Um, guys? This inquiry that has been the focal point of ITQ’s existence for the last two months? It’s about to be — over. I know. I’m not sure what I’m going to do with the rest of my life either.
Okay, in fairness, it’s not really over, per se. I mean, there’s still a report to be written, which requires conclusions to be arrived at, and the second phase of hearings, which will cover policy recommendations, and get underway in a couple of weeks — oh, and Schreiber still has to show up for a final round of cross-examination by commission counsel, and apparently, there’s also a slight possibility that one of the other parties will pop up today with a motion to subpoena more witnesses. But it’s still the very last day of public hearings according to the schedule, at least, so please excuse your liveblogger if she starts to get a bit maudlin towards the end.
As for today’s hearing, it’s a bit of a mixed bag, as far as the witness list goes: Salpie Stepanian from the PMO correspondence unit; another CRA official, who will testify about the voluntary disclosure program, and Fred Bilt, who was Canada’s Ambassador to China when Mulroney allegedly discussed his United Nations group buy concept with the Chinese leadership, but who was not, according to the former prime minister, actually present during the conversation.
Good morning, Oliphantophiles!
With just a few minutes to go until the last! public! hearing! ever! (okay, not really), we’re all aboggle over the revelation that the government is picking up the tab for Team Mulroney’s legal bills, to the tune of $2 million.
More precisely, we – we, the media, that is – are baffled and confused over the somewhat dubious decision not to get ahead of the story by releasing that tidbit weeks ago, rather than let the timebomb tick away until detonated by the Canadian Press the very same day that they’re doing damage control over how much their right honourable client paid — and didn’t pay — in taxes under the voluntary disclosure system.
We’re still not in session yet, but based on the nameplate, it would seem that the first witness to take the stand will be Salpie Stepanian, who hails from PMO correspondence. At one point, it looked like former special assistant Lannay Cardow would *also* be testifying, but his name doesn’t appear on the most recent list. There is much hopeful speculation that we may be done by noon, but you know, last time ITQ confidently predicted an early end to the day, we would up sitting til 5pm, so she’s not going to risk jinxing us today.
First order of business is the SchreiberHealthWatch; apparently, his lawyer has been in touch, and he has a medical appointment tomorrow, and – barring any new developments – his appearance has been adjourned until June 3, at which point his motion for an order requiring him to stay in Canada will also be heard.
Wolson then hands the floor over to Nancy Brooks, who will be handling the Stepanian interview, but who also has two new exhibits to table: An interview with Jean-Pierre Kingsley, and an interview with Jean Charest. Ooh. Those might actually be interesting — unfortunately, ITQ won’t be able to peruse them until the break. Brooks also files the full Canada Border Services Agency handwriting analysis report — you remember that one; it found no indication that the writing on the mandate letter was not, in fact, that of Karlheinz Schreiber, despite his claim that it was a “miracle” that it appeared there.
With that out of the way, the registrar swears in the witness, who is wearing a rather subdued deep mauvey-rose jacket, and looks only the tiniest bit nervous. She’s here to talk about how the correspondence from Schreiber to the *current* prime minister was handled, and she was here all day yesterday, waiting patiently to enlighten us all, so let’s pay attention, shall we?
Stepanian tells the commission that she has been the manager of the PMO correspondence unit for three years – she was on the job when the Schreibergrams started to arrive.
According to Stepanian, there are approximately six people working in PMO correspondence – editors and writers – which handles personal and political mail — that related to party or caucus matters, as well as the prime minister’s role as a Member of Parliament, and issues in which he has a “personal interest” (ie hockey). When something comes up that PMO wants to handle, that is conveyed to PCO by PMO correspondence, and – wait, didn’t we already hear all about this, in excruciating thorough detail, from the last correspondence-related witnesses?
In any case, we get a refresher course on handling mail, and WebCIMS. There were 37,000 items of mail handled in 2007, but Stepanian notes that the number also encompasses mail passed on from ministers’ offices. She seems uncertain about Brooks’ suggestion that such a vast volume of mail means that most gets just a cursory scan, what with imagining the ensuing headline (which she probably shouldn’t worry too much about, given the skeleton crew of reporters in the room at the moment), but Brooks points out that the witnesses from PCO correspondence confirmed that this was the case.
Finally, we’ve gotten to the Schreibermail — four pieces thereof, to be exact — that was forwarded from PCO to PMO, starting on June 16, 2006. When that first letter arrived, Stepanian recalls, “we recognized the name”, so it was forwarded to a senior staffer – the executive assistant to the chief of staff, in fact, which – if memory serves – would have been Lannay Cardow, who instructed the office to file it without response. Two subsequent letters got the same treatment, and Stepanian notes that she filed the fourth one herself, without being told to so, based on past practices.
And – hey, turns out that’s it for Salpie Stepanian; the judge dismisses her, noting that the volume of correspondence requires her presence back at PMO, and jokingly asks that she make sure *his* letters get through; Pratte, meanwhile, wonders if this is why his correspondence *doesn’t* — oh, ITQ is sure that isn’t the case — and after a bit of jocularity, we adjourn for fifteen minutes. Next up: Tax law! Again! In French! Hey, where are y’all going? This is fascinating stuff!
So, not surprisingly, there was a mad dash to the media room to see the new exhibits – the interviews with Kingsley and Charest, in particular. Unfortunately, they’ve not yet been photocopied, but we’ve put in a frantic request to the commission, so they should be available by the time we break for lunch.
And – wow, that was efficient: As I was typing that last paragraph, the crack commission communications cadre was hard at work over the photocopier, because we now have copies of the Kingsley interview, or at least a summary thereof. So far, he seems to be backing up Mulroney’s position that he wasn’t involved in negotiating the waiver, although he does state that Doucet called him to discuss it — I believe that was one of the many events related to this case that witness couldn’t recall, but please feel free to correct me if I’m wrong.
Anyway, “in accordance with his usual approach”, Kingsley “did not inquire into whether there were specific files or matters that would raise concerns.” Ahh, those were the days.
Really, why did they even *bother* having a conflict of interest code if that was the standard practice for granting waivers? I mean, Kingsley apparently negotiated “some 60 agreements” — termination agreements, I gather — on behalf of the government. How many other cooling-off period freebies did he hand out? Not that I’m blaming *Kingsley* — I mean, this was the system. He was a civil servant; it would have been up to the politicians to change the rules.
Alright, we’re back, and Battista is questioning Christiane Sauve, an official with Canada Revenue Agency’s voluntary disclosure program. She gives her background – she’s a CGA, and has been with the government for several years – and explains the benefits of the program — it allows taxpayers to avoid penalties, and gives the government an opportunity to get money it wouldn’t otherwise have received, through the taxes that are paid on money that wouldn’t have otherwise been reported. It also “reintegrates” the taxpayer into the system.
Battista wonders how a taxpayer registers for the program – by phone, letter or in person, as an individual, or through an authorized representative; most files are opened anonymously, Sauve tells him. This launches a discussion, and then a negotiation, and finally, the identification of the individual, and the filing of amended returns.
There are three criteria that apply – it has to be voluntary, verifiable, and the tax has to be paid. Wait — “verifiable”?
Anyway, as per Sauve, “voluntary” means that the taxpayer is not under investigation – criminal or otherwise – or subject to any government measure; in Quebec, that would mean the provincial government as well.
Ooh! I’ve just been handed my very own copy of the Charest interview — thanks, crack commission communications cadre! — so if it’s okay with y’all, I’m going to flip through it while listening to Sauve’s testimony. I promise not to miss any critical points. She’s just finished up with her explanation of the eligibility requirements, as listed above,
Also, as per his interview with the commission, Charest has “no recollection” of meeting with Schreiber, or “having dealt with the project”; the project, of course, being Bear Head.
Sauve, meanwhile, explains why the total amount on which a VDA claimant might pay tax could have been reduced by up to fifty percent — in 2000, that is; apparently, the procedure has changed.
She notes that sometimes, not all the income is taxable – it may involve money received as a gift, or declarable expenses, that sort of thing. After the amount had been agreed to by both the CRA and the taxpayer, the agency requested amended forms, and the tax would be paid. Battista wonders why the process used to work that way, and Sauve tells him that at the time, there were no discretionary powers to negotiate interest, which led to amounts owing that were so high as to be punitive, and taxpayers would frequently withdraw from the program. That has subsequently changed, Sauve says — the interest is now negotiable. It is also the *real* income that has to be taxed, and – oh, the 50 percent deal is no longer available either. He
And – that’s it for Battista. Does anyone else have any questions? Pratte may — he needs a five minute break to confer with his client, apparently — but this sparks a memory jolt for Battista, who returns to the lectern to ask what the difference is between an involuntary omission — an “oopsie, I forgot to declare a whole pile of cash” mistake — and an ordinary tax return, which – as per Sauve – always has to be filed.
So the fifty percent tax discount is no longer available — sorry about that, y’all.
Five minute break, and then Guy Pratte on taxes, and finally — Fred Bilt!
Charest Interview Speedreading Update:
(Pretend these are bullet points — I forget the exact html code and don’t want to break the entire site by making a guess.)
-He remembers almost nothing of the meetings he apparently attended on the Bear Head project
-He and Fred Doucet were acquaintences — peripheral acquaintences, you might say — but didn’t have the sort of relationship where he’d pick up the ministerial phone if Fred was on the line; he would mostly have dealt with Charest’s staff
-He does recall that there were some — problems with the Thyssen proposal — the lack of a business plan, the fact that General Motors made similar vehicles, that sort of thing, and that his department – Industry at the time – did not eventually support the proposal.
-By June 1993, he was “heavily involved” in the PC leadership race, and he wasn’t having a lot of meetings on “any substantial issues”
And now, Fred Bilt! For some reason, I’ve been really looking forward to this witness — well, compared to the adventures in tax law. Oh, and in case you wondered, none of the other lawyers had questions for Sauve, so she has been excused, although she may have to run a mini-gauntlet of media seeking a bit more clarification on when the fifty percent discount program ended, and, more importantly, why.
Anyway, Bilt – who seems delighted to be here – gives a brief recap of his career, which involved all sorts of thrilling postings in glamourous locales, including Thailand and Vietnam, which, Roitenberg – for yes, it is he who is handling the questions for the commission – notes was a period of time “close to his heart”. Why? Because it coincided with the crisis of the “boat people” – exiled Chinese citizens who were cast adrift, literally, in ill-equipped ships. This, Bilt recalls, was during what turned out to be the brief tenure as prime minister of Joe Clark, and Canada – which was apparently back even back then – stood up to take in 50,000 of these refugees, which forced the rest of the world to humanitarian-up, and the rest was history — the kind of history of which Canadians should be proud, even today, according to Bilt. *His* job was to coordinate the immigration process, as well as negotiate the exodus with the Vietnamese government.
Aw, I’m glad Roitenberg gave him the chance to tell that story, even if it wasn’t *strictly* relevant.
After heading home to Ottawa, Bilt took up a senior post at Foreign Affairs, where he organized summits — hey, wasn’t that what Doucet was supposed to be doing when *he* was an ambassador at large? — and took part in the successful campaign to win a seat for Canada on the UN security council, and in 1990, he was appointed Ambassador to China.
Roitenberg notes that, based on his — Bilt’s — experience, he can confirm that the United Nations security council never considered buying military equipment, although there was no rule or protocol that forbade it; Bilt agrees that this was the case, and notes that, in 1994, the UN did set up a peacekeeping-centric military base in Bruni – warning, spelling alert – which was a place to *store* equipment, quite a bit of which the world body had “inherited” over the years. It was also good for giving poorer nations a training ground for peacekeeping.
So there. Maybe Mulroney’s idea *wasn’t* so crazy.
And now — the China trip, which Bilt recalls well; he had a chat with Mulroney before he left Canada, and participated in many of the ensuing events.
And – oh, it’s Vickery, popping up with an observation; he is acting for Bilt at this hearing, he notes, and was concerned over whether he is allowed to identify the members of Mulroney’s delegation, which were redacted from the documents filed by the former prime minister. Pratte would prefer to keep the identities anonymous. Olihant wonders if that’s the case “even though we’re talking about something that happened eighteen or nineteen years ago?” but eventually agrees that it’s not really relevant to the commission, so the identities of Mulroney’s other two clients will remain secret. (We do know one of them had something to do with hydroelectric power!)
In response to a question from Roitenberg, Bilt says that Mulroney did not give him specifics on what he would be discussing, but he definitely didn’t mention military equipment, peacekeeping or otherwise — it would, according to Bilt, have sent up a big red flag at the embassy, and changed the nature of the trip entirely.
Roitenberg begins to go through Mulroney’s agenda from the China trip, starting with a “possible” breakfast with Bilt, which he — Bilt — doubts actually took place, since he doesn’t remember it. That’s refreshing — a witness who doesn’t leave everything open to be rebutted by subsequent evidence.
He does recall a meeting with a Chinese official that he had actually helped to arrange, as well as one with an official in charge of electric power — oh, and at the banquet, which was given at the Great Hall of the People.
He did not attend the first meeting of the *next* day, although he knew one of the invitees well, as he was a former Chinese ambassador to Canada, but he did make it to the lunch meeting, and at *another* banquet that night, which was hosted by the leader of the delegation, and — wait, actually, couldn’t some of those people — the mystery representatives of the unnamed clients — actually confirm whether the Bear Head project came up during meetings with Mulroney and those members of the Chinese leadership he claims to have buttonholed? That would make them at least a *little* relevant.
Just as we’re getting into Bilt’s notes from Mulroney’s 1994 trip to China, something prompts Oliphant to check to make sure that there are no concerns about redactions to this particular document, thereby making ITQ wildly curious to check out the exhibit binder to find out what caught his attention.
Oh, a story! I love stories. Anyway, there’s one thing that Bilt recalls from the 1993 trip — since Mulroney and his delegation were flying in on a private jet, the embassy was supposed to get clearance, but two days before he was scheduled to arrive, it turned out that the embassy official who was supposed to get that clearance hadn’t done so, and – oh, it was a big mess, but apparently, it all ended well.
Anyway, once again, Bilt makes it clear that if Mulroney had even mentioned the possibility that he would be discussing military procurement, it would have put the embassy on high alert — it would have required Bilt to check with his political section, and assign one of his officials to follow that aspect of the trip — “a whole new phase opening up in our relationship with China”, basically, even if the possibility of procurement wasn’t explicitly stated.
No, there was no *law* requiring a private citizen to give the embassy notice, but ultimately, the government of the day would have to get involved — even if it was in the context of the United Nations.
Roitenberg can’t quite get how a “private citizen” simply “broaching the topic” would be the catalyst for such a response, and Bilt reminds him that this was a private citizen who was also a former prime minister; this isn’t something that he would just do as a doddle. He would have consulted with Foreign Affairs — “the people next door”, as Bilt puts it — to find out how China would react. “Everyone was extremely careful,” he recalls — and the Chinese would have reacted as well, and would have been instantly in touch with the embassy.
Okay, I think it’s safe to say that so far, Bilt’s testimony is not exactly backing up Mulroney’s claim to have brought the Bear Head project up with the Chinese leadership.
“The Chinese, just as we knew, would realize that this would involve governments,” Bilt tells Roitenberg — and the more vague it was, the more questions they would have had.
Onto October 5, 1993 – a meeting at which Bilt was present, he confirms, and at which he remembers nothing being discussed about light-armoured vehicles. On the plus side, the Chinese official who was at the same meeting is still alive! Although, Bilt notes, he’s probably retired.
A Chinese banquet is not a “jovial dinner” where people “hang around and have a good time,” Bilt notes. There weren’t more than thirty or forty people there, and while he didn’t hear every single conversation going on, he didn’t pick up on any serious discussions — although he does remember Mulroney “going on at length” about certain appointments he had made, and oh, I bet *that* was a corker, but Bilt gives no further details, since it isn’t really relevant to the matter at hand.
Roitenberg wonders if there was a meeting that preceded the banquet, and he does not — although he notes that there is a pre-dinner chat between the guests, but it isn’t as informal as it sounds — you sit down, for one thing, and if business is discussed, it can be heard by everyone else in the room.
That’s all for Roitenberg, but Oliphant wants to be sure that he understood Bilt correctly: If Mulroney had brought up military sales, the Chinese officials would have been in touch with the embassy? Yes, most likely, Bilt confirms – I mean, he can’t be absolutely sure, but based on his time there, he would have expected it to come back, whereupon the red flags would have gone up.
Pratte has a few questions for Bilt, as it turns out — he wonders about the meeting with Juranjee — yes, that is *hideously* misspelled; I’m sorry, I just don’t have the document with the correct version handy — and Bilt kinda sorta suggests that Mulroney may have taken a little more credit than deserved for arranging that meeting, although he does confirm that it took place, and was a big deal.
Pratte wonders if there was any rule that would have required Juranjee to disclose a conversation about military purchases, if Mulroney had asked him to keep it private, and Bilt reminds him that Juranjee was an “old party member” – Communist Party, that is – and yes, there *would* be notes made of the meeting. “There’s no such thing as private when you’re talking to a vice-premier,” he reminds Pratte, who seems to be sorry that he opened up *that* line of questioning, and decides to quit — possibly while he’s ahead.
Auger also has a few things to ask Bilt, it turns out, and he begins with a quote from Bilt that appeared in the Globe and Mail, in which he apparently stated that he “would have got wind of” any discussions of military sales. He also told the Globe that there was no record of him telling the embassy anything about putting forward such a prospect. Bilt confirms that the quotes are accurate — “certainly” — and that he stands by that position.
Auger finishes up – mostly just getting Bilt to restate his position, which is that any such discussions would have gotten back to the Embassy.
And – that’s it for the day, and, as per Wolson, very nearly the end of the public portion of phase one, which – as noted earlier – will resume again on June 3, as well as final submissions by counsel on June 10 and 11th. Closing arguments? Possibly! Oh, that will be fun.
Yes, I’ll be back — provided my bosses continue to indulge me in this obsession, of course, and the government isn’t in imminent danger of falling.
And with that, the judge adjourns for the day — he’ll see us all back here on June 3. So really, this isn’t so much a goodbye as an adieu, right?
That’s all for ITQ for the moment — I’ll dig through the rest of the Charest transcript, of course, and report back on what I find, but as far as the liveblogging goes, we’re adjourned until June 3.