Ministers raised concerns about WE contract, top bureaucrat says
Charity’s ‘capacity’ to run student program brought up at cabinet, finance committee told
OTTAWA— As Ottawa considered awarding WE Charity a contract to administer a $912-million student volunteer grant program, no one in the public service or cabinet raised any red flags about potential conflicts of interests or the charity’s finances, said Canada’s top public servant.
But Liberal cabinet ministers did air concerns about the deal.
Ian Shugart, the clerk of the Privy Council, told MPs on the House of Commons’ finance committee that multiple cabinet ministers raised questions about WE’s capacity to administer the Canada Student Service Grant (CSSG).
“Ministers themselves at cabinet discussion raised issues about the capacity of WE Charity, about how it would reach out to under-represented students to ensure reach right around the country and various other matters, all of which would be reflected in the contribution agreement (between the government and WE),” Shugart said.
Shugart’s was a rare — if limited — pulling back of the curtain on cabinet deliberations, which are confidential by long-standing convention. And the clerk’s testimony showed there were internal questions about the deal well before it turned into a political headache for Prime Minister Justin Trudeau and the government.
These concerns appear to have extended beyond cabinet to Trudeau’s senior staff, including chief of staff Katie Telford.
Shugart said that when briefed on the CSSG program in mid-May, Telford impressed upon public servants that “care” and “due diligence” were required in partnering with WE Charity.
“The prime minister’s chief of staff, given the scale of the program, did make the point — which was accepted by everyone — that due diligence and care needed to be exercised with regard to WE Charity,” Shugart told MPs.
The Prime Minister’s Office did not immediately respond to a request for comment Tuesday.
WE has been under intense public scrutiny since the Star revealed the charity had been selected to run the CSSG on June 25. That scrutiny has extended beyond their relationship with Trudeau and the Liberal government to broader questions about how the international charity — co-founded by brothers Craig and Marc Kielburger — runs its operations, including the Kielburgers’s for-profit corporation ME to WE and their significant downtown Toronto real estate holdings. On Tuesday, WE pushed back against critics who have raised concerns about the relationship between its not-for-profit and for-profit ventures. WE asserted there are “clear internal controls” that have been “approved by auditors” to keep the two organizations distinct.
Shugart told MPs that while the public service did its due diligence in engaging WE to run the CSSG, that due diligence would have been limited to WE’s capacity to run the program — not the organization’s overall financial situation.
“In the cabinet discussion, ministers did raise questions of due diligence. So that part of the process was followed, as it would be in any other case,” Shugart said.
Shugart committed to provide the finance committee with “extensive documentation” about how the WE deal came together, including internal communications between the Prime Minister’s Office and Privy Council Office, the Department of Finance, and Employment and Social Development Canada — the department that was ultimately responsible for the program.
That documentation will likely be fodder for the ethics commissioner’s probe into whether Trudeau and Finance Minister Bill Morneau were in a conflict of interest when they participated in the cabinet discussion to award WE a service agreement to run the student grant program.
Trudeau’s mother and brother received $282,000 in speaking fees from WE between 2016 and 2020, while Morneau’s daughter is currently employed by the charity.
The committee is scheduled to resume its probe into the WE deal on Wednesday, with testimony from Morneau. Craig and Marc Kielburger are scheduled to appear next Tuesday.