Government, SNC-Lavalin make bad bedfellows

Details in report suggest the ethics issue is broad and deeply entrenched in federal Liberal politics

There’s a bigger stink here.

There’s been plenty written already about federal Ethics Commissioner Mario Dion and his report on the SNC-Lavalin affair, and the fact that he found Prime Minister Justin Trudeau to have broken the conflict of interest code for federal politicians.

That alone is massive, but deep in Dion’s report is a single paragraph that I find even more alarming — something that suggests the ethics issue is broader, and more deeply entrenched in federal Liberal politics than just the prime minister.

Here’s the paragraph — and then I’ll explain.

“On February 2, 2018, Mr. To met with Mr. Bruce and other SNC-Lavalin representatives in Ottawa as a follow-up to their meeting in Davos, Switzerland. The company presented Mr. To with a confidential discussion document outlining reasons in support of a remediation agreement regime and the company’s request for timely implementation of a regime via the federal budget. According to the document, this strategy would increase the likelihood of a settlement of the company’s pending criminal charges, of the company maintaining its head office in Canada for the foreseeable future and of an increase in its workforce.”

Mr. To was Justin To, Finance Minister Bill Morneau’s director of policy. Mr. Bruce was Neil Bruce, the CEO of SNC-Lavalin. Bruce, To and Morneau had met in Davos in January 2018 to talk about the company’s “challenges.”

The biggest of those challenges was that SNC-Lavalin had been charged on Feb. 19, 2015, with bribing foreign officials. A conviction would mean a 10-year ban from federal contracts, among other things, and SNC-Lavalin was hoping that a new process, a remediation or deferred prosecution agreement, would let the firm argue that it had cleaned up its act and have the charges stayed — hence, no criminal conviction, and the federal work could keep flowing.

So, the CEO of a company that was already facing charges met with government officials — safely far from prying eyes in Canada — to discuss new rules to lessen potential punishment for the company’s alleged misbehaviour. The firm lobbied to have those changes made, and even suggested tucking them into omnibus federal budget legislation — a move that would practically guarantee the new rules would pass with the smallest amount of scrutiny.

And then, magically, the new rules pop up exactly where the company suggested they should go, in the federal budget legislation. The 2018 budget was 582 pages: MPs only get so much time to review it, and defeating the bill means the government falls, so it’s going to pass, whatever’s in it.

That the rules appeared in the federal budget legislation at all was already something of a red flag.

Long before SNC-Lavalin and pressure from the Prime Minister’s Office became front page news, the oddity of seeing deferred prosecution rules appear in the budget had garnered attention.

I wrote about it in May of 2018: “Having a separate standard in criminal law (for companies) — the ability to buy their way out of prison with fines and promises of improvements — may make sense if your goal is to speed up the judicial process and to find novel ways to address internal company issues. But if you can’t see how easily such a regime could be abused to help a government’s corporate friends, then you are being wilfully blind. … That’s just making the commission of a crime into a business decision, balanced on the scale of profit and loss, rather than right and wrong.”

How does a company already charged with criminal offences get to have a hand in setting new ground rules for its own treatment?

Something is big-time rotten, and not in the state of Denmark either.