Evidence of meeting #13 for Access to Information, Privacy and Ethics in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was mulroney.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Norman Spector  As an Individual
Allan Rock  As an Individual

3:30 p.m.

Liberal

The Chair Liberal Paul Szabo

Good afternoon. I now call to order the Standing Committee on Access to Information, Privacy and Ethics. Today's order of the day is pursuant to Standing Order 108(2), the study of the Mulroney Airbus settlement.

Our first witness is Mr. Norman Spector, former secretary to the cabinet for federal-provincial relations from August 1986 to 1990, when he became chief of staff to then Prime Minister Brian Mulroney. In 1992, he was appointed ambassador of Canada to Israel and high commissioner to Cyprus. In August 1995, he returned to Canada when he was appointed by then Prime Minister Jean Chrétien as president of the Atlantic Canada Opportunities Agency.

Good afternoon, Mr. Spector.

3:30 p.m.

Norman Spector As an Individual

Good afternoon.

3:30 p.m.

Liberal

The Chair Liberal Paul Szabo

On December 15, 2007, the committee provided me with a list of priority witnesses to be called in regard to our study. Your name was included among them, and we thank you for accepting our invitation to appear before us today.

I would now ask the assistant clerk to please swear in the witness.

3:30 p.m.

As an Individual

Norman Spector

The evidence I shall give on this examination shall be the truth, the whole truth, and nothing but the truth, so help me God.

3:30 p.m.

Liberal

The Chair Liberal Paul Szabo

Thank you, sir.

As you know, the matter before us is very serious, and I hope you will not feel any undue influence in what you believe to be relevant and vital for the committee to hear. We expect you to clarify and/or help us to better understand certain matters brought before the committee. Refusal to answer a question is not an option. However, if you believe, sir, that there is any valid reason that a question should not be answered, I will hear your argument and make a ruling.

As a courtesy to our translators, I ask you not to speak too quickly. I will give you all the time you need to make your full statement before we proceed to questions from the committee members.

Do you have any questions for me before we begin?

3:30 p.m.

As an Individual

Norman Spector

It's clear.

3:30 p.m.

Liberal

The Chair Liberal Paul Szabo

Thank you very much. I now invite you to address the committee.

3:30 p.m.

As an Individual

Norman Spector

Thank you, Mr. Chair.

As you know, I am not delighted to be in Ottawa today. That has to do with the snow and the weather, it is true, but it also has to do with the climate here. I left this city in 1996 after I resigned from the public service of Canada.

I resigned from the public service in circumstances eerily parallel to my brief but still-shining moment with Karlheinz Schreiber, with one significant difference. When presented with the facts, Mr. Mulroney did not hesitate to do the right thing and declare Bear Head dead.

In 1996, had my deputy ministerial colleague at Public Works stood up to the very same minister who was piling pressure on us at ACOA, he could have nipped in the bud what became the sponsorship scandal.

Regrettably, efforts by your public accounts committee to minimize these situations in future are being frustrated by the government, as Mr. Gomery reminded us on the second anniversary of his report and of our not-so-new government.

Canadians who have been following the Mulroney-Schreiber affair have been seeing how Canada really works. The story is one of lobbyists and lobbying and of the power of the Prime Minister and his office. It's also a story about the media.

I can't help wondering whether you'd have launched these hearings back in 2001, with Frank Moores still alive to testify, had the National Post not killed the story of Mr. Schreiber's cash payments—a story that flew in the face of everything we thought we knew when the government paid Mr. Mulroney $2.1 million to settle his defamation suit—or maybe three years and not three months ago, had William Kaplan been interviewed on Politics or on The House or on any of the other programs that routinely feature far less significant books than A Secret Trial.

Can you imagine a newspaper in Canada killing a sensational scoop about a former Prime Minister that is today on everyone's lips? Frankly, it still boggles the mind.

I warn you, don't get me started on journalism in your questions. I spend most of my time these days reviewing the daily press on my website, and it's not always a favourable review.

Today I'm here to assist you in two specific areas, first on the Bear Head project, the reason you summoned me to Ottawa to appear today.

In 1995, I gave the RCMP, at its request, a sworn statement about what I knew regarding Mr. Schreiber's Bear Head project.

As you know, Ottawa was brimming with lobbyists in the 1980s. Some of them made a lot of money. One of them, Fred Doucet, had extraordinary access to the Prime Minister's Office. After he left PMO, he would still bring visitors to the PM's office on the Hill, upstairs. These appointments were not on our schedule and were unknown to me, unless I happened to chance upon them. This extraordinary access may explain in part why Bear Head refused to die even after Mr. Mulroney killed it.

As I wrote recently in Le Devoir, I can also help you identify the sources of the large amounts of cash that were brought back to 24 Sussex Drive.

Frankly, some of my neighbours were scratching their heads when they heard that you had invited Mr. Mulroney's ex-chef to testify, but I guess it's understandable in light of the possibilities conjured up over the years by François Martin's vivid Upstairs, Downstairs gossip.

The documents I've brought today, including two I've not written about before, identify a more prosaic source of this cash. As you will see from these documents, Mr. Mulroney and his family had an expensive lifestyle, and one can understand why he would have been somewhat preoccupied by what life after politics would bring, and perhaps this explains why he seemed eager to cater to the rich and powerful, as I described in the Kaplan afterword with anecdotes, one of which has never been reported.

I urge you, however, to keep your eye on the ball and not to get distracted by the kind of stuff that fills Frank magazine.

Around the end of Mr. Mulroney's second term, Canada was rated the fifth least corrupt country by Transparency International. When Mr. Chrétien left office we were twelfth. At the end of the Paul Martin interregnum we were fourteenth, which means that this town has a bipartisan problem.

A better way to look at it is that it also has a bipartisan solution, in that two parties are not centrally implicated in this problem, not having formed government. Since 2006 Canada has climbed back to ninth place, but as news out of Public Works last week suggested, we have a long way to go to ensure that the best country in the world is also the least corrupt country in the world.

In contrast to the leadership shown by Paul Martin when sponsorships hit the fan, I have grave doubts that Mr. Harper wants Airbus answers, and I also doubt that the proposed public inquiry will uncover where $10 million in “Schreibergeld” ended up.

The darker possibilities were captured by a Mulroney cabinet minister visiting the splendid new home of the head of Earnscliffe, then a Tory lobby firm, it may surprise some of you to know. Why is it so much more lucrative, he asked, to know Harvey André than to be Harvey André?

You are here today, and I'm not out walking my dog gazing at trees in first blossom, because the RCMP botched its Airbus investigation. And I hope that in drafting your final report you'll examine the special prosecutor system designed by your former colleague, and your former colleague, the Honourable Stephen Owen, in British Columbia. Meanwhile, this wretched process is Canadians' best hope for getting to the bottom of the story that was ignored by members of Parliament and suppressed to a remarkable extent by remarkably large sections of the media for a remarkably long time.

As a semi-retired public servant, it would have been easy enough to say no and go on enjoying life in Victoria when Mr. Kaplan asked me to contribute an afterword to his book, A Secret Trial, Brian Mulroney, Stevie Cameron And The Public Trust . You've come to the table late, but late is better than never, unless, that is, it is simply to dine out on partisan politics.

You have all the powers you need, and Mr. Ménard and Mr. Comartin have already set the example.

If you're truly serious about getting to the truth, you'll not hesitate to subpoena tax and bank records or to invite Mr. Mulroney back to testify, and you'll start pressing the government to offer Mr. Schreiber a deal to spill the beans--if he has any to spill, that is.

Thank you for your attention.

3:40 p.m.

Liberal

The Chair Liberal Paul Szabo

Thank you.

We'll move now to questioning.

Mr. Thibault, please.

3:40 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

Thank you, Mr. Chair.

Thank you for appearing before us today, Mr. Spector. I know you travelled far to get here in order to inform the people of Canada through this committee of the House.

3:40 p.m.

As an Individual

Norman Spector

I'm having trouble hearing you. May I use the earpiece? Go ahead.

3:40 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

You said in your column in Le Devoir, as in the one in The Globe and Mail, that you could tell the committee the sources of the money that came into 24 Sussex Drive. You said you could tell us where the money came from.

Would you care to do that now?

3:40 p.m.

As an Individual

Norman Spector

Certainly. Just one clarification. I said that I would be able to identify the sources of the cash brought back to 24 Sussex Drive. The word “rapportées” is the word that was used in the article in Le Devoir.

I have three documents, one is a package, and there were two specific documents. I will explain what I have and give all this documentation to your clerk.

In the first set of documents I'll present to you, you will see that Mr. Mulroney was being reimbursed around $5,000 a month by the PC Canada Fund for “expenses incurred as party leader”. Sometimes we would give this money to Mrs. Mulroney in cash; sometimes we would send a cheque to Alain Paris,

Mr. Mulroney's accountant in Montreal.

3:40 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

Before you go on, did you know how the money got to be in the PC Canada Fund? Have you ever been informed of that?

3:40 p.m.

As an Individual

Norman Spector

No. I was never on the party side.

3:40 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

Please go on.

3:40 p.m.

As an Individual

Norman Spector

I wrote about all this in the Kaplan afterword, which explains why the text I wrote in Le Devoir did not become a front-page story in Le Devoir and did not become a story in The Globe and Mail, both of which had the text. The reason it did not become a front-page story in Le Devoir and The Globe and Mail, whereas it did in La Presse, is that the reporters for Le Devoir and the reporters for The Globe and Mail had read the afterword, so they knew I had already written about this.

The first set of documents I have is on the reimbursement for personal expenses. One additional piece of information that may help is that, shortly before I left the Prime Minister's Office, I was told of a CCRA ruling defining these reimbursements as non-taxable; that is, they did not constitute income. So this is the first set of documents.

In addition to that, and I only learned this recently, it appears that Mr. Mulroney was being reimbursed for “personal” expenses by the PC Canada Fund. I have no knowledge of any aspect of this arrangement--any aspect. But the document appears to indicate, from the face of the document, that he was reimbursed slightly more than $100,000 for the nine-month period between October 1986 and June 1987.

3:40 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

In cash, again?

3:40 p.m.

As an Individual

Norman Spector

It does not specify. I should say there's absolutely no indication that it was cash, a cheque, or however.

On an annual basis this would amount to $135,000. That's the second document I brought.

The third document I brought is a summary of the PC Party inventory at 24 Sussex and at Harrington Lake. It shows that by around the time of the end of the first term in office, the party or the fund—I'm not sure, it may be the same thing--had spent $136,000 on furnishings at 24 Sussex Drive and $53,000 on furnishings at Harrington Lake. I will table that document as well.

Those are the documents I have, and that is what I was referring to. The latter two documents are new; I did not know about them. But as I wrote in the afterword, there was this arrangement.

3:45 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

At the time you were chief of staff, were you aware of any other money leaving the Prime Minister's Office, going to 24 Sussex, such as the allegations or suggestions about chef Martin?

3:45 p.m.

As an Individual

Norman Spector

Absolutely not.

3:45 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

Such as those suggestions.

3:45 p.m.

As an Individual

Norman Spector

Absolutely not.

3:45 p.m.

Liberal

Robert Thibault Liberal West Nova, NS

You personally transferred some of these funds into bank accounts?

3:45 p.m.

As an Individual

Norman Spector

The cheques were written to the chief of staff of the Prime Minister. This is an arrangement that went back to the first chief of staff and continued with subsequent chiefs of staff. As far as I know, it continued after I left, but I don't know that for a fact. But the arrangement was in place for the first, second, third, and I was the fourth chief of staff, so I know that they had an arrangement. The cheque was written to me or to my predecessors in trust. It was deposited, cashed, or whatever, and transferred to either the accountant or Mrs. Mulroney.