EVIDENCE

Standing Committee on Access to Information, Privacy and Ethics NUMBER 012 1st SESSION 43rd PARLIAMENT Tuesday, August 11, 2020 Le mardi 11 août 2020 Standing Committee on Access to Information, Privacy and Ethics CANADA [Recorded by Electronic Apparatus] EVIDENCE August 11, 2020 Committee NUMBER 012 NUMBER 012 NUMÉRO 012 12 11 08 2020 2020/08/11 12:35:00 House Of Commons Comité permanent de l'accès à l'information, de la protection des renseignements personnels et de l'éthique Standing Committee on Access to Information, Privacy and Ethics ETHI Chair Ms. Rachael Harder 1 43

(1235) [ English ]

The Chair (Ms. Rachael Harder (Lethbridge, CPC)) :

I'll just ask the cameras to clear the room, please. Mr. Kurek.

Mr. Damien Kurek (Battle River—Crowfoot, CPC) :

Thank you, Madam Chair. On a point of order, I would ask that the witness be put under oath.

The Chair :

Okay, so be it. We will proceed under that direction. Welcome. As you know, Mr. Shugart, we are discussing the motion that was passed on July 22 at this committee:

That, pursuant to Standing Orders 108(3)(h), the Committee review the safeguards which are in place to avoid and prevent conflicts of interest in federal government procurement, contracting, contribution and other expenditure policies;

Mr. Shugart, you have been asked to come testify today as you currently serve as the Clerk of the Privy Council. In just a moment I will give you 10 minutes for opening remarks, and then we will proceed to questions from members around this table. I would ask that we be aware of the time. I will interrupt and stop questioning at the [ Inaudible—Editor ] minute. Please bear with me. I do not mean to be rude, but certainly I mean to be fair and to use our time wisely. With that, Mr. Shugart, I would— Yes.

[ Translation ]

Mr. Rhéal Fortin (Rivière-du-Nord, BQ) :

Madam Chair, there's no

interpretation at the moment.

[ English ]

The Chair :

I'm just going to suspend for one moment.

(1235) (1245) The Chair :

I will bring the meeting back. Mr. Shugart, you have 10 minutes to give opening remarks. Then we will proceed to questions from the members. Yes, Mr. Gerretsen.

Mr. Mark Gerretsen (Kingston and the Islands, Lib.) :

On a point of order, now that the meeting is back in session, I have a question on the issue that was raised by Mr. Green, who has now been replaced by Mr. Angus, with respect to asking the Clerk of the Privy Council to be put under oath. I want it to be known that I believe some other members of this committee misunderstood the manner in which the chair handled it, by assuming there was unanimous consent—

[ Translation ]

Mr. Rhéal Fortin :

Madam Chair, the interpreter can't hear the remarks.

[ English ]

The Chair :

Sorry, Mr. Gerretsen, just wait for one moment. I understand, Mr. Fortin. Thank you. I will suspend. We still have an issue with the

interpretation.

(1245) (1250) The Chair :

We're ready. Mr. Kurek.

Mr. Damien Kurek :

I'll withdraw the motion. It seems like this will take unnecessary time, so I will withdraw my previous motion.

The Chair :

Thank you so much, Mr. Kurek. With that, we will proceed to testimony from Mr. Shugart. Mr. Shugart, you have 10 minutes.

Mr. Ian Shugart (Clerk of the Privy Council and Secretary to the Cabinet, Privy Council Office) :

Madam Chair, I don't have an opening statement. Perhaps the only comment I would make is that I first began engaging with members of Parliament 40 years ago this summer. As a public servant, I have many times appeared before parliamentary committees. I understand absolutely the sacred rites of the House of Commons. Whether I were sworn or not, members of the committee would hear exactly the same thing from me. Thank you.

The Chair :

Mr. Shugart, thank you very much. With that, we'll proceed to questions from the members. Our first round is six minutes for each member who is asking questions. Mr. Barrett, you may begin.

Mr. Michael Barrett (Leeds—Grenville—Thousand Islands and Rideau Lakes, CPC) :

Mr. Shugart, I believe that the documents submitted to the finance committee would be useful for our study as well. Would you be able to provide them to this committee?

Mr. Ian Shugart :

I certainly would make them available to any committee of the House. I'm not familiar with the procedures across committees, but I would be absolutely prepared to make the same material available.

Mr. Michael Barrett :

Thank you. You supplied those per the deadline to the committee. I understand they are being vetted at this time. Are members of that committee able to see the documents in the same state they were submitted by you?

Mr. Ian Shugart :

As far as I know, Chair, again, I believe the law clerks of parliamentary committees do some examination of the documents. I gather there are still some translation issues, so what will be provided and has been provided is entirely in the hands of the committee, at that point.

Mr. Michael Barrett :

The Prime Minister testified that he pushed back against your recommendation on May 8 before the cabinet meeting, saying that you hadn't ensured that i’s were dotted and t’s were crossed and that he demanded due diligence be done. Did that conversation happen electronically or in person?

Mr. Ian Shugart :

It was in person, but I would mention that during this entire period, because people have been working at a distance, typically in our briefings of the Prime Minister , certainly by the time he was no longer in isolation, it would have been a mix of people in the room and on the phone.

Mr. Michael Barrett :

Is there a recording? Would those meetings be recorded if they're by Zoom or by the Government of Canada teleconference system?

Mr. Ian Shugart :

I can't be definitive; I assume not. I do know that in one case where I was asked to provide a Zoom recording of a particular meeting and I undertook to do so, if there were a recording, it transpired that there was not a recording. So to the best of my knowledge, there were not recordings of meetings.

(1255) Mr. Michael Barrett :

Thank you. Did the Prime Minister ask for hard proof that the public service could not deliver the CSSG?

Mr. Ian Shugart :

Well, the questions were specific, and the answers, I think, were taken as honest and true answers. It was a serious question and taken as such. Officials gave their best answers.

Mr. Michael Barrett :

But did he ask that question specifically? Because—

Mr. Ian Shugart :

You mean for documentary evidence, for example?

Mr. Michael Barrett :

Yes.

Mr. Ian Shugart :

No, he did not as I recall.

Mr. Michael Barrett :

Did he ask if, for example, the WE organization had a functioning board that was governing it?

Mr. Ian Shugart :

No.

Mr. Michael Barrett :

Did he ask if they were in violation of any of their bank covenants?

Mr. Ian Shugart :

No.

Mr. Michael Barrett :

Did he ask if their financials were in order?

Mr. Ian Shugart :

No. I think he entrusted public servants to do their due diligence with respect to the proposed contribution agreement and the program that would be delivered.

Mr. Michael Barrett :

Did he ask that you provide other options for organizations that could provide this service?

Mr. Ian Shugart :

Well, as we indicated to the finance committee chair, there was extensive discussion, prior to the briefing of the Prime Minister and then again at the May 8 briefing and the subsequent briefing, that the due diligence had been done. As parliamentarians know, there was no formal call for proposals, but officials were thorough in understanding given the parameters of the program.

Mr. Michael Barrett :

Was the question asked if this organization could deliver the program in both of Canada's official languages in accordance with the Official Languages Act?

Mr. Ian Shugart :

Yes.

Mr. Michael Barrett :

And was the answer that they were able to?

Mr. Ian Shugart :

Yes.

Mr. Michael Barrett :

Are you aware that the WE organization was going to subcontract out 100% of the French delivery of the program?

Mr. Ian Shugart :

No, I'm not aware of that.

Mr. Michael Barrett :

You haven't seen media reports to the effect that they had NATIONAL Public Relations contracted as their sub to deliver in French-speaking communities?

Mr. Ian Shugart :

I'm not aware of that.

Mr. Michael Barrett :

The Prime Minister said he wanted to make sure i's were dotted and t's were crossed in the two weeks between that cabinet meeting and the next. What due diligence would have been done during that time that wasn't done previously, up to that point on May 8?

Mr. Ian Shugart :

Well, I think we have indicated that the kind of due diligence with respect to the ability of the organization to deliver the program had to do with official languages in one case, the ability to reach out across the country—in other words, take care of all the regional dimensions—and ensure that Canadians who are typically harder to access, disadvantaged people and so on, would be able to be reached by—

Mr. Michael Barrett :

Sorry, I'm tight for time. I have one more question. When you appeared at the finance committee, you said, “the Prime Minister was briefed [on the CSSG] prior to cabinet meetings and on at least one other occasion discussing the development of the program, the options, the design features, etc.” That's a quote from you. What was the date Mr. Trudeau was briefed about program development and options?

Mr. Ian Shugart :

If I remember correctly, it was late April, April 21 perhaps, when the broad outlines of the entire package for students were being briefed.

The Chair :

That's time, thank you. Madame Brière, go ahead for six minutes.

[ Translation ]

Mrs. Élisabeth Brière (Sherbrooke, Lib.) :

Thank you, Madam Chair. Good afternoon, Mr. Shugart. Thank you for accepting the invitation to join us this afternoon. Could you just explain how the file progresses once it gets to the Privy Council Office?

Mr. Ian Shugart :

There is a preliminary period during which officials from Employment and Social Development Canada, or ESDC, and the Department of Finance outline the program and develop the details. I don't have the specific dates right now, but at some point during that period, officials from the Privy Council Office were informed and invited to take

part in the conversations. In terms of overall development of the program, the details were becoming more and more established, and the discussions more detailed. The role of the Privy Council Office is to prepare elements of the proposal for consideration by the Special Committee on the COVID-19 Pandemic and, ultimately, by cabinet.

(1300) Mrs. Élisabeth Brière :

Thank you. You mentioned that, in the circumstances, it was justified to proceed with a contribution agreement, which is a standard tool, rather than a tendering process. Today, can you tell us why it was justified?

Mr. Ian Shugart :

It's a standard mechanism for working with a— [ English ] third party to deliver a program. It was already determined at that point that the elements of the program required a third party, and therefore a contribution agreement would be required. The contribution agreement itself follows the broad lines of any contribution agreement. There are standard clauses. There's a template for contribution agreements to ensure financial probity and results for Canadians, and that took some time to develop, as it always does.

The more sophisticated or complex, and the larger scale of program, the more detailed the contribution agreement will be. That procedure was followed when it became clear that the department did not have the internal capacity to deliver the program that was being designed.

[ Translation ]

Mrs. Élisabeth Brière :

When you were appointed, you said that it was your responsibility to advise ministers, and to tell them the good news and the bad news. Under both Mr. Harper's government and that of Mr. Trudeau , you have always considered it your duty to tell the truth and to give them the best possible advice. I believe you expect the same from all deputy ministers in the government. Along the way, if you had doubted that WE Charity was the best option, would you have said so?

Mr. Ian Shugart :

Yes. I wouldn't have said it personally. That was the opinion of senior officials at Employment and Social Development Canada. I didn't give that advice myself, but it was already the opinion of senior officials at ESDC at the time.

Mrs. Élisabeth Brière :

Okay, but I would like some clarification on your sense of duty and your responsibility to always advise ministers to the best of your ability.

Mr. Ian Shugart :

This is absolutely consistent with the duties of public servants to consider options and to respond to ministers' requests in light of established program development preferences. That's normal and that's what was done in this case. The advice and analysis of senior officials was provided to ministers as usual.

Mrs. Élisabeth Brière :

In the Privy Council Office are there mechanisms, such as due diligence procedures, in place to identify areas of concern and potential conflicts of interest?

(1305) Mr. Ian Shugart :

Everything is based on the Conflict of Interest Act. As the committee knows, it is the responsibility of individuals to make their business known to the commissioner. If the commissioner deems that action is necessary, it's the responsibility of senior officials or ministers—

[ English ]

The Chair :

I'm sorry, that's time. Thank you.

[ Translation ]

Mrs. Élisabeth Brière :

Thank you.

[ English ]

The Chair :

We'll move to Mr. Fortin for six minutes.

[ Translation ]

Mr. Rhéal Fortin :

Thank you, Madam Chair. Good afternoon, Mr. Shugart. With respect to the due diligence of WE Charity, you said earlier that Mr. Trudeau had not inquired about this, but that he assumed the officials had. Can you tell us exactly what due diligence was done on WE Charity's activities?

Mr. Ian Shugart :

I indicated earlier that the due diligence had to do with the organization's ability to deliver the program. Other issues related to the organization, such as those related to the board of directors, were not considered at that time.

Mr. Rhéal Fortin :

In terms of the financial aspect, was the creditworthiness of WE Charity checked?

Mr. Ian Shugart :

No, because senior officials said that they had dealt with the organization before, that there was a track record. The content of the contribution mechanism is specific enough to determine that expenditures, for instance, are well managed. This kind of due diligence also assesses the organization's ability to deliver the program and interact with citizens, among other things.

Mr. Rhéal Fortin :

I don't mean to be rude, Mr. Shugart, but we have so little time that I feel compelled to corner you. Please excuse me. You said that this organization has an established track record and that it was enough to judge them on it. What was the duration of the track record of WE Charity that reassured you?

[ English ]

Mr. Ian Shugart :

I’m afraid I don’t know the details of that. The department had worked with the charity on other occasions. They knew them well.

[ Translation ]

Mr. Rhéal Fortin :

Do you know that the contribution agreement was not given to WE Charity, but rather to the WE Charity Foundation?

Mr. Ian Shugart :

Yes, I learned that recently.

Mr. Rhéal Fortin :

Do you know how long the WE Charity Foundation has been incorporated?

Mr. Ian Shugart :

No.

Mr. Rhéal Fortin :

Do you know how solvent the WE Charity Foundation was and how many assets it had, among other things?

Mr. Ian Shugart :

I only know that in conversations between ESDC officials and WE Charity people, it was determined, partly for administrative reasons, that the WE Charity Foundation was the best vehicle.

Mr. Rhéal Fortin :

I don't know the exact figure off the top of my head, but WE Charity had liabilities of a few tens of millions of dollars. Did you know that?

Mr. Ian Shugart :

I don't know the details, but I understand that there are—

Mr. Rhéal Fortin :

If I told you that the WE Charity Foundation had no known assets, would you believe it's possible?

Mr. Ian Shugart :

I have no specific information on that.

Mr. Rhéal Fortin :

How often does the federal government give $43.5 million in contracts to manage $900 million to empty shells that have no assets and no known track record?

[ English ]

Mr. Ian Shugart :

All I can say, Chair, is that the contribution agreement in this case was typical of relationships between a government department and an entity. They are guided by principles of audit and of due diligence with respect to the interest of the Crown. This contribution agreement will bear scrutiny as typical of the mechanisms that have been approved by the Treasury Board and that have been used in the government for a very long time.

(1310) [ Translation ]

Mr. Rhéal Fortin :

I'll take your word for it, Mr. Shugart. It seems to make sense to me. I can't believe the federal government put an organization in charge of managing $900 million of our savings, or even our children's future savings, because we don't have that money and have to borrow it, without any due diligence. I can't believe we paid an empty shell, with no assets, without checking anything. It seems absurd to me. That's why I'm asking you to reassure me, because you're still the Clerk of the Privy Council. You advise the Prime Minister on these things. You have been involved in these decisions.

Yet you're telling me that there was no financial due diligence and that you simply relied on the fact that the department had already dealt with WE Charity and on the fact that they knew these people. That doesn't make me feel any better. Can you tell me anything else to make me feel better?

Mr. Ian Shugart :

You're absolutely right about the government's responsibility to reassure Canadians about the reliability of things. I would simply say that there was an established relationship between WE Charity and the department. As I mentioned before, I don't know the specific reasons why the vehicle was transferred between WE Charity and the WE Charity Foundation. However, I can say that the procedures and rules were followed in terms of carrying out this contribution agreement.

Mr. Rhéal Fortin :

I have one last question for you, Mr. Shugart. My colleague asked you about this earlier. On May 8, the Prime Minister backed down because he felt he might be in a conflict of interest in this matter. The decision to award the contract to WE Charity was postponed for two weeks. That is part of the story, and we now know that two weeks later, Mr. Trudeau and Mr. Morneau voted in favour of the decision. Between May 8 and May 22, were you consulted on whether or not a conflict of interest prevented the Prime Minister from making a decision?

[ English ]

The Chair :

You have 10 seconds for your answer.

Mr. Ian Shugart :

I was generally aware, because the item had been removed from the cabinet agenda, that there was a desire for due diligence on the part of the Prime Minister 's chief of staff and the Prime Minister, and that that would be undertaken between the two cabinet dates. I was not personally involved in that due diligence. My opinion was not sought, and I did not see anything at the time that required my giving the Prime Minister specific advice.

The follow-up to his request was being undertaken by officials and it did not occur to me at the time, or indeed in retrospect, as I've thought about this, that there was anything in that circumstance that called for more than the follow-up that was being done by officials.

[ Translation ]

Mr. Rhéal Fortin :

Do you have a copy of the report?

[ English ]

The Chair :

Mr. Green, the floor is yours for six minutes.

Mr. Matthew Green (Hamilton Centre, NDP) :

Thank you very much. This is a very interesting line of questioning. Through you, Madam Chair, who would have provided the due diligence in this regard?

Mr. Ian Shugart :

Well, those who did the follow-up, Chair, which is to say ESDC officials who had carriage of the file, and the Privy Council Office would have been monitoring that as well.

Mr. Matthew Green :

So you would have been providing advice to Ms. Telford in this regard of due diligence?

Mr. Ian Shugart :

Well, the nature of our advice was when the item returned, the homework having been done by the officials, and the Prime Minister was again briefed prior to the cabinet meeting—

Mr. Matthew Green :

In your opinion, was the due diligence sufficient?

Mr. Ian Shugart :

In my opinion, it was.

Mr. Matthew Green :

How does Ms. Telford, in her testimony before the finance committee, state that she didn't even know the contract was with the WE Charity Foundation?

Mr. Ian Shugart :

At that time, we did not know that information.

Mr. Matthew Green :

How is it that you—not you personally, but through you, Madam Chair.... How is it that during this due diligence process nobody read the 2019 audited financial statements that WE Charity was in breach for the second year?

(1315) Mr. Ian Shugart :

Well, I've indicated that the focus of that due diligence was on the ability of the organization to deliver the program—

Mr. Matthew Green: Would due diligence—

Mr. Ian Shugart: —and in the interactions with the organization—

Mr. Matthew Green :

Which one? Just for clarity, Madam Chair, which organization?

Mr. Ian Shugart :

With WE Charity.

Mr. Matthew Green :

With WE Charity Foundation?

Mr. Ian Shugart :

As I understand, they made the suggestion.

Mr. Matthew Green :

Specifically, through you, Madam Chair, was it WE Charity Foundation, for the record?

Mr. Ian Shugart :

No. I'm going to say that WE Charity, as far as I'm aware, made the suggestion that the WE Charity Foundation would be the better vehicle.

Mr. Matthew Green :

Madam Chair, through you, in the due diligence process, who would the due diligence be applied to, the WE Charity Foundation or WE Charity proper?

Mr. Ian Shugart :

The same issues.... I don't know at what point the focus shifted from the WE Charity to the WE Charity Foundation. I do not know if it would be the same individuals responding on the other side to both parts of the organization. I can tell you that the officials were focused with their interlocutors at WE on the due diligence, the ability of the organization to deliver the program.

Mr. Matthew Green :

Madam Chair, through you to Mr. Shugart, I apologize. I can't accept that in a $43-million administrative exchange to administer a $912-million program that the governance of the WE Charity Foundation wouldn't have been a part of the due diligence process, so I'll put the question clearly. Was the governance of the WE Charity Foundation's stability part of the due diligence process, knowing that they were going to, as a shell company, hold the liability?

Mr. Ian Shugart :

Chair, I understand completely the question and its legitimacy. I have every confidence that going forward we will learn from this situation whether those questions should have been examined. I'm not in a position to give the detail on the negotiation of the contribution agreement between ESDC officials and the WE organization broadly.

Mr. Matthew Green :

Through you, Madam Chair, that's not what I'm asking. I'm asking whether in your report back on the due diligence the governance structure of the WE charitable foundation was part of the due diligence? I'll explain why. It has been reported by Charity Intelligence that in the due diligence the process was whether the charity was able to provide full and frank disclosure to the founder about the radical change in its governance. For instance, none of this would have come to light until the June 28 tweet of the former chair Michelle Douglas, which showed that the board of directors had gone from seven to five.

That's a radical departure. I've been a part, Madam Chair, of many processes. I've been a member of the Hamilton Community Foundation. I've been on the endowment fund for the City of Hamilton, the enrichment fund. I can assure you that if there were a radical departure by the board of an organization that I was about to present money to, without any real explanation, that would raise a flag. Yet in your testimony, through you, Madam Chair, Mr. Shugart, you suggested there were no flags raised. How is that?

Mr. Ian Shugart :

I've been very clear, a few times now, in answering your question to say that those issues with respect to the WE Charity Foundation were not raised in the subsequent briefing. To my knowledge, they were not flagged as material in the examination of WE's ability to deliver the program.

Mr. Matthew Green :

Is that still your opinion, with all the information that's been disclosed since then?

Mr. Ian Shugart :

In retrospect, I think if we had known what we know now, we probably would have inquired further, but I must also say that even looking back now, I have no evidence that the WE organization, had the program gone ahead, would not today be able to deliver the program as set out in the contribution agreement.

Mr. Matthew Green :

This will be my last question. With regard to the April update that you referred to following the previous speaker's question, was the Prime Minister briefed at the time that he was involved, back in April? We know that Ministers Chagger , Ng and Morneau were already heavily involved with WE. Did the Prime Minister know at that time during your briefing that WE was on the docket for this particular program?

Mr. Ian Shugart :

My understanding is that he did not.

Mr. Matthew Green :

I don't see how that's possible.

The Chair :

Thank you. Mr. Poilievre, you have the floor for five minutes.

(1320) Hon. Pierre Poilievre (Carleton, CPC) :

So the Prime Minister had no idea how the program would be delivered when he announced the program on April 22.

Mr. Ian Shugart :

The details of the design of the program had yet to be worked out. The policy was what the Prime Minister announced. The details were to be fleshed out later.

Hon. Pierre Poilievre :

“Later” came on May 8. At that meeting, was the Prime Minister's family's relationship with WE ever raised by anyone?

Mr. Ian Shugart :

It was not, that I recall. The Prime Minister's own history with WE was—

Hon. Pierre Poilievre :

No, I know that.

Mr. Ian Shugart :

—but beyond that, sir, no.

Hon. Pierre Poilievre :

Was it raised at all?

Mr. Ian Shugart :

I do not believe it was.

Hon. Pierre Poilievre :

You do not believe so.

Mr. Ian Shugart :

To the best of my knowledge, the answer is no.

Hon. Pierre Poilievre :

You were there.

Mr. Ian Shugart :

Either I was there or my colleague Phil Jennings, who's deputy secretary at PCO was. I would refer—

Hon. Pierre Poilievre :

Did the Prime Minister ask, at that meeting, for evidence that the public service could not deliver the program?

Mr. Ian Shugart :

Well, as I said to the earlier question, this was oral, but yes, he asked for an understanding of the capacity of the public service, which was provided.

Hon. Pierre Poilievre :

Did he ask for any information about the financial state of the WE organization?

Mr. Ian Shugart :

No.

Hon. Pierre Poilievre :

Did he ask for any evidence that the organization had a governance structure?

Mr. Ian Shugart :

Do you mean difficulties with that? No.

Hon. Pierre Poilievre :

He effectively said that your public service did not cross t's or dot i's, and that you did not provide him with enough scrutiny at that meeting. What did you lack? What did the public service fail to tell him that made him “push back”, in his words?

Mr. Ian Shugart :

My understanding of what the Prime Minister has said is that he wanted assurance that the i's were dotted and the t's crossed.

Hon. Pierre Poilievre :

But they weren't—

Mr. Ian Shugart :

I am not aware that he found any particular gaps in the information.

Hon. Pierre Poilievre :

Well, he must have, because he claims—claims—that he pulled the document from the cabinet meeting.

Mr. Ian Shugart: Yes—

Hon. Pierre Poilievre: So he must have found a gap.

Mr. Ian Shugart :

Well, he was not satisfied—

Hon. Pierre Poilievre :

Why not?

Mr. Ian Shugart :

—but he wanted greater assurance. I would not say he pointed to any specific gaps in the information.

Hon. Pierre Poilievre :

Did he give you a list of due diligence that he wanted?

Mr. Ian Shugart :

Yes. We've referred to that as issues related to—

Hon. Pierre Poilievre :

There's a list?

Mr. Ian Shugart :

We discussed this in the meeting. I've referred to what those topics were: the ability of the organization to reach harder-to-access Canadians, bilingualism, regional reach and that kind of thing.

Hon. Pierre Poilievre :

But he didn't ask about finances or governance, obviously, which would be necessary for an organization to deliver a program, and yet somehow he claims that he was seeking due diligence. Has the WE organization repaid the money it received from the government yet?

Mr. Ian Shugart :

I believe that is in process, but I haven't the details off the top of my head.

Hon. Pierre Poilievre :

It still has the money, as far as we know.

Mr. Ian Shugart :

We'll have to provide that information, Chair.

Hon. Pierre Poilievre :

The ESDC had carriage of the file, yet no minister from ESDC signed off on the contribution agreement. How many times have you seen a department do a contribution agreement with a funding recipient without the minister signing off?

Mr. Ian Shugart :

In fact, Minister Chagger was the responsible minister. She did sign the contribution agreement.

Hon. Pierre Poilievre :

She's not with the ESDC, so she's not with the department that—

Mr. Ian Shugart :

She is, by order in council, associated with ESDC for the purposes of the relevant programs.

Hon. Pierre Poilievre :

When was she granted signing authority for this agreement?

Mr. Ian Shugart :

We would have to confirm that for you. I think it might have been in March, but I would have to confirm that.

Hon. Pierre Poilievre :

When did the employment minister decide not to sign either the MC or the contribution agreement?

Mr. Ian Shugart :

The employment minister was not the responsible minister for the purposes of the program. Beyond that, I can't say.

Hon. Pierre Poilievre :

I've never borne witness to a non-ESDC minister signing an ESDC contribution agreement and an ESDC memorandum to cabinet. It is bizarre that none of the ministers who are actually with that department would have been involved in either of those two submissions.

Mr. Ian Shugart: But the—

Hon. Pierre Poilievre: It suggests neither of them wanted to have their name on this.

(1325) The Chair :

Mr. Poilievre, that is time. You can give a quick response.

Mr. Ian Shugart :

I want to be very clear that Minister Chagger was associated with the department for purposes of programming related to youth, done by order in council, and that is not unprecedented at all. A minister can be effectively cross-appointed to another department for purposes of program responsibility. That's what happened in this case.

The Chair :

Thank you. We'll move on to Ms. Zahid for five minutes, please.

Mrs. Salma Zahid (Scarborough Centre, Lib.) :

Thank you, Chair. I will be sharing my time with my colleague Mr. Gerretsen. Thank you, Mr. Shugart, for appearing before the committee. Thank you for all the work you do on behalf of all Canadians. Over the last five months, there has been a lot of discussion about the capacity of the public service to deliver programs like the Canada student service grant.

I know that our world-class public servants adapted during these extraordinary circumstances, trying to navigate through this pandemic to deliver several key emergency benefits to all Canadians, all in condensed time frames, clearly stretching our program delivery ability to its limit. Would you agree that at the time the Canada student service grant program was being developed and different options were being explored, the public service was at the point where, in order to deliver programs like the Canada student service grant, they needed some assistance and didn't have the capacity to do it themselves?

Mr. Ian Shugart :

We have indicated that with the particular design of this program, given its scale and the desire for rapidity of beginning the program, the closest vehicle within the public service for delivering it would have been the Canada Service Corps, which was being designed and gradually built. It was very clearly not going to be able to deliver a program on this scale and proactively to do the outreach to Canadian students to get them involved. At that point, therefore, the requirement for a third party was identified, and consideration was given to those who might be able to do it.

Mrs. Salma Zahid :

Would you say that the Government of Canada is normally in the business of delivering programs like the Canada student service grant and that these concierge types of programs help match and train people like our young Canadians? We see the government funding programs like the Canada summer jobs program, but we don't see the government doing the actual matching and hiring, and also the training of the young Canadians. Would that be correct?

Mr. Ian Shugart :

I think in general to this point that has been true, although the form of that may vary. The Canada Job Bank, for example, is a program of long standing which is fundamentally an IT platform for matching jobs with those looking for work. This program had features that were much more hands-on. There is nothing inherently saying that a government department could not deliver that kind of program, but it would be a matter of policy, an administrative policy as to whether that would be the most effective use of public resources.

Any time a government considers outsourcing services from the public sector to private sector providers, it's essentially the same question: Who is best placed to deliver this program in the public interest? In this case, there just was not the time or the existing capability in that tailored way for a public service program to take this on.

Mrs. Salma Zahid :

Thank you. I will pass it on to Mr. Gerretsen.

Mr. Mark Gerretsen :

Thank you. Madam Chair, I really don't have time for a question, so perhaps I'll just make a comment. Mr. Shugart, I want to congratulate you on 40 years of public service. That is absolutely exceptional. In any capacity that I can, I want to offer an apology for the fact that you felt the need to inform this committee at the beginning that anything you said would obviously be the truth. I think that any honourable member would assume that of their top civil servant. I want it to be known that at least from the position that I'm sitting in....

The other people around this table will come and go, but it's the folks who run the operation, the folks who maintain the integrity of the system, such as you, who are the ones who truly keep our democratic system in place for generations to come, so thank you.

(1330) Mr. Ian Shugart :

I'll just say very briefly, if I could, Chair, that I take no offence from the earlier proceeding and I'm keenly aware that sometimes public servants come and go, as well. The first 10 years of my career—I should say, of my misspent youth—were on Parliament Hill, so I wasn't actually a public servant for the first decade of that time.

The Chair :

Thank you very much, Mr. Shugart. We will move to Mr. Gourde for five minutes.

[ Translation ]

Mr. Jacques Gourde (Lévis—Lotbinière, CPC) :

Thank you, Madam Chair. I, too, would like to congratulate you, Mr. Shugart, for 40 years of service. Bravo! Something intrigues me. Around the end of April, when you first met with the Prime Minister , how many scenarios did you present to him for delivering the Canada student service grant?

Mr. Ian Shugart :

If I remember correctly, I wasn't at that meeting, but all the programs for students were discussed. That included the items announced by the Prime Minister, but not the program that received the most attention. At that point, guidelines were established but not determined. There was a lot of detail that needed to be clarified at that point.

Mr. Jacques Gourde :

During the COVID-19 crisis, the government has introduced many initiatives to help Canadians, but where did the idea for the Canada student service grant come from? Was it a political directive or was it a response to advice from government departments to the Prime Minister? Was it the Prime Minister or cabinet that asked for this initiative?

Mr. Ian Shugart :

I'd say it was a combination of things as to the will. In terms of personal goals—

Mr. Jacques Gourde :

Was it political will?

Mr. Ian Shugart :

I understand your question. However, when staff in the ministers' offices and the public servants spoke, they found a problem. There's been an explosion of ideas about what's possible. There has been a kind of back and forth that is typical of program development in any field. At that time, there were discussions between the office of the Minister of Finance , the office of the Prime Minister , ESDC and public servants.

Mr. Jacques Gourde :

Thank you, Mr. Shugart. On the same day the Prime Minister announced the initiative, the media informed us that WE Charity was already ready to apply. Were other organizations able to apply for the program? IS WE Charity the only organization that got the information before the Prime Minister announced the initiative?

Mr. Ian Shugart :

At that time, there was no established program. Of course, WE Charity passed on its ideas, but it wasn't a competition. The offer to manage the program wasn't made to WE Charity. [ English ] At that point there was no program. It was still being developed, but it has been established that WE contributed ideas at that point.

[ Translation ]

Mr. Jacques Gourde :

WE Charity contributed so well to the development of the program that its recommendations and expertise were drawn upon. The program was tailor-made for WE Charity, and therefore, indirectly, only WE Charity was able to deploy the program, since it was tailor-made for it. By the way, this is a unilingual anglophone organization that could not deploy the program in Quebec, where it had no base. You used a third party to set up a program that uses a third party to deploy it in provinces where it has no base. Was it really due diligence to think that WE Charity was the only one that could deliver the program?

The Prime Minister said that senior officials—and, indirectly, you—told him that it was the only organization that could do it, but it was the same organization that developed the program.

(1335) [ English ]

Mr. Ian Shugart :

I will say again, Chair, that the development of this program took place over a period of time. When WE submitted their ideas—and they submitted more than one idea—one proposal they made was not accepted by the government. The government said, “No, not that program. We're not interested in that.” The development of this program, like that of any program, was organic. It was formed on the basis of first determining what features were needed, what problem was being solved. Ideas came from many quarters, and ultimately the program took shape.

As it took shape, and as the features of the program became clear, it also became clear that a third party would be needed to develop the program, but at no point was WE developing a program for the government.

The Chair :

Thank you, Mr. Shugart. We will move to Mr. Gerretsen for five minutes.

Mr. Mark Gerretsen :

Thank you very much, Madam Chair. Mr. Shugart, in your testimony at the finance committee on July 21, you indicated, “I do not see a way that the Prime Minister or the finance minister responsible for public funds could not have had involvement in the policy development and in the approval of finances on this scale.” This committee heard from two academic witnesses yesterday who said that all conflicts have to be considered, regardless of the scale. Can you elaborate on your remarks?

Mr. Ian Shugart :

Yes. I think I indicated to the finance committee my identification of a problem. I do not have a final answer, but I did indicate that one of the main vehicles—it's clearly in the Conflict of Interest Act—for dealing with conflict of interest is disclosure of the conflict so that if there is a tension in objectives, people can see that, and people can judge for themselves whether it is likely that the decision-maker is going about the responsibility of making decisions so as to further his or her own interests.

Mr. Mark Gerretsen :

Let me just build on that for a second. To continue your point, you also said in that meeting, “I must say that, of course, one of the standard means of dealing with conflict of interest...is disclosure.” You then noted that the Prime Minister 's involvement with WE was well documented in the public domain, and therefore was in essence disclosed. Can you comment on that?

Mr. Ian Shugart :

I offer that as at least some insight into why I, for my part, did not identify any looming conflict of interest here. The Prime Minister 's past involvement with the charity was well known. I would say that what the Prime Minister himself said about recusal.... That is the second classic vehicle for dealing with conflict of interest. He has indicated that when it came to the actual decision-making moment, he looks back and regrets that he did not absent himself from that discussion. Every conflict of interest situation is a situation unique to itself.

Yes, there are classic issues to be aware of and avoided, but this was a matter of major public policy involving significant public resources. To a substantial degree, it seemed to me that this did call for the knowledge, at a minimum, of the Prime Minister and the Minister of Finance on that scale.

(1340) Mr. Mark Gerretsen :

Mr. Shugart, would you say that rampant ethics problems exist within the PCO, the Prime Minister's Office and the greater public service at large?

Mr. Ian Shugart :

I certainly would not. We are governed by the Conflict of Interest Act. I very deliberately am not going to pass judgment on questions that are before the Ethics Commissioner. That is his responsibility. But I would indicate that the Conflict of Interest Act is followed every day by public office holders with respect to declarations, the consultation with the Ethics Commissioner with regard to potential conflicts of interest, orders to divest, and screens for conflict that are set up sometimes beyond what the commissioner has called for. The Conflict of Interest Act is very definitely a living reality for our government institutions.

Mr. Mark Gerretsen :

In your opinion, does the act work? Is it fulfilling its objective?

Mr. Ian Shugart :

The act, as every other mechanism of accountability, is the result of successive encounters with problems over decades of governments. In that sense, it is kind of a living document.

The Chair :

Thank you—

Mr. Ian Shugart :

It's ultimately for parliamentarians to say whether it is adequate to the challenges we face.

Mr. Mark Gerretsen: Thank you.

The Chair :

Thank you, Mr. Shugart. Mr. Fortin, you have the floor for two and a half minutes.

[ Translation ]

Mr. Rhéal Fortin :

Thank you, Madam Chair. Mr. Shugart, there is a range of topics I'd like to address with you. If I've understood correctly, you said that the Prime Minister wasn't in a conflict of interest given that his family's involvement with WE Charity was known to the public. Is that what you said?

Mr. Ian Shugart :

I'm not sure it was public at that point. It may have been. Having said that, I imagine his mother's involvement with WE Charity was in the public domain.

Mr. Rhéal Fortin :

However, we agree that he could be in a conflict of interest, even if these facts were known, right?

Mr. Ian Shugart :

I was talking about the involvement, the Prime Minister's own past relationship with the organization. The family aspect wasn't necessarily raised.

Mr. Rhéal Fortin :

All right. Anyway, you aren't here as an expert on ethics. I don't want to bother you with pointed questions. We're going to proceed with facts. Earlier, I asked you a question that I don't think you really answered. I asked you how often the federal government gives a $43.5 million contract to an organization that turns out to be an empty shell, an organization that has no known track record, has been incorporated for a year or two and has no assets, to manage $900 million. Have you ever seen that before?

[ English ]

Mr. Ian Shugart :

No, I cannot say it is common, but I can say that the procedures followed with the organization in order to ensure a solid contribution agreement are common. In fact, they're standard.

(1345) [ Translation ]

Mr. Rhéal Fortin :

Okay. Thank you, but you've already said that. I'm not saying it's not important, Mr. Shugart, but I only have two minutes, and I have one last question for you. You said that you came to the conclusion that the public service couldn't run this program. How did you come that conclusion?

Mr. Ian Shugart :

That was the reasoned opinion of the officials at the department responsible.

Mr. Rhéal Fortin :

Who are these officials?

Mr. Ian Shugart :

As the committee said, they were officials at Employment and Social Development Canada, including the—

Mr. Rhéal Fortin :

Could you give us the name of a person who said that at one point?

Mr. Ian Shugart :

Yes.

[ English ]

The Chair :

Thank you. That's your time.

[ Translation ]

Mr. Ian Shugart :

Ms. Wernick was identified as being responsible, and she presented the facts to the committee.

Mr. Rhéal Fortin :

So it's Ms. Wernick who decided that the public service couldn't run—

[ English ]

The Chair :

Mr. Shugart and Mr. Fortin, that's your time. Thank you. Mr. Angus, you have the floor for two and a half minutes.

Mr. Charlie Angus (Timmins—James Bay, NDP) :

I thank you for your service. Clearly, something went terribly wrong here. The second this program was announced, it fell apart, and it fell apart on the obvious connections between the Prime Minister 's family and the Kielburgers. That question of conflict of interest was the first question. That's before we learned that they were setting up a shell company that had no assets. That's before we learned that they'd fired their board. That's before we learned that the Prime Minister 's family was getting paid when the board was being told they weren't. It was a question of conflict of interest.

I'm not saying that it's your job, but given that your predecessor lost his job in the last ethics scandal, it had to be someone's job to raise this as an obvious red flag. Who in the Prime Minister 's Office raises a red flag of this significance, so that you and everybody involved would not be blindsided when this came out? Whose job was that?

Mr. Ian Shugart :

Well, I think, Chair, that Ms. Telford indicated to the finance committee that she raised the question of wanting to be absolutely certain that this was done in an appropriate way and everything was above board, given the relationship, the history, that the Prime Minister had. That was in this case, and the due diligence proceeded as we have described—

Mr. Charlie Angus :

So that was Ms. Telford's responsibility, because under—

Mr. Ian Shugart :

She indicated that she was the one who raised the question, but I—

Mr. Charlie Angus :

That's a good question. I only have two minutes here. The other question I have—obviously, this thing fell apart—is on this line that only WE had the capacity to deliver a project of close to a billion dollars. Now, we get different numbers—$530 million, $43 million, $912 million—but I'm looking at WE's record with the government: $40,000 for a contract, $24,990, $24,996, $17,050, $13,374. Then there are a few contribution agreements, and the highest is $3 million.

How in anybody's world, looking at WE's record with these penny ante contracts, could you have signed off and said, “I think we can give these guys $912 million and we're not going to have any problems”? That alone, without asking the questions about why they had to set up a shell company and the fact that they were in financial free fall when they came to the government for the money.... They don't have a track record of doing this—

The Chair :

Mr. Angus, that's time. We're going to let that hang. I'm sorry.

Mr. Charlie Angus :

Thank you.

The Chair :

We're moving on to Mr. Kurek. You have five minutes.

Mr. Damien Kurek :

Thank you very much, Madam Chair. Thank you, Mr. Shugart. I appreciate your coming and the forthrightness with which you started your testimony. Is it still reasonable to state that only WE could deliver this program, when it actually couldn't deliver the program in either official language and there were other issues with the program being delivered in different parts of the country?

Mr. Ian Shugart :

As I indicated, Chair, I have not seen anything that would indicate that if the program had proceeded and were in operation today the WE organization would not be able to deliver it. When you examine the contribution agreement, including the nature of having to report against objectives and milestones.... Yes, things fell apart, but not for any demonstrated inability of the organization to deliver the program.

(1350) Mr. Damien Kurek :

Yet the program is not being delivered. Specifically, regarding delivery, was there ever a question asked about whether or not WE could deliver programs effectively in rural Canada, yes or no?

Mr. Ian Shugart :

I believe so, but officials at ESDC would have to provide that detail.

Mr. Damien Kurek :

Sure. Did you listen to the Prime Minister 's testimony before the finance committee?

Mr. Ian Shugart :

I did.

Mr. Damien Kurek :

Was there anything in that testimony that surprised you?

Mr. Ian Shugart :

No.

Mr. Damien Kurek :

On what date did the public service become aware that the Canada Service Corps was not able to run the program?

Mr. Ian Shugart :

I don't know specifically, but as I've indicated, at one point, for the scale of what was being sought—the number of placements, for example, and the need to reach disadvantaged youth and so on—the program had not reached such a level of maturity that it was going to be able to handle that.

Mr. Damien Kurek :

I do find that interesting, because if you have an organization with obviously limited capacity versus a new government program that has limited capacity, it seems like a non-starter, which leads me to my next question. I've read a lot of government briefing notes, but rarely have I seen a briefing note outline such a binary choice as the one that has been described to members of this committee and others. Is it common practice for the public service to provide a binary option to a prime minister or cabinet minister to move forward on a program of this scale, something close to $1 billion?

Mr. Ian Shugart :

Well, there was analysis provided about the ability of other options to deliver, and given the facts of the case, the issue for ministers essentially would have come down to “Do we proceed with this program or not?”

Mr. Damien Kurek :

So, if I'm understanding you correctly, it was either WE or nothing.

Mr. Ian Shugart :

To deliver this program at that stage under those contingencies, yes.

Mr. Damien Kurek :

Okay. Regarding all the third parties that the government reached out to in order to see if they could run the Canada student service grant, would you be able to provide the dates and details of all the contacts between the department and those various organizations?

Mr. Ian Shugart :

I believe that material is included in what we've undertaken to provide. If further information is sought, we would be responsive to that.

Mr. Damien Kurek :

Okay. Thank you. I appreciate that. In your experience, does the Prime Minister usually read the full briefing material he is given before an announcement or a decision is made?

Mr. Ian Shugart :

I'm not with him when he does his reading, but based on his performance and that of all his predecessors, I would say yes.

Mr. Damien Kurek :

Okay. I appreciate that. How often does the government make program announcements when they don't really have a general idea of how, when or even if they will deliver a specific program?

Mr. Ian Shugart :

That, I think, is very much attributable to the circumstances that we faced. The head of a government will, I think—and I can't provide details off the top of my head—often indicate that a government will do something about such-and-such a problem. The government, in this period of the pandemic, I think, frequently declared its intentions in order to send reassurance to Canadians, and then details followed and, as we've seen, were sometimes changed in response to changing circumstances. In that regard, this has been a very unusual period.

The Chair :

Thank you. The floor is Mr. Dong's for five minutes.

Mr. Han Dong (Don Valley North, Lib.) :

Thank you, Chair. Thank you, Mr. Shugart, for being here. I certainly appreciate that. Can you tell us how you and your office or the public service have adapted, over the last several months, to the new norm of running the government during this national crisis caused by the pandemic? I ask this because I've been listening to some of the comments made at this committee, and there's a lot of talk and comparison with how the government should normally function and the processes during normal times. If I may make an observation, the past several months have been nothing like normal times.

When it comes to your office and the government and the public service, how have you been doing in comparison with normal times?

(1355) Mr. Ian Shugart :

I would say there are differences of procedure and of substance. With respect to procedure, I think we have experienced what members of Parliament have experienced. The normal interactions out in the country with groups and communities were vastly curtailed. With respect to how we made decisions and so on, a lot of it was virtually, as the committees are experiencing, and often at all hours of the day and night, given the amount of business and the extent of the impacts of the pandemic. People were pressed. People were tired. Some public servants were doing their work but knowing that it was not being called on.

Other public servants were under pretty unrelenting pressure to deliver. The same is true for ministers. With respect to the substance, I would say that none of us have been happy with the speed at which analysis had to be undertaken. In fact, we conveyed informally, as did the former government during the financial crisis, to the Office of the Auditor General that we anticipated that there would be mistakes. We set out our objectives in advance so that there would be understanding in the Auditor General's office about the constraints that were affecting things.

In this particular case, if we had all the time in the world, I am sure—I'm speculating here—that one of the options to mount this kind of program would be, “How could we accelerate the development of the service corps?” In the circumstances, action was required sooner than that, and that led to what we're now familiar with. I don't present any of that as an excuse for any mistakes that collectively may have been made or may subsequently come to light, but simply to provide background to the nature of the circumstances.

Mr. Han Dong :

Yes, I agree with you; it's fair to say that things weren't operating normally with the government. There's the fact that many public servants have had to work from home, which is very different from the situations they've dealt with in their past experience. At this committee and also at the finance committee—I've watched the testimony—there has been quite a bit of talk about contribution agreements. In your opinion, do you think contribution agreements are unethical? In your opinion or in your experience, is it common for the government to acquire third party services through contribution agreements?

Mr. Ian Shugart :

It is. It is absolutely common. I wouldn't say it's the default, but it is common. We have a vibrant civil society sector, voluntary sector, in this country. The support to women's shelters, the support to food banks, the support to long-term care facilities and other mechanisms during the pandemic were delivered on the part of the public by third parties. Contribution agreements were the vehicle for arranging that support. The contribution agreement is a tested mechanism that has been used over decades by governments—

(1400) The Chair :

Thank you, Mr. Shugart.

Mr. Ian Shugart :

—with, over time, greater precision in order to ensure probity.

The Chair :

Thank you.

Mr. Han Dong :

Thank you, Mr. Shugart.

The Chair :

Mr. Poilievre, the floor is yours for five minutes.

Hon. Pierre Poilievre :

Mr. Shugart, you testified at the finance committee that there is no evidence that anyone in the PMO had been in contact with WE in the lead-up to the announcement of this initiative. The chief of staff to the Prime Minister has since contradicted you and said that at least five members of the PMO were in contact with WE. Can you give us their names?

Mr. Ian Shugart :

I don't have those names with me, Chair, and I wouldn't normally know. I think Ms. Telford made commitments to follow up on that.

Hon. Pierre Poilievre :

That's fair enough. Did anyone in the PMO communicate with anyone in PCO about WE in the period from the beginning of March until the contribution agreement was signed?

Mr. Ian Shugart :

It is possible. I don't know the details of it. Particularly toward the end, the latter stages of the process, it is possible.

Hon. Pierre Poilievre :

Is it possible that they communicated about WE with the PCO prior to the May 8 recommendation that public servants provided the Prime Minister , that WE deliver the program?

Mr. Ian Shugart :

In the form of discussions about the proposal as it was being developed, that is possible. PMO-to-PCO communication, that is possible.

Hon. Pierre Poilievre :

Right, I think it is probable that we had political-to-public service communication before we got public service recommendations back to political.

Mr. Ian Shugart :

Communication is not direction.

Hon. Pierre Poilievre :

Well, that's what we're going to find out. When did you first hear that WE was considered for this program?

Mr. Ian Shugart :

As I indicated to the finance committee, I take the question, Chair, as a personal one. I became aware of this particular file in a fairly light way and toward the latter stages.

Hon. Pierre Poilievre :

Do you have a date, just because we don't need to go—

Mr. Ian Shugart :

I can't confirm if it was at the May 8 briefing.

Hon. Pierre Poilievre :

Were you at that briefing? If I understand your answer earlier, you said you might have been there, but you might not have been, and you think you were, but you—

Mr. Ian Shugart :

Sometimes I am at a briefing. I'm typically at a briefing of the Prime Minister before cabinet, but not always.

Hon. Pierre Poilievre :

Were you at that one?

Mr. Ian Shugart :

I suspect so, but I cannot be certain. I can check, if that's material.

Hon. Pierre Poilievre :

Well, it's just that this is a particularly important cabinet briefing. It's the meeting at which the Prime Minister claims he first learned that WE was going to deliver this program.

Mr. Ian Shugart :

I have examined the record and consulted with colleagues and confirmed that that is the case.

Hon. Pierre Poilievre :

But you don't know for sure if you were at the meeting.

Mr. Ian Shugart :

I suspect that I was there for the briefing on May 8 and May 22, but I don't want, without being certain, to tell the committee definitively. I believe, yes.

Hon. Pierre Poilievre :

You believe you were at the meeting.

Mr. Ian Shugart :

I suspect that I was there. If you want me to confirm with my calendar, then I will do that. I can be at a meeting with the Prime Minister and be called out of the meeting, so there's—

Hon. Pierre Poilievre :

This might have been one of those meetings that I wouldn't want to be at, and if I was there, I wouldn't want to remember it.

Mr. Ian Shugart :

No, it's never that.

Hon. Pierre Poilievre :

Well, I am sure that there are occasions of that nature.

Mr. Ian Shugart :

There are often places where you would rather not be if you had the complete choice, but—

Hon. Pierre Poilievre :

I can't imagine what you're referring to. At the same time, we have this story that the Prime Minister pushed back. You didn't mention that in your original testimony. Minister Chagger didn't mention it. No one else who was there mentioned it. I would think, if a Prime Minister, particularly someone who likes to box, were to put up his dukes and push back, you'd remember it. You probably would have gone home at the end of that day feeling like you had a rotten day, that the boss pushed back against you, but you don't remember having been at that meeting.

Mr. Ian Shugart :

I did say to the finance committee that Ms. Telford raised those questions, so it's well established that the Prime Minister and his chief of staff raised the issue of due diligence. That's been very clear and consistent.

(1405) Hon. Pierre Poilievre :

Right, we just can't get any sense of what due diligence they wanted or received. They knew nothing about the finances, about the board resignations, about the problems that WE.... They couldn't list the other organizations that were consulted, so it doesn't sound like they had any real—

Mr. Ian Shugart :

We've provided the information on the other organizations, and I've been clear that the due diligence did not extend to the financial matters of the foundation.

Hon. Pierre Poilievre :

Right, which would have been necessary to know if they could deliver it—

The Chair :

That's time.

Hon. Pierre Poilievre :

I would conclude, Madam Chair, if I may, by agreeing with Mr. Gerretsen. Mr. Shugart, you are an exceptional public servant. I think it is terrible the way the Prime Minister has thrown you and the public service under the bus, the way that he has implied that you and your organization are to blame. I want you to know—

The Chair :

Mr. Poilievre, that's time.

Hon. Pierre Poilievre :

—that Her Majesty’s official opposition does not believe it for a second.

The Chair :

Thank you. Mr. Shugart, if I may, the original agreement was that you would be here until 2:00; however, due to technical difficulties at the beginning of this meeting, we got started quite late. Would you agree to be here until 2:30 today?

Mr. Ian Shugart :

I'm at the committee's disposal. I'm delighted to be here.

The Chair :

Mr. Shugart, that's an excellent answer. Thank you so much for accommodating us.

Mr. Ian Shugart :

I think we did begin a little before the time. I do have other appointments, but I'll be happy to stay.

The Chair :

I will get you out of here no later than 2:30.

Mr. Mark Gerretsen :

I have a point of order.

The Chair :

Yes, Mr. Gerretsen.

Mr. Mark Gerretsen :

Thank you, Madam Chair. Mr. Poilievre made a comment towards the end there, and you—

The Chair :

This doesn't sound like a point of order.

Mr. Mark Gerretsen :

It actually is, because it has to do with the procedural order of the meeting. It's a point of order. He made a comment. In past comments that have been made at the end—this is not debate; it is to the procedure—you have allowed, as chair, the witness to respond, in this case Mr. Shugart. I'm wondering if, procedurally, you will allow Mr. Shugart to respond to Mr. Poilievre's comment.

The Chair :

Thank you, Mr. Gerretsen.

Mr. Charlie Angus :

Sorry, I have a point of order.

The Chair :

Mr. Angus.

Mr. Charlie Angus :

Madam Chair, I'm not knocking you, but in the last two meetings you have not allowed the witness to respond to my second round. Mr. Gerretsen is new here. He's just shown up, so I don't think he should be assuming how things are done and undermining your work.

The Chair :

Thank you, Mr. Angus.

Mr. Mark Gerretsen :

We are all equals here, Mr. Angus.

The Chair :

We'll be moving forward at this time. Mrs. Shanahan, the floor is yours for five minutes.

Mrs. Brenda Shanahan (Châteauguay—Lacolle, Lib.) :

Thank you, Chair. Actually, while we are discussing so much the finance committee, I wonder, Chair, if we could ask the clerk to ask for written copies of the testimony that has been provided to the finance committee by the witness so that we can avoid undue duplication in the future, and for any other witness who will be appearing on the same issues here at our committee. But while we are talking about the finance committee, Mr.

Shugart, on July 21 you noted, “I must say that, of course, one of the standard means of dealing with conflict of interest...is disclosure.” You went on to note that the Prime Minister 's involvement with WE was well documented in the public domain and therefore was, in essence, disclosed. Can you elaborate for the committee on your thinking in this matter?

Mr. Ian Shugart :

I have no intention of establishing any new doctrine of conflict of interest, of course, but in a situation where decisions are made and the decision-maker has an interest, a private interest, and that is not disclosed, that is an unacceptable situation because nobody can judge the basis upon which the decision has been made. Maybe it is private interests, and maybe it is public interests, but it's invisible.

That's why the Conflict of Interest Act requires public office holders to declare their private interests, including their financial dealings and often what would be considered by many Canadians to be quite intimate details of their affairs and of their family. The purpose is so that the light can be shone on their interests. That does not by itself solve all conflict situations, but it is one of the classic ways of resolving conflict of interest situations so that other parties can judge whether in fact there was a conflict, or, if there was, whether it was resolved in the public interest.

In this case, the Prime Minister was the Minister of Youth in the previous Parliament, and at the same time he had extensive background with an organization that at least in part deals with youth affairs. Therefore, it would not have come as a surprise that he would have had a relationship with WE. Whether that by itself constitutes a conflict of interest is a matter before the commissioner. I think, in his comments, the Prime Minister has indicated that he is willing to submit himself to that finding.

I simply meant that in terms of my own conduct through that period, it did not occur to me that there was a private interest here, because the Prime Minister's interest and involvement and history with WE were anything but private. They were very public. At that time, therefore, I did not say, “Prime Minister, I understand that you have a background with WE, so maybe you shouldn't be part of this conversation”, because it was a very public thing.

(1410) Mrs. Brenda Shanahan :

Thank you. That's very helpful, especially to the motion that we have before us here today. In further testimony, you noted, “I do not see a way that the Prime Minister or the finance minister responsible for public funds could not have had involvement in the policy development and in the approval of finances on this scale.” Now, we heard from academics yesterday who were asked about your remarks, and noted that no matter the scale of the program, conflicts still have to be considered. Can you elaborate on your remarks, particularly on why it was so important to have the first minister's input on such a significant spending approval?

The Chair :

You can give a very brief answer.

Mr. Ian Shugart :

I just think that there are certain matters of public policy that the Prime Minister as the leader of the government is of necessity going to be involved in. I think this is a conundrum that certainly we at PCO will reflect on, going forward.

The Chair :

Thank you. Madam Gaudreau, the floor is yours for two and a half minutes.

[ Translation ]

Ms. Marie-Hélène Gaudreau (Laurentides—Labelle, BQ) :

Good afternoon, Mr. Shugart. We have received a lot of answers. Thank you for giving us more time. I would like to go back to the public aspect and explain to you why this concerns me. For a number of years, I helped not-for-profit organizations, mostly to obtain assistance. I remember clearly how complicated and difficult that could be. I also recall that, without government assistance, some organizations could not provide services. Today, as a new member of Parliament, I have to get used to extremely strict rules.

Under those rules, when one becomes an elected public figure, one is required to provide all the information at one's disposal. The rules are already complex for small organizations, but how could the government have failed in its own responsibilities, which were actually well-known to the general public? Despite the need for urgent action and the huge need for assistance, how is it that, at a minimum, the government did not follow the rules that have to be observed?

Mr. Ian Shugart :

I do not really understand what specifically was not done. In my opinion, with regard to the contribution agreement, the officials did their job and fulfilled their responsibilities to negotiate it. In terms of the Cabinet decisions, it was basically a question of public policy. Students needed support. Factors were considered and an analysis of the design and implementation of the program was done The Cabinet made the decisions and the public service fulfilled its responsibilities.

(1415) Ms. Marie-Hélène Gaudreau :

Thank you.

[ English ]

The Chair :

Mr. Angus, you have the floor for two and a half minutes.

Mr. Charlie Angus :

Thank you. When the pandemic hit, the work of the public service to me was extraordinary with people working around the clock to get this out. I feel this debacle is someplace I don't want to be. There were a lot of failures along the way. I want to know who came up with the parameters for this program.

Mr. Ian Shugart :

It cannot be boiled down to a person. As typically occurs, it is an organic process among political staff in ministers' offices, policy staff and officials, in this case Finance and ESDC with PCO supporting and at one point becoming more involved in the analysis. That is typical. Also, NGOs were involved in identifying possible solutions for students and so on. So it's an amalgam.

Mr. Charlie Angus :

That's interesting because we dealt with so much in our office. We were talking to ministers' offices, and nobody ever suggested we had a problem with volunteerism. We had a serious problem with university students not getting jobs. I'm not saying this as an attack on the PCO. You were given what has already been put together by ESDC. We know that Craig Kielburger had already approached Bardish Chagger . He had approached Minister Ng ; Minister Morneau 's office was involved. They had a first proposal, and they said no, how about a second proposal.

On April 23 the Prime Minister makes an announcement that sounds very similar to the Kielburger proposal. From that point on, it seems they are the only game in town. I really need to know how this happened, that the Kielburger brothers who are in financial free fall can call three ministers' offices, get a proposal in, and have that proposal reflect almost what the Prime Minister 's saying, and then we're moving forward with a $900-million deal. Those parameters that made them the only game in town, to me how did those parameters...? Was it the NGO?

Was it WE that came up with those parameters, working with the advice they got from the ministers: Minister Chagger , Minister Ng ? Is that how this happened?

Mr. Ian Shugart :

I think the record of testimony shows, and the documentary evidence we're providing will show, that there were various contributors to the design of the program.

Mr. Charlie Angus :

The Kielburgers would have been one of them because it was their proposal.

The Chair :

Mr. Angus.

Mr. Ian Shugart :

They did interact, but—

The Chair :

It's time. Sorry. Thank you. I have to give the floor to Mr. Barrett for two and a half minutes. This will be our final round: Conservatives, Liberals, Bloc Québécois and then the NDP. Again, two and a half minutes, Mr. Barrett.

Mr. Michael Barrett :

What was the total value of the contribution agreement?

Mr. Ian Shugart :

I will speak to the program, Chair, because I don't know the exact amounts in the contribution agreement. It was in the order of $500 million that could be extended up to $900 million depending on take-up. That was the program cost. With respect to the actual administrative costs and disbursements for various purposes, the contribution agreement itself will show that, and we're providing you with that.

Mr. Michael Barrett :

It's been said a few times that the process failed, that there are lessons to be learned, but there also have to be accountability measures in place. This was by no means a success. Who bears the responsibility for this program not launching? Who is responsible for this program? It was deemed vital during an important time, worth nearly $1 billion, brought forward to cabinet and received that approval. The contribution agreement was signed, and today we have nothing. Money's been spent; it's not been returned to the taxpayer. Who's responsible for that?

(1420) Mr. Ian Shugart :

As the committee knows, there are procedures for returning the funds, and that is part of any contribution agreement. That is standard and would have been followed in this case. The program did not proceed because WE themselves terminated it in the face of public controversy about the program.

Mr. Michael Barrett :

And that was as a result, in the Prime Minister 's words, of his failure to recuse himself from this process. Those were his words in his testimony. To follow up on Mr. Poilievre's earlier comments, I also don't support the notion that this is the fault of the public service. I think that cabinet made a decision, cabinet accepted the recommendation of the public service, and I think cabinet members are responsible for this decision. We've heard parsing from some members of the committee about whether or not something was in bounds or out of bounds with the Conflict of Interest Act.

Something being disclosed is simply not enough for it being in the public domain. The act requires that there's a disclosure to the commissioner's office. The act requires formal recusal when there's not a screen set up.

The Chair :

Mr. Barrett, that's your time. Thank you. The floor is now Mr. Dong's for two and a half minutes.

Mr. Han Dong :

Thank you, Chair. Mr. Shugart, I still hear a lot of questioning on the testimonies given by senior public servants with regard to the consideration or perhaps decision-making around CSSG. In your opinion, do you have full faith and confidence in the answers provided thus far by your colleagues and in the integrity of their decision-making?

Mr. Ian Shugart :

I absolutely do, Chair. I always—and this applies to myself as well as anyone else—admit the possibility of speaking in error and, as I've indicated to any parliamentary committee, including this one, if there is a contradiction or if there is subsequent information that my testimony is in error, I am more than prepared to clarify and explain. That is, to the very best of my knowledge, the ethics that would be followed by any public servant.

Mr. Han Dong :

How would you rate the performance of the public service of Canada, considering that we're doing very well compared to the rest of the world in dealing with the pandemic as well as rolling out all these programs to support Canadians and the Canadian economy? How would you rate their performance?

Mr. Ian Shugart :

Well, it won't surprise you that I think our public service has performed extremely well because it is a very, very solid institution that fits within the context of our parliamentary institutions, which are the envy of much of the world. If I can say that the public service has performed well during this pandemic, and I do, it's because we stand on the shoulders of giants who have built this institution, and I can only hope that we're today building it for our successors, but I would apply that same principle to the House of Commons and all of our institutions.

Mr. Han Dong :

Thank you, Mr. Shugart.

The Chair :

Thank you. We'll move on to Madame Gaudreau for two and a half minutes.

[ Translation ]

Ms. Marie-Hélène Gaudreau :

I would like to go back to the government commitment, more specifically in terms of trust. In your opinion, what level of trust do Canadians have in the government now?

Mr. Ian Shugart :

I would say that that question is more for the expertise of members of Parliament than for that of public servants. I hope and I believe that, in general, the public trusts our institutions, including the public service. We value evidence, independence and objectivity. Those are the values we espouse. I hope that, if there are deficiencies, we are all responsible for finding solutions.

(1425) Ms. Marie-Hélène Gaudreau :

That is where I want to get to, actually. Trust can quickly be earned, but it can unfortunately also be lost. It is a little difficult to earn it back when errors are made. When there are public aspects, when you want to be transparent—or perhaps to regain that trust—and given the work that you do and your role as clerk and advisor, would it not instead have been valuable to have everything wide open, given the flood of ideas and our need to help Canadians? What do you think about that?

Mr. Ian Shugart :

I have complete confidence in my colleagues. No one can bear those responsibilities without a team or without interactions between the various components of our oversight system. We work with that dependence all the time. That is why we are constantly seeking to improve our systems, whether it is the legislative system or the procedural system. However, safeguarding it is something very precious.

Ms. Marie-Hélène Gaudreau :

How come—

[ English ]

The Chair :

I'm sorry. Your time is up. The floor is Mr. Angus's for two and a half minutes.

Mr. Charlie Angus :

Thank you, Madam Chair. I just want to follow up on my previous question about who came up with the parameters for the program. You said NGOs. What NGOs?

Mr. Ian Shugart :

We are providing a list. I know that Universities Canada was involved in some meetings, the AFN.... There were other groups that were consulted early on with respect to the—

Mr. Charlie Angus :

How early on?

Mr. Ian Shugart :

The record will show that, Chair. I would say as early as April.

Mr. Charlie Angus :

Okay, because the changing moment seems to be when Craig Kielburger calls. Are you aware that they're not registered to lobby? Because they signed a contribution agreement that said they followed the Lobbying Act....

Mr. Ian Shugart :

I'm not aware of those details.

Mr. Charlie Angus :

Okay. Well, that's important, because he calls Minister Morneau 's office. Minister Morneau's office tells Rachel Wernick to talk to Craig Kielburger. He meets with Minister Chagger and he meets also with Minister Ng . Then he writes to Rachel Wernick and says that based on the support they've got, they've got one of two programs and they can deliver both of them or one of them. The one they go with is the one that the Prime Minister agrees to. The second proposal is the proposal, so again, in a question of due diligence—

Mr. Ian Shugart :

I have not seen that communication, Chair.

Mr. Charlie Angus :

Okay. He writes to Rachel Wernick to introduce himself. He says that in the “spirit” of his conversations with Minister Chagger and Minister Ng , “we have proposed two programs” and we're ready to “deliver one or both”. That's his way of getting in. My question, then, is this. We're talking about a $900-million proposal by a group that is not even registered to lobby but has three key departments and ministers onside before it goes to the civil service. He has the proposal all written up. Where was the due diligence to protect the people of Canada?

Mr. Ian Shugart :

Chair, I'm not prepared to support that construction of events. I have not seen that correspondence, but I think the testimony of officials does not support that construction of events.

Mr. Charlie Angus :

How is it possible?

The Chair :

Mr. Angus, that's your time. Thank you. Mr. Shugart, during the questions that were asked today, there were two pieces of information that were brought up and that I believe you will get back to this committee. One is information regarding whether or not the money has been paid back from WE and, two is as to whether or not you were at the briefing meeting on May 8. If you could get back to the committee with that information, it would be much appreciated. Thank you.

(1430) Mr. Ian Shugart :

Happily.

The Chair :

Mr. Shugart, thank you so much for giving us your time today. We hope that you have a good rest of your day. With that, we're suspended.

(1430) (1435) The Chair :

I'll ask everyone to take their seats. We will get started. Thank you. Minister Chagger, welcome.

Hon. Bardish Chagger (Minister of Diversity and Inclusion and Youth) :

Thank you, Chair.

The Chair :

As you're aware, a motion was passed by this committee on July 22:

That, pursuant to Standing Orders 108(3)(h), the Committee review the safeguards which are in place to avoid and prevent conflicts of interest in federal government procurement, contracting, granting, contribution and other expenditure policies;

Minister Chagger, you've been asked to present to this committee and to answer any questions that come from the members today in regard to the motion that I just read aloud. Minister Chagger, in just a moment I will give you 10 minutes for opening remarks, and then the members around the table will have an opportunity to ask you questions. I would ask that we all remain conscious of time. For the first round, each person will be given six minutes to ask their questions. As time approaches its end, I will try to signal to you, but inevitably I may have to cut you off.

I'm not meaning to be rude, but we do have to run an efficient meeting. Minister Chagger, I will give you the floor for 10 minutes. Yes, Mr. Poilievre.

Hon. Pierre Poilievre :

On a point of order, the Conservatives would ask that the minister swear an oath to tell the truth, the whole truth and nothing but the truth. Thank you.

The Chair :

Minister Chagger, are you willing to swear an oath?

Hon. Bardish Chagger :

Yes, and I have one here with me, so I can read that into the record.

The Chair :

Thank you.

[ Translation ]

Hon. Bardish Chagger :

I, Bardish Chagger, do solemnly swear that the testimony I am about to give shall be the truth, the whole truth and nothing but the truth.

[ English ]

The Chair :

Thank you, Minister Chagger. Mr. Angus.

Mr. Charlie Angus :

On a point of order, I don't want to interrupt the minister, but at Finance the rules are we're going with COVID rules so that we're not being rude to each other. I don't want to be seen talking over the minister while she's speaking. Are we going to have the same protocol of shorter questions, shorter answers, and parity on time? Because she's on a screen, it's much harder to maintain that balance. Would you maintain that here?

The Chair :

Mr. Angus, I cede your point. Minister Chagger, I would ask that you try to honour that, that your answers be about the same length of time as the question asked of you. Thank you. With that, we'll allow you to proceed with your comments.

Hon. Bardish Chagger :

Madam Chair, members of the committee, Canadians, I appreciate your inviting me today to appear before you. With me is my senior associate deputy minister, Gina Wilson. I will refer to her as my deputy. We are here, as requested, to provide you with information on the safeguards that have been put in place within the federal government to avoid, mitigate and prevent conflicts of interest. These safeguards apply to the federal government policies on procurement, contracting, grants and contributions, and all other federal spending policies.

I would like to begin by pointing out that the Government of Canada is committed to open and transparent governance. What I mean by that is a government that gives all Canadians broad access to its data and information. Since 2014, the directive on open government has promoted transparency and accountability across all departments. As Minister of Diversity and Inclusion and Youth, I received a very clear mandate letter from the Prime Minister . That letter is available publicly online.

It states that, like all of my cabinet colleagues, I am committed to building a government that is transparent, honest and accountable to Canadians; upholds the highest ethical standards; pays close attention to the management of public funds; and exercises the utmost care and prudence in this regard. These values guide me every day in my work. That's true for me, it's true for my colleagues, and I hope we would agree that it is even true for my departmental officials. All the ministers received these guidelines in our mandate letters, and we are all subject to the same laws.

Whatever our role, there are mechanisms in place to guide us. All members of Parliament must comply with the Conflict of Interest Code for Members of the House of Commons. Ministers and parliamentary secretaries must also abide by the regulations and measures set out in the Conflict of Interest Act. Our staff must also meet the high standard of probity and integrity as set out in the “policies for ministers' offices”.

It's in this context that I'm fulfilling the mandate I have been given and that I am passionate about: namely, to build a more open, diverse and inclusive country where all Canadians have an equal opportunity to succeed. My responsibilities also include policies and programs in support of LGBTQ2 people and youth. It's a broad mandate that involves working with several ministers and departments, particularly Employment and Social Development Canada, Canadian Heritage, Women and Gender Equality Canada, Health Canada, Public Safety Canada and Justice Canada.

Public servants in all these departments are also bound by strict rules of integrity. They must all comply with the public service values and ethics code for the public sector. The public servants at Employment and Social Development Canada who support me through, among other things, the Canada Service Corps program. are governed by this code as are all the staff at Canadian Heritage who support me in the delivery of programs to promote multiculturalism and fight racism. They all receive training in this area.

As well, employees involved in the delivery of transfer payment programs receive additional training to help them identify and deal with potential conflicts of interest. It's also important to note that all Canadian individuals and organizations applying for funding are required to disclose any potential conflicts of interest at the time of application. The distribution of financial support is governed by the Financial Administration Act and the federal government, as a whole, is governed by the oversight and accountability procedures of the Treasury Board Secretariat.

Without naming them all, I would like to single out the policy on financial management, the policy on transfer payments, and the policy on results, evaluation and internal audit. Unlike how the Conservatives are choosing to portray this, the policy on transfer payments, in particular, allows the government to ensure that these payments are managed in a manner that respects sound stewardship and the highest level of integrity, transparency and accountability. Government programs also have terms and conditions approved by the Treasury Board Secretariat.

The anti-racism action plan, for instance, includes terms and conditions to ensure that all organizations have equal access to funding. In this particular case, we are required to publish the program guidelines at least six weeks before the application deadline. There are also guidelines for communicating clearly with funding applicants. Allow me to touch briefly on a few points that I am sure will be of interest to the committee.

(1440) The first is risk management. The Financial Administration Act helps us strike an appropriate balance between the high-risk decisions, which require input from senior management, and those that are more operational. Risk-based decision-making models allow us to assess the risks associated with, among other things, the funding applicant and the activities being considered for funding. They reduce program delivery costs, alleviate the administrative burden and reduce the time it takes to notify recipients. The second is conflict of interest.

I've already touched on the subject, and I'm coming back to it because it's important. Mechanisms are in place in all departments to prevent the risk of bias or conflict of interest. At Canadian Heritage, for example, the decision to approve a grant or contribution is never made by a single individual. In addition to regular internal assessments, they can call on peer reviews or reviews by internal or external committees. Government employees can also work with the office of values and ethics to address any apparent or potential conflict of interest situation.

There are requirements to disclose the involvement of former public servants who are subject to the conflict of interest and post-employment guidelines. The third is internal controls. In addition to government controls such as the policy on government security, several departments have internal control frameworks that outline financial management roles and responsibilities. These frameworks are designed to provide reasonable assurance that public resources are used prudently and that financial management processes are effective and efficient. The fourth is transparency and accountability.

Via the open government portal at Canada.ca, all Canadians can view grants and contributions that have been awarded. Canadians can also consult the various departmental websites for information on those departments' plans, outcomes, costs incurred, contracts awarded, consultations and evaluations undertaken, and a wealth of other information about government and public sector representatives. Mandate letters and transition materials are also freely accessible. As stated in the Clerk of the Privy Council's 26th annual report, the public service of Canada has received “clean, unqualified audits” for two decades.

It tied with the United Kingdom for first place on the 2018 open data barometer and is recognized internationally as one of the most effective public services. I would like to acknowledge and appreciate their work. I would like to conclude with a concrete example that illustrates the rationale behind all these measures and safeguards. Last May, in response to the devastating impact of the COVID-19 pandemic, the Government of Canada adopted a series of measures to support individuals and organizations in many sectors of our economy.

For my part, I insisted that my programs be adapted, whether by streamlining processes or speeding up payments, in order to support organizations that advance multiculturalism, diversity, inclusion and opportunities for youth in Canada. Thanks to the rigorous mechanisms that frame our actions, we've been able to respond quickly and effectively to the pressing needs of Canadians, but we are not out of the woods yet, and we have a lot more work to do. We have adapted to the situation without compromising our rigour, and together we are continuing to build a government that is open and transparent to all Canadians.

Madam Chair, members of the committee, I thank you for your attention, and I look forward to your questions. I've tried to keep my comments brief so that we can answer as many questions as possible.

(1445) The Chair :

Thank you so much, Minister Chagger. We will begin with our six-minute round. Mr. Barrett, the floor is yours to begin.

Mr. Michael Barrett :

Thank you, Minister. We just heard testimony from the Clerk of the Privy Council that you were given authority to sign as a minister for ESDC by order in council. Can you tell us on what date that OIC was issued?

Hon. Bardish Chagger :

I recall the OIC being issued in March to give me jurisdiction within the department, within ESDC as well as Canadian Heritage, which fall under my mandate as Minister of Diversity and Inclusion and Youth.

Mr. Michael Barrett :

Minister, have you, with the exception of the CSSG contribution agreement, used that signing authority as allowed by that OIC for any other program?

Hon. Bardish Chagger :

Madam Chair, through my responsibilities I also have three secretariats within Canadian Heritage. Numerous grants and contributions have been awarded through multiculturalism and others. I can refer to my deputy if you would like any concrete examples.

Mr. Michael Barrett :

No, it's not for those, Minister, thank you, but with respect to ESDC, which was my question. Have you used it with respect to ESDC?

Hon. Bardish Chagger :

I just want to make sure that I do provide all the information. I know that the Canada Service Corps is under my responsibilities, so I just don't know if any have been renewed since I became minister in 2019. I can get back to the committee if you would like.

Mr. Michael Barrett :

I appreciate that. How much money did the Government of Canada pay to the WE organization for the CSSG? We've heard a lot of different numbers, so I'm looking for the final number.

Hon. Bardish Chagger :

We announced $9 billion of programs for students on April 22. When it comes to the Canada student service grant, the contribution agreement was, I believe, $543 million. As documents have been requested, they have been provided to committee members at finance, and we can ensure that they are available.

Mr. Michael Barrett :

Okay. How much, specifically, was flowed, not theorized, but how much actually flowed from the Government of Canada to the WE organization?

Hon. Bardish Chagger :

I can refer to the contribution agreement as to the first cohort, the supplemental cohort and the second cohort. I cannot tell you how much was flowed. What we do know is that the program is no longer running. The money, as the organization has indicated, will be returned to the government.

Mr. Michael Barrett :

Why hasn't the money been returned to this point? It seems odd. It's been quite some time since the program was cancelled, or that they withdrew, following the Prime Minister's announcement that he failed to recuse himself. What's the holdup?

Hon. Bardish Chagger :

I think, Madam Chair, as I've been trying to share in testimony and in any of my communications, we want to ensure that all processes are being followed. I can assure you that the public service is working with the organization to ensure that it is returned. If you would like, I can refer to my deputy to provide and elaborate on this answer.

Mr. Michael Barrett :

No. If you can get back to the committee, though, with that information, it would be very much appreciated. My next question, Minister, is with respect to your communication with any member of the finance minister's staff or in their office or any Finance Canada officials between April 5 and April 22 concerning WE Charity, the Kielburgers, support for students and how the WE organization could provide support for students.

(1450) Hon. Bardish Chagger :

Madam Chair, as I testified at finance committee, within the time frame that the member has requested, I personally did not have those conversations with officials at Finance Canada.

Mr. Michael Barrett :

At the finance committee I had the opportunity to ask you some questions, Minister. There was a disparity between my question to you and your response. I asked if you had spoken with the WE organization about the CSSG, and you responded that no, you hadn't, but you had spoken to them, we later learned, in the time period in question. I believe the date was April 17. In that call, what details did you discuss with this organization? Was it about anything that would later appear in the proposal for the CSSG?

Hon. Bardish Chagger :

Madam Chair, just to make sure it is on the record, on December 10, I appeared at WE Day in Ottawa after I had become Minister of Youth. That was to talk to an auditorium full of youth at the National Arts Centre. The second time I interacted with WE Charity, Craig Kielburger personally, was over the phone on April 17, 2020. I had a phone call with him as well as another member of his team at 11:00 in the morning. That phone call lasted just over 30 minutes. We spoke about an unsolicited program in regard to youth entrepreneurship, social entrepreneurship, and something that had been shared.

As it was not something that I was not considering, I referred it to officials. That phone call on April 17 was not in regard to the Canada student service grant at all. I did not comment on that.

Mr. Michael Barrett :

Okay. I'm tight for time. Thank you, Minister. Your signature is on the—

Mr. Mark Gerretsen :

On a point of order—

The Chair :

Thank you. Mr. Barrett, you have 10 seconds.

Mr. Michael Barrett :

Your signature's on the funding agreement. It's backdated to May 5. Did you tell either of the Kielburgers or anybody at WE that they could start incurring expenses as of May 5?

Hon. Bardish Chagger :

At the recommendation of the public service, it was the only organization that could deliver the program. I did, after a lot of back-and-forth, sign the contribution agreement. No, I did not personally have those conversations with the organization.

The Chair :

Thank you. Mr. Dong and Madam Brière, you have six minutes.

Mr. Han Dong :

Thank you, Chair. Minister, thank you very much for participating. I recall that you said you had spoken to WE Charity after the organization sent you and a few other ministers a proposal on youth social entrepreneurship. We learned that WE Charity had not at the time registered to lobby the government, but you agreed to speak with them. Can you please explain why you agreed to speak to an organization that wasn't registered on the lobbyist registry? How often do you check whether organizations that request to speak to you are registered, and in your opinion, whose job would it be to do that?

Hon. Bardish Chagger :

Madam Chair, the unsolicited proposal regarding youth social entrepreneurship was shared with my office. As the Minister of Youth, I speak with numerous organizations all the time. I keep an open-door policy to ensure that we're having those conversations. As we are a federal government that committed to being more open, more transparent and accessible to Canadians, it's important that we have these conversations. With regard to lobbying, my understanding of the act is that it is for the lobbyist themselves to declare that they have lobbied ministers, officials and so forth, so my understanding is that it would not fall under my responsibilities.

[ Translation ]

Mr. Han Dong :

Mrs. Brière, the floor is yours.

Mrs. Élisabeth Brière :

Thank you, Mr. Dong and Madam Chair. Good afternoon, Madam Minister. Thank you for answering our questions. In your presentation, you mentioned the values that guide you in your work and you repeated the fact that the people working around you must abide by the Conflict of Interest Code for Members of the House of Commons, the Conflict of Interest Act, and so on. Earlier, Mr. Shugart, the Clerk of the Privy Council, told us once more that his duty was to properly and impartially advise ministers, and always to tell the truth. I imagine that you also expect that from your whole team, do you not?

(1455) Hon. Bardish Chagger :

Yes. The members of my team and myself, just like everyone, I believe, are trying to do our work in the middle of a pandemic. We are therefore working at a speed that we have never seen before. We do not have a lot of experience of this type of situation. We are doing the best we can. Our priority is to respond to the needs of Canadians during this pandemic. That remains my priority.

Mrs. Élisabeth Brière :

You may not have an exact figure and I understand that, but can you tell us how many people were involved in making the decisions about the Canada Student Service Grant and how many helped to develop it?

Hon. Bardish Chagger :

As far as the public service is concerned, perhaps my Deputy Minister can also answer that question. All our teams, including mine, worked very hard with a number of people. I feel that all my team worked on it, as did a number of people from the public service. I am sorry that I am not able to give you a specific number.

Mrs. Élisabeth Brière :

I understand. As a government, why were you so determined to implement a program to support young people?

[ English ]

Hon. Bardish Chagger :

I would say that, on April 22, the Prime Minister publicly stated that we were coming out with $9 billion for numerous programs that would be accessible to students. When it comes to the youth portfolio, it's something that's been close to the Prime Minister . Prior to entering office, he was very active with youth organizations as well as youth, and when he was in the third party, he was the critic for youth. When he became Prime Minister, he kept that portfolio as Minister of Youth.

In 2019, he asked me to take on these responsibilities because it was instrumental that we respond to the second-largest demographic in our country. The pandemic has impacted all Canadians, and youth are no exception. That's why we know that students have costs in the fall and we will ensure that they also have the supportive mechanisms. This pandemic has disproportionately impacted certain communities, and that's why my portfolio and my responsibilities are so instrumental, because we need to ensure that nobody is left behind.

Every Canadian deserves to be supported, and we will be there to support and provide programs to all Canadians.

[ Translation ]

Mrs. Élisabeth Brière :

In that context, what are the comments about the fact that the program has not been launched?

[ English ]

Hon. Bardish Chagger :

Madam Chair, when I speak English the translation comes through as French in my headset, so I missed the member's question. If she could repeat it, that would be great. I will keep my answer short.

[ Translation ]

Mrs. Élisabeth Brière :

What are the comments about the fact that the program has not actually been launched?

[ English ]

Hon. Bardish Chagger :

We've received numerous emails and comments. We've seen the report in the media as well. The Canada student service grant was an additional program. We have put out a series of programs to help students during this pandemic, recognizing that they also need supports. We also know that students are part of the solution. Right now we know that Canadians are hurting; communities are hurting. We promote service. I myself know that growing up, I would not have been able to have the experience I had without volunteer opportunities. Volunteering, serving our communities is another way—

The Chair :

Minister Chagger, thank you.

Hon. Bardish Chagger :

—to develop and strengthen skills. It's an important aspect of the programs we're delivering. It's really unfortunate and regrettable that it is not.

(1500) The Chair :

Thank you. We're moving to Mr. Fortin for six minutes.

[ Translation ]

Mr. Rhéal Fortin :

Good afternoon, Madam Minister. Earlier, you told my Conservative colleague that you do not know how much money has been sent to WE Charity and how much money the organization has returned. Did I understand correctly? You have no idea about the amount of money that has passed between the government and WE Charity since this spring. Is that correct?

[ English ]

Hon. Bardish Chagger :

Madam Chair, it's not that we don't know how much money. We can share the details on the money that has been released: $30 million has been released to the organization through the contribution agreement. I was not aware of how much money has been returned. I have offered to provide that information to the committee.

[ Translation ]

Mr. Rhéal Fortin :

Thank you, Madam Minister. That is kind of you and I am grateful. If I understand correctly, you will be able to send us the information about the exact amounts that have been sent and the amounts that have been returned. Is that correct?

[ English ]

Hon. Bardish Chagger :

Yes. I will make sure you have that information.

[ Translation ]

Mr. Rhéal Fortin :

Thank you very much.

[ English ]

Hon. Bardish Chagger :

We know that the first cohort had an amount attributed to it through the contribution agreement, which members have received.

[ Translation ]

Mr. Rhéal Fortin :

So you will send us the figures.

[ English ]

Hon. Bardish Chagger :

Then there was the supplemental cohort—

Mr. Rhéal Fortin: I have a time problem, Minister.

Hon. Bardish Chagger: That's exactly why I'm responding in English. I understand you get extra time for translation.

[ Translation ]

Mr. Rhéal Fortin :

Thank you. When answering a question earlier, you replied that you have had speaking engagements for WE Charity without checking whether it was on the Registry of Lobbyists. You said that, in your opinion, it was not your responsibility to find out that information. Did you actually say that it is not your responsibility to check whether WE Charity was in the registry?

[ English ]

Hon. Bardish Chagger :

Madam Chair, I responded that I understand it is the responsibility of the lobbyists to report their lobbying activities.

[ Translation ]

Mr. Rhéal Fortin :

So you did not think that it was your responsibility to verify that information. Is that correct?

[ English ]

Hon. Bardish Chagger :

Madam Chair, I have responsibilities to my stakeholders. I have responsibilities to the people who have elected me to represent them. I take my responsibilities very seriously.

[ Translation ]

Mr. Rhéal Fortin :

You have a lot of responsibilities, but do they not include responsibility with regard to the registry? Did you ask the Commissioner of Lobbying whether, as a minister, you had the responsibility to make sure that the people coming to see you are properly registered in the Registry of Lobbyists? Did you verify that with the Conflict of Interest and Ethics Commissioner?

[ English ]

Hon. Bardish Chagger :

Any time I need information from the Ethics Commissioner, I make sure to write to the Ethics Commissioner or have my team do so, so that we can receive that information. Similarly, in ensuring understanding of what I am able to share today and so forth, I made sure that I had that information. I take my responsibilities very seriously.

[ Translation ]

Mr. Rhéal Fortin :

I will repeat my question: did you check with the Conflict of Interest and Ethics Commissioner or the Commissioner of Lobbying whether you had a responsibility to check the registry? Did you ask for an opinion?

[ English ]

Hon. Bardish Chagger :

In this situation, I did not contact either of them on whether I could talk to a youth organization or not. As Minister of Youth I keep an open-door policy. I speak to numerous organizations. I think it's important that we be available and accessible to organizations so that we can hear not only their concerns but also their solutions. I will be accessible to Canadians.

[ Translation ]

Mr. Rhéal Fortin :

Okay, thank you, Minister. I am sorry, I don't want to rush you, but I just have a few minutes. You are nice, but time is not on my side. Madam Minister, to your knowledge, what checking did you do into the financial viability of the organization to which you were supposed to entrust this mandate, that being WE Charity?

Hon. Bardish Chagger :

Madam Chair, I will ask my Deputy Minister.

Mr. Rhéal Fortin :

Do you know, Madam Minister? Madam Chair, I would prefer an answer from the minister. We will be able to hear from your deputy afterwards, Madam Minister. What checks did you do personally?

Hon. Bardish Chagger :

Madam Chair, I know that the member does not have a lot of time to ask questions. I want him to get the information that assures him that all the work was done. It is important to give the member a few moments in order to provide that information and to make sure that he has it.

(1505) Mr. Rhéal Fortin :

Do not waste time telling me all that, Madam Minister, I know it already. With all respect, I am aware of that. I want to know whether you personally were aware of any vetting of the We Charity Foundation. Yes or no.

[ English ]

Hon. Bardish Chagger :

Madam Chair, I can tell you that, as was shared at the finance committee, numerous conversations took place. Yes, concerns were raised to ensure that due diligence was done. I know that the public service, the professional and non-partisan public service, works really hard. I have confidence that they did that work. That's why—

[ Translation ]

Mr. Rhéal Fortin :

That was not my question. We are not in the House.

[ English ]

Hon. Bardish Chagger :

—the deputy can actually provide concrete examples of the information that the member is looking for. I think it's important that the deputy be able to provide those details, if the member would like.

[ Translation ]

Mr. Rhéal Fortin :

Madam Chair, I just have a few minutes. Can you ask the minister to stop? My speaking time is running out.

[ English ]

The Chair :

It's your question.

[ Translation ]

Mr. Rhéal Fortin :

Excuse me, Madam Minister. We have a delay in the

interpretation and we have the delay you are causing, Madam Minister, by explaining to us all kinds of things that are not relevant to the issue. I d