Harper shrugs off actions of key Conservative senators in spending scandal

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MISSISSAUGA, Ont. – Stephen Harper appears to have absolved some of his top senators from any responsibility in the Mike Duffy affair, despite court testimony detailing their handling of a controversial independent audit before it was completed.


Duffy’s trial for fraud, breach of trust and bribery, which is on a break until November, heard that Sen. Irving Gerstein asked for information from a contact at Deloitte about the audit of Duffy’s expenses in early 2013.

Aides in the Prime Minister’s Office wanted to know if Deloitte would refrain from reaching conclusions about Duffy’s Senate residency – if he repaid his expenses.

Harper’s former chief of staff, Nigel Wright, testified that Sen. David Tkachuk first suggested the audit could be quietly called off if the expenses were repaid. Tkachuk was chairman of the Senate’s powerful internal economy committee.

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Harper has repeatedly balked at the suggestion any of Wright’s subordinates should be held accountable for the affair. While senators as parliamentarians are not junior to anyone, Harper stuck to his position on Tuesday that only two men – Duffy and Wright – bear any responsibility for the scandal.

“The audit firm itself has attested to the propriety of the audit,” Harper said. “That’s their responsibility and this is a matter for the Senate.”

Deloitte executive Michael Runia told the RCMP that Gerstein asked him what would happen to the audit if Duffy repaid the funds. The two men knew each other because the Conservative party is a Deloitte client.

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Terms of the audit commissioned by the Senate were strictly confidential. Only a handful of people had access to information; Gerstein was not one of them.

It’s unclear what Gerstein learned from Runia, but afterward, Harper’s staff exchanged emails about what they believed they could count on from Deloitte.

“Just heard from Gerstein. Here’s the latest and most useful information yet from Deloitte,” parliamentary affairs aide Patrick Rogers wrote in one email.

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“Any repayments will not change Deloitte’s conclusions because they were asked to opine on residency. However, they can’t reach a conclusion on residency because Duffy’s lawyer has not provided them anything.”

Harper’s former director of issues management, Chris Woodcock, admitted to the court last month that the actions around the audit made him “uncomfortable.”

Wright secretly repaid Duffy’s $90,000 in living expenses in April 2013, after negotiations between figures in the PMO and Duffy and his lawyer. Several people knew about either the payment, elements of the agreement with Duffy, or both.

Harper has also refused to assign any blame to other senior staff in his office who were involved, telling the CBC in an interview that nobody but Wright acted unethically or irresponsibly.

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On Tuesday, NDP candidate Francoise Boivin said Canada’s director of public prosecutions should be reviewing the actions of PMO staff. She called on outgoing Justice Minister Peter MacKay to refer the matter.

Wright revealed during the trial that he had been in contact with Novak as recently as two weeks before his testimony began. And Woodcock was seen speaking to his successor at the PMO in the hallways of the courthouse.

“(MacKay) has a responsibility to make sure any possible political interference with a witness giving testimony under oath is reviewed by the director of public prosecutions and referred to the proper authorities,” Boivin said.

Several of the PMO players involved went on to other prime positions inside the Conservative government. Ray Novak was promoted, taking over from Wright when he left as Harper’s chief of staff in the wake of the scandal. Novak is currently a senior campaign director.

Gerstein kept his position as chairman of the Conservative Fund and Senate banking committee. Gerstein’s name still pops up on requests for money sent to party donors.

He told a Conservative convention in 2013 that he rejected Wright’s request for repayment of Duffy’s expenses, despite the fact the party was prepared to pay a lesser amount of $32,000.

Harper was in Mississauga, Ont., to announce that a re-elected Conservative government would increase the amount of money it kicks in when low- and middle-income families invest in education savings plans.

The increase to the Canada education savings grants would mean that a family earning up to $44,000 would receive $200 for the first $500 socked away for their child’s higher education plan each year. A family earning up to $88,000 would receive $100 on the first $500 each year.

“This is an important but it is an affordable commitment,” Harper said.

And you know that when we Conservatives make such a commitment, because it is affordable, we will deliver on that commitment.”

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