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Gagliano's testimony 
Day 2 (part 1)

(PoliticsWatch posted March 19, 2004) OTTAWA - Standing Committee on Public Accounts
Comité permanent des comptes publics
EVIDENCE NUMBER 11, TÉMOIGNAGES DU COMITÉ NUMÉRO 11
UNEDITED COPY - COPIE NON ÉDITÉE
Transcription up until 11 :05 a.m. only - Transcription jusqu'à 11:05 seulement
2004-03-19

¿ (0910) 
[English]
The Chair (Mr. John Williams (St. Albert, CPC)): Good morning everybody.
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 the Public Opinion Research of the November 2003 report of the Auditor General of Canada, referred to the committee on February 10, 2004.
Our witness today, as an individual, is the Hon. Alfonso Gagliano and the orders of the day are, of course, we go from now until 11 o'lock. We'll break for half an hour,11:30 to 1:00 and that will be the end of the day.

Before we get into--I see some people indicating--but before we get into that, I just want to say that I think many members yesterday were frustrated with the answers we were getting and the media has reported the same, that this committee is having difficulty in pushing through to the meat of the issue. I therefore discussed the issue with Mr. Walsh, the Law Clerk of the House of Commons. I've asked him to say a few words about the responsibilities of this committee and the responsibility of witnesses and so on before a parliamentary committee.
Mr. Walsh.

Mr. Rob Walsh (Procedural Clerk): Thank you, Mr. Chairman.
My remarks are not meant to be a reflection on this particular witness that this committee is hearing and my view, while my remarks may apply in respect of this witness, they may well also apply in respect of earlier witnesses the committee has heard.

I am concerned by the public comments and some members' comments about the difficulties, as you say, Mr. Chairman, in eliciting from witnesses testimony of a kind that it would seem the committee wants to obtain to enable it to draw conclusions about the details relating to the administrative matters pertaining to this sponsorship matter.

I would like to remind the committee and I mean this with the greatest respect, because you do have a function which is very important to the life of this country as a parliamentary committee, but you are not a court of law and you are not a judicial enquiry, you are a parliamentary committee; and you are charged and fully entitled to enquire into all matters of public interest with respect to public policy or public administration. 

You are not required to draw and find evidence of a kind that enables you on the legal standard of beyond a reasonable doubt or balance of probabilities to draw conclusions of fact. You are not triers of fact, you are triers of matters of public policy. It is something like the Sherlock Holmesian expression of the dog that didn't bark and that being a piece of evidence or a clue to the outcome of the investigation. What you don't hear is as much evidence here today as what you do hear. 

In my view, when witnesses come before this committee they are obliged to give a full and complete accounting to this committee before the first question is asked. It is not the case that the onus is on the committee to think of the right question to elicit the right information. The onus is on the witness, in my view, every witness and particularly deputy ministers and ministers, including former deputy ministers and former ministers, to provide a full and complete accounting to this committee on matters relevant to the subject matter of the enquiry. Again, I don't mean to suggest in my comments that this witness is in any way more responsible for not being frank with this committee than any previous witness.

But it is the case that there is some sense of difficulty on the part of the committee members about whether you are getting a full and complete accounting of matters relevant to the sponsorship dossier. If you don't get what you are looking for, that is evidence itself if, in your judgment, the witnesses you're talking to are in a position to tell you more. 

I'm concerned that the media that seem to be picking up on this idea that you're not getting the testimony you should get, the media seem to be painting this committee into an evidentiary corner as if you're a court of law or a judicial enquiry and can't come to any conclusions unless you find smoking guns or whatever the analogy might be. That's not true. You are here on behalf of the people of Canada making an enquiry on a matter of public interest in respect of public policy or public administration and you are fully entitled to get a full and complete accounting from every witness who comes before you and if you don't or feel you don't, that itself is evidence that can be taken into account in making your report to the House.

Mr. Chairman, I thank you for the moment to make those comments. I thought it might be of assistance to the committee.

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

I do appreciate these comments, because, as you know, we want to get to understand the ministerial accountability, the government's responsibility to Parliament and of course, we have a responsibility to Canadians to explain and to find and determine in public how this fell apart to the degree that it did so that we have these total lack of controls that allowed problems to be created.

Mr. Walsh.

Mr. Rob Walsh: Thank you.

I failed to make a point that I wished to include in my oversight and didn't, the point being here that this committee could, at the end of the day, address the question of ministerial responsibility, address the question of deputy ministerial responsibility, articulate standards of ministerial responsibility and the standards of deputy minister responsibility based on the evidence they have heard or have not heard, the accounting they have received or not have received which they thought they should have received and that could be the subject of a report by this committee, unlike a judicial inquiry, which can't make a report of the same kind and you could include in your report remedial suggestions to the House for consideration by the government with respect to ministerial accountability and responsibility and deputy ministerial responsibility and accountability.

The Chair: Okay. This ministerial accountability is fundamental to our system of government, responsible government and democratic government. If this committee, as a committee of Parliament, feels the whole truth is not willingly being laid before us, then the democratic process of a responsible government is being threatened and under attack.

Ministers and deputy ministers, members of the public service, have the obligation--obligation--to Parliament to be fulsome and forthright in their answers without reservation. They have privilege. The testimony given before this committee cannot be entered in a court of law and cannot be used against them. We all know that. The witnesses know that.

I know I am getting frustrated, I know other members of this committee are frustrated by the lack of fulsome answers.

We will have a few short questions on this point I've raised.

Mr. Mills, followed by Mr. Gauthier.

Mr. Dennis Mills (Toronto-Danforth, Lib.): Thank you very much, Mr. Chairman.

I'd like to address my question to Mr. Walsh, if I may be permitted.

You talk about full and complete accounting. I agree with you on this specific point. As the chairman said, if we don't have full and complete accounting, then the democratic system is under attack.

Do you have concerns, Mr. Walsh, that we do not have the information in front of us on the $85 million of production costs for those 2,000 events that happened over five years across Canada?

For one, I've spent the better part of my life in this type of business and I find it very strange that media and others would suggest there wouldn't be production costs related to each and every one of these events. I don't see how we can even get to the bottom of asking proper questions until we have an analysis of what those production costs are and what they represent.
¿ (0915) 
The Chair: Thank you, Mr. Mills.

Mr. Walsh, do you have a response?

Mr. Rob Walsh: Mr. Chairman, my comments weren't meant to address the particular issue that concerns this member relating to production costs. My concern was to bring to the committee's attention that its mandate doesn't depend on getting that particular piece of information or any other particular piece of information.

Although it may be relevant and of legitimate interest to the committee to obtain it, it has a function notwithstanding the unavailability of certain evidence that it might have thought it should have. I'm just saying your mandate is not one of a court of law or a trier of fact, who must have certain evidence before it can draw a conclusion. You are a parliamentary committee and you're entitled to listen to the accounts given to you, including what is not given to you, and to make your conclusions accordingly.

The Chair: Mr. Gauthier.
[Français]
M. Michel Gauthier (Leader en Chambre du Bloc Québécois): Monsieur le président, afin que notre comité fonctionne mieux, je dirais que tout le problème vient du fait--j'ai observé vos travaux, hier--que les interrogations sont très limitées dans le temps. Alors, dans l'esprit de vouloir faire davantage la lumière et que nos travaux puissent se dérouler de la meilleure façon possible, j'aimerais faire une proposition. Je suis sûr que j'obtiendrai l'accord de mes collègues des autres partis, et certainement du parti ministériel, puisque le premier ministre, on se rappelle, compte beaucoup, dit-il, sur les travaux de ce comité pour faire la lumière sur toute cette question.

J'aimerais donc faire la proposition suivante: Que le temps d'intervention, au besoin, pour chacun des partis, puisse être porté à 15 minutes, compte tenu du fait que M. Gagliano se montre très disponible et qu'il pourra être réinvité devant le comité ultérieurement. Alors, il me semble qu'un temps de 15 minutes permettrait un meilleur questionnement, qui nous permettrait de mieux comprendre les réponses de M. Gagliano et donner la chance M. Gagliano la chance de s'expliquer davantage. Je crois que tout le monde pourrait être satisfait. Cela permettrait vraiment de faire la lumière. Alors, j'en fais une proposition, monsieur le président.
[English]
The Chair: Okay, thank you very much, Mr. Gauthier.
Before we deal with that issue I'm going to wrap up any particular questions to Mr. Walsh.

Mr. Toews, did you have a question for Mr. Walsh?

Mr. Vic Toews (Provencher, CPC): I just want to make a comment.
I want to thank Mr. Walsh for clarifying the role of this committee. I think that in the media there have been some conflicting views as to exactly what the role of this committee is, and it's clear that we're not a criminal inquiry. We're not a civil judicial inquiry. At the same time, I too am frustrated. I feel a lot, Mr. Chair, like trying to play pin the tail on the donkey while being blindfolded. You're spun around here. Unless you actually hit the tail right in the proper place, you don't get a response, and the comment that Mr. Walsh made that the witnesses are under a positive obligation to come forward with evidence is absolutely crucial and that this committee, Mr. Chair, is entitled to make adverse inferences against witnesses who fail to disclose what in fact occurred while they were engaged in the public business.

I want to express my appreciation to Mr. Walsh for clarifying that comment. For example, yesterday the entire Conservative side, four members, had a total of 32 minutes. In this kind of trial in a civil matter you would have hours and hours and hours, so it's a very difficult process. If the witnesses aren't forthcoming, the work of this committee is lost.

Thank you.
¿ (0920) 
The Chair: Thank you very much, Mr. Toews.

Madam Jennings.

Mrs. Marlene Jennings (Notre-Dame-de-Grâce-Lachine, Lib.) (Notre-Dame-de-Grâce-Lachine, Lib.): I'd just like to say that I do appreciate the comments that Me Walsh has provided this committee. I think it's very important that all members of the committee do, in fact, have foremost in their minds that, as Mr. Walsh said, we are not triers of fact. We are here, and our mandate is very clear. 

Our mandate is to Parliament in order to report on ministerial responsibility as it is now defined and has been for decades and whether or not that definition has served Parliament and has served the Canadian people well. 

The witnesses who come before us, whether they be current ministers, former ministers, current deputy ministers, former deputy ministers and so on, as Mr. Walsh said, have a positive obligation to provide us with all information. They also have an obligation, may I say, when any member asks a question any ordinary, reasonable, thinking Canadian knows what the object of that question is, if it is framed in clear, plain language, and therefore, if it's missing one word or one date it is incumbent on the witness to answer fully. That witness is as intelligent as the average Canadian and knows where the member who is asking the question is going. 

Therefore, to use the expression of Mr. Toews, don't force us to be blindfolded with a pin in our hands trying to hit the pinata, or a bat in our hand trying to hit the pinata. Everybody knows the pinata is there. Everybody knows the bat is there and the object of the bat is to hit the pinata. You know that. Give us the answers, please. If you don't know, say so straightforwardly, "I do not know," or say, "It may be, but honestly I do not recall." 

My last point, Mr. Chair, is that on the issue of ministerial responsibility, as I said, we already know-and I think it's been pretty clearly established-what it is traditionally. I think that with the testimony that we've heard to date and quite possibly the testimony that we will be hearing shortly in the coming days we will be in a position to already identify if there are weaknesses, if there are holes in that tradition, and to begin thinking about, collectively, what kind of recommendations we can make to change that.

The Chair: Thank you very much, Madam Jennings.

On a point of order, Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Mr. Chair, a point of order. Well I appreciate the discussion and I'm glad Mr. Walsh brought this forward but we are loosing valuable time with an important witness. Could we please proceed, Mr. Chair?

The Chair: We will get to the witnesses when we can. We can call them back if we want. I think this is an important discussion that we're having and I will ask our clerks to put together a synopsis of Mr. Walsh's statement to be delivered to all witnesses before they come to this committee so that they know exactly what our thinking is so that we expect them to come paraphrasing Mr. Walsh to make a fulsome disclosure before the first question is asked.

Mr. Tonks. 

Mr. Alan Tonks (York South-Weston, Lib.): Mr. Chairman, I'm not sure whether we need a big tail or a bigger target but I do think that Mr. Walsh's overview is helpful against what the Auditor General had said. It's what I was trying to remind the committee about yesterday in terms of what she had said was the ultimate goal of the committee. I think it helps just to remind the committee along with what Mr. Walsh has said in terms of guiding our questioning, she had said that it's not just a question of a few rules being broken. That the system would appear to have been designed in such a way to put commissions in the hands or communications' agencies and so on around the processes. 

I think that she is reminding us to attempt to find out whether that was a deliberate action and how the various fail-safe provisions from Treasury Board and so on broke down. I think that's the intent of the questioning, Mr. Chair, and I think Mr. Walsh is reminding us that.

The Chair: Do we need to belabour this anymore, Mr. Desrochers?
[Français]
M. Odina Desrochers (Lotbinière-L'Érable, BQ): Non, non. Je veux seulement qu'on se penche sur la proposition de M. Gauthier. Est-ce que...
¿ (0925) 
[English]
The Chair: Okay, okay. So we're finished with Mr. Walsh.
[Français]
M. Odina Desrochers: 
[English]
The Chair: Now before we get into that, remember ... Just let me speak. That Mr. Gauthier said in order to fully ask the questions. A number of people didn't get a chance to speak at all yesterday. Mr. O'Reilly didn't have a chance to speak at all. That was with an eight minute round. So keep that in mind when you're talking about Mr. Gauthier's proposal. So we'll have two or three interventions and then I'm going to call and see what the consensus of the committee is.
Madam Jennings. 

Mrs. Marlene Jennings: It's an interesting suggestion. However I would point out that when Mr. Toews says that the Conservative Party at the end of the day had 32 minutes, the Bloc had 32 minutes, the NDP had 32 minutes or close to and when one adds up the amount of time that the Liberals had, it does not equal the total amount that the opposition had. So I would be in favour if the opposition were in agreement that the tour went or the rotor went Conservative, Liberal, Bloc, Liberal, NDP, Liberal, Conservative, Liberal and it went ... At the end of the day, then each ... the total amount of opposition would equal the total amount of Liberal members.

The Chair: Okay, this is a debate I would rather have had at the steering committee and because the Public Accounts Committee is a committee of accountability ... 

Mr. Gauthier, would you let the Chair speak. 
I'm getting frustrated.

Now I said I would rather have this debate in the steering committee and that this is a committee of accountability and that it's not a policy committee like the other committees. The other committees normally have one government member, one opposition back and forth and back and forth. This is the accountability committee and the opposition parties therefore have been given over many many years extra opportunity to ask questions. That is why when you add up the minutes for the government side and the opposition side, it doesn't always exactly equal. 
Now I'm just going to ... before we get into any discussion, heated discussion I'm just going to say we'll still continue on the way we did, eight minutes and that is it. 
[Français]
M. Odina Desrochers (Lotbinière-L'Érable, BQ): On a un avis de motion.

M. Michel Gauthier: Monsieur le président, je désire soulever une question de règlement, s'il vous plaît. Monsieur le président...

Mme Marlene Jennings: On veut utiliser le temps.On nous a dit qu'on perd du temps, et là, ce sont eux qui sont en train de faire perdre du temps.

M. Michel Gauthier: Monsieur le président, est-ce que vous m'accordez la parole sur une question de règlement, s'il vous plaît?
[English]
The Chair: 
Mr. Gauthier....
[Français]
M. Michel Gauthier: Monsieur le président, je regrette...
[English]
The Chair: Mr. Gauthier, before you speak, I will speak. I said this is a committee of accountability. This is not a committee of partisan politics. There are more issues for us collectively to investigate rather than one party's position versus another party's position. I'm not interested in allowing this committee to become a partisan committee that's divided between opposition and government. I will not have that.

If this country is to be served by this committee, it is because we are after the facts, nothing else. I will not take this kind of intervention so that we divide down partisan lines.

I'm just going to move on.

Mr. MacKay, you have the floor. Eight minutes.

Mr. Peter MacKay (Pictou-Antigonish-Guysborough, CPC): Thank you, Mr. Chair.

Mr. Gagliano, Mr. Fournier, welcome back.

Mr. Gagliano, yesterday you spoke of irregular contacts with Charles Guité. You indicated that you met with him a couple of times annually.

My question is, did you speak to him on the phone, did you communicate with him through other individuals, did you meet with him on a much more regular basis, as was suggested by others, as much as weekly through any form of communication? 

Hon. Alfonso Gagliano: Mr. Chairman, what I said yesterday is that according to my recollection.... I want to state the fact that I didn't consult my agenda because I don't have that document in my possession, so therefore I went from recollection and I said an average of three or four times a year.

I also said yesterday that Mr. Guité would call for an appointment to see me. I don't recall asking Mr. Gauthier to see me. That's my recollection. And here I'm going again by recollection. I don't have my agenda to support...or where I can count the times that I met...

¿ (0930) 
Mr. Peter MacKay: Mr. Gagliano, with respect, that's not my question.

My question is, did you meet or did you take phone calls from Mr. Guité on a much more regular basis than these face-to-face meetings?

Hon. Alfonso Gagliano: No. During my time I could have, maybe, received one or two calls from him, but I wasn't taking regular calls from Mr. Guité.

Mr. Peter MacKay: Did he meet with your staff on a regular basis?

Hon. Alfonso Gagliano: I, as a minister, and my staff, receive representation from members of Parliament, mayors, event....

Mr. Peter MacKay: I'm talking about Mr. Guité.

Hon. Alfonso Gagliano: Let me explain the relation between Mr. Guité and my office. We were receiving representation in terms of events to advance their cause. Our role was, as a member of Parliament, to receive representation from their constituency, bring it to the minister, and the minister would transfer those representations to the bureaucrats.

Mr. Guité, being the director executive of the program...so my office would communicate with his people.

Mr. Peter MacKay: So it's possible that Mr. Guité met on a more regular basis with your staff than he did with you. Would you agree with that?

Hon. Alfonso Gagliano: Yes, it's possible.

Mr. Peter MacKay: Mr. Gagliano, did you meet with a Claude Boulay, owner of Groupe Everest?

Hon. Alfonso Gagliano: I met with Mr. Boulay and Mr. Guité once in my office at the centre block.

Mr. Peter MacKay: One time only?

Hon. Alfonso Gagliano: Yes, with Mr. Guité present and my executive assistant present.

Mr. Boulay was responsible for the Attractions Canada project. That project was up for renewal a few months after, and he came to present to me the work of the project. Specifically he presented to me that summer the campaign he had with Tim Hortons where, I remember, Tim Hortons' places would have table mats with questions about the history of Canada and so on.

Mr. Peter MacKay: Who was the executive assistant present for that meeting?

Hon. Alfonso Gagliano: I had only two executive assistants as the Minister of Public Works; therefore, it would be--I don't remember the exact date, which year--either Mr. Pierre Tremblay or Mr. Jean-Marc Bard, one of the two.

Mr. Peter MacKay: At that meeting with Mr. Boulay, the one time that you met at your office, did you have any discussions over sponsorship funding?

Hon. Alfonso Gagliano: No. He was just coming to brief me and present me with this project. Definitely, like I said, this project would be coming for up renewal in two months from that meeting, so he was making the pitch that the project was very good and was serving the objective of the program at Tim Hortons, a very popular coffee shop, where people would go out for coffee and doughnuts and would read about Canada's history and so on.

Mr. Peter MacKay: 
Did you ever meet with a Jean Lafleur of Lafleur Communication?

Hon. Alfonso Gagliano: On sponsorship issues?

Mr. Peter MacKay: Yes, on sponsorship issues. 

Hon. Alfonso Gagliano: No, I met--like the Chairman asked me the question--Mr. Jean Lafleur was part of an official trip that I did in Italy, I believe in 1999. 
Mr. Peter MacKay: That's the only time you ever had any contact with Mr. Jean Lafleur? The only time--

Hon. Alfonso Gagliano: Yes. 

Mr. Peter MacKay: Did you ever meet with a Jean Breault, owner of Groupaction?

Hon. Alfonso Gagliano: Yes, twice. Again, with Mr. Chuck Guité and I believe--and I'm not sure if it was in both meetings or in one meeting--was the presence of 
Mme Miriam Bédard. 

The first time he came with Chuck Guité to present me the ads, video, for the Nagano Olympic Games and the second time he came--and at that meeting I'm sure that Mme Bédard was present with Mr. Breault--and they came to present me and Chuck Guité a project where they would have video cassettes for elementary or high school students talking about the importance of sports so they could stay away from drugs, so--
¿ (0935) 

Mr. Peter MacKay: So Mr. Gagliano, just so I'm clear, to recap your evidence, you admit to meeting with Claude Boulay on one occasion; Jean Breault, twice; and Jean Lafleur on one occasion--

Hon. Alfonso Gagliano: Yes. 

Mr. Peter MacKay: --and at no time did you discuss sponsorship programs with any of those individuals, or their officials?

Hon. Alfonso Gagliano: Except those projects they went to see me about. 

Mr. Peter MacKay: And these meetings were at your office?

Hon. Alfonso Gagliano: Yes. 

Mr. Peter MacKay: And you never met with any of those three individuals elsewhere at any other time?

Hon. Alfonso Gagliano: Oh, I must have met in official events, social events or, for example, inviting where there were fundraising activities. I would be the speaker so I would say hello, shake hands, but we never discussed sponsorship--

Mr. Peter MacKay: But you never discussed sponsorship at any time. 

Mr. Gagliano, you said yesterday in your testimony, your presentation,
A minister does not run his department. He has neither the time nor the freedom to do so

I want to refer you, sir, to a response that you gave in the House of Commons on May 14 in reference to these sponsorship programs and you said at that time,
I repeat that all those contracts and the contracts that the hon. member makes reference to are given in a competitive process. If the hon. member is ready, my officials are ready to give him a briefing on how we do procurements for communication contracts, which might be a little different from the others, but that is the system everybody uses.

What did you mean by that?

And I want to refer to one other response to a question that you gave in the House of Commons on the procurement contracts for the helicopters, and you were Public Works Minister at that time and that fell under your purview. Again, it was a question about awarding of contracts. You said, in reference to this, 
Mr. Speaker, I always give directions to my deputy. I have been doing it since I have been a minister and I will continue to do so.

Those statements that you gave in the House of Commons seem contradictory to the evidence that you gave yesterday. You said that you didn't give direction to your deputy ministers or those under you, that you didn't have the ability to control your department. 

You also made reference to a very specific issue of how contracts were awarded and I wanted to give you the opportunity to explain those contradictions to the committee. 

Hon. Alfonso Gagliano: Well, on the last answer on... I assume you're quoting from Hansard, and--

Mr. Peter MacKay: Yes, I am. 

Hon. Alfonso Gagliano: --you're quoting Hansard so I don't know what the question was. But let me say when you say that contradicts my testimony, definitely yesterday my testimony I said that once I learned--first of all I asked for the internal audit in 2000--therefore I directed my deputy minister. 

Secondly, when I found in that audit there were serious administrative problems, I directed them to give me a plan of action. I directed them to have a new competition of the communication agency. I directed my deputy minister and directed the executive director of the Canadian Information Office to meet and start negotiations so that it could be transferred--all the CCSB, all the branch of the coordination and communication service--to another department, so that would be--

Mr. Peter MacKay: So, you're telling us today you were a very active minister.

Hon. Alfonso Gagliano: Well, when I was informed that there were problems, what I said yesterday and if you go back to my statement, when I knew there was a problem I took action. 

But one, I didn't know there was a problem. I was powerless because--

The Chair: Okay. Thank you, Mr. Gagliano. Before we move on--

Hon. Alfonso Gagliano: Mr. Chair, there was another question. Sorry, I'm in your hands.

The Chair: Before we move on, I omitted to say that the blues from all day yesterday are now available and the clerk is now distributing them.

Also, yesterday, remember we made mention to guidelines for ministers, the 2003 edition is available in both official languages and we have made a request for the previous editions and when they are available they will be distributed and tabled.
[Français]
Monsieur Gauthier, huit minutes s'il vous plaît.

M. Michel Gauthier: Merci, monsieur le président.

Bonjour, monsieur Gagliano. Hier j'ai écouté votre comparution et vous avez dit à un moment donné que vous avez rencontré Everest et Groupaction avant la campagne de 1997, vous les aviez invités à participer, je crois, à un consortium d'agences de publicité. C'est bien exact?

L'hon. Alfonso Gagliano: Oui.

M. Michel Gauthier: Je voudrais savoir, monsieur Gagliano, ont-ils effectivement participé à l'élaboration de la campagne?
¿ (0940) 
L'hon. Alfonso Gagliano: Oui.

M. Michel Gauthier: Je voudrais savoir, monsieur Gagliano, est-ce à ce moment-là, parce qu'il y a eu des reportages où quelqu'un déclarait que vous aviez été vu chez Groupaction.

L'hon. Alfonso Gagliano: Oui, par la porte d'en arrière.

M. Michel Gauthier: Oui. C'est à ce moment-là, au moment de la préparation de la campagne?

L'hon. Alfonso Gagliano: Oui, c'était la fois où je me rappelle avoir été chez Groupaction, où j'ai été aussi chez Everest à ce moment-là et vous connaissez la rue Sherbrooke.

M. Michel Gauthier: Merci. Non, non, je connais.

L'hon. Alfonso Gagliano: Je suis entré par en arrière en auto.

M. Michel Gauthier: Je connais la façon dont cela fonctionne, je vous remercie. 

Monsieur Gagliano, concernant le fameux rapport de Groupaction qui a été commandé une fois, fait, commandé une deuxième fois, une troisième fois et jamais remis, étiez-vous au courant qu'on commandait ce rapport-là à Groupaction?

L'hon. Alfonso Gagliano: Non, je n'ai jamais été au courant qu'on commandait ce rapport et moi je l'ai appris la première fois--d'ailleurs j'ai été questionné en Chambre sur un des rapports--et je ne savais pas qu'il y en avait deux autres et bien sûr une fois que je suis parti j'ai lu dans les journaux ce qui est arrivé pour le reste. 

M. Michel Gauthier: D'accord. À ce moment-là...

L'hon. Alfonso Gagliano: Je n'ai jamais demandé ce rapport. J'aimerais expliquer, monsieur le président, une minute, la délégation de pouvoirs pour un ministre dans un ministère. Quand je suis arrivé au ministère on a discuté de la délégation des pouvoirs et M. le ministre m'avait présenté une délégation des pouvoirs dont je déléguais tous mes pouvoirs de signature au sous-ministre et ma réaction a été: " qu'est-ce que je fais ici, vous n'avez pas besoin d'un ministre si vous signez tout ". Et finalement après une couple de semaines de négociations avec mon bureau et le bureau du sous-ministre on s'est entendu avec une délégation de pouvoirs de signature que tout contrat de 10 millions de dollars jusqu'à 20 millions de dollars--parce qu'à partir de 20 millions de dollars je devais aller devant le Conseil du Trésor--venait à moi, je pouvais l'analyser, signer tout contrat en bas de 10 millions de dollars. Définitivement je n'avais aucune...c'était délégué au sous-ministre qui, lui, déléguait l'autorité au sous-ministre adjoint et au directeur général des achats. Je pense que c'était très important qu'on discute de la responsabilité ministérielle, il faut regarder aussi la délégation des pouvoirs.

M. Michel Gauthier: Oui. Monsieur Gagliano, il ne vous est pas apparu donc que les fameux rapports ont été commandés vraisemblablement par M. Guité, autorisés par votre sous-ministre, c'est ça?

L'hon. Alfonso Gagliano: Je ne suis pas au courant si mon sous-ministre n'était pas au courant. Je crois que M. Guité dans la délégation des pouvoirs avait assez de délégation au pouvoir de commander.

M. Michel Gauthier: Pour commander ces rapports-là.

L'hon. Alfonso Gagliano: Le rapport de 500 000 $, définitivement le directeur général...

M. Michel Gauthier: Il ne vous est pas...
[English]

The Chair: If I can just interrupt, and I do apologize for interrupting, but I would like to read to Mr. Gagliano, our witness, again for the edification of the entire committee, from the Department of Public Works and Government Services Act the powers, duties and functions of the minister. It is number 6.

The powers, duties and functions of the Minister extend to and include all matters over which Parliament has jurisdiction, not by law assigned to any other department, board or agency of the Government of Canada, relating to
among other things
acquisition and provision of services for departments;

I will continue by reading subsection 7(1), under exercise of powers. It says:

In exercising the powers or performing the duties or functions assigned to the Minister under this or any other Act of Parliament, the Minister shall
among other things
acquire materiel and services in accordance with any applicable regulations relating to government contracts;

You may have delegated your authority, Mr. Gagliano but you're not absolved of the responsibility is the point we are saying. Under the legislation you do have the responsibility even if, though, you delegated it. Mr. Gauthier, you may continue.
[Français]
M. Michel Gauthier: Monsieur le président, j'avais l'intention d'aborder la responsabilité ministérielle moi-même et je le ferai ultérieurement. Alors, je continue mon questionnaire. 

Monsieur Gagliano, est-ce qu'il ne vous est pas apparu un peu particulier que les deux firmes de communication, qui ont fait la campagne électorale du Parti libéral en 1997, fassent un rapport en 1996-1997, qui avait été commandé, ils l'ont déposé, ils ont été payés pour l'ouvrage qu'ils ont fait... Encore qu'on pourra discuter du prix. Mais ce n'est pas cela l'objet de mon propos. Mais est-ce que cela ne vous semble pas curieux que M. Guité ait eu la bonne idée, l'année suivante, quand ils ont collaboré à votre campagne électorale, de recommander un rapport à 525 000 $, qui n'a jamais été déposé--il n'était tellement pas utile qu'il n'a jamais été déposé et que personne s'en était aperçu--et de recommander, l'année suivante, un autre rapport qui n'était tellement pas utile qu'il n'a jamais été déposé, et que personne ne s'en est aperçu, toujours à cette firme-là? Est-ce que vous ne trouvez pas qu'il y a au moins, le moins qu'on puisse dire... C'est un peu normal que les parlementaires et les citoyens s'inquiètent que deux firmes proches du Parti libéral, mais une notamment qui a fait la campagne électorale, l'année suivante, se voient repayées deux fois 500 000 $ pour déposer un rapport qui n'a jamais été déposé. Est-ce que cela ne vous apparaît pas curieux que M. Guité ait pris une décision comme celle-là?
¿ (0945) 

L'hon. Alfonso Gagliano: La seule chose qui est curieux dans le sujet dont on parle dans tout le système des commandites, et j'espère qu'un jour on fera le lien... Mais, moi, je peux vous dire que si vous regardez les dates des rapports qui ont été commandés, je pense qu'il y en a deux qui ont même été commandés avant que j'arrive au ministère. Comme je vous dis, je n'étais pas au courant que ces rapports-là avaient été commandés. Je n'étais pas en connaissance de ce fait-là. Je l'ai appris après, et si vous regardez dans le hansard, j'ai été questionné là-dessus quand j'étais encore ministre, je crois à l'automne 2001, et, à ce moment-là, j'en avais appris un. Souvent, les ministres sont briefés quand ils lisent les journaux. Alors, il faut briefer les ministres parce qu'ils doivent répondre aux questions en Chambre. Dans ce cas-là, c'était vraiment le cas.

M. Michel Gauthier: Monsieur Gagliano, M. Guité en porte large sur ses épaules. Mais en août 1999, heureusement pour tout le monde, il a pris se retraite, pas en août 1999, avant cela, en 1999, au début de l'année, il a pris sa retraite et il a été remplacé par intérim par votre chef de cabinet. Le chef de cabinet, c'est la personne la plus proche de vous. Est-ce que vous diriez qu'au moment où Pierre Tremblay a été responsable du programme que vos contacts ont été plus fréquents qu'ils ne l'ont été avec M. Guité, dû au fait que c'est un de vos collaborateurs immédiats et qu'il avait participé dans le fond et aux discussions politiques, d'une part, et aux décisions administratives, de l'autre part?

L'hon. Alfonso Gagliano: Je dirais que les discussions étaient moins fréquentes avec M. Tremblay qu'elles ne l'avaient été avec M. Guité, justement pour cette même raison, parce qu'il venait justement de mon cabinet. Si vous voulez, je vais vous expliquer comment l'emploi comme fonctionnaire de M. Tremblay s'était fait. Je pense que c'est important que les Canadiens le connaissent.

M. Michel Gauthier: Il a passé par le processus? Parce que mon propos... Je ne mets pas cela en doute, monsieur Gagliano.

L'hon. Alfonso Gagliano: Non, mais je voulais savoir. Si vous mettez cela en doute, je peux vous l'expliquer.

M. Michel Gauthier: Non, je ne le mets pas en doute. Il a passé par le processus. 

L'hon. Alfonso Gagliano: D'accord. Parfait.

M. Michel Gauthier: Ce qui m'inquiète particulièrement, monsieur Gagliano, c'est que j'ai ici la liste des fameux scandales des commandites, et depuis que M. Tremblay est en fonction, il y en a eu--si j'avais le temps, si j'avais 15 minutes, je pourrais vous en citer--, il y a eu plusieurs exemples de scandales qui ont continué. Comment expliquez-vous que votre chef de cabinet, qui était là pour vous protéger politiquement--c'est normal, on connaît le rôle d'un chef de cabinet, j'en ai un et c'est ce qu'il fait--, votre chef de cabinet, qui connaissait votre grand souci d'avoir un programme qui fonctionne bien, dans le respect des règles, du moment où il vous quitte de façon tout à fait correcte pour aller occuper une responsabilité comme celle-là, continue de plus bel? Et on peut l'appeler le digne successeur de Guité. Aurait-il oublié tous vos soucis politiques ou vos soucis de justice ou vos soucis de bonne administration, surtout que vous ne lui parliez plus? J'ai de la misère à comprendre que, tout à coup, il aurait oublié la façon dont vous vouliez fonctionner au ministère, avec un souci d'équité, qu'il serait devenu fonctionnaire et, là, il serait embarqué de plus bel et il aurait été influencé par M. Guité, avec lequel il n'était pas absolument proche, j'imagine.
L'hon. Alfonso Gagliano: Disons que je ne peux pas savoir quelle était la relation que M. Guité et M. Tremblay devaient avoir.
Le président: C'est votre question finale, une brève question.

L'hon. Alfonso Gagliano: Alors, quand M. Tremblay a postulé pour le poste, ce n'était pas le poste de directeur exécutif. Il y avait un poste vacant et il a postulé pour ce poste-là qui était engagé.

M. Michel Gauthier: Ce n'est pas le sens de ma question, monsieur Gagliano. A-t-il oublié tous vos principes, vos soucis de bonne gestion lorsqu'il est devenu directeur du Programme, étant donné qu'il a continué comme M. Guité.

L'hon. Alfonso Gagliano: Je ne peux pas porter de jugement là-dessus. Alors, je pense qu'il faudrait poser la question à M. Tremblay. Cependant, je peux vous dire que lors du rapport de la vérification interne de 2000, le vérificateur me l'avait souligné. Depuis l'arrivée de M. Tremblay à la direction de ces programmes, il avait commencé à apporter des améliorations, qui ont pris du temps. Le vérificateur interne a confirmé que M. Tremblay avait commencé à apporter des améliorations dans le programme.
Le président: Merci beaucoup, monsieur Gauthier.
[English]

Mr. O'Reilly, please, eight minutes.

Mr. John O'Reilly (Haliburton-Victoria-Brock): Thank you very much, Mr. Chairman.

This reminds me of the 1997 Auditor General's report and some of the work that went on with public accounts, since you became chair. I remember being vice-chair of that committee at the time and I think it was Mr. Nunziata who tried to take it over. He thought he should be chair. So I congratulate you on your longevity, Mr. Chairman.

I thank Mr. Walsh for his intervention. I didn't get a chance to ask questions yesterday of the witness, but having read his report and reflected on what went on yesterday, I certainly have some questions. I have six points, actually.

Of course accountability is the main issue and I think it's the main issue of conversation. It's like the weather, you know; when the weather is good we take responsibility for it and when it's bad we blame the Reform Party. And the same with employments figures; when employment figures are good the government takes credit and when they're bad we blame it on somebody else's economy. So there's a belief factor here that seems to be missing. And my first question is how can a minister of the crown not be responsible for the department? Because over and over again we are told that ministers of the crown are responsible. When things go well they take credit and when things go bad they blame it on someone else or it's always someone else. So that would be my first question. But, before you answer it I'm going to go through my six points and then you can deal with them at your time.

The word "scandal", you've used it in your report three or four times, I didn't see the word "scandal" in the Auditor General's report so I wonder that if you used it in your report you must believe there is a scandal. So I'd want to know, is this a media word, an opposition word or something that you've picked up on? I would like to know why you used the word?

My third point is the direction. I want to know, did you give direction on policy? Did you intervene personally in the awarding of contracts?

My fourth question is did you talk directly to the ad agency firms, particularly Groupaction, which you have indicated you have? I want to know how you directed them? 

And on page nine, it's interesting that you indicated that there was criminal activity going on and you wanted to call the police, but you were told it was administrative. So I want to know who gave you that advice and I want to know why you took it and why you didn't take action and why you didn't call the police?

And then I also want you reaction on your satisfaction or disappointment in the fact that there were many things said in the House of Commons, where members are privileged and can say almost anything they want in question period. And I didn't go over them, but I did brief on some of them. They've accused you of almost everything, but being human in their derogatory statements in question period. And I think that's what's fed the media frenzy. And this has become a media frenzy driven by the opposition and driven by, obviously, the media who are enjoying it very much as you witness by their presence here.

So those are my six points, Mr. Gagliano, and I would ask you to respond to them.
¿ (0950) 

Hon. Alfonso Gagliano: Mr. Chairman, I'm going to try. I took them down as fast as I could.
¿ (0955) 
Mr. John O'Reilly: I'll remind you.

Hon. Alfonso Gagliano: I'm going to do my best to answer them.

The responsibility, what I said in my testimony, my statement yesterday, is that as a minister responsible--and I never denied my responsibility as the Minister of Public Works and Government Service--I was trying to explain how far the responsibility goes. I think there is a lot of documentation and I alluded to it, and the Auditor General's report, chapter 2, I think, when she speaks a lot about it. 

I'm sure that this committee and the government will have to have a very interesting debate to redefine things as far as ministerial responsibility goes.

The point I tried to make yesterday, when I knew that there was a problem, I acted immediately and I took action and the problem was corrected. This was recognized by the Auditor General. When I didn't know, I could not take action to fix something that I didn't know was broken. That's what I'm trying to explain to the committee and all Canadians.

In terms of the word "scandal", frankly, I took that word because that's what everybody is saying, so I used this word that you read practically on the lips of all the media and on the lips of most or all of the opposition parties. So, that's my answer.

In terms of direction that I gave, I think I was clear yesterday--yes, directions on policy. The policy was that we had to have visibility, timely visibility. We were talking about sports events, festivals, a lot of activities that happen in a timely fashion, and also living in a very, very competitive environment because we had the Government of Quebec of the time that didn't want us to be anywhere in Quebec as a federal government. But I only gave policy direction. Yes, we discussed events, but never got involved in the contracting, management, the agencies' management--that was the bureaucrats.

In terms of giving direction to agencies, no. Like I said this morning, in answering a question, I met the agency specifically, in which occasion they came to present--if I can use the word, they came to "pitch"--their case, that specific event. I listened, then I said "Thank you very much, I'll be definitely talking". In one case, I even said I don't think the sponsorship program is the forum for this, there are other programs in Health Canada or Justice that could do that project, and that's it.

In terms of why I didn't call the police, my first reaction, when I heard the interim verbal reports of the internal auditor, was, "Should I call the police?". They said no, the internal auditor said no, there is no evidence of any criminal doing, it's just a management problem. Therefore, I went to address, and I directed them to give me, a management plan to correct the problem.

I agree with you, I've been called the "master mind" of all this sponsorship file. I would like to remind everybody that the sponsorship file was created before I was the Minister of Public Works, and the new rules, the new Treasury Board guidelines to have the procurement and communications services together, were put in place in July 1994 when I wasn't even in cabinet.

The Chair: A very brief question, Mr. O'Reilly.

Mr. John O'Reilly: When Minister Boudria inherited that file, I think the only official act he did was open a building on Sparks Street, the Darcy McGee Building. Then he was found to have stayed at somebody's cottage and he was immediately dismissed. If in fact that's true, that was his only sin of staying over a weekend, then, you know, I would have to ask you if you have ever stayed at any of the Irving-cottage types of places, or places that are owned by the people who are involved in the sponsorship program?

Hon. Alfonso Gagliano: No. As a matter of fact, I have to say that I was invited to Mr. Boulay's 50th birthday, and I declined the invitation because I was the Minister of Public Works, and I knew that he was doing business with the government, and I felt that as a minister it was not proper to be there.

The Chair: Thank you very much, Mr. O'Reilly.

And, Mr. Gagliano, you mentioned that how could you take action when you didn't know, but you were a minister of the crown, and under responsible governments ministers take responsibility for all actions of all civil servants in your department. I would have thought that when you had come here the first thing that you would have done was accepted that responsibility, even although you didn't know what was going on, or you say you didn't know. As a minister of the crown, reporting to Parliament, you had the responsibility to accept that responsibility, which you have not done. You keep saying how could I accept responsibility when you didn't know. Under responsible government theory, you had an obligation to come to this committee and accept that responsibility.

Ms. Wasylycia-Leis.

Hon. Alfonso Gagliano: May I answer to that, Mr. Chair.

À (1000) 
The Chair: Yes.

Hon. Alfonso Gagliano: First of all, let me, with due respect disagree with you. As that responsibility you speak about, you release it, it's the Prime Minister who deals with doing that, and usually in a case like this the Prime Minister may ask the minister to resign as a minister. When this came out in 2002, I was no longer a minister. Secondly, when I came to this committee I thought that the committee wanted to know what was my role, and what happened to this file, and that's what I've been doing.

The Chair: Absolutely correct, Mr. Gagliano. And part of that is to come to this committee, and accept the responsibility of what happened in your watch as a minister of the crown, in your department, and you had that obligation to say that to this committee.

Ms. Wasylycia-Leis, eight minutes, please.

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

Let me ask some questions pertaining to developments which fell directly in the period when you were Minister of Public Works. Let me ask some questions to set the stage. You were the Minister of Public Works between June of 1997 to January 2002. Correct?

Hon. Alfonso Gagliano: Yes.

Ms. Judy Wasylycia-Leis: Under your direction during that time you were responsible for the communications coordination services branch. 

Hon. Alfonso Gagliano: Yes.

Ms. Judy Wasylycia-Leis: During most of this time you had the Canada Information Office as part of that branch, correct? You were the--

Hon. Alfonso Gagliano: The Communication Information Office is a totally separate department.

Ms. Judy Wasylycia-Leis: But the Canada Information Office became a part of your department, Department of Public Works, in June of 1998. Correct?

Hon. Alfonso Gagliano: Part of my portfolio, not department.

Ms. Judy Wasylycia-Leis: Yes, your portfolio. Thank you.

You were the chair of the communications committee of cabinet, and you were assigned chief political minister for the province of Quebec in your government. Okay.

Let me start by asking you the following. In March of 1998 Media IDA Vision, which is an affiliate of Group Everest, owned at the time by Mr. Claude Boulay, who's the former communications director for the Prime Minister's 1990 leadership bid. Media IDA Vision was appointed the agency of record for the federal government. That was, I think, the process which culminated in March, 1998, and the contract was signed on April 1, 1998, and over the next five years $435 million of government advertising was placed through that agency, making it one, if not the most lucrative advertising contracts in Canada, and you will know from your reading of the Auditor General's report that she has found numerous irregularities in the awarding of that contract.

So I want to ask you, given that this is the most important advertising contract that your department, and you as a minister, would issue during your tenure, can you tell me what criteria were used by your department in selection Media IDA Vision?

Hon. Alfonso Gagliano: First of all let me say that I learned that Media IDA Vision agency was chosen for what is called in language here in Ottawa the agency of record by the media, and I definitely was surprised that such an important contract as minister I was not briefed. I asked questions, and I was told then by Mr. Guité that this was a competitive bid, that there was a selection committee, that there were members of the committee that came from the industry, members of the committee that came from the other departments, and that he chaired himself that selection committee, and the selection was regular and normal. So I got my answer to my questions, and then like I said, this is before spring 2000. I had no reason of doubting his word, his briefing.

Ms. Judy Wasylycia-Leis: The selection committee for this contract included members of your department. Was there no communication between you and members of your department for whom you have responsibility?

Hon. Alfonso Gagliano: No. I was told this competition was handled by CCSB according to Treasury Board guidelines, they had that authority. The competition rules were applied and it was put on the--

Ms. Judy Wasylycia-Leis: This was a process, under you as minister, and it involved employees from your department, and your department oversaw the selection process. You knew nothing and you found out about it through the media?

Hon. Alfonso Gagliano: Yes and right after I asked questions and I got the report about which I just told you that this was done completely and the selection--
À (1005) 

Ms. Judy Wasylycia-Leis: You asked questions, you say, and then in 2000 we have the audit which verifies in fact the irregularities were occurring. It's a very strongly worded report saying the process did not meet the requirements of Treasury Board policies and government contracts. That's in the year 2000.

Hon. Alfonso Gagliano: That's after.

Ms. Judy Wasylycia-Leis: Right. You did nothing to change the process, so the contract continued and in fact you would have begun the renewal of that contract, or the extension of the contract for Group Everest, or Media IDA Vision, during your tenure as minister even though you knew of these concerns because you in fact say you wanted this audit done.

The audit points out the irregularities. You still did nothing. It went on, and in fact, to this day, Group Everest or Media IDA Vision, still has this lucrative contract--the most lucrative contract in the Government of Canada.

Hon. Alfonso Gagliano: Let me answer that question. I did something because definitely my intention was I would have liked the other agencies to have that contract put into competition again and I was told that a legal opinion was, even though the internal audit was critical of the way the selection was done, but legally it was not necessarily enough to cancel that contract, go to competition and risk a law suit that would cost a lot of money. Again, I acted under those recommendations I received from officials.

Ms. Judy Wasylycia-Leis: Okay. You're the minister. You're the chair of cabinet committee dealing with communications where this whole contract would have been discussed and irregularities would have been discussed, but your hands were tied. You could do nothing. So you can't explain how so many irregularities would have happened while you were minister, because it was out of your hands.
You can't explain that.

Hon. Alfonso Gagliano: I explained. There was an internal audit report and when it came, the question of recomp(inaudible) Media IDA Vision, we got the opinion, I got the information that legally we could have been damaged and the recommendation was that we would continue.

As you said, until now, I think even the present government has continued with them because there is a question of a legally-binding contract even though the auditor said the spirit of the letter of the policy was not fully implemented.

Ms. Judy Wasylycia-Leis: Could you tell us, during your tenure as minister, what percentage of overall government advertising money was given to GroupAction, Group Everest, Gosselin, Lafleur and other Quebec-based agencies mentioned by the attorney general? Also, could you tell us as minister and as the chair of the cabinet committee on communications, were you not aware that a disproportionate amount of federal government advertising was going to Quebec-based agencies, particularly those mentioned in the AG report? 

Could you tell us that of those agencies how many played a part in the advertising consortium that handled the Liberal Party advertising during the 1997 election and the 2000 elections? Could you tell us whether or not any of these agencies, or associates of these agencies, contributed funds or services in any kind, to your own election campaigns in 1997 and 2000?

Hon. Alfonso Gagliano: Two things, Mr. Chairman, I'm going to try to answer them in order.

First of all I was briefed that there was, in 1994 Treasury Board guidelines, there was a provision that no communication agencies should received more than, I believe, 25% of the advertising business from the Government of Canada and I only learned in the internal audit, that I believe one or two of those agencies had surpassed that 25% ceiling.

In terms of the donation, yes, two agencies accepted. Others were invited to the consortium and only two agencies accepted, GroupAction and Group Everest.
Thirdly, did they contribute directly to my own campaign? I couldn't find a copy of my 1997 election return from my riding. I checked and I have a copy of the 2000 chief electoral report but I didn't see any contribution from any communications agency to my re-election campaign in 2000. Again, in 1997, I couldn't put my hands on that report.
À (1010) 

The Chair: So that is not a specific statement that there was no contribution to your campaign?

Hon. Alfonso Gagliano: In 2000, I checked in 2000--

The Chair: But for 1997?

Hon. Alfonso Gagliano: I don't know. I still have to put my hands on the election records.

The Chair: I want to get back to this ministerial responsibility, and I'm still frustrated, Mr. Gagliano. Yesterday, you said in your opening statement, "A minister does not run his department, he has neither the time nor the freedom to do so".

I just quoted from the Department of Public Works and Government Services Act. 

Are you familiar with your responsibilities as a minister under the Department of Public Works and Government Services Act?

Hon. Alfonso Gagliano: Yes.

The Chair: You are. Okay.

Now, I understand that when a minister is appointed, he or she receives a letter from the Prime Minister, which is sometimes, I believe, called "instrument of advice". Did you receive such a letter from the Prime Minister?

Hon. Alfonso Gagliano: Yes, and I mentioned yesterday in my opening statement in that letter it stated that my deputy minister is the principal adviser of me as a minister, and I should work diligently and very closely with him. That's what I was meaning yesterday in my statement.

The Chair: You will note, of course, he's an adviser, he doesn't take responsibility. Is it possible for us to get a copy of that letter?

Hon. Alfonso Gagliano: It could be in the department. There is a ministerial correspondence section in the Department of Public Works. All my files remain there, but I'm sure the PCO.... This letter was, I believe, drafted by PCO, so PCO must have a copy.

The Chair: We'll pass a motion next week asking for a copy of that letter.

Mr. Kenney please, eight minutes.

A point of order, Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: I didn't get answers to a couple of these questions. I'm just wondering if I could, through you, request that we get answers from the witness pertaining to which of these agencies that I referred to played a part in the advertising consortium, which handled the Liberal Party advertising in 1997--

Hon. Alfonso Gagliano: I answered--Everest and Groupaction. I answered that.

The Chair: He says he gave us his answer, and if it was not a fulsome answer. We've been talking about lack of fulsome answers, but the answer will stand at this point in time, until we find--

Hon. Alfonso Gagliano: Mr. Chairman, I gave the answer, and I'm willing to repeat--it's Everest and Group Action. Those are the two agencies.

The Chair: As I say, that's his answer.
Mr. Toews.

Mr. Vic Toews: On the same point of order, for all of those questions, I found the answer remarkably short. I'm wondering whether this witness be given the opportunity to consider everything that was put to him and see whether or not he has additional information that he can share with this committee and bring that forward in writing to this committee, Mr. Chair.

Secondly, I would also like to see the returns on the election contributions, both 1997 and 2000. These issues have been directly brought up in the testimony here today. I think that we should be able to examine those.

The Chair: In response to the first point that Mr. Toews and Ms. Wasylycia-Leis raised, the witness always has the opportunity, every witness, this particular witness has the opportunity to review the blues and provide further information to this committee if they feel that is warranted.

Your point on the donations to the 1997 and 2000 elections. It is a matter of public record. The clerks will have it and deliver it to the committee.

Mr. Tonks.

Mr. Alan Tonks: Could we use this as an illustration, since Mr. Toews...just getting back to what Mr. Walsh said in relation to this committee's role? May I ask, Mr. Walsh, is what Mr. Toews asked for relevant with respect to the overview that you gave us? I think we should, in terms of ministerial responsibility. The point being whether it's on the website or not, whether it's relevant for that information that was required with respect to contributions.

The Chair: Mr. Walsh is free to answer, but I do know, and it is a matter of public knowledge, that the RCMP are investigating the Liberal Party in the province of Quebec as part of this investigation. But if you're talking to Mr. Walsh about Mr. Toews' concept that we're not getting the fulsome answers, if you don't feel that you're obligated to respond, Mr. Walsh, but if you have something to say, feel free.
À (1015) 

Mr. Rob Walsh: I feel I should point out to the member, Mr. Chair, that the question of relevancy, often a vexing one, is not one for legal counsel to determine, but one for this committee in its own good judgment to determine.

The Chair: Okay. So, we're not going to belabour that point. 

We're going to move to Mr. Kenney for eight minutes. We started with Mr. Kenney, right? Mr. Kenney, eight minutes.

Mr. Jason Kenney (Calgary Southeast, CPC): Yesterday, Mr. Gagliano, you testified to the following: 

That once Mr. Guité was gone from the department rumours started also in the air and we had the problem. So that was what really made my decision to call for internal audit and find out what was there.

What were the nature of these rumours? From whom did you hear such rumours?

Hon. Alfonso Gagliano: Well, by memory, and, again, subject to verification--I think there were even questions in the House of Commons--this was part of my decision. But, like I explained yesterday, also was the fact that we were having some problems of control in files in Human Resources and, after discussing with my deputy minister, even though sponsorship is a communication service and not a grant, a contribution, we went ahead to go and have an internal audit.

Mr. Jason Kenney: Apparently, the witness didn't hear my question, so let me repeat it.

What rumours did he hear and from whom did he hear such rumours?

Hon. Alfonso Gagliano: I said I believe--and you can verify better than me through the records--there were--

Mr. Jason Kenney: I can't verify what rumours the witness heard, Mr. Chairman.

Hon. Alfonso Gagliano: I cannot exactly recall what happened five, six years ago.

Mr. Jason Kenney: Well, yesterday, you spoke about rumours, what rumours--

Hon. Alfonso Gagliano: I believe there were questions in the House. So if you ask questions, that means you have a...so, for me, it was a concern.

Mr. Jason Kenney: I see. So the rumours were questions being asked by the opposition.

Hon. Alfonso Gagliano: I believe. It can be verified.

Mr. Jason Kenney: So the minister first heard about the problems in his department from the opposition, apparently.

Hon. Alfonso Gagliano: Well, doesn't the opposition have a very important role in our parliamentary system?

Mr. Jason Kenney: Mr. Chairman, that's just unbelievable. Mr. Chairman, yesterday, the witness--

Hon. Alfonso Gagliano: Speaking of unbelievable.

Mr. Jason Kenney: --also testified to...well, in that quote I just quoted, the witness said he called for an internal audit. But his former deputy minister, Mr. Quail, said to us, quote, "I initiated the internal audit". And, indeed, the audit says this directed audit--this is the 2000 audit--was conducted at the request of the deputy minister.

So who's telling the truth? The minister or his former deputy? Did the minister request the audit or did his former deputy initiate it?

Hon. Alfonso Gagliano: Both, Mr. Chairman.

Mr. Jason Kenney: Both. I see.

Hon. Alfonso Gagliano Yes. It's the deputy minister that requires...the deputy minister that went to the internal audit--there is a committee of audit in the department--and said, "Well, even though it's not in the plan, we want to have a audit in the sponsorship program, but I have to discuss it with the minister".

Mr. Jason Kenney: Mr. Chairman, yesterday I quoted to the witness the following statement from his former deputy minister, Mr. Quail, to us, where he said, "There was a very direct relationship between the minister and the CCSB group and, in particular, the executive director". That would be Mr. Guité.

Now, Mr. Chairman, I'm having a hard time understanding why a 43-year career public servant, who served as deputy minister of Public Works for nine years, would characterize a relationship as being "very direct" between the minister and Mr. Guité when it only consisted of only three or four meetings a year.

Does the minister agree, with...in fact, yesterday, on the record, he did agree with Mr. Quail's characterization of "a very direct relationship". So what am I missing here? Why is it I don't think two or three meetings a year constitutes "a very direct relationship"?

Hon. Alfonso Gagliano Well, again, Mr. Chairman, and I even said this morning, I recall that, on average, I would have three to four meetings a year with Mr. Guité. I had a regular meeting, for example, with my deputy minister at least on an average of twice a week. But not--

Hon. Alfonso Gagliano: May I finish?--but not with Mr. Guité.

Now, I said this morning--and I want to make it clear--before coming here, I didn't go and check my 1997, 1998 or 1999 agenda so that I could count the number. I'm going through recollect action and, to the best of my recollection, I believe that I met Mr. Guité, on his request and not on mine, about from three to four times a year, on average.
Now--

Mr. Jason Kenney: Mr. Chairman, we have that on the record.

Would the witness, again, agree with his former deputy's characterization of that as being "a very direct relationship"?
À (1020) 
Hon. Alfonso Gagliano: Well, if the deputy minister--

Mr. Jason Kenney: Well, yes or no.

Hon. Alfonso Gagliano: --felt that it was a direct relationship. Yes, I was meeting Mr. Guité and discussing, and if you read the deputy minister's testimony, he said he had the responsibility to meet him. He signed the Treasury Board document, so he had to have the information before signing. That's what Mr. Quail said.

Mr. Jason Kenney: Mr. Chairman, one of the key issues here is the difference between merely administrative problems, which the minister has referred to, and potentially fraudulent activities that have been revealed by the Auditor General.
I'd like to ask the witness the following question.

The audit revealed that there were invoices from ad agencies, quote:
...which did not provide some details in the breakdown of amounts being billed. 

Therefore, we concluded the amounts being charged were for products or services more appropriately considered management of the sponsorship, and therefore to be included in the 12% commission fee paid and not for products and services appropriate to the use of the production budget.
According to one media summary:

This means that advertising firms involved in the sponsorship programs sometimes got paid twice for the same services and topped up their invoices with the high level of labour costs.

Mr. Chairman, does the witness think that billing twice through essentially fake invoices constitutes a mere administrative problem, or would that not flag for him a potentially fraudulent activity?

Hon. Alfonso Gagliano: Definitely is not an administrative problem. It's definitely ... if I would have that information, exact information and I don't know which report you're quoting whether it's the Auditor General. If it's the Auditor General, she showed me that when she came to see me in Copenhagen. In the audit of 2000, in my briefing I was never given that there were double invoicing. What I was told was that there were documentation missing, that files were not properly kept.

Mr. Jason Kenney: So the minister would regard that as a very serious revelation. 

Hon. Alfonso Gagliano: Definitely.

Mr. Jason Kenney: Mr. Chairman, what I just quoted was the 2000 audit. I'd like to know if the minister actually read that audit.

Hon. Alfonso Gagliano: No I've been saying. I was given a verbal interim report. 

Mr. Jason Kenney: Did the minister read that audit, the 2000 audit?

Hon. Alfonso Gagliano: No I didn't read that audit. And then once I was told that there were problems, my first objective was and when I 

Mr. Jason Kenney: Mr. Chairman, the witness has testified that there were merely administrative problems revealed by that audit. Therefore police investigation was not required. The audit revealed the process of double billing, of false invoices being submitted. Why didn't the minister act on that, Mr. Chairman?

Hon. Alfonso Gagliano: Mr. Chairman, I beg to differ with the member. I acted. I didn't read the full audit. I didn't receive the summary. I got a verbal briefing with the deputy minister, with internal auditor saying that there is no criminal matter. 

It's administrative and I required a plan of action. That was my interest. I'm told there is no fraud, why should I ...

Mr. Jason Kenney: The minister was wrong. My last question.

The Chair: I think, Mr. Gagliano, that you have answered the question.
Mr. Kenney.

Mr. Jason Kenney: My last question is this, Mr. Chairman. Pierre Tremblay and Jean-Marc Barr were the executive assistants to the minister during his tenure. I believe there was also a Pierre Brodeur who was his special assistant for Quebec. I would like to know whether the minister ever gave instructions implicit or explicit to any of these senior staff members or other senior members of his ministerial staff to communicate directly with Mr. Guite regarding the administration of the program? And is he aware of regular meetings that occurred between Mr. Guite and either Jean-Marc Barr, Pierre Brodeur or Pierre Tremblay?

Hon. Alfonso Gagliano: The only instruction that I gave to my officials, my staff whether it would be between gentlemen that you mention or anybody else would be when I had representation. For example, I'll give you an example that I think everybody can understand because you're a member of the House, usually during or right after question period, a member comes and sees you and gives you a note or verbal tells, explains a representation from a project, I would take note and give to my logistical assistant and say bring it to the executive assistant to follow up. 

That were my only instruction really to make sure that the representation that I received as a minister on a specific file was followed to the officials in the department.

À (1025) 

The Chair: Okay, before we move to Mr. Gauthier.

Mr. Gagliano again, Mr. Kenney asked you specifically about an audit that you say you were given a verbal briefing on, that you didn't read, even though you were advised presumably that there was criminal activity, of false invoicing and so on going on. 

Will you not accept that you as the minister of the time have a responsibility, to accept the responsibility for what happened in your department and that if you didn't take the time to read serious accusations and an audit that you were culpable?

Hon. Alfonso Gagliano: Well at that time, when I received the briefing, this was an interim report. 

The Chair: But you were told what was in there.

Hon. Alfonso Gagliano: Right away, right away in the middle of the audit, as soon as they realized there were problems, they asked to meet me with the deputy minister and other officials from my office of the department and gave me a briefing. At that time, when I asked the question, should I call the police? They said no, there's no criminal involvement. We believe that it's administrative. So I said well let's have a plan of action, correct immediately all the administration and I've been telling you since yesterday the actions that I took. 

The Chair: I know the actions well. I know what you've said about the actions but my question is, don't you feel as a minister of the crown that you have to accept the responsibility?

Hon. Alfonso Gagliano: I did by taking action. 

The Chair: To this committee.

Hon. Alfonso Gagliano: But if you let me finish, I also instructed the internal audit to continue the audit and audit all the files of the sponsorship. Later on I was told that the same problem was--meaning an administrative problem--in the rest of the files.

Therefore my concern, what I'm telling the committee here, I was told there was no criminal activity so my concern here was to correct the problem. I gave all my time and attention to the plan of action that was in place, a full-up audit and transfer the whole service, CCSB, from public works to the Canadian Information Office that became Communications Canada and keeping public works just for the procurement so as to separate the two.

I think I take a responsibility for that. I did my duty and my job as a minister. You as a Chair and the committee have to decide where the full responsibility lies. I'm telling you what my involvement was. You'll make the final decision.

The Chair: Well, I just think you're failing absolutely and completely, Mr. Gagliano, because you're not running a proprietorship. This wasn't your own business. This was the public good that you were administering and as a minister of the crown you're responsible to Parliament. 

You're sitting before a parliamentary committee and you have heard from the various, you have said to the various witnesses, what you did but you have an obligation, sir, to accept the responsibility for everything that happened in your department before this committee and before Parliament. Are you going to do that?

Hon. Alfonso Gagliano: Mr. Chair, I mean, you're raising definitely a very legal issue here.

The Chair: It's not a legal issue, it's a parliamentary issue.

Hon. Alfonso Gagliano: Well, it's a parliamentary issue but I mean, you're asking me to incriminate myself and therefore I won't do that. So therefore, I mean, like I said, I'm here before the committee and I am telling the committee, and I'm answering all the questions, and you might not like the answers but those are my answers. Those are the facts that I know on that involvement and as a committee you'll make that judgment.

The Chair: Okay. Mr. Walsh, would you please advise us and the witness about the privilege and his responsibilities before this committee?

Mr. Rob Walsh: Mr. Chair, the witness used the word, "incriminate." I don't think there's anything the exchange, either on this occasion or any other occasion that could be taken as giving rise to a possible incrimination of this witness or any other insofar as the proceedings of this committee and testimony provided at this committee are not available for use in any other proceedings or in any investigation, whether of a criminal nature or any other nature. I just wanted to make that clear, if that is of assistance to the committee.

The Chair: Okay, and do you have any direction to the witness other than what you've just said?

Mr. Rob Walsh: It wouldn't be my place to give any direction to the witness, Mr. Chair.

The Chair: Okay. Let me ask you again, Mr. Gagliano. As a minister of the crown responsible to Parliament, you as a minister are responsible for everything that went on in your department whether you knew about it or not. Will you accept responsibility before this committee, before Parliament, for the problems that occurred in your department?

À (1030) 
Hon. Alfonso Gagliano: Mr. Chair, I accept the responsibility of my action and the action is that when I knew what was wrong I took action. That's my responsibility.

The Chair: As I said this morning, democracy is threatened in this country. Mr. Toews, do you have a point of order?

Mr. Vic Toews: It just related to your questioning. What I didn't quite understand was the issue of responsibility. As I understood, perhaps they arose out of Mr. Kenney's question dealing the 2000 audit report.

The Chair: Is this a point of order?

Mr. Vic Toews: Yes. I'm just seeking that because I think this is a very important issue. Mr. Kenney has raised the 2000 audit. This was a report that the minister indicated he initiated. It's an 18 page report. He didn't read it.

Are you asking him, Mr. Chair, whether he's responsible as a result of the report that he initiated but didn't read this 18 page report?

The Chair: That's not a point of order, Mr. Toews, but just a second. I'll respond.

Mr. Gagliano, ministers are responsible not just for their own actions but for all actions of your department and for your omission to do things, as well. I think Mr. Walsh said, "The dog that didn't bark," is as much evidence as the one that did or something to the effect, earlier this morning.

You, as a minister, are responsible for your actions and your omissions. Do you accept that responsibility?

L'hon. Alfonso Gagliano: Mr. Chairman, I believe in my statement yesterday I talked about ministerial responsibility when they are appointed a minister. You answer to the Prime Minister who appoints and you answer collectively to Parliament. I believe when I was minister I exercised my responsibility. I'm called in here as an individual, as a former minister, to come before this committee and tell the committee the kind of action I took while I was minister on this file and I'm doing it. I've been doing it since yesterday, but really I don't understand why on this and that. 

The Chair: Well, perhaps you didn't understand your responsibilities as a minister of the crown.

Mr. Mills, on a point of order.

Mr. Dennis Mills: Mr. Chair, I'm seeking a clarification, because this is the second time now this morning where you, as Chair, have said democracy is threatened and I just wondered if you could take a couple of minutes and help me out as to what you mean when you say "democracy is threatened".

Some hon. members: Oh, oh.

Mr. Dennis Mills: This is quite serious.

The Chair: Mr. Mills has asked a question and it's a serious question. 

An hon. member: It's not a point of order.

The Chair: Well, it may not be a point of order. He can bring it up as a point of debate, but he has raised the issue. 

Let me tell you, I see Parliament's role, Mr. Mills, quite simply. We act on behalf of the Canadian public to hold government accountable. We, Parliament, approve legislation. We debate it in public. The public know what we're doing and we approve, amend or decline to give that approval. We approve the budget and the taxation policies to raise the funds the government needs to administer the public good. We approve the estimates, the department line-by-line spending and we debate that in public on behalf of Canadians and we approve and give Parliament, the government, the authority--

Mr. Dennis Mills: I understand that.

The Chair: --and number 4, government reports to Parliament. Therefore, that is why democracy's threatened when we're finding the government is not giving us fulsome answers and evasive answers and avoiding the responsibility to Parliament. That is why I feel democracy is threatened. 
An hon. member: That's your opinion.

The Chair: That's my opinion.

Mr. Dennis Mills: That's what I thought you were going to say.

The Chair: We will now go to Mrs. Longfield for eight minutes.

Mrs. Judi Longfield (Whitby-Ajax): Thank you, Mr. Chairman.

The Chair: Oh, sorry.

Monsieur Gauthier, my apologies. Monsieur Gauthier for eight minutes, then Mrs. Longfield.
[Français]
M. Michel Gauthier: Merci, monsieur le président.
Je remercie mon collègue également qui me donne son temps. 
Alors, monsieur Gagliano, j'aimerais revenir sur une chose. M. Quayle quand il est venu ici, le sous-ministre, il nous a expliqué ou il a expliqué au comité que le transfert entre M. Guité et M. Tremblay, votre ancien chef de cabinet, s'est fait de l'un à l'autre, c'est-à-dire que M. Guité a rencontré M. Tremblay, il lui a transféré les dossiers, il lui a transféré la direction, et M. Tremblay est parti avec ça pour administrer. 

La question que je me pose: comment pouvez-vous expliquer que votre ex-chef de cabinet qui est un militant issu du Parti libéral sûrement, qui est proche de vous, dont le rôle essentiel c'est de vous protéger et de vous supporter, qui sait que vous avez délégué beaucoup de pouvoirs, qui est informé de la façon dont cela fonctionne dans cette direction-là et que sa première réaction n'est pas de dire: " oh, là ça n'a pas de bon sens, il faut que je prévienne le ministre, il fait des choses incorrectes ". Comment expliquez-vous qu'au lieu de faire cela il a continué, as usual, et il a donné plein de commandites selon les mêmes critères, de la même façon que procédait M. Guité?
À (1035) 

L'hon. Alfonso Gagliano: Monsieur Gauthier, comme je vous l'ai dit tantôt, je ne peux pas répondre à cette question dans le sens que je pense que c'est une question que M. Tremblay pourra répondre. Comme je vous le dis, moi, comme ministre, je ne m'occupais pas des autres ministres, je ne m'occupais pas des autres, quand un fonctionnaire s'en va ou prend sa retraite et un autre arrive, le passage des pouvoirs et ces choses-là c'est la responsabilité des dirigeants et des fonctionnaires du ministère. Donc, moi je n'ai pas suivi ce processus-là. La seule chose que je sais, selon ce que le vérificateur interne m'a dit, c'est que, disons, M. Tremblay, dès son arrivée--et je pense que cela doit être indiqué quelque part--avait commencé à faire des améliorations dans le système. Alors le vérificateur interne m'a dit ceci, j'avais.

M. Michel Gauthier: Monsieur Gagliano, je veux bien vous croire quand vous dites qu'il a amené des améliorations dans le système. J'ai plutôt l'impression qu'il la rendu plus efficace dans le sens où il voulait le rendre efficace.
L'hon. Alfonso Gagliano: Ce n'est pas moi qui le dit, c'est vous.

M. Michel Gauthier: À titre d'exemple, on a parlé tantôt du rapport de Groupaction qui a été fait une fois, payé, après cela recommandé, non fait, payé, etc. C'est le rapport 1998-1999 qui est le premier rapport qui n'a pas été déposé et qui a été payé, mais ce rapport-là a été autorisé, le paiement a été autorisé par M. Pierre Tremblay, il était là depuis juin 1999. Le rapport 1998-1999 a dû se faire, j'imagine, vers la fin de l'année 1999. Comment expliquez-vous que votre chef de cabinet issu du Parti libéral, dont le rôle est de vous protéger, ne vous ait pas dit: " monsieur Gagliano, il y a un problème, dans la direction que j'ai il y a un rapport qui a été commandé qui n'a pas été déposé et je me sens obligé de le payer. Et en plus, c'est la firme qui a fait notre campagne électorale la dernière fois ". Ne pensez-vous pas que cela étire l'élastique un peu grand?

L'hon. Alfonso Gagliano: Comme je vous l'ai dit dès le début, monsieur Gauthier, je n'étais pas au courant que ce genre de rapports étaient commandés. Je ne connaissais pas leur existence. Je l'ai appris comme tout le monde.

M. Michel Gauthier: Ce n'est pas ce que je vous demande, monsieur Gagliano. Je vous demande ceci: est-ce que vous n'êtes pas...

L'hon. Alfonso Gagliano: Oui, mais vous me demandez de passer un jugement sur M. Tremblay. C'est lui qui pourrait répondre à ces questions-là. Moi, je peux répondre de mes actes, et non pas des actes des autres.

M. Michel Gauthier: Monsieur Gagliano, quand il y a eu un rapport qui vous a dit qu'il y avait des choses tout croches à la direction des communications, l'idée ne vous est pas venue d'appeler votre ami, ex-collaborateur, militant libéral, celui qui vous a protégé pendant des années comme chef de cabinet, et de lui dire: "Écoute bien, comment ça se fait que tu ne m'as pas informé d'une chose comme celle-là, et comment, en plus, tu as pu payer un rapport qui n'a pas été déposé et que tu as pu en commander un autre, sachant que c'était la firme qui avait fait la publicité de notre campagne électorale?" Vous n'avez pas eu l'idée de parler à M. Tremblay? Il était dans votre ministère.

Vous dites vous-même que vous aviez une grande délégation de pouvoirs. Quand on délègue nos pouvoirs, de temps en temps, j'imagine qu'on regarde ce qui se passe, surtout quand on nous met le doigt sur la sonnette, monsieur Gagliano.

L'hon. Alfonso Gagliano: Tout d'abord, j'aimerais vous dire, monsieur Gauthier, que le rapport du vérificateur interne n'a jamais parlé des rapports de Groupaction. Je vous l'ai dit à maintes reprises que le vérificateur interne m'a dit clairement que, depuis que M. Tremblay est directeur exécutif suppléant, il a amélioré beaucoup de choses.

Je n'avais aucune raison de dire à M. Tremblay: "Comment ça se fait que tu ne m'as pas rapporté tout ça?" Il ne faut pas oublier que M. Tremblay était un fonctionnaire à ce moment-là. Avant d'être fonctionnaire, j'ai exigé qu'il prenne trois mois de congé sans solde afin qu'il puisse se distancier complètement entre ses relations avec mon bureau et le ministère.

M. Michel Gauthier: C'est bien noble comme intention, monsieur Gagliano, mais vous ne pouvez pas, comme ministre, d'un côté, expliquer à tout le monde que vous faites la plus grande délégation de pouvoirs au Canada quand vous êtes nommé ministre, en donnant un pouvoir à tout le monde et en vous fermant les deux yeux, et ensuite nous dire: "Je ne parlais plus à ceux qui étaient fonctionnaires, même ceux qui ont été mes attachés politiques."

Il a tellement bien continué l'ouvrage, M. Tremblay, votre chef de Cabinet, il a tellement appris vite dans cette petite rencontre avec Chuck Guité, qu'il a recommandé un rapport de 575 000 $ qui n'a jamais été déposé et qui a été payé. Je dois vous dire qu'il doit être un vite, s'il a appris cela dans la rencontre avec Chuck Guité, comment ça marchait et comment les affaires pouvaient se faire.
Je vous dis mon hypothèse, monsieur Gagliano. Est-ce que ce n'est pas plutôt que Pierre Tremblay n'a eu aucune surprise quand il est arrivé à la direction des communications, parce qu'il savait que c'était ainsi que ça marchait et que c'était "as usual", on continue la business? Il n'avait pas besoin d'informer son ministre, puisqu'il était déjà informé de la manière dont ça marche.

C'est ce que je pense, monsieur Gagliano, et je vous demande de me contredire et de me donner des explications si j'ai tort.
À (1040) 
L'hon. Alfonso Gagliano: Je vous dis que vous avez tort. Le ministre n'était pas au courant. Le vérificateur interne m'a dit, après que M. Tremblay ait été en poste depuis quelques mois, qu'il avait déjà commencé à apporter des correctifs. Alors, je n'avais aucune raison de douter de M. Tremblay.

D'ailleurs, tout le plan d'action en 37 points était développé par le Conseil du Trésor et M. Tremblay. Toutes les mesures étaient mises en place. J'ai transféré les services du ministère au BIC, qui est devenu Communication Canada. Comme ministre, du moment que j'ai appris qu'il y avait un problème, j'ai exercé mes responsabilités.

M. Michel Gauthier: Il me reste juste une question. Monsieur Gagliano, on va être francs, tous les deux. Cela n'a toujours pas d'allure. Votre ancien chef de cabinet réalise, dans une rencontre avec Chuck Guité, que c'est tout à fait différent de ce que le ministre pensait au cabinet et de ce que son cabinet pensait, et qu'il y a toutes sortes de choses. Il ne vous en parle pas, il continue de plus belle, et il commande un rapport et donne 575 000 $ à la firme qui a fait la campagne du Parti libéral. Tout va très bien, et il commence à apporter des améliorations quand il y a un rapport d'enquête interne, parce qu'il y a eu des dénonciations à la Chambre des communes et dans les médias d'information.

De deux chose l'une, monsieur Gagliano: ou bien votre chef de cabinet, la journée où il vous a quitté, vous a renié et a voulu vous en jouer toute une, ou bien donc vous ne nous dites pas la vérité. Je regrette, il n'y a pas 50 000 façons, il n'y a personne ici capable de croire que votre chef de cabinet se soit comporté comme un goujat comme il l'a fait à votre endroit. Je pense plutôt qu'il a continué de fonctionner comme il était habitué de fonctionner avec vous. C'est cela, la réalité.

L'hon. Alfonso Gagliano: Monsieur le président, je pense que j'ai répondu plusieurs fois à cette question. C'est encore de la répétition. Comme je vous l'ai dit, j'ai appris, de la part du vérificateur interne, que M. Tremblay avait apporté des corrections, et bien qu'il ait été là seulement quelques mois, c'était lui qui avait mis en place, avec les fonctionnaires du Conseil du Trésor, le plan d'action qui est attaché au rapport de vérification interne.
[English]
The Chair: Merci beaucoup, monsieur Gauthier.

Madam Longfield, please, eight minutes.

Mrs. Judi Longfield: Thank you, Mr. Chair.

Mr. Gagliano, yesterday in response to--

Mr. Vic Toews: I believe that this is appropriate. Just in respect to the matters that were mentioned in respect of the minister's instruments of advice, I would like to read a formal motion to proceed--

The Chair: It is not a point of order to read that at this point in time, Mr. Toews. I'll give you extra time when you are done your eight minutes so that you can read it at that point in time.

Mrs. Judi Longfield: I won't interrupt your eight minutes.

Mr. Vic Toews: That's why I wanted to go before you, so that I didn't interrupt your eight minutes, Ms. Longfield.

The Chair: We'll get that. In fact, I think we don't even need it on the record. We'll just have it distributed in both official languages and that will be sufficient.

Ms. Longfield, please, eight minutes.

Mrs. Judi Longfield: That is starting now. Is that correct?
À (1045) 
The Chair: It is starting now.

Mrs. Judi Longfield: Thank you, Mr. Chair.

Mr. Gagliano, yesterday in response to my question relating to what supporting documentation you reviewed before you signed off on the Treasury Board submissions for additional funds related to the sponsorship program, you replied: 

I didn't see the appropriate documentation--

Then you further went on to say:
--and I assumed that all the paperwork and the documentation that you thought was in the file, but I didn't see it and I didn't ask him for it.

Yet later in response to Mr. Kenny's question, "How did you express your desire to be directly involved in the administration of the sponsorship program?" you responded:

Well I would sign for the budget. I would sign for the submission for the Treasury Board. I think I would have been expected to have some information before signing that Treasury Board submission.

Sir, what information would you think would have been appropriate before signing that Treasury Board submission?

Hon. Alfonso Gagliano: At the policy level...and therefore, the amount of money that we were asking before Treasury Board-you have to realize that we spend about $40 million a year and we had demands for three times, at least, that much, so my implication was at the budgetary level, naturally, we had to have a list of events with the amounts of the total of the money that we were asking, and that's the discussion I had.

Mrs. Judi Longfield: But isn't that--

Hon. Alfonso Gagliano: I assumed--when I signed the Treasury Board, which you have the document you can see, there is a paragraph where it says clearly that all this should be according to the Public Administration Act and the Treasury Board guidelines, so--

Mrs. Judi Longfield: But normally that would have been conveyed to your through the deputy minister--

Hon. Alfonso Gagliano: Yes.

Mrs. Judi Longfield: --not through the executive director--

Hon. Alfonso Gagliano: No, no, any--

Mrs. Judi Longfield: --but this was in response to why you met with Mr. Guité.

Hon. Alfonso Gagliano: Prior to meeting with Mr. Guité and I agreed, after discussion on a list of events that would be presented to the Treasury Board, then 

I would inform my deputy minister that I had a discussion with Mr. Guité. Mr. Guité would go and see the deputy minister. The deputy minister would prepare with Mr. Guité- or, I don't know, anybody else in the department-a submission for Treasury Board and then that submission for Treasury Board would come to me for signature, and I said yesterday, very clearly, I never signed a Treasury Board submission without the recommendation of my deputy minister.

Mrs. Judi Longfield: In testimony yesterday the Auditor General stated that there was a lot of authority vested in the executive director, Mr. Guité. Today in response to a question from Mr. Gauthier you offered confirmation that you delegated your signing authority for contracts between $500,000 and $10 million to the deputy minister and then further to the executive director, Mr. Guité. In light of this, after the results of the internal audit of 2000, what attempts did you make to speak directly to Mr. Guité, who'd been responsible for running the program-I know he wasn't there any more, but you knew him, you talked to him on a regular basis-and to Mr. Quail, given that the least of things was evidence of gross irregularities, gross mismanagement, a total disregard for Treasury Board guidelines that occurred under your watch and that occurred to people you had designated signing authority for? Did you not pick up the phone to some of these people and say, "What in the hell were you guys up to? You hung me out to dry here. You made these submissions. I assumed, I trusted you, that you'd have this documentation there." Did you get on the phone and say, "What were you doing? 
How could you have done this?"

Hon. Alfonso Gagliano: 
Let me first clarify on the delegation power, authority, because it seems that this was exceptional. That type of delegation of power, it's, if you go through the departments, because if the minister has to sign all the documents then the contract, naturally, would slow down so much and already Canadians complain about the bureaucracy. So that was regular, in the sense that I was signing contracts up to $10 million-- 

Mrs. Judi Longfield: I'm not suggesting that it was irregular to delegate authority. 

I'm just saying that when they obviously misuse that authority--

Hon. Alfonso Gagliano: I didn't. Once Mr. Guité left the department I never saw him, I never had contact with him.

Mrs. Judi Longfield: Okay.
Mr. Gagliano, do you understand that most Canadians believe that in your capacity as a minister of the crown, if you affix your signature to a budget submission to treasury board, then by virtue of that signature that your are ultimately responsible for the authenticity and the completeness of that submission and that all specific projects flowing from that submission are compliant with treasury board guidelines and operate within the Public Administration Act? 

Doesn't the buck stop somewhere? I mean, is the minister of the crown operating on the principle hear no evil, see no evil, speak no evil? Or, you know, don't ask, don't tell? I mean, is that what Canadians expect?

Hon. Alfonso Gagliano: When a minister is told something and finds out that something is wrong in his department, his responsibility is to fix it. If he doesn't fix it, well then, I mean you know, it's clear that he is not acting properly, is not taking his responsibility. In this case, I took my responsibility and I fixed the thing.
À (1050) 
Mrs. Judi Longfield: Okay.

Given that you say that once you knew about it you proceeded to try to fix it, what advice would you give to minister of the crown now, in terms of exercising their authority or their supervisory role over their department? I mean, is there something the matter with the letters of mandate? Given what you're going through now, what you see happening, would you not say to someone "You're the minister and you'd damn well better know what's going on because this is what's going to happen if you don't."?

Hon. Alfonso Gagliano: Well, if I had a position of giving advice, looking back on my experience, the first thing I would recommend is that there would be mandatory annual audit; that the audits are from the treasury board office and not in the department office. Secondly, I would ask that there is a mandatory rotation system. I mean, the bureaucrats stay 10 years, 15 years in the same position and that's not healthy in terms of management control. And if you look at another, for example, the diplomatic corps, every four years, no matter what their level of the foreign service, you've got to move on. And so that creates a certain transparency and follow up, added with internal annual audits--

The Chair: Ms. Longfield, your next question.

Mrs. Judi Longfield: Part of the reason that bureaucrats stay for as long as they do is to give some sort of corporate memory. So do you attach any importance to a body of people having that kind of memory? I mean, is it supposed to be every year everybody relearns the job? 

Hon. Alfonso Gagliano: I don't say every year. We're talking here four, maximum five years, in terms of a corporate memory. I mean, they should be with the annual audits and applying the procedure. There will be details of record.

Mrs. Judi Longfield: Should it change then with every new minister? So when a new minister comes in, with that new minister comes a new set of--

Hon. Alfonso Gagliano: No, I'm not saying that because then we would link it to a political system. I think, like, for example, the foreign affairs service, they're not linked to the government or the minister who changed. 

Mrs. Judi Longfield: But, they're not--

Hon. Alfonso Gagliano: You get a posting for four years. You are entitled to ask for an extra year--most of the time it's not granted--and you move on to another post, and that determines the system. So the person who is leaving, he's know that when he's leaving, he'd better leave his paper in order because somebody else will--

The Chair: Okay, thank you very much, Mr. Gagliano.

Thank you very much, Ms. Longfield.

Ms. Jennings, huit minutes.
[Français]
Mme Marlene Jennings: Merci, monsieur le président.
Merci beaucoup pour votre témoignage aujourd'hui et les éclaircissements que vous nous fournissez sur certaines questions. 

On vous a demandé sur la question du moment où vous avez reçu un rapport verbal intérim sur la vérification interne que vous avez commandée ou approuvée suite au conseil que votre sous-ministre vous a fourni concernant le Programme des commandites et que, au moment où vous avez reçu ce rapport intérimaire ou intérim verbal votre première réaction a été de demander: " est-ce qu'on informe la GRC pour une enquête criminelle " et que votre sous-ministre et les autres fonctionnaires, et possiblement votre personnel politique, qui ont assisté à cette rencontre ont dit: " non, non, monsieur le ministre, il n'y a pas matière criminelle, ce sont seulement des problèmes administratifs ".

Sur le guide Gouverner de façon responsable, le guide du ministre et du ministre d'État à la page 45, le paragraphe A.4, Les ministres et la loi, on nous dit:
Toutes les activités du gouvernement doivent être légales. Si un ministre a des doutes quant à la qualité de telle ou telle action, il doit demander conseil à son sous-ministre et obtenir un avis du ministre de la Justice.
ce que vous avez fait. En aucun moment, si je vous comprends bien, malgré le conseil de votre sous-ministre, vous n'avez demandé un avis du ministère de la Justice et en aucun moment votre sous-ministre ne vous a suggéré que même si nous croyons que c'est simplement de nature administrative il serait peut-être bon qu'on donne cela à la police parce qu'ils sont des experts pour savoir s'il y a matière criminelle ou non. Est-ce exact?
À (1055) 
L'hon. Alfonso Gagliano: J'ai eu un avis du vérificateur interne appuyé par le sous-ministre et qui était clair qu'il n'y avait pas matière criminelle. Je ne me souviens pas et je ne sais pas quel document vous lisez, j'imagine que c'est celui qui a été signé en décembre 2003, le nouveau gouvernement, et je ne me souviens pas qu'il y avait des dispositions où j'aurais dû interpeler le ministre de la Justice. Mais je peux vous dire que je ne l'ai pas fait, j'ai eu conseil du vérificateur.

Mme Marlene Jennings: Parfait. Nous avons déjà demandé d'obtenir du Conseil privé tous les guides pour les ministres depuis 1993, je crois, pour s'assurer qu'on pose la bonne question à la bonne personne. Dans ce même document à la page 33, paragraphe VI.1, Le Cabinet et le personnel politique des ministres, deuxième paragraphe, deuxième phrase, c'est inscrit:

Le personnel politique n'est pas habilité à donner des ordres aux fonctionnaires, mais il peut leur demander de l'information ou leur transmettre les instructions du ministre en passant normalement par le sous-ministre.

Nous avons reçu des témoignages avant que vous comparaissiez devant nous de la part d'au moins une personne et peut-être d'autres personnes à l'effet qu'il y a eu des contacts de façon soit quotidienne, soit hebdomadaire, entre le personnel du Programme des commandites et surtour de M. Guité mais possiblement d'autres personnes dans son entourage immédiat et le ministre ou le cabinet du ministre. Vous dites que normalement, non, mais à ce moment-là il y a une incohérence entre les deux témoignages, parce qu'il y a un témoignage qu'il y a eu des contacts de façon régulière.

L'hon. Alfonso Gagliano: Je n'ai jamais nié qu'il y avait et pouvait y avoir des contacts réguliers avec mon cabinet pour le simple fait que chaque fois que j'ai réservé ou mon cabinet a réservé des représentations soit d'un député ou le parti, soit d'autres organismes, de députés provinciaux, de maires, définitivement j'ai transféré cette information-là, cette représentation-là à mon cabinet et mon cabinet le transférait, en faisait part soit au directeur exécutif lui-même ou à son personnel qui lui-même avait délégué. C'était la seule.
[English]
The Chair: 
Okay, merci beaucoup, Mr. Gagliano. 

I'm going to interrupt your testimony, Madam Jennings. Some people have some commitments and we are going to break at 11:00 o'clock. However, before I do that, we have a couple of points or order, one from Mr. Murphy and Mrs. Ablonczy. 

Mr. Murphy, please. 

Hon. Shawn Murphy (Hillsborough, Lib.): Thank you, Mr. Chairman. 

Mr. Chairman, just a point regarding the direction of the committee and an article that appeared in this morning's Ottawa Citizen and it quotes you, Mr. Chairman, and I'll read it here and I don't know if the quote is accurate or not. You can comment. 

The chairman of the parliamentary committee into the sponsorship scandal said yesterday the problem is to play the media out and schedule star witnesses on different days so that the impact of the testimony receives more attention.

And you were subsequently quoted, but again, Mr. Chairman, about playing the media out. And you're doing a good job, Mr. Chairman and you have a difficult job and a challenging job and I applaud you, but this brings the committee into disrepute. 

We're not here to play the media out or to feed the media or to be puppets to the media. This is a parliamentary committee; it's not a circus and if it is correct, I urge you to withdraw your remarks. 

The Chair: You're absolutely correct, Mr. Murphy. This is not a circus. This is a very serious investigation. It's important that we communicate with Canadians as to what we do, all our business in public, and it's important that the committee be observed by Canadians to the best of their ability as to what we do in a democratic process. 

The guidance of the committee was, I think, overheard by someone yesterday. 

We can't have all the witnesses on one particular day, and so on, so I can raise that and have discussions with it on the steering committee next week. 
Mrs. Ablonczy. 

Á (1100) 
Mrs. Diane Ablonczy: Mr. Chairman, we have an unusual circumstance today. We have, as you know, a leadership convention for the Conservative Party. 

Some hon. members: Hear, hear. 

Mrs. Diane Ablonczy: Generally speaking, Parliament does not sit on weekends, on Fridays, when party conventions are taking place. We have, of course, made an exception in this case because Canadians wanted very much to hear from Mr. Gagliano and we, as members of the official opposition, wanted to make sure that we facilitated that. 

However, many of us have convention commitments beginning this afternoon. I know that we have a lot more we want to get from the former Minister of Public Works, so I would make it a motion that because we'll have to adjourn early--or at least some of us will have to adjourn early today because of this other commitment--that we have Mr. Gagliano back next week at the earliest opportunity so that we can continue this examination. 

I think everyone feels--certainly I feel and certainly the country feels--that we have not gotten to the bottom of what this witness can tell us, so I would like to make that a motion, Mr. Chairman. 

The Chair: Thank you very much, Mrs. Ablonczy. 

I am cognizant of the need to move forward as quickly as we can and I am cognizant of trying to organize the committee and make sure that we have a steady line of witnesses. We cannot accept motions but I was going to have an informal discussion with some members of all parties later on today, followed by, on Monday, a public hearing at 9:00 o'clock where we consider all the motions that have come out of this week, followed by the subcommittee, of witnesses, so that we can talk to more witnesses and our steering committee as well, next Tuesday, so that we can really set the stage. And that, of course, will include the recall of Mr. Gagliano at that point in time, if the committee so desires. Your point is taken and Mr. Gagliano, you may expect the committee may want to call you back. 
Mr. Tonks. 

Mr. Alan Tonks: Mr. Chairman, I think that we would all like to facilitate a request to meet the member's concern. 

May I ask you, Mr. Chairman, how many speakers you have, just on this first round, that are on your list and haven't had an opportunity to ask a question? The reason I ask that, Mr. Chairman, is that if it would be possible that if there's any question of adjournment, that it would be--if it isn't asking too much--after at least the round has been completed, that's all. 

The Chair: We were not talking about an adjournment. We're going to 1:00 o'clock. 

Mr. Alan Tonks: Oh, I see. 

The Chair: We have a full list of names. 

Mr. Alan Tonks: Oh, I see. 

The Chair: The point being that some members may not be able to stay and therefore would like to ask questions so they're asking Mr. Gagliano to come back. 

Mr. Alan Tonks: I see, and my request would be that if there are only one or two that have not had a chance on the first round, then that's just like 16 minutes that we could then adjourn even earlier than the 1:00 o'clock in order that--

The Chair: 
I think we have enough. We have Mr. Mills, Ms. Phinney, Mr. Murphy, Mr. Toews, Mr. Tonks, Mr. Gauthier, Mr. Desrochers, Mr. Kenney, and of course the Chair can always ask a couple of questions as well. So I expect we'll go on until about 1 o'clock.

Ms. Ablonczy's point is well taken, that parliamentary business is important as well especially conventions and the choosing of leaders. As she pointed out, Parliament does not normally sit during a convention, so parliamentarians can continue to do that part of the work.

Ms. Phinney.

Ms. Beth Phinney (Hamilton Mountain, Lib.) (Hamilton Mountain, Lib.): I was just wondering, Mr. Chair, how many of that particular party from the opposition has already asked their question. How many are there left....

The Chair: We've heard from Mr. MacKay. We've heard from Mr. Kenney. We haven't heard from Mr. Toews. We haven't heard from Ms. Ablonczy either.

Ms. Beth Phinney: Could I suggest, Mr. Chair, that those two be given the courtesy of being able to ask their questions as soon as possible? I'm willing to give up my space if it moves one of them forward, not give it up permanently but....

The Chair: Unfortunately when we reconvene at 11:30, they will be on their way to the airport.

Ms. Beth Phinney: Oh, they are going to leave now. Okay.

Ms. Judy Wasylycia-Leis: Can we continue on until 11:30?

The Chair: If it's the agreement of the committee that we continue on, then I'm quite prepared to continue on and either postpone the break or continue through the break.

Mr. Toews.

Á (1105) 
[No Salutation Found] UNKNOWN UNKNOWN: Cancel the break.
.


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