> > We are also joined at the table this afternoon by Mr. Rob Walsh, the
> Law Clerk of the House of Commons, and his assistant, Mr. Greg Tardi.
> > We'll start off, as we normally do on this issue, with a few pearls
> of wisdom from Mr. Walsh.
> > Mr. Rob Walsh (Law Clerk and Parliamentary Counsel, House of
> Commons): Thank you, Mr. Chairman.
> > Mr. Chairman, most people in this room have heard this more often
> than they want to hear it, but to those who haven't, I'll reiterate again.
> It is the committee's interest, obviously, to look into the matter that's
> on the agenda for today's meeting, but, sensitive, as well, to the fact
> that there may be investigations going on by the RCMP, and matters related
> to the same matters under consideration today. For that reason, the
> committee is meeting in camera, so as to be sure that testimony obtained
> today is not to put to other purposes.
> > I don't know that I need to reiterate beyond that to say to you, Mr.
> Guité, on behalf of the committee, and your counsel, that you enjoy the
> protections of the law of Parliament, which assure you that your testimony
> here today is not available for other purposes, but only for the benefit
> of this committee.
> > Mr. Williams, as Chair, will explain to you what the committee has
> decided relative to the in camera status of this meeting.
> > The Chair: Thank you, Mr. Walsh.
> > As I mentioned to you, Mr. Guité, before the meeting started, that
> the committee has moved, and adopted a motion, that the evidence given
> today will be held in confidence for a period of three years, minimum. If
> there are no charges laid by the RCMP against anyone regarding this entire
> investigation by the RCMP, and if charges are laid, then the testimony
> will be held in confidence until all court proceedings, including appeals,
> if any, are fully and completely exhausted.
> > We do intend that the testimony become public at some point in time,
> but certainly not in the near future.
> > We do not have any opening statements. The Auditor General does not
> have an opening statement. You don't have an opening statement, do you,
> Mr. Guité? You do. Okay. Therefore, I'll you to present your opening
> statement.
> > Mr. Guité.
> > Mr. Charles Guité (Ancien Directeur général, Services de
> coordination de communications, À titre individuel): > My only comment is
> as stated by Mr. Walsh on the minutes of June 4, on page 8, that as a
> former public servant, I have to respect oaths of confidentiality. I quote
> a comment made in those minutes, ``A former public servant, I'm not sure
> if it's the case, I wouldn't be surprised if it is the case, that they
> have a> continuing obligation to respect confidentiality in matters they
> have learned while in the public service.''
> > Based on that, Mr. Chairman, I will decline today to answer any
> question that relate to discussions that I may have had with ministers. It
> will require ministerial authorization for me to disclose any discussions
> I've had with ministers prior to answer any questions that will deal with
> discussions with ministers.
> > Thank you.
> > The Chair: Thank you very much, Mr. Guité. We respect that--is it a
> right, or a privilege--whichever it may be. If you feel that any questions
> invoke that privilege, you would just invoke that privilege, and we'll
> just move from that point forward. If you feel that, with the oath that
> you have taken, as a public servant, that you cannot break the confidence
> with discussions with the ministers, feel free to invoke it, and I will
> support your right to be protected by that oath.
> > Mr. Mayfield, eight minutes please.
> > * (1605)
> > The Chair: Mr. Mayfield.
> > Mr. Philip Mayfield (Cariboo-Chilcotin, Canadian Alliance): Thank
> you, Mr. Guité.
> > I was interested in your opening statement that you will not be
> mentioning anything that transpired between you, and the minister. Is that
> an obligation of yours that you cannot do that?
> > Mr. Charles Guité: No, it's to respect confidentiality that I had as
> a public servant.
> > Mr. Philip Mayfield: I see. Does that put you an obligation not to
> discuss that?
> > Mr. Charles Guité: Yes, it does.
> > Mr. Philip Mayfield: I see. So if we wanted that information, where
> would we get it? Would we have to go to the minister or the former
> minister to get that information?
> > Mr. Charles Guité: No, as long as I get authorization from the
> minister to discuss those issues, then, I will do so.
> > Mr. Philip Mayfield: So we could perhaps ask the questions and then
> you have you get authorization and invite you to come back again. Is that
> the way it would work?
> > Mr. Charles Guité: That could be a solution, yes.
> > Mr. Philip Mayfield: Perhaps in writing. Is that the way to do it?
> > Mr. Charles Guité: That's fine.
> > Mr. Philip Mayfield: Okay.
> > It strikes me, Mr. Chairman, with this kind of a difficulty, we may
> need, as a committee, to later discuss the need to have a minister here to
> answer these questions and these issues--or former minister, as the case
> may be. I'm asking the committee to consider that for that time being. But
> in the meantime--
> > The Chair: In response to that, Mr. Mayfield, I think we have to
> wait and see how much is invoked by Mr. Guité.
> > Mr. Philip Mayfield: I agree, I agree.
> > The Chair: We'll make that decision perhaps later on in the meeting.
> > Mr. Philip Mayfield: I agree with that entirely.
> > The Chair: Okay.
> > Mr. Philip Mayfield: Now, Mr. Guité, we're discussing today, I
> believe, only three contracts that have been looked at by the Auditor
> General and her people. One of the interesting questions she raises is
> that in the first contract there was a ceiling or limitation of
> expenditure of $250,000, and then later that was amended and it was
> doubled.
> > Can you explain why that amount was doubled, please?
> > Mr. Charles Guité: Yes, I can. When I first issued the first
> contract and I asked for a specific amount of work done, Groupaction in
> Montreal started the work. Halfway through the process I had some
> discussions with them and they indicated they could not complete the work
> on the amount. After some lengthy discussions with them, it was decided it
> would probably take double the amount. Therefore, I instructed, if I
> remember right, one of my staff to increase the contract by $250,000.
> > Mr. Philip Mayfield: Now, would that have been a decision that you
> made personally? Or would that be a decision that you made after
> discussing it with other employees who reported to you, or perhaps to
> members of the department whom you reported to?>
> > Mr. Charles Guité: No, there was discussion with some of my staff
> and myself and I made the decision.
> > Mr. Philip Mayfield: And you made the decision, okay.
> > Now, in paragraph 29 of the Auditor General's report, it's mentioned
> there that > "> there was verbal advice, discussion and strategic
> information provided to him...> "> --and I presume that > "> him> "> is
> you--> "> ...about events that the government could sponsor.
> > Could you describe the nature of that advice, please? The Auditor
> General has said that she can find no record of that advice in the files
> that her people were looking at.
> > * (1610)
> > Mr. Charles Guité: Well, let me make the following comment--and
> contrary to the Auditor General's comment, every rule in the book was not
> broken. During the referendum of 1995 my office was requested by the
> Federal-Provincial Relations Office to hold a competition--I have to be
> careful here the term I use--and to follow a bit of the guidelines that
> exist in the rules, but I may have to, for a better term, bend them a
> little bit, because, as you all can understand, we were basically at war
> trying to save the country. We, and FPRO, invited approximately 10 firms,
> which is documented, there's a scope of work, to present to us, as a
> committee, what they could do to help us win the referendum in
> Quebec--which they did. Based on that, we retained five firms. Those five
> firms were issued contracts and, in fact, helped us to win the referendum.
> > Subsequent to the referendum--obviously, as we all know in this
> room, it was a close call--I was asked by a committee, if I remember
> right, of people from FPRO, people from PCO, how we would be more visible
> in Quebec--the Government of Canada would be visible in Quebec and the
> rest of Canada, but, obviously, more in the Province of Quebec. Based on
> the results that Groupaction had provided to us during the referendum, I
> decided that was the best firm to be able to advise me on where we should
> be present, at what event, what visibility we should have. Obviously, we
> were not going to broadcast our plan and our strategy through a public
> tendering process and, in fact, having some information on file that could
> be available to the opposition.
> > Mr. Philip Mayfield: Now, because this was such a vital issue at the
> time, and I believe the Prime Minister's office, and, indeed, the Prime
> Minister was concerned about this and would very likely have wanted to
> know the progress of the actions that were being taken, who was involved,
> the results that were being derived of this, no one is more responsible
> for what happened at that time, I guess, and recovering from it than the
> Prime Minister, himself, and, of course, he would depend upon his
> government to act using Government of Canada policies. I'm wondering who
> was the liaison between you and the minister's office and the Prime
> Minister's Office to keep track of this whole program as it was going on.
> Can you tell us that, please, sir?
> > Mr. Charles Guité: No, I'll just make the following statement and
> I'll quote Mr. Greg Thompson at a previous meeting of June 6.
> > Mr. Philip Mayfield: Of which year?
> > Mr. Charles Guité: A couple of weeks ago--2002--and I quote, > ">
> Would it be fair to say that the Sponsorship Program was set up for the
> greatest political reasons, in all sense of fairness? In the very
> beginning it was obviously set up for political reasons, for the greater
> good of the country> "> .
> > Mr. Chairman, I could not have articulated it better. But my role
> was to deliver a program based on existing government policies--
> > Mr. Philip Mayfield: My question is: who is involved with you in
> making the decisions about perhaps slightly bending the rules, about
> coordinating it, which to accept and which to reject?
> > Mr. Charles Guité: That was my decision.
> > Mr. Philip Mayfield: > You had no consultation with your deputy
> minister, with your minister, with other officials from the PMO?
> > Mr. Charles Guité: Based on my initial comment, I decline to go any
> further on that question.
> > Mr. Philip Mayfield: Mr. Chairman, I don't know what to do at this
> point. I'm not getting an answer to the question that I want. I believe
> there needs to be an answer. I think we need to know who was involved.
> I've not asked for conversations between the minister and Mr. Guité, I've
> simply asked who's involved. What would you suggest I do at this time?
> > The Chair: My recommendation, Mr. Mayfield, is that at 6.30 p.m., as
> you know, we are conducting a meeting on future business and that it be
> discussed at that point in time by--
> > The Clerk: Six o'clock.
> > The Chair: No, it was 6.30 p.m. This will go till six...anyway,
> after this meeting we'll be having another meeting to discuss future
> business and that we discuss the issue at that time.
> > Do you fell satisfied with that as a response?
> > * (1615)
> > Mr. Philip Mayfield: But who, you see, who do we discuss this with?
> > The Chair: Okay, let me ask the law clerk a question.
> > Mr. Walsh, when Mr. Guité invokes this right to remain silent, does
> this cover any and all conversations or only those--
> > Mr. Philip Mayfield: This is not conversations, this is who.
> > The Chair: I know, but does it cover his discussions with anybody or
> only with ministers and advice he gives to ministers?
> > Mr. Rob Walsh: I'm not sure what the genesis of Mr. Guité's
> obligation for confidentiality is, whether it's found in a statute, a
> regulation or a ministerial document. But I suspect, going to the basic
> principles of what in common law is called master/servant, the former
> employer has an ongoing duty of confidentiality toward the former employer
> on matters pertaining to the business of the employer the former employee
> learned about while in the course of his employment. So there may be some
> nuances to be given to that relative to a ministerial department.
> Basically, Mr. Guité, in my view, as he has done, is obliged towards his
> minister to acknowledge his duty of confidentiality, but I would not have
> thought that within that was the very question of whether there were
> consultations. I would have thought that it would have applied to what
> those consultations were. However, that's just my judgment. I defer to Mr.
> Guité, who may be more closely familiar with the terms of his obligation
> and he may have a different interpretation, but I would have thought
> whether there were consultations would not be within it, what those
> consultations were might well be within it.
> > The Chair: You may confer with your lawyer if you want to confer
> with your lawyer on this question because Mr. Walsh has pointed out a
> clear difference between you can confirm the conversations took place, but
> the content are protected between yourself and the minister. It would seem
> whether or not the conversation did actually take place would be a
> question that could be answered.
> > Mr. Charles Guité: Yes, I think if Mr. Mayfield would rephrase his
> question so that it does not include reference to the ministers or the
> minister, then I can answer the question
> > Mr. Philip Mayfield: I'm not asking that Mr. Guité. You see, this
> morning Mr. Tremblay said there was a liaison process set up. What I am
> asking you is not what was said--
> > Mr. Mac Harb (Ottawa Centre, Lib.): A point or order, Mr. Chair.
> > Mr. Philip Mayfield: --but who was involved in that process.
> > Mr. Mac Harb: A point of order, Mr. Chair. This is highly out of
> line.
> > The Chair: We know that. This is--
> > Mr. Mac Harb: We sought, we wanted the in camera. We had two
> separate meetings, one in the morning, one in the afternoon, where the two
> witnesses would not hear about each other's testimony-->
> > The Chair: Okay.
> > Mr. Mac Harb: --and basically that's what we're doing now.
> > The Chair: Mr. Mayfield's line of questioning, we're dealing with
> maladministration, and he is trying to find out what kind of process was
> in place. He is in command of a certain amount of information, which Mr.
> Guité may have also, and Mr. Mayfield only wants to know the chain of
> command.
> > Am I correct, Mr. Mayfield?
> > Mr. Philip Mayfield: I want to know why Mr. Tremblay was not able to
> tell us.
> > The Chair: Okay, well, I think, perhaps--
> > Mr. Philip Mayfield: --and I only refer to this because--
> > The Chair: Yes. Don't refer to Mr. Tremblay.
> > Mr. Philip Mayfield: --there was information that Mr. Guité has that
> was not provided earlier. I simply want to know who was the liaison? Who
> was that person?
> > Mr. Charles Guité: What I can clearly tell you is that I met on a
> regular basis with the minister.
> > Mr. Philip Mayfield: But there was a liaison beyond that, was there
> not?
> > Mr. Charles Guité: --and I met regularly with my deputy minister.
> Okay? What I discussed with the minister I'm not about to say it in this
> meeting.
> > Mr. Philip Mayfield: I haven't asked you that, sir.
> > The Chair: Okay.
> > Ms. Phinney, do you have a question?
> > Ms. Beth Phinney (Hamilton Mountain, Lib.): Yes, I'd like to clarify
> with Mr. Walsh whether, when we go into a meeting and it's in camera, I
> presume that information is only for the people at that meeting. We have a
> witness here who was not at that meeting. I feel, if I've understood Mr.
> Walsh correctly, the information from this morning's meeting should not go
> to anybody else except those who are at this morning's meeting. Could you
> clarify that, please?
> > Mr. Rob Walsh: The ambit of in camera depends on what the committee
> wants it to have. It could well be the case that in-camera meetings, as
> you've indicated, persons who are not in this morning's meeting should not
> be have disclosed to them testimony that was given at that meeting. At the
> other hand, it could be the option of the committee to have this witness
> and his counsel covered by the same in-camera obligations with respect to
> what they learned at this meeting, including testimony from the morning
> meeting. That's an option for the committee.
> > * (1620)
> > The Chair: I would think it advisable for all the members they stay
> away from specific reference to any information they gleaned or obtained
> from this morning's meeting so that we do not have to mention Mr.
> Tremblay's name. You may be privy to some information, you may have read
> it in a newspaper, you may have heard it from the minister in the House,
> there's all kinds of information available in this issue, but I think it
> would be best to stay away from saying, > "> Mr. Tremblay said this
> morning...> "> .
> > Mr. Walsh.
> > Mr. Rob Walsh: I would just like to add that I think it goes without
> saying that this witness and his counsel are here today attending at an
> in-camera session and such information they may obtain in the course of
> discussions at this meeting about testimony this morning is, of course,
> governed by the same in-camera restriction on any disclosure outside this
> room. I just thought I should reiterate, although you've counselled
> members to avoid citing evidence heard this morning, should that happen it
> is governed by the same in-camera restraint on everybody in the room as if
> it were original testimony at this meeting.
> > The Chair: Okay.
> > I'll ask Mr. Guité if there's anything further to add to Mr.
> Mayfield's question because your time has expired, Mr. Mayfield.
> > So do you have anything--
> > Mr. Philip Mayfield: Not entirely, that's at my disposal.
> > The Chair: Do you have anything further to add in response to Mr.
> Mayfield's question?
> > Mr. Charles Guité: No.
> > The Chair:> No.
> >
> > You have the floor for eight minutes, Mr. Lebel.
> >
> > Mr. Ghislain Lebel (Chambly): Mr. Guité, you stated that during the
> referendum - which puts us in 1995 - you were asked by the
> Federal-Provincial Relations Office to retain five firms to help with the
> referendum. That> '> s what you stated. However, you subsequently said
> that you were satisfied with their work, that you decided to continue
> contracting with these firms to enhance the government> '> s profile and
> that these contracts were not put out to tender. Is that in fact what you>
> '> ve just stated?
> > Mr. Charles Guité: That's correct.
> > Mr. Ghislain Lebel: Therefore, contracts were not put out to tender
> after 1995. Correct?
> >
> > Mr. Charles Guité: No.
> > The Chair: Did you respond to that question?
> > Mr. Charles Guité: Yes, I did.
> > The Chair: Okay, my apologies.
> > Mr. Ghislain Lebel: Do you know Jean Brault and Claude Lemay?
> >
> > Mr. Charles Guité: Yes.
> >
> > Mr. Ghislain Lebel: Did these two men work on the 1995 referendum
> campaign?
> >
> > Mr. Charles Guité: Claude Lemay?
> >
> > Mr. Ghislain Lebel: From Groupe Everest.
> >
> > Mr. Charles Guité: You mean Claude Boulay.
> >
> > Mr. Ghislain Lebel: I> '> m sorry, yes, Claude Boulay.
> >
> > Mr. Charles Guité: Yes.
> >
> > Mr. Ghislain Lebel: And that is when you first became acquainted
> with them?
> > Mr. Charles Guité: I didn't get to know them personally, but most of
> their staff...not most, but a lot of their staff were working on the
> campaign.
> > Mr. Ghislain Lebel: Later, when you were in charge of the
> Sponsorship Program, did you have occasion to meet with Jean Brault and
> Claude Boulay somewhere other than at your offices here in Ottawa?
> > Mr. Charles Guité: On a regular basis I met them either in their
> office in Montreal or in my office in Ottawa to discuss strategy. That's
> why, at the end of the day, we were so successful.
> >
> > Mr. Ghislain Lebel: I don> '> t doubt that for a moment! Did you
> also have occasion to meet with them somewhere other than at your office?
> > Mr. Charles Guité: No. I may have lunch with them, things like that.
> > Mr. Ghislain Lebel: Is it possible that you met with them at Jean
> Brault> '> s chalet in the Eastern Townships?
> > Mr. Charles Guité: No, no.
> > Mr. Mac Harb: A point of order, Mr. Chair.
> > The Chair: A point of order.
> > Mr. Mac Harb: I think here we are moving away from the proper line
> of questioning. The chalet visiting, this is completely out of line, I
> would suggest.
> > The Chair: I think your point of order is out of order, Mr. Harb,
> because--
> > Mr. Mac Harb: I don't think so. I would ask our counsel whether or
> not this is a proper question.
> > The Chair: It's the clerk we normally refer to, not the law clerk.
> He is entitled to ask the questions. We're trying to find out the
> administration of the public service in these three particular contracts,
> and if he were meeting the people here, there or somewhere else, I think
> he's entitled to ask the question.
> > Mr. Mac Harb: He was starting to abuse the witness.
> > The Chair: Okay, I'm paying attention.
> > Continue on, please, monsieur Lebel.
> > Mr. Ghislain Lebel: Therefore, you maintain that you never met with Jean
> Brault and Claude Boulay outside your office -- for instance, at a chalet
> in the Eastern Townships?
> > Mr. Charles Guité: I have no comments to make. I'm here to talk
> about the three contracts with Groupaction.
> > * (1625)
> > Mr. Ghislain Lebel: I would assume that you met with these men to
> discuss the contracts. Correct?
> > Mr. Charles Guité: I met them at my office or their office and, on
> some occasions, had lunch with them.
> > Mr. Ghislain Lebel: And where did these meetings take place?
> > Mr. Charles Guité: In Montreal or in Ottawa.
> > Mr. Ghislain Lebel: The breakfast meetings as well?
> > Mr. Charles Guité: In Ottawa or in Montreal.
> > Mr. Ghislain Lebel: I see. Were you present at meetings between Jean
> Brault, Claude Boulay and former Minister Alfonso Gagliano?>
> >
> > Mr. Charles Guité: No.
> >
> > Mr. Ghislain Lebel: Never?
> >
> > Mr. Charles Guité: No.
> >
> > Mr. Ghislain Lebel: Fine then. I> '> d like to talk about the famous
> report that has gone missing. The Auditor General refers to a report that
> was never produced and that supposedly cost the government $575,000. The
> report had two components: a qualitative study and a quantitative study.
> Do you know anything about this report?
> > Mr. Charles Guité: Are you talking about the first report, the
> second report or the third report?
> > Mr. Ghislain Lebel: I> '> m talking about the second and third
> reports that consisted of qualitative and quantitative studies. As some
> point, you deviated from the qualitative aspect of the work that had been
> commissioned. Correct?
> >
> > Mr. Charles Guité: It depends where you> '> re going with that
> question.
> >
> > Mr. Ghislain Lebel: I want to know if you bent the rules somewhat in
> the case of the study that was commissioned ?
> > Mr. Charles Guité: Let me make the following statement. There were
> three reports produced by Groupaction. I have seen the three reports. I
> have touched them. Other people have seen them and have touched them. When
> I left the public service in August 1999, the reports were there. They're
> not there today. I can't comment any further than that. But Groupaction
> prepared the reports, as requested. As the Auditor General people may have
> commented, we may have deviated from the scope of work, but, again, for a
> better term, we were at war and we were not going to give our plan of
> attack. I requested those firms to deviate a bit from the scope of work,
> but, at the end of the day, look at the current situation.
> > Mr. Ghislain Lebel: We know what the outcome was, but you> ...>
> since you say you have actually touched these reports, you must have
> noticed that there was no qualitative analysis done, because you had in
> fact asked Jean Brault not to do one.
> > Mr. Charles Guité: No, that's exactly what I requested and I asked
> them to provide me verbal advice on certain strategies and certain events,
> that we would know who was there, who would be there, how present would be
> the Government of Quebec versus the Government of Canada. It was valid
> information and very valuable in making sure we were very visible. When I
> look at today's results in la belle province, I'm very proud of what we
> did. If I had to do it again, I'd do it better, with the experience I have
> gained.
> > Mr. Ghislain Lebel: Does the name > "> Johanne Archambault> "> ring
> any bells?
> >
> > Mr. Charles Guité: No.
> >
> > Mr. Ghislain Lebel: Yet, the reports, including those that you
> touched, show that you signed off on invoices submitted by Groupaction on
> behalf of Jean Brault and Johanne Archambault, who charged $252 and $202
> an hour respectively for their services . You signed off on these invoices
> and payment was made. That doesn> '> t ring any bells?
> >
> > Mr. Charles Guité: No.
> >
> > Mr. Ghislain Lebel: Do you know Jean Brault> '> s wife?
> >
> > Mr. Charles Guité: Yes.
> >
> > Mr. Ghislain Lebel: What is her name?
> >
> > Mr. Charles Guité: Her given name is Johanne, but I don> '> t know
> her surname.
> >
> > Mr. Ghislain Lebel: And what if I told you it was Archambault? When
> you went to Jean Brault> '> s Groupaction offices, did you meet his wife,
> Mrs. Brault?
> > Mr. Charles Guité: No, never at his office.
> > Mr. Ghislain Lebel: You never saw her at this firm> '> s offices?
> Yet, during a three-month period in 1999, from June 1 to September 30, she
> alone billed the government for somewhere between $110,000 and $115,000
> for services rendered.
> > Mr. Charles Guité: No, the invoices I received from Groupaction were
> invoices from Groupaction and not individuals, that I can recall.
> > * (1630)
> > Mr. Charles Guité: No, I can't comment. We're talking of contracts
> that go back three or four years.
> > Mr. Ghislain Lebel: But these details can be found in the
> contracts.>
> > The Chair: Merci beaucoup.
> > Mr. Bryden, please, eight minutes.
> > Mr. John Bryden (Ancaster-Dundas-Flamborough-Aldershot, Lib.): Just
> a point of clarification, you said you have to respect the confidentiality
> of the ministers for whom you work. Does that embrace ministers before
> 1997, any ministers you may have dealt with in the years that you--
> > Mr. Charles Guité: It would involve any ministers that I've worked
> with or had discussions with when I was a public servant--
> > Mr. John Bryden: That's going back to...
> > Mr. Charles Guité: --which would be up to 1999 right back to 1963.
> > Mr. John Bryden: Thank you.
> > Now, may I ask you a very, very blunt question, just to cut to the
> quick here. This is referring only to the Groupaction files. Did anyone
> outside the department instruct you in any way to select Groupaction, tell
> you what to expect of Groupaction or tell you what to pay Groupaction?
> > Mr. Charles Guité: It's too broad of a question.
> > Mr. John Bryden: Well, then, let me whittle it down a little bit.
> Did anyone outside the department tell you what to pay Groupaction?
> > Mr. Charles Guité: No.
> > Mr. John Bryden: Did anyone outside the department tell you what to
> expect of Groupaction?
> > Mr. Charles Guité: No.
> > Mr. John Bryden: Did anyone recommend Groupaction?
> > Mr. Charles Guité: No.
> > Mr. John Bryden: Thank you. We covered that fairly well. It may be a
> broad question, but you've answered it very specifically.
> > One of the things that Mr. Quail brought up that was of great
> concern to us was the question that after the internal audit was done one
> of the things that was very evident was there was not adequate
> documentation supporting not only the Groupaction contracts but it appears
> to have been a general problem. Do you have any comment on that? I would
> have thought that someone with your seniority would have expected that the
> file would contain appropriate documentation for this type of contract.
> > Mr. Charles Guité: No, we're not going to discuss any other contract
> but the Groupaction contract.
> > Mr. John Bryden: All right, although I don't see why not
> because...all right, then, let's stick with the Groupaction contract,
> which had omissions in it.
> > Is this the type of expectation that you had of the files when you
> were dealing with other contracts, going back in history again to you are
> a longstanding civil servant who has been involved in many such contracts?
> Was the lack of documentation in the Groupaction file typical of the other
> contracts you might have handled?
> > Mr. Charles Guité: Let me repeat a comment that I made earlier.
> Certainly during the period of the 1995 referendum till 1999, when I left,
> and certainly 1995-96, 1996-97, 1997-98, 1998 and part of 1999, when I was
> there, as I said earlier, we were doing a strategy that we were getting
> results. We knew we were very effective. By not having too many documents
> on file obviously restricted access to that information. That decision--
> > Mr. John Bryden: Well, let's stick--
> > Mr. Charles Guité: Let me finish.
> > That decision was made by me personally. Nobody instructed me not to
> put documents on file or not to put certain information on file. I decided
> that. I was very successful in achieving what the Government of Canada
> wanted to achieve, and that was to have a big presence in Quebec and to
> reduce « le parti séparatiste au Québec », which we have done tremendously
> well.
> > Mr. John Bryden: If I may ask, though, if we were to look further
> back in history, before the referendum, might we find incidents of
> contracts that you've involved in--
> > Mr. Charles Guité: No, if you go--
> > Mr. John Bryden: --in which there was lack of documentation?
> > Mr. Charles Guité: > No, I don't want to go down that road. I'm here
> to talk about, again, the period the Auditor General or the contract the
> Auditor General has picked up. What I've done from 1995 to 1990, during
> the previous administration and the previous and the previous > and the
> previous, we're talking 34 years here. I can't recall--
> > Mr. John Bryden: I don't want to go back that far, but I want to at
> least go back into the Mulroney period to find out whether or not what we
> see, and the lack of documentation, which is crucial to the problem the
> Auditor General encountered: how can you demonstrate that something was
> done if there are no documents. What I would like to know is that if we
> were to investigate further and go beyond the referendum, and I accept
> that the referendum was a very crucial time, but before that would we
> expect to find that there isn't the documents in the file?
> > Mr. Charles Guité: I couldn't remember. I can't comment.
> > Mr. John Bryden: Well, then, let me try another thing. As an
> administrator, do you feel that when you let contracts that the files
> should be maintained to indicate the basic financial obligations are being
> fulfilled, the basic financial records are there? Are you in agreement
> that should be the minimum expectation of an Auditor General and anyone
> else?
> > * (1635)
> > Mr. Charles Guité: The only comment I can make there is that when I
> issued a contract and I was the signing or delegated authority, I issued
> the contract, when I approved the payment of the service defined in that
> contract, I was satisfied the Crown had received value for money.
> > Mr. John Bryden: But, if I may ask, you didn't feel an obligation to
> maintain that in the actual public records, so that--
> > Mr. Charles Guité: I'll repeat again, during the referendum and
> post-referendum, it was my decision to keep very little information on
> file so nobody would have access to it.
> > Mr. John Bryden: So that includes the 1997 period. Because we got by
> the referendum, so the 1997...so in fact--
> > Mr. Charles Guité: It includes the period from the 1995 referendum
> till the day I left the public service in August 1999.
> > Mr. John Bryden: Just one other thing, if I may ask, if I still have
> time, Mr. Chairman.
> > The Chair: You have over two minutes and 15 seconds.
> > Mr. John Bryden: You mentioned that, obviously, you were involved in
> political strategy that may have involved the minister of the day, and
> obviously other ministers of the day going back, as well, presumably,
> because the referendum, and I note, occurred at a time of an entirely
> different minister then was there in 1997. Did you involve Mr. Quail or is
> Mr. Quail involved in these discussions, these--
> > Mr. Charles Guité: On several occasions he was, yes.
> > Mr. John Bryden: Was he always involved?
> > Mr. Charles Guité: Pardon?
> > Mr. John Bryden: Was he always involved?
> > Mr. Charles Guité: I would say most of the time he knew what events
> we were sponsoring because he would get a list of the events that we were
> sponsoring.
> > Mr. John Bryden: Mr. Quail was in the group so you had no
> discussions with the minister that Mr. Quail was not privy to?
> > Mr. Charles Guité: I can't comment on that, based on my initial
> statement.
> > Mr. John Bryden: Again, I guess the verbal arrangements you
> received...you made arrangements verbally with Groupaction, am I to
> understand that?
> > Mr. Charles Guité: That's correct.
> > Mr. John Bryden: Again, I have difficulty. Is it not true that these
> arrangements...are you familiar with the Access to Information Act?
> > Mr. Charles Guité: I sure am.
> > Mr. John Bryden: Are you aware, then, that if you had made
> arrangements and documents were produced that would compromise national
> security or not in the national interest, there's section 22 of the Access
> to Information Act, for example, that would protect documents that you may
> have receive that pertained to direct government operations, advice to
> ministers? Surely the Access to Information Act would have given you ample
> opportunity to have created a documentary record and not to be worried
> that it would be disclosed to the separatist adversaries, whoever they
> were.>
> > Mr. Charles Guité: Hindsight is 20:20.
> > Mr. John Bryden: If I may just, then, ask the final question, now,
> if you were to do it over again, you would have created the records and
> you would have relied on the Access to Information Act to protect the
> secrets?
> > Mr. Charles Guité: Probably, probably. But again, you have to
> remember--and again I'll use the terminology--when you're at war you drop
> the book and the rules and you don't give your plan to the opposition. You
> don't leave your plan of attack on your desk.
> > Mr. John Bryden: Mr. Guité, I have enormous sympathy for that
> response, except that if you block me, as a member of this committee, from
> knowing whether or not your behaviour with respect to documentation did or
> did not exist before the referendum crisis, then I can never satisfy
> myself that you acted entirely in the public interest in not keeping
> properly documented records.
> > Mr. Charles Guité: The only comment I can make there is go and check
> the documents prior to 1995.
> > The Chair: Thank you, Mr. Bryden.
> > Mr. Martin, eight minutes, please.
> > Mr. Pat Martin (Winnipeg Centre, NDP): Thank you, Mr. Guité.
> > The eight minutes goes quickly, so I'm going to be quite brisk with
> this, as well.
> > There is an aspect to every contract that has an account
> verification checklist that you are probably familiar with. When you
> signed off on this contract you would have also had to go through that
> page to check off that the work has been performed, the goods have been
> supplied, and the services have been rendered, and then you check that box
> off.
> > Mr. Charles Guité: I have never used a form like that before I sign
> an invoice.
> > Mr. Pat Martin: Well, that's odd because it's an aspect of all of
> the Groupaction contracts. We have one, two, and three here, and that page
> shows up in every one of them. Two were signed by you, and one was signed
> by Mr. Tremblay, so, somebody, maybe one of your underlings, then, has to
> go through that checklist, because here it is, checked off.
> > Mr. Charles Guité: The way the system works, the way I know it works
> in our department when I was there is, if I got an invoice on my desk for
> payment, and certainly the invoices for the sponsorship program, I was
> aware that the work had been done--
> > * (1640)
> > Mr. Pat Martin: How do you know?
> > Mr. Charles Guité: How do I know? Because I was on top of every
> event.
> > Mr. Pat Martin: And you believe that you got true value at every one
> of these contracts?
> > Mr. Charles Guité: Exactly.
> > Mr. Pat Martin: Even the ones that we can't find any evidence of any
> work having been done.
> > Mr. Charles Guité: The evidence was there when I was there as a
> public servant. If it's not there today, I can't answer that question.
> > Mr. Pat Martin: There's a growing body of evidence, Mr. Guité, that
> would indicate that there was overcharging, and even charging for work
> that possibly wasn't even performed so that those companies could bank
> credits to be recouped at a later date, or pay off, services during the
> 1997 federal election in Quebec.
> > Do you have any knowledge of that?
> > Mr. Charles Guité: Any political things, I decline to answer any
> comments on the politics, I'm not involved in politics.
> > Mr. Pat Martin: Did anybody from the Prime Minister's office ever
> contact you regarding the partnership initiative, or the sponsorship
> contract?
> > Mr. Charles Guité: No comments based on my initial statement.
> > Mr. Pat Martin: Jean Pelletier is not a minister you worked for. Did
> Jean Pelletier call you from the Prime Minister's Office?
> > Mr. Charles Guité: No comments based on my initial comment.
> > Mr. Pat Martin: Actually, your initial comment talked about the duty
> of loyalty towards former ministers. These are not ministers in the Prime
> Minister's Office.>
> > Mr. Charles Guité: The minister's office, and the minister and his
> office, and staff in his office, fall under my definition of the
> minister's office.
> > The Chair: Let me ask this question.
> > Mr. Walsh pointed out the employer-employee relationship, and the
> need for confidentiality, and the respect for that confidentiality, but
> how wide are you drawing this employer umbrella, because now you're
> saying--
> > Mr. Charles Guité: My umbrella, Mr. Chairman, is very clear. If any
> discussions I've had--I'll give you two examples--if I had a discussion
> with the Minister of Public Works, or his staff, that falls under my
> initial statement.
> > The Chair: His political staff.
> > Mr. Charles Guité: His political staff. If I had a discussion with
> the Minister of Finance, I include his staff. If I had a discussion with
> PMO, I include the Prime Minister, and his staff.
> > The Chair: Okay. So any political staff working for any cabinet
> minister, you are claiming privilege?
> > Mr. Charles Guité: Exactly.
> > The Chair: Is that a legitimate claim, Mr. Walsh?
> > Rob Walsh: All the ministers, whether the Minister of Finance, the
> Minister of Public Works, or the Prime Minister, are part of the
> government of Canada at the ministerial level and the same duty of
> confidentiality to the government remain.
> > Mr. Guité's duty of confidentiality is to the government of Canada,
> as opposed to a particular minister of the crown, so, the same
> confidentiality continues when there might be a change in the person
> occupying the position of Minister of Public Works, etc.
> > I think it's a matter one might well question as to what the proper
> ambit of this confidentiality is. We're hearing today testimony relating
> to the some of the dealings within the office, but, then, selectively,
> we're not hearing about other dealings. I'm just not sure, to be frank
> with the committee, I'm not so sure whether the application of the
> confidentiality rule here isn't being applied for--and I don't mean to be
> disrespectful here, Mr. Guité--but isn't being applied for self-serving
> purposes, as opposed to out of a sense of duty to the government of
> Canada.
> > That's something I'm not in a position to judge, I don't know.
> > The Chair: Mr. Walsh, what about discussions with staff of a
> minister, which are political staff, there is no master-servant
> relationship between Mr. Guité, and them. Is that covered by privilege,
> too?
> > Mr. Rob Walsh: The confidentiality, as opposed to privilege--
> > The Chair: The confidentiality.
> > Mr. Rob Walsh: --that Mr. Guité is talking about, I think the
> political staff of a minister are to be taken as surrogates of the
> minister, and they are speaking with him on behalf of the minister. I
> think one would have to acknowledge that conversations with the aides to
> the minister are covered by the same confidentiality obligation as would
> be direct conversations with the minister himself.
> > The Chair: Any further questions on this particular issue to Mr.
> Walsh?
> > Mr. Harb.
> > Mr. Mac Harb: Mr. Walsh, my understanding is that the witness is
> before the committee, the witness would sit here, and tell you, yes, and,
> no, and he would have fulfilled his duty to the committee. It is my
> understanding that we cannot just take a hammer, and start hitting on the
> head of the witness in order to force him to say things he doesn't want to
> say.
> > My understanding is that at the outset he has clearly stated that,
> yes, he had dealings with the minister, and, his, or her, staff, and thus
> said, he is not going to enter into a detailed debate about the content of
> those discussions.
> > Would it be your advice for us to move off that particular element
> now, rather than repeating ourselves every 30 seconds, and ask the same
> question all over again?
> > Mr. Rob Walsh: Well, >
> > The Chair: The members are entitled to ask the questions, and Mr.
> Guité is entitled to answer them as best that he sees fit, or claim the
> privilege of confidentiality, and say he cannot answer. He has to hear the
> question before he can make a decision.
> > * (1645)
> > Mr. Mac Harb: Mr. Chairman--
> > The Chair: Anyway, we'll now get back to Mr. Martin.
> > Oh, Mr. Mayfield.
> > Mr. Philip Mayfield: Mr. Walsh, it's a matter of concern for me to
> know how to decide whether Mr. Guité's answers are fulfilling the
> committee's need to sort out the administrative difficulties that we have
> encountered, or, whether or not, his answers are more to serve his own
> particular needs. I'm having difficulty deciding how to approach this.
> > From your legal point of view, how do we deal with a witness who is
> simply protecting himself in the name of confidentiality with someone
> else?
> > Mr. Rob Walsh: Mr. Chairman, may I suggest to members of the
> committee that they focus on whether the answers received are responsive
> to their questions, rather than whether or not the witness is driven by
> self-serving considerations, or not. The issue is whether the answers are
> in response to your questions. If they are not responsive to your
> questions, by virtue of the indication of confidentiality, then the next
> step might be to consider calling upon the minister to provide the
> information that this witness is not prepared to provide.
> > The Chair: Just one final point on that, Mr. Walsh, when we're
> talking about some fairly wide-ranging number of people involved in
> discussions, it is perfectly legitimate for Mr. Guité to say who he had
> the discussions with. The content of the discussions is what is protected
> by confidentiality. Am I right?
> > Mr. Rob Walsh: That, as I said earlier, would be my view of it, but,
> others might take a different view.
> > The Chair: Okay.
> > Mr. MacKay, do you have something?
> > Mr. Peter MacKay (Pictou-Antigonish-Guysborough, PC): Mr. Chairman,
> as a supplemental to your question, Mr. Chair, to Mr. Walsh, that, would
> therefore include people who worked directly for ministers, or the Prime
> Minister, we should be allowed to ask whether, in fact, Mr. Guité had
> conversations with those individuals, not the content, but whether, in
> fact, there was contact made between persons working in ministers' office,
> and whether conversations happened, or did not happen. Correct?
> > The Chair: Mr. Walsh.
> > Mr. Rob Walsh: That would be my view, Mr. MacKay, but, it may be
> that others have a different view.
> > The Chair: Mr. Bryden.
> > Mr. John Bryden: I would like to make a comment, Mr. Chairman.
> > The issue should be centred on the administration, not the
> minister's office. I think we have to make a distinction here, that this
> committee is charged with examining whether or not Mr. Guité failed, or,
> succeeded, if you would, in the tasks that were set before him as an
> administrator. Obviously, he is in contact with the political arm of
> government in one way or another, but, that's not really the focus of the
> committee. It's whether or not he administered the department in a way
> that is commensurate to his responsibilities.
> > The Chair: It seems to me, Mr. Bryden, that Mr. Guité has found
> himself in a conflict, and I think the line of questioning is quite
> legitimate. He found himself in a conflict of, he felt the rules, because
> he was at war, using his terminology, the rules could be bent, using his
> terminology, and therefore, we now find ourselves in this particular
> situation. The rules were bent, it appears, because the government had a
> particular policy that it wanted to implement, and he has talked about
> that particular policy this afternoon.
> > I think we are into a very difficult, and sensitive area between
> political desires, and public policy, and the implementation according to
> the Financial Administration Act, and the rules of contracting, and so on.
> There seems to be, from what I'm hearing, a direct conflict between the
> two, and Mr. Guit> é is right there in the middle, and was at both sides.
> Therefore, I think it's appropriate that we would find out who the
> political discussions were with in order for us to determine at what level
> was this decision made to bend the rules, if I can use his terminology,
> and so on.
> > I think we're going to start the clock again. Mr. Martin, we're
> going to hand it back to you, and continue on, because you have--is the
> time taken up?
> > Mr. Odina Desrochers (Lotbinière-L> '> érable, BQ): Just 30 seconds,
> sir.
> > The Chair: Mr. Desrochers.
> > Mr. Odina Desrochers: Mr. Chairman, to avoid a recurrence of the
> same problem, with Mr. Walsh> '> s assistance, perhaps we could seek
> written clarification of the point Mr. Guité is making. There seems to be
> some confusion over the interpretation of Mr. Guité> '> s position, versus
> Mr. Walsh> '> s take on the situation. Therefore, without presuming who
> our next witnesses will be or when our next meetings will be held, perhaps
> we should get some clarification of what Mr. Guité is referring to, so
> that Mr. Walsh can better enlighten us.
> > * (1650)
> > The Chair: I think we'll go to Mr. Martin now.
> > Mr. Martin, you've used up two minutes, and twenty-two seconds, so
> you have five minutes and thirty-four seconds, or thereby, left.
> > Please continue.
> > Mr. Pat Martin: Thank you.
> > Mr. Guité, you mentioned that you don't really agree with the
> Auditor General that senior officials, or you, broke all the rules, was
> the quote.
> > Do you believe that you were operating within the policy guidelines
> of public works when you were awarding the Groupaction contracts?
> > Mr. Charles Guité: Yes.
> > Mr. Pat Martin: So you don't accept that you broke all the rules.
> > There's a contract here that you've signed, for $615,000 to
> Groupaction to analyze the effectiveness of Ottawa sponsorship of outdoor
> events, and to present an analysis of opportunity to the federal
> government to enhance its visibility.
> > This contract was awarded without competition. Did you authorize
> this contract, by the way?
> > Mr. Charles Guité: No. Let me go back.
> > The contract was not awarded without competition. There was a
> competition done in 1995, during the referendum, where we qualified five
> firms out of about ten we interviewed, if I remember correctly.
> > Mr. Pat Martin: I understand that part of it. I don't have time to
> go through all that--
> > Mr. Charles Guité: But, based on that, I decided to use Groupaction
> to do subsequent work, and the work includes--
> > Mr. Pat Martin: --the three qualified contractors.
> > Mr. Charles Guité: --and the work includes the three contracts.
> > Mr. Pat Martin: Right.
> > Now, this $615,000 contract produced a 20-page paper listing
> projects that wanted government money. Do you believe that was good value?
> > Mr. Charles Guité: The report was probably one-tenth of the advice
> that I received from Groupaction.
> > Mr. Pat Martin: The other advice was oral?
> > Mr. Charles Guité: That's correct.
> > Mr. Pat Martin: For $615,000.
> > Now, Groupaction, within your own policy guidelines, you say you
> didn't bend the policy guidelines, there's a maximum amount that a person
> can bill themselves out as. The director of a communications contracting
> firm can bill themselves out at a maximum of $150.00.
> > Mr. Charles Guité: No, not that I'm aware of.
> > Mr. Pat Martin: Well, it's right here. I can show you where that's
> the case. In fact, it specifies even what the secretary and the clerical
> staff can be charged out at, a maximum of $25 there.
> > In the invoices that you signed, Brault was signing himself out at
> $252 per hour. Lyse Georges was $227 per hour, far in excess of the
> maximum in your own policy guidelines.
> > Mr. Charles Guité: > No. I can't remember that there is a set amount
> that agencies can charge. In fact, in my experience of all the ad
> agencies, and the communication agencies I've done business with in the
> last 34 years, rates vary from agency to agency. If you're> going to hire
> the top executive of a major advertising firm versus the top executive of
> a very small firm, you can be sure that you are going to pay different
> rates, and those rates can vary 100% to 150%.
> > Mr. Pat Martin: Where is the accountability, where is the
> transparency in a situation where you spent $615,000 for a 20-page report,
> and the rest of the benefit was verbal, over the telephone advice. How
> does the public know their money is being spent well, and accounted for
> when it's on the basis of a phone call between you, and I presume, the
> head of Groupaction?
> > Mr. Charles Guité: The proof is in the pudding. Look at the results
> of what we've achieved in la belle province
> > Mr. Pat Martin: Do you own a red Mustang, Mr. Guité?
> > Mr. Charles Guité: No.
> > Mr. Pat Martin: Did you used to?
> > Mr. Charles Guité: Yes.
> > Mr. Pat Martin: Did you sell it?
> > Mr. Charles Guité: That has nothing to do with this committee.
> > Mr. Pat Martin: Did you sell it to Groupaction?
> > Mr. Charles Guité: That has nothing to do with this committee.
> > Mr. Pat Martin: Yes, it does. We're trying to illustrate, we're
> trying to--
> > The Chair: events, you can indicate what this vehicle has to do with
> maladministration in the government.
> > Mr. Pat Martin: We believe it would be improper to have a
> relationship with one of these contracting firms, above and beyond, just a
> professional relationship.
> > We have been told, and we would like you to be able to confirm it,
> that when you sold your red Mustang, you sold it to Groupaction, or at
> least at Groupaction to help you out from out of these heavy payments.
> > The Chair: Okay, now, just a second, Mr. Martin.
> > Mr. Martin has asked a question about whether there's some financial
> transactions between--

>
>
>
> > Mr. Pat Martin: Of benefit accrued.
> > The Chair: --the civil servant, Mr. Guité, and a client he was
> dealing with, which was the Groupaction. It doesn't seem to be that much
> different than what Mr. Boudria got himself into a few weeks ago, and,
> therefore, I see no reason why Mr. Guité can't answer the question.
> > Mr. Pat Martin: There's nothing to do with a minister there, is
> there?
> > * (1655)
> > Mr. Charles Guité: I decline.
> > The Chair: Does he have the right to decline, Mr. Walsh?
> > Mr. Pat Martin: This is not helpful at all.
> > Mr. Rob Walsh: I would ask on what basis Mr. Guité has declined to
> answer the question.
> > Mr. Pat Martin: He doesn't want to. He doesn't feel like it.
> > Mr. Charles Guité: It has nothing to do with the three contracts
> that we're reviewing here today.
> > Mr. Pat Martin: It has to do with the relationship, a possible
> relationship, between Groupaction, the very contractor, and you, a civil
> servant. It would be improper to benefit in any way, shape or form, even
> if that's just the convenience of having somebody take an expensive car
> off your hands. It would indicate to me far too cozy a relationship. I
> want to know if this is true.
> > Mr. Charles Guité: No comments.
> > The Chair: I don't think that you can say > "> no comment> "> , Mr.
> Guité. It's a legitimate question by a member of Parliament in the
> administration of public funds. I mentioned that Mr. Boudria, a former
> Minister of Public Works, had a financial involvement with one of the
> contractors of public works a few weeks ago. It became public knowledge
> and everybody knows the outcome of that. If Mr. Martin feels there's
> something of a similar vein here, I think you have an obligation to answer
> the question: yes, you had, or, no, you didn't.
> > Mr. Pat Martin: Who did you sell your car to? That's all we need to
> know. It's a straightforward question, really.
> > The Chair: Mr. Guité, your answer.
> > Mr. Charles Guité: The answer is, yes.
> > Mr. Pat Martin: You--
> > Mr. Charles Guité: I sold him it.>
> > Mr. Pat Martin: --sold your car to--
> > Mr. Charles Guité: Yes.
> > Mr. Pat Martin: To the actual company or to an individual--
> > Mr. Charles Guité: To an individual.
> > Mr. Pat Martin: To a director of the company?
> > Mr. Charles Guité: That's correct.
> > Mr. Pat Martin: Mr. Brault?
> > Mr. Charles Guité: Yes.
> > The Chair: Okay, Mr. Martin, your time is up.
> > Now, we are going to move to Mr. MacKay.
> > Mr. Peter MacKay: Thank you, Mr. Chair, Mr. Guité, counsel, all the
> witnesses for being here again.
> > I want to turn it back to the actual Auditor General's report, of
> which I'm sure you've read in meticulous detail. There are some fairly
> scathing comments that reflect directly on the performance of your job.
> You would agree with that?
> > Mr. Charles Guité: No, I don't agree.
> > Mr. Peter MacKay: No? I'm quoting the view of the Auditor General's
> directly from the report at page 7, paragraph 33:
> > In our view, the public servants involved in the administration of the
> three contracts did not discharge their responsibilities with due care and
> diligence. Officials provided payments for work that varied considerably
> from the work stipulated in the contracts.
> > It states in other paragraphs, specifically paragraph 29:
> > A retired executive director of CCSB informed us that a significant part
> of the total amount of the contractor received under the first two
> contracts had paid for not only reports, but also verbal advice,
> discussion and strategic information.
> > You've confirmed that. That did take place.
> > Mr. Charles Guité: That's correct.
> > Mr. Peter MacKay: So there was hundreds of thousands of dollars paid
> for advice that you received orally. There's no written confirmation. Is
> that correct?
> > Mr. Charles Guité: That's correct.
> > Mr. Peter MacKay: And it goes on to say that > "> ...no notes or
> copies of any correspondence in the files or the type or extent of
> information or advice received> "> . So there was no documentation
> whatsoever to verify this information was in fact received. Correct?
> > Mr. Charles Guité: That is correct.
> > Mr. Peter MacKay:
> > In fact, for the most part, the file were poorly documented. The
> executive director of the CCSB told us that this was how business was done
> while he was responsible for the program.
> > That's you that she's talking about. Correct?
> > * (1700)
> > Mr. Charles Guité: That's right.
> > Mr. Peter MacKay: And that was all done, business was done that way,
> because you feel it was all justified because you were at war.
> > Mr. Charles Guité: That's correct.
> > Mr. Peter MacKay: So, therefore, there's a bunker mentality that you
> bunker down and you don't tell people what you're doing when you're at
> war. You feel you were justified in doing that.
> > Mr. Charles Guité: Yes, I was justified. And I got good value and I
> got good results.
> > Mr. Peter MacKay: And you would do it again, you've told us.
> > Mr. Charles Guité: If I had to do it again under the same
> circumstances, yes.
> > Mr. Peter MacKay: So what happens to the obligation that you as a
> public servant have, sir, to the public--not to your political masters,
> not even to the Financial Services Act--to account to the public that
> money was spent for value? Just your word, is that what you're telling us,
> that we should just take you at your word?
> > Mr. Charles Guité: No, no, no. Look at the results.
> > Mr. Peter MacKay: Look at the results.
> > Mr. Charles Guité: Look at the results.
> > Mr. Peter MacKay: You're attributing your work and the handing out
> of contracts for hundreds of thousands of dollars for advertising to
> saving the country, that's what you're telling us?
> > Mr. Charles Guité: You want to believe it. You want to believe it.
> > Mr. Peter MacKay: Yes? You really believe that?
> > Mr. Charles Guit> é: Yes, I do. And why did the Government of Quebec
> create the equivalent of Communications Canada called Communications
> Québec? Why is the Quebec government putting money into sponsorship?
> Because we killed them, that's why.
> > Mr. Peter MacKay: I see. So it was done, it was a war that you were
> in, and we should just take your word for it that what you did was
> justified?
> > Mr. Charles Guité: Look at the results.
> > Mr. Peter MacKay: Look at the results. This sounds very familiar.
> This is what the Prime Minister says: the end justifies the means.
> > Mr. Charles Guité: The Prime Minister can say what he wants.
> > Mr. Peter MacKay: Okay. And you're telling us that your duty to the
> public, your duty to be open and honest and transparent about what that
> information was, is you're justified in not telling us that because it
> would somehow jeopardize or it would now undo the work that was done?
> > Mr. Charles Guité: No, no. I feel very, very good about what I did
> and I think the Government of Canada got value for their money and they
> got results.
> > Mr. Peter MacKay: Tell me this, what was that information? What was
> that information that you received that was so valuable it saved the
> country?
> > Mr. Charles Guité: Who was going to be there, what type of crowds
> were going to attend, was the Government of Quebec going to be present,
> who were the other sponsors who were at the event. It could be anybody
> from Hydro Québec to any other, Casino and so forth, quasi-government
> organizations in Quebec. It was very important for me to know who's going
> to be at those events.
> > Mr. Peter MacKay: Why couldn't that have been written down?
> > Mr. Charles Guité: Because I decided not to write it down so it
> wouldn't be accessible.
> > Mr. Peter MacKay: Wouldn't be accessible to whom?
> > Mr. Charles Guité: Somebody asking for it through Access to
> Information.
> > Mr. Peter MacKay: You heard Mr. Bryden refer--
> > Mr. Charles Guité: Yes, I did, and I said to you--
> > Mr. Peter MacKay: --to the fact that information would be protected?
> > Mr. Charles Guité: And I said to Mr. Bryden 20:20 is hindsight.
> > Mr. Peter MacKay: So you would do it differently now.
> > Mr. Charles Guité: Definitely.
> > Mr. Peter MacKay: Because you're now being called to account for
> what you did.
> > Mr. Charles Guité: No, no. There was nothing done illegal. What I've
> done, I've done it very well--
> > Mr. Peter MacKay: Well, that remains to be seen. You've told us that
> what you did you feel you were justified in doing--
> > Mr. Charles Guité: Yes.
> > Mr. Peter MacKay: --and that you would do it again.
> > Mr. Charles Guité: Yes.
> > Mr. Peter MacKay: So the explanation for the reasons as to those
> contracts being set out, who was receiving them, the additional increased
> payments that you authorized, all of that was done on oral advice. There's
> no documentation of that. You feel that you don't have to report that to
> the public or you don't have to report that even to the Auditor General.
> > Mr. Charles Guité: No. There were contracts there, there was work
> performed and there were invoices paid.
> > Mr. Peter MacKay: But there was no documentation. I'm quoting
> directly, > "> The government's file...> "> --
> > Mr. Charles Guité: I know and--
> > Mr. Peter MacKay: Just listen to me for a minute, sir. Paragraph 28:
> > The government's files were so poorly documented that many key questions
> remain unanswered surrounding the selection of the contractor and the
> basis for establishing the price and scope of the work of the contracts.
>
> > Those are the words of the Auditor General, who is an officer of
> Parliament and has to report to the public. She can't provide this
> information to the Parliament of Canada because you didn't document
> anything.
> > Mr. Charles Guité: That is correct.
> > Mr. Peter MacKay:> And you feel that's okay.
> > Mr. Charles Guité: Yes.
> > Mr. Peter MacKay: Well, I'm suggesting to you that it's not okay,
> sir. I'm suggesting that something is clearly wrong and yet you don't seem
> to have any bout of conscience, you don't seem to have any ability to
> justify it.
> > The Chair: Mr. MacKay.
> > Mr. Peter MacKay: Okay.
> > So let me ask you about the increased payments. There is an
> indication in some of the files that there was a 12% fee that was a
> top-up. That was given to contractors. Are you aware of that?
> > Mr. Charles Guité: Definitely.
> > Mr. Peter MacKay: And what was that for exactly?
> > Mr. Charles Guité: The fee, the 12% commission, is based on industry
> standards, which is normally 15% on advertising communication. In this
> case 3% went to the agency of record who paid the invoiced and ensured the
> post mortem and the work was properly done, and the 12% is the commission
> that went to the agency assigned to those events.
> > Mr. Peter MacKay: But how do we know the work was properly done,
> back to my original question?
> > Mr. Charles Guité: Because I'm satisfied at the end of the day that
> visibility was there, and it was confirmed by the agencies that the
> visibility was there, and I paid their 12% commission.
> > * (1705)
> > Mr. Peter MacKay: You, and you, alone?
> > Mr. Charles Guité: Myself, and some of my staff.
> > Mr. Peter MacKay: Okay, how many other staff did you have?
> > Mr. Charles Guité: Oh, 1995-1997, I had about 14 people on staff;
> 1997, until I left, probably 250.
> > Mr. Peter MacKay: Two hundred and fifty staff. Who worked directly
> in the office with you that would receive these reports?
> > Mr. Charles Guité: I would have to go back to the files and get
> those. The staff has changed over the years; there were several people.
> > Mr. Peter MacKay: I was told that there was two people who worked in
> the office. Is that correct? There were two direct staff people who worked
> in your office?
> > Mr. Charles Guité: No.
> > Mr. Peter MacKay: That's not correct?
> > Mr. Charles Guité: No.
> > Mr. Peter MacKay: Was there additional staff that came and went
> during your period?
> > Mr. Charles Guité: If I go back, 1995-1997, we were about eight.
> > Mr. Peter MacKay: When you came into this position, you told
> us--well, when did you first start in this particular role?
> > Mr. Charles Guité: In 1985-86.
> > Mr. Peter MacKay: And during the course of that time, or prior to,
> you were made aware of your obligations under the Financial Administration
> Act, the Treasury Board guidelines, the Department of Public Works
> guidelines?
> > Mr. Charles Guité: Definitely.
> > The Chair: Mr. MacKay.
> > That completes round one. We're now moving on to round two, and
> that's a four-minute round.
> > We'll start with Ms. Meredith, please.
> > Ms. Val Meredith (South Surrey-White Rock-Langley, Canadian
> Alliance): Thank you, Mr. Chair.
> > I want to follow up on something that was said earlier. You
> mentioned that you met on a regular basis with the minister, and the
> deputy minister. When you said regular basis, what did you mean by that?
> > Mr. Charles Guité: Sometimes, once a week. Sometimes, twice a week.
> Sometimes, three times a week.
> > Ms. Val Meredith: So, very regularly, then?
> > Mr. Charles Guité: Yes.
> > Ms. Val Meredith: I want to go to the first contract that you had.
> You doubled it, from $250,000 to $500,000. Under page 4 of that contract,
> it says that the limitation of expenditure, Her Majesty's liability to the
> contractor under this contract shall not exceed $250,000, plus goods and
> services tax, unless otherwise authorized in writing by the minister.
> > Did you get that authorization?
> > Mr. Charles Guité: I would assume that my delegation allowed me to
> do that.
> > Ms. Val Meredith: According to this contract, only the minister has
> the ability to change the amount, unless otherwise authorized in writing
> by the minister. It doesn't say by the deputy minister, it doesn't say
> anybody else.>
> > Mr. Charles Guité: I'm not a contracting officer, so I couldn't
> answer that question.
> > Ms. Val Meredith: Excuse me. I want to follow up on this.
> > This is part of the contract that you signed on September 18, 1996.
> This is part of a contract that you signed. I'm sorry, that was when you
> changed that contract. You signed the contract on July 2, 1996.
> > Mr. Charles Guité: Yes, it would be the amendment.
> > Ms. Val Meredith: The amendment, which you did, you said you did on
> your own, the contract that you signed says that only the minister, in
> writing, not verbally, but, in writing, the minister has to agree to any
> change in that.
> > Did you get, in writing, by the minister, authorization for you to
> change the amount?
> > Mr. Charles Guité: No, not that I can recall.
> > Ms. Val Meredith: So, under what authority did you change the
> amount?
> > Mr. Charles Guité: My delegation authority that I had from the
> deputy, I would assume, and if the contract went through the system I
> would assume it was appropriate.
> > Ms. Val Meredith: So, you feel that you had the authority to change
> the amount, to double the amount, you felt that you had the authority to
> pick which contract, or which agency, would get it.
> > You mentioned that there were five agencies that were picked out of
> the ten. You interviewed ten, you picked five. Were those five wired
> contracts?
> > Mr. Charles Guité: Were they what?
> > Ms. Val Meredith: Were they agency wired contracts?
> > Mr. Charles Guité: I don't understand the question.
> > Ms. Val Meredith: A wired contract is where there are special
> mandatory provisions within the contract, so that you're compelled to
> select a certain agency.
> > Were these contracts wired contracts that compelled you to hire the
> agencies that you did?
> > Mr. Charles Guité: It's still not very clear what you're trying--I
> don't understand your--
> > Ms. Val Meredith: Okay. How did you select the five?
> > Mr. Charles Guité: We interviewed, and, again, I would have to go
> back to the file. But, if I remember right in my discussion in 1995, with
> FPRO, and it could be 12, it could be 10, it could be 11, it could be 13--
> > Ms. Val Meredith: How did you select the five?
> > Mr. Charles Guité: Based on a scope of work that we gave to those
> agencies, and we said, give us your proposal on how you would address
> these issues. Obviously, these issues were related to the referendum
> coming up in Quebec. Based on those submissions submitted by those
> agencies, we evaluated the submission, and selected what we felt were the
> five best agencies.
> > * (1710)
> > Ms. Val Meredith: So, you weren't told by the minister's office in
> your weekly, bi-weekly meetings what expectations these contracts were to
> have, and that these agencies were the only ones that fulfilled those
> expectations.
> > Mr. Charles Guité: The decision of who was hired was made by myself,
> and my staff, and some people at FPRO.
> > The Chair: Ms. Meredith, that's right on the button for four
> minutes.
> > I've been focusing on some other things.
> > We're going to go to Mr. Desrochers, then we'll go to Mr. Shepherd.
> Four minutes.
> > Mr. Odina Desrochers: Thank you, Mr. Chairman.
> >
> > Mr. Guité, when you say you retained five firms, who was responsible
> initially for selecting the 11 or 12 firms in the running?
> > Mr. Charles Guité: That was selected by myself, some of my staff,
> and some of the staff at FPRO.
> > Mr. Odina Desrochers: Were these firms invited to make submissions
> or was the process open to public tender?
> > Mr. Charles Guité: No. It was not a public tender process because we
> did not want to broadcast what we were doing. So we selected 10 or 12
> firms, based on my knowledge, knowledge of FPRO people at the time, and
> some of my staff, and we invited those 10 or 12 firms.>
> > Mr. Odina Desrochers: Because a referendum was in the offing.
> However, once the referendum was over, what justification did you have for
> continuing to award contracts with the five firms that had initially been
> selected under special circumstances?
> > Mr. Charles Guité: Because of the results we've got from those firms
> during the referendum.
> > Mr. Odina Desrochers: Political results, financial results or
> results of visibility?
> > Mr. Charles Guité: No. Results of visibility, and effectiveness of
> communication.
> > Mr. Odina Desrochers: When you say that you had the authority to
> adjust the value of the first contract, to double the amounts, were you
> following existing directives? I would imagine that directives are in
> place governing the contracting process. Based on which directives did you
> make this decision?
> > Mr. Charles Guité: Again, I'd have to go back to the contract
> regulations, and I could be wrong here.
> > If I recall, you can amend a contract up to, and including, the
> initial amount, but you can't go over the amount. In other words, if a
> contract is issued for $250,000, you can amend up to $250,000, but you
> can't amend, let's say, to $300,000.
> > Mr. Odina Desrochers: Therefore, you decided to double the value of
> the contract all on your own. Is that what you> '> re saying?
> > Mr. Charles Guité: As I stated before, it was my decision based on
> discussions I had with Groupaction, to double the value of the contract.
> > Mr. Odina Desrochers: Without wanting to stray from the subject at
> hand, was Groupaction the only firm to have its contract amended in this
> fashion?
> > Mr. Charles Guité: I can't recall. I would have to go back to the
> files, and check the other files.
> > Mr. Odina Desrochers: Excuse me, but the value of a signed contract
> was doubled, under very exceptional circumstances. You have no
> recollection of any other similar cases?
> > Mr. Charles Guité: I used to sign, I don't know how many contracts a
> day, or a week, or a month, but several. So, to recall that I doubled
> other contracts, or amended other contracts, I'd have to go back to the
> files and check it.
> > I think I'd be very clear that there is no question, I probably
> amended other contracts upwards during that period of time with other
> firms.
> > Mr. Odina Desrochers: Your department prepared an internal audit
> report, or so we> '> ve been told. In the case of Groupaction, contract
> values were adjusted upward. Did you receive additional instructions as to
> how you should proceed?
> >
> > Mr. Charles Guité: I> '> m not clear on the question.
> >
> > Mr. Odina Desrochers: Given that there is an internal audit report
> that has been widely consulted, you> '> re telling us that you had the
> authority to adjust Groupaction contracts and that you in fact doubled the
> value of the contracts. I asked if you have had occasion to adjust the
> contracts of any of the other firms, and you seem to be inferring that you
> in fact have done so. Following the report> '> s publication, given that
> you continued to enjoy considerable latitude and that we> '> re still
> looking for the supporting documentation, did you receive further
> instructions regarding your decision-making authority?
> > Mr. Charles Guité: No, I don't think so. When was that report done?
> The report you're talking about is what report?
> > Mr. Odina Desrochers: Look, I don> '> t want to start an argument,
> but we discussed this report at considerable length this morning and the
> media has been talking about it as well. I> '> m referring to the internal
> audit report on the sponsorships awarded. Apparently, there were as many
> oversights on the department> '> s part as there were deficiencies
> identified within the firms. Haven> '> t you seen the report? Haven> '> t
> you heard about it?
> > Mr. Charles Guité: No. That audit was done after I left the
> government.
> > The Chair: Thank you, Mr. Desrochers.>
> > Mr. Shepherd, please. Four minutes.
> > Mr. Alex Shepherd (Durham, Lib.): Mr. Guité, this contrived absence
> of documentation, is that process also carried out with Groupaction? In
> other words, did they similarly not maintain records?
> > * (1715)
> > Mr. Charles Guité: Who? The agency?
> > Mr. Alex Shepherd: Correct.
> > Mr. Charles Guité: I can't comment on the agencies.
> > Mr. Alex Shepherd: The monies that were expended, you're saying, on
> these three contracts, we got value for our money, somehow? Was all that
> money spent in sponsorships?
> > Mr. Charles Guité: No. In fact, the money came from the sponsorship
> budget. But those actual reports are not sponsorships. Those reports are
> reports that provided advice, and a list of events that would take place,
> and, again, who would be there, and so forth. But those are not actual
> sponsorship, like the Molson Indy, in Toronto, or the Grand Prix in
> Montréal.
> > Mr. Alex Shepherd: So, when you used to advice, a sort of general
> description, did you pay people to do certain things? Did you contract
> people to perform certain things that were outside of the sponsorship
> program?
> > Mr. Charles Guité: No. What I paid them for was to produce a report,
> and to provide strategic advice, that I repeat, was done verbally. It was
> very important for me to know, for example, that Le Grand Prix de
> Trois-Rivières, the casino from Québec and Montréal is going to be there,
> and the government of Québec is going to be there, and so forth.
> Groupaction had several people working on those events because, as you
> know, how many events did we sponsor in
> > la belle province.
> > Mr. Alex Shepherd: You're trying to convince us that to stay in
> Canada the only thing you have to do is to make sure that the government
> of Canada has displayed a local sporting function.
> > Mr. Charles Guité: That's not what I'm trying to convince you, sir.
> > What I'm saying to you is that the little bit that we did, and we
> being, my organization--
> > Mr. Alex Shepherd: Is any of it illegal?
>
> > Mr. Charles Guité: No. Why would it be illegal?
> > Mr. Alex Shepherd: I don't know. We have no knowledge of what you
> spent the money on, so now that we ask the question if it was illegal--
> > Mr. Charles Guité: No. If we did a sponsorship event with the Molson
> Indy in Montreal, or Le Festival de la tarte au sucre or les Cantons de
> l'Est or whatever, we paid those event organizations a certain amount of
> money to have certain visibility, which was negotiated by the agencies.
> > Mr. Alex Shepherd: But why were you ashamed of it? Why couldn't you
> write down the list of people who were going to show up?
> > Mr. Charles Guité: Why wouldn't I do it?
> > Mr. Alex Shepherd: Why wouldn't you write a list of it? Why is it so
> important that this be contrived, that those files are absent from all
> this information? What is so politically sensitive about knowing who is
> going to show up at the local casino--
> > Mr. Charles Guité: Not who as individuals attending the event, but
> who is going to be there sponsoring it, is very important.
> > Mr. Alex Shepherd: But this must be public knowledge, in any case.
> > Mr. Charles Guité: Not necessarily.
> > Mr. Alex Shepherd: Why did you leave the government in September 1,
> 1999?
> > Mr. Charles Guité: Because I turned 55 years of age, and if I stayed
> in the government I would have got 30% of my salary to keep doing what I
> was doing. After 34 years, and a bit, I decided it was time to go.
> > Mr. Alex Shepherd: It was described to us that you seemed to be
> there one day, and gone the next.
> > Mr. Charles Guité: No. In fact, I was going to leave on April 1,
> 1999, which was my birthday month, and the deputy minister asked me if I
> would stay on for four or five months longer because of the replacement
> that was replacing me, Mr. Tremblay, had arrived in February, and did not
> have a chance, obviously, to do a transition. So I agreed to delay my
> retirement until the end of August.>
> > Mr. Alex Shepherd: You said you touched these three reports, even
> though they can no longer be found, two of them, at least.
> > Mr. Charles Guité: No. I have seen the three reports, and I've
> touched the three reports.
> > Mr. Alex Shepherd: Why are they missing now?
> > Mr. Charles Guité: Ask the current administration.
> > Mr. Alex Shepherd: Do you have any knowledge in shredding?
> > Mr. Charles Guité: They were there when I was there.
> > The Chair: Thank you, Mr. Shepherd.
> > Mr. Murphy. Four minutes, please.
> > Mr. Shawn Murphy (Hillsborough, Lib.): Thank you, Mr. Chairman.
> > Mr. Guité, do I take it it's your belief that in the three
> Groupaction contracts that all provisions of the Financial Administration
> Act were followed?
> > * (1720)
> > Mr. Charles Guité: Yes.
> > Mr. Shawn Murphy: And it's your belief also that all provisions of
> government contract regulations were followed?
> > Mr. Charles Guité: Yes.
> > Mr. Shawn Murphy: Now, you say you were at war, but we're dealing
> with public money and we have to account for this public money. One thing
> I wanted to get absolutely clear here, the Auditor General has identified
> a fairly substantial mess that we have to try and get to the bottom of.
> The first question that I'd like to get answered, I guess, is who's
> responsible.
> > Now, Mr. Quail has testified before this committee and he has given
> evidence that he trusted the people that run this agency, that he wasn't
> supervising it and he thought that everything was being done. One would
> expect to see the checks and balances and the processes that are called
> for in normal government operations but that aren't present in this case.
> It seemed to be a rogue agency reporting to no one. But my question to
> you, sir, is that this mess--and perhaps you don't agree that it is a
> mess--you're responsible.
> > Mr. Charles Guité: Yes.
> > Mr. Shawn Murphy: There's no one else that you're pointing the
> figure at.
> > Mr. Charles Guité: No.
> > Mr. Shawn Murphy: If there is a mess in this report, it's the sole
> responsibility of Mr. Charles Guité.
> > Mr. Charles Guité: That's correct.
> > Mr. Shawn Murphy: Thank you.
> > I want to follow up on this issue of a missing contract. I'll just
> follow up what Mr. Shepherd has indicated.
> > If we have a situation where a report was done, an invoice for
> $550,000 was rendered, the invoice was paid, now, normal commerce would
> indicate that report should be in the hands of the government. Normal
> commerce would indicate that report should be in the hands of Groupaction.
> That report is not present. Nobody can find that report. Somebody has
> given us a copy of a previous report, but...we have to make an assessment
> of your credibility. We're getting to a point that's getting almost
> ridiculous to say that Groupaction doesn't have the report, the government
> doesn't have the report. Can you elaborate any?
> > Mr. Charles Guité: I'll restate what I've said earlier. I have seen
> the three reports. Other people on my staff when I was there have seen it.
> People have put it on file. Shortly after I left, somebody apparently
> referred to the second report. Today, it's gone. I can't comment what
> happened after I left.
> > Mr. Shawn Murphy: But Groupaction would have a copy of the report.
> > Mr. Charles Guité: I don't manage Groupaction.
> > Mr. Shawn Murphy: Have you ever worked for Groupaction?
> > Mr. Charles Guité: Pardon?
> > Mr. Shawn Murphy: Have you ever worked for Groupaction?
> > Mr. Charles Guité: No.
> > Mr. Shawn Murphy: Have you ever contacted Groupaction to ask them if
> they have a copy of this report?
> > Mr. Charles Guité: No, because I was gone when all this issue
> started. Why would I call Groupaction?
> > Mr. Shawn Murphy: But this is an extremely strange scenario that
> we're dealing with that no one has a copy of this report. You agree with
> that?>
> > Mr. Charles Guité: Sure, I agree with it.
> > Mr. Shawn Murphy: And you have no explanation?
> > Mr. Charles Guité: No, no. They were there when I was there and
> today they're not there. If Groupaction doesn't have a copy, I can't
> manage the agencies and the firms. That's their problem, not mine.
> > Mr. Shawn Murphy: Nothing further.
> > The Chair: Thank you, Mr. Murphy.
> > Mr. Ritz, please, four minutes.
> > Mr. Gerry Ritz (Battlefords-Lloydminster, Canadian Alliance): Thank
> you, Mr. Chairman.
> > Mr. Guité, you claim you are at war. Were you a captain in the
> trenches or were you the general?
> > Mr. Charles Guité: All of the above.
> > Mr. Gerry Ritz: Okay, a one-hit wonder.
> > I would also say that this is more about damage control than being
> at war. It was an embarrassment to the Prime Minister, that whole
> referendum.
> > Some hon. members: Oh, oh.
> > The Chair: Order, order.
> > Mr. Gerry Ritz: The Sponsorship Program was the brainchild of the
> Prime Minister. It was his public policy. It was his idea in 1995.
> > Mr. Charles Guité: I can't recall.
> > Mr. Gerry Ritz: There had to be money allocated for it. It had to
> come from somewhere. It's a done deal. Okay? Did you have a mandate for
> that Sponsorship Program or did you just make it up as you went along?
> > Mr. Charles Guité: No, no.
> > A voice: One second.
> > A voice: Okay, now repeat the question.
> > Mr. Gerry Ritz: Okay. Was there a mandate for the Sponsorship
> Program when it became public policy or did you make it up as you go
> along?
> > Mr. Charles Guité: What do you mean by > "> a mandate> "> ?
> > Mr. Gerry Ritz: Well, did you have a direction? You had a budget of
> money, there was money allocated for it. Was there a game plan? You talked
> with the minister once, twice, three times a week--
> > Mr. Charles Guité: No, no, that meeting--
> > Mr. Gerry Ritz: --you worked on a cabinet communications committee.
> Was there a mandate, checks and balances, are we winning or are we losing?
> Overall, would you say you won?
> > Mr. Charles Guité: Let me try to give you un aperçu of how this came
> about.
> > Obviously, after the referendum, and obviously, the results, and,
> again, I would have to refer to the files to make sure these numbers are
> accurate, but, if I remember right, the first amount of the sponsorship
> program when it started, after the referendum, was around $15 million, if
> I recall the numbers right. Subsequent to that, after looking, and then,
> with that $15 million we started to pick certain events that we would do.
> Obviously, depending on the size of the events, and the number, you don't
> go too far with $15 million, even though $15 million is a lot of money.
> > If I recall, in 1996, I prepared a Treasury Board submission to
> increase the amount to $30 million a year for sponsorship. Again, you
> would have to check the figures. There are documents there that would show
> the Treasury Board submission, I am sure. Then, there was another
> submission prepared, I would say, 1997, 1996-97, that increased the budget
> to $40 million a year. If I recalled what I've read in the press, mind
> you, I don't believe the press too much, but, I think that number is still
> valid today, that it's around $40 million, the sponsorship program.
> > * (1725)
> > Mr. Gerry Ritz: Also, part of the sponsorship program, there was a
> position created of a liaison between the CCSB, and higher up. Who was
> that person?
> > Mr. Charles Guité: Myself.
> > Mr. Gerry Ritz: You were the liaison? You, and you, alone? So you
> reported directly to the minister, to the PMO, to the communications
> cabinet committee?
> > Mr. Charles Guité: No. No. I reported to Mr. Quail on an
> organization chart that still exists, I'm sure, today. At the level I was
> in the department, like any other assistant deputy minister, I had
> contacts regularly with the minister's office.>
> > Mr. Gerry Ritz: Alright. Mr. Tremblay was your replacement, and you
> spent five months training him, April, through until September 1. Did Mr.
> Tremblay ever express doubts about signing off on the third Groupaction
> contract? The checklist was done and was approved in June, and--
> > Mr. Charles Guité: I was not there when that was signed.
> > Mr. Gerry Ritz: But the checklist was done in June.
> > Mr. Charles Guité: I was not there when the invoice was paid, and I
> was not involved in a final payment--
> > Mr. Gerry Ritz: Did he ever express doubts to you, before September
> 1, that he had a concern with paying that contract?
> > Mr. Charles Guité: No, never.
> > The Chair: Thank you, Mr. Ritz.
> > Mr. Harb, for four minutes.
> > Mr. Mac Harb: Thank you, Mr. Guité. I appreciate your appearing
> before the committee. I know how difficult it is for you to be subjected
> to a barrage of questions, some of which may be out of line.
> > Mr. Charles Guité: Not necessarily, no.
> > Mr. Mac Harb: I wanted to ask you to give us a little bit of a
> background, in 1995, during the referendum. Was the budget to your
> department cut at that time? Did you suffer the same sort of thing other
> departments have suffered?
> > Mr. Charles Guité: Yes.
> > Mr. Mac Harb: Did the Separatists benefit as a result of the budget
> cut--
> > Mr. Charles Guité: Did the--
> > Mr. Mac Harb: Did the Separatists in Quebec, did they suffer as a
> result of that, or did they benefit as a result of that cut?
> > Mr. Charles Guité: I don't understand your question.
> > The Chair: I think that question is out of order.
> > Mr. Mac Harb: Is it? Why? I'm leading. Can you give us some details,
> and some of the background information about the sort of thing that the
> Parti Quebecois will do in Québec that have sort of intrigued you, and
> gave you an idea, or gave you a venue to accelerate your sponsorship, and
> your involvement. Can you give us some background.
> > The Chair: We have a point of order, here.
> > Ms. Meredith.
> > Ms. Val Meredith: It's not on the three reports.
> > Mr. Mac Harb: It is, Mr. Chair. It is. I advice that we were
> getting.
> > Mr. Ghislain Lebel: (Inaudible) not separatists elsewhere.
> > The Chair: I think that Mr. Harb's question was acceptable.
> > Go ahead, Mr. Harb.
> > Mr. Mac Harb: Thank you. Sometimes, you are very reasonable. Thank
> you.
> > Mr. Guité, I would like it for the record. I know this is going to,
> at some point in time, be made public. I think it's important for the
> record to speak about the circumstances under which you were operating at
> that time, in particular, in Quebec, because some of my colleagues are
> saying that why are we not spending money elsewhere in the country, why
> did we spend most of the money in Quebec.
> > Mr. Charles Guité: I don't know how to answer that question because
> I don't think the question is very clear. But I'll give you what I think
> you're looking for.
> > During the referendum, for example--and I guess it's in camera so
> it'll come out in three year, but that' fine--I, personally, with the
> funding we had through FPRO and the Government of Canada to fight the
> referendum, bought every billboard in Quebec and every outdoor advertising
> that was available. Okay? I blanketed...I phoned the guys in Montreal, the
> media people, and I said, > "> What's your inventory?> "> They said, > ">
> Oh, it's about $8-million worth of outdoor advertising that's available>
> "> . I said, > "> I'll buy it> "> . And the guy at the other end of the
> phone said, > "> Pardon me?> "> . I said, > "> I'll buy it> "> . That was
> a strategy that we then...I think the program at the time was Attractions
> Canada and there was something else with health. So we plastered the
> Province of Quebec with government ads that were legitimate government
> programs.
> > What was the strategy? The media was not available to anybody else
> but us. We had it blocked. Okay? Why did we do that? So that the separate
> movement in Quebec, or the Parti qu> ébécois, whatever, wouldn't have
> access to it.
> > I subsequently bought all the transit during the referendum. Not a
> bad strategy. I now... not I, but the Government of Canada, through my
> doings, have controlled the availability of the media available.
> > Was that wrong? I don't think so. I think it was the right move. I
> know the Auditor General is sitting on my right. It says sole-sourcing.
> The nature of the work is such that it would not be in the public interest
> to solicit bids.
> > * (1730)
> > The Chair: Is that your comment or the Auditor Generals?
> > Mr. Charles Guité: No, no, that's the directive the Auditor General
> has put in her report. And she's absolutely right, that's one of the
> conditions of sole-sourcing. Now, I may have looked at that at the time
> and decided there's a clause I can use. It's maybe bending the rules a
> bit, but it worked.
> > The Chair: Thank you, Mr. Harb.
> > Mr. Proulx, please, four minutes, s'il vous plaît.
> > Mr. Marcel Proulx (Hull-Aylmer, Lib.): Thank you, Mr. Chairman.
> >
> > Good day, Mr. Guité. You stated that you controlled virtually all
> decisions and all information within your office. At the time, how many
> person did you have on your staff, not Public Works employees per so, but
> staff in your office who handled sponsorships and contracts?
> >
> > Mr. Charles Guité: What period of time are you referring to, Mr.
> Proulx?
> >
> > Mr. Marcel Proulx: Well, the first of the Groupaction contracts was
> awarded after the 1995 referendum.
> >
> > Mr. Charles Guité: At the time, I had six staff members working on
> sponsorships.
> >
> > Mr. Marcel Proulx: On sponsorships?
> >
> > Mr. Charles Guité: And on advertising as well.
> >
> > Mr. Marcel Proulx: I see. When I> '> m trying to get at is this: you
> kept the information or the advice you received verbally to yourself,
> because as I understood it - and you can correct me if I> '> m wrong - not
> only was there no documentation in the files, as per your wishes, you did
> not share the advice you received either with other colleagues or with
> your staff. Correct?
> >
> > Mr. Charles Guité: That> '> s not so. I shared information with a
> number of persons within the organization.
> >
> > Mr. Marcel Proulx: I see. And what about decisions?
> >
> > Mr. Charles Guité: Moreover, I could give you names, because two of
> these persons are still working there, while the two others are not, but I
> know for a fact that they were involved in the process. When I received
> information, of course I shared it with my team.
> >
> > Mr. Marcel Proulx: I see. So then, you shared the information and
> decisions were made together?
> > Mr. Charles Guité: Yes, I did share the information that I got and
> the advice that I got.
> > Mr. Marcel Proulx: Okay. And the decisions were made in a think
> tank?
> > Mr. Charles Guité: Yes, quite often I would sit down with some of my
> key people and we'd look at them and say, > "> Look, it might be better to
> be present there because of that region of Quebec> "> . It was better to
> be présent au Lac Saint-Jean than in central Montreal.
> > Mr. Marcel Proulx: Yes, as a matter of fact, I think you probably
> thought it was better to be elsewhere than the Outaouais, but I didn't
> appreciate that at the time.
> > Anyway, Mr. Guité, when invoices came in, was it you and the same
> people who have made the decisions--
> > Mr. Charles Guité: When...excuse me?
> > Mr. Marcel Proulx: When invoices came in for the different
> sponsorships or the invoices from the agencies, was that examined and paid
> by the same people who had examined the suggestions?
> > Mr. Charles Guité: No, no. Normally, when I got an invoice on my
> desk for signature, they had the proper stamp on it and the work had been
> done. I was aware of most of those events, so I never, never questioned an
> invoice. By the time it had got to me, I knew it had gone through my
> administration, the people who were involved in the projects, who were
> responsible for the projects, and I signed the invoice.>
> > Once that invoice was signed, it went to the financial section of
> the department. They, again, have a process that says there is a contract
> in place, the value is not overspent, dada, dada, and they authorize
> payment to the agency. So there is a system in public works that does
> that.
> > Mr. Marcel Proulx: Therefore, you were confident that whatever
> decisions or whatever contracts you gave out, because it went through the
> meat grinder of your department, when it came back for payment, because it
> came back for payment, it had to be all right.
> > Mr. Charles Guité: The department could not pay an invoice without a
> contract. So if the invoice came in and there was no contract, you can't
> pay the invoice. Therefore, when I issued a contract, it went through the
> contract branch of our department. When I signed an invoice, it went
> through the financial branch and they matched the two. There's a contract,
> there's an invoice, it's authorized for payment, therefore, we issued a
> cheque.
> > * (1735)
> > Mr. Marcel Proulx: Okay, thank you.
> > We haven't much time, otherwise I'd ask you for some of the dirty
> tricks the Quebec government played on you. But we haven't enough time.
> > Thank you, Mr. Chair.
> > The Chair: Exactly four minutes, Mr. Proulx, so, no, you're out of
> time.
> > Mr. Marcel Proulx: I'm well aware.
> > The Chair: Mr. Guité, my first question to you is: at the beginning
> you claimed you could not answer any questions pertaining to discussions
> with the minister. Did you ask your minister for a release to allow you to
> divulge these conversations with us?
> > Mr. Charles Guité: No, I have not.
> > The Chair: You didn't ask him for a release. Okay.
> > Now, you were, using your terminology, > "> at war> "> , therefore,
> that allowed you to bend the rules--and I think Boisey's quotes are your
> quotes. You talked about under the Sponsorship Program there was a great
> amount of strategic advice that was given to you verbally. The strategic
> advice that was given to you had nothing to do with the Sponsorship
> Program. Am I correct?
> > Mr. Charles Guité: It had...?
> > The Chair: Nothing to do with the Sponsorship Program.
> > Mr. Charles Guité: Oh, definitely, it was directly related to the
> Sponsorship Program.
> > The Chair: What kind of strategic advice could you get? You did say
> that you bought up all the outdoor advertising and all the transit
> advertising.
> > Mr. Charles Guité: That example had nothing to do with the
> Sponsorship Program.
> > The Chair: So what kind of strategic advice were you getting?
> > Mr. Charles Guité: I'll repeat what I said earlier for the same
> question. I was getting the advice of what other organization was
> sponsoring that event; in other words, if the Government of Canada is
> going to be there at, let's say, $400,000 worth of sponsorship at Formula
> One in Montreal, what amount of money is the Quebec Government putting in,
> what amount of money is the Casino putting in, what amount of money is
> Hydro Quebec putting in, what amount of money is Molson putting in, what
> amount of money is Air Canada putting in. Based on the amount of money is
> the amount of visibility you can buy at those events. So if I arrived at
> the Formula One in Montreal and I said to the organizer of the event, > ">
> Look, I'll take a sponsorship for $100,000> "> , he may say, > "> Okay,
> you can have two word marks on the track and a bunch of flags in the
> stands, but if you give me $500,000, you can have a lot of word marks on
> the track and you can have them at very specific places where the TV
> camera will be monitoring the race> "> , and that's what you pay for.
> > The Chair: Yes, but surely if you were still using the terminology >
> "> at war> "> and you wanted to say > "> I want to be the most visible
> advertiser at a particular event> "> , this is no> t classified stuff,
> this isn't stuff that is going to save the country. Why is it all verbal
> and not written? It also seems to me this is hardly verbal information
> worth hundreds of thousands of dollars. Why would> it be worth hundreds
> of thousands of dollars and why couldn't something like that be written
> down?
> > Mr. Charles Guité: Because of the hours the agency spent looking at
> those events and advising me on all the events in Quebec and going out and
> finding out from the events organizers who's going to be there. In many
> cases, we were turned down. In certain sponsorships that we've approached,
> organizers of events, we were bluntly told, > "> Monsieur Gouvernement du
> Canada, you can keep your money, we don't want you here> "> .
> > The Chair: Well, your credibility is getting a little thin with me
> on these answers.
> > Let me ask you this question: did Groupaction or any of these other
> contracts that you had do any polling for you, as far as the separatist
> issue was concerned?
> > Mr. Charles Guité: No.
> > The Chair: There was no polling involved? It was strictly > "> and
> nothing but> "> advertising?
> > Mr. Charles Guité: Yes.
> > The Chair: Nothing else?
> > Mr. Charles Guité: No.
> > The Chair: And yet it had to be so secret that it had to be verbal.
> > Mr. Charles Guité: No, because we didn't want the information to get
> out.
> > The Chair: But my goodness, the government has tonnes of information
> they sit on, and, as Mr. Bryden, the access to Information hides a whole
> bunch more, and everything dealing with cabinet, and you're claiming
> cabinet confidentiality, in essence, because you're advising the minister.
> Everybody knows that's covered by confidentiality. Your credibility, I'm
> sorry to say, is getting a little bit thin.
> > Let me get back to this $8 million in advertising, where you said, >
> "> I just bought all the outdoor advertising in Quebec> "> .
> > Mr. Charles Guité: This--
> > The Chair: Let me ask you this question: did you tell the minister
> you had done this so that he could say, > "> Good job, Mr. Guité, you've
> frozen out the separatists> "> ?
> > Mr. Charles Guité: No.
> > The Chair: Did you advise the minister at all?
> > Mr. Charles Guité: No.
> > The Chair: Did you tell anybody in the cabinet at all?
> > Mr. Charles Guité: No.
> > The Chair: Was this a one-man crusade to save the country?
> > Mr. Charles Guité: No, no. No, no. The example you're referring to
> that I used, that was during the referendum when I was working with the
> Federal-Provincial Relations Office, my organization and the Privy Council
> Office on a strategy. It had nothing to do with the Sponsorship Program.
> That's an example I used based on his question earlier of, > "> What type
> of strategy were you using?> "> .
> > * (1740)
> > The Chair: How was this strategy paid for? Was it paid through these
> contracts?
> > Mr. Charles Guité: Which one, now?
> > The Chair: Well, you're talking about there's all this strategy.
> Strategy means you can implement a policy or a program or achieve an
> objective. That, of course, costs money. Was the Groupaction contract used
> to get that money to the people to implement the strategy that was
> approved by the Privy Council?
> > Mr. Charles Guité: No, no. Again, we're getting mixed up here on
> different periods of time and so forth.
> > During the 1995-1997 period, certainly the referendum...and, again,
> I forget the exact date. I can't remember when the Canada Information
> Office was created, but I think it was after the referendum. That's
> another organization I worked very closely with on sponsorship, again,
> because of the roles they had in promoting Government of Canada programs,
> which is now called, I think, Communication Canada. During the period I
> was there, it was CIO, Canada Information Office, and some of the advice I
> was getting from Groupaction was passed on to that organization also.
> > The Chair: But you told me the advice was strictly the amount of
> billboards that other people were--
> > Mr. Charles Guité: No, no. The billboards, forget that I ever--
> > > The Chair: Okay. So this was at a different period of time.
> Groupaction were doing some strategic information, giving it to you and
> you were passing it on to ministers?
> > Mr. Charles Guité: No, no, no. The billboard example was strictly
> trying to address--
> > The Chair: Okay, Mr. Harb's question.
> > Mr. Charles Guité: --Mr. Harb's question. It had nothing to do with
> sponsorship, it had nothing to do with Groupaction.
> > The Chair: Okay. So the strategic advice you were receiving, which
> you say was vitally important--
> > Mr. Charles Guité: Yes.
> > The Chair: --and worth a great deal of money, did you pass this
> information on to the ministers?
> > Mr. Charles Guité: No.
> > The Chair: They were kept in the dark?
> > Mr. Charles Guité: They weren't kept in the dark. They saw the
> results that were happening.
> > The Chair: They didn't ask questions?
> > Mr. Charles Guité: They were happy with the results. Again, I cannot
> comment because that would be disclosing discussions I've had with the
> minister's office. I go back to my opening comment. I cannot comment any
> further on that.
> > The Chair: Okay. It seems to me there's a disconnect between...well,
> it's very, very difficult for me to understand.
> > Now, Mr. Quail, you said, you kept in the loop and you were having
> regular meetings with him every week, a couple of time a week, every
> couple of weeks, and the same with the minister. Mr. Quail said--and it's
> on the record, and I think you've read the testimony--he relied on his
> subordinates to do the job. He was off managing his department. Because he
> was a big-time manager and DM, he didn't have time to see that everybody
> was doing their job, therefore, that's why things got out of hand, even
> though he's getting paid the salary of a DM to administer his department.
> > Now, you said you kept Mr. Quail in loop.
> > Mr. Charles Guité: Yes, I did. In fact, if you went back to some of
> the minutes of the department, I sat on the executive committee as a
> member. There were two or three committees I sat on as a senior public
> servant in the department that was chaired by Mr. Quail. During one of
> those committees we gave an update, a weekly update, of where we were with
> activities and so forth. I kept the deputy minister informed of what I was
> doing.
> > Now, did the deputy minister get details about what event and so
> forth and what happened at a certain event? My answer would be, no. Did he
> get a list of what events were taking place? Yes. And I wouldn't expect
> the deputy minister to go down to the details of how many word marks and
> sponsorship--
> > The Chair: Did you tell him you were bending all the rules and
> ignoring the rules?
> > Mr. Charles Guité: No, I did not bend all the rules.
> > The Chair: Well, you bent some of the rules.
> > Mr. Charles Guité: Yes, I did.
> > The Chair: Did you tell him you were bending rules?
> > Mr. Charles Guité: No.
> > The Chair: You didn't tell him that at all?
> > Mr. Charles Guité: No.
> > The Chair: You took it upon yourself?
> > Mr. Charles Guité: That's correct. I made the decision.
> > The Chair: You are familiar with the Financial Administration Act--
> > Mr. Charles Guité: Yes, very much.
> > The Chair: --and the Contracting Act and you, personally, decided
> that doesn't apply, we are at war, therefore--
> > Mr. Charles Guité: No, no, I didn't say it doesn't apply. It
> applied, except the rules were, for a better term, bent a bit. But total
> disregard for the rules, no, I don't buy that.
> > The Chair: Do you have a comment, Ms. Fraser?
> > Ms. Sheila Fraser: I think, Mr. Chairman, my reports speaks for
> itself.
> > The Chair: Yes.
> > Well, we have 15 minutes or 20 minutes left and we have one, two,
> three...five people wanting to speak, so we'll go three minutes each.
> > * (1745)
> > Mr. Mac Harb: > Mr. Chair?
> > The Chair: Mr. Harb.
> > Mr. Mac Harb: You indicated your intention to have a meeting at 6
> p.m. I would suggest that the meeting will have to end by 6 p.m. So if you
> wanted to have that future business--
> > The Chair: Why does it have to end at 6 p.m.?
> > Mr. Mac Harb: Because some of us will have to leave. We were here
> under the impression the meeting was from 4 p.m. to 6 p.m., so we're not
> going to be here past 6 p.m.
> > The Chair: Okay. We didn't indicate a closing time for the meeting,
> although they are normally two hours. It was my intention we'd actually
> have a separate meeting at 6.30 p.m., but I do note the clerk put future
> business on at the end of this meeting. Although I had intended the clerk
> issue a third meeting today at 6.30 p.m., but he hasn't. It's right on
> here, > "> Future Business> "> , item B, and, therefore, it is part of
> this meeting. We would have to suspend the meeting to allow the witnesses
> to leave. We normally have these meetings in public, not in camera, and
> we'd have to switch that over. My preference is we hear from the five.
> > How many people have planes to catch and have to leave? Two. Okay,
> so we can manage, I think. We can continue on.
> > Okay, we will have quorum.
> > Mr. Mac Harb: We're not going to proceed past 6 p.m., Mr. Chairman.
> > The Chair: I think we'll cut the questions off at 6 p.m. and then
> we'll run into the next meeting shortly thereafter. But, as I say, with
> only two people having to leave, I think we'll have lots of people for a