Government Operations Committee on Nov. 23rd, 2010

[The Chair, Liberal, John McKay]

I'd like to bring this meeting to order.

Good morning, members and witnesses.

We have with us Mr. Paul Sauvé and Mr. Michel Dorval. They have 10 minutes for a presentation.

I'll call upon Mr. Sauvé to commence with his presentation.

[Paul Sauvé, President, LM Sauvé]

Good morning, ladies and gentlemen. My name is Paul Sauvé.

I would immediately beckon this committee to stop my time, for we have learned about 20 minutes ago of the passing of Michel Dorval's father, Jean Dorval. Michel, who is with me today, had asked for continuance of this committee on Friday, at my request, and was denied. So I would appreciate a moment of silence before we begin, to honour the death of his 85-year-old father, who passed away 20-some minutes ago.

[The Chair, Liberal, John McKay]

Colleagues, if we could respect that minute of silence, please.

[A moment of silence observed]

Thank you, colleagues.

Mr. Sauvé, before you make your presentation, Mr. Coderre has a point of order.

[Denis Coderre, Liberal, Bourassa, QC]

Mr. Chairman, I would like the witness to be sworn in this morning.

[The Chair, Liberal, John McKay]

It's a committee discretion thing.

Do colleagues want the witness to be sworn in? Yes, please.

Thank you.

[Paul Sauvé]

I, Paul Sauvé, swear to tell the truth, the whole truth and nothing but the truth, so help me God.

[The Chair, Liberal, John McKay]

Thank you, Mr. Sauvé.

Thank you, Mr. Dorval.

We look forward to your presentation.

[Paul Sauvé]

I would like to have permission to present my PowerPoint presentation, which is available on the screen.

[The Chair, Liberal, John McKay]

I don't see anything out of order with that. That's fine.

[Paul Sauvé]

LM Sauvé Canadian Construction and Masonry Corporation is a family business that is 54 years old and has been practising the art of masonry across this great country. It was founded by my grandfather, Albert, and pursued by my father, Maurice. It has had many involvements in construction across Canada. A brief history would show that in 2004 we were awarded the restoration of the CSIS building in Montreal. We were cleared by security and all forces at Public Works to be awarded a $5.2 million contract.

Next is the St. James tower restoration project in Montreal, which was under way from 2001 to 2006. It is one of the most prestigious and historically relevant churches in Canada, and it was restored by our firm, with much involvement through public-private partnerships with the Quebec government and the City of Montreal.

The next slide shows the Hudson's Bay Company, Canada's largest retailer and second-largest in the world. We were awarded a $29 million campaign to restore all of their flagship stores and historical properties across Canada.

Our operations to this day--regardless of the difficulties that have been brought upon us from the loss of this great contract here, and the one for City Hall in Montreal--span across the country, with offices from Montreal to Victoria. Regardless of the difficulties we've suffered--just to dispel some of the queries that we had to file for bankruptcy and had disappeared from the map, which is not correct--we are in full operation. We would like to remind you of what we did last summer. I will show you some activities in Toronto, Winnipeg, Montreal, Vancouver, and Victoria.

I would like to break the ice on the St. James church project and discuss the great injustice that rests upon my family's company to bear the complete costs of the $4.7 million cost overruns, normally shared by all parties involved, which include the Quebec government and the City of Montreal.

This picture is from 2004, at the grand opening of the project. You can see Jacques Chagnon, from the Ministry of Public Security, and a slew of ministers from the Quebec government, as well as the mayor of Montreal, Line Beauchamp, Jean-Marc Fournier, and a few others.

I would like to attract your attention to why we hired a lobbyist when it came time to do the tower project. In 1994, Reverend Arlen Bonnar was involved as a partner in the project of the restoration of St. James and did not share in the burden of the costs of $4.7 million. I am told he has lately received from the Quebec government close to $1 million, which has not been redisbursed to the coffers of my family's corporation.

As you can well imagine, a $4.7 million cost overrun during the St. James project led us to ask for some help from financial partners.

I would like to dispel the issues that surround myself and others in my family regarding the involvement of the FTQ, and more precisely their “partners”, the Hells Angels.

We asked for help after the complete failure and loss of $4.7 million from one of the most trusted sources of union pension fund moneys in the country, and we were invaded by this particular gentleman, who was recently arrested.

I'll then talk to you about the projet de l'hôtel de ville de Montréal. The mayor of Montreal believed, as I've been told, that the restoration of City Hall could be a project to get us working again. So we bid competitively, and other than the fact that we had to go through a great number of loopholes to win this bid, we qualified in a cross-country competition.

Once we were awarded this bid, we discovered that one of the companies that was involved--to do the roof--had been disqualified in the tender package but had to be reintegrated into the team. Well, this member, Three Stars Roofing, lo and behold, was partners or in cahoots with the Rizzuto clan, as you saw in the pictures in the press last week. So there is a direct link between organized crime, large union contractors, and politicians.

I state for the record today, having heard from members of this clan, that I believe three councilmen who are presently serving for the City of Montreal, as well as the mayor himself, to be part and parcel of this controversy.

I will switch to the Peace Tower project in 1994 and explain to you why we've hired a lobbyist, which I believe is one of the reasons I'm here today.

In 1994, as a much younger man, I came to the Hill with my father to bid for one of the first projects that was to take place, the great restoration of our great Peace Tower. Upon depositing our bid in April 1994 at 10:30 a.m. in Hull, at Place du Portage, we were told by the clerk that the bid had to come in about 10 days later because of Fuller Construction's golf tournament. About 10 days later, when the bid came in, Fuller Construction was awarded the results. Fuller was involved with Carleton steel. Bobby Watt was the subject of quite some controversy here, and Richard Moore, who serves for MHPM, which is a partner with Public Works in the campaign to restore all of the buildings here, was then the president of Fuller Construction.

You can just imagine that as a boy from Quebec, coming on the Hill.... We decided this time around, 15 years down the road, to hire some help, and here are the Conservative connections we were told to use: Le Mas des Oliviers, the Conservative headquarters in Quebec; François Pilote, best friend of our Premier of Quebec, Jean Charest; Senator Claude Nolin; Gilles Varin; and Hubert Pichet. We got the contract, obviously because we paid and because we qualified; we had the qualifications.

Here's what we found out when we got here. You have an organigram with many players: Public Works; MHPM; Richard Moore, then president of Fuller Contracting, now acting for MHPM inside the Public Works office, leaking our bid sheet to a competitor and buoying himself to try to get our market, trying to get our job; Arcop architects, no collaboration; Revay, same engineers. There was no way in hell that we could make it through this unscathed, regardless of all the other difficulties that I just explained to you a minute ago.

I'll give you some of the explanations for which Public Works seems to think we were not up to par. It took us eight weeks--two months--to get electricity to our latrines and our construction shacks when we got to the Hill; seven months of quibbling over our schedule; one month for having been given erroneous civil engineering plans for a tunnel that we dug out that didn't exist, but that was there; two months of delay because of misplaced files and no plans coming to remediate; obviously slow payment, greatly affecting our cashflow, which led to our most recent financial difficulties; and a slew of road closures that didn't help us in the matter.

Then came the mediator to try to help, hired by Public Works, best friend of Norm Glouberman, president of Arcop architecture, Mr. Howie Clavier, who visited city hall and made it very clear that the crown would invoke our bonding company, La Capitale, to come finish the job. Since there was cross-collateralization between both projects, obviously the city hall project would get hit and hurt by that same token. So a cyclical effect of having taken our project away here also led to our bonded project in Montreal being taken away, two of the greatest projects we had, other than the Hudson's Bay Corporation project, at that time under way.

Ladies and gentlemen, the real tragedy here is not hiring a lobbyist. The real tragedy is that this work, which has been overly complicated by a slew of folks who work for Public Works, either through consultants or direct offices...it led this work to cost about $6 billion, where it could have cost just under $1 billion.

We have the competency to prove this, and yet we've been led astray in being able to prove that point. We never had a chance.

I sit here today humbled by this whole affair, and I'm ready to answer your questions.

Thank you.

[The Chair, Liberal, John McKay]

Thank you, Mr. Sauvé.

Colleagues, before I turn to Mr. Coderre, I note that the presentation is in English only. There are copies available, but I would need permission of the committee to distribute them.

Do I have that permission?

[Some hon. members]

No.

[The Chair, Liberal, John McKay]

It's no.

[Chris Warkentin, Conservative, Peace River, AB]

I don't know if it's a point of order, but for the benefit of committee members, there were a number of allegations brought forward in his presentation, and I'm wondering if Mr. Sauvé would have backup documentation for any of the statements he's made in his brief.

[The Chair, Liberal, John McKay]

Before Mr. Sauvé answers this particular point, these bullet points are bilingual, so they are distributable. That does speak to your issue.

[Chris Warkentin, Conservative, Peace River, AB]

Is that the backup documentation?

[The Chair, Liberal, John McKay]

Yes, these can be circulated.

While the clerk is circulating this, Mr. Coderre, you have eight minutes, please.

[Denis Coderre, Liberal, Bourassa, QC]

Good morning, Mr. Sauvé.

I would remind committee members that it is precisely for that reason that I wanted the witness to swear on the bible. His own honour is at stake.

I would like to address three issues. In any case, we have two hours available to us, so we will have plenty of time. Of course, there is the matter of the money, the contract and the cocktail party.

Just before we begin, I would like to ask you this: did you receive any threats that were intended to discourage you from appearing here today?

[Paul Sauvé]

No.

[Denis Coderre, Liberal, Bourassa, QC]

No one threatened you?

[Paul Sauvé]

No.

[Denis Coderre, Liberal, Bourassa, QC]

At the time of the city hall affair, you had received threats. You had bodyguards. Have you not been threatened since?

[Paul Sauvé]

Not since I made that information public, and I believe that was the best thing I could have done--

[Denis Coderre, Liberal, Bourassa, QC]

Please just give me a simple yes or no answer.

[Paul Sauvé]

The answer is that I received no threats.