Solving WE’s ‘which came first’ problem

Andrew MacDougall is a director at Trafalgar Strategy, and a former Head of Communications to Prime Minister Stephen Harper

When it comes down to it, the WE Charity scandal is essentially a ‘which came first’ problem. Only, instead of a chicken and an egg, we have a program and a delivery partner. Was the Canada Student Service Grant (CSSG) a proper thing in search of a delivery partner or was it a notion rounded into shape by one delivery partner to the exclusion of all others, a delivery partner with some serious financial ties to the finance minister and the family of the Prime Minister?

The evidence presented to the Finance Committee looking into the cancelled WE deal offers evidence in support of both chicken and egg. Federal bureaucrats and members of the government testified that other organizations were considered to deliver the CSSG. But recently released lobbying records demonstrate that only WE Charity was busy repeatedly ‘interacting’ with the federal government over the period when the CSSG was fleshed out and brought into existence.

The story of the ill-fated volunteer grant begins as very few things do in Ottawa: on a Sunday work call between the Prime Minister and his then finance minister. The two men were finalizing the details of the Canada Emergency Wage Subsidy (CEWS), to be announced the following day by Justin Trudeau, according to testimony at the House finance committee by Trudeau’s chief of staff, Katie Telford. At the end of the call Bill Morneau mentioned some areas where he thought the government response to COVID-19 was still falling short. One of those areas was students. The Prime Minister agreed and tasked his minister with working up some policy options.

The next day the minister’s office and department swung into action. As Trudeau delivered his morning press conference announcing the CEWS, Michelle Kovacevic, an associate deputy minister at Finance, heard Trudeau promise more action for students. Kovacevic immediately reached out to counterparts at Employment and Social Development Canada (ESDC) to “hear about options” to do more for students. She also rang up the Minister’s office to see if they were privy to more detail.

For its part, the minister’s political office was busy hitting the phones, chatting with 12 organizations for “input” in their quest to work up options. One of those organizations was WE Charity. A summary of these conversations titled ‘What We Heard’ was prepared and shared with Kovacevic and other officials on April 9. At this time, the CSSG wasn’t yet a twinkle in anyone’s eye.

READ MORE: Bill Morneau, melting away

As the minions at Finance were busy answering Morneau’s call, the braintrust at WE Charity were suffering a torrid time. The chair of the charity’s board of directors, Michelle Douglas, had resigned on March 27 following a dispute with WE’s founders, Craig and Marc Kielburger, over matters of financial transparency. Hundreds of WE employees were being laid off due to the economic effects of the pandemic. A proud and popular charity was taking a massive hit, a fact that wasn’t being shared with those calling on behalf of the government.

Instead, the WE team were busy flogging a youth social entrepreneurship proposal to Mary Ng, Trudeau’s small business minister. Craig Kielburger mentioned the proposal to Ng on an introductory April 7 call, the same day Morneau’s office was on the phone to Sofia Marquez at WE getting her input on possible federal programming. Kielburger would eventually send the proposal through to Ng on April 9, before also shipping it to the offices of Morneau, Trudeau, and Bardish Chagger, the Minister for Diversity, Inclusion, and Youth. If billions of dollars was hemorrhaging out of government, often daily, it was worth WE taking a shot. WE followed up its proposal with Morneau’s office via Amit Singh, a Morneau policy advisor, on April 10.

Chagger’s officials ended up forwarding the WE social entrepreneurship proposal—which plumped for digital programming and $500 grants, plus “incentive grants”, for 8,000 students—to their counterparts in Finance on April 16, the same day their department provided a list of potential delivery partners on “volunteer opportunities”. In her response, Finance ADM Kovacevic asked her ESDC counterparts to consider WE in its analysis of potential delivery partners, even if no-one yet knew the final shape of the volunteer policy being developed. All officials knew was that Trudeau and Morneau wanted a volunteer component included.

Meanwhile, ESDC officials, led by Senior Assistant Deputy Minister Rachel Wernick, were in the midst of contacting the national coalition members of the Canada Service Corps to see what they might contribute to the possible response. ESDC officials had already been in touch with the 12 organizations as a group on March 27 and April 3—i.e. before Trudeau’s chat with Morneau—to talk about the beefing up of the Canada Service Corps that was to come.

Officials also arranged a series of follow up calls with the groups which began on April 14 with Apathy is Boring, a 23-person charity based in Montreal, and concluded with a call to the Canadian Wildlife Federation on April 21. At the time of the April 16 email from ESDC to Finance on potential delivery partners for the government’s youth package, eight of the 12 national coalition members had been contacted.

Of these eight organizations only the YMCA registered any subsequent contact with ESDC officials in the lobbying registry, an April 16 chat with a staffer to Minister Carla Qualtrough. Whatever was said by the government didn’t appear to prompt much interest, whether in the volunteering component that became the CSSG, or any of the other measures that were eventually announced. And of the four groups contacted by ESDC after April 16, only the Boys and Girls Club of Canada registered any subsequent contacts with ESDC, all under the banner of budget consultations. The government’s student package, including the CSSG, was never a part of any budget process.

READ MORE: The Canada Student Service Grant’s unusual cabinet ride

While EDSC was striking out with the members of the Canada Service Corps, WE Charity was having better luck. Indeed, on April 17, the day after Minister Chagger’s officials sent the WE social entrepreneurship proposal to Finance, Chagger had a call with WE, a meeting that also included her Chief of Staff, Director of Communications, and Director of Operations. This is the meeting Chagger later erroneously told the Finance Committee she had taken alone with WE.

The Canadian Press reports that Chagger’s April 17 phone call was followed up with a thank-you email sent to her on April 22 from Craig Kielburger. He wrote: “We appreciate your thoughtful offer to connect us with relevant members of your ministry. Our weekend team has also been hard at work to adapt your suggestion of a second stream focused on a summer service opportunity.”

The wheels were also turning at Finance, where officials were now actively considering a third party to deliver the volunteer program that was taking shape as part of the broader student package. At an April 18 evening meeting between ESDC and Finance officials it was Kovacevic who noted that WE Charity might be an option. There is some confusion as to who first suggested WE as a potential partner but all on the call agree that it was Wernick, the ESDC ADM, who was tasked with following up with WE.

Wernick rang Craig Kielburger the following day—April 19—to sketch out the “broad parameters” of a “national service program” and to solicit a proposal. For his part, Kielburger says Wernick provided only the “policy objectives” to which he then responded by modifying his group’s original social entrepreneurship proposal.

Before sending in that modified proposal, however, WE Charity lined up two further meetings on Monday, April 20, one with Amit Singh from Morneau’s office and another with Christiane Fox, a senior member of the Privy Council Office with responsibilities for youth policy. It is on this day that WE’s lobbying registrations—added only after the brothers testified at committee in late July—shift from discussing “education” with officials (i.e. the social entrepreneurship proposal) to “employment and training”, which can be read as discussions about the CSSG. In other words, there was now a different target for WE.

And while it still isn’t clear what was discussed between WE, Morneau’s office and PCO in the April 20 meetings, it’s reasonable to assume the information imparted by the government’s central agencies helped to focus the WE proposal. More importantly, there is no indication any other potential delivery partner got a similar head start. By the time WE’s revised proposal reached Wernick’s desk on April 22, the day Trudeau announced the government’s student package, it included more information that Wernick had about the program when it was announced.

Wernick testified that she had to reach out to Finance officials following Trudeau’s announcement to get more details, hearing back from Finance that the CSSG program parameters focused on two key elements: a web-based digital platform that would allow students to apply for the CSSG program and be matched with volunteering opportunities in their community and track their hours completed, and a grant of up to $5,000 for volunteer hours completed. The WE proposal tracked both of these elements closely.

The WE proposal was so on point Finance and ESDC officials began talking about WE as a delivery partner the very next day. This is the day Marc Kielburger would later say, in a June 12 call with potential WE partners, that the Prime Minister’s Office reached out to ask if they wanted to help deliver the CSSG. Kielburger would later recant, saying it was an ESDC official (Wernick) who made the call following the announcement, not Trudeau’s office.

Whatever the case, with the program now announced the task now fell to the public service to draw up a Memorandum to Cabinet (MC) with the delivery details fleshed out. Lo and behold, on April 24 WE lists a meeting with all of the senior political and bureaucratic players: Amit Singh (Morneau’s office), Michelle Kovacevic (ADM Finance), Suzy McDonald (ADM Finance), and Rachel Wernick of ESDC. And while Kovacevic testified that “no commitments were made” at the meeting, it’s not clear anyone in government was chasing other suitors.

In fact, on the same day WE was meeting with the above group of senior officials, officials from Volunteer Canada were in touch with ESDC about administering the CSSG program. The group also raised concerns about the level of payments to students. There wasn’t a second meeting. Volunteer Canada would eventually be contacted by WE Charity in early June to help administer the government’s volunteer program, an offer Volunteer Canada declined, citing concerns about the level of payments to students.

The lack of competition to administer the CSSG didn’t appear to be bothering anyone in the government. If anything, it was full WE ahead as the MC went through the system. With university students already finishing school things had to move quickly. The government wanted the program up and running by mid-May, with the CSSG MC scheduled to be discussed by the government’s COVID-19 Cabinet Committee on May 5 and by the full Cabinet on May 8.

WE wasn’t leaving anything to chance as the MC was being drafted. It met again with Amit Singh on April 28 and with Rachel Wenrick that same day. And on May 1, the charity met separately with political staff from Morneau and Chagger’s offices. (What those ministers’ offices might have said to each other, either before or after that meeting, remains undisclosed, as does any contact regarding WE between ministers’ offices during the entire period in question.) WE also met that same day with Wernick from ESDC. Perhaps not feeling secure in its position, WE Charity met with Wernick a further two times in the next three days as the MC was refined. The subject matter for all meetings: “employment and training”.

Early May is also when Wernick testified she sent the proposed MC to the Minister’s office for review ahead of its expected rendezvous with the COVID-19 committee. In other words, after a week or so of intensive contact following the announcement between the charity and various ministers’ offices and senior members of the public service—to the apparent exclusion of all other possible delivery partners—an MC went to a Cabinet committee recommending WE as the only delivery option.

When asked why no other options were offered to Ministers for consideration, Clerk of the Privy Council Ian Shugart testified: “I do not believe that options were provided in this case, because the lines of the program, broadly speaking, had already been announced by the Prime Minister as being the government’s objectives to deal with this issue. What was recommended to cabinet followed those lines.” What Shugart is saying, in his typically understated terms, is that the public service served up what the government ordered.

In other words, the chicken and egg problem is now solved.