of the government as a whole.

On guideline two, departments must ensure that work undertaken in communications, public opinion research, and advertising is used to advance the policy interests of the government. That is, communications could be used to purchase products and services designed to inform and to explain government policies and programs. Public opinion research was to be used to evaluate program effectiveness, or collect data that government needed to do its job. Advertising contracts were to be used to inform and explain government policy and programs to Canadians.

On guideline three, work undertaken in communications, public opinion research, and advertising should demonstrate the government's commitment to fiscal responsibility. Contacts were to be issued only when there was a clear need for the service, and no less-costly alternative was available. Also, departments were encouraged to work together so they could share results, avoid duplication, and reduce their costs.

Á (1120)

On guideline four, contracting for communication, public research, and advertising will be done in accordance with government regulations and policy. It is worth noting, Mr. Chairman, that for the first time contracts for these services were to be open to competitive bidding. All contracts worth $30,000 or more were to be publicly tendered. Line departments were responsible for developing precise statements of requirements, and the basis on which a contract was to be awarded was to be clear to all potential suppliers.

Furthermore, Mr. Chairman, no one company or agency was to be awarded excessive amounts of government business. Departments were expected to be vigilant in dealing with suppliers who might face a conflict of interest in contracting with the government and other clients.

The guidelines, Mr. Chairman, called on departments to be vigilant about these practices that were inconsistent with the spirit of contracting policies and regulations, such as contract splitting, contract amendments, and invalid justification for sole-source contracting. Public Works was the sole contracting authority for advertising in public opinion research by line departments, and it was also to monitor and report to Treasury Board on a quarterly basis on contracting activities and related compliance issues, which was right there in the contracting guidelines.

On guideline five, Mr. Chairman, the government operates on the principles of transparency and openness. Expenditures in public opinion research, advertising, and communications services would be tracked, and products resulting from contracts as well as the contracts themselves were to be routinely made available to the public; the first of these was in June 1994.

The government was committed to reducing the burden to the taxpayer for the cost of these services. Our goal was to reduce the overall spending in polls and advertising by 25%. In fact, we reduced it by 50%, to almost $60 million in 1994. This contrasted with the historical high level of around $140 million. The principles underlined in the new policy were those of openness and accountability through a fair and competitive process. In that way taxpayers were in a position to know if they truly received value for their money.

Of note, Mr. Chairman, was the fact that at the time these reforms were implemented, they were headed by an individual whom I did not know prior to assuming office but whom I subsequently learned to be Mr. Guité. The official reported to the deputy minister through the assistant deputy minister for government corporate services from August 1993 to July 1995 and from August 1995 to the remainder of my time at Public Works through the assistant deputy minister for government operations services.

Mr. Chairman, I left the position of Minister of Public Works and Government Services in January 1996. In November 1996 Ernst & Young performed an audit on the contracting processes of advertising in the public opinion research sector from June 30, 1994, to June 30, 1996, to determine whether it was in compliance with the policies that had governed the supply of advertising in public opinion research. I would like to quote from the general assessment of the audit:

Our audit of the research contracting process determined that APORS was in compliance with prescribed policies and procedures. With a few exceptions, the overall policies and procedures governing APORS were assessed as being appropriate.

Mr. Chairman, I have read the November 17, 1994, meeting notes that were provided to this committee. In this meeting the director of APORS is reported to have said he would talk to the minister to have the new advertising contracting rules and regulations changed. Mr. Chairman, that discussion never took place. My policy and guidelines were approved by cabinet and had just come into effect. I had neither the authority nor the wish to change these landmark guidelines, and that would have been a conversation I would have remembered. But to be clear, Mr. Chairman, I invested my credibility and that of my government in the establishment of the 1994 guidelines, and I had no intention of watering them down.

Mr. Chairman, members will know the backdrop and the context of what was happening in the two merged departments of Public Works and Supply and Services.

Á (1125)

Public Works and Government Services was going through a major and complex amalgamation of federal government departments, bringing some 19,000 people together, cutting over $350 million over a three-year period, and reducing the number of employees in that department by almost 40%. We also had to amend the Constitution to allow for the completion of the fixed link, the Confederation Bridge between Prince Edward Island and New Brunswick. At ACOA we implemented the first Atlantic Canada agreement on tourism, a very successful initiative that stands to this day. We also ended all grants to private businesses over a three-year period, reducing our expenditures by $173 million.

At Canada Post Corporation, we worked with senior officials and announced an end to the closing of rural post offices. At the Royal Canadian Mint, we were asked if we could provide more revenue to the consolidated revenue fund. As a result, we introduced the $2 coin, which over a three-year period contributed $720 million to the consolidated revenue fund. I was also, Mr. Chairman, responsible for several other crown corporations, and I expended a lot of effort and time in bringing the G-7 to Halifax in 1995.

I mention these activities to underscore my commitment to sound fiscal management and to ensuring that taxpayers receive value for their hard-earned dollars. I remained responsible for that portfolio until the end of 1995, and in January 1996 I became the Minister of Health.

Mr. Chairman, this concludes my remarks. I would be pleased to try to respond to the questions that members may have.

The Chair: Thank you, Mr. Dingwall.

Mr. Keddy, please, eight minutes.

Á (1130)

Mr. Gerald Keddy (South Shore, CPC): Thank you, Mr. Chairman.

I certainly would like to welcome Mr. Dingwall to committee and thank him for appearing here today.

Mr. Dingwall, with your 17 years of experience as a federal member of Parliament and a minister of the crown, I certainly don't have to caution you on the importance of this committee and the deliberations before us. You've been a professional politician yourself for many years, and a very distinguished one.

I do have a number of questions about your testimony and about your role in the beginning of the sponsorship scandal. Certainly I agree with your opening comment that you had nothing to do with the sponsorship scandal as it existed, because the sponsorship program didn't exist until 1997. But certainly the seeds of the sponsorship scandal and the sponsorship program had been planted long before 1997. They actually started to be nurtured, I believe, under your watch in 1993 and 1994.

Before we get into the issues surrounding sponsorship, there is one question that I think will predetermine a number of other questions here today. I believe you are probably familiar with and have read Mr. Guité's testimony; it's been released. Is that correct? Just a yes or no would be fine.

Hon. David Dingwall: Yes, Mr. Chairman.

Mr. Gerald Keddy: And you've read Mr. Cutler's testimony?

Hon. David Dingwall: Yes, Mr. Chairman.

Mr. Gerald Keddy: Would you be willing to publicly state today, Mr. Dingwall, that you would release Mr. Guité of any obligation to withhold information concerning any discussions you had with him while you were a member of cabinet--cabinet confidentiality?

Hon. David Dingwall: Mr. Chairman, I would be happy to comply with the request of the honourable member, but I think I'm bound by my cabinet confidences, however that works. There is no difficulty in my consenting to that request, but it would have to be made with that kept in mind, the cabinet confidences of that period of time.

The Chair: We received an order in council two or three weeks ago relieving ministers and former ministers of their cabinet confidentiality with respect to this particular investigation. I would have thought that you would have been apprised of that. If not, we'll get a copy to you right away. You cannot, under this investigation, claim cabinet privilege for confidence or failure to answer the questions. You have to be forthright.

Hon. David Dingwall: I'm very forthright, Mr. Chairman, as you will see.

The Chair: I know you are very forthright, but the cabinet confidences have been lifted.

Mr. Thibault.

Hon. Robert Thibault (West Nova, Lib.): Just for clarification, Mr. Chair, that is for the items related to the investigation, the relevant chapters of the Auditor General's report.

The Chair: That's correct, yes. It's pertaining to this particular investigation, chapters 3, 4, and 5 of the Auditor General's report.

Mr. Keddy.

Mr. Gerald Keddy: Thank you, Mr. Chairman.

In your opening statement, you went on at some length to assure this committee and Canadians who are watching this that you were the first minister of the crown to put controls in place; that in 1994 you instigated a regime that would allow, for the first time, for controls on spending on advertising. Yet the testimony of Mr. Guité and Mr. Cutler would tend to totally contradict that. I'll explain.

Mr. Allan Cutler has said that the current scandal predates the creation of the sponsorship program in 1997; rather, that it started with the removal of administrative controls at Public Works in 1994. He testified to that effect—that it was in 1994. I can't understand, if you were the minister responsible for putting controls in place, how a civil servant who was on the inside of your department would say absolutely the opposite of that--that rather, in effect, you were the minister responsible for removing controls.

Hon. David Dingwall: Mr. Chairman, through you to the honourable member, I think that is a fair question. I think it is a substantive question, and I think it deserves a full answer.

Firstly, I thank the honourable member for his opening comments. He is quite correct; there were no guidelines at the time we came to power in 1993. In 1994 we put the new guidelines into effect.

I think the honourable member would quite rightly agree that the testimony to which he has referred was a secret diary that was being kept by the witness who came before this committee. I think the nub of the question, Mr. Chairman, has to do with the watchdog function—the checks and balances.

I am sure the honourable member is fully aware that the management of a department does not rest with the minister. In fact the minister does not manage the department, does not make organizational changes, does not shift party here, party there. That is the function of the senior deputy minister and the senior officials of the department.

Coming to the issue of checks and balances, I think it is worth noting, Mr. Chairman, that there were substantive checks and balances with the new system—

Á (1135)

The Chair: Mr. Dingwall, if I may interject, Mr. Keddy's question was about your saying you were putting the checks in place and Mr. Cutler saying the opposite. I think Mr. Keddy is looking for a more direct response.

Am I correct, Mr. Keddy?

Mr. Gerald Keddy: You certainly are.

Hon. David Dingwall: Mr. Chairman, with respect, I'm trying to provide my evidence and the information I knew as minister responsible for Public Works and Government Services. The honourable member, quite rightly, has made reference to testimony that was placed before this committee. That testimony was a secret diary.

I was not aware of it, the deputy minister was not aware of it, the ADM was not aware of it; nor was the internal auditor aware of it until well after, in 1996. The question is, were there checks and balances? I'd like to provide information to the committee, if I may, Mr. Chairman, as to what those checks and balances were.

Mr. Gerald Keddy: I also have a question on Mr. Guité's testimony, Mr. Dingwall.

Mr. Guité told the committee that normal rules and regulations should not apply—or told Mr. Cutler and Public Works and Government Services staff that normal rules would not apply to advertising contracts. He said directly in his testimony that he would talk to the minister and have them changed. You were the minister. Why did you have them changed?

Hon. David Dingwall: Mr. Chairman, I think I responded to that question quite clearly in the submission I made before the committee. I was not privy to conversations that may have taken place between these two individuals the member makes reference to, but I can tell the honourable member, as evidenced through my statement quite clearly, I had no intention of changing the guidelines cabinet approved.

And If I may say so, Mr. Chairman, there is a principle here of ministerial responsibility—

An hon. member: Or lack of it.

The Chair: You just said you didn't have any.

Hon. David Dingwall: May I, Mr. Chairman?

The principle is this: when cabinet made the decision, I neither had the authority nor the will to change those. I would have had a sign-off by my ADM and by the deputy minister. I would have had to go back to cabinet, and cabinet would have had to change those guidelines. That's why I remember that conversation never took place, Mr. Chairman.

The Chair: Thank you very much, Mr. Keddy.

Monsieur Guimond, eight minutes.

[Translation]

Mr. Michel Guimond (Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans): Thank you, Mr. Chairman.

Mr. Dingwall, can you tell me who succeeded you as Minister of Public Works?

[English]

Hon. David Dingwall: I believe, Mr. Chairman, the testimony is that the Honourable Diane Marleau succeeded me.

[Translation]

Mr. Michel Guimond: That's correct. When she testified before the committee, Ms. Marleau stated the following, and I quote:

As I told you, when I arrived, Mr. Guité said that he reported to the office of the Minister. I refused to go along, insisting that he follow the normal program guidelines.

Ms. Marleau said that things didn't always work that way in an organization where a chain of command was in place and that as a rule, the director of a program did not report directly to the minister's office.

On page 9 of your submission, you describe a somewhat theoretical situation. You state that Mr. Guité reported to the Deputy Minister through the Assistant Deputy Minister for Corporate Services and subsequently, until the end of your mandate, through the Assistant Deputy Minister for Government Operational Services. Would you agree that Ms. Marleau's testimony completely contradicts what you said in your submission?

Á (1140)

[English]

Hon. David Dingwall: Mr.Chairman, I'm not here to give testimony for Madam Marleau. She said what she said.

I believe Mr. Quail, before this committee, said the following: “The reporting relationship did change during the tenure. Before 1997 the reporting responsibility for Mr. Guité was to an ADM of government operational services.”

[Translation]

Mr. Michel Guimond: As Minister, how often did you meet with Mr. Guité?

[English]

Hon. David Dingwall: Mr. Chairman, I can't recall how many times I met with whatever public servant during my tenure as minister. I would have met him as the situation would have warranted, and of course the reporting mechanism would have been through the ADM up to the deputy minister.

[Translation]

Mr. Michel Guimond: Did you meet with him several times a year, several times a month or several times a week? You haven't lost the touch you had as Minister, from 1993 to 1997, when questions were being put to you in the House. You never answered the questions directly. Did you meet with him several times a year, several times a month or several times a week?

[English]

Hon. David Dingwall: Mr. Chairman, it's been 10 or 11 years since I was the Minister of Public Works and Government Services. I met with many officials across the country--directors general, all sorts of individuals--from time to time. How many times I met a particular individual, I can't recall. But if I met an individual, it would have been based upon a particular issue that had come forward.

[Translation]

Mr. Michel Guimond: There's a certain individual by the name of ...

[English]

The Chair: Monsieur Guimond, s'il vous plaît, Mr. Lastewka is raising a point of privilege.

Hon. Walt Lastewka (St. Catharines, Lib.): Mr. Chairman, there have been experiences in the past in which the questioners have been a little bit sarcastic. We have received information along the line that we should respect the witnesses, ask very tough questions but keep the sarcasm to ourselves, and I think as chairman you need to protect that, as a member of this--

The Chair: Thank you, Mr. Lastewka.

That is not a point of privilege, but Monsieur Guimond, we can't make statements regarding when a person was a member of this House and a member of the government, answering questions in question period. That was a different time, though maybe not a different place. But this is a witness before the committee, and to make the comparison that his answers here would be the same as answers as a minister of the crown in the House of Commons...that's a different situation. So recognize that as you ask questions, please.

[Translation]

Mr. Michel Guimond: I hope that this last intervention doesn't count against my alloted time.

[English]

The Chair: No, it does not. The clock was stopped during the intervention.

[Translation]

Mr. Michel Guimond: Thank you, Mr. Chairman.

Now then, Mr. Dingwall, Allan Cutler, an official with PWGSC, explained to us how advertising contracts were managed. He told us that from 1980 up until the end of 1994, during which time you held the portfolio, two separate groups were in charge of advertising. The first was responsible for selecting the advertising firms and for doing follow-up work, while the second was in charge of negotiating the contracts with the firms retained.

Can you tell us what led to your decision to merge the two groups?

[English]

Hon. David Dingwall: Again, Mr. Chairman, it's a very valid question. Perhaps I may take a moment here to explain.

In June or July of 1993, the former Prime Minister, Madam Campbell, appointed Mr. Quail as the deputy minister and merged the Departments of Public Works and Supply and Services. In November 1993, Mr. Chrétien reappointed Mr. Quail to the merged department and collapsed the cabinet committee on communications.

Thereafter, I think it explains this little box that I think Mr. Marshall had made reference to in his testimony, where it became obvious to us that there were no guidelines. We established a process to consult, and shortly thereafter, in May 1994, we came forward with a set of guidelines, which were approved by the cabinet.

As I indicated previously, Mr. Chairman, to the honourable member, the organization of the department is the function of the senior deputy and of the senior people within that particular department. Ministers don't say where this goes or that goes. That's a responsibility because it's a management function.

Á (1145)

[Translation]

Mr. Michel Guimond: Allan Cutler also spoke to us about a meeting that took place on November 17, 1994 -- a meeting which you alluded to in response to an earlier question from Mr. Keddy -- between Charles Guité and the group responsible for advertising contracts.

Mr. Cutler said the following, and I quote:

At this meeting, Mr. Guité told us that the normal rules and regulations should not apply to advertising. He said he would talk to the minister to have them changed.

Was he indeed referring to you, given that you were the minister at the time?

[English]

Hon. David Dingwall: Yes, Mr. Chairman, it was.

[Translation]

Mr. Michel Guimond: I'd like to know what changes were made and why you decided to change the rules for awarding contracts.

[English]

Hon. David Dingwall: I'm sorry, I didn't get the translation.

[Translation]

The Chair: Could you repeat the question, please, Mr. Guimond?

Mr. Michel Guimond: You were in fact the minister in question. I'd like to know what changes were made and why the decision was made to change the rules for awarding contracts.

[English]

Hon. David Dingwall: Mr. Chairman, I thought that I explained in my opening statement, quite clearly—and it's a fair question coming from the honourable member—that evidence was given with regard to a conversation in which somebody was alleged to have something, but I couldn't change that. Why couldn't I change that? It was a cabinet decision. It would have required sign-off by a deputy, by an ADM, by myself, and it would have required an amendment by the cabinet. The cabinet was in no mood, and I was in no mood. There was nothing forthcoming from my ADM or from my deputy minister.

It didn't happen, Mr. Chairman.

[Translation]

Mr. Michel Guimond: Who was your Chief of Staff at the time?

[English]

Hon. David Dingwall: The head of cabinet? Jean Chrétien.

[Translation]

Mr. Michel Guimond: I'm happy to hear that you thought Mr. Chrétien reported to you.

[English]

Hon. David Dingwall: Mr. Kinsella.

[Translation]

Mr. Michel Guimond: Was it in fact Mr. Warren Kinsella?

[English]

Hon. David Dingwall: Yes, sir.

[Translation]

Mr. Michel Guimond: How long did he serve in this capacity?

[English]

The Chair: I apologize, but we've gone a little over your time. I gave you a little extra because of the number of interventions along the way, but we have run out, I'm afraid.

Mr. Thibault, s'il vous plaît, eight minutes.

Hon. Robert Thibault: Thank you, Mr. Chairman.

Mr. Dingwall, welcome to the committee, and thank you very much for your testimony.

As you recognize, we are dealing with a very, very serious matter. We're looking at a system that has failed; we're looking at the report of the Auditor General showing that a program, which you will understand was very important to Canadians, was in some aspects abused. We've also created the perception out there that $100 million of public funds were misused. We know, as you would, that's not the whole truth, but we do know that in some instances some of those commissions were used in a questionable manner.

We have many lines investigating this. We have the RCMP; we will have the courts, as matters are referred to them; we have a public judicial inquiry; and we have a counsellor seeking the funds that were misappropriated. But as a committee, we want to know—and I think you are an ideal person to help us with this—how the federal system, how the ministerial and administrative system, could fail so that such a thing could happen.

One of the areas you're particularly well equipped to help us with is the question of ministerial responsibility. You and I would both understand the ephemeral nature of ministerial roles and the professional and stable nature of the bureaucracy. We benefit in Canada from a professional bureaucracy, which doesn't change from election to election and isn't at the whim of the political process. There is a role for each.

Could you elaborate on how you saw your role within the administration of such an important program, including with advertising, public opinion research, and the role of your administrative staff or the bureaucracy?

Á (1150)

Hon. David Dingwall: Mr. Chairman, in my understanding of ministerial responsibility, I think it has three major tenets. The first one would be the collective responsibility of the cabinet as a whole; second, it would be the individual responsibility of the minister of a particular portfolio; and the third tenet, which I think is important, is the anonymity of public servants.

Ministers and governments are concerned with policies and broad objectives. In my role as the Minister of Public Works, I was leading the department with regard to the policy development and had the added responsibility, pleasure, and privilege of reporting to and accounting to Parliament.

Public servants are the managers of the programs within their respective departments and agencies. Ministers of the crown should not be, and are not, involved with how managers manage a particular program, organize that particular program, and/or promote people within that particular sector.

That's my idea and understanding of ministerial responsibility and how we tried to carry it out.

Hon. Robert Thibault: Thank you.

We've seen evidence or had testimony to this committee indicating that when funds were allocated for any of these purposes in your time and that of others, there was always the caveat or proviso that it should be done under the guidelines of the Financial Administration Act and Treasury Board restrictions.

Mr. Dingwall, would those be the responsibility administratively of the minister, the deputy minister, or whom?

Hon. David Dingwall: Well, in terms of monitoring and making sure that certain rules and regulations were complied with, those are the responsibility of the central agency, which we now refer to as the Treasury Board and the Treasury Board Secretariat in terms of moving forward. There are other central agencies of the Government of Canada, but that is the one that has the responsibility of adhering to the various rules and regulations set out by a myriad of departments and agencies.

Hon. Robert Thibault: Mr. Guité is often mentioned to this committee as central, and he was under the employ of your department, as was Mr. Ran Quail.

When did you appoint these gentlemen to your department?

Hon. David Dingwall: Again, Mr. Chairman, that's one of the common perceptions, that ministers appoint various senior people within their department. With deputy ministers, it has been a longstanding tradition, not only of the present Prime Minister but also of previous prime ministers—Mr. Chrétien, Madam Campbell, Mr. Mulroney, Mr. Trudeau—that they're appointed by the Prime Minister in concert with the Privy Council Office. So ministers rarely have an opportunity in terms of a deputy minister being assigned to their department, though some of them like to think that they have a say.

Thereafter, appointment within a department or agency is the function of the deputy minister in concert with PCO. I would presume that in some instances Treasury Board and of course the Public Service Commission would be the ones with the authority to move those files along—but not a minister.

Hon. Robert Thibault: But the question would be, did these gentlemen join the department while you were minister?

Hon. David Dingwall: Mr. Quail joined the department, I think by his own testimony, in June 1993 or July 1993 when the Departments of Public Works and Supply and Services were combined, and I believe that's when Mr. Guité came under the rubric of Public Works and Government Services Canada.

Hon. Robert Thibault: One of the interesting elements for me, in some of the testimony we've seen and some that I've read, is the question of meetings with the minister and instructions from the minister. I would ask you generally, Mr. Dingwall, has it been your experience that bureaucrats meeting with members of a minister's staff could leave those meetings and indicate that the directives he is giving to subordinates are the wishes of the minister, the desires of the minister, the instructions of the minister, or giving the impressions that they are receiving personal instructions from ministers?

Á (1155)

Hon. David Dingwall: I think each minister in each portfolio and each deputy is different. The relationship you would have with your deputy may be different from what another minister may or may not have. In my tenure, both in Public Works and in Health, there were always representations coming from a variety of stakeholders, members of Parliament, senators, who would want to know certain things. You would pass the information on to the appropriate authority and you would get the information back. Does all of that information have to go through a deputy's office? The actual fact is no, because the system would come to a crashing halt if that's the way things operated. So there are representations going back and forth. That's the way I understood it to work, but each minister, each portfolio, may be different, depending upon his or her deputy.

Hon. Robert Thibault: I have one final point, and I refer to you a quote from a former Minister of Supply and Services, the Honourable Harvie Andre, in the House of Commons in 1985:

I would also inform the Hon. Member that the advertising business is not susceptible to the tendering process. The agencies are paid a percentage of the total advertising budget. That is the way it is done. I do not think it is within our capacity to change that practice that has been in place for 100 years.

So I think you undertook to change a century of precedent, and we saw that there were some elements that did not work--

The Chair: Mr. Thibault, your question.

Hon. Robert Thibault: Would you do anything differently if you were in that position again?

Hon. David Dingwall: Mr. Chairman, I want to be fair and I don't want to sound partisan, but the issue--

The Chair: Yes, go ahead, Mr. Dingwall.

Hon. David Dingwall: Mr. Chairman, I'm glad to be back.

But I think it would be fair to all the committee members that the problem, in terms of the guidelines going in in 1994, was not the result of just that previous administration. It went back to 1980, if not earlier than 1980. And that's why it was so difficult to change. But we thought we made the right change and had the right objectives put in play in order to arrive at the kinds of public policy that we thought the country needed.

The Chair: Thank you, Mr. Thibault.

Mr. Dingwall, I was a little taken aback when you were talking about your perception of ministerial responsibility. One, you talked about the collective responsibility and....

Somebody has a cellphone on around here.

Hon. David Dingwall: It's not me, Mr. Chairman.

The Chair: Yes, it must be the PMO.

Mr. Dingwall, you talked about the collective responsibility, your individual responsibility, but you didn't seem to say that you felt, as a cabinet minister, you were responsible for the activities of your department and therefore if things went seriously wrong in your department you, as a minister, should be held accountable for whatever goes on in the department. Do you agree with that concept of ministerial accountability as an individual?

There's another cellphone going on around here. Will people please turn off their cellphones?

Mr. Dingwall, what is your perception of your individual responsibility as a member of cabinet?

Hon. David Dingwall: Mr. Chairman, I thought I made it very clear.

The Chair: No, I didn't find it very clear.

Hon. David Dingwall: You didn't find it very clear. Well, let me make it very clear for the chairman and other members.

Yes, Mr. Chairman, as the minister responsible, I was responsible and accountable to Parliament for what happened during my watch as the Minister of Public Works and Government Services, end of statement.

Â (1200)

The Chair: Within your department?

Hon. David Dingwall: Within my department and within my knowledge of all of the things. My department, so that we're clear, Mr. Chairman, exceeded much more than only the Department of Public Works and Government Services.

Can I go on for a moment?

The Chair: Please, yes.

Hon. David Dingwall: I was a little testy, Mr. Chairman, when the Deputy Minister of Public Works, Mr. Marshall, laid before Parliament the organizational chart of the Department of Public Works and Government Services. That was fine, but put forward the organizational chart of the full minister's portfolio, including all of the crown corporations and various agencies a minister has to be responsible for.

I am saying through you, Mr. Chairman, to the other members of the committee, I was fully responsible and fully accountable for Public Works and Government Services, and all of the other agencies I was responsible for from 1993 to January 25, 1996.

The Chair: Thank you very much.

Ms. Wasylycia-Leis, please, eight minutes.

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Thank you, Mr. Chairperson.

Mr. Dingwall, you said a couple of times that some of the problems we're dealing with in this period of time go back a couple of decades, to the 1980s perhaps. One of the common links in terms of these troublesome times in advertising and sponsorship appears to be Chuck Guité.

Were you part of the Liberal cabinet ministers, backbenchers, who raised concerns about Chuck Guité in 1993 and his tenure in Brian Mulroney's time? Did you advise Jean Chrétien about whether he should stay on or not?

Hon. David Dingwall: No, Mr. Chairman, through you to the honourable member, I didn't even know or know of the particular individual you refer to as Mr. Guité. The answer is no.

Ms. Judy Wasylycia-Leis: To go back over this period of time, from 1993 to January 1996, you were the Minister of Public Works.

Although the sponsorship program didn't officially begin until 1998, I believe, before that period of time, there was the advertising and public opinion research sector. Who was head of the sector during your tenure?

Hon. David Dingwall: I believe it was Mr. Guité.

Ms. Judy Wasylycia-Leis: You didn't have any knowledge of Mr. Guité before you became minister or at the beginning of your ministry?

Hon. David Dingwall: No, Mr. Chairman. As I indicated earlier, I had not known these individuals, Mr. Guité and Mr. Quail. They came to the Department of Public Works and Supply and Services, I presume, when the departments merged in 1993. I did not know Mr. Quail and I did not know Mr. Guité.

Ms. Judy Wasylycia-Leis: To put those comments in perspective vis-à-vis what Madam Marleau had told us, can you give us any reason why, after your tenure as Minister of Public Works, Mr. Guité showed up at Diane Marleau's door and said “I report to you”?

Hon. David Dingwall: Mr. Chairman, I can't respond to that. I would have no idea as to why the member had said that. You'll have to ask her and get the details.

Ms. Judy Wasylycia-Leis: You're categorically rejecting any notion that Mr. Guité reported directly to the minister, probably somewhere, at least beginning in 1994?

Hon. David Dingwall: Mr. Chairperson, again, I think it's a fair question that the honourable member raises, but Mr. Quail, in his testimony on June 13, 2002, under a question from a member of the party to your left, stated the following:

The reporting relationship did change during the tenure. Before 1997 the reporting responsibility for Mr. Guité was to an ADM of government operational services.

Ms. Judy Wasylycia-Leis: Could you tell us the rules that were in place for awarding contracts and the selection of advertising agencies in your period of time?

Hon. David Dingwall: Mr. Chairman, the member, from reading my statement, will now know that in 1994 they were the first guidelines that had ever been produced by a federal government. They were the first guidelines in 1994 that were ever produced by a provincial government. No provincial government had done this and no federal government had done this, up until that point in time.

There were a number of checks and balances that the Deputy Minister of Public Works, Treasury Board, and PCO had put in place to make sure that things were going to happen in a prudent way. APORS, for instance--if I may...?

Ms. Judy Wasylycia-Leis: You may, but perhaps you could zero in on my question. I read your statement and listened to your words, but I still don't know how the criteria led to the selection primarily of what appeared to be Liberal advertising agencies, or those agencies that gave considerably to the Liberal Party, and excluded many other firms. So I'd like to know what criteria led to that kind of situation under your ministry.

Â (1205)

Hon. David Dingwall: Again, that's a fair question. The checks and balances that had been put in place in responding to the objectives and guidelines cabinet had approved.... Let us remember that APORS had a very small administrative budget. All moneys for advertising, polling, and communications remained with the line department. There was a separate evaluation team, with representatives from the line department, APORS, and the private sector, which had never been done before--

Ms. Judy Wasylycia-Leis: All right. Could I interrupt--

Hon. David Dingwall: Mr. Chairman, if I may, the honourable member has asked a very important question, and I'm trying to give a fulsome answer on what I believe to be very important and what she believes to be very important. I have just three more points, if I may.

Ms. Judy Wasylycia-Leis: All right.

Hon. David Dingwall: Line departments, not APORS, sent the cheque for the service to the agency of record. There was then full disclosure and public release of all information on the contracts in question. Finally, there was a regular reporting to Treasury Board on a quarterly basis of all the contracts, all of the competed contracts, because all contracts had to be competed. That was the process that was used.

Ms. Judy Wasylycia-Leis: That's certainly not consistent with the testimony we heard from a very credible witness. The whistle-blower, Mr. Allan Cutler, came forward and was very clear about the fact that rules were being broken. Your continued avoidance of that testimony is not helpful to our work today.

We know you would have heard what Mr. Allan Cutler was saying. That was well known in the department during your time and well known at ministerial levels. I think it would be useful for us to know why you didn't act on that advice. Did you call Mr. Allan Cutler into your office to try to get to the bottom of it? If you didn't, why not?

That's another fair question, right?

Hon. David Dingwall: The honourable member makes reference to testimony that was placed before this committee. I'm not suggesting for one moment that the witness was in any way not in full sync with what was taking place. The only problem I have is that it was a secret diary he had kept.

Ms. Judy Wasylycia-Leis: There was nothing secret about this. It was well known. He took his concerns to the department, and it was clear in fact--

Hon. David Dingwall: If I may, Mr. Chairman--

The Chair: Ms. Wasylycia-Leis--

Ms. Judy Wasylycia-Leis: Mr. Chairperson, I think it's only fair that we get to the bottom of this. This is wasting our time too, you know.

The Chair: All right.

Mr. Dingwall, you have the floor.

Hon. David Dingwall: I respectfully disagree with the member. I think she's way off in her analysis. This was a secret document that did not become available to the deputy minister, did not become available to the assistant deputy minister, and did not become available to the internal auditor until the formal complaint was made late in 1996.

No one in a position of responsibility knew anything about what this gentleman was referring to, because had they known they would have taken action.

The Chair: Thank you, Ms. Wasylycia-Leis.

Mr. Kenney is next, for eight minutes.

Is it agreed that we continue with eight-minute rounds all day, instead of going to four-minute rounds?

Some hon. members: Agreed.

The Chair: We'll have eight-minute rounds all day.

Mr. Kenney, please.

Mr. Jason Kenney (Calgary Southeast, CPC): Thank you, and welcome to the committee, Mr. Dingwall.

Picking up on your last statement, the problem is that people in authority clearly did know that rules were being bent, if not broken, in your department during your tenure as minister. For example, I cite the testimony released on Friday given by Mr. Guité to this committee in camera two years ago, in which he said:

During the referendum of 1995 my office was requested by the Federal-Provincial Relations Office to hold a competition--I have to be careful here the term I use--and to follow a bit of the guidelines that exist in the rules, but I may have to, for a better term, bend them a little bit....

So how could it be that during your tenure as Minister of Public Works, Mr. Dingwall, Mr. Guité was receiving instructions from an organ of the Privy Council Office to bend the rules without your knowledge? Or were you aware of that?

Â (1210)

Hon. David Dingwall: Mr. Chairman, as Minister of Public Works and Government Services, I led the department in terms of developing the policy, and I was accountable to Parliament for that.

I was aware of and supported the objective of providing additional advertising in the province of Quebec during a very difficult time in the history of the federation. Mr. Chairman, I don't manage the programs. I don't manage various contracts for various contracting agencies of the Government of Canada. That is something for the department to do.

If the honourable member is asking me if I was aware of and agreed with the objective of the federal forces providing more advertising in the province of Quebec during the referendum, the answer is yes, Mr. Chairman.

Mr. Jason Kenney: No, I'm not asking you that, so your answer is not pertinent to my question.

Were you aware of the Federal-Provincial Relations Office--that is to say, an organ of the Privy Council Office, the centre of the government--contacting a manager in your department and asking that he bend the rules?

Hon. David Dingwall: Mr. Chairman, I was aware of the objective, but I was certainly not aware of the bending of the rules, the breaking of the rules, the amending of the rules, none whatsoever.

Mr. Jason Kenney: So you would have us believe, then, that the Federal-Provincial Relations Office circumvented you with this pretty startling directive to a manager in your department asking him to bend the rules and that you were just left in the dark and were blissfully ignorant about this.

Hon. David Dingwall: Mr. Chairman, I think the honourable member is making somewhat light of a very difficult situation in the history of our country. The issue was quite pronounced. There was a lot going on in the province of Quebec. Ministers of the crown, including myself, were aware of the significance of the referendum to the future of the country. We certainly had an obligation on the part of the federal forces to convince our friends in the province of Quebec that they should remain. We were up against a separatist government that was sanctioned by the provincial government in terms of their advertising. So I don't take any exception, Mr. Chairman, with regard to supporting the advertising in the province of Quebec.

The Chair: I don't think we're into a political statement here, Mr. Dingwall.

Mr. Jason Kenney: Mr. Chair, what Mr. Dingwall has just done is paint the same picture Mr. Guité did in his testimony about a wartime atmosphere where the end justified the means, in the words of the former Prime Minister. This was a critical issue, as Mr. Dingwall has testified. This was about saving the country. Is he having us believe that with perhaps the most important thing going on in his department at the time, engaging in war to save the country, he was unaware of how that program was being conducted?

Hon. David Dingwall: Mr. Chairman, I repeat for the honourable member that I was not aware. I became aware, as did all other members, of the testimony to which he refers last Friday, in terms of the bending of the rules. That was the first time, Mr. Chairman, that I became aware of that.

Mr. Jason Kenney: The problem here, Mr. Dingwall--and this was the problem with Mr. Gagliano in his evidence before us--is that in assessing your conduct, you're asking us to choose either incompetence, in that you didn't know what was happening on a critical file in your department, which was clearly a priority for the Prime Minister, or that you're not being completely forthcoming about your knowledge. That's the situation you're putting us in, Mr. Dingwall.

Let me make reference to Mr. Guité's testimony. He talks about calling up ad agencies almost on a whim and buying $8 million worth of outdoor advertising inventory on the basis of a verbal agreement. Are you telling us that a mid-level manager in your department could make an $8 million ad purchase on the phone without anybody in your office or yourself knowing about it?

Hon. David Dingwall: Mr. Chairman, through you to the honourable member, I disagree with the premise of his question.

As the minister, I agreed with the objective in terms of additional advertising in the province of Quebec, and I was responsible for that. I had full confidence in my deputy minister and senior officials that it would be carried out accordingly.

Mr. Jason Kenney: But was it, in your view, in retrospect, carried out accordingly, Mr. Dingwall?

Â (1215)

Hon. David Dingwall: I think we have to have the witnesses come forward and explain in terms of what transpired. I read the testimony, as you did, and I was quite surprised.

Mr. Jason Kenney: Let me ask the question again. Were the guidelines followed in your department during your ministry?

Hon. David Dingwall: To the best of my knowledge, yes, they were.

Mr. Jason Kenney: To the best of your knowledge? Do you say that today—that they were followed—knowing now what you do, with the testimony before you that you're clearly well acquainted with? Do you still maintain that the guidelines were followed?

Hon. David Dingwall: Clearly, from the testimony with regard to the advertising that went on before the referendum in the province of Quebec, listening to what Mr. Guité has said—and he made reference to the bending of the rules—obviously my rules were not being followed, Mr. Chairman.

Was I aware of the objective? Yes. Did I manage the program? No, I did not manage it. That was the responsibility of senior individuals within the department, namely the deputy minister and senior officials, and I had full confidence.

Mr. Jason Kenney: This is my problem, Mr. Chairman. It's well known that Mr. Dingwall was a very close confidant of the former prime minister. Mr. Chrétien had full confidence in Mr. Dingwall. It's obviously well known that Mr. Chrétien had winning the referendum as his principal political objective.

That would seem to explain why the Privy Council Office called up a manager in Mr. Dingwall's department and said, “We need you to bend the rules to do whatever you can to win this war.” And he went out and spent $8 million on the phone in one call, and Mr. Dingwall was just blissfully sitting in his office expecting that the rules would be followed. How can you expect us to believe that, Mr. Dingwall?

Hon. David Dingwall: Mr. Chairman, the political objective the honourable member makes reference to was not only an objective of the former prime minister. It certainly was the objective of the former leader of the Progressive Conservative Party and of many Canadians across the country.

Mr. Jason Kenney: It's not the objective we're talking about; it's the means, not the end.

Hon. David Dingwall: Well, I wish to talk about the objective; then I will address the means you're talking about.

Mr. Chairman, the responsibility of the minister, as I've indicated in previous testimony, is the objective in the policy. I agreed with the policy and agreed with the objective and supported the objective—

Mr. Jason Kenney: The question was, were you ignorant or knowledgeable of the means?

Hon. David Dingwall: In terms of knowing—

The Chair: Thank you—

Hon. David Dingwall: —what contract was awarded at what time, Mr. Chairman, I was not made aware.

The Chair: Thank you very much, Mr. Kenney.

Now it's Monsieur Guimond for the Bloc, for the second time.

[Translation]

Mr. Michel Guimond: Thank you, Mr. Chairman.

I have another fair question for you and I hope I'll get a fair answer.

Mr. Dingwall, on page 8 of your submission, you refer to Guideline 5: “The government operates on the principles of transparency and openness.”

Let me say right away that I don't want you to answer that it's in your document, because that's not the case. I want to talk about the National Unity Fund. Since we are talking about principles of transparency and openness, what can you tell us about the national unity fund?

[English]

Hon. David Dingwall: Very little, Mr. Chairman.

[Translation]

Mr. Michel Guimond: Can you elaborate further?

[English]

Hon. David Dingwall: I'm sorry?

[Translation]

Mr. Michel Guimond: Can you elaborate on “very little”?

[English]

Hon. David Dingwall: Mr. Chairman, in 1995 I think the main estimates and supplementary estimates made mention of moneys that would be used for the purposes of what was going to be taking place in the province of Quebec. That is the extent of my knowledge of a particular reserve fund, if that's the name it was given, or a unity fund. I'm not familiar with the details of that, Mr. Chairman.

[Translation]

Mr. Michel Guimond: As Minister, had you had occasion to use this fund?

[English]

Hon. David Dingwall: Not to my knowledge, Mr. Chairman.

[Translation]

Mr. Michel Guimond: Can you give us some examples of projects that were financed with money from this fund?

[English]

Hon. David Dingwall: Mr. Chairman, it was not part of my portfolio. I would have no reason to know what projects went forward or didn't go forward, so I don't know.

[Translation]

Mr. Michel Guimond: Did you attend meetings at the Privy Council Office or at the PMO to discuss projects associated with the referendum or designed to enhance the government's visibility? Earlier, you told us that you agreed with the aims of the visibility program and that you were aware of the program's objectives. Did you take part in PCO or PMO meetings concerning projects associated with the referendum?

Â (1220)

[English]

Hon. David Dingwall: Mr. Chairman, I think all ministers of cabinet participated in debate with regard to the issue. In terms of being privy to subsequent meetings with federal-provincial relations, the PCO, or the Prime Minister's Office, no, I was not aware of that and was not a participant.

[Translation]

Mr. Michel Guimond: In your opinion, were other government members aware of the existence of the national unity fund?

[English]

Hon. David Dingwall: I'm not sure. I don't know what ministers knew or didn't know. It was a budgetary item that was put forward at that time, but in terms of the specifics, I think you would have to ask each minister what he or she knew or didn't know.

[Translation]

Mr. Michel Guimond: Earlier, in response to a question from Mr. Kenney, you acknowledged that the visibility program was created to deal with a particular situation. You seemed to agree with Mr. Guité, who claimed that we were literally “at war” with Quebec separatists. Is that correct?

[English]

Hon. David Dingwall: Mr. Chairman, I don't know if I would characterize it in that way. I think the honourable member is fully aware that at that time in the province of Quebec it was a very serious issue for the federal forces. There were Canadians from coast to coast who wanted to be engaged in the process. There was a lot of speaking that went on in the province of Quebec by a lot of federal representatives of various political persuasions, and of course there were a lot of representations being made by the separatists in the province of Quebec. We were fully engaged in the debate, and yes, I concurred with our objective and responsibility, which was to get the federal message out in the province of Quebec.

[Translation]

Mr. Michel Guimond: Prime Minister Chrétien stated in the House of Commons that several million dollars may have been stolen, but that the fate of the country hung in the balance. Do you agree with that statement?

[English]

Hon. David Dingwall: Mr. Chairman, I was not a member of government at that time. I was not a member responsible for any sponsorship program that may have taken place in 1996 and beyond, so the opinions of the honourable member can be his to choose. It's not for me to choose.

[Translation]

Mr. Michel Guimond: Getting back to Warren Kinsella, your Chief of Staff, during which period did he hold this office?

[English]

Hon. David Dingwall: He was there from 1993 to 1995.

[Translation]

Mr. Michel Guimond: Did he not go on to work in the PMO?

[English]

Hon. David Dingwall: No, I don't think so.

[Translation]

Mr. Michel Guimond: No? When he left your office, where did he go?

[English]

Hon. David Dingwall: I think he went to the private sector. He did work in the office of the leader of the opposition for a period of time, Mr. Chairman, but he went to the private sector.

The Chair: You say the leader of the opposition. Which party are you talking of?

Hon. David Dingwall: Oh, I'm sorry, Mr. Chairman; it was a Freudian slip.

I meant when Mr. Chrétien was the leader of the opposition. He worked there for a period of time, and shortly thereafter, when he left my office, he went to the private sector. I believe he was helpful in terms of subsequent campaigns.

[Translation]

Mr. Michel Guimond: While in your employ, what role did he play in relation to communication projects?

[English]

Hon. David Dingwall: What communication project do you mean?

[Translation]

Mr. Michel Guimond: I'm talking about advertising campaigns and visibility programs.

[English]

Hon. David Dingwall: Mr. Kinsella was the executive assistant. He would report to me various representations we received from members of Parliament and from various stakeholders, and of course he would take information back to those who were requesting the information.

[Translation]

Mr. Michel Guimond: Was he involved in the selection of communication firms?

[English]

Hon. David Dingwall: No.

[Translation]

Mr. Michel Guimond: He wasn't involved? Let me read you an excerpt from a letter dated February 22, 1995 that Mr. Guité wrote to Mr. Kinsella. I'll try to use my best English to read it to you:

Â (1225)

[English]

I am forwarding the Committee's report for your review and concurrence. Should you have any questions regarding the report or the recommendations, I would be pleased to respond to them at any time.

These recommendations should be ratified as soon as possible so that I can advise both the winning and losing firms as to the final decision.

[Translation]

The letter is signed by Charles Guité.

If Mr. Kinsella was not involved in any way in selecting communications firms, why then was Mr. Guité wasting his time writing to Mr. Kinsella? What does it all mean?

[English]

Hon. David Dingwall: No, I'm sure he had a good reason to write. I'd like to see it and review it.

I wouldn't have an answer for the honourable member. We had a process in place where two members from the line department, two members from the private sector, two members from APORS would do the evaluation of the respective bid. The line department would be notified in terms of who was successful. That was the process we used, and that was the process the deputy ministers and senior officials--

[Translation]

Mr. Michel Guimond: Do you admit that this letter contradicts your answer?

[English]

The Chair: Merci, Monsieur Guimond. Your time has expired.

Mr. Tonks, please.

Mr. Alan Tonks (York South—Weston, Lib.): Thank you, Mr. Chairman.

Thank you, Mr. Dingwall, for being here today. I'm sure you would rather be here revisiting under other circumstances.

I think the committee is attempting to match the testimony and the sense of urgency that was established with respect to the checks and balances that you, in your testimony, have put into place. You're taking, as you should, a great deal of credit for those procedural checks and balances. However, I would like the committee to get a sense of why you thought it was so important, when you became the minister, to put those administrative or management controls into place. What was it that tweaked your particular persona such that you thought this was really important?

Hon. David Dingwall: Through you, Mr. Chairman, to Mr. Tonks, I indicated in my opening statement that the issue of advertising, polling, and communications went back many years. It just wasn't one government. It went back many governments.

But you will recall that in my statement I made reference to, for instance, the Federal Court of Canada. There were four applications made by the information commissioner to the Federal Court of Canada against the then-sitting Prime Minister. Four separate applications--in June of 1992, in July of 1992, on June 15 of 1992, and on June 23 of 1992--were made to the Federal Court trying to have released, for the people of Canada, polls that had been taken previously but not released. The Federal Court, in all four instances, unanimously granted the information commissioner the decision, and those polls had to be released.

We took it upon ourselves to make this part and parcel of our policy, that within a reasonable timeframe--60 to 90 days, say--those polling documents would be made available. If memory serves me right, Mr. Chairman, I distributed a wheelbarrow full of polls in June of 1994, indicating that we were serious about providing polls and polling results back to Canadians.

So that was one of the cornerstones that we thought was necessary for the purposes of the new policy, the new guidelines, which cabinet subsequently approved.

Mr. Alan Tonks: Thank you.

I'm sure the committee would agree that if that was the motivation, then the policies that emanated from that were very much in keeping with achieving that policy. However, again to find if there was anything else that motivated you with respect to those policies, I go to the record that there was some concern about the lack of competition with respect to contracts.

There was a front-page article on February 12, 1993, in which Mr. Guité said “I'll tell you for the last time, there is no written report”, with respect to competition. “End of discussion on that issue.” He also confirmed that Treasury Board policy was not followed in this instance because “The policy is a guideline. It's not a rule. We change the guidelines to fit the situation... (It's) not the first time it's been done and not the last time it will be done either.”That was in 1993, and rather prophetic.

There was another article with respect to that period of time, in the Ottawa Citizen on May 7, 1994:

Over the past 15 years, few areas of the federal bureaucracy have been more defiled by political meddling than the relatively tiny agency called the Advertising Management Group. With a staff of only a dozen public servants, the AMG holds the reins on the entire giant cash-cow of government ad contracts.

Would you be aware at the time that there were those kinds of articles, and would that be the kind of thing that you'd be motivated to attempt to bring some policy review on?

Â (1230)

Hon. David Dingwall: Mr. Chairman, to Mr. Tonks, the answer is yes. There are many, many statements that were made on the floor of the House of Commons prior to 1993 about the lack of competition for advertising, communication, and polling. We attempted, through the guidelines, to put a new process in place where there would be competition.

As part of those guidelines going forward, there was a major component that required us at Public Works and Government Services Canada to report on a quarterly basis to Treasury Board on the number of contracts, the competition, the successful bidders, the money that was allotted, the nature of the competition.... It was all provided to Treasury Board on a regular basis from 1993 to 1996 while I was the minister responsible.

But getting back to the substance of your comments, yes, there was incident after incident after incident, but it went back more than just one government.

Mr. Alan Tonks: Then, Mr. Dingwall--through you, Mr. Chairman--can you appreciate the frustration of the committee? It was so much top-of-mind that we brought in policies, and policies with respect to your guideline 4: that contracts for services must be open to competitive bidding; that “furthermore, no one company or agency was to be awarded excessive amounts of government business”; that Public Works “was to be the sole contracting authority for advertising and public opinion research...and was also to monitor and report to Treasury Board on a quarterly basis on contracting activities...”.

Can you not feel the frustration that, if it was so top-of-mind and those were the guidelines, the auditor's report, both the first and second auditor reports of 1996, said and agreed with Mr. Cutler that they weren't being done? Do you find it at least not a little bit teasing that members of the committee would want to ask you, since you were so engaged in it, why you didn't respond, why in terms of oversight something wouldn't have clicked, somebody wouldn't have come to you, especially with Madame Marleau saying that Mr. Guité came to her the first meeting and said “I report to the minister”?

So do you not feel a little bit of the frustration of the committee on that?

Hon. David Dingwall: Oh yes, Mr. Chairman, I can well understand the frustrations of members of Parliament. Some have suggested that people in positions of responsibility knew what was taking place and didn't do anything about it.

All I can attest to, Mr. Tonks, is that the evidence you had before this committee came from a secret document. I wasn't aware of that, and didn't become aware until the complainant actually made a complaint in mid-1996. The deputy wasn't aware; the ADM wasn't aware; the internal auditor wasn't aware. We had received no complaints from the line departments. We had received no complaints from Treasury Board. There were no complaints from the polling and research organizations, the advertising institute, their various associations. No one came forward with a complaint, so it was very difficult for me, as a minister in a position of responsibility, when no one came forward with those suggestions or with those reports. So I understand your frustration.

Â (1235)

The Chair: Thank you very much, Mr. Tonks.

Before we move to Madame Jennings, Mr. Guimond, you were reading from a letter during your intervention. Are you able to table that letter with the committee so that it's public?

[Translation]

Mr. Michel Guimond: I'll gladly do so, Mr. Chairman.

[English]

The Chair: Okay, give a copy to the clerk. That letter is being tabled and will be public.

Madame Jennings, for eight minutes.

[Translation]

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Thank you, Mr. Chairman.

[English]

Thank you very much, Mr. Dingwall.

Your testimony has made it clear that prior to the federal election in 1993, there were no guidelines and no rules governing contracting out, advertising, or communication services. You've just confirmed to Mr. Tonks that you were aware that there were all kinds of contracts for public opinion research, etc., going to federal friendly—or at the time, Tory friendly—advertising and communications companies. You stated that it even went beyond the previous Tory government, and was a situation that had existed for quite some time.

In all of the news coverage I have seen dating back to that time—and Mr. Tonks has read out some quotes from some of them—Mr. Guité, director of the advertising and public opinion research section of the Department of Supply and Services, figures front-row centre in a lot of the articles. He was very open, saying, “We change the guidelines to fit the situation... (It's) not the first time it's been done and not the last time it will be done either.”

Seeing these articles now, and knowing that one of the planks of our party was that we were going to remove those kinds of in-house, incestuous relationships and put into place guidelines that were transparent for competitions, etc., I would have to assume, as a reasonable person, that the name Guité would have rung a bell.

My question is—and I'm sure most reasonable Canadians watching this entire process are asking—“If Mr. Guité was front and centre under the Tories, and newspapers or journalists were able to uncover these kinds of scandals, how is it that no effort was made to remove him from any authority over the advertising and public opinion research sector when we came into power?”

I wasn't there until 1997, but when the Liberal Party of Canada came to power in 1993, and you brought in those guidelines and rules for the first time, how is it that the assistant deputy minister that he normally would have reported to didn't move him out? How come the deputy minister didn't move this guy out? How come he not only remained there, but also received promotions subsequent to your moving on to another portfolio? He actually received promotions—from director all the way up to assistant deputy minister.

That's a main thing that people would like to know. He's a central figure. You can pull out newspapers going back to 1993 that have his name or fingerprints all over them, and yet he remained in place, with the authority to implement new guidelines. The allegations in the secret document from Mr. Cutler, which you talk about, only became public to the assistant deputy minister in 1996, towards the end of your term as minister responsible. Yet it was clear that Mr. Guité had no interest whatsoever in applying those rules and guidelines that you brought into force.

Hon. David Dingwall: Mr. Chairman, very briefly, the honourable member is quite right. The situation that existed prior to 1993 went back even before that government. It wasn't just the previous government, but was a situation that went back to the eighties, and probably into the seventies.

Secondly, you're quite right, there were no rules and there were no guidelines, and we tried to provide some guidelines and some transparency to the situation.

With regard to the individual in question, that is not a responsibility, nor should it be a function, of a minister. That is a function of the senior echelon of the department or agency, and of the Public Service Commission. Ministers cannot and should not get involved in saying you can't have this person; you've got to have this person. That's just not a function a minister should take on. It's certainly not a function I was a part of.

Â (1240)

Mrs. Marlene Jennings: I'd like to interrupt you for a moment. I can understand that a minister, under the traditional definition of ministerial responsibility and accountability, is not responsible for hiring and firing within the public service. I understand that fully. But if someone is appointed to cabinet and is given a portfolio and already knows—it's public knowledge, it's public notoriety—that there's a particular public servant who has said publicly, “Guidelines? Rules? They're there to be broken—we apply them to the situation as we see fit”, I would have thought the minister would have told his deputy minister, “You may not be able to fire the person, but I expect that extra control and supervision is going to be given to that individual to ensure he or she respects the rules and guidelines I bring in, that I got cabinet to approve and then Treasury Board to adopt and then sent down the line.”

Hon. David Dingwall: Mr. Chairman, through you to the honourable member, in 1993, as a new minister, I was given the portfolio with all its bells and whistles, so to speak. Mr. Guité was a public servant. I had full confidence in my deputy minister. We didn't particularly go out to check the records of various public servants concerning what they did or didn't do. That's not a function of a minister of the crown.

Mrs. Marlene Jennings: Do I still have time?

The Chair: You have a minute and a half.

Mrs. Marlene Jennings: Then it is a function of the senior public servants in place, in that case. If you say it's not your responsibility as a minister, when it's an individual who enjoys public notoriety for bending rules and ignoring rules and guidelines, even to tell the deputy minister, “You may wish to watch out, because this person, according to the published reports, has a history”.... If it's not your responsibility as a minister, then obviously you're saying it's the deputy minister's responsibility.

Hon. David Dingwall: Mr. Chairman, in fairness, you will have an opportunity in terms of due process to speak to the individual in question. I have to tell you that as the minister responsible for Public Works and Government Services, this certainly was not presented to me. He may have worked for previous governments in the past, but there was no notoriety associated with this individual in terms of doing things he ought not to have been doing. In point of fact, for all we knew at the time he was a good public servant, and we had to deal with who we had there at the time reporting to the ADM and to the deputy minister.

Mrs. Marlene Jennings: Mr. Chair, I've quoted from a series of articles that appeared in either the Ottawa Citizen or from the Canadian Press, etc., back in 1993, so I'd like to table a copy.

The Chair: Okay, they can be considered tabled and distributed.

Thank you very much, Ms. Jennings.

Mr. Hill, please; you have eight minutes.

Mr. Jay Hill (Prince George—Peace River, CPC): Thank you, Mr. Chairman.

I want to pick up where the other members left off, Mr. Dingwall. Mr. Guité indicated to your successor, Diane Marleau, that it was normal practice for him to report directly to the minister. Was that not the practice when you were minister for that department?

Hon. David Dingwall: No, Mr. Chairman.

Mr. Jay Hill: You indicated in the opening round of questioning to Mr. Guimond that you could not recall, given the length of time, how often you might have met with Mr. Guité. Is that accurate?

Â (1245)

Hon. David Dingwall: I think that's fair, yes.

Mr. Jay Hill: Did you ever meet with him just one-on-one? Something like that should stick in your mind.

Hon. David Dingwall: Why?

Mr. Jay Hill: Because I would suggest to you it wouldn't be normal practice for somebody that far down the hierarchy to meet one-on-one with the minister unless he had something pretty important to impart.

Hon. David Dingwall: All ministers of the crown, I am sure, from time to time would have met different officials at different levels, particularly if they had differing expertise.

Mr. Jay Hill: No, I'm asking a specific question. Did you, to the best of your recollection, ever meet one-on-one with Mr. Guité?

Hon. David Dingwall: No, I don't believe I did. I don't recall that, to the best of my knowledge.

Now, could there have been a situation where we were standing at a stakeholders' meeting or in the department, where words were exchanged? I don't know, Mr. Chairman.

Mr. Jay Hill: Okay, so you don't recall ever meeting one-on-one with him.

Given these guidelines that you instituted to try to protect the public purse, presumably, how is it possible that this scandal could even have happened if the departments had followed your guidelines?

Hon. David Dingwall: Well, I think this is part of the process that the committee is undertaking. You're hearing--

Mr. Jay Hill: But you were bragging about these guidelines.

Hon. David Dingwall: Yes. I wouldn't call it bragging, Mr. Chairman. I would say they were new guidelines, new policy that we put in place. We didn't receive--

Mr. Jay Hill: But what good are the guidelines if the minister responsible is kept in the dark, as you say you were?

Hon. David Dingwall: You can choose your words to say that, but when you don't receive complaints from Treasury Board, you don't receive complaints from the PCO, the advertising agencies are not complaining, the public opinion research firms are not complaining, the communication companies are not complaining, their respective associations are not complaining, you have no evidence coming forth within your department, and you find out eight, nine, ten years after the fact that someone had a secret diary, then it's kind of hard for a minister of the day to say there have to be problems there.

Mr. Jay Hill: You just used the words “find out eight, nine, ten years after the fact”. Earlier you said in reply to a question from the other side that you were aware mid-1996, just following your transfer to a different department, of Mr. Cutler's complaints. Now you're saying “eight, nine, ten years after the fact”. Do you recall the name of Mr. Cutler before--

Hon. David Dingwall: Mr. Chairman, I may have misspoken, but I don't think I have. I want to be clear, in regard to the audit that took place in 1996 by Ernst & Young, that I was not asked, I was not consulted, I was not interviewed. I didn't know it took place. I was not aware of a complaint from Mr. Cutler whatsoever. I became aware of all of this issue with the testimony that has been provided to this committee.

The Chair: Thank you, Mr. Dingwall.

Mr. Hill, please.

Mr. Jay Hill: Thank you, Mr. Chairman.

At the time that you were Minister of Public Works, did you know Mr. Cutler?

Hon. David Dingwall: No, Mr. Chairman.

Mr. Jay Hill: Did you ever meet with him?

Hon. David Dingwall: No, Mr. Chairman.

Mr. Jay Hill: You're certain of that, but you're not certain whether you met individually with Mr. Guité?

Hon. David Dingwall: Well, I'm certain of Mr. Cutler because he's an employee of the Department of Public Works. I think if I had met him and he had come forward with a complaint--

Mr. Jay Hill: Well, who is Mr. Guité? I thought he was an employee as well.

Hon. David Dingwall: Yes, but you're suggesting--and I'm responding--that had Mr. Cutler come forward with the evidence that he gave to you in committee, I would have had a responsibility to act, and that's why I would have remembered him.

Mr. Jay Hill: But you don't remember him at all, whether he came forward or not? I'm not suggesting that you'd only remember him under one scenario, I'm asking did you ever meet with him?

Hon. David Dingwall: Not to my knowledge, Mr. Chairman.

Mr. Jay Hill: Okay.

You indicated earlier in your testimony that Mr. Chrétien, in I think you said November 1993, immediately after assuming office for the first time, collapsed the cabinet committee responsible for overseeing communications. Is that accurate?

Â (1250)

Hon. David Dingwall: That's my understanding.

Mr. Jay Hill: Why would he do that?

Hon. David Dingwall: To try to save costs, the re-engineering of a new government. A lot of decisions are taken by prime ministers and by privy council offices on how the organization of the government will take place.

Mr. Jay Hill: Was the intent to replace that oversight by the cabinet committee with these guidelines that you were instructed to draw up?

Hon. David Dingwall: I couldn't answer that, Mr. Chairman. I can't tell you what the Prime Minister was thinking at the time, or the Clerk of the Privy Council.

Mr. Jay Hill: How much time have I left?

The Chair: Just one minute and 45 seconds.

Mr. Jay Hill: Are these guidelines still in place and governing the awarding of contracts at the Canadian Mint?

Hon. David Dingwall: The Canadian Mint is a crown corporation.

Mr. Jay Hill: You said earlier that you were responsible for crown corporations as well when you were Minister of Public Works.

Hon. David Dingwall: Yes.

Mr. Jay Hill: Are the guidelines in place for them as well?

Hon. David Dingwall: I would have to go back and check, Mr. Chairman, in terms of crown corporations being separate and apart from departments, which is well known by most public servants and individuals who deal with various crown corporations.

Mr. Jay Hill: Are you aware, in your role as the head of the Canadian Mint, whether there are any existing advertising contracts between the Canadian Mint and Lafleur or Groupaction or Groupe Everest, or any or the others that have received such notoriety due to this scandal?

Hon. David Dingwall: Mr. Chairman, I can only recall what has happened in the last--

Mr. Alan Tonks: Mr. Chairman, on a point of order, if I may?

The Chair: Mr. Tonks, on a point of order.

Mr. Alan Tonks: Mr. Chairman, I thought that our operating assumptions were questions within the context of chapters 3, 4, and 5 of the auditor's report. I think that asking questions with respect to the Mint, in the context that the questions are asked, is outside those chapters.

The Chair: Unless the member can show relevance with the Mint to the investigation, that is correct. Mr. Dingwall is not here to answer questions on his current employment. He is here to answer questions on the sponsorship investigation.

If the member has a relationship or relevance to the time, he can demonstrate that and continue on.

Mr. Jay Hill: Mr. Chairman, I appreciate that and I appreciate the point of order.

What I was endeavouring to get at is that the witness has stated—I used the term “bragging about”. I admit that was my term, not the witness', but he seemed quite proud of the fact that he had brought in these guidelines during his short tenure as Minister of Public Works. It has been clearly shown that the guidelines don't work. I was wondering whether they are still in place for crown corporations like the Canadian Mint. Obviously, in the overall thrust of trying to protect tax dollars from being wasted, that would be relevant, I would hope.

Hon. David Dingwall: I--

The Chair: If you put the rules in place, Mr. Dingwall, as the minister, now that you're on the other side of the fence, are you living by the rules that you put in place?

Hon. David Dingwall: Yes, Mr. Chairman.

For the benefit of members, the Auditor General in her recent report said “We also audited transactions involving...the Royal Canadian Mint. ...we noted no significant observations to report to Parliament.” It's in chapter 3 of her study.

The Chair: Thank you very much, Mr. Hill.

Mr. Lastewka, please, eight minutes.

Hon. Walt Lastewka: Thank you very much, Mr. Chair.

Mr. Dingwall, I'd like to go over some of the procedures, starting from the fact that you talked about complaints in the 1970s and 1980s. There were four complaints.

When you took over the responsibility of merging the two departments, you put in the guidelines. You mentioned that the client departments, the ad firms, and the ad firm associations had not complained to you about the guidelines.

Did you hear complaints from within the department about the guidelines?

Hon. David Dingwall: No, Mr. Chairman.

Â (1255)

Hon. Walt Lastewka: When you merged the department, did you request internal audits? Did you follow up on any of the problems or difficulties in the merger?

Hon. David Dingwall: Mr. Chairman, I want to be clear. The minister does not merge departments. This is a decision by the Prime Minister and the Clerk of the Privy Council. They made the decision to combine Public Works and Supply and Services. It is the deputy who manages that merger.

I think I made reference in my comments that it was a pretty hectic time. We were downsizing, $350 million had to be cut, and 40% of the employees took early retirement. It was a difficult time for him, for public officials, and for the minister, as we tried to get our financial house in order across the government.

Hon. Walt Lastewka: As minister for the new department, that must have been in your mandate.

Hon. David Dingwall: Oh, yes, that was in my mandate. The deputy and other senior officials would advise you on a fairly regular basis, in terms of some of the difficulties within the department that required either a policy change, an amendment, or what have you.

Hon. Walt Lastewka: But were you not involved in briefings that reviewed the merger to make sure these two departments were being put together properly and that there would be some type of audit or some type of mechanism to double-check that the merger was going properly?

Hon. David Dingwall: Mr. Chairman, I'm just trying to recall. If there was an urgent issue the deputy thought the minister had to know about, I'm sure he would have informed me. But as I understand it, the deputy minister had an executive committee. They would meet on a fairly regular basis to discuss issues on the management of the various aspects of the department. They would determine, if you will, the risk the department had to confront, the action plans they were to undertake, and the various forms of audits the department was going to take for the year going forward. I think that was their normal process of operations.

I would not be a member of those regular briefing sessions. I would be briefed on substantive issues that transcended those operational things. So on one hand, yes, I would be familiar with the merging of some of the problems, but in terms of the plumbing and the fixing of the plumbing, that would be done by the deputy and his appropriate executive committee.

Hon. Walt Lastewka: Some of us have already asked the question about why Mr. Guité would decide, when Ms. Marleau arrived on the scene, that he would go to her to basically tell her he reported to her. On the other hand, you're telling us that during your reign as minister he did not report to you. That is correct?

Hon. David Dingwall: That's correct.

Hon. Walt Lastewka: So you did not have discussions with him on a direct, one-to-one basis. From what I understood you to say, in a briefing he might have been one of the people in the audience, but he would not have directly given briefings to you. I want to make sure you're clear on that, because I--

Hon. David Dingwall: Yes, sir. Just so we're clear, let me quote what Mr. Quail said in testimony on the reporting relationship: “The reporting relationship did change during the tenure. Before 1997 the reporting responsibility for Mr. Guité was to an ADM of government operational services.”

On the broader questions of whether I met with Mr. Guité and how many times I met with Mr. Guité, I don't recall. I would have met with Mr. Guité as the issue would have warranted and as the times would have made necessary, but I can't recall. It was 10 or 11 years ago, I was a new minister with a whole bunch of responsibilities, and I don't recall.

Hon. Walt Lastewka: Did you have any experiences where the PMO or the PCO might have been dealing with the guideline changes?

Hon. David Dingwall: Not to my knowledge. I think I would have known about that or found out about that if it was taking place.

Hon. Walt Lastewka: Were you questioned by the PMO or the PCO on guideline changes your deputy minister had implemented in the department?

Hon. David Dingwall: Well, let's go back a step. In April 1994 the full cabinet approved the guidelines and directed Treasury Board to work with Public Works and PCO to put the procedures in place in terms of the subsequent amendments that would have to take place on communication policy, on contracting policy, and on a holding policy for information. So by that implication, ministers of the crown and deputy ministers would have known of the new guidelines, plus all of the central agencies, including the PCO and the PMO as well as Treasury Board.

· (1300)

Hon. Walt Lastewka: Can you go back to the four complaints you outlined earlier? You did mention that your guidelines that were approved by cabinet were new guidelines. Could you give us the gist of the four complaints?

Hon. David Dingwall: If I understand the question correctly, there were four applications made to the Federal Court of Canada against the Prime Minister of the day in terms of getting access to information vis-à-vis public opinion polls. The Government of Canada had paid for those results but they were not releasing them. They were claiming that it was privileged information.

There was an adjudication by the Federal Court of Canada. The Federal Court of Canada ruled on the four applications and awarded the information commissioner the right to have access to that polling data. That became a cornerstone, if you will, of the subsequent deliberations and makeup of the new policy that went forward.

With regard to those applications, if I may, Mr. Chairman, just very briefly, one was dated June 15, 1992, by the information commissioner against the Prime Minister of Canada. Another one was dated July 22 by the information commissioner against the Prime Minister of Canada. The third one, June 23, was by a citizen against the Prime Minister and the Privy Council Office. The fourth application was by a gentleman against the Clerk of the Privy Council for a review of this particular policy.

The Chair: Thank you very much, Mr. Lastewka.

It's now just around one o'clock. We're going to break for 45 minutes. I think that will be sufficient.

Lunch is served for members and staff. We'll reconvene at 1:45.

The meeting is suspended.

· (1302)

· (1354)

The Chair: Good afternoon, folks. We're reconvening.

Mr. Thibault has given me notice of a point of order.

Mr. Thibault.

· (1355)

Hon. Robert Thibault: Thank you, Mr. Chairman.

It pains me to bring this point, but I think it's important that all of us consider it and that we all consider our roles and responsibilities here. We have a very difficult task that we must be diligent at, and we must be patient. We have to hear from a lot of witnesses who come here. We can all have different political and personal views on the witnesses and on the testimony presented. I think I, as well as everybody, should be careful in the interim process about how we express our personal opinions of these witnesses and the testimony.

I have a report that the chair in an interview—and I won't imply a motive—perhaps called into question the credibility or believability of the testimony of our current witness.

I think we should all use caution—all of us, the chair included, and perhaps more importantly the chair because he has the very difficult role of making sure these proceedings are transparent and that they appear, and are, unbiased.

I raise that as a point, Mr. Chair, as a caution to yourself and to all of us.

The Chair: Thank you very much, Mr. Thibault. As a caution to all of us to continue this investigation as thoughtfully and as diligently as we can, it is important.

As I mentioned to you when you discussed this issue with me, we all have to deal with the media and communicate to Canadians what our perceptions are. Of course that also extends to the Prime Minister, who has been quite vocal in his opinions of the chair of this committee as well. These are, as we all know, the push and pull of Parliament and the political process at work. Mr. Dingwall, of course, is fully familiar with it himself, having participated for quite some number of years.

So your point is noted.

Moving back to the interventions, we'll go to Mr. Proulx, s'il vous plaît, for eight minutes.

[Translation]

Mr. Marcel Proulx (Hull—Aylmer): Thank you, Mr. Chairman.

Good day, Mr. Dingwall. In your opening remarks, you stated that from August 1993 to July 1995, Mr. Guité reported to the Deputy Minister through the Assistant Deputy Minister for Corporate Services. Subsequently, from August 1995 to the remainder of your time at PWGSC, Mr. Guité reported to the Deputy Minister through the ADM for Government Operational Services.

Do you recall the names of these two individuals, Mr. Dingwall?

[English]

Hon. David Dingwall: Corporate services was Mr. Neville, I think, followed by Mr. Stobbe.

Mr. Marcel Proulx: I'm sorry, the sound was off.

Hon. David Dingwall: It was Mr. Neville; then I think it was Mr. Stobbe.

[Translation]

Mr. Marcel Proulx: Thank you. Mr. Dingwall, are you acquainted with Mr. Pierre Tremblay?

[English]

Hon. David Dingwall: Yes.

[Translation]

Mr. Marcel Proulx: Did Mr. Tremblay work for you when you were Minister of Public Works?

[English]

Hon. David Dingwall: As Minister of Public Works and Government Services--

Mr. Marcel Proulx: Why aren't we getting sound, Mr. Chair?

The Chair: I'm not getting much sound. It's a technical problem.

I think it has been resolved. Please continue.

Hon. David Dingwall: No, Mr. Chairman, he did not work for me in my capacity as minister.

[Translation]

Mr. Marcel Proulx: Mr. Dingwall, Allan Cutler told this committee that at the November 17, 1994 meeting, Pierre Tremblay allegedly said that you would not oppose requests for changes in decisions coming most likely from Mr. Guité.

Did Pierre Tremblay have any kind of influence over you or some special ties to you, even though he was not your employee? Was is in his power to convince you to change the rules of the game?

¸ (1400)

[English]

Hon. David Dingwall: No, Mr. Chairman.

[Translation]

Mr. Marcel Proulx: Am I to understand then that when Mr. Cutler was alleging that Mr. Tremblay wielded some kind of influence over you, he was lying or was confused about the dates? Did Mr. Tremblay influence your decisions regarding this matter in any way, Mr. Dingwall?

[English]

Hon. David Dingwall: Mr. Chairman, I was not privy to what discussions took place between employee A and employee B. I read the testimony, as you all did, of the diary that was kept. What I said in my opening statement was that this was a recorded decision of full cabinet directing the Treasury Board, Public Works, and the Privy Council Office to complete the necessary contracting guidelines and various amendments.

For me to change that I'd have to get a sign-off by the deputy, the ADM; get a written report from the people who were reporting to the ADM; put it on cabinet as notice; circulate it to ministers; and then have cabinet amend the decision. Granted this was nine or ten years ago, but I think I would recall that conversation or discussion taking place.

That's why I said what I said in my opening statement.

[Translation]

Mr. Marcel Proulx: Mr. Dingwall, are you acquainted with Jean Carle?

[English]

Hon. David Dingwall: Yes.

[Translation]

Mr. Marcel Proulx: Do you know if in fact Jean Carle is the person who arranged for Mr. Guité to keep his job when the Liberal Party came to power and succeeded the Conservative government?

[English]

Hon. David Dingwall: No, Mr. Chairman, I was not aware of that.

[Translation]

Mr. Marcel Proulx: Shortly after Mr. Guité was confirmed in his position, according to his testimony and to the testimony provided by a former employee, Ms. Tremblay, the rules that you described to us this morning were changed. Rather, I would say that the rules were bent. Are you aware of any request that might have been made to have the rules changed, or that someone in the department might have agreed to change or bend the rules in favour of Mr. Guité and his team?

[English]

Hon. David Dingwall: No, Mr. Chairman, I'm not aware of anything in that regard. As I'm sure the honourable member knows, Treasury Board would have had a major role to play if there were any changes whatsoever.

[Translation]

Mr. Marcel Proulx: On March 1 last, former Deputy Minister of Public Works Janice Cochrane told the committee during her testimony that an audit had been conducted by the firm of Kroll Lindquist Avey and that a report had been submitted to the department in 2003. The report identified irregularities such as non compliance with section 34 of the Financial Administration Act, invoices approved outside the contract period, fees paid in a manner not in accordance with the contract, invoices approved where deliverables did not appear to have been met, to name only a few.

In my view, this list illustrates the most basic lack of respect for the rules that you had put in place and that office holders are bound to uphold. Apparently, these irregularities occurred during the referendum period, that is when you were the Minister. How do you explain that fact, and how are we to understand that irregularities on this scale were allowed to occur in a department, when there are all kinds of ways of conducting audits? It seems that a group of 10 or 12 employees in this unit ruled the roost and did as they pleased.

¸ (1405)

[English]

Hon. David Dingwall: Mr. Chairman, the honourable member makes reference to an audit in 2003. I'm sure he's fully aware that I've been out of government now for well over seven years.

In terms of the breach of the Financial Administration Act, that would have been a very serious breach, and I would have thought the appropriate authorities within the respective departments would take the necessary action in accordance with any breaches of that act.

The broader question is, was I aware of any breaches of the Financial Administration Act during my time? No, I was not aware of any breaches of the Financial Administration Act.

The Chair: Thank you, Mr. Dingwall.

I should have mentioned when we reconvened, of course, that we'll be bringing forth our forensic auditor at 3:30 p.m. for a report to the committee. So we'll be wrapping up Mr. Dingwall's testimony at that time.

Mr. Keddy, please.

Hon. David Dingwall: Mr. Chairman, before Mr. Keddy speaks....

The clerk gave me a piece of paper in terms of my cabinet confidences.

The Chair: That's the order in council relieving you of your oath of confidentiality pertaining to chapters 3, 4, and 5 of the Auditor General's--

Hon. David Dingwall: And the timeframe for that is from when to when?

Mr. Vic Toews (Provencher, CPC): It's from now to eternity.

The Chair: Once you divulge a confidence, I guess it's always divulged. But that's the order in council right there.

I think it was from 1993 to 2003 or 2004.

Madame Jennings, do you--

Hon. David Dingwall: Mr. Chairman, I know you're a stickler for time, and I apologize--

The Chair: No, if you want to absorb that, take a second before Mr. Keddy's time.

Hon. David Dingwall: It seems to read here, Mr. Chairman--if I may, just for the clarification--that “the confidences of the Queen's Privy Council for Canada, as defined in section 39 of the Canada Evidence Act, in existence since July 1996 until the date of the making of this Order in Council...”, which is February 19, 2004.

That's what it says, Mr. Chairman. If I'm incorrect, please let me know.

The Chair: Just one moment until we get the law clerk on this.

Madam Jennings, did you have something to say?

Mrs. Marlene Jennings: It was just to make the point that on the Auditor General's report on the advertising, sponsorship, and opinion research, I had previously put on record sections of her report where she went back to the advertising and public opinion research section headed by Mr. Guité in which she underlines that there were similar problems all the way back to 1994.

So in terms of the waiver by the Privy Council, by the Prime Minister, for ministers and former ministers, if it is not clear, then the committee should go back and ask that it be made clear and that it be brought back to 1994.

The Chair: Okay, let's ask our law clerk to tell us what we have.

Mr. Rob Walsh: Mr. Chairman, I believe the section read to the committee by the witness is with reference to the definition in section 39 of the Canada Evidence Act. That definition has been in place since July 1996 and is not meant to present a restriction on the matters that can be spoken to by a witness.

The Chair: Are you comfortable with that, Mr. Dingwall, so that you don't feel inhibited by that particular text, so that you can speak freely on your term as the Minister of Public Works?

¸ (1410)

Hon. David Dingwall: To the best of my recollection. And I presume that legal counsel, knowing him for many years, is accurate in his assessment as to what the order in council states.

The Chair: Thank you.

Mr. Keddy, eight minutes.

Hon. David Dingwall: Perhaps I could have my order in council back.

The Chair: Keep it for reference in case you're questioned.

Mr. Keddy, eight minutes, please.

Mr. Gerald Keddy: Thank you, Mr. Chair, and through you to our witness.

There's still a bit of a puzzle here. I appreciate the former minister stepping up to the plate and saying his testimony will be relevant on issues that concern him as a minister. My original question, and my original line of questioning, was a direct request to you, sir, to release Mr. Guité from any responsibility to yourself as a minister of the crown.

I just want to go back and read a statement from Mr. Guité from the evidence he gave. He said:

I will decline today to answer any question that relates to discussions that I may have had with ministers. It will require ministerial authorization for me to disclose any discussions I've had with ministers prior to answering any questions that will deal with discussions with ministers.

You are the former minister in front of us today. I think it's extremely imperative to this committee that you make a decision and tell us clearly whether you would release Mr. Guité from any ministerial responsibility; that when he appears before this committee he can speak freely on discussions he had with you, without interfering with any ministerial privilege.

Hon. David Dingwall: Mr. Chairman, so be it. If Mr. Guité wishes to do that, it would be fine with me as the minister.

The only thing I flag for committee members is the cabinet confidences. My interpretation might be a little different from that of the law clerk, but I have no difficulty whatsoever with Mr. Guité appearing before this committee, giving testimony in this committee, and talking about what may have transpired while I was the minister. I hope that's helpful.

Mr. Gerald Keddy: Thank you very much for making that clear. It was not clear this morning, and it's absolutely clear now.

I have a couple of other questions, and maybe we could clarify this point. There's still a lot of confusion over whether or not you met with Guité. In your original testimony you said you didn't think you had ever met with Guité. Then you came back later in testimony this morning and said that perhaps you had met with Guité at some time.

Guité states that he met with you many times, so can you clarify that? Did you or did you not meet with Guité in your capacity as Minister of Public Works?

Hon. David Dingwall: Perhaps the witness could share that testimony with me. I didn't read that in the testimony as such. My comment earlier this morning was that I met with officials as the issues deemed it. The same would have applied for Mr. Guité. I can't recall who I met with and who I didn't meet with eight, nine, or ten years ago in the Department of Public Works and Government Services.

Mr. Gerald Keddy: Very good.

You made another comment earlier that I find to be extremely troublesome and actually truly misleading to the committee and to the public at large. You said there were absolutely no rules in place when you became Minister of Public Works. There was nothing in place.

You absolutely must know that all dealings of cabinet, all dealings of ministers of the crown, and all dealings of the bureaucracy are strictly controlled by the Financial Administration Act and the contracts act. Clearly there were rules in place, and if those rules or guidelines weren't being followed, I think it's exceptionally misleading to try to tell Canadians there were no rules in place in 1994.

Hon. David Dingwall: The guidelines we put in place were the first ever of the federal government and the first ever for a provincial government. They resulted in the amendment of the communication policy, the contracting policy, and the holding policy of the Government of Canada. They were new guidelines, new policy, and had not existed before that.

The honourable member is quite right in referring to the Financial Administration Act. The Financial Administration Act is a framework for all government departments. What we put in place was a specific set of guidelines and a policy on advertising, polling, and communication--the first ever. I wish the honourable member would acknowledge that it was the first time that had ever happened.

¸ (1415)

Mr. Gerald Keddy: And I wish, sir, that you would acknowledge that the Financial Administration Act and the contract act were there before any other guidelines were put into place. Those acts clearly defined your role as a minister.

My next question is on sponsorships. You stated that there were no sponsorships. Perhaps there were no sponsorships as we understood them under the sponsorship agreement of 1997, but what about the contracts that were issued during the referendum in 1995? They were absolutely the basis.... Their selection, under your watch and Mr. Guité's watch, was the early basis for the whole sponsorship scam. So where did those contracts come from?

Hon. David Dingwall: Mr. Chairman, I respectfully disagree with the premise of the honourable member's question. What took place during the referendum in terms of Public Works and Government Services Canada was that money was provided for the purposes of advertising in the province of Quebec.

Mr. Gerald Keddy: I have one other comment, Mr. Chairman, and it will be my final comment. It's been stated that it's not the rules, it's the objectives. I think it is clearly about the rules; this is all about the rules and the fact that the rules were broken. If there were guidelines put in place under your watch in 1994, how did we end up with $250 million of the public's money going missing?

Hon. David Dingwall: There are two points, Mr. Chairman. I was not the minister responsible for the sponsorship program. I had left public life in 1997--involuntarily, but I left public life. Second, I referred to supporting the objective of additional advertising in the province of Quebec, and in the management of that I had complete confidence in my department that rules would be adhered to.

Mr. Gerald Keddy: I have a final question, Mr. Chair. Again, I think it's important for us to hear this in the testimony here today, and I think it's important for the public at large to know the answer to this question.

To Mr. Dingwall through the chair, did you speak to any member of Parliament or their staff prior to appearing here today on this specific issue?

Hon. David Dingwall: No, Mr. Chairman. I speak to members of Parliament quite often. I spoke to the chairman; we sat on a plane together, but we didn't speak about this. I spoke to my colleague here on the right. I asked him a question about what was happening in the province of Quebec. I spoke to Mr. Mills in terms of a greeting. But no, Mr. Chairman.

Mr. Gerald Keddy: Thank you.

The Chair: Thank you, Mr. Keddy.

Mr. Tonks, please, for eight minutes.

Mr. Alan Tonks: Mr. Chairman, Mr. Mills is going to take my spot, if that's okay.

The Chair: Mr. Mills.

Mr. Dennis Mills: Thank you, Mr. Chair.

Mr. Dingwall, I'd like to quote from the Auditor General's report. It's from chapter 3, page 5, paragraph 3.14, under “Observations”:

When it created the Sponsorship Program, the federal government did not inform Parliament of the program's real objectives; nor has it ever reported the results. Former officials of CCSB told us that after the 1995 Quebec referendum, the government wanted to raise its profile in Quebec by sponsoring local events and so it set up the Sponsorship Program. However, we saw no such direction from the government and no formal analysis or strategic plan.

Now, I was around here then, and I certainly realized there was a major exercise to try to save this country from the separatists. We certainly saw the results, as separatism over the next three years was reduced from a high of 49.4% to about 27% or 28%.

But I want to refer to your speech this morning on page 8:

The principles underlined in the new policy were those of openness and accountability through a fair and competitive process. In that way, taxpayers would be in a position to know if they truly received value for their money.

Now, Mr. Dingwall, fair Canadians know this discussion is a fact-finding exercise for us to decide whether or not Canadians received value for their money. The Department of Public Works was very sophisticated throughout time in impact studies and analysis of value for money. I was wondering if you could comment on your understanding of how one would determine value for money or processes that might have been in place under your watch to see that the taxpayer got value for money.

¸ (1420)

Hon. David Dingwall: Mr. Chairman, there are a lot of questions in that intervention.

The Chair: Five minutes.

Hon. David Dingwall: There are several points. The member knows that I was not a part of the sponsorship initiative, which came after I had left Public Works.

In terms of value for money, that is a key principle at Public Works, yes, but more importantly at Treasury Board. It's not always the lowest bid. It's not always the one that can deliver the service the most quickly. It would comprise those two elements, but also the quality of the service and the significance of the request that is being made.

Yes, a lot of impact studies would have been done over the years on a variety of programs to ensure that the crown is getting value for its money.

On contracting, that would also involve, of course, Treasury Board because they are the ones who monitor the compliance and make sure the rules are adhered to. They would be asking the respective line departments, I would think, on whatever the expenditure would be, whether in fact they had value for their money.

That's a bit of the history and a few of the nuances associated with that.

Mr. Dennis Mills: Thank you.

I'll give Mr. Tonks the balance of my time.

The Chair: Mr. Tonks, go ahead.

Mr. Alan Tonks: Thank you, Mr. Chairman.

Mine is a short question, Mr. Dingwall. In trying to ascertain when things went off the track, and in looking at important thresholds as to when that may have occurred, what this committee is really all about is to try to find out what went wrong.

In the contracting policies that were laid out, on page 7 you noted there was to be a report to the Treasury Board on a quarterly basis on contracting activity. You also noted on page 6—and I think I've pointed this out before—that all contracts worth $30,000 or more were to be publicly tendered, and no one company or agency was to be awarded excessive amounts of government business.

Mr. Harder, who came before us, had indicated.... I know this is slightly after your time, but the committee would be interested to know how you would have responded to the fact that on September 19 Treasury Board waived those provisions for the contracts on September 19, 1996.

Treasury Board approved the cancellation of appendix Q, reporting requirements to the treasury.

The Secretariat has concluded that, because of the high level of competition of public opinion research and advertising contracts, the reporting requirement should be removed. ... Public Works and Government Services Canada, however, would continue to monitor its contracts for these services and ensure that high levels of competition continue, and that no one company dominates the market.

When you were in cabinet, do you recall that issue being dealt with by the Secretary of the Treasury Board? If you did acknowledge that at the time, would you have taken great exception, in view of the very policies you had put in and the reasons for which you had put them in?

¸ (1425)

Hon. David Dingwall: Mr. Chairman, the member is correct that in September of 1996 the responsibility was removed. I think that was the evidence that was given by the former deputy minister of the Treasury Board.

I think I said earlier in my testimony that it was one of the checks and balances that we had made part and parcel of our program in going forward, not only the reporting but also the listing of the contracts. Where an amount was found to be somewhat excessive, there would have to be an explanation.

To your specific question, I was no longer a member of Treasury Board on January 15, 1996. That matter certainly wouldn't have come to my attention, but I would have asked a lot of questions as to why if I had been there, Mr. Chairman.

I think the secretary, when he was here, indicated that the regular reporting that had been going on clearly indicated there was a lot of competition for the various bids that were taking place. They were exercising that and monitoring it. That's as far as I would know at this point in time.

Mr. Chairman, I may have to ask you for a health break in a few moments.

The Chair: Before we do that, we will go back to the order in council. The law clerk has been rereading it and has something he wishes to say.

Mr. Rob Walsh: Mr. Chairman, I should advise the committee that on a further reading of this order in council--perhaps I read it in haste earlier--it appears to make reference to the confidences as being defined by the period running from July 1996 until the date of the making of this order in council, which is February 20, 2004. I had earlier read the words “in existence since July 1996” as referring to the definition of “confidences” found in section 39 of the Canada Evidence Act, and perhaps I was wrong in giving it that interpretation.

I would add that in light of the undertaking that I understood to be the case with regard to this inquiry by this committee, it would seem unfortunate that the lifting of the cabinet confidences begins only at July 1996, in view of the testimony this committee has received regarding earlier events. The witness may have been correct in his earlier understanding that this language of the order in council limits the confidences that are released to the period commencing July 1996 until the date of the making of this order in council, which is February 20, 2004, I believe.

The Chair: Thank you very much, Mr. Walsh.

Mr. Dingwall, if that is the proper interpretation, that it starts in July 1996, and you feel constrained by your oath of cabinet confidence in answering the questions and you have to invoke it, please say so.

We will see if we can get the date of that order in council made retroactive to, say, October 1993.

We will take a five-minute recess.

¸ (1429)

¸ (1431)

The Chair: We're back in session.

Mr. Proulx asked me if I would indulge him because he thought that for the question he asked in French and received a response in the other language, perhaps there wasn't an exact meeting of the minds. So he's going to ask his single question in English.

Mr. Proulx.

Mr. Marcel Proulx: Thank you very much, Mr. Chair. I appreciate your cooperation.

Mr. Dingwall, in my last question to you, I referred to an audit dating back to 2003. I of course knew that it applied after your tenure as Minister of Public Works. In the testimony of Ms. Cochrane, she brought us some information from that audit that said there was non-compliance with section 34 of the Financial Administration Act, such as invoices approved outside the contract period, fees paid not in accordance with the contract, etc. With your experience in that department, how could it be that 8, 10, or 12 public servants in a division of that department could have contravened all of these different rules and regulations without any lights coming on or anybody saying, “Wait a minute, something's wrong here”? How could that have happened in that department, sir?

Hon. David Dingwall: Mr. Chairman, I don't think I have a fulsome answer on that. Obviously, it's a management issue. I'm sure the deputy minister and the executive team would be setting out their appropriate audit plans for year one, year two, and year three. Risks would be identified, and then of course the necessary actions would take place. That's all I can offer at this point in time.

The Chair: Thank you very much.

Thank you, Mr. Proulx.

Ms. Longfield, eight minutes.

Mrs. Judi Longfield (Whitby—Ajax, Lib.): Thank you, Mr. Chair, and thank you, Mr. Dingwall, for being here.

Unlike some other members of the committee, I have not determined who was at fault and I'm not trying to pin it on anyone. I would like to get to the bottom of it and I'd like the truth, no matter what the truth may be.

Mr. Guité predates this government by many years. In fact, back in 1985-86 he was working on the national unity advertising effort. In 1993, the Ottawa Citizen reported:

“I'll tell you for the last time, there is no written report”, said Guité. “End of discussion on that issue.” He also confirmed that Treasury Board policy was not followed in this instance because “the policy is a guideline. It's not a rule. We change the guidelines to fit the situation.... (It's) not the first time it's been done and not the last time it will be done either.”

I would remind you that this is pre-1994, so it predates your arriving at the ministry.

It does beg the question, if in 1993 Guité had the reputation of being the fixer, someone who could get things done and didn't mind bending the rules, how is it that someone who takes this kind of public attitude continues to be promoted within the department?

I'd like to know what the promotion process is within Public Works and Government Services. Are there criteria that exist when someone moves from EX-1 to EX-2? Is there some sort of exam? Is there an interview? Who would be responsible for the interview?

And given that Mr. Guité actually received a promotion during the time that you were the minister, did you in any way have to sign off on this? Were you part of the interview? Did someone talk to you about it?

¸ (1435)

Hon. David Dingwall: Mr. Chairman, the member will know that the guidelines we announced here in this building, room 130-S in the House of Commons, downstairs, were guidelines that were approved by and had the support of full cabinet and caused several amendments to the contracting policy, the communication policy, and the holding policy. Those guidelines were part and parcel of the program's moving forward and they were substantive.

With regard to the issue of employees within a department, ministers quite rightly do not have the say, nor are they asked for the say, with regard to the promotion or demotion of a particular official. These issues are handled by senior members of the department, by the Public Service Commission. There are processes that have to be adhered to. There would be a paper trail, if you will, explaining why things went from A, B, C, D, E, and F. Those are not issues, as far as I am aware, on which a minister of the crown in the federal government would have any input, nor would his input be sought in terms of those promotions and/or demotions.

Mrs. Judi Longfield: Thank you.

Would it be your expectation that in Mr. Guité's personal file there would be performance reviews attached to his personal records?

Hon. David Dingwall: I don't want to misrepresent the facts, but not knowing about and not having any experience in terms of how those actual issues are handled, I wouldn't know what would be in his file, or indeed anyone else's file. But I think it would be reasonable to assume that there would be some paper to justify whatever promotion or demotion was taking place. Where that's at is something I certainly wouldn't be aware of; I've never been made privy to it.

Mrs. Judi Longfield: Former Minister, you indicated in your opening remarks to us that you did assume responsibility for your department. You even expanded on that to include the crown corporations that would have fallen under that. You also stated that essentially you were responsible for policy and the broad objectives, and the deputy was responsible for the day-to-day management.

Is that a fair representation of what you told this committee?

Hon. David Dingwall: Yes, but with this caveat: I am responsible, as the minister, for the good and for the bad. Being responsible means that I have to come forward to Parliament, as I'm doing today, testify before members of Parliament, and try to account for what has occurred. And where actions can be taken, the minister is responsible to take those actions. That's my understanding of the concept of ministerial responsibility.

There are several substantive interventions that have been made with regard to ministerial responsibility. I know we don't have enough time left in your question, but they should be put on the record so that all members of the committee are aware that this is just not an interpretation that I have laid before the committee. I think the chairman would agree that my assessment of the doctrine of ministerial responsibility has been pretty clear.

¸ (1440)

Mrs. Judi Longfield: No, and I'm not for one minute disputing that. What I wanted to do was to move on and say that you also indicated there was a certain responsibility that needed to be exercised by the President of the Treasury Board and the Treasury Board Secretariat with respect to government spending. I'm asking, from your perspective, what that responsibility would be.

Hon. David Dingwall: Again, that's a good question.

The Treasury Board is a central authority in the Government of Canada. It is there to enforce and make sure there is compliance with all of the rules and regulations as it relates to the expenditure of moneys. I may be going out on a limb here, but it is like the policeman. It does the enforcement. This doesn't mean that line departments have a free wheel here; they have responsibilities as well, but as a central authority, just as the Department of Public Works and Government Services is a central supplier to the government departments and agencies, this is the agency of the Government of Canada, as I understand it, that oversees and has the role in terms of compliance and making sure that things are followed and adhered to.

The Chair: Final question.

Mrs. Judi Longfield: Would it be your view that the President of Treasury Board would have intimate knowledge of the workings of each department in terms of whether the Treasury Board guidelines were being adhered to at every level?

Hon. David Dingwall: I think probably, in a perfect world, yes, but in the real world, Treasury Board ministers and ministers who are responsible for the Treasury Board have an understanding of the policy that has to be adhered to and they have officials who manage the programs and who watch the programs, who monitor the programs, review the audits and make sure the appropriate actions are taken. That's my understanding.

The Chair: Thank you.

Mrs. Judi Longfield: I have one final question.

The Chair: You're already up almost to nine minutes. I will just cut if off. We are going to run out of time.

Mr. Toews, eight minutes.

Mr. Vic Toews: Thank you, Mr. Dingwall.

From your testimony we've heard that you had absolutely no involvement in the sponsorship program because of the date when the sponsorship program started, and you've made it clear that there's a distinction between advertising contracts and sponsorship contracts. Are you as emphatic with respect to your lack of involvement in advertising contracts as you are in terms of your denial of any involvement in the sponsorship contracts?

Hon. David Dingwall: Mr. Chairman, I believe it was the Auditor General who said in her report that the sponsorship program did not begin until some time in 1996-97. I accept the findings of the Auditor General's report.

Mr. Vic Toews: Did you have any involvement with the advertising contracts in the same way you had no involvement with any sponsorship contracts?

Hon. David Dingwall: Mr. Chairman, I was responsible for the Department of Public Works and Government Services, and an agency, APORS, was under the jurisdiction of that department.

Mr. Vic Toews: Did you have any direct involvement with any of the advertising contracts? That's my question.

Hon. David Dingwall: Not to my knowledge, Mr. Chairman, no.

Mr. Vic Toews: Not to your knowledge, all right.

You became minister in 1993. Is that correct?

Hon. David Dingwall: Yes, Mr. Chairman.

Mr. Vic Toews: We heard from the testimony of Mr. Cutler that there were no problems with the contracts from 1990 until 1994. There was a major shift, in terms of Mr. Guité interfering with individual contracts, in 1994. Are you aware of any of that interference, personally?

Hon. David Dingwall: No, I'm not, Mr. Chairman.

¸ (1445)

Mr. Vic Toews: No, you're not?

Hon. David Dingwall: No, I'm not aware.

I've read the testimony before this committee subsequent to the findings of the audit report.

Mr. Vic Toews: So, no involvement...?

Hon. David Dingwall: To make a very clear point, Mr. Chairman, during the time that I was minister, I was not made aware of the diary that was being kept.

Mr. Vic Toews: I'm not talking about the diary. I'm just asking you to confirm or deny, or let us know what you know.

We understand you became the minister in 1993. In May of 1994 the new regulations were brought in to tighten up contracting. We then heard that on November 17, 1994, there was a complete collapse of the watchdog function. So about five months after you brought in the new guidelines, we had a complete collapse of all of the watchdog functions in November of 1994, a year before the October 1995 referendum in Quebec.

Do you know anything about this collapse on November 17, 1994, or the details of that meeting?

Hon. David Dingwall: No, Mr. Chairman.

I read the testimony the honourable member refers to. I am not sure the honourable member was here, but I think I indicated in a previous answer that I was not made aware of the exchange that apparently took place between the two individuals. But I did share with the committee that since this was a decision of cabinet in April, as announced in May, the Treasury Board, Public Works, and the Privy Council Office had to come together with regard to the contracting guidelines; therefore, if there had been such a conversation, I think I probably would have remembered it, because it would have changed the guidelines, in my view.

Mr. Vic Toews: All right.

So on November 17, 1994, we see a collapse of this watchdog function, and we see Mr. Guité starting to interfere in a major way with all of these contracts. That was the testimony of Mr. Cutler. When this concern was raised with Mr. Guité at that meeting, Mr. Guité said he would talk to the minister to have the rules changed.

Did Mr. Guité come to discuss with you changing those rules?

Hon. David Dingwall: Mr. Chairman, I think I've indicated several times in the testimony I provided that there was no changing of the rules, because I had no authority to change the rules.

Mr. Vic Toews: All right. All you're saying then—if I can summarize it—is that Mr. Guité did not come to you to discuss the changing of the rules at the end of 1994, whether it's November or December, or even January of 1995. He had no conversation with you about changing the rules.

Hon. David Dingwall: Mr. Chairman, what is important is the changing of the rules or the non-changing of the rules.

Mr. Vic Toews: No, no, I want the answer, Mr. Chair, as to whether Mr. Guité came to the minister to ask him to change the rules. I want him to answer directly, instead of evading, the way he's doing.

Hon. David Dingwall: Mr. Chairman, I respectfully disagree with the honourable member and the premise of his question.

The Chair: Mr. Dingwall, the question was, did Mr. Guité ask you to change the rules? Don't disagree with the question. That was the question. What is the answer?

Hon. David Dingwall: Mr. Chairman, I've already answered that question.

Mr. Vic Toews: Well, then, answer it again.

Hon. David Dingwall: Oh, Mr. Chairman.

The Chair: Okay, Mr. Dingwall, the floor is yours.

Hon. David Dingwall: Mr. Chairman, there was no such discussion.

Mr. Vic Toews: All right. So you've testified now that there was no discussion between you and Mr. Guité, either directly with Mr. Guité or in the presence of other individuals, regarding changing those rules. Is that correct?

Hon. David Dingwall: Mr. Chairman, to the best of my knowledge, the answer is yes.

Mr. Vic Toews: We've also heard from the deputy minister that he was out of the loop and didn't know what was going on in this respect. Do you have any reason to doubt the testimony of Mr. Quail in respect of his lack of knowledge?

Mrs. Marlene Jennings: On a point of order, Mr. Chair, I believe if we were to verify the transcripts of former Deputy Minister Quail's testimony from when he made those comments, we'd see he was making them with regard to the creation of the sponsorship branch outside of the box. He was not talking about the period when the Honourable David Dingwall was the Minister of Public Works, so I think the member should put those quotes in the proper context so as not to mislead. I'm sure he would not want to mislead the witness.

¸ (1450)

The Chair: I can't remember exactly what Mr. Quail did say. He did talk about not being in the loop, to use Mr. Toews' paraphrase, or that type of thing.

For the timeframe you referred to, if Mr. Dingwall feels Mr. Quail was not out of the loop when he was a minister, he's quite capable of saying so.

Mr. Toews, did you want to finish your question?

Mr. Vic Toews: That's precisely my point. If I'm wrong on that point, if Mr. Quail was in the loop during that time as far as you're aware, I want to know. I think that's an issue that needs to be explored by this committee.

Hon. David Dingwall: Mr. Chairman, Mr. Quail said on June 13, 2002, “The reporting relationship did change during the tenure. Before 1997, the reporting responsibility for Mr. Guité was to an ADM of government operational services.”

I had full confidence in Mr. Quail; I'm certain he was in the loop on all the issues that affected the Department of Public Works.

Mr. Vic Toews: Can you explain just one thing for me? When former Minister Marleau came here, she testified that when she went into her office virtually the first day, Mr. Guité appeared and said he reported to the minister. She said “No, you don't; a director doesn't report to the minister”. Do you have any idea where Mr. Guité would have gotten that kind of impression, that he actually reported to the minister, you being the minister prior to Madam Marleau?

Hon. David Dingwall: No, Mr. Chairman, I do not.

Mr. Vic Toews: Thank you.

The Chair: Thank you very much, Mr. Toews.

Madam Jennings, s'il vous plaît, you have the floor.

Mrs. Marlene Jennings: Thank you.

The policy guidelines were brought in by you following cabinet approval in 1994-95, and Treasury Board then pushed them down the line to all of the various government departments. If I'm not mistaken, in those guidelines it stipulated that once the process of open bidding and selection was complete for the advertising or communications firms that would carry out opinion polling and research, final approval rested with the minister. I remember I was struck by that when I read the guidelines in their entirety.

So my question to you, through the chair, would be, did you in fact approve the final selection of those communications and ad firms that would get the contracts for advertising, polling, and opinion research, or was that authority delegated? And if it was delegated, to whom was it delegated?

Mr. David Dingwall: Mr. Chairman, there are a lot of questions in that intervention. To give you a fulsome answer, I'll say that as the minister responsible for Public Works I did not approve the various agencies. What happened is that for the line departments, if there was a conflict whereby two bidders had made applications or submissions deemed to be of equal value, then the minister of the line department would have the authority to make the choice. The choice for the Minister of Public Works was not on that side of the dossier.

Mrs. Marlene Jennings: Thank you for that clarification.

I'll share the rest of my time with Mr. Lastewka.

Hon. Walt Lastewka: Thank you very much, Mr. Chairman.

One of the items I wanted to still get cleared up, if I can find my notes, was that there seemed to be an understanding.... I'm going back to the comments that were made by Ms. Marleau, where Mr. Guité had come to her and said,“I report to you.” I want to make sure it's very clear—you spelled it out earlier—that you did not have dealings with Guité directly, that you were operating under merging the two departments. Having had some experience in mergers, it's my concern always that when people change position in mergers, people in the various departments decide to make their own understanding of what's really happening. I'm concerned from the standpoint that we did a merger and there weren't internal audits or any other mechanisms to make sure the merger was being implemented.

Did you as minister have any mechanism in place with your deputy minister to make sure the two departments that were being merged were being merged as expected in your mandate?

¸ (1455)

Hon. David Dingwall: Well, Mr. Chairman, in fairness to the deputy, not only did he have to merge Public Works and Supply and Services, but he was involved in a major downsizing of about $350 million over a couple of years, absorbing about 19,000 employees, and then thereafter had to reduce the number of public servants within that department. That in itself is a major piece of work for anyone to do. I suspect—and it's just an “I suspect”—that his executive committee and his executive team would be identifying the risks, watching for the risks and trying to address them, and would have the appropriate contingency plans for that.

Ministers would be brought the issues that would require urgent decisions or presentations before Treasury Board or other cabinet committees on issues that would be coming out as a result of the merger, but the management function was with the deputy. The minister was there to set the policy, to report to Parliament, and of course to speak for the department as a whole.

Hon. Walt Lastewka: So is this the reasoning, that because of the cutbacks maybe there weren't enough internal audits being done, and maybe some procedures we thought were in place were not in place, that things were let go as a result of implementation of the mergers and the changes and cutbacks?

Hon. David Dingwall: That's a reasonable interpretation. I'd want to hear more testimony from different witnesses before I would make any profound conclusions about what had transpired. But I think in his evidence or testimony before this committee, Mr. Quail indicated this really wasn't on his radar screen per se. It was a significant amount of money—I think we have to agree to that—but nevertheless, in relation to other things within the department, it wasn't the biggest ticket item he had to deal with at that point in time.

I don't think anyone should underestimate the significance of the program review and what it meant for officials, for ministers, for attempting to achieve the objective of balancing the books. It was an exciting time, but it also was an extremely difficult thing to do.

Hon. Walt Lastewka: I keep coming back to this, because I'm really concerned that when there was a merger done there weren't proper systems put in place to make sure the merger was being done as outlined in your mandate or the mandate of the department; to make sure that the items that were to be merged were done right, without gaps in areas that allowed individuals from wherever to go on their own rather than adhere to a practice that was supposed to be established.

Can you comment on that?

¹ (1500)

Hon. David Dingwall: As I said earlier, it was an exciting time, but it was a difficult time. There were a number of HR issues that had to be addressed, and the management team did that as effectively as they could. But there was pressure, and I don't think we should underestimate the pressure.

After the budget of 1994, even the chair will recall that there were rumblings in various circles in the world that Canada had better get its act together in terms of balancing its books, and that had a significant part to play in terms of the activities that took place.

Hon. Walt Lastewka: Thank you, Mr. Chairman.

The Chair: Thank you very much, Mr. Lastewka.

Now we're going to get four minutes from the Bloc and four minutes from the New Democratic Party.

[Translation]

You have four minutes, Mr. Guimond.

Mr. Michel Guimond: Thank you, Mr. Chairman.

In your opening statement, you said the following, and I quote:

I invested my credibility and that of the government in the establishment of the 1994 guidelines...

Surely you're referring to the May 1994 guidelines.

Let's talk a bit about credibility. Earlier, I asked you a direct question. I bluntly asked you if Mr. Kinsella, your Chief of Staff, had been involved in the selection of firms, and you told me that he had not. I showed you the letter signed by Mr. Guité advising him that the recommendations were to be approved as quickly as possible. It's apparent that Mr. Kinsella was involved in the process in some way. Mr. Guité must have had some reason for sending him that letter.

Let me remind you that this letter is dated February 22, 1995 and that the rules were supposed to be in effect at the time. Apparently, some rules weren't being followed.

[English]

Hon. David Dingwall: A cursory review would suggest that this is nothing more than information in alerting the department. I was prepared to proceed with the awarding of a contract, and I think of note, it was an award on an open and fair competitive process.

[Translation]

Mr. Michel Guimond: Moving on to another subject, you were first elected on February 18, 1980. Correct?

[English]

Hon. David Dingwall: Yes.

[Translation]

Mr. Michel Guimond: So then, you're a long-time Liberal Party member. Correct?

[English]

Hon. David Dingwall: Yes.

[Translation]

Mr. Michel Guimond: Do you know a man by the name of Jean Prévost?

[English]

Hon. David Dingwall: No, I don't believe I do.

[Translation]

Mr. Michel Guimond: Jean Prévost was the Vice-President of the Liberal Party of Canada for Quebec. Does the name ring any bells?

[English]

Hon. David Dingwall: What years?

[Translation]

Mr. Michel Guimond: He served as Communications Director for the Liberal Party of Canada during the 1979, 1980 and 1984 federal elections. You're not familiar with the name at all?

[English]

The Chair: You're going back a long way, Mr. Guimond.

Hon. David Dingwall: Mr. Chairman--

The Chair: We know Mr. Dingwall has been a member of the Liberal Party for a long time too.

Hon. David Dingwall: Mr. Chairman, it goes back some 24 years.

The Chair: Madam Jennings.

Mrs. Marlene Jennings: On a point of order, Mr. Chair, the pertinence of the question, given that--

The Chair: I was just going to get there. I was kind of concerned about the--

[Translation]

Mr. Michel Guimond: You'll understand once you hear my next question.

[English]

The Chair: Okay, the next question will resolve the--

[Translation]

Mrs. Marlene Jennings: I'd like him to explain how the question is relevant.

[English]

The Chair: Okay, we'll get there.

Mr. Dingwall, and then back to Mr. Guimond.

Hon. David Dingwall: Mr. Chairman, it was 24 years ago. Has he written to me? Has he exchanged correspondence? Have I met him somewhere? Did I meet him at a cocktail party?

[Translation]

Mr. Michel Guimond: Suppose I were to tell you that in 1994...

[English]

Hon. David Dingwall: I can't honestly recall, Mr. Chairman.

[Translation]

Mr. Michel Guimond: Is it possible that in 1994, he was asked by the Department of Public Works to be a member of the committee in charge of selecting advertising firms?

[English]

Hon. David Dingwall: It could be possible, yes.

[Translation]

Mr. Michel Guimond: Who in the department was in charge of appointing persons to the committees responsible for selecting advertising firms? This was in fact your department's responsibility.

[English]

Hon. David Dingwall: Mr. Chairman, under the checks and balances for APORS, there were two representatives from APORS, two representatives from the private sector, and two representatives from the line department, who were together for the purposes of the evaluation of the bids--

[Translation]

Mr. Michel Guimond: Therefore, sir, can you...

[English]

Hon. David Dingwall: --which was a change from the previous administration and the administration before that.

[Translation]

Mr. Michel Guimond: On page 6 of Chapter 4 of the AG's report, details of a lucrative contract are provided. The report notes that $65.7 million in contracts were awarded to BCP. Mr. Prévost, an influential member of the Liberal Party, was on the selection committee, as was Ms. Marlene Hore, the chief architect of the Liberal Party's advertising campaigns in 1993 and 1997. She was appointed by Public Works Canada, the department that you headed up in 1994.

The AG noted the following:

In our opinion, advertising contracts were awarded to BCP on a sole-source basis. There is no assurance that the government obtained the best value for these expenditures. Other potential suppliers were never given the opportunity to compete for the $65.7 million in contracts.

Do you think this reflects sound management practices, Mr. Dingwall?

¹ (1505)

[English]

Hon. David Dingwall: On the checks and balances we had for APORS, one was the evaluation committee. We involved private sector representatives and of course the line departments and representatives from APORS. The other check was the reporting of the contracts to Treasury Board on a regular basis to ensure there was competition and that there would be value for the money that had been put forward.

The Chair: Merci beaucoup, Monsieur Guimond.

I see that the Ernst & Young audit actually talked about the selection committee and the methodology with which it was dealt. That is contained on page 2 of the eight-page document.

Madam Wasylycia-Leis is next, please, for four minutes.

Ms. Judy Wasylycia-Leis: Thank you, Mr. Chairperson.

I would like to put all my questions at the front end together, in case I run out of time, given that I have only four minutes left.

I want to start by saying to Mr. Thibault, given his point of order at the outset of this session, that I have expressed problems with Mr. Dingwall's testimony to the media. Frankly, I have a great deal of difficulty believing his testimony. He has said again this afternoon that he was the minister responsible for the good and the bad, yet every time we ask about the bad, he knew nothing, heard nothing, and saw nothing. I don't think it's much different from what we heard from Mr. Gagliano.

Hon. Robert Thibault: Point of order, Mr. Chair.

The Chair: Mr. Thibault.

Hon. Robert Thibault: This is precisely the point I raised, Mr. Chairman. This is the danger. I mean, one person is putting all her questions forward now before hearing any answers, in case she runs out of time. Therefore, the questions are more important than the answers.

Second, just to--

The Chair: That is not a point of order, Mr. Thibault. Interviewers have eight minutes, as allocated. How they use that is entirely at their discretion, not at anybody else's discretion. So if they want to ask all the questions at once, which sometimes happens, and they get very long answers, that's the way they have phrased it and they have used their time. That's not a point of order.

Hon. Robert Thibault: Then excuse me for mentioning that, but I'll get to the point of order immediately.

The Chair: Okay, then get to the point of order.

Hon. Robert Thibault: The point of order is passing judgment on a witness before the witness has testified. The testimony isn't done, and the credibility of this witness is being called into question by a member of the committee.

The Chair: Thank you very much, Mr. Thibault. This is a committee of Parliament. We are in the public domain. Members of Parliament, of course, operate in the public domain. If Ms. Wasylycia-Leis wishes to make a comment of that kind, she will no doubt substantiate it and be prepared to stand behind it. But it's her right and privilege to make these comments as she so desires.

Mr. Dingwall is not a stranger to this place. He knows exactly how the system works.

Madam Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: Thank you, Mr. Chairperson. We've been at it now for about three or four hours, and I'm afraid we aren't getting the answers. So I think it's very important to continue to press these same questions and to indicate our skepticism. I'm afraid we have another Liberal witness portraying the ministers of cabinet as acting like Greek deities up there in the clouds, totally removed from the ordinary, day-to-day conniving of the public servants. So give me a break. It's time we got some answers.

I want to say to Mr. Dingwall, first of all, you have a questionable track record when it comes to value-for-money initiatives in government and transparency. In fact, you were the minister between 1993 and 1996, when the seeds of the most horrific scandal in the history of this country were planted and allowed to germinate.

Secondly, in 1995, when you were Minister of Public Works, you signed a deal on behalf of the Atlantic Canada Opportunities Agency--

Some hon. members: [Inaudible—Editor]

¹ (1510)

The Chair: Order, please. We will not have conversations across the floor.

Madam Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: --for a property at 338 Charlotte Street in Sydney. The Auditor General then reviewed that and found in 2000 that the minister and the government did not provide value for money and that there was a complete lack of transparency.

Let me also say--it's all related, I would say to Mr. Mills, who is always looking for the truth--that if we want to--

An hon. member: [Inaudible—Editor]

The Chair: Order, please.

We are disintegrating a little bit here.

Madam Wasylycia-Leis, you have the floor.

Ms. Judy Wasylycia-Leis: I am establishing a track record of invariable weakness when it comes to value for money and transparency. We might also reference, if you would like, the $600,000 “Ding-wall” in Cape Breton, which is well documented. I might also take the path and lead it right to 1996, when Mr. David Dingwall became the Minister of Health and oversaw an audit of wrongdoings, which, because they were not dealt with and were covered up, probably became the second biggest scandal in the history of this country in terms of the Virginia Fontaine Addictions Foundation.

Mr. Dingwall, isn't it true that you have a very questionable track record when it comes to value for money?

My second question relates to the fact that you expect us to believe that at a time when we were at war in terms of the future of this country, you allowed your office to run on autopilot. With all of your political experience, you didn't have something to offer in terms of your advice, your background, and your position as Minister of Public Works. You're trying to tell us that you had nothing to say before or after the referendum. Give us a break. Come forward with the facts in terms of what exactly you and your department did vis-à-vis trying to fight this so-called war in our country.

Finally, Mr. Chairman, my third question has to do with contracts to ad agencies. I would like to know from Mr. Dingwall what his relationship is with Mr. Tony Blom, who is the president of Compass Communications, and whether after he was defeated he continued to ensure that the largesse of government was continued into other regions, including Winnipeg and the Pan Am Games.

Hon. Walt Lastewka: I have a point of order.

The Chair: I want to deal with this before we get to the point of order.

Mr. Dingwall, since her time has been consumed and I'm sure you will need more than four minutes to answer, if you would like to submit them in writing, that would be appreciated.

Some hon. members: Oh, oh!

The Chair: I didn't say he had to. I just said if he'd like to submit them in writing, he may do so.

Mr. Lastewka has a point of order.

Hon. Walt Lastewka: I'm trying to get clarification on your timing. We allow a member to rant and rave and use up her time and to not allow the witness to speak. I think that's an insult not only to the witness but also to the committee members.

Mrs. Judi Longfield: They don't want answers.

The Chair: One person at a time.

Mr. Lastewka.

Hon. Walt Lastewka: I think it's a waste of time. She can't stand the truth.

The Chair: Mr. Toews.

Mr. Vic Toews: Mr. Chair, I thought it was a very good summary of some of the questions that I'm also asking, and I'm very pleased that Ms. Wasylycia-Leis--

An hon. member: That's not a point of order, Mr. Chair.

The Chair: We've heard comments back and forth. We've heard enough.

We're now going to go to Mr. Proulx and Mr. Thibault for four minutes each. Mr. Mills has one question he would like to ask as well. I have some questions of my own. Then we'll wrap this up.

Mr. Proulx, you may use your four minutes as you so choose.

Mr. Marcel Proulx: Mr. Dingwall, would you like to answer the questions my colleague from across the table asked you?

Hon. David Dingwall: First of all, Mr. Chairman, through you to the member, I want to thank the member opposite for that ringing endorsement of my tenure as a member of Parliament.

I disagree with her quite strongly in terms of a track record. She picks out moneys that were spent at the University College of Cape Breton, which I am quite proud of, in terms of a facility that needed upgrading.

Perhaps it would suffice to say that if we didn't provide the necessary moneys for the advertising campaign in the province of Quebec prior to the referendum, there would be an honourable member from her party crying as to why we didn't do it. That's the only comment I could make, Mr. Chairman, with regard to the interventions that this honourable member has made. It's unfortunate, but that is the case.

The Chair: Mr. Proulx.

Mr. Marcel Proulx: Mr. Dingwall, it is on the record that Public Works and Government Services took the decision to assign agencies from the agency of record process and apportion them to departments. In essence, an agency would be assigned to a department by PWGSC. That practice seems to have predated your services--in other words, during the Conservative government. Correct me if I'm wrong, but it doesn't seem to have been fixed under your watch. Was it?

¹ (1515)

Hon. David Dingwall: Well, we think so, Mr. Chairman.

If memory is correct here, in 1993 the previous administration had the agency of record.... It was a firm whose contract I extended by a year, as we were trying to get our guidelines in place and inform all the line departments as well as all the agencies of the Government of Canada.

Second, and this is in Treasury Board notes, there was a competition for the purposes of the agency of record, which for many, Mr. Chairman, never took place. In fact there were even some individuals who believed the following, if I may quote, Mr. Chairman, from Hansard: “The advertising business is not amenable to tendering. It is not tendered anywhere in the world--in the free world, that is, where they have advertising.” That was said by the then Minister of Supply and Services in the previous administration. So I think we've made gargantuan changes in terms of the guidelines and the practices that took place within the Government of Canada.

Mr. Marcel Proulx: Thank you, Mr. Dingwall.

Thank you, Mr. Chair.

The Chair: Thank you.

M. Thibault, s'il vous plaît, quartre minutes.

Hon. Robert Thibault: M. le président, since we can use our time as we so wish, I'd be tempted to offer you my time, Mr. Dingwall, so you could tell us exactly what you think of the member opposite. But knowing you for the gentleman that you are, I know you would not want to contribute to turning this into a three-ring circus, or abusing a privilege you have at this committee, or making a presentation that makes personal attacks on an individual, especially an individual such as you, who volunteers to come and contribute to this process to help us resolve a very difficult problem, which is how we ensure that we never have something like this happen in the future.

As a man who followed you by a few years in one of your portfolios, I benefited greatly from the changes you made at the Atlantic Canada Opportunities Agency to make sure the funds we had, rather than go toward grants to institutions, as they had for many previous years, were loans only and that they contributed to true and lasting economic development.

I know we all benefit from the changes you made. What we want is to find out how this broke down and how we can make sure it never happens again. So, Mr. Dingwall, I have a couple of questions for you.

First, when you took over the program it was at $140 million per year, as I understand, and it was reduced. Could you tell us how you achieved those reductions and how much they were?

Hon. David Dingwall: Mr. Chairman, again, reference is being made to the previous administration, but the problem was there well before the previous administration. It existed under Mr. Mulroney, it was under Mr. Trudeau, and we tried to grapple with the issue as best we could.

Looking back 10 or 11 years after the fact, could the guidelines have been improved? Could we have done something differently? Probably, in retrospect, they could have been. But at the time we were bringing forward guidelines that were groundbreaking, that offered transparency and openness. Competitions were taking place, as evidenced...I think members have seen the Treasury Board documents. There were regular reports to Treasury Board on this, and we think under the circumstances we did pretty well.

Could there have been additional improvements? The answer is obviously yes, and with the testimony and evidence you're getting here, I think there are opportunities to make even further improvements in subsequent years, Mr. Chairman.

¹ (1520)

Hon. Robert Thibault: In regard to the changes that you and others were recommending to cabinet at that time, which were approved and became the guidelines, how did those fit in with other government initiatives at the time? Would that have been part of a larger set of initiatives?

Hon. David Dingwall: In terms of the guidelines, Mr. Chairman, from a budgetary point of view, we had as our first-year objective to reduce it by 25%. I think we achieved 50%. I think the noted amount was approximately $60 million, but I think if you were to check at Treasury Board, it was even substantially less than that. I recall seeing one of the documents presented here to the committee, and I think it was $45.4 million that we spent in 1994-95. It increased in subsequent years, but I think the historical high before that was roughly $140 million.

But we were all seized--the deputy was seized, the ADMs were seized, directors general all across the government were seized--with reducing the expenditures of the government prior to and during program review for the purposes of keeping our budgets on track, Mr. Chairman.

As I said, it was exciting, but it was a very difficult time.

The Chair: Mr. Mills insists that he get a very, very, very short question.

Mr. Dennis Mills: It's a very short political question, Mr. Chair.

The Chair: We'll go with the political question.

Mr. Dennis Mills: The point here is that aspersions have been cast on all of these agencies that are listed—

The Chair: Your question, Mr. Mills.

Mr. Dennis Mills: The aspersions are that they were Liberal agencies.

Was not the criterion in the province of Quebec to make sure that whatever agencies we chose, they were federalist in cause, rather than other agencies that had a sovereigntist view?

The Chair: Okay, thank you, Mr. Mills.

Mr. Dingwall.

Hon. David Dingwall: Well, Mr. Chairman, I don't think the public interest would have been served before the referendum if the government had retained firms that were of a different political persuasion, particularly those that wished to take Quebec out of Canada.

The Chair: Do you have a point of order, Mr. Toews?

Mr. Vic Toews: Yes. I'm somewhat surprised that this witness is giving testimony about a time when he has testified he knew nothing about this issue.

The Chair: Well, there you go.... Mr. Dingwall did exercise his.... He was still a member of the House until 1997.

Anyway, Mr. Dingwall, I have to say that the picture you have painted today does not sit with the perception that I had of cabinet and the government in the running of this country. You seem to present the position that the cabinet was sitting in an ivory tower, developing some wonderful policies, then handing them over to the public service and saying, “It's up to you to implement them”. Yet in your own words, these were dealing with “a very serious issue”, the potential separation of the province of Quebec.

I would have thought that since there was a unity fund, the cabinet would have been consumed by this issue. They would have likely had it on the agenda every week; they would have discussed the latest public opinion polls; they would have decided what the next strategy or initiative would be; and they would have talked to the people involved, not just the deputy minister, but the people who were doing the programming and the advertising and the buying of the billboards, and breaking every rule, because “we were at war”, according to Mr. Guité.

You would have been consumed, but you have painted this sterile picture of cabinet being in a room, totally and completely divorced from all operations. I can't believe it's so. Tell me it's not so.

Hon. David Dingwall: Mr. Chairman, I think the legal counsel from the committee quite rightly identified that cabinet confidences—

The Chair: This is not a cabinet confidence.

The country wants to know that this is not the way the government runs, in an ivory tower, where it doesn't follow up and get feedback on decision-making. It doesn't sit well with me, Mr. Dingwall.

Hon. David Dingwall: Mr. Chairman, I respectfully disagree. Legal counsel has indicated to the committee that there are certain cabinet confidences. Let me say, in a generic way, that the subject matter of what was taking place in the province of Quebec was not only discussed in cabinet, but it was also discussed in caucuses and in Parliament.

The Chair: Everywhere.

Hon. David Dingwall: It was discussed in a variety of venues across the country. Different individuals of different political persuasions participated in that debate. I was one of those individuals who participated in that debate.

I'm happy to report that although it was a close encounter, we were successful in convincing the good people of the province of Quebec that their place remained in Canada, not out of Canada.

¹ (1525)

The Chair: Thank you very much, Mr. Dingwall.

The way you have painted the workings of cabinet, to me it happened in spite of cabinet, not because of cabinet, that the country did not fall apart.

Anyway, you're talking about the rules that you instigated as you became the minister. In fact, there were very little beforehand.

Now, it has been stated that Mr. Guité had his own ad agency. Is one of your rules that civil servants can't have their own ad agency?

Hon. David Dingwall: When was this?

The Chair: I was asked by a reporter today about Mr. Guité having his own ad agency.

My question is, do the rules prohibit public servants from having their own advertising agency?

Hon. David Dingwall: Mr. Chairman, I would assume that under the employment guidelines of any department or agency of the Government of Canada, that would not be allowed.

The Chair: But it's not part of your rules?

Hon. David Dingwall: Well, it's because it's part of the guidelines for employment that are adhered to by the public service of Canada.

The Chair: So if Mr. Guité did have his own advertising agency, it wasn't breaking any of the rules that you've been talking about today?

Hon. David Dingwall: Mr. Chairman, you'll have to share with me when this allegation was revealed and what the timeframe is. If someone has left the service of the--

Mrs. Marlene Jennings: A point of order, Mr. Chair.

The Chair: A point of order?

Mrs. Marlene Jennings: Yes. Could you specify exactly when Mr. Guité is supposed to have had an ad agency?

All of the media I have read have stipulated it was once he retired that he opened up his own consultancy agency. If you've read otherwise, I would respectfully ask the chair to table it in the committee.

The Chair: I was asked by a radio station this morning about Mr. Guité's advertising agency. My question is, do the rules preclude it?

Mr. Dennis Mills: It's a point of order. Give us the timeline on this.

The Chair: I only asked if the rules precluded it.

Mr. Dennis Mills: No. Mr. Chair, is there a timeline? If Mr. Guité did have his own agency, when did it happen?

The Chair: I only asked if the rules precluded public servants from having their own advertising agency. Mr. Dingwall can say “yes” or “no”.

Now, I have my next question, Mr. Dingwall. We have this letter addressed to Mr. Kinsella, which has been distributed to the people today, that was raised earlier by Mr. Guimond.

Did you get a copy of it, Mr. Dingwall?

Hon. David Dingwall: Yes, Mr. Chairman.

The Chair: You have a copy of it.

This is a letter from Mr. Guité to Mr. Kinsella, who was your executive assistant—in fact it's addressed to him, as your executive assistant in the minister's office—asking him to ratify the recommendations regarding the hiring of advertising agencies as soon as possible.

Does Mr. Kinsella have that authority? Was he going to check with you and therefore give your authority or approval and ratification to Mr. Guité?

Hon. David Dingwall: Mr. Chairman, this was a regular occurrence. It was a matter of an award after an open and fair competition process with regard to the agency of record, and my office was so involved.

The Chair: I thought you said you didn't get involved in the rules. Are you now saying that you do actually pick and choose contractors?

Hon. David Dingwall: No, Mr. Chairman.

The Chair: Well, which way is it?

Hon. David Dingwall: No, Mr. Chairman.

The Chair: No, you don't get involved.

Hon. David Dingwall: I don't get involved, but I think there's a duty and a responsibility of the minister to receive representations and to know what's going on.

The Chair: No, you ratify. You don't receive representation; you ratify. These recommendations should be ratified as soon as possible.

Did you ratify decisions of the bureaucracy when you were the minister?

Hon. David Dingwall: This was the agency of record, which fell within the ambit of the Department of Public Works and Government Services. As the minister responsible, I would have to ratify that contract, Mr. Chairman.

The Chair: Why that contract and not all of the other contracts that Public Works enters into every day?

Hon. David Dingwall: For the checks and balances of what Treasury Board, Public Works and Government Services, and Privy Council put in place, there was an evaluation team. If there were two contracts of equal value, the evaluation team would take that to the line minister. They would make the decision if they were both equal. It would be up to that minister, not the Minister of Public Works.

The Chair: I think based on your previous statement saying you would rather not hire advertising agencies in Quebec that had a separatist point of view or philosophy and you'd prefer to have those of a federal point of view, the political involvement of the minister was “I'm prepared to acknowledge that it was important”.

I'm also saying that perhaps ministers should acknowledge that they were involved too when they come before the committee.

¹ (1530)

Hon. David Dingwall: Mr. Chairman, as a minister of the crown, I fully supported the government's decision for the purposes of additional advertising in the province of Quebec prior to the referendum. We didn't pick or choose the advertising agencies. That was done by the officials who had the responsibility.

The Chair: But you ratified these decisions.

Hon. David Dingwall: No, Mr. Chairman. I ratified the decision of the agency of record, which is a separate contract; thereby, they place all the ads for the various departments. There was a competition, the competition proceeded, and it came up to the minister.

Thank you.

The Chair: According to the Auditor General, these agencies of record were taking huge commissions for no work. Weren't you aware of that?

Hon. David Dingwall: Excuse me, Mr. Chairman, what I was aware of is that it was the normal procedure within the industry that an agency of record would get a certain percentage, in terms of the work they were providing in getting the contract. I don't recall what the specific number was at that time, but it was the norm.

I'm sure if you checked with the advertising institute and any other of those organizations, they would concur with that, Mr. Chairman.

The Chair: My final comment is that since this was a very serious issue--your words, and the Prime Minister, Mr. Chrétien, used even stronger language than that to describe it--there remains the fact that you would have an agency of record doing what the Auditor General tells us they were doing, which was passing cheques on but with no benefit, no added value, and getting a large commission, and if you were on top of the separation file, you'd have been much more concerned about ensuring that every ounce of value that you were spending to save the country did actually provide that value.

Ladies and gentlemen, we'll just stop there.

Mr. Keddy has a notice of motion.

Mr. Gerald Keddy: Thank you, Mr. Chairman.

It is important to read the notice of motion into the record while our witness is still here. It is that the committee send a letter through the Clerk to the Privy Council requesting that the order in council that we discussed here today be amended so as to include confidences from December 1, 1993, to July 1996 relating to the matters discussed in chapters 3, 4, and 5 of the Auditor General's report.

Thank you.

The Chair: Fill in the blanks for that period. That's a notice of motion. We will bring that forward at the appropriate time.

Is there unanimous agreement that we deal with this motion?

Some members: Agreed.

The Chair: There is unanimous agreement. Read your motion, Mr. Keddy.

Mr. Gerald Keddy: I just read it. Should I read it again?

The Chair: You can read it again. It's about we obtain...fill in the gaps.

Mr. Gerald Keddy: Mr. Chairman, I move that the committee send a letter through the Clerk to the Privy Council requesting that the order in council that we discussed here today be amended so as to include confidences from December 1, 1993, to July 1996 relating to the matters discussed in chapters 3, 4, and 5 of the Auditor General's report.

The Chair: I call the question.

(Motion agreed to)

The Chair: It is carried unanimously.

Mr. Toews, do you have another motion?

Mr. Vic Toews: I move, Mr. Chair, that in relation to the study of chapters 3, 4, and 5 of the November 2003 report of the Auditor General regarding the sponsorship matter, the Standing Committee on Public Accounts request from PWGSC both the first and the second administrative review reports of sponsorship files that were conducted by Kroll Lindquist Avery for PWGSC, in their entirety.

The Chair: That is accepted as a notice of motion.

Mr. Dingwall, I think you are excused. Thank you so much.

Mr. Dennis Mills: Mr. Chair, can I put a notice of motion as well?

The Chair: If you have a notice of motion, yes.

Mr. Dennis Mills: The thing is that everybody's in the.... It's that we summon the chief financial officer and chief government relations persons from the following advertising agencies: Gosselin, Everest, Palmer Jarvis, Vickers & Benson, Compass, Coffin, Groupaction, Publicité Martin.

The Chair: That's accepted. Thank you.

We are going to ask--

¹ (1535)

Mr. Dennis Mills: Is there unanimous consent?

The Chair: I think we'll put it to the steering committee and get it dealt with.

Mr. Dennis Mills: We gave unanimous consent before for the previous two. Who's opposing? Are there people opposing?

The Chair: Do you want me to ask if there is unanimous consent?

Mr. Dennis Mills: Yes.

The Chair: Is there unanimous consent that we deal with Mr. Mills' motion now?

Mr. Vic Toews: No.

Mrs. Judi Longfield: He doesn't want to hear them. Put it on the record that Mr. Toews doesn't want to hear it.

Mr. Derek Lee (Scarborough—Rouge River, Lib.): Mr. Toews doesn't want to hear it.

The Chair: We'll refer that to the steering committee; it will be brought forward in due....

Mr. Toews.

Mr. Vic Toews: Ms. Longfield indicated that I don't want to hear from these individuals--

Mr. Dennis Mills: These are the people, Mr. Toews, who you said stole the money.

The Chair: Thank you very much, Mr. Toews. If you're dealing with Mr. Mills' motion, it has been accepted as a notice of motion and we're not going to deal with at this point in time. We'll have to bring it back. There was not unanimous consent because some people felt they didn't want to hear about it.

Mrs. Marlene Jennings: Because Mr. Toews refused unanimous consent--

The Chair: Mr. Toews, on a point of order.

Mr. Vic Toews: I want to put it on the record that I want to review the names. I don't know whether they are all the names that should be there or if they're the right names. I will review it and get back to the committee.

Mr. Dennis Mills: I have a point of order, Mr. Chair. They were all the names of all the agencies that were distributed to this committee two weeks ago, the names of the agencies that Mr. Toews last week said stole the money.

The Chair: Order.

Mr. Dennis Mills: He cast aspersions on all those agencies.

Mr. Vic Toews: It's your Prime Minister who said that.

Mr. Dennis Mills: He did not say that.

The Chair: Order. I will have order.

Mr. Dennis Mills: Say it outside this room.

Mr. Vic Toews: I will. I have.

The Chair: Order. Will you please remember that the people of Canada are watching this committee? All of you remember that. The people of Canada are watching what we're doing.

I'd now like to invite Mr. Victor Duret, a partner with KPMG, to come forward. He is, as you know, representing KPMG and is the forensic auditor who is assisting the committee in our deliberations and in our work. He will bring us up to date as to what he and his team have been doing.

We have a report from him that we will now distribute. Where is the report?

I have just been advised that the report is in one language and the other language is going to be along very soon. Do you wish to hold until such time as it is available in both languages?

Monsieur Guimond, as I said, we have the report, but I've just found out that it is in one language only. The second language will be along very soon. Is there unanimous consent for us to distribute in one language, and the other one in a few minutes?

[Translation]

Mr. Michel Guimond: That is out of the question. I refuse to be the censor of the Official Languages Act of Canada.

[English]

The Chair: Okay.

[Translation]

Mr. Michel Guimond: There are two languages in this country, or at least that is what you would have us believe. Therefore, I refuse to go along with this.

[English]

The Chair: I fully agree, Monsieur Guimond, which is exactly why--

[Translation]

Mr. Michel Guimond: There was no need for you to ask, Mr. Chairman.

[English]

The Chair: It is my responsibility to ask, Monsieur Guimond, and anybody on the committee can say no.

[Translation]

Mr. Michel Guimond: On a point of order, Mr. Chairman.

When a witness appears before the committee without documents in both official languages, there is no point requesting unanimous consent to circumvent the rules. I chaired this committee for a year and a half and I refused to allow a witness to table a document that wasn't in both languages. I didn't bother to seek unanimous consent to do otherwise when I chaired these proceedings. I simply refused to do it. That's your job. I don't want to censor Canada's Official Languages Act. In any event, I want nothing to do with Canada, and you know my position. With everything that's come to light...

¹ (1540)

[English]

The Chair: Monsieur Guimond, I'm not going into a long discussion on the issue, but the other day we were asking for the distribution of a document that was in French with no English. It's the same situation.

An hon. member: On a point of order--

The Chair: No, we're not getting into a whole bunch of points of order. The issue is that the committee, being the master of its own destiny, can choose to do whatever the committee wishes. If the committee wishes to deal in one language, two languages, or ten languages, that is its--

Mr. Marcel Proulx: No, the committee doesn't have the choice, Mr. Chair.

[Translation]

This is a parliamentary committee and there are two official languages, French and English.

[English]

The Chair: I agree with you, Mr. Proulx, 100%.

Mr. Marcel Proulx: Then don't ask permission. It's both languages.

The Chair: Okay.

Monsieur Duret, s'il vous plaît, your report verbally, without the written version.

Mr. Victor Duret (Partner, KPMG): Thank you, Mr. Chair.

KPMG was retained approximately two weeks ago to assist the public accounts committee and the Library of Parliament in this important matter. During these two weeks we've attempted to catch up to a committee process that has been underway for some time. Over the past two weeks we've developed a high-level strategic plan, which I'll discuss with you briefly.

In addition, the activities we've undertaken are accumulating and reviewing documents that have been received to date by the committee. We've identified, contacted, and in certain circumstances met with potential witnesses to determine if they have relevant information or testimony. We've prepared witness questions for committee members. We've responded to various requests from the clerks and researchers from Parliament. And we've set up a field office on Wellington Street for the purpose of providing control and administration over the process.

In terms of documents, the committee should know it has not received many of the documents it has asked for under its motion. This is simply, I suspect, a timing issue, but many of the documents that would be helpful are not available at this point.

In addition, the committee has not received all information about potential witnesses. In addition, of course, as witnesses come forward, new witnesses and potential witnesses come forward, so that process is ongoing.

The type of investigation being conducted by the committee is complicated. It concerns many parties and it covers a significant period of time. My experience is that these investigations take considerable time and require careful planning. Towards this end, we've developed a strategic plan, which I'll discuss with you briefly.

What we've tried to do strategically is think about it in three areas. One is the area of ministerial responsibility and accountability to Parliament. That really focuses on ministers, Treasury Board, deputy ministers, the audit process, and so on. Clearly, there's a role for CCSB and its predecessors, and then there's a role around specific sponsorship transactions. Really, CCSB is the one where the two sort of intersect, and we need to understand that intersection much more clearly than we do now. Obviously, as witnesses come forward and new information comes forward, we're going to be required to keep amending this plan as we go ahead.

The first of the three major steps we're engaged in is document management, which really consists of reviewing current documents, audit reports, transcripts, and the government documents we have received to date. We are sourcing new documents. As I mentioned and as you know, there are motions to obtain new documents. Those are coming in.

We are in discussion with the Auditor General about what if anything she can provide, as it relates to specific transactions, that might help the committee in its questions on those. There are issues of electronic evidence and whether there are places we can get evidence other than in documents, and there's the issue of getting access to more Public Works documents.

In addition, as I mentioned, there are more witnesses coming forward, other whistle-blowers. They need to be assessed, and it needs to be determined whether in fact they should be put in front of this committee.

There are databases being put together around media and document management. There is a database to manage the documents, and we are trying to develop organization and relations charts. Clearly, there are many relationships here the committee needs to understand.

The second area we're focused on is witness identification and screening. One of the things we've been suggesting and to some extent doing is interviewing subordinate people at organizations prior to the heads being put in front of the committee. Clearly, in many cases it is the subordinates who will understand the specific transactions. We are in each case trying to go down and identify potential witnesses, interview and screen those, see what they can or cannot provide to the committee, and then advise the committee through the clerk as to what our view of that is. Obviously, it is not our decision who will appear here as a witness, but I think it is a useful function in terms of trying to screen and then present witnesses who can provide information in the limited time the committee has.

In addition, we're trying to perform a role doing witness preparation and scheduling, and towards that end we're suggesting that what we need to get to in due course is some kind of rolling monthly calendar so we know who the witnesses are in advance so the committee is able to prepare, we're able to prepare, and those witnesses have time to prepare as well.

We're attempting to assist the committee members so they'll be in a position to query witnesses by media searches and by reviewing transcripts and audit reports. In many cases, as we go along, we will have interviewed the witnesses in advance and can provide a sort of “will say” statement. We will be presnt at the hearings to hear what different witnesses have to say and to see how it intersects.

¹ (1545)

Those are the areas we've been working on. I'd be happy to answer any questions the committee may have.

The Chair: We'll just take individual questions. I'm not going to allocate times.

Mr. Toews, do you have a question?

Mr. Vic Toews: This gets back to my concern about the push on bringing the notice of motion to call the heads of the agencies. It seemed to me, Mr. Chair, there was undue haste on the part of the Liberals to get the heads of the agencies here. As the witness has basically indicated, if I've understood correctly, there is probably a better way of bringing witnesses forward than just agreeing to lists of witnesses cooked up by Liberals.

I appreciate Mr. Duret's approach to this. That's the reasonable way; it's the appropriate way. A lot of times, as we've seen here, there are better witnesses at the lower level, who can give us the background before we bring the agencies.

So I would certainly endorse what Mr. Duret is doing. I think that is much more reasonable than the approach Mr. Mills had suggested.

The Chair: Madame Jennings, then Mr. Lastewka.

Mrs. Marlene Jennings: I fear Mr. Toews may not have been present when you, Mr. Chair, put all members of this committee through an exercise concerning where our priorities were for witnesses and the sequence of appearances.

The overwhelming majority of members of this committee—including the majority if not all of the members of the opposition who were present at that time—agreed that the heads of the crown corporations, including chief financial officers, would be the first priority. The second priority would be the heads of the advertising agencies, and so on.

I can understand that Mr. Toews has perhaps changed his mind since then, if in fact he was not present at that meeting, but this committee did in fact make a decision, and it's based on that decision that the steering committee and witness committee has been moving forward. It would take, I think, a change of the entire committee's decision as to sequences.

The Chair: The committee did, without using names, prioritize the groups of people we felt were important to hear from. I know the clerks have had serious difficulty being able to line these up in an organized fashion. It would be good if, with the assistance of KPMG, we can get several weeks out in front. We've been trying to do that with no success so far, but it's certainly our intention to move that way so that we have a regular list of witnesses and the committee knows what's coming down the pipe.

Mr. Lastewka.

Hon. Walt Lastewka: I would just add to what Ms. Jennings said. Mr. Toews is very quick to accuse and insult everybody. He's the one who has mentioned that the advertising firms “stole the money”, so let's hear the other half of the story. I didn't know that he said it outside the room.

The Chair: Mr. Tonks.

Mr. Alan Tonks: Mr. Chairman, I have a question of Mr. Duret, if that would be all right.

The Chair: Yes, of course. This is the whole idea, to ask questions of Mr. Duret and not get into a—

Mr. Alan Tonks: Well, you can appreciate why I would have missed the point of it.

Some hon. members: Oh, oh!

Mr. Alan Tonks: Mr. Duret, the question has been raised, with respect to the advertising companies, about real value added. It would seem to me the only way you could really audit value added would be to hear from them, or at least to interview them, whether it's through the auditor or the committee. Did you take that into consideration in your strategic plan?

¹ (1550)

Mr. Victor Duret: Yes, in the specific sponsorship transactions we've talked about, we clearly intend to attempt to interview the ad agencies and understand what they have done.

Mr. Alan Tonks: In terms of how that washes through the chronology, then, when would it happen?

Mr. Victor Duret: We are in the process now of speaking to—or have tried to reach the heads of—different agencies, as I know the clerk has. In one or two cases, we have been provided with the names of others, and we have started to interview those to try to understand what, if anything, they can bring to this committee.

Mr. Alan Tonks: So it would be your proposal or your position that at some point they would have an opportunity to appear before the committee, but it would be at such point as you would be prepared, I suppose, to lead the committee in terms of their net position, would it?

Mr. Victor Duret: I don't think it's to me to lead the committee. I think there is an exercise to go through to try to identify, as an example, in an ad agency, who are the.... For instance, in one case we have eight names. The question would be, does the committee need to hear from eight people, or if in fact when we speak to them we determine that three people would provide the committee with what it might need...? Again, it is not our role to make that decision.

Mr. Alan Tonks: Right. That's what I meant.

Mr. Victor Duret: We would bring to the committee that these are the eight people, these are the names, and this is what this person can say and cannot say.

Mr. Alan Tonks: I would suggest sooner, rather than later.

Mr. Victor Duret: Yes, we're trying to do that.

Mr. Alan Tonks: Absolutely.

The Chair: Mr. Mills.

Mr. Dennis Mills: Thank you very much, Mr. Chair.

Mr. Duret, I need to know that the auditors who will be doing this examination have had history, experience, and skill in examining other firms from that sector. If you were going to do a mining audit, you'd bring people in from your team who had previous experience from that sector.

What has happened here over the last two months is that we've had people make conclusions who do not understand the sector, the industry, the creative process. As a result, their capacity for judging value for taxpayers' money or impact on whether or not the taxpayers got a return on their money has been virtually zero.

The Chair: Mr. Mills, Mr. Duret is--

Mr. Dennis Mills: I'm asking Mr. Duret--

The Chair: I know, but let me tell you, Mr. Duret is a chartered accountant. He is a partner with KPMG. He's a designated specialist in investigative and forensic accounting.

Mr. Duret.

Mr. Victor Duret: To answer your question, Mr. Mills, what we typically do in a situation, and we'll certainly be doing in this situation, is to bring industry specialty to it as we begin to understand the transactions. So it starts off with a base of could somebody in the organization explain the contracts, who did what just physically? Are there reports, or are there not? It's those kinds of basic questions.

Then, as you say, there's a question of, whatever was done, is it value for money? But first we have to get through the base understanding. Then, yes, I understand your point that the advertising industry has certain standards, and agencies of record are something that exist in that business, and we need to understand that before comments are made about the appropriateness or inappropriateness of it.

The Chair: Mr. Duret, you normally conduct your work not so much in the public eye as this particular investigation or assisting the committee. Based on your previous work, can you give us some idea of the issues you are confronting because you are working in the public eye, rather than not in the public eye, and the issues of how far we have come in a month and how much more we have to do, the conceptual problems you've had to wrestle with, whereas if you had been called in by say the RCMP or an audit committee of a large corporation, you would quietly and diligently do your work behind the scenes, but not this time?

Mr. Victor Duret: There's no question that the environment we're operating in creates some unique problems. Witnesses are concerned about coming in front of this committee, given the public situation, as is known. There are police investigations ongoing. That has raised concerns to people. So that has created difficulty in getting people to communicate with us as fully as they might.

In addition, of course, we're dealing with a significant amount of information that has taken place over a significant period of time, and we have to get our heads around exactly what the issues are and which ones we're going to concentrate on.

The Chair: How are we doing so far?

Mr. Victor Duret: We are getting there. We need to get ahead of the witness list. I think it would be to everybody's benefit if we could identify witnesses further in advance and could prepare both the witnesses, frankly, and the committee for their testimony. So that is something we are trying to do.

¹ (1555)

The Chair: Mr. Mills.

Mr. Dennis Mills: Building on your point, Mr. Duret, do you have the list that was tabled to our committee two weeks ago of the nine agencies that Mr. Toews said stole the $100 million?

Mr. Victor Duret: Is that the list that displays the $83 million, and so on?

Mr. Dennis Mills: Yes.

Mr. Victor Duret: Yes, I have that list.

The Chair: Whatever was tabled before the committee, Mr. Mills, everything has been passed on to them. They are assisting the committee.

Mr. Dennis Mills: That's what makes it so strange that a former attorney general would cast such an aspersion on a group of professional organizations before they got to the bottom of it.

The Chair: We're not going to get into a political fight, but Mr. Toews, I guess you're entitled to—

Mr. Dennis Mills: It's not a political fight; it's due process.

The Chair: —respond to that.

Mr. Vic Toews: I am entitled to respond.

Thank you, Mr. Chair. I want to just indicate that I think I can refer him back to the former Prime Minister, who said perhaps there were a few million dollars stolen. Then this is what the current Prime Minister said:

Anybody who is found to have known that people are kiting cheques, that people are falsifying invoices--me or anybody else--should resign. Anybody who knew that kind of thing was going on and let it happen, they don't belong in public life.

Then I want to refer Mr. Mills to the Auditor General's report—first of all, to point number one of the overall main report, then to paragraphs 3.41, 3.44, 3.48, 3.88; and then—dealing with non-compliance and the lack of due diligence amounting to, in my opinion, theft or fraud—to paragraphs 3.57, 3.68, 3.73, and 3.83.

If Mr. Mills will look in the Criminal Code at the definition of “fraud” and compare it with those paragraphs, perhaps he'll understand what I'm speaking about.

Mr. Dennis Mills: I have a point of order, Mr. Chair.

The Chair: Mr. Mills, you brought up this issue. Mr. Toews responded—

Mr. Dennis Mills: I have a right to respond to this under a point of order.

The Chair: We're not going to go back and forth. I brought Mr. Duret—

Mr. Dennis Mills: But, sir, you are being partisan—

The Chair: I'm sorry, Mr. Mills, I brought Mr. Duret here to answer questions, to advise the committee where the work he has been doing has reached, and to assist the committee. Now, if you want to break it down—

Mr. Dennis Mills: On a point of order.

The Chair: I have the floor, thank you.

If you want to break it down into a partisan political fight so that the people of Canada give up on this committee ever getting anywhere, that's what you will do by continuing on this line. We have to stop it at some point, so we'll stop it right here.

Mr. Dennis Mills: It's a point of order to you, Mr. Chair, not to Mr. Toews.

In paragraph 3.13 of chapter 3 of her report, the Auditor General said:

We did not audit the records of the private contractors. Consequently, our conclusions cannot and do not pertain to any practices that contractors followed.

So, Mr. Chair—

The Chair: Okay, you got your point on the record, Mr. Mills.

You may both have points, but the issue we're here to investigate is one the Auditor General brought to our attention. This is a serious investigation; much money has been unaccounted for, whatever terminology you want to use; and Mr. Duret is here to assist us. He is the person to whom I thought you'd have been asking detailed questions about how he can assist us in the best way he can. That's what I was hoping when I brought him forward here.

Mr. Duret, do you have anything else to add?

Mr. Victor Duret: No, sir.

The Chair: All right.

Mr. Lastewka. Now, is this a question of inquiry to Mr. Duret, so that we can move the agenda forward? I do want it to focus on Mr. Duret. I don't want political statements—

Hon. Walt Lastewka: Mr. Chair, I'm always focused.

º (1600)

The Chair: Very good. Thank you.

Hon. Walt Lastewka: My question to Mr. Duret is this. I wanted to capture those items he has requested from Public Works and Government Services. If there's any assistance I could help him with, I'd be glad to help him.

Mr. Victor Duret: On that front, we are developing a database of information we think the committee should have. We're looking at what the committee has asked for by way of motion, what the committee has received, perhaps what additional motions we would suggest should be brought forward, and in addition we will bring back the lists to say “These motions have been in place and we have not gotten anything, and perhaps the committee could—”

The Chair: Thank you.

On that basis, concerning your database of outstanding requests for documents, if you'd let Mr. Lastewka know what is still outstanding, as the parliamentary secretary to the minister he can perhaps move it along faster. As you identify gaps in the documents we require, we will bring the motions to the table so that the committee requests these documents, not KPMG, and Mr. Lastewka again can be kept apprised of the progress of receiving these documents.

Is that all right?

Mr. Victor Duret: Yes, we will do that.

The Chair: Are there any further questions to Mr. Duret?

Mr. Lee.

Mr. Derek Lee: It seems to me there are several lines of inquiry here that may take us into areas where we'll have to direct our own attention to resourcing costs. Has anyone reviewed with our witness the costs of both what is being developed now and—in the event recommendations come forward to take us into who knows where that we might want to go—the costs of actually probing, auditing, verifying, questioning outside this room?

We'll be using professional services to go in a number of directions, much in the way the public inquiry will be doing when it gets underway. We might not want to duplicate territory. Could I ask the witness, has the issue of costs of services that we from Parliament would be paying for your valuable professional assistance been addressed with you, and have you provided estimates to us?

The Chair: I think I'll answer that question, Mr. Lee.

It was put out for public tender. Substantial amounts of money were approved as an upper limit to keep the services going for some number of weeks, or even months. As the committee moves forward in opening up these lines of inquiry, we will have a discussion with the auditor to find out if that has to be tendered again for a subsequent amount down the road.

It was a fairly sizable public tender. There's a scope of work as per the contract with the Library of Parliament that they've just given to me, and it sets it out in fairly significant detail.

Mr. Derek Lee: Thank you.

The Chair: Thank you.

Ms. Longfield.

Mrs. Judi Longfield: Just out of curiosity, who approved the tender--who reviewed the tender?

The Chair: The Library of Parliament put the tender together. The Library of Parliament hired KPMG.

Mrs. Judi Longfield: Thank you.

The Chair: Mr. Proulx.

Mr. Marcel Proulx: I had the same question.

Thank you, Mr. Chair.

The Chair: Okay, I think that's it.

This meeting is adjourned until tomorrow.