Finance Committee on July 21st, 2020

[The Chair, Liberal, Wayne Easter]

We'll officially call the meeting to order.

Welcome, all, to meeting number 42 and the first panel of the House of Commons Standing Committee on Finance today. We are meeting on government spending, the WE Charity and the Canada student service grant. Today's meeting is taking place by video conference, and the proceedings will be made available by the House of Commons website.

We're fortunate to have with us the Clerk of the Privy Council and Secretary to the Cabinet in this first hour, Mr. Shugart.

Welcome, sir. I don't believe you have an opening statement. If you do, that's fine. If you don't, we will go to questions.

I have a heads-up for questions by members. The lineup for the first six-minute round will be Mr. Poilievre, Mr. Fragiskatos, Mr. Fortin and Mr. Julian.

Mr. Shugart, the floor is yours.

[Ian Shugart, Clerk of the Privy Council and Secretary to the Cabinet, Privy Council Office]

Thank you very much, Chair and members of the committee. I'm glad to be here with you today.

You're correct, Chair. I do not have an opening statement. I'm here to answer your questions to the best of my ability and, Chair, I would suggest we get right at it.

[The Chair, Liberal, Wayne Easter]

That sounds good.

Mr. Poilievre, are you ready to roll?

[Pierre Poilievre, Conservative, Carleton, ON]

I am.

[The Chair, Liberal, Wayne Easter]

You're first up, for six minutes. The floors is yours.

[Pierre Poilievre, Conservative, Carleton, ON]

Thank you, Clerk Shugart, for your service to Canada. You are an excellent public servant and we're happy to have you here.

Speaking of the public service, when it recommends a nearly billion-dollar contribution agreement, does the public service do due diligence on the financial integrity of the recipient? That would be a yes or a no.

[Ian Shugart]

In general, yes.

[Pierre Poilievre, Conservative, Carleton, ON]

In this case of the WE Charity, Kate Behan of Charity Intelligence said of WE Charity's finances that when you scratch beneath the surface there are lots of red flags. Did anyone in the public service raise these red flags?

[Ian Shugart]

Not to my knowledge, Chair.

I would say that the due diligence is carried out primarily through the negotiation or the development of a contribution agreement, which was certainly done in this case. If there were obvious problems related to an organization that were related to the ability of the organization to carry out the objectives of the program—

[Pierre Poilievre, Conservative, Carleton, ON]

Right—

[Ian Shugart]

—that would be—

[Pierre Poilievre, Conservative, Carleton, ON]

—but there were no red flags.

Did anyone in the public service flag the publicly released audit that showed WE Charity was in breach of a 2018 bank covenant?

[Ian Shugart]

Not to my knowledge, sir, no.

[Pierre Poilievre, Conservative, Carleton, ON]

Did you discuss with the Prime Minister the WE Charity contribution agreement or the involvement of WE in this program before the proposal went to cabinet?

[Ian Shugart]

I did not personally have those discussions, Chair. I think it would be helpful for the committee to understand, and I'll be very brief about this, that the clerk is not always in the room where the decisions—

[Pierre Poilievre, Conservative, Carleton, ON]

Did anyone in the PCO?

[Ian Shugart]

Yes, PCO definitely. Definitely.

[Pierre Poilievre, Conservative, Carleton, ON]

On what dates?

[Ian Shugart]

There were briefings of the Prime Minister and the PCO before cabinet meetings. There was a briefing with the Prime Minister and PCO on May 21, for example. There may have been an earlier discussion upstream in the development of the program with the Prime Minister.

[Pierre Poilievre, Conservative, Carleton, ON]

What date?

[Ian Shugart]

I'll have to get the date to you.

I'm happy, by the way, Chair, to provide extensive documentation, including timelines, to the committee, which I'm sure will assist the committee in its work.

[Pierre Poilievre, Conservative, Carleton, ON]

Thank you, sir. We're looking for all the dates on which the Prime Minister and any member of the PCO discussed the Canada student service grant or the WE Charity. Did you ever discuss the WE Charity or any of its related organizations with the Prime Minister, yes or no?

[Ian Shugart]

Personally, no.

[Pierre Poilievre, Conservative, Carleton, ON]

Are you aware of any of your members of the PCO doing the same?

[Ian Shugart]

In the context of the suitability of a third party, and specifically the WE Charity as the third party, this was part of the cabinet discussion, and yes, the PM was briefed by PCO on it.