Information & Ethics Committee on Aug. 13th, 2008

[Richard Nadeau, Bloc, Gatineau, QC]

Thank you, Mr. Chair.

Ms. Downey, Mr. Roberts, Mr. Halicki, good afternoon.

Ms. Downey and Mr. Roberts, you know that the Prime Minister is in Newfoundland for a visit. I hope it will not cause you too much distress not to see him, knowing you could have seen him there. Nevertheless, we will make life pleasant for you here.

That being said, you have just heard a long diatribe from our colleague across the way about one way of seeing things. Elections Canada has identified irregularities during the 2006 election campaign on the part of only one of the 15 recognized political parties in Canada, and that was the Conservative Party of Canada. They are trying to put all the neighbours and the entire Canadian political family in the same boat as the Conservatives. Don't let the Conservatives pull the wool over your eyes, because they are very good at twisting the truth.

You are not entitled to transfer invoices. You can transfer money, but you can't transfer invoices. Mr. Roberts, if I understood what you said correctly, as official agent for Ms. Downey's campaign, you at no time had the authorization or opportunity to use the $7,700 for the campaign in your riding.

Is that correct?

[Darren Roberts]

That's correct. I had no individual say on where it went. That's correct.

[Richard Nadeau, Bloc, Gatineau, QC]

Right. So that money was deposited in your campaign account.

[Darren Roberts]

That's correct.

[Richard Nadeau, Bloc, Gatineau, QC]

How many hours or days or weeks later was it returned? Was the money returned to the national party during the campaign?

[Darren Roberts]

It was during the campaign. I'm not sure of the exact timeframe. It was a matter of days, I would think.

[Richard Nadeau, Bloc, Gatineau, QC]

Was it explained to you what the Conservative Party, the party for which Ms. Downey was the candidate, wanted to do with that $7,700?

[Darren Roberts]

It was for a media buy program.

[Richard Nadeau, Bloc, Gatineau, QC]

Right. As official agent, is there documentation, be it press clippings or radio or television advertising, that bears your designation—Darren Roberts, official agent for Cynthia Downey—and that says that you authorized the advertising using the infamous $7,700?

[Darren Roberts]

Are you asking if I authorized the type of advertising?

[Richard Nadeau, Bloc, Gatineau, QC]

Was advertising placed in a local newspaper, for example Le Gaboteur, in Cap-Saint-Georges? Did you give your authorization, as official agent, to place advertising showing Ms. Downey, using that $7,700?

[Darren Roberts]

No, there wasn't.

[Richard Nadeau, Bloc, Gatineau, QC]

So the money simply came in and went out. You have no idea what was done with it.

Did you, or the people in Ms. Downey's campaign, do business with Retail Media?

[Darren Roberts]

No sir, I have not, and I don't think anyone else had either.

[Richard Nadeau, Bloc, Gatineau, QC]

During the election campaign, which started in November and ended on January 23, 2006, did you hear that Retail Media was doing business with the Conservative Party to show Ms. Downey?

[Darren Roberts]

No, I did not.

[Richard Nadeau, Bloc, Gatineau, QC]

Thank you, Mr. Chair.

[The Chair, Liberal, Paul Szabo]

We have Mr. Martin, please, and then Madam Redman. Then I believe we'll be complete.

[Pat Martin, NDP, Winnipeg Centre, MB]

Thank you, Mr. Chairman.

I think one thing we've seen in the last few years is that advertising is absolutely key and critical in an election campaign. If you're going to run a modern, contemporary election campaign, your advertising buy and the application of that buy is absolutely critical.

Canadians have watched two years of agonizing through the Gomery commission with the sponsorship scandal. Now they're watching us wrestle with this advertising scheme, and they must be shaking their heads and wondering exactly what is up with the potential for abuse of election financing associated with advertising.

Let me lay this out. Here's what we think happened. The Conservatives spent the maximum they were allowed to on their national campaign, so they wanted to get more expenses, they wanted to spend more money, but they had to get it off their own balance sheet. So they transferred it to their ridings that had room in their election spending limits.

Now, it may in and of itself not even be wrong to transfer money. Well, we know it's not wrong to transfer money. To transfer expenses is. You cannot claim something that was incurred as a national expense as a local expense. The transfer agreements that you signed...I don't think you can delegate that authority to somebody else and then claim it as a local expense.

By all means, you could give money to your national campaign and they could spend it on a national advertising buy, but you can't claim it as a local expense. They would have to claim it as a national expense. So that's what went wrong here and that's what is convoluted about the pretzel logic of my colleague Pierre. They're trying to spin it their way. But if there was a widespread conspiracy to defraud Elections Canada by the Conservative Party, we're going to get to the bottom of it and it's not going to be tolerated.

Now, some of you were convinced that it was legal. Elections Canada doesn't think it was. In fact, they looked very closely at every riding in the country, all 308, and they found fault with 67 ridings of the Conservative Party candidates. What's galling to me is that we're here today, and nice people like you who offered to be candidates in election campaigns, I think, have been drawn, wittingly or unwittingly, into what is a conspiracy to defraud the Canada Elections Act and to overspend the national spending limit.

Do you agree it would be an unfair competitive advantage for one party to be able to spend $20 million on advertising when all the others are limited to $18 million?

[Cynthia Downey]

That is certainly not a fair way of doing things, and if I had had that $7,700 in my campaign during the election there would be a different member sitting in Ottawa right now. What happened in Random--Burin--St. George’s--done on our $18,000, I believe, which we spent in a month, and we came within 1,400 votes of the sitting member--shows me that had that $7,700 been spent on my campaign, or had the Conservative Party of Canada done anything in my campaign, there would be a different member there now.

[Pat Martin, NDP, Winnipeg Centre, MB]

Clearly that was a winnable seat, if you came that close with half a campaign or a third of a campaign. I understand.

This is what we're wrestling with here today. Clearly the Conservative Party is of the view that they can transfer their expenses to the local campaigns and then exceed the spending limits in an unfair advantage. But then to have the gall to submit those expenses as if they were local campaign expenses and be reimbursed by 60% and think that's justifiable because you have a harder time fundraising or something, that is appalling.

As far as being accountable to the taxpayer goes, that is bilking the taxpayer by bending, if not breaking, the rules of the Canada Elections Act. I don't know how you could see it any other way.

[Steve Halicki]

Mr. Martin, let me tell you how I see it.

Our campaign organization did not have the expertise or the experience to deal in the sophisticated world of modern media and advertising. It's much better to leave it to the specialists and those who have the experience to do that, and they existed in the party hierarchy. We've always freeloaded in the past on their expenditures for national advertising, and by our giving up some of our expense headroom in return for that service, that's a fair trade, and it's reasonable for both parties and was advantageous to both parties.

[Pat Martin, NDP, Winnipeg Centre, MB]

But, sir, you're not allowed to add your headroom to their maximum cap. When they've hit their cap, you can't take $20,000 of your freeboard in your canoe and add it on there, or they will be spending higher than they're allowed to spend on advertising.

[The Chair, Liberal, Paul Szabo]

Last question, please.

[Pat Martin, NDP, Winnipeg Centre, MB]

Elections Canada disagrees with you, and the rest of the country disagrees.