Evidence of meeting #49 for Public Accounts in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was zaccardelli.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Dominic Crupi  As an Individual
Jim Ewanovich  As an Individual
Giuliano Zaccardelli  Former Commissioner, Royal Canadian Mounted Police, As an Individual
Ron Lewis  Staff Sergeant (Retired), Royal Canadian Mounted Police, As an Individual
Fraser Macaulay  Chief Superintendent, Royal Canadian Mounted Police

3:50 p.m.

As an Individual

Jim Ewanovich

Thank you, Mr. Chair.

Many terrible and hurtful things have been said about me in this protected room, published in the newspapers, and spread across the media. I thank the committee for the opportunity to provide my side of the story. I have not had the opportunity to do this beforehand.

The first 22 years of my career were in progressively responsible HR positions as a public servant in the RCMP. I spent 12 years in the Treasury Board Secretariat in the HR policy branch, during which I was responsible for HR planning, business planning, departments, and led major initiatives, including interdepartmental committees for the renewal of the personnel community, the science community, and the IT workforce.

Recollecting my 34 years before rejoining the RCMP, I do not remember ever receiving a complaint or a grievance from employees, and definitely not ever discipline from management. I did receive awards, letters of commendation, and the Head of the Public Service Award. Indeed, my reputation was one of success, especially in building relationships with senior managers, departments, bargaining agents, and associations.

I was appointed in October 2000 following a competition as chief human resources officer. There appears to be a misconception about my role in the RCMP. The director of the National Compensation Policy Centre, NCPC, Dominic Crupi, did not report directly to me; he reported to the director general of human resources programs, a chief superintendent, who in turn reported to me. Indeed, there were five DGs who reported to me, with approximately 300 employees under my direction and another 1,000 across the RCMP.

When I arrived at the RCMP in 2000, the HR challenges for an organization of 24,000 members and employees across Canada were enormous. Quite frankly, it was described as the hardest job in the RCMP. I was recruited following the recommendation of the former commissioner to add civilians to the senior administrative positions in the RCMP. However, it is evident to me that, for whatever reason, there is still a certain faction within the RCMP that believes public servants should not hold office in senior positions.

Time does not permit me to discuss them all, but I'd like to discuss and explain a few areas that worked.

We established leading-edge succession planning, senior staffing, mentoring, and management and executive development. An overburdened grievance system, which had hundreds of grievances more than two years old, was revised and streamlined. RCMP Depot was refitted, ramped up to 1,200 candidates. We also proudly graduated the first Inuit troop for Nunavut.

Part II of the Canada Labour Code was implemented. Diversity in management exceeded government standards. We modernized an outdated classification system. A new comprehensive learning strategy was developed. Compensation issues were negotiated with Treasury Board. With the division representatives, we overhauled the labour management regime with a new constitution, bylaws, and assigned protocol with the commissioner.

We improved human resources information systems and had extensive workshops on internal investigations. We improved the promotion system. We resolved many issues for members in the north. An extensive project was undertaken to combine two categories of civilian employees to save $4 million to $5 million. We resolved HR issues surrounding summits, the G8 and other major events, including research completed on establishing a reserve force to handle unusual demands.

Firstly, I mention some of these because I am proud of the success we have with the long, hard work and cooperation of HR employees, division reps, and managers in resolving these issues.

Secondly, I mention them because, as far as I'm aware, none of the other programs or these issues or policies or projects under my responsibility had the financial issues or employment issues of the pension area. There was never any corruption that I was aware of under my responsibilities, and I deny any allegations that I was corrupt.

The pension initiative was only one of hundreds of issues on my plate. I became chair of the pension advisory committee in March 2001, wherein the pension outsourcing initiative was already in place. The committee consisted of deputy commissioners, two division reps, outside representatives, a retired member, representatives from the Solicitor General of Canada, legal service, and members from the office of financial institutions. This committee was supported by the director of NCPC and secretarial staff.

With respect to contracting, I did not participate in the selection or the management of contractors. I would like to explain, however, the actions that I took when flags were raised.

When I was approached in, I believe, early 2002 by senior representatives of finance and the director general, they advised me of irregularities and breaches of contracting rules by the director of NCPC, Dominic Crupi. As a result, I asked them to remove his contracting authority.

In June 2002, issues were raised by procurement and staff verbally about contracting expenditures, costs, and charges surrounding the pension project. As a result, I initiated the A-base review of HR funding and expenditures. This is the review that Ms. Denise Revine undertook and subsequently reported on in 2003.

A pension accounting unit approved by the pension advisory committee was set up in July 2002 to prepare financial statements to record, track, monitor, and report on financial activities. As well, the committee approved the creation of a PAC finance subcommittee to review the financial statements and monitor investment returns and administrative costs.

In April 2003, the advisory committee hosted officials from the Office of the Auditor General who reviewed the financial statements of the plan and stated that transactions of the plan that had come to their attention during the audit were found to have been in accordance with the RCMP Superannuation Act and Regulations.

In June 2003, the internal RCMP audit was launched, the results of which were not given to me until late November.

I'd like to discuss the hiring practices and the nepotism. I was approached by the director of staffing policy, I believe in April 2002, concerning the director of NCPC not following staffing rules. He apparently quoted me as saying that he could hire casuals. Yes, he did have the authority to hire casuals, but not to bypass RCMP staffing rules and regulations. I personally spoke to the director of NCPC and told him he must use staffing and the staffing process. Approximately six months later I specifically asked him if he had gone through staffing, and he stated, yes, he had followed the staffing rules.

In early 2003—April, I believe—I spoke to his supervisor, the director general, because it had come to my attention once again verbally that there were problems with the staffing in NCPC. I asked him to investigate. He advised me there were problems with the hiring of friends and family. I asked him to identify all the employees who had been improperly staffed and that none of them were to be extended or rehired. Once again I spoke to the director of NCPC and confronted him as he stated that he had followed the RCMP rules. I did not take further action as at this time I was advised that an internal audit was being launched.

It has been stated that my daughter was one of the hires in the pension area. I believe it is important to make clear that my daughter did not work in the pension area or anywhere that was under my direction. I state emphatically that I did not influence, ask, direct, or get involved in the hiring of my daughter. Anyone who says differently is simply not telling the truth.

There have been and are many generations of police officers and civilians who have a tradition of working in the RCMP. As well, there are many spouses and children of public servants who work in the government, all staffed through proper process.

I have now been through four Auditor General reviews, an RCMP internal audit, an internal investigation, and a year-long investigation by the Ottawa Police Service, which was conducted by thorough and professional investigators as well as an independent forensic auditor. It was found that all moneys were accounted for and that issues, while serious, were administrative in nature rather than criminal. I have not read in any of these reports that I was corrupt or responsible for fraudulent practices.

This committee is about accountability. When I read the draft RCMP audit report in October 2003, I was shocked at the seriousness of the findings. Although not directly responsible, I discussed it with the commissioner, and in spite of all the other successes, it happened under my watch, so I took accountability, stepped down, and resigned. Not satisfied with my leaving, three and a half years now after I retired, certain witnesses to this committee have turned to using vindictive character assassination as their offence.

I would be happy to answer any questions.

4 p.m.

Liberal

The Chair Liberal Shawn Murphy

Thank you very much, Mr. Ewanovich.

Mr. Crupi, you have an opening statement.

4 p.m.

As an Individual

Dominic Crupi

First, I would like to thank the committee for giving me the opportunity to speak here today.

When I was recruited by the RCMP, I was given a mandate to implement a web-based, industry-outsourced pension administration for members and retirees of the force. The RCMP had been advised by Public Works that the current system was obsolete, increasingly difficult to maintain, and could no longer be supported. In accordance with the mandate, we delivered a state-of-the-art system and administration for the RCMP, which currently has a pensioner satisfaction rate of over 90%.

This was done transparently and under the guidance and direction of the Treasury Board Secretariat, the senior management of the RCMP, and advisory and operations committees. All briefings, presentations, status reports, and factual matters were delivered to the senior management of the RCMP, Treasury Board, division representatives, advisory committees, Solicitor General staff, and Department of Justice representatives on a regular basis.

Treasury Board submissions were extensively reviewed by RCMP and Treasury Board Secretariat experts on a line-by-line basis, whereby budgetary requirements were demonstrated as where spending was to, and did, take place. Modifications and additions were made at the direction of Treasury Board and senior management of the RCMP.

It must be noted that when I was appointed director, the responsibility for budgets, financial coding inputs, spending authorities, and administration for the group fell under the purview of Chief Superintendent Macaulay. I no longer had individuals under my control who could do that. During this time, we were not permitted direct access to financial records or reports. Not until a pension accounting unit was created and given full access to the financial system in 2003 did this change. At no time was I ever told or asked by Mr. Macaulay or any of his staff to explain an action or a process, nor was I ever advised that we were doing anything wrong. I was not provided with any information or training in any of these areas.

I cooperated fully with the police investigations, the investigation that the allegations evolved into. It is my intention today to try, to the best of my ability, to assist in yours. I welcome the opportunity to explain the role I played in delivering and implementing this system.

Thank you.

4 p.m.

Liberal

The Chair Liberal Shawn Murphy

Thank you, Mr. Crupi.

Now we're going to move to questions by the members. As always, I urge members to make their questions short, relevant, and brief. We don't need long preambles.

I also urge the witnesses to keep their answers brief and to the point.

We're going to start with a first round of seven minutes. Mr. Wrzesnewskyj.

4 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

Thank you, Chair.

Mr. Lewis, at what point did you and the whistle-blower, Denise Revine, bring details of these serious allegations to Conservative members of Parliament, including a member of this committee?

4:05 p.m.

Staff Sergeant (Retired), Royal Canadian Mounted Police, As an Individual

Ron Lewis

To the members of Parliament, it would include my report of 2004. In February I went to the minister, the Auditor General, and the President of the Treasury Board. But directly to the members of this committee and the public safety committee, it would have been on November 6 that my covering report, which has been tabled with you, went to all the MPs on both this committee and the public safety committee.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

Thank you.

Mr. Ewanovich, former commissioner Zaccardelli appointed you as the chief human resources officer, which was the equivalent rank of an assistant commissioner, in part putting you in charge of the human resources at the RCMP. Did Mr. Zaccardelli discuss with you the fact that at that time you were what's called a “found harasser”?

4:05 p.m.

As an Individual

Jim Ewanovich

Yes, as a matter of fact, that was discussed.

What I explained to the commissioner, and what he understood from reading, is that upon greeting a member who I'd known years earlier and hadn't seen for some time, I commented, “You have lost weight”, which I meant as a compliment. Subsequently I found out that he had filed a harassment complaint against me. A witness to that particular incident, a regular member, stated that the comment was made neither sarcastically nor as a shot. I offered to apologize to that particular member and then found out that he had been off for three months on stress leave.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

You were a found harasser. The details of that we'll have to hear from other witnesses as well.

Mr. Zaccardelli addressed this with you, and notwithstanding that ethical lapse, you were hired.

Then a year later, an OPP investigation into the RCMP found that officials were receiving benefits from contractors, and there was a recommendation that you be fired.

Did Mr. Zaccardelli at least discuss this one with you?

4:05 p.m.

As an Individual

Jim Ewanovich

I am not aware of any recommendation that I be fired. As a matter of fact, the allegations were that I played golf and that I attended a hockey game. The investigation clearly showed that I did so with private contractors with whom I had no contracts. I had not negotiated any contracts with them, and I had not hired them for the RCMP.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

So Mr. Zaccardelli had not discussed—

4:05 p.m.

As an Individual

Jim Ewanovich

Firing me?

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

Yes.

4:05 p.m.

As an Individual

Jim Ewanovich

Not at all.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

That there was a recommendation.

4:05 p.m.

As an Individual

Jim Ewanovich

I'm sorry, if I may ask—

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

No, I'm the one asking questions, and you're to provide answers.

Mr. Ewanovich, that same OPP investigation obligated you to take ethics training. How did you find that training?

4:05 p.m.

As an Individual

Jim Ewanovich

It was a one-day training course on ethics.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

How did you find it?

4:05 p.m.

As an Individual

Jim Ewanovich

I found it very valuable. It's always useful to find out information on any subject.

4:05 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

Mr. Ewanovich, you mentioned golf as one of the elements of the OPP investigation. You and several golfing buddies were at St. Andrews-by-the-Sea. Those people included Mr. Gauvin, the comptroller of the OPP, who as a result of the OPP investigation also had to go for ethics training; and Mr. Crupi. You were all playing golf on what was supposed to be a working weekend on the RCMP's rank-and-file pension fund, except that instead of working for the pension fund, your golfing group was working the fund, benefiting from a scam that stole from it to play golf.

Is there anything you'd like to say to the rank-and-file officers whose pension fund this golfing weekend dipped into?

4:05 p.m.

As an Individual

Jim Ewanovich

Mr. Chair, I'd like to make it very clear that this was not a golfing weekend, nor are they my golfing buddies. There was a golf game, which a number of pension advisory committee members played. It was not a scam that I am aware of, and it certainly didn't take away from any pension funds that I'm aware of.

4:10 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

So you did not make any inquiries about who was actually paying for those expenses?

4:10 p.m.

As an Individual

Jim Ewanovich

I did not make inquiries, no, because when we arrived there was a complimentary ticket in the room.

4:10 p.m.

Liberal

Borys Wrzesnewskyj Liberal Etobicoke Centre, ON

We've seen the e-mail that arranged for those complimentary golf games.

I guess I should move on to Mr. Crupi, because it was your staffer, Mike McDonald, who spelled out in an e-mail the formula on how to defraud the pension fund to cover your golfing party with Mr. Ewanovich, Mr. Gauvin, and others.

You also hired Suzanne Beaudin to circumvent normal hiring procedures. It was referenced in the Auditor General's report that her salary cost taxpayers $443,000. The Auditor General stated that 49 out of 65 of these hires were family and friends. You also gave $800,000 out of the pension funds in 2002 and 2003 to central region for file data cleanup and to buy computers and such. As an aside, they had to hire four family and friends, including your step-daughter.

Why was Suzanne Perron, who was in charge in compensation in central region, so intimidated by you?