Facebook Instant Articles

Bill Morneau, Canada’s very expensive finance minister

Stephen Maher on how Bill Morneau is squandering opportunities and causing blowback that Trudeau can no longer afford
Stephen Maher
Finance Minister Bill Morneau makes an announcement on housing in Toronto Monday, October 3, 2016. The federal government has announced measures intended to stabilize the real estate sector amid concerns that pockets of risk have emerged in some housing markets, particularly those in Toronto and Vancouver. (Nathan Denette/CP)
Finance Minister Bill Morneau makes an announcement on housing in Toronto Monday, October 3, 2016. (Nathan Denette/CP)
Finance Minister Bill Morneau makes an announcement on housing in Toronto Monday, Oct. 3, 2016. (Nathan Denette/CP)

When Bill Morneau stands in the House of Commons on Tuesday to deliver the fall fiscal update, he will be hoping desperately that what he announces will be splendid enough that Canadians take note.

For weeks, stories about Morneau and his bungled files have been preventing his boss, Justin Trudeau, from getting the feel-good coverage that he prefers. When’s the last time you saw a story about his socks, for example?

Morneau, who is supposed to present an image of bland competence as Trudeau’s Bay Street lieutenant, instead looks, at best, like a bumbler, at worst like someone with multiple undeclared conflicts of interest and a secret villa in the south of France.

READ MORE: Throw another minister on the bonfire: the ballad of Bill Morneau

The problem—the very serious, career-threatening problem—is that whatever the nature of Morneau’s errors, no matter how innocent they are, he is under brutal pressure to change the headlines. And that should make us worry, since he’s in charge of our money, and you don’t want the person in charge of your money to be desperate for attention.

Trudeau can’t be pleased.

Morneau can be forgiven, I suppose, for failing to inform the ethics commissioner about the shell company that owns his French villa. That’s the kind of thing that Trudeau, who spent his Christmas holidays on a private island in the Bahamas, likely understands.

WATCH: Morneau takes heat in the House over conflict of interest claims

But Trudeau can’t afford to ignore the blowback from the proposed small business tax reforms, or stories about numbered companies and conflicts of interest, not necessarily because of wrongdoing, but because they raise questions about the minister’s competence and keep Canadians from focusing on the marvelous things the Liberals are doing.

Trudeau’s political future depends on successfully convincing Canadians that he is acting in the interest of the middle class and those working hard to join it, which is why he repeats that phrase whenever he is anywhere near a microphone.

Morneau, as finance minister, has a key role to play in that sales job, but he can’t do that when he is talking fast about his French villa or his numbered companies, or worse, refusing to talk about them. At that point, the messenger becomes the message, and the message is arrogance.

Morneau didn’t help himself, at all, on Friday, when he brushed off reporters’ questions about his numbered companies by telling them he reports to the ethics commissioner, not them. Oh yeah, buddy? How’s that working out for you?

But that wasn’t even the worst Morneau news conference of the week. That was Monday, when Trudeau insisted on taking questions that reporters wanted to ask Morneau, the political equivalent of having your parents do your homework.

It seems increasingly clear that Morneau, whatever his strong points, isn’t great at politics. There’s no shame in that—it’s a largely superficial, silly business—but he has decided to take it up, and it imposes certain tiresome obligations, like explaining oneself to reporters, even though they are generally not the sort of people one would invite to one’s French villa.

As grim week follows grim week, you have to wonder whether Morneau regrets giving up a quiet, pleasant life as boss of Morneau Shepell for the more glamorous life of responding to nasty questions from the likes of Pierre Poilievre, the Conservatives’ nasty Finance critic.

How galling it must be to have to listen to his oily innuendo and respond with bland boilerplate about the middle class! But Morneau can’t offer substantive answers because the facts of the matter are so bad.

When Morneau was elected as an MP, he resigned from Morneau Shepell and shifted more than two million shares—worth more than $40 million today—to a numbered company directed by his wife, frozen-food heiress Nancy McCain. Although he told CBC that he would likely put his holdings in a blind trust, he didn’t do so.

Then he introduced a bill, C-27, that would make it easier for Crown corporations and federally regulated companies to shift from defined-benefit plans to shared-risk plans, a change he had sought when he was running Morneau Shepell, Canada’s “largest provider of pension administration technology and services.”

The opposition claims the firm would benefit from the bill, suggesting impropriety.

I doubt that Morneau introduced the bill to put money in his own pocket, but it’s not possible to discount the opposition allegations as baseless smears because Morneau was not forthcoming about his holdings, and the conflict-of-interest screen that is supposed to prevent him from handling any file that might affect his personal financial interests did not prevent him introducing a bill that he pushed for when he was a businessman.

Last week, he promised to establish a blind trust and sell off his remaining shares, but he has not said how he will do that. He could sell them to someone who promises to sell them back to him when he leaves politics, for example. He will no doubt clear whatever arrangement he makes with the ethics commissioner, but she is guided by a law, created by politicians for politicians, and it is full of loopholes.

The commissioner earlier advised Morneau that he didn’t need to establish a blind trust because of a loophole for numbered companies. Will he now find another loophole? Is there any point in asking him?

It’s a big mess, of Morneau’s own making, and because of that he’s under intense pressure to introduce good news on Tuesday.

After he failed to manage the public reaction to a proposal tightened rules for corporate tax shelters, the government hastily rolled out a small-business tax cut that will cost the treasury about $600 million a year, more than twice as much as he hoped to gain from closing tax shelters.

READ: Trudeau’s pandering small business tax cut will do nothing for the economy

Late Monday, CBC reported that the government will boost child benefit payments in the fall update. Goodness knows how much that will cost.

The window for doing hard things—like making politically difficult changes to the tax code—is closing as we get closer to the next election. Morneau, with his unforced errors, is squandering opportunities and forcing the government to spend money sooner than it had planned.

If he doesn’t stop blundering, it’s an open question how much longer Trudeau, or Canadians, can afford to have him in the job.