Trudeau and Morneau couldn’t have avoided being involved in WE deal, privy clerk tells MPs

Prime Minister Justin Trudeau and Finance Minister Bill Morneau could not have avoided being involved in the decision to give WE Charity a contract to administer a $912-million student volunteering program, according to the clerk of the Privy Council.

Ian Shugart, Canada’s top public servant, told the House of Commons finance committee Tuesday that he doesn’t see a way Trudeau and Morneau could have avoided taking part in cabinet discussions around the agreement with WE Charity given the “scope” of the program.

The now-cancelled deal could have paid the WE organization up to $43.5 million.

“I do not see a way that the prime minister or the finance minister responsible for public funds could not have had involvement in the policy development and in the approval of finances on this scale,” Shugart said.

Shugart also said he wasn’t aware of any financial connections between Morneau and WE Charity but that Trudeau’s “involvement” with WE  was well-known.

“It did not particularly cross my mind that there was anything that needed to be disclosed because this was a well-known fact,” he said.

Shugart also promised to release all communications between the Prime Minister’s Office and the finance minister’s office and their interactions with the public service related to the WE Charity contract. He also said he would release the contribution agreement between the federal government and WE Charity.

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The committee is investigating how the Trudeau government reached its decision to hand control over the $912-million Canada Student Service Grant Program to WE Charity, which would pay students up to $5,000 each for volunteer work.

WE Charity and the Trudeau government have been mired in controversy after it was revealed the charity had paid Trudeau’s mother and brother a combined $312,000 in speaking fees between 2016 and 2020 and that Morneau’s daughter is employed by the organization.

Since the Trudeau government was elected in 2015, WE charity has received roughly $5.5 million in funding from Ottawa.

Both Trudeau and Morneau have apologized for not recusing themselves from the decision and are now under investigation by Conflict of Interest and Ethics Commissioner Mario Dion.

Morneau is slated to appear before the finance committee on Wednesday.

Shugart also told the committee he wasn’t aware the public service had raised any red flags with WE Charity during talks to administer the student volunteer program.

“No financial flags were raised through this process about the WE Charity,” Shugart told MPs. “There were no detailed investigations of WE Charity’s financial affairs.”

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Last week, the committee heard from Diversity and Inclusion and Youth Minister Bardish Chagger, who revealed the government would have paid nearly $44 million to administer the massive program. The Trudeau government had previously said it would pay WE Charity $19.5 million for the contract.

A spokesperson for Chagger confirmed the minister met with WE Charity almost a week before the $912-million COVID-19 student volunteering program was announced. The phone call between Chagger and WE co-founder Craig Kielburger was first reported by the Toronto Star.

“Minister Chagger regularly meets with hundreds of organizations, in person or by telephone,” spokesperson Dani Keenan said in an email. “A phone call did take place on April 17 to talk about the (WE social entrepreneurship) proposal, however there was no further action taken.”

The testimony last week heard that hours after Trudeau announced the $912-million student volunteer program on April 22, Kielburger sent an unsolicited pitch to run the program to a senior civil servant at Employment and Social Development Canada (ESDC).

Rachel Wernick, senior assistant deputy minister at ESDC, told MPs last week that WE was the only organization that could launch a massive new program within a short time period.

“On April 22, WE Charity sent me a detailed proposal to quickly develop tens of thousands of volunteer placements for youth within a few weeks,” Wernick said.

“Given the need for speed and scale, I determined with my team and colleagues that their draft proposal was the best available option in the time we had to work with.”

WE Charity declined to answer questions from Global News about the payments from the Trudeau government.

“As representatives of WE Charity, Marc and Craig Kielburger are scheduled to appear before the Finance Committee hearing on July 28,” the charity said in an email. “As co-founders, they are eagerly anticipating the opportunity to set the record straight and clarify a number of matters, including those referenced in your questions.

“We will be withholding comment on those questions until after the committee meeting.”