Mr. Norman Spector:
Thank you, Mr. Chair.
As you know, I am not delighted to be in Ottawa today. That has to do with the snow and the weather, it is true, but it also has to do with the climate here. I left this city in 1996 after I resigned from the public service of Canada.
I resigned from the public service in circumstances eerily parallel to my brief but still-shining moment with Karlheinz Schreiber, with one significant difference. When presented with the facts, Mr. Mulroney did not hesitate to do the right thing and declare Bear Head dead.
In 1996, had my deputy ministerial colleague at Public Works stood up to the very same minister who was piling pressure on us at ACOA, he could have nipped in the bud what became the sponsorship scandal.
Regrettably, efforts by your public accounts committee to minimize these situations in future are being frustrated by the government, as Mr. Gomery reminded us on the second anniversary of his report and of our not-so-new government.
Canadians who have been following the Mulroney-Schreiber affair have been seeing how Canada really works. The story is one of lobbyists and lobbying and of the power of the Prime Minister and his office. It's also a story about the media.
I can't help wondering whether you'd have launched these hearings back in 2001, with Frank Moores still alive to testify, had the National Post not killed the story of Mr. Schreiber's cash payments—a story that flew in the face of everything we thought we knew when the government paid Mr. Mulroney $2.1 million to settle his defamation suit—or maybe three years and not three months ago, had William Kaplan been interviewed on Politics or on The House or on any of the other programs that routinely feature far less significant books than A Secret Trial.
Can you imagine a newspaper in Canada killing a sensational scoop about a former Prime Minister that is today on everyone's lips? Frankly, it still boggles the mind.
I warn you, don't get me started on journalism in your questions. I spend most of my time these days reviewing the daily press on my website, and it's not always a favourable review.
Today I'm here to assist you in two specific areas, first on the Bear Head project, the reason you summoned me to Ottawa to appear today.
In 1995, I gave the RCMP, at its request, a sworn statement about what I knew regarding Mr. Schreiber's Bear Head project.
As you know, Ottawa was brimming with lobbyists in the 1980s. Some of them made a lot of money. One of them, Fred Doucet, had extraordinary access to the Prime Minister's Office. After he left PMO, he would still bring visitors to the PM's office on the Hill, upstairs. These appointments were not on our schedule and were unknown to me, unless I happened to chance upon them. This extraordinary access may explain in part why Bear Head refused to die even after Mr. Mulroney killed it.
As I wrote recently in Le Devoir, I can also help you identify the sources of the large amounts of cash that were brought back to 24 Sussex Drive.
Frankly, some of my neighbours were scratching their heads when they heard that you had invited Mr. Mulroney's ex-chef to testify, but I guess it's understandable in light of the possibilities conjured up over the years by François Martin's vivid Upstairs, Downstairs gossip.
The documents I've brought today, including two I've not written about before, identify a more prosaic source of this cash. As you will see from these documents, Mr. Mulroney and his family had an expensive lifestyle, and one can understand why he would have been somewhat preoccupied by what life after politics would bring, and perhaps this explains why he seemed eager to cater to the rich and powerful, as I described in the Kaplan afterword with anecdotes, one of which has never been reported.
I urge you, however, to keep your eye on the ball and not to get distracted by the kind of stuff that fills Frank magazine.
Around the end of Mr. Mulroney's second term, Canada was rated the fifth least corrupt country by Transparency International. When Mr. Chrétien left office we were twelfth. At the end of the Paul Martin interregnum we were fourteenth, which means that this town has a bipartisan problem.
A better way to look at it is that it also has a bipartisan solution, in that two parties are not centrally implicated in this problem, not having formed government. Since 2006 Canada has climbed back to ninth place, but as news out of Public Works last week suggested, we have a long way to go to ensure that the best country in the world is also the least corrupt country in the world.
In contrast to the leadership shown by Paul Martin when sponsorships hit the fan, I have grave doubts that Mr. Harper wants Airbus answers, and I also doubt that the proposed public inquiry will uncover where $10 million in “Schreibergeld” ended up.
The darker possibilities were captured by a Mulroney cabinet minister visiting the splendid new home of the head of Earnscliffe, then a Tory lobby firm, it may surprise some of you to know. Why is it so much more lucrative, he asked, to know Harvey André than to be Harvey André?
You are here today, and I'm not out walking my dog gazing at trees in first blossom, because the RCMP botched its Airbus investigation. And I hope that in drafting your final report you'll examine the special prosecutor system designed by your former colleague, and your former colleague, the Honourable Stephen Owen, in British Columbia. Meanwhile, this wretched process is Canadians' best hope for getting to the bottom of the story that was ignored by members of Parliament and suppressed to a remarkable extent by remarkably large sections of the media for a remarkably long time.
As a semi-retired public servant, it would have been easy enough to say no and go on enjoying life in Victoria when Mr. Kaplan asked me to contribute an afterword to his book, A Secret Trial, Brian Mulroney, Stevie Cameron And The Public Trust . You've come to the table late, but late is better than never, unless, that is, it is simply to dine out on partisan politics.
You have all the powers you need, and Mr. Ménard and Mr. Comartin have already set the example.
If you're truly serious about getting to the truth, you'll not hesitate to subpoena tax and bank records or to invite Mr. Mulroney back to testify, and you'll start pressing the government to offer Mr. Schreiber a deal to spill the beans--if he has any to spill, that is.
Thank you for your attention.
Mr. Norman Spector:
Mr. Hiebert, with respect, your committee invited me here today. Your committee knew that I was not in Ottawa in 1985. So I don't know why you're interrogating me this way. You summoned me to Ottawa. With the things I've written in The Globe and Mail
and the things that I've written in the afterword of the Kaplan book, assuming you've read them, this committee obviously felt that I did have information that was relevant. So I'm not sure why you're saying this to me.
As for your citation of the RCMP's statement, I don't believe them and I don't think Canadians believe them. I think Canadians now are very skeptical about the RCMP. I think they're skeptical about the RCMP for a whole bunch of reasons: for events that have taken place in British Columbia recently, for a certain announcement that took place during the last election campaign. I think the Canadian people are very skeptical about the RCMP, and I don't believe them. I think you should get the RCMP here under oath, and I will give you the name of the inspector whom you should ask as to whether they had established the fact of these cash payments when they shut down the investigation. I think the RCMP is part of this problem.
You're from British Columbia. You know. In British Columbia, we have had two premiers investigated by a special prosecutor, one from each party, and criminal charges were laid. Both were acquitted. That's part of our system. Our justice system doesn't demand convictions; it demands equal justice. We've had a third premier investigated, and the special prosecutor recommended against the laying of charges. And British Columbians said that's fine too.
In Ottawa, the scorecard is zero at whatever level of the executive council. I have worked as a deputy minister in both jurisdictions. I worked as a deputy minister in Victoria and I worked as a deputy minister in Ottawa. I can tell you that politicians in Victoria are no more corrupt than politicians in Ottawa. You need a transparent process.
Stephen Owen, in his recommendation, in what he did as ombudsman of British Columbia...the insight was the following: to ensure equal justice, which is what our system is based on, sometimes you have to put in place special arrangements for high-profile and particularly political cases. So what happens in British Columbia is that when there's an allegation made against a politician, the assistant deputy attorney general, a career public servant, names an outside counsel from a list developed by the bar association and the department, and that person investigates and determines whether charges should be laid. That is a clean system. This is the system that our British cousins are looking at now. That's the system that Mr. Harper spoke of in the last campaign, when he talked about a director of public prosecutions. It's not quite what we got, but it's the system that we need in Ottawa if we're to stop the slide that this country has seen in Transparency International ratings.
Mr. Norman Spector:
No, Mr. Hubbard, as I have answered Madame Lavallée, I believe, I did not recognize any of those people.
But I must clarify some of things you've said, because I did meet with Mr. Harper in 2003, a couple of days after the article appeared in The Globe and Mail, the first article on the cash payments. Mr. Harper had a pained look on his face and he said, “What should I say?” This wasn't the reason for our meeting. He said, “What should I say if I'm asked about this?” I didn't give him any advice. At that point I was writing for The Globe and Mail....
I'd like to finish, because I think you put some words in my mouth that I would not like to have stand on the record.
I didn't give him any advice, because I thought that it was inappropriate for someone in my position to be giving political advice.
I would have advised him to be very careful, and I think he made a mistake in not being very careful. However, I think it is a mistake that a lot of people in this country made. You only have to think back to September, to a two-hour presentation by CTV, by their chief anchor, on Mr. Mulroney, which was a full-blown public relations exercise, which, at the very last minute, had a puff ball question thrown at Mr. Mulroney about the cash. Now, if the entire CTV news team in Ottawa, all these well-paid, qualified journalists from CTV, didn't smell something that would have said proceed with caution, if the chief anchor, the most experienced journalist in Canada, Lloyd Robertson, didn't smell something that said whoa, whoa, tabarnac, there's something here that we should be very careful about, why would Stephen Harper, poor Stephen Harper, have said, let's be careful about this?
I think that probably answers your question.
Hon. Allan Rock:
Thank you, Mr. Chairman. I know we have only 45 minutes before the vote, so I will read my opening statement.
But I'll try to shorten it because I understand there'll be questions, and time is running.
I believe the opening statement has been distributed to members of the committee, so you have it. But I prepared it to provide a framework within which you might ask questions about the Airbus litigation.
I recall in the opening statement, Mr. Chairman, that I served as Minister of Justice and Attorney General of Canada between November 1993 and June 1997. I recall as well that in the Department of Justice at the time, and I believe it's still the case today, there is something called the International Assistance Group, a group of lawyers who concern themselves with providing advice to the Government of Canada in relation to matters involving other governments, including extradition, and also where police forces in Canada cooperate with police forces elsewhere in terms of investigations.
Among other things, the IAG, or International Assistance Group, transmits requests to foreign authorities by Canadian police services for assistance in investigations. The practice, at least when I was there in the 1990s, was for the Canadian police service in question to prepare a letter of request for the cooperation of the foreign police, bring it to the IAG, the lawyers there would ensure it was in appropriate form for the foreign government, and then it would be sent by the Government of Canada to that foreign government as a formal request for assistance.
I understand from the Department of Justice that as of 1995 there were between 100 and 150 requests for assistance, or letters of request, that went overseas from Justice on behalf of police departments in Canada every year.
Mr. Chair, these letters of request were always treated by the Department of Justice and the requesting police force with the utmost confidentiality, because they dealt with ongoing investigations into the activities of named persons. I am told that there has never been an instance before this one in which the contents of a letter of request became public, notwithstanding that some of them reportedly named other well-known figures.
I should add that the policy and practice of the Department of Justice in each one of these cases was not to inform or to involve the Minister of Justice or the minister’s office in any way before sending a letter of request. Because the letters requested assistance in ongoing police investigations, the minister had no role to play and could not properly either approve or disapprove of the letter going forward. Whether to send the letter was a matter for the police, and it would be improper to have the Minister of Justice and Attorney General deciding whether or how police investigations are carried on.
We all know, Mr. Chairman, that on September 29, 1995, a letter of request was forwarded to the Swiss authorities on behalf of the RCMP in relation to the Right Honourable Brian Mulroney, among others. The letter sought the assistance of the Swiss authorities in an RCMP investigation. In keeping with the justice department’s practice, I was not informed or consulted before that letter was sent.
In fact, I first learned of it on Saturday, November 4, 1995, when I was telephoned at home by Roger Tassé, who was one of the lawyers for Mr. Mulroney. After he briefly told me the nature of his call and what he wanted to talk about, I asked that he speak with my deputy minister, which he did.
On the following Monday, which was November 6, I read the letter of request for the first time. The officials at the justice department recommended that the matter be referred to the RCMP, on whose behalf the request was sent. Mr. Mulroney's lawyers wanted the letter withdrawn, but I was informed by Justice and RCMP officials that it could not be withdrawn because it had already been acted upon. It had been sent overseas. It had been taken by the Canadian consular officials to the Swiss bank, and indeed, copies had been given to the account holders, Mr. Schreiber and Mr. Moores.
There was also a concern that if an effort was made to withdraw it, we might draw more attention to it than we would have otherwise. Remember that during this period, it still had not been in the Financial Post.
But the Department of Justice did send a follow-up letter, making two points to the same Swiss authorities: first of all, emphasizing that everything in the letter of request was in the nature of an allegation only—there had been no findings, only an investigation—and that the letter must be read as comprising allegations; and secondly, underlining the crucial importance of scrupulously respecting the confidentiality of these communications. That letter was sent over to the Swiss authorities on November 14.
Mr. Chairman, on November 18, 1995, the Financial Post published a story about the letter of request, quoting at length from its contents. To this day—subject to what I'll say in a few moments about expert evidence that the government obtained on the question—there's really been no explanation as to how the Financial Post obtained that letter of request.
Mr. Chair, on the same day, November 18, 1995, Mr. Mulroney's lawyers called a press conference to announce that they were launching a libel action against the Government of Canada and the RCMP seeking $50 million in damages.
The government and the RCMP defended that action, and from time to time, the parties made efforts to resolve the litigation short of going to trial. As part of the litigation proceedings, Mr. Mulroney was examined under oath and was asked questions about various relevant matters. The answers Mr. Mulroney gave under oath led the government to conclude that he had not had any dealings with Mr. Schreiber.
As the government and the RCMP prepared for trial, we relied upon two defences in responding to the lawsuit.
First was that any communication by or on behalf of the Government of Canada, so long as it was in good faith and for a proper public purpose, was protected by either absolute or qualified privilege, so that no civil action could be brought in respect of it. And we had expert evidence to support that position.
The second defence was that none of the defendants actually published the libel. This defence arose from the fact that the letter, as served on Mr. Schreiber, was in the German language. In the days after it was served on him, someone arranged for lawyers in Switzerland to translate the letter into English. We called it the Blum translation.
We retained an expert who prepared a report that we intended to rely upon at trial to prove that the version of the letter published in the Financial Post was the Blum translation. Our expert identified what she called “a linguistic fingerprint” that demonstrated the link. If we could establish in the courtroom that the reporter was working from the Blum translation, that would suggest that persons other than the defendants had published the libel.
Shortly before trial, the Department of Justice learned that a member of the RCMP had disclosed to a third party, sometime in late 1995, the fact that the letter of request included the name of Mr. Mulroney. Counsel advised me that this unauthorized disclosure, if entered into evidence at the trial, would destroy our first defence—namely the defence of privilege—and weaken our second defence, which had to do with the publication. In those circumstances, I instructed counsel to reopen negotiations to see whether the litigation could be settled, and those negotiations resulted in the settlement agreement that Solicitor General Herb Gray and I announced on January 7, 1997.
There have been suggestions from time to time, from the outset in this matter, that the RCMP investigation was initiated either by me or other political figures for partisan or vindictive reasons. The settlement agreement, which was personally signed by Mr. Mulroney, sets out his position on that question. In paragraph 8 of the agreement, the parties acknowledged that the procedure used in sending the letter of request in this case was the same as that followed on numerous occasions under both the Mulroney and the Chrétien governments. In paragraph 9 of the settlement agreement, the parties acknowledged that the RCMP on its own initiated the Airbus investigation, that I was not involved in the decision to initiate it, and that before November 4, 1995, I was not aware of the letter of request.
Let me close simply by saying that although the justice department had a long history of sending letters like this in language such as that used in this case, I think we all learned from this instance, and certainly it was my belief that using language that is conclusory, when you're talking about, really, allegations, is wrong. So I directed, after I read the letter of request in this case, that the practice in the Department of Justice change, and it changed. I also appointed the Honourable Allan Goodman, who is a retired justice of the Court of Appeal for Ontario, to look into the whole of the procedure involving letters of request. He made a report with recommendations in early 1997, and I accepted and put into place all of his recommendations.
Mr. Chair, I hope committee members will find this brief summary useful. I would be happy to respond to any questions you might have.