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Adscam "smoking gun has been 
found:" Harper 

[PoliticsWatch Updated 5:45 p.m. February 3, 2005]

Conservative Leader Stephen Harper speaks in the House of Commons on Thursday. 

OTTAWA — Conservative Leader Stephen Harper said in the House Thursday that the latest testimony at the Gomery inquiry is the "smoking gun" linking the sponsorship program to Liberal Party organizers. 
"The smoking gun has been found," Harper said. 

Testimony out of the Gomery inquiry into the sponsorship program on Wednesday revealed that a top Liberal Party organizer, Jacques Corriveau, received work from the sponsorship program at the same time he was owed what former public works minister Alfonso Gagliano described as a substantial amount of money from the party for work his design firm did for the 1997 Liberal election campaign. 

Gagliano testified that nearly six months after the election, Corriveau was meeting with him and Jean Pelletier, chief of staff for former prime minister Jean Chretien, to discuss the Liberals' overdue election bill.

"The party had not yet paid his bill and he met with Mr. Pelletier to put on pressure," Gagliano testified. "This represented considerable sums of money."

Corriveau's firm, Pluridesign, was not listed among the firms in Auditor General Sheila Fraser's scathing report into to sponsorship program. 

But at the inquiry Wednesday, commission counsel Bernard Roy revealed Corriveau received "many millions in subcontracts" from Le Groupe Polygone Editeurs. 

Polygone won $40 million in sponsorship work while the program was in existence. 

But the inquiry also heard that Corriveau's firm had been a subcontractor on sponsorship projects before the 1997 election campaign and before the Liberals owed him money.
Harper criticized the Martin government for not releasing this information to an earlier parliamentary investigation into the sponsorship program. 

"Why was this not revealed to the public accounts committee before the election as he promised?" Harper asked.

Prime Minister Paul Martin and Public Works Minister Scott Brison continued their tradition of not commenting on day-to-day testimony coming out of the inquiry. 

"I would have thought that the leader of the Opposition, having stood up in the House numerous times with information that was incorrect, taken out of context, contradicted the next day, would learn that fundamentally the Gomery commission should be allowed to do its job," the PM said in response.

Harper accused the PM of hiding behind the judicial inquiry and said it showed a "gutless lack of integrity."

Meanwhile Gagliano spent much of Thursday at the inquiry denying that he called the shots on numerous sponsorship grants, even when documents suggested he played a role. 

Gagliano was questioned at length about his role reversing an earlier decision to reject a grant application by the Old Port of Montreal. 

The port had requested $1.5 million from the sponsorship program to pay for the cost of a giant screen television. 

The auditor general's report noted that the sponsorship program reversed its decision after the port made a presentation to Gagliano. 

Minutes tabled at the inquiry from an April 17, 2000 meeting at the Old Port suggested that Gagliano told officials for the port he was committed to finding the funding for the giant screen. 

However, Gagliano denied that he got the sponsorship program to reverse its earlier decision and only told port officials to apply for a grant. 

Gagliano said the final decision was made by the director of the sponsorship program at the time, Pierre Tremblay, who had previously worked as one of his aides. 

The Old Port of Montreal sponsorship was highlighted in the auditor general's report because two ad firms - Lafleur Communication and Media I.D.A Vision --received commissions totalling $225,000 for simply "facilitating the transfer" of $1.5 million in funds from the sponsorship program to the Old Port, which is a government entity. 

"The files did not show what, if any value the Crown received for the $225,000," the auditor general said in her report. 

To top it off, the entire transaction was done without a contract. The Old Port went ahead with the purchase of the screen before it received the money, but wound up only receiving $1.2 million from the ad firms responsible for transferring the funds. As of last year, the port had not received the remaining $300,000. 

Gagliano testified that the auditor general was the first to inform him about the use of ad agencies to transfer funds. 

"I was surprised," he said. "I wondered why a communications company was hired to purchase a screen? I was quite surprised."

He also testified that he was not aware a contract was never signed. 

The auditor general described the use of the sponsorship program to pay for the giant screen as an "inappropriate transfer of sponsorship funds for a Crown corporation's capital asset."

Gagliano, a former accountant, differed with Fraser's interpretation of the purchase being inappropriate. 

"We had a difference of opinion. But I'm just an accountant. She's the auditor general, so," he said with a shrug. 

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