OTTAWA—The 5,000 pages of documents released on the WE Charity affair have shed more light on early contacts between WE and the Liberal government ahead of the awarding of a $43 million contract to the organization to run a nearly $1 billion student grant program. The documents released to the House of Commons finance committee also revealed a cozy relationship between WE’s executives and cabinet ministers.
Central to the opposition parties’ probe into the scandal is whether cabinet members pushed for the awarding of the contract to WE Charity to administer the Canada Student Service Grant (CSSG) program. Prime Minister Justin Trudeau and now-former finance minister Bill Morneau have both apologized for not recusing themselves from the cabinet decision to award the program to WE on May 22, given ties between their family members and the organization.
The Liberal government maintains it was the public service that recommended outsourcing the administration of the $900 million program to WE Charity, and that cabinet only acted on this recommendation. We Charity stood to receive up to $43.5 million in fees for administering the program.
Opposition MPs have honed in on a call between WE Charity and Youth Minister Bardish Chagger on April 17, two days before public service contacted WE about the program, to examine if Chagger had any involvement in shaping WE’s proposal for the program.
During her testimony before the House finance committee on the issue on July 16, Rachel Wernick, an assistant deputy minister with Employment and Social Development Canada (ESDC), said WE Charity was an “obvious option” for handling the student service grant program given the organization’s prior experience in similar initiatives, and so she called WE on April 19 to discuss its potential involvement.
Wernick noted that WE Charity had already previously reached out to some cabinet ministers and government officials proposing a “social entrepreneurship for youth” program, which the organization had indicated could be adapted as required.
The government did not adopt the proposal, but Chagger says that WE Charity had spoken about it with her during their April 17 call.
Chagger insists she didn’t talk about the Canada Student Service Grant in the call, nor did she direct WE to adjust any of its proposals.
An April 22 email in the government’s released documents, however, shows WE Charity co-founder Craig Kielburger saying Chagger has provided his organization with a suggestion regarding “a summer service opportunity.”
“Our weekend team has also been hard at work to adapt your suggestion of a second stream focused on a summer service opportunity,” Kielburger wrote to Chagger in his email.
Contact With PMO
The CSSG program was announced by Trudeau on April 22. He has testified that he only learned on May 8 about ESDC’s proposal to have WE Charity handle delivery of the program.
The released documents show that WE Charity co-founder Marc Kielburger had sent an email to Trudeau’s chief of staff, Katie Telford, on April 13, thanking her “for all that you and the prime minister do,” to which she never responded.
But Craig and Marc Kielburger discussed the CSSG on the phone with PMO Director of Policy and Cabinet Affairs Rick Theis on May 5, and Craig later sent Theis an email.
“WE Charity raised their ongoing work with ESDC on the CSSG,” the released records say.
The records also say, “At no point were expenses discussed, nor any commitment, assurances or advice given by Mr. Theis to WE on any subject, other than to contact ESDC.”
An earlier email, sent on April 20 by Christiane Fox, Privy Council Office deputy minister of intergovernmental affairs, shows that the PMO had in fact been in touch with WE Charity “on a revised version” of “a service program” at least as early as April.
“I understand WE has been in touch with some of you (or your teams) on a proposal they have for social innovation picking up from discussions they had with us pre-COVID. I am told they met with Ministers [Mary] Ng, Chagger and other to discuss this + a revised version of the service program,” Fox writes to public service officials from other departments.
“They reached out today as they are also working with DPMO [Deputy Prime Minister’s Office] and PMO.”
In an email sent on May 5 to Theis at the PMO, Craig Kielburger attaches an updated version of the project plan and budget. A page in the package titled “a sample of our Canadian celebrity ambassadors” shows photos of Trudeau’s wife Sophie Grégoire Trudeau and mother Margaret Trudeau among the featured celebrities.
Trudeau’s brother and mother have received over $280,000 for speaking at WE Charity events, and his wife has received $1,400 for participating in a WE event in 2012, before Trudeau became leader of the Liberal Party.
Morneau repaid $41,000 to WE Charity in July for expenses incurred on trips his family took to Ecuador and Kenya with the organization to visit its projects there. One of Morneau’s daughters also works for the charity.
Morneau resigned from his cabinet post and as an MP on Aug. 17, saying he had mulled his departure for some time. He said he decided to step down because he was not planning to run in the next election and wanted to ensure the government had a finance minister for the long haul. He announced he would seek the secretary generalship of the Organization for Economic Cooperation and Development.
Ethics Commissioner Mario Dion is currently investigating Trudeau and Morneau under the Conflict of Interest Act for not recusing themselves from the WE Charity decision.
In a May 7 email to Wernick at ESDC, deputy minister for finance Michelle Kovacevic describes the relationship between the finance minister’s office and WE as “besties,” the government’s released documents show.
An email sent by Kielburger on April 10 to Chagger’s direct email account begins by wishing her “a happy belated birthday.” Another email sent a few minutes later to Morneau begins by wishing him and family members by name, a good Easter holiday.
During their testimony before the finance committee on July 28, WE Charity co-founders Craig and Marc Kielburger were pressed by New Democrat MP Charlie Angus on why they hadn’t registered as lobbyists. Angus later filed a complaint with the Lobbying Commissioner over WE’s unregistered activities.
The lobbying registry is full of charities except WE, Angus told the Kielburgers at the committee hearing, adding that “and yet none of them, say, for example, hire the prime minister’s mother or the prime minister’s brother.”
Craig Kielburger responded that “having a mother of an elected official, not [in] an elected official capacity, but as a speaker on mental health, these things I don’t believe are actually defined as lobbying.” He also said It was “highly unusual for us to be spending any significant amount of time with the federal government on these types of proposals.”
Under the Lobbying Act, in-house lobbyists are required to register with the Office of the Commissioner of Lobbying within two months after starting their lobbying activities.
We Charity officially registered as a lobbyist on Aug. 13, listing 18 employees as in-house lobbyists.
The log of the federal lobbyist registry notes 65 contacts between WE and federal officials or ministers beginning in January 2019, including the April 17, 2020, communication with Youth Minister Chagger, and 10 days earlier with Mary Ng, minister of small business, export promotion, and international trade.
‘Keeping the Relationship With WE Strong’
Opposition critics like Conservative MP Pierre Poillievre questioned why a third party program administrator was necessary when the Canada Revenue Agency was already managing applications for the Canada Emergency Response Benefit and would dole out student benefit payments of $1,250 per month in a separate stream under the $9 billion student aid package.
The CSSG would be an additional program to pay eligible student volunteers $1,000 for 100 hours of community service up to a maximum of $5,000.
On May 4, a day before Youth Minister Chagger would present the proposal to a special COVID-19 cabinet committee, officials from the Treasury Board Secretariat (TBS), the federal government’s accountant, expressed some general misgivings.
“TBS notes that ESD [ESDC] has not provided evidence to suggest that WE Charities possess the capacity to undertake this work, especially under accelerated timelines. Furthermore, the tracking of hours by a third-party could be challenging and result in potential integrity concerns should students not be honest about hours accrued.”
An additional $12 million recommended by Morneau for 20,000 “paid youth jobs under WE Charities” is also flagged by TBS.
“There should be a clear line between these proposals, particularly to ensure clarity between paid jobs and service placements.”
An internal email between ESDC officials on June 13 notes that “some of the opportunities look like they should be paid employment … to me. Even with COVID in the description, the opportunities feel like jobs.”
Twenty days later, on July 3, 2020, the government announced that it’s cancelling the deal with WE Charity.