Was due diligence done in WE deal?
Thousands of documents related to agreement have yet to be released
OTTAWA— Canadians are no closer to knowing what due diligence was done by the public service at Prime Minister Justin Trudeau’s request that justified a decision by the Liberal government to award WE Charity the contract to deliver a proposed $544-million student volunteer program.
Thousands of documents related to that mystery have still not been released. But Canadians do know more after testimony before the House of Commons ethics committee on Tuesday about what was not done:
á No one in the federal public service looked into the finances or governance stability of Craig and Marc Kielburger’s WE Charity organization and its offshoots.
á No public servants examined any other possible conflicts of interest like those that led to formal ethics investigations of Trudeau and Finance Minister Bill Morneau, which scuttled the government’s hopes of offering a “paid volunteer” program to students amid the pandemic.
á And even after Trudeau “pushed back” against what he says was the public service’s recommendation to use WE Charity, no one in the federal government told the charity to halt work it had already begun on the yet-to-be approved program.
Trudeau has said he had concerns that questions would be raised about possible conflict of interest, given his and his family members’ appearances at WE Charity events, and that he initially hoped the public service would deliver the program. “I pushed back. I wanted to be satisfied that the proposal that
WE Charity deliver the (Canada Student Service Grant program) had been properly scrutinized,” Trudeau testified on July 30.
Yet after testimony Tuesday by two ministers and top civil servants, a key question remained: Exactly what “due diligence” was done that allowed Trudeau, his chief of staff Katie Telford and other cabinet ministers who had discussed the matter at a cabinet committee to brush aside their early concerns and give a green-light to the program on May 22?
Trudeau has apologized for not recusing himself from that decision, saying he wasn’t aware of the extent of his mother and brother’s work and compensation by WE Charity. The Conservatives say it adds up to more than $500,000 paid to Trudeau’s mother, brother and wife.
Morneau also had to apologize for taking part in the cabinet decision that favoured WE Charity, an organization with which two of his daughters have ties. As the scandal was unfolding, Morneau repaid $41,000 for two trips he and his family took with the WE organization to Kenya and Ecuador.
Employment Services Minister Carla Qualtrough — who once appeared as an unpaid WE Day speaker in 2016 — said Tuesday that she could “offer no excuse” for Trudeau’s and Morneau’s failures, yet insisted that should not detract from the “fantastic work” the government has done in the months-long COVID-19 crisis.
“Yes, it was a pandemic and we were going at breakneck speed, but we should not have dropped the ball on this,” she said. “But they have apologized and I accept that apology and really hope we soon get back to our focus on delivering for Canadians.”
Minister of Diversity, Inclusion and Youth Bardish Chagger was the junior minister in charge of the grant program. She said Tuesday that despite
Trudeau’s expression of concern and demand to know why the public service could not deliver the program, nobody in government moved to halt work that WE Charity had begun on May 5.
WE Charity told the Star it began work on the program before cabinet had approved its selection, with the knowledge of federal officials. Under the formal agreement it had with the federal department of Employment and Social Development, WE Charity said it agreed to assume costs incurred if the arrangement wasn’t ultimately approved.
Chagger said public servants responded to Trudeau’s request for further due diligence by confirming in writing that no other organization could deliver the student grant with the “scope, scale and timeline” that the federal government required. Qualtrough backed that assessment, saying the federal public service was “stretched to the limit.”
Conservative finance critic Pierre Poilievre disputed that claim, and said it was “strange” nobody told WE Charity to suspend its work when the prime minister pushed back on its selection.
He said a similar program could have been delivered by grassroots organizations that have long administered the federal government’s summer jobs program for students, and he slammed Qualtrough for not overseeing the handling of the WE Charity agreement, calling it ministerial malpractice.
Poilievre also asked the country’s top public servant, Privy Council clerk Ian Shugart, if Trudeau had specifically sought “any information about the financial state of the organization” or “any evidence that the organization had a governance structure” on May 8.
Shugart said his “understanding” was that the prime minister “wanted assurance that the i’s were dotted and the t’s crossed. I am not aware that he found any particular gaps in the information … He was not satisfied, but he wanted greater assurance. I would not say that he pointed to any specific gaps in the information.”
Shugart said the public servants’ due diligence focused on the ability of WE charity to reach hard-to-access segments of population and deliver program in both official languages —“that sort of thing.”
And in his opinion, Shugart said, that due diligence was” sufficient.” Despite the revelations of internal conflict at WE Charity — the resignation of five of seven board members over a lack of financial disclosure — he said he still believes the organization could have delivered the program.
Chagger had little new to add to the behind-the-scenes timeline of how the program grew from a need identified by Trudeau and Morneau in a telephone conversation in early April, to a proposal from the public service, to the ultimately failed deal with WE Charity.
She told the committee she had just two interactions with WE Charity and co-founder Craig Kielburger since December 2019. That month, Chagger spoke at a WE Day event in Ottawa. The next interaction with Kielburger was a phone call on April 17 — five days before Trudeau announced the CSSG — originally reported by the Star.
Chagger testified the student services grant idea did not come up in their 30-minute conversation, which focused on an unsolicited proposal from WE Charity to mentor youth in social entrepreneurship during the COVID-19 crisis.
The opposition parties now await the release of some 5,000 pages of government documents from the Privy Council Office that detail the internal conversations about how WE Charity came to administer the program before backing away from it amidst the political scandal.