Government Operations Committee on Nov. 23rd, 2010

[Denis Coderre, Liberal, Bourassa, QC]

Okay. We can come back to that later.

There is one question I've been dying to ask right from the beginning. When you were having financial problems, you were infiltrated by the Hells Angels, and you came through all right. In order to get things back on track, you decided to deal with Gilles Varin with a view to securing a contract here, in particular. That is what I understood. You needed to be bonded, and L'Unique General Insurance Company provided you with a bond.

Given all your problems, how were you able to secure a bond from L'Unique General Insurance? That company must have done some background checks to find out whether you were having problems in terms of your financial and personal security. Please explain that. That's a neophyte question.

[Paul Sauvé]

Within the structure of our wonderful construction industry, both in Quebec and elsewhere, there are very close ties between the financial players—the bankers, lenders and insurance companies. The St. James United Church project, which caused a lot of ink to flow and, as I was saying earlier, cost my family and the creditors involved in the project almost $5 million, ultimately tarnished the company's financial reputation.

But in life, you have to get back on your feet, work hard and keep going, and that's what we did. In order to secure bonding and be able to move forward, we had to offer surety bonds in cash to the National Capital Commission. It is a fairly rare occurrence. Ordinarily we are able to obtain bonding on the basis of our word and our record. However, because our reputation had been tainted by the St. James United Church affair, there was an enormous loss--

[Denis Coderre, Liberal, Bourassa, QC]

You had problems. Where did that money come from? Did people from the outside help you secure bonding?

[Paul Sauvé]

No, not at all. The family came together to discuss the situation. We were on the verge of a recession. We knew that there would be major construction projects coming on stream in Montreal, in particular. So, we had to get involved in public projects. We therefore decided to dip into our own reserves in order to put a surety bond on the table and satisfy the National Capital Commission.

[Denis Coderre, Liberal, Bourassa, QC]

There have been lots of references to the Hells Angels and their hold on the construction and masonry industries. But they have to secure competency cards to do masonry work. Do they learn the trade in prison? They must be really good! Is that thanks to Leclerc Institution?

[The Chair, Liberal, John McKay]

Please be very brief.

[Paul Sauvé]

I know that an individual by the name of Guy Dufour, who was an FTQ union rep, tried in vain to come into our company so that FTQ members would get preferential treatment. As I was saying earlier, at the time, we tended to deal more with the large American union, the International. I believe Guy Dufour was arrested by the Sûreté du Québec as part of operation Diligence.

Bikers and their representatives in the FTQ have been working in the trenches to bypass the Quebec Construction Commission and secure competency cards using a shortcut. I think that is one of the results of the inquiry. Time alone will tell what else is involved. However, it is clear that, on construction sites, a number of people are bypassing the system in order to qualify as skilled workers.

[The Chair, Liberal, John McKay]

Thank you, Mr. Sauvé.

Mr. Gourde, you have five minutes.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

Thank you, Mr. Chairman.

Good morning, Mr. Sauvé.

On August 28, 2008, the newspaper Le Devoir published an article entitled “Profile: LM Sauvé or the ups and downs of a small family business in transition”. You made a specific comment to the reporter with respect to the Ottawa contract. This is what the article said:

The most recent contract is for $8.9 million for rehabilitation work at the West Block on Parliament Hill, a contract which was “secured following a call for tenders and with no political involvement”, he added.

Those are your own words that were reported in the article. Today you seem to be contradicting what you said to the reporter. Which version should we be relying on?

[Paul Sauvé]

What is your question, Mr. Gourde?

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

On August 28, 2008, Le Devoir published a company profile. The company was yours. I would just like to quote your comments as reported by the journalist.

The most recent contract is for $8.9 million for rehabilitation work at the West Block on Parliament Hill, a contract which was “secured following a call for tenders and with no political involvement”, he added.

That is what you said to the reporter. You alluded to a contract for the West Block. Today you seem to be contradicting what you said to the reporter from Le Devoir on August 28, 2008. Which version should the committee be relying on?

[Paul Sauvé]

Mr. Gourde, you can't always believe the interpretation presented by a reporter in an article. I don't have that article in front of me. So I can't comment on it.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

As regards your assertions, all the other witnesses seem to be saying that the content of that article reflects reality. However, you are asserting the opposite in your testimony today. Your comments seem to be at odds with what we have been told by other witnesses who appeared before the committee to discuss this very issue.

[Paul Sauvé]

Mr. Gourde, I'm seated quite comfortably on my chair. I don't feel though I'm at odds with anyone. Without wanting to contradict you, I'm afraid I don't understand the point of your questioning.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

I simply wanted to ascertain whether you agree with the content of the article. Your answer was that you don't recall. That's fine then.

At the beginning of your opening statement, you said that your father was active in the Liberal Party. Was that the provincial Liberal Party or the federal Liberal Party, or both?

[Paul Sauvé]

For many years, my father, along with my grandfather, Albert, who was chief mason at St. Joseph's Oratory at the time of Brother André—Brother Bessette… he began as an activist with the Union nationale. That was a long time ago. After that, when Mr. Lesage took office, there was a need for assistance, in particular in drafting laws to govern the construction industry. That goes back more than fifty years. The circumstances at the time were such that the Liberals were in power in Quebec.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

In that same article in Le Devoir, you were saying that you had set up a board of directors in your company to help you make the right decisions. You appointed Mr. Alexandre Trudeau to that board. Is that Mr. Justin Trudeau's brother—in other words, Pierre Elliott Trudeau's son?

[Paul Sauvé]

Yes, he is the son of Mr. Pierre Elliott Trudeau, the former Prime Minister of Canada.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

If he was a member of your board, you obviously knew him well. Did he have connections in the construction industry? Was he able to provide good advice? Why was he a director of your company?

[Paul Sauvé]

Certainly not because he was a Liberal. I believe he was completely apolitical. He is a very intelligent man, who had a lot to offer, particularly because of his travels, what he had experienced in Africa and his reports on major injustices. He had been down a rocky road and he was well-qualified to provide guidance.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

To help you secure contracts abroad or in Canada? To provide advice?

[Paul Sauvé]

Well, we were in fact considering turning our attention to contracts outside Canada, particularly Europe. He had a large network of contacts and considerable influence.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

In another article, Mr. Sauvé, you said that through your work on Parliament Hill, you had developed a desire to come to Ottawa every week. You even thought about running for the Liberal Party of Canada. You met with Mr. Coderre to explain that you were interested. How did that go? Was it productive?

[The Chair, Liberal, John McKay]

I'm sorry, Mr. Sauvé, but Mr. Gourde has not left you any time to answer that question.

Madame Bourgeois.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Thank you, Mr. Chairman.

Mr. Sauvé, I would like to come back to the cocktail party. According to you, did Minister Paradis know he was going to be attending a cocktail party with contractors who had won government contracts?