LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL Introduction

Prime Minister ’s brief its awarding of government contracts to Focus honeymoon with ’s voters came Groupaction. In 2003, a Liberal activist This CBC News in to an abrupt halt on February 10, 2004, in warned Paul Martin, then a Review story exam- ines the sponsor- with the release of the report of Sheila backbench MP, that taxpayers’ dollars ship scandal that Fraser, the federal Auditor-General. were being diverted from the sponsor- rocked Ottawa in Fraser’s devastating audit of how ship program for politically partisan the wake of the Ottawa spends taxpayers’ dollars con- purposes in that province, and strongly Auditor-General’s tained sensational revelations about a suggested he investigate the affair. February 2004 controversial government advertising Fraser’s report not only detailed report. We look at its main details and and sponsorship program that the Public where and how the money had been players, and the Works Department ran in the 1990s. misused, but also named names. A potential implica- The program, which Prime Minister number of senior civil servants and tions for Paul Jean Chrétien’s government had estab- politicians were implicated, including Martin’s Liberal lished after the narrow federalist victory former public works minister Alfonso government on the eve of an antici- in the Quebec sovereignty referendum Gagliano and Jean Pelletier, chairman pated federal of 1995, was designed to promote of Via Rail. Gagliano, who had been election. Canada in that province and showcase appointed ambassador to Denmark after the benefits of federalism. But whatever leaving politics, was removed from that the intentions of the federal sponsorship position a day after the release of the Did you know . . . program were, Fraser’s report uncov- Fraser report. He was later called before The 1995 Quebec ered outrageous misuses of public funds a parliamentary committee convened to referendum results in its day-to-day operations. She found inquire into the scandal, where he were so close that that at least $100-million had been strongly denied any wrongdoing. An if only 50 000 more voters had sup- handed over to public relations and enraged and clearly rattled Paul Martin ported the referen- communications agencies in Quebec announced on March 1 that Pelletier dum, it would have with close ties to the Liberal Party. had also been fired as a result of his been won by Much of this money was never actually involvement in the misuse of public separatist forces? used for the purposes originally in- funds while managing Canada’s main This narrow victory is at the basis of tended for it; instead, it had given these rail network. the sponsorship firms large commissions, with very For the Martin government, the scandal. little in the way of concrete results to sponsorship scandal could not have show for it. come at a worse time. A federal elec- YV Allegations about questionable finan- tion was widely expected for spring Sections cial dealings and abuses of public 2004, and the sensational allegations marked with this symbol indicate money in the sponsorship program were arising from the Auditor-General’s content suitable for not new. In fact, in 2002, Fraser had report had caused the party to lose younger viewers. called for an RCMP investigation into considerable ground in public opinion how one advertising agency, polls. The opposition Conservatives, Groupaction Inc., had been the recipient fresh from their founding party conven- of $1.6-million in government con- tion that named Stephen Harper as their tracts. At that time, she charged the new leader, and the rejuvenated NDP Public Works Department with “break- under Jack Layton both smelled blood. ing just about every rule in the book” in Throughout Canada, there was a grow-

CBC News in Review • April 2004 • Page 6 ing wave of public anger and disgust 2004 that the Liberals were in serious Quote over the taint of corruption and arro- trouble with the voters. It remained to “I am personally gance enveloping the Liberal govern- be seen whether Martin would proceed and profoundly committed to rapid ment. Despite Martin’s assurances that with his plan to go to the polls before and permanent the entire affair had occurred prior to June or delay the election call in the changes in the way his assuming the party leadership, and hope that public outrage over the spon- things are done in his promises to do whatever was neces- sorship scandal would diminish over Ottawa.” — Prime sary to get to the truth and punish those time. Minister Paul responsible, it was clear by early April Martin, Toronto Star, March 18, 2004 To Consider 1. In your own words, explain the sponsorship scandal. Why is it such a major political problem for Paul Martin’s government?

2. How has Martin responded to the scandal?

3. Do you think his actions will be enough to convince Canadian voters that his government deserves another term in office?

4. What was the original intention of the federal sponsorship scandal? Despite the evident misuse of public money in its operations, do you think it was a worthwhile government program nonetheless?

5. What advice would you give Paul Martin concerning the calling of the next federal election?

CBC News in Review • April 2004 • Page 7 LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL YV Video Review

1. How has the sponsorship scandal affected Paul Martin’s electoral future? View the video and respond to the questions on this sheet. Be sure to 2. What was the conclusion of Auditor-General Sheila Fraser to the investiga- take them up later tion? either with your peers or your teacher.

3. What event was the seed of the sponsorship scandal? Quote “Just pay the bill 4. How did some Quebec-based communications companies profit from . . . don’t ask sponsorship programs? questions.” — Huguette Tremblay commenting on the attitude in the Public Works Department, 5. How much money has been lost or wasted in the sponsorship scandal? Toronto Star, March 26, 2004 6. Why is Prime Minister Paul Martin in the political hot seat over the scan- dal?

7. What role did Alfonso Gagliano apparently play in the scandal?

8. What questions about the sponsorship scandal remain to be answered?

9. What impact do you think the scandal will have on the next federal election?

CBC News in Review • April 2004 • Page 8 LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL Great Canadian Scandals of the Past

Like most countries, Canada has had within 10 years. Macdonald faced a more than a few political scandals in its difficult election campaign in 1872, history. But rarely have they been with his support slumping dangerously serious enough to topple the sitting in Ontario. He desperately needed government or force the removal of a major financial contributions to ensure major political leader. In the United that his Conservatives were re-elected. States, the Watergate scandal of the He turned for help to an old friend, Sir early 1970s led to the resignation of Hugh Allen, a Montreal shipping mag- President Richard Nixon, while the nate and president of the Canadian salacious sexual improprieties that Pacific Railway Company, a firm engulfed President Bill Clinton resulted bidding for the contract to construct the in his near-impeachment in 1999. transcontinental railway. Allen donated Canada’s political scandals of the past approximately one-third of a million have often been colourful and seized dollars to Macdonald’s campaign, a the attention of the media and the public substantial sum for the time, in return while they lasted. But for the most part for the guarantee that his company their long-term consequences have not would be awarded the railway contract. been too serious for the parties and The Conservatives just barely won, leaders caught up in them. It remains to and their majority in the House of be seen if the current federal sponsor- Commons was drastically reduced. ship scandal will follow this pattern in Bowing to nationalist opinion, Canadian history or become so serious Macdonald demanded that Allen’s that it will lead to the downfall of the company divest itself of U.S. control current Liberal government of Paul over its board of directors. But he did Martin. not know that Allen had actually drawn Here is a brief survey of some of this on U.S. funds as part of his contribution country’s main scandals, their major to the Conservative campaign. In the players and issues, and their short- and spring of 1873, the Liberal opposition, long-term political impacts. led by Alexander Mackenzie, broke the scandal to the public. Pro-Liberal 1. The Pacific Scandal (1872-74) newspapers published damning letters Canada was less than a decade old and telegrams exchanged between when it was rocked by its first big Macdonald and Allen. In one of them, political scandal, involving the Conser- Macdonald pleaded with Allen, “I must vative government of Sir John A. have another ten thousand at once! Do Macdonald, one of the fathers of Con- not fail me!” That fall, Parliament federation. A major objective of reconvened, with six new MPs from Macdonald’s was the building of a Prince Edward Island, which had joined railway linking the new country from Confederation that year. These new coast to coast. In 1871, British Colum- members quickly allied themselves with bia had entered Confederation with the the Liberals, and Macdonald’s govern- promise that the railway joining it to the ment fell on a motion of non-confi- rest of the country would be completed dence. Mackenzie’s new administration

CBC News in Review • April 2004 • Page 9 quickly called an election for February Department, which controlled levies on Definition 1874, which they won handily, using goods moving between Canada and Motion of non- the Pacific Scandal to disgrace other countries, were mainly Liberal confidence is a motion designed to Macdonald and his Conservatives. Party appointees, especially from test whether a With his party’s stunning defeat at the Quebec. It was alleged that they had legislature supports polls, and tainted by scandal, been receiving large paybacks from the existing gov- Macdonald’s political career appeared “rum runners,” who were illegally ernment. In Cana- to be in ruins. Yet only five years later, exporting liquor into the United States, dian parliamentary in 1879, he was to regain the position of where prohibition was still the law. tradition, if a government loses a prime minister, leading the Conserva- Harry S. Stevens, a rising young Con- motion of non- tives to victory with an ambitious new servative MP, broke the scandal in the confidence, it program of economic development he House of Commons, and demanded should resign called the “National Policy.” A major King’s resignation. The Progressives immediately. plank in that platform was the comple- championed family values, including tion of the CPR, a task the Liberals had abstaining from alcohol, and as a result not proven themselves able or willing to of the Customs Scandal, their support accomplish during their term in office. for King was in serious jeopardy. In 1885, a triumphant Macdonald However, instead of resigning, King rejoiced when the last spike in the paid a visit to the Governor-General, transcontinental railway was driven into Lord Byng of Vimy. He requested that the line. By then, the Pacific Scandal of Parliament be dissolved and a new 1873 was long behind him, and he election be called. Byng refused, on the continued to serve as Canada’s first grounds that since Meighen’s Conser- post-Confederation prime minister until vatives had the most seats in the House his death in 1891. To this day, the name of Commons, they should therefore be of Sir John A. Macdonald is familiar to given the chance to form a government. practically every Canadian, while his King was furious at what he claimed old rival Alexander Mackenzie has been was the unwillingness of a colonial relegated to the dustbin of history. official to accede to the request of the democratically elected leader of the 2. The Customs Scandal of 1925 country. He resigned, but Meighen’s The federal election of 1925 resulted in government only lasted a few days the second consecutive minority gov- before falling to a motion of non- ernment in Canada’s history. Prime confidence orchestrated by King’s Minister Mackenzie King was deter- Liberals and supported by the mined to hold on to power, even though Progressives. found them- his Liberals had actually won fewer selves back at the polls for the second seats than his rival Arthur Meighen’s time in less than a year. Conservatives. The western-based In the 1926 election campaign, King Progressive Party, which had come in successfully diverted public attention third, held the balance of power, and away from the Customs Scandal and his King was convinced that he could count government’s involvement in it. In- on their support and continue in govern- stead, he harped on the issue of who ment. But soon after Parliament recon- should really make the important politi- vened, a serious scandal erupted, impli- cal decisions for Canadians—the cating the Liberals in financial miscon- elected prime minister or a British duct. The directors of the Customs colonial official. The “King-Byng

CBC News in Review • April 2004 • Page 10 affair,” as it is known in the history Montreal, where she began her liaison Further Research books, resulted in a major political with Sévigny, an affair believed to have Visit the CBC victory for King’s Liberals, who re- lasted from 1958 to 1961. Acting on Digital Archives at www.cbc.ca/ gained their majority in Parliament. As information provided by U.S. intelli- archives and view for Lord Byng, he soon found himself gence, the RCMP advised the then the audiovisual file, returning to Britain, while the Customs justice minister in Diefenbaker’s gov- Politics, Sex and Scandal, which had touched off the ernment, , that Sévigny Gerda Munsinger. whole political crisis in the first place, was involved with a woman who was was quickly forgotten. With the single believed to be both a prostitute and an interruption of 1930-35, Mackenzie East German spy. Fulton in turn in- Quote “I knew Pierre as a King would lead Canada until his formed Diefenbaker. He reprimanded man. He knew me retirement in 1948, thereby becoming Sévigny and demanded he end the as a woman. That’s the country’s longest-serving prime affair, but allowed him to remain in the all there was to it.” minister. cabinet. — Gerda Munsinger, Liberal Justice Minister Lucien quoted in The 3. The Gerda Munsinger Affair Cardin broke the scandal (such as it Distemper of Our Times, Peter Unlike the United States and Britain, was) in the House of Commons on May Newman, 1968 Canada has had very few political 4, 1966. The Liberals were frustrated scandals involving sex, , or a and angry at Conservative allegations of combination of the two. But in 1966 a security leaks and hoped to score points former Conservative minister of de- against the opposition by raising the fence in John G. Diefenbaker’s govern- Munsinger affair. By this time, Sévigny ment, Pierre Sévigny, was alleged to was no longer in politics, and Gerda have had a relationship with a German Munsinger was eking out a modest woman named Gerda Munsinger. What living in Montreal. The media attention made the matter more than just a simple and negative publicity forced her to sexual impropriety on Sévigny’s part return to Germany and seek anonymity. was the claim that Munsinger was A parliamentary inquiry found that supposed to be working as a spy for Sévigny had certainly conducted an ’s communist regime. illicit affair with Munsinger, who was a When the scandal broke, Diefenbaker prostitute. But there was never any was the leader of the opposition, and his evidence that she had worked as a spy, Conservatives were pressing hard to or that Sévigny had compromised return to power after two consecutive national security during his relationship election defeats at the hands of their with her. Liberal rivals under Lester B. Pearson. The Munsinger affair is understand- Pearson was heading a minority govern- able only in the context of the ment, and was barely hanging on to mentality and anti-communist hysteria power, dependent on the support of two of the time. Only a few years before, a smaller parties, the Créditistes and the British cabinet minister, John Profumo, NDP. had been forced to resign after it was Gerda Munsinger had worked at a revealed that he had lied about his affair U.S. army base near her hometown in with a prostitute whose clients also Bavaria, where she won a local beauty included a Soviet military attaché in contest, and she had ambitions to London. And then, as now, U.S. intelli- pursue a career in modelling. She later gence was concerned about security emigrated to Canada, and settled in risks in Canada and the laxity of this

CBC News in Review • April 2004 • Page 11 country’s government in dealing with War veteran and distinguished public Definition them. The scandal had no serious figure. When he died at the age of 87 in Cold War refers to political impact inside Canada except March 2004 the headline in his newspa- the period from 1945 to1990 when for the disgrace it brought on Pierre per obituary read, “A life defined by the U.S. and Sévigny, a decorated Second World scandal.” U.S.S.R. were engaged in a struggle for global Activities supremacy. Canada 1. Form groups to read and discuss the examples of scandal presented above. was located be- For each of the political scandals in Canada’s history, identify and explain: tween the two a) the main issues, b) the main players, c) its immediate consequences, d) duelling superpow- ers and was a solid its place in Canada’s history, and e) any parallels you may notice with the ally of the U.S. The sponsorship scandal or other relevant events today. years were noted for their great fear 2. What lessons do you think can be drawn about Canadian politics, and and tension. voters’ tolerance for scandals involving public figures, from reading about these political scandals?

3. In your opinion, can scandals be eradicated or are they an unavoidable and continuing part of public life? Notes

CBC News in Review • April 2004 • Page 12 LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL Myriam Bédard: Whistle Blower or Wild Card?

When Myriam Bédard, a former Olym- economize by dealing directly with Quote pic gold-medal-winning athlete, ap- printing and graphics companies, but “The allegation is peared before the parliamentary com- had been told that all contracts had to totally unfounded and made without mittee investigating the sponsorship be funnelled through Groupaction, at a . . . an iota of scandal in March 2004, the allegations significantly higher cost. truth.” — she made were astounding. She claimed When she left VIA Rail, Bédard Groupaction presi- that in 2002 she had been fired from her received praise as a “whistle-blower,” dent, Jean Brault public relations job at VIA Rail after or a person with the courage and de- responding to raising her concerns about its financial cency to denounce questionable or Bédard’s charges of drug dealing, dealings with Groupaction, a Montreal illegal activities taking place within the Toronto Star, advertising firm that had received large firm employing her. She was admired March 25, 2004 sums of money from the federal gov- for her principles, and her reputation as ernment through the sponsorship pro- an Olympic athlete only bolstered her gram. At the time, she was told that reputation for honesty and integrity. But Jean Pelletier, who was then VIA’s the sheer audacity of her claims, for chairman, wanted her to leave the which she was able to provide no solid company and go to work for evidence, later led some to question her Groupaction. Later calling her a “pitiful charges, and even her motives. Liberal single woman,” Pelletier had hoped to members on the committee warned of a discredit any damaging allegations she “witch hunt,” and pointed out that might plan to raise about VIA’s links although she was protected by parlia- with Groupaction in advance. After mentary immunity while testifying Pelletier’s remarks were made public, before the committee, the claims she he was fired from his position at VIA, made could be otherwise be considered becoming, along with former ambassa- grounds for libel. Bédard’s image was dor Alfonso Gagliano, a casualty of the not helped by her boast that it was her scandal. partner, a Montreal artist, who had Bédard’s testimony before the public single-handedly persuaded former accounts committee contained some prime minister Jean Chretien to stay out truly remarkable charges that, if true, of the U.S. war in Iraq as a result of a would make the sponsorship scandal conversation with him at a reception at even more sensational and serious. 24 Sussex Drive. Among other things, she claimed that Is Myriam Bédard a whistle-blower the sponsorship program had paid or a wild card? In an interview broad- famous Quebec racing car driver cast on the CBC national news shortly Jacques Villeneuve US$12-million to after her appearance before the commit- wear the maple leaf logo on his racing tee, she defiantly stuck to her charges, suit, as a means of boosting the federal- while offering no further proof of their ist cause. She also stated that veracity. Many questions continue to Groupaction, the main recipient of surround her testimony, among them sponsorship funds, was involved in the following: Are her allegations really drug trafficking. While employed at true? If so, what consequences could VIA, she said that she had tried to follow from them? If they are not, then

CBC News in Review • April 2004 • Page 13 what are her motives for making them? government, or will it be able deflect Will her sensational charges make the public attention from it by calling her scandal even worse for the Liberal credibility into question? To Consider 1. Do you think Myriam Bédard is telling the truth? How do you think her allegations will impact on the sponsorship scandal, a) if they are proven true, or b) if they are found to be false?

2. Why are whistle-blowers valuable and important in issues like the sponsor- ship scandal? Describe any other recent scandals involving questionable activities on the part of either governments or corporations, in Canada or other countries, where whistle-blowers helped bring important informa- tion to the public’s attention.

CBC News in Review • April 2004 • Page 14 LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL The Auditor-General and Her Report

A Profile of the Auditor-General of her February 2004 report. Although Further Research Sheila Fraser, the federal Auditor- she stated at the outset that she found To learn more General, was appointed in 2001. Since the actions of the Public Works Depart- about the Auditor- General, her re- taking the job of watchdog of govern- ment so shocking that “words escape ports, and the ment financial activities, she has re- me,” she continued to charge that, department itself, leased a series of reports documenting “From 1997 to 2001, the federal gov- visit www.oag- excessive spending and the misuse and ernment ran the sponsorship program in bvg,gc.ca. waste of public funds. While the details a way that showed little regard for of her reports are damning in and of Parliament, the Financial Administra- themselves, her plainspoken, matter-of- tion Act, contracting rules and regula- fact delivery of them to packed parlia- tions, transparency, and the value of mentary press conferences only in- money.” creases their impact. Born in Dundee, Quebec, in 1950, The Main Findings of the Fraser Fraser graduated from McGill Univer- Report sity with a degree in commerce in 1972. 1. Senior federal officials in charge of After graduation, she worked as a the government’s advertising and chartered accountant in Montreal and sponsorship contracts in Quebec, along later in Quebec City, where she met and with five Crown corporations—the married Henri Gagnon. The couple has RCMP, VIA Rail, , the three children, whom they have raised Business Development Bank of Canada, in a totally bilingual environment. She and the Old Port of Montreal—wasted was the recipient of many awards for millions of taxpayers’ dollars in the her service to the accounting profes- running of the program, which was sion, and joined the federal civil service established after the Quebec sover- as deputy to the then auditor-general, eignty referendum in 1995. Denis Desautels. Upon her 10-year appointment to that position in 2001, 2. More than $100-million was paid to Sheila Fraser became Canada’s first various advertising and communica- female Auditor-General, a position tions firms, mainly in Quebec, in the dating back to 1878. form of commissions and service fees. Her 2002 report contained a scathing In most cases, these agencies did little denunciation of cost overruns in the more than hand over the cheques, while establishment of the federal providing few if any of the services for government’s gun registry program. In which the government originally con- addition, she warned that federal health- tracted them. care transfer payments to the provinces were not receiving sufficient scrutiny, 3. The government’s $3-million spon- and could lead to a serious waste of sorship of the RCMP’s 125th anniver- taxpayers’ money. But nothing prepared sary celebrations is just one example of even seasoned Ottawa observers for the how the sponsorship program wasted devastating critique of the federal money, because the Mounties already sponsorship program that was the focus had to display the word “Canada” on

CBC News in Review • April 2004 • Page 15 their uniforms. Three Quebec advertis- 5. Communications Canada gave ing agencies deducted $1.3-million $1.5-million to the Old Port of Montreal before passing on the $1.7-million to purchase a new screen for its science remaining to the RCMP. centre, but channelled the funds through two Quebec communications firms that 4. For producing a $5-million television collected $225 000 in commissions for series about the life and career of NHL arranging the transfer. star Maurice Richard, a number of Quebec communications firms received In concluding the presentation of her $440 000 in commissions without report, Fraser had these words to say signing any contracts or doing any about the sponsorship program and its work. The program also used VIA Rail financial operations: “I think this is a to transfer nearly $1-million to the blatant misuse of public funds that is series through a phony contract paying shocking. I am actually appalled by it for most of the money. Canada Post what we’ve found. I am deeply dis- was paid $1.6-million to sponsor the turbed that such practices were allowed series without a signed deal or any to happen in the first place. I don’t think documentation, a clear violation of the anybody can take this lightly.” corporation’s rules of conduct.

Inquiry 1. What qualities and background does Sheila Fraser bring with her to the position of federal Auditor-General? Why is her job so important for Canadians?

2. Read the main points in Sheila Fraser’s report about the financial practices of the federal sponsorship program. Which aspects of them do you find most disturbing, and why?

3. What steps do you think the federal government should take in order to a) punish those responsible, and b) prevent any further misuses of public money?

CBC News in Review • April 2004 • Page 16 LIBERAL TROUBLE: THE SPONSORSHIP SCANDAL Reading and Responding to Statements

Form groups with your classmates to read, discuss, and respond to these state- Here is a selection ments. Prepare and present a summary of your responses for discussion with the of statements concerning the class as a whole, using the following focus questions as a means of guiding your sponsorship scan- research and inquiry. dal, made by some of the main figures To Do involved in it, and 1. In your own words, identify who is making the statement and summarize commentators who what you think is being said. have followed the 2. As you read the statement, what are your initial reactions to it? story as it has been developing since 3. What value do you ascribe to the statement in terms of its ability to ac- February 2004. count for or explain any aspects of the scandal? 4. What do you think are the main intentions of the individuals making the statements? 5. With which statements do you tend to a) agree and b) disagree? Why? 6. How do you think the effects of the statements will influence a) the future course of the scandal and b) Canadian public opinion?

“I had no idea what was going on here. far. Most of all, I have paid the price of These acts were perpetrated by a very my honour and my dignity. A cabinet small group of 10 to 12 people within minister does not run his department. the 14 000 who work for Public Works. He does not have the time or the free- They didn’t come to cabinet and say dom to do so. The objectives of the ‘Oh, can we break the rules?’ They sponsorship program were very good. operated in secrecy. No one understood Unfortunately, there were management the full scope of what was involved problems. I am convinced that I dis- until the Auditor-General’s report. . . . charged my ministerial responsibilities Anybody who knew about that and did with integrity and honour.” — former nothing should resign immediately. It federal public works minister Alfonso was no secret that I did not have an easy Gagliano, testifying before the public relationship with those around the accounts committee, March 17, 2004 prime minister [Jean Chrétien]. In short, my advice was not routinely sought on “We have seen a money-laundering issues related to Quebec. I was certainly scheme that would make Saddam not in on the secrets of the gods. [As to Hussein look proud. This is corruption what I will do], to quote another prime at the highest level. Democracy is being minister, you just watch me” — Prime threatened here. When we start march- Minister Paul Martin, reacting to the ing people off to jail because they have Auditor-General’s report and the spon- filled their pockets with taxpayers’ sorship scandal it touched off, February funds illegally, then taxpayers will start 10-11, 2004 to see that justice is being done.” — Conservative MP John Williams, chair “I feel that I am the one who has paid of the parliamentary public accounts the greatest price for this scandal thus committee investigating the scandal

CBC News in Review • April 2004 • Page 17 “The public will soon get tired of the reputation, and it has an impact on the complex roster of names and amounts way in which people approach the that comes out of the Quebec advertis- Canadian government and Canadian ing scandal and will certainly not blame companies when they’re doing busi- Paul Martin for what was Jean ness. What you discover over time is Chrétien’s folly. Besides, the Martinites that if corruption is believed to be a see a silver lining to the clouds of the factor in the granting of contracts, then Quebec sponsorship fiasco: they note people will begin to think that they have that names of the government bureau- to offer bribes. For example, they have crats involved are French, that of the to engage in corrupt business practices agencies involved are all French and in order to win those contracts that they Gagliano is Italian. The more the offi- want so badly. So, eventually, it under- cial opposition stomps and charges and mines the standards of business con- screams, the less likely they are to duct.” — Wesley Cragg, head of Trans- persuade the Quebec electorate and parency International, a firm that moni- ethnics to stop voting Liberal. The tors corruption in business and govern- Quebec sponsorship fiasco is a bit of a ment boomerang for the opposition.” — journalist and media commentator “The patronage system now is almost , reacting to the scandal and exclusively for the elites, if I can put it its potential political implications that way. I mean, the big party support- ers, et cetera, advertising firms, law- “Paul Martin says he didn’t know what yers, people like that, and you can was going on. It’s an awkward inno- always name poo-bahs to the Senate. cence, coming from a former finance You have dozens and dozens of boards, minister and Quebec politician of senior agencies, and commissions, what the rank mainly because it involves a) so British call quangos. They’re doing much money and b) going into Quebec. things in the public sphere, and they And innocence of how government has have a board of directors, and in most been working and the stewardship of at cases, the CEO of that corporation and least some of its monies is not the the board of that corporation are ap- strongest virtue to present to the coun- pointed by the government. In the try when you’re about to go to it as Prime Minister’s Office, they have a prime minister in an election. It’s a system for knowing when these ap- good thing for all concerned that Sheila pointments are coming up because the Fraser isn’t running. She’d win every appointments have to be made, after all, seat and take home all the medals.” — and they have another system whereby CBC broadcaster Rex Murphy, offering they bring to the consideration of who his viewpoint on the scandal should be appointed partisan consider- ations.” — Toronto Globe and Mail “Canada’s international reputation as a columnist Jeffry Simpson, author of country with little corruption is slip- “Spoils of Power,” a study of the ping. That’s significant because it changing face of political patronage in means that a very positive asset that Canada Canadians have built over a very long period of time is now being eroded Source: All quotes are from www.cbc.ca. internationally. It has an impact on our

CBC News in Review • April 2004 • Page 18