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Michael Wernick’s SNC-Lavalin problem

Andrew MacDougall: It’s not just the PM, politicians and staffers who are wearing the SNC-Lavalin affair. The PCO’s judgement is also on the hook.
Clerk of the Privy Council Michael Wernick, right, and Justice Department deputy minister Nathalie Drouin prepare to appear before the Standing Committee on Justice and Human Rights regarding the SNC Lavalin affair, on Parliament Hill in Ottawa on Wednesday, March 6, 2019. THE CANADIAN PRESS/Justin Tang

Andrew MacDougall is a London (UK) based columnist, commentator and consultant. He was formerly Director of Communications to Stephen Harper.

Michael Wernick has tasted social media and, by golly, he doesn’t like it.

Watching Wernick frantically wag the dog during his appearances at the justice committee hearings into SNC-Lavalin was certainly a meme-rable experience.

Most bureaucrats go out of their way to be deathly boring—it’s practically in their job description. (Nathalie Drouin, the Deputy Minister of Justice testifying alongside Wernick certainly got the memo.) Yet here was Canada’s top bureaucrat barking about political assassinations like he’d overdosed on Alex Jones videos. The crime would have been not to poke fun at it.

Wernick probably won’t want to read the reaction to his second go around at committee this week.

He started his sophomore turn by referencing his abuse on social media, calling it “intimidation”. He followed it up with an even more defensive appearance, bristling at every criticism, and doing absolutely nothing to help his or the government’s cause.

And it will do nothing to dispel his appearance as a partisan actor.

READ MORE: The Butts testimony: Have I mentioned the 9,000 jobs?

Indeed, most of the online attention Wernick received following his first appearance came when he started carrying Liberal water. Nobody—nobody—was better than Carolyn Bennett! You might not like Team Trudeau’s tweets but, gosh darn it, they mean well and they always—always—have Canada’s interests at heart.

Was it because Wernick secretly wears Liberal underwear? That was certainly the conclusion drawn in conservative corners of the commentariat (both informed and uninformed).

There might, however, be a less partisan reason for Wernick’s display, namely: the public service is also on the hook for SNC’s failed deferred prosecution agreement (DPA) gambit. It’s their judgment, too, that’s being called into question, not just that of the politicians and staffers involved. After all, SNC had been knocking on many political and bureaucratic doors about DPAs, and for a long time.

Trolling through SNC’s 357 lobbying registrations since 2008, a few patterns become clear.

Contacts between SNC and the Harper government were fairly regular, but never related to “justice and law enforcement.” Most of the contacts were to do with international trade, international relations or energy, what with Harper busy signing nuclear deals with countries like India.

Toward the end of the Harper era there were several contacts related to government procurement, perhaps an indication of concern over the Harper government’s changes its ‘integrity regime’,  which included a mechanism to bar businesses in legal scrapes—like SNC—from bidding on government contracts for up to 10 years.

As a former colleague puts it, the trade-off between SNC’s ethics and its economic value was an issue from the very start of the integrity regime under Harper. The difference, however, was that Harper was essentially willing to have the company held to account, no matter the scare story sold by SNC over its uncertain future. Harper wasn’t, in other words, the MP for Papineau.

Indeed, SNC’s campaign on justice and law enforcement only began in earnest once Trudeau assumed office. And while there still were frequent contacts with senior mandarins, the heavy focus was on the new minsters and their political staff.

In February and March of 2016, SNC met with senior political staff in the Prime Minister’s Office, Innovation, Science and Economic Development (ISED), Finance Canada, and Global Affairs Canada. Staffers met during that period include Mathieu Bouchard of the PMO (two times) and Elder Marques of ISED (three times), both of whom would later feature in the pressure campaign on then-attorney general Jody Wilson-Raybould in the fall of 2018.

SNC also met their local MP, rookie Liberal Marc Miller, whose constituency includes SNC-Lavalin HQ.

At no point, however, did SNC meet with Jody Wilson-Raybould or anyone from her office to discuss ‘justice and law enforcement’, undoubtedly due to its case being before the courts. SNC was aware of the bright red line between itself and the attorney general even if others later weren’t.

And what was achieved through all of this early mandate activity?

No one has said, but later that year SNC’s CEO Neil Bruce told reporters: “We know the federal government is examining the possibility [of deferred prosecution agreements].”

Left unsaid, however, was just how the Trudeau government would actually go about doing it.

After all, with a criminal prosecution before the courts, no politician with a measured respect for the law—even one elected on the island of Montreal—was going to publicly champion a change to the law that would so obviously benefit a company accused of such bad behaviour.

An adverse political reaction to the bad optics could explain why SNC’s lobbying campaign slowed to a virtual halt for the rest of 2016. Barring a few check-ins with senior bureaucrats at ISED, there is no activity on ‘justice and law enforcement’.

But 2017 got off to a busier start; a much busier start.

On Jan. 18, 2017, SNC met with Scott Brison at the Treasury Board Secretariat and new trade minister Francois-Philippe Champagne, before meeting with ISED Minister Navdeep Bains the following day. And there was another frantic day of meetings on Jan. 31, 2017, where SNC met with political staff from PMO, ISED, Global Affairs, Finance, and Environment, which also included a meeting with Catherine McKenna.

The push was back on.

And the push soon reached the very top of the Trudeau mountain: a Feb. 23, 2017, meeting with Gerry Butts, Justin Trudeau’s then-principal secretary. The subject, as ever: justice and law enforcement.

Parliamentarians had the chance to ask Butts about the Feb. 23 meeting with Bruce, but whatever was said appears to have reduced the temperature. SNC’s lobbying again switches to a lower frequency, albeit still featuring monthly catch-ups with Bouchard in the PMO (seven meetings between March and September), and occasional check-ins with other political staff across government, including Marques at ISED.

According to Bruce’s entry in the lobbying registry, SNC was still pushing for deferred prosecution agreements. Bruce’s registration also makes mention of “policy changes related to white collar crime” in the context of the 2017 federal budget. In other words, Bruce and SNC wanted any legal changes piled into the federal budget.

Tucked in amongst Bruce’s serial encounters with Bouchard in the summer 2017 are, according to the lobby registry, two meetings on ‘justice and law enforcement’ with powerful public servants: Paul Rochon, deputy minister of Finance; and Catrina Tapley, the deputy secretary to the cabinet at the Privy Council Office.

When asked why Tapley met with Bruce when Wernick had told the parliamentary committee he had gone out of his way to avoid SNC’s entreaties while their case was before the courts, the Privy Council responded that the registry was incorrect and that Tapley had not met with Bruce. Instead, the PCO says, Tapley met with Bill Pristanski, one of SNC’s lobbyists, on the day in question. (Pristanski’s registration also makes mention of ‘policy changes relating to white collar crime’ in the context of the federal budget.)

The PCO did not reply to a follow up asking why it was appropriate for Tapley to meet with one of SNC representatives given the situation with the courts.

By late that same summer, the federal government launched a public consultation on its integrity regime, including the possibility of including deferred prosecution agreements into Canadian law. The change wanted by SNC now had its chance to find broader support. And a few months later—and featuring a submission from SNC—the consultation concluded.

And then, as if by magic, a proposal for deferred prosecution agreements was buried into page 202 of the 2018 federal budget.

But if the lobbying activity by SNC before the budget was clear and systematic, its involvement in any of the public debate during the parliamentary consideration of the budget was far more opaque. As Maclean’s has reported, Ann Sheppard, senior counsel in the justice department’s criminal law section, declined to say when asked by MPs whether the change was made at the request of any one company. Sheppard replied that many groups, including “small and medium sized enterprises” wanted the change.

As expected, the budget omnibus bill eventually passed with ease, receiving Royal Assent on June 21, 2018

Omnibus legislation—i.e. kitchen-sink bills—are the public service’s favourite way of cleaning up ‘housekeeping’ items, i.e. the bits and pieces of government business that should be standalone bills but aren’t judged worthy of cluttering up the parliamentary calendar with debate.

Political staff also find omnibus bills useful vehicles into which to tuck in political fixes. Indeed, the Harper government turned omnibus legislation into sport, cramming budget bills full of pipeline legislation and other non-fiscal items. There’s a reason Trudeau campaigned on a pledge to end their use, arguing—with reason—the items in these legislative Frankensteins don’t get the proper scrutiny they deserve.

Despite Trudeau’s pledge to eliminate them, omnibus bills were still very much alive and kicking in 2017 and a potentially useful vehicle to a government looking to get a big conglomerate out of legal jeopardy without too much public scrutiny. And having grown accustomed to their use, the public service wouldn’t have shied away from the inclusion of dpas in a budget bill.

The DPA circle was now squared—and with barely any scrutiny. A little over two weeks later SNC met one last time—on July 5—with both Bouchard and Marques, the latter now also in the PMO.

All that was left was for SNC to be offered its deferred prosecution agreement. Only the offer never came. On Sept. 4, 2018, the government said it would not offer a DPA to SNC.

The shock must have been immense; to the company, to the political staff who took the dozens of meetings and to the bureaucracy that had done the same.

Whatever assurances were given to SNC at whatever level, nobody had counted on an attorney general impervious to the concerns of a major Quebec multinational. Or the concerns of her colleagues and their staffers, for that matter.

It is perhaps here—in failing to anticipate Wilson-Raybould’s principled refusal—where Wernick most spectacularly misjudged.

After all, Wernick knew Wilson-Raybould better than most, having been deputy minister at Aboriginal Affairs and Northern Development for most of the Harper government, a period which included the raucous Idle No More protests. Wilson-Raybould was at the time the Regional Chief of the British Columbia Assembly of First Nations, and is reported to have come away from the Harper-called, Wernick-driven 2013 Crown-First Nations Gathering heavily disappointed, with some citing it as the spark in her quest for elected office under the Liberal banner.

Was Wernick’s pointed praise of Carolyn Bennett a shot across Wilson-Raybould’s bow at the latter’s increasing criticism of the Trudeau government’s Indigenous policy?

Whatever the case, Wilson-Raybould’s refusal certainly seemed to light a fire under Wernick, who sprung into action quickly, finally accepting a meeting with SNC soon after the adverse decision from the director of public prosecutions came in.

Wernick was also quick to raise the issue with Wilson-Raybould, something he hadn’t previously done, joining a meeting between her and Trudeau that had been called on another subject the day before Wernick (and Tapley) were due to meet with SNC.

It was to be the first of a series of contacts from politicians and political staffers designed to get Wilson-Raybould to change her mind, a series of contacts that culminated in the ominous phone call between Wernick and Wilson-Raybould on Dec. 19, 2018, in which Wernick told the then-attorney general, according to her testimony, that her boss was in a mood to get the DPA with SNC done.

And while Liberals and Wernick were busy putting the squeeze on Wilson-Raybould in private, SNC was putting a public squeeze on the Trudeau government, taking out full-page ads in major newspapers to wonder why the government wasn’t doing its part to keep it from legal ruin.

“The Government of Canada passed legislation in 2018 to allow companies to settle charges via a remediation agreement,” the ad released in October said. “And yet the new law is not being made available to SNC-Lavalin for unknown reasons.”

But Canadians now know the reasons. Or rather, we know the reason: Wilson-Raybould. And the SNC ad can now be read as a company instructing the people it lobbied—both in the public service and amongst the political ranks—to make everything right by overruling that reason.

And now Michael Wernick is feeling the heat, with the NDP and Green Party calling for his resignation over his role in pressuring Wilson-Raybould. Or, as Wernick termed it, engaging in “lawful advocacy”.

The calls for his resignation certainly won’t be reversed on his most recent evidence. Wernick was skewered by Murray Rankin and Lisa Raitt, including a memorable sequence when Raitt had Wernick tied in knots over his admission that he accepted a phone call from Kevin Lynch, SNC’s chairman, after earlier saying contact with SNC would have been inappropriate. Raitt had the Clerk sucking and blowing.

Is Wernick guilty of being too faithful to his master? Or only of trying to make things work bureaucratically between the government and a major Canadian company?

We don’t know, but watching his second—equally unhelpful and arrogant—appearance, one gets the impression of a man feeling the heat over his performance and conduct. A person who has reached the pinnacle of the public service shouldn’t feel the need to table mean tweets and call them intimidation.

And yet, despite all the political damage Wernick has helped to inflict on Justin Trudeau, the prime minister might yet dance to SNC’s tune.

And by golly, Canadians won’t like it.

Andrew MacDougall is a London-based columnist, commentator and consultant at Trafalgar Strategy. He was formerly director of communications to Stephen Harper.