November 1, 2005

Good morning.

Today is the conclusion of the first part of a long and arduous voyage of discovery which commenced on February 10, 2004 when I was appointed to be the Commissioner of this Inquiry. I thought it would be appropriate to make a statement to the media and to the persons watching on television or listening by radio, to tell you about the results of the Inquiry so far, and where the Commission will go from here.

Many people have asked me if I imagined the size, the difficulty and the importance of this undertaking when I took it on. The answer is no, but the last twenty-months have provided me with a stimulating and unforgettable learning experience, which I do not in any way regret. I am happy to have reached this intermediate stage in the Inquiry, and look forward to its completion in about three months from now.

As I said in May 2004 during my opening statement made in the National Conference Centre here in Ottawa, the fact finding hearings of the Commission of Inquiry into the Sponsorship Program and advertising activities of the Government of Canada would be the first of two phases necessary to fulfill the double mandate given to me on February 10, 2004. According to its Terms of Reference, the Commission has investigated questions raised by Chapters 3 and 4 of the November 2003 Report of the Auditor General of Canada. Today marks the completion of the first phase a few hours ago, with the delivery to the Governor in Council of a Report setting out my findings of facts and the conclusions I have reached from hearing and studying a large body of evidence.

Allow me to summarize once again the subjects mentioned in the Terms of Reference. I do so because there may be misconceptions about what I was asked to do and how far I was able to go with the evidence presented at the hearings.

I was asked to investigate:

• the creation, purpose and objectives of the sponsorship program;
• the role and responsibility of elected and non-elected public office holders in the Government of Canada, in the creation and management of the Sponsorship Program, and in the selection of communications and advertising agencies;
• whether Parliament was bypassed;
• whether any person or organization gained an undue advantage financially, politically or otherwise from the activities;
• whether the procedures, structures, reporting lines, systems for approvals and internal controls which were used and implemented by the Government of Canada, were sufficient;
• whether the culture and structure in the Government of Canada discouraged whistleblowing;
• the identity of those persons who received the sponsorship, communications and advertising funds, including any commissions or fees payable with respect to them, the purpose for which the funds were disbursed, and the extent of value for money received in return by the Government of Canada;
• whether there was political influence or interference on the distribution of the funds, and whether there were political contributions of an improper nature made by recipients of the funds.

With the delivery of my Report today, I have attempted to address these issues.

I do not pretend to have described in the Report all of the evidence that was presented, since that would have made the Report far too long and detailed. In any event much of the evidence was only of marginal significance. Included in the Report are what I consider to be the most important and significant facts and circumstances that are necessary to an understanding of my conclusions. But I hasten to add that in reaching those conclusions I have taken into consideration all of the relevant evidence that was presented to me, even those facts that are not mentioned in the Report.

I have chosen to make this statement today and not to hold a press conference. There are undoubtedly many questions which the media following this Inquiry would like to ask, but a careful reading of the Report should provide the answers to most of those questions, and I do not want to add anything to what I have written. The whole Report must be read in order to understand my conclusions. It would be unwise and unfair for me to comment on only certain aspects of the Report, or on one transaction, one policy, one individual, one company, one failure or, one misconduct. The Report, of which I am the sole author, speaks for itself.

I have tried to write it in plain language that anyone should be able to understand, and to avoid using obscure legal expressions and bureaucratic jargon. I hope it is accessible to everyone, and that anybody who is interested in the matters that gave rise to the appointment of the Commission will take the time necessary to read the entire Report, and not just selected extracts.

The findings in the Report of the Auditor General raised serious issues, which continue to be the subject of debate in the House of Commons and in the media. My investigation, using the jurisdiction available to me through the Inquiries Act, has gone much further than the Auditor General could go. For example, the Commission was able to subpoena documents and records from private corporations, and compel testimony from many people involved in the events that led to this Inquiry, whether or not they agreed to be examined. There were things the Auditor General and her staff could not do.

When the public hearings commenced, in my opening statement I announced the procedure that would be followed in the Commission's inquiry and the principles that would guide its public hearings and the administration of the evidence to be presented. I believe that I am entitled to say, with confidence and some pride, that my intentions have been substantially realized. Throughout the hearings I attempted to respect the principles that I said would guide the Commission's work: independence, fairness, thoroughness, expedition and efficiency. The successful conclusion of the public inquiry by the delivery of the Report on the date it was promised is due to the energy and talents of many people and I want to thank all of the employees of the Commission for their efforts. In particular, I want to thank my legal team, including all the junior lawyers who assisted them, for their long hours of work, and for their skill and diligence in preparing and presenting the evidence during our public hearings.

The hearings began in Ottawa in this building on September 7, 2004, and were continued here for approximately six months. We then transferred our operations to Montreal until June 17, 2005 when submissions by counsel were completed and I began the preparation of my Report. At the hearings twenty-five participants and intervenors were granted standing and attorneys representing them were in attendance at various stages. We heard a total of 172 witnesses over 136 days of hearings. In the Ottawa phase of our hearings, many Cabinet Ministers and senior government officials appeared and testified before the Commission and it is probably unprecedented, both in Canada and elsewhere in the world, that both the sitting Prime Minister and his immediate predecessor were called to testify as witnesses.

From those hearings, more than 25,000 pages of transcripts in both official languages have been produced, as well as 1,068 volumes of documentary evidence encompassing 168,000 pages. And that does not include evidence which is not in the form of paper, such as videocassettes, CD-ROMs and other digital files that comprise another 20,000 to 30,000 pages of documentation. By any standard, this has been a formidable body of material to put into order, to analyze and to digest.

As required by its mandate, the Commission extended its investigation beyond the boundaries of the Auditor General's Report and beyond the boundaries of government administration. It has been able to investigate the receipt and use of funds and commissions disbursed in connection with the Sponsorship Program, and to examine the actions and conduct of communication agencies, their owners and their personnel, purportedly acting on behalf of the Government to administer sponsorship projects. We also looked into the commissions and fees those agencies charged and the use of funds derived from the Sponsorship Program, for political and other purposes.

The Terms of Reference in paragraph (k) specifically direct me to perform my duties "without expressing any conclusion or recommendation regarding the civil or criminal liability of any person or organization," and I am further instructed in the same paragraph "to ensure that the conduct of the Inquiry does not jeopardize any ongoing criminal investigation or criminal proceedings." I have been careful throughout the hearings and in the preparation of my Report to follow those instructions. The reader of the Report should not interpret anything said in it as an indication that I have come to any conclusions or opinions on the subject of the possible civil or criminal liability of anyone. It would be imprudent for me or for anyone to come to such conclusions on the basis of the evidence presented to the Inquiry, for the very good reason that the rules of evidence and the procedure followed at a commission of inquiry are very different from those in a court of law. The findings of fact and the conclusions that I have reached may not necessarily be the same as those that would be reached by a court of law. Accordingly, there are no legal consequences attached to my determinations. The Report is not a Judgment and I have not been acting as a Judge in performing my duties as a Commissioner, although my years of experience as a Judge have assisted me in appreciating the evidence. The Report consists of my findings of fact, and the opinions that I have formed in my capacity as a Commissioner, on the basis of the evidence in the Inquiry's record.

I was obliged to resolve many conflicts in the testimony. The Report expresses my conclusions as to which evidence I accept and which I do not. Those conclusions, based upon the evidence and upon my appreciation of the testimony of the witnesses who appeared before me, are necessary to fulfill my mandate. The Report would be of little value to Canada's citizens or government if it did not include my opinions on the reasons why and how mismanagement or misconduct occurred, and as to who was responsible, directly or indirectly, for that mismanagement and misconduct. It is equally important to identify the persons who, on the basis of the evidence, are not responsible for any misconduct or mismanagement.

Like any author who has worked hard at preparing a manuscript, I hope that everyone will read the whole Report, but I acknowledge that it is long, and that there are many parts that you may find dry and difficult to follow. To make it easy to identify which passages I consider to be of particular importance, they appear in a different color in the Report, and are marked in the margins as being of major importance.

There is as well a Summary that provides an overview of the major findings, but I caution readers that it is best to consult the whole Report in order to have a proper understanding of how I came to my conclusions, and the evidence upon which those conclusions rely.

My mandate and my Report deal with more than problems that arose in what has come to be known as the "sponsorship scandal". This Commission is officially known as the Commission of Inquiry into the Sponsorship Program and Advertising Activities. Questions concerning the advertising activities of the Government are sometimes overlooked, but the Report deals with events and activities in the context of both of these areas. Because of the dramatic nature of some of the evidence, the media has naturally tended to focus on the problems arising from the Sponsorship Program, but I remind you that there is a bigger perspective, which deals with the Government's contracting procedures, supervision and oversight, and the interactions between political officials and public servants.

I am now able to turn my attention and thoughts to the second phase of the Commission's mandate: I have been asked to make recommendations to the Government of Canada, based upon the findings of fact described in today's Report, to prevent mismanagement of sponsorship programs and advertising activities in the future. You may be interested to know that work on this second phase is already well advanced. In recent weeks, I have visited five cities, Moncton, Quebec City, Toronto, Edmonton and Vancouver, in five different regions of Canada, accompanied by the members of a special Advisory Committee that I appointed to help me to formulate my recommendations. The Commission has also invited submissions from various organizations, and from individual members of the public who have been given an opportunity to provide input to specific questions, on our website or through the mail.

The Terms of Reference authorize me to conduct these consultations. My Advisory Committee, consisting of distinguished Canadians with backgrounds in politics and public administration, as well as academics and a retired Judge, joined me in travelling across the country for our round-table meetings with community leaders and experts having experience in the conduct of corporations and government, to seek their views and to have the benefit of their wisdom and experience on key issues that have arisen as a result of the first phase of my Inquiry. The discussions, advice and comments resulting from these meetings have been enlightening and very useful. In each region visited, we have heard different perspectives on some common themes. Without describing in detail all the matters that will be examined in preparing for the delivery of my second Report, I can tell you that it will deal first of all with problems of ministerial responsibility and accountability at all levels of government, and with the need for transparency in government.

Another theme that seems to preoccupy everyone is the question of the accountability of deputy ministers and senior officials. The title of my first Report released today is "Who Is Responsible?" If Ministers of the Crown do not accept responsibility when government expenditures and programs are mismanaged, then on whose shoulders should responsibility rest? Should it be public servants? Should ministers be forced to accept responsibility and suffer the consequences of faults in departmental management? Should deputy ministers, the public service heads of departments under ministers, be held responsible for financial management and be held accountable for departmental maladministration?

The Commission's mandate directs me to address these questions of the respective responsibilities and accountabilities of ministers and public servants. The issue is not whether to get rid of the principle of ministerial responsibility, but whether the interpretation of this principle needs to be clarified or modified to ensure that someone will be responsible to ensure that laws and rules are observed. We also need to examine the role that should be played by Parliament and parliamentary committees in ensuring that public servants observe the rules. To whom should they be required to account for their actions, and in what ways should public servants be protected from undue political influence in carrying out their duties? This issue requires me to give attention to the role of the political staff in each Minister's office and in the office of the Prime Minister, and its relationship with public servants.

Another area that we are exploring is the need for changes in our political and administrative culture. Are such changes necessary and are changes possible? Any organization as large as the federal government will invariably experience problems. An important concern is the manner in which politicians and public servants react to problems when they are uncovered. Some people feel that there should be a greater capacity to respond positively to problems of mismanagement, to use them as a basis for reform and improvements, and not to avoid dealing with them by pretending they do not exist.

An issue also to be studied in Phase Two has to do with the accountability of Crown corporations and other agencies that are supposed to operate at arm's length from government. There are two key issues relating to Crown corporations. One is the manner in which appointments are made to their Boards of Directors. Should there be modifications in the manner in which these appointments are made by the government, or should some other approach be adopted? And how should their Chief Executive Officers be appointed? Secondly, should the relationship between government and Crown corporations as well as other arm's length agencies of government be strengthened or loosened in terms of providing strategic direction?

We are also looking into the appropriate role of the Clerk of the Privy Council and the relationship to the government of what are called the central agencies such as the Privy Council Office and the Treasury Board Secretariat. In the public hearings, questions arose about whether the Privy Council Office provided appropriate support and advice to the Prime Minister and whether appropriate oversight came from the Treasury Board and its Secretariat. Questions also arose about the use of internal audits of the sponsorship initiatives, and how they were, or were not, followed up.

Other areas of investigation have to do with the transparency of government, a subject which includes Access to Information legislation, and the need for whistleblower legislation.

As already indicated, I have been obtaining expert advice on these issues and I have invited and received submissions from government departments, corporate Canada and the general public.

We have commissioned academic and other experts to produce research papers with respect to some 16 subjects. These papers are now arriving on my desk. They will be carefully read and considered by the Advisory Committee, as well as by myself.

As you can see, an enormous amount of work remains to be done. I have undertaken to produce my second Report on February 1, 2006, which will be just a few days before the second anniversary of my appointment as the head of this Commission. The task is challenging but I consider it a privilege to be given this opportunity to contribute to the improvement of the government of my country. While I am tackling the important issues that will be the subject of the recommendations in my second Report, I leave it to those citizens who are interested in the subject to read my first Report, and if they wish, to let me know what they think of it and how best the problems which it describes can be avoided in the future. All suggestions will be given my attention.

Thank you for your attention.