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PM says he pushed back on WE deal, knew family's ties would lead to scrutiny

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OTTAWA - Prime Minister Justin Trudeau said he initially pushed back when he learned the public service had chosen WE Charity to run the Canada Student Service Grant, knowing his family's connections with the organization would lead to significant scrutiny.

"WE Charity received no preferential treatment, not from me, not from anyone else. The public service recommended WE Charity, and I did absolutely nothing to influence that recommendation," Trudeau said Thursday.

"When I learned that WE Charity was recommended, I pushed back."

Trudeau has long-standing ties to the WE organization and several of his relatives — his wife, brother and mother — have been paid to appear at its events.

In a rare prime ministerial appearance before the House of Commons finance committee Thursday, Trudeau said both he and his chief of staff, Katie Telford, first learned that WE Charity had been selected to run the grant program on May 8, mere hours before a cabinet meeting where it was to be discussed.

A timeline of the Liberals' WE controversy

OTTAWA - A timeline of events regarding the Canada Student Service Grant program, based on public documents, events and statements from cabinet ministers, government officials, and WE Charity:

March 6, 2020: WE Charity staff prepare a concept paper on service learning for public servants at Employment and Social Development Canada.

April 5: Finance Minister Bill Morneau and Prime Minister Justin Trudeau talk over the phone about how to help students whose summer job and volunteer opportunities were vanishing due to the COVID-19 pandemic. Finance Department officials are tasked with considering options the next morning.

OTTAWA - A timeline of events regarding the Canada Student Service Grant program, based on public documents, events and statements from cabinet ministers, government officials, and WE Charity:

March 6, 2020: WE Charity staff prepare a concept paper on service learning for public servants at Employment and Social Development Canada.

April 5: Finance Minister Bill Morneau and Prime Minister Justin Trudeau talk over the phone about how to help students whose summer job and volunteer opportunities were vanishing due to the COVID-19 pandemic. Finance Department officials are tasked with considering options the next morning.

April 7: Small Business Minister Mary Ng and WE co-founder Craig Kielburger have an introductory phone call in which Ng asks WE to send what it calls a "pre-established proposal" to help young people launch businesses.

April 7 or 8: Morneau's office contacts the WE organization, among other groups, to get their input on potential programs. Morneau says the call was on April 7 while WE says it was April 8.

April 9: WE Charity sends the unsolicited proposal for a youth business program to Youth Minister Bardish Chagger, Ng, Morneau and Trudeau's office. The price tag is between $6 million and $14 million to provide digital programming and $500 grants, plus "incentive funds," for 8,000 students.

April 16: ESDC officials mention WE in the context of the student program in an email discussion with Finance officials.

April 18: Morneau's officials raise the idea of partnering with a non-profit, or for-profit group to administer the program. (ESDC officials suggest the same day that WE might be an option.) Morneau said it was the first time he was involved in any talk about WE and the grant program.

April 19: Wernick contacts Craig Kielburger. WE says the call was to discuss launching a youth service program in the summer and that Wernick asks Kielburger to develop a proposal to fulfil that objective. During the call, Wernick learns of the April 9 proposal for a youth business program and Kielburger agrees to send both proposals.

April 20: Morneau's office contacts WE to ask about its ability to deliver a volunteer program. An official's record of the call notes "WE Charity will re-work their 10-week summer program proposal to fully meet the policy objective of national service and increase their current placements of 8,000 to double."

April 21: Morneau approves going with an outside organization to run the volunteer program, but no specific group is chosen.

WE's youth entrepreneurship program proposal is included in annex nine of a briefing package about a student aid program that goes to the Prime Minister's Office, chief of staff Katie Telford later tells the finance committee. The proposal is declined.

April 22: Trudeau announces a $9-billion package of student aid, including the outline of a volunteer program paying students up to $5,000 toward education costs, based on the number of hours they volunteer. WE sends Wernick an updated proposal to reflect the announcement. The message is forwarded to Chagger, Ng and Morneau.

April 26: Morneau speaks with WE co-founder Craig Kielburger, but told the finance committee neither of them talked about the Canada Student Service Grant program. Craig Kielburger later tells the committee he only brought up the youth business proposal, not the grant program.

April 27: Volunteer Canada, a charity that promotes volunteering and helps organizations use volunteers well, meets Chagger and raises concerns about paying students hourly rates below minimum wage and calling it volunteering.

May 4: WE sends a third proposal to ESDC, this time with more details and specific to the grant program. Finance official Michelle Kovacevic, who was working on the program, told the finance committee she received it May 7.

May 5: Chagger goes to a special COVID-19 cabinet committee with the recommendation to go with WE for the program. Neither Morneau nor Trudeau is at the meeting.

The same day, a member of the Prime Minister's Office policy team speaks with WE as part of stakeholder consultation, but then directs the organization to ESDC.

WE begins incurring eligible expenses.

May 8: Trudeau finds out that WE is being recommended to run the student-volunteer program hours before a cabinet meeting. He later tells the finance committee that he pulled the item from the agenda and sent it back to the public service for more due diligence because of how the deal could be perceived.

May 21: The public service comes back to Trudeau, he tells the finance committee. The recommendation to go with WE doesn't change.

May 22: Cabinet, including Trudeau and Morneau, approved handing the reins of the program to WE.

May 23: The public service officially begins negotiating a contribution agreement with WE, which would have paid up to $43.5 million in fees to the group.

May 25 to June 3: In a series of meetings with Volunteer Canada, WE suggests the target for placements through the program had gone from 20,000 to 100,000.

June 12: WE co-founder Marc Kielburger says in a video chat with youth leaders that he heard from Trudeau's office about getting involved in the volunteer program the day after it was announced by the prime minister. He later backtracks, saying the contact came the week of April 26 from Wernick, and not the Prime Minister's Office.

June 23: WE Charity Foundation signs a contribution agreement with the federal government. WE signatories include Scott Baker, named as president of the one-year-old foundation and executive director of WE Charity, and chief financial officer Victor Li. Chagger signs for the government.

June 25: Trudeau unveils more details about student aid. A government release notes that WE will administer the student-volunteer program.

June 26: Facing questions about WE, Trudeau says the non-partisan public service made the recommendation, and the government accepted it: "As the public service dug into it, they came back with only one organization that was capable of networking and organizing and delivering this program on the scale that we needed it, and that was the WE program."

July 3: Citing the ongoing controversy, WE and the Liberals announce a parting of ways and the federal government takes control of the program. Ethics commissioner Mario Dion tells Conservative and NDP ethics critics in separate letters he will examine Trudeau's role in the awarding of the agreement because of the prime minister's close ties to the group.

July 9: WE says it has paid Trudeau's mother Margaret about $250,000 for 28 speaking appearances at WE-related events between 2016 and 2020. His brother Alexandre was been paid $32,000 for eight events, and Trudeau's wife Sophie Gregoire Trudeau received $1,400 in 2012 for a single appearance. The organization says Trudeau himself has never been paid by the charity or its for-profit arm.

July 13: Trudeau apologizes for not recusing himself from discussions about WE over his family's longtime involvement with the organization. Morneau also issues an apology.

July 16: Dion says he will investigate Morneau's actions in the affair. Chagger testifies at the finance committee, saying Trudeau's office didn't direct her to go with WE.

July 21: Ian Shugart, clerk of the Privy Council, tells the Commons finance committee there is no evidence to suggest Trudeau spoke with WE before the organization was awarded the deal to run the student-volunteer program.

July 22: Morneau tells the finance committee he just repaid over $41,000 to WE for travel expenses the organization footed for the minister and his family. The Opposition Conservatives call for Morneau to resign.

Trudeau's office says he and Telford have agreed to testify before the committee with a date and time to be set.

The House of Commons ethics committee also calls on Trudeau to testify, and votes to seek copies of records for Trudeau and his family's speaking appearances dating back years. Six opposition members outvote five Liberals to have that committee start its own investigation.

July 23: Conservatives and New Democrats ask Dion to launch a new probe of Morneau over his travel expenses.

July 27: A copy of the contribution agreement with WE Charity Foundation is filed with the finance committee. It lays out the details of the program, including a provision for a maximum contribution of $543.53 million — $500 million for grants, and $43.53 million to WE.

July 28: Craig and Marc Kielburger testify over four hours of sometimes testy interactions with MPs on the finance committee. The co-founders of WE Charity say their history and experience, not ties to Liberal cabinet ministers, landed the group the deal to run the volunteer program. They add they would have never agreed to take part in the program had they known it could jeopardize the work the WE organization has done over 25 years.

They also say WE estimated the cost of the program to be between $200 million and $300 million.

July 29: The Conservatives call on the federal ethics czar to widen his probe of Trudeau to include travel expenses WE covered in addition to speaking fees for his mother, wife and brother. Dion sends letters to the Tories and NDP saying he is expanding his probe of Morneau to look into the $41,000 in WE-sponsored travel.

July 30: In a rare event, Trudeau testifies before the House of Commons finance committee and lays out when he first learned about WE's involvement in the Canada Student Service Grant program. He says WE Charity didn't receive any preferential treatment in the process. He also says it is now unlikely the grants will be rolled out. Telford also appears before the committee.

This report by The Canadian Press was first published July 29, 2020.

That was days after another group of ministers first heard about the need to let the charity run the program.

Trudeau said he wanted more due diligence done on the plan before it went to cabinet for approval, so he pulled the item from that day's cabinet agenda.

"I wanted to make sure all the Is were dotted and all the Ts were crossed," he said, "because of the connections with my family."

Trudeau said he had originally expected the Canada Service Corps to deliver the program, which would have given grants to students and graduates for volunteering to help with lost job opportunities due to the COVID-19 pandemic-related shutdown.

However, the public service advised the Canada Service Corps, a youth volunteer service program created by the Liberals in 2018, was unable to scale up fast enough to deliver the emergency grant program in time to help students affected by the struggling economy this year.

That's why the public service came back on May 21 to reaffirm its recommendation that WE was the only organization that could run the student-volunteer program, Trudeau said.

"The choice was not between providers, it was between going ahead with WE Charity to deliver the program or not going ahead with the program at all," Trudeau said.

Co-founders Craig (left) and Marc Kielburger introduce Prime Minister Justin Trudeau and his wife Sophie Gregoire-Trudeau as they appear at the WE Day celebrations in Ottawa in November 2015.

ADRIAN WYLD / CANADIAN PRESS FILES

Co-founders Craig (left) and Marc Kielburger introduce Prime Minister Justin Trudeau and his wife Sophie Gregoire-Trudeau as they appear at the WE Day celebrations in Ottawa in November 2015.

He also stressed he never spoke with WE co-founders Craig and Marc Kielburger at during the approval process, and when he learned of the public service's recommendation to contract WE, he knew there would be questions about his family's ties to the organization.

That was when he should have recused himself from the decision on the contract, Trudeau said.

After cabinet approved the WE deal on May 22, staff in his office recommended additional oversight measures for the dispersal of the approved funding, he said.

Trudeau agreed. A process was implemented mandating Youth Minister Bardish Chagger to provide a written update to the Treasury Board president on the grant program each time funds were disbursed.

WE has since backed out of the deal, citing the political controversy.

The Canada Student Service Grant is now unlikely to be part of the $9-billion student aid program Ottawa is rolling out this summer, Trudeau said.

"Getting young people to serve has been a goal of mine well before I ever got into politics, so I deeply regret how this has unfolded."

Conservative finance critic Pierre Poilievre had a few tense back-and-forth exchanges, pressing the prime minister to say how much WE Charity has paid in speaking fees or expenses for members of Trudeau's family.

WE has previously confirmed that Trudeau's mother, Margaret Trudeau, was paid about $250,000 for 28 speaking appearances at WE-related events between 2016 and 2020 and his brother Alexandre has been paid $32,000 for eight events.

The Kielburger brothers testified Tuesday that Trudeau's wife Sophie Gregoire Trudeau has participated in seven WE Days and received an average of $3,618 for each event, to cover her expenses. That works out to $25,326 in total.

Trudeau acknowledged his family's involvement with WE, and stressed that his wife's unpaid work with WE on a podcast on mental wellness, as well as expenses covered by the organization, had been cleared by the ethics commissioner.

The Conservatives have called on federal ethics watchdog Mario Dion to widen his probe of Trudeau to include these expenses.

Finance Minister Bill Morneau told the Commons finance committee last week he had freshly repaid WE Charity more than $41,000 in expenses for trips his family took in 2017 to see and take part in some of its humanitarian work.

SEAN KILPATRICK / THE CANADIAN PRESS

Finance Minister Bill Morneau told the Commons finance committee last week he had freshly repaid WE Charity more than $41,000 in expenses for trips his family took in 2017 to see and take part in some of its humanitarian work.

On Wednesday, Dion sent letters to Conservative and NDP MPs saying he is widening his investigation of Finance Minister Bill Morneau over trips he and his family participated in that were sponsored by the WE organization.

Morneau told the Commons finance committee last week he had freshly repaid WE Charity more than $41,000 in expenses for trips his family took in 2017 to see and take part in some of its humanitarian work.

Trudeau said he didn't know Morneau had travelled with WE or that one of his daughters worked there.

Appearing after Trudeau, Telford told the committee she too regrets the way this program was handled.

In hindsight, the government could have done multiple things that would have saved the student-volunteer program, she said.

"We could have done better, we could have done more. We could have added yet another layer of scrutiny to avoid any potential perception of favouritism," she said.

She also said Trudeau's office will work with the ethics commissioner to make improvements and take any advice he has on how to limit potential conflicts.

Conservative finance critic Pierre Poilievre had a few tense back-and-forth exchanges with the Trudeau, pressing the prime minister to say how much WE Charity has paid in speaking fees or expenses for members of Trudeau's family.

SEAN KILPATRICK / THE CANADIAN PRESS

Conservative finance critic Pierre Poilievre had a few tense back-and-forth exchanges with the Trudeau, pressing the prime minister to say how much WE Charity has paid in speaking fees or expenses for members of Trudeau's family.

Poilievre asked Telford why WE began working on the student grant program and incurring expenses May 5 if it had not yet been approved by cabinet. That was the same day Chagger brought the proposal to the smaller cabinet committee.

The Kielburgers have said officials told WE it could incur eligible expenses before being awarded the agreement. They said they wanted to get the program going quickly, knowing they could lose money if cabinet said no.

Telford said Rick Theis, a Trudeau policy adviser, took a call from WE that day but redirected the organization to Employment and Social Development Canada.

 

This report by The Canadian Press was first published July 30, 2020.

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