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April 11, 2005
Corruption Moves Past Gomery, Involves Martin Confidants

In a sign that the reformist mood has gained momentum in Ottawa, two close confidants of Prime Minister Paul Martin have been subpoenaed to testify to a Commons committee to review contracts awarded to research firms with close ties to Martin. Two other reluctant witnesses have also been subpoenaed, along with Allan Cutler, one of the Adscam whistleblowers who will testify voluntarily:

Four reluctant witnesses including two close confidants of Prime Minister Paul Martin will be subpoenaed by a Commons committee investigating research contracts awarded to a consulting firm closely allied with Mr. Martin. ...

Among the targets are Terrie O'Leary, who was chief of staff to Mr. Martin when he was finance minister, and David Herle, co-chairman of the Liberal campaign in the last election.

Also subpoenaed will be Warren Kinsella, a former Jean Chrtien loyalist who has been critical of Mr. Martin in the past, and former Finance Department official Peter Daniel.

At issue are public opinion research contracts that went to Earnscliffe Research, a firm that employs many long-time Martin associates. The contracts were awarded when Mr. Martin held the finance portfolio in the Chrtien cabinet.

The deals have been mentioned in testimony at the federal sponsorship inquiry. But Justice John Gomery ruled they we not within the mandate of his commission, prompting the public accounts committee to take up the issue.

The four will appear on April 18 after stalling and making excuses, of which the Commons finally tired. The timing could not be worse for Paul Martin, as he just got done insisting that he still retained the "moral authority" to continue as PM. Thus far, the Gomery inquiry has focused much more on ties to former Liberal PM Jean Chrtien, which will do enough damage to Martin's standing as it is, considering that Martin was Finance Minister and should have been responsible for ensuring that government funds were spent correctly.

However, if this new line of inquiry produces any new evidence of corruption or influence peddling, Martin will not be able to deflect the connection to his former leader. Earnscliffe Research apparently employs a number of people connected directly to Martin, and if they received government funding either for work not accomplished or outside of normal bid processes, then Martin will have been directly implicated in malfeasance. That's certainly been the allegation; last year, upcoming Gomery Inquiry witness Chuck Guit told a Commons hearing that a certain minister made sure that bids fit only one company to ensure their award to cronies:

In Friday's testimony, Guite maintained some cabinet ministers interfered with the awarding of government contracts.

"If the minister's office suggests, sends memos, prepares a scope of work designed to fit one company ... it's interfering in the process."

The retired bureaucrat said Paul Martin's former chief of staff, Terrie O'Leary, pushed Earnscliffe Research and Communications to be included on a list of companies eligible for government contracts.

Earnscliffe Research received $1.8 million in contracts from the Finance Ministry while Martin ran it under Chrtien's government, from 1993 to 2002. Some describe the firm as the sole supplier of Finance's communications needs during that period of time, a particular run of good luck in the bidding process if true. According to a 2002 article in Vigile, this issue has percolated for some time, only surfacing now with Adscam exploding onto the Canadian consciousness. The two cases have a passing resemblance, as this remark by then-ethics watchdog Howard Wilson shows:

While he wouldn't say the company should be banned from doing work for the department, Mr. Solberg said that's "definitely one of the options" Mr. Wilson should consider. He said there's little difference between the situation with Earnscliffe and that involving Mr. Palmer.

Unlike Mr. Palmer, Mr. Martin's supporters at Earnscliffe are not known to have been raising money for the minister's leadership campaign. But Mr. Solberg said it could be argued that the contracts given to Earnscliffe help to pay people who then offer their campaign services to Mr. Martin for free.

"It is almost the same thing, whether you actually go and raise money or you simply work for free in order not to have to expend money for positions that they would otherwise have to pay for. In a way, it is the same sort of thing."

That's the exact same scam that Jean Brault enabled for the Liberals at Groupaction, according to his own testimony. Any corroboration of similar connections between Martin and Earnscliffe in the Commons hearing, and the excuse that the Liberal corruption came from the Old Guard will collapse completely -- probably right along with the current government.

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Posted by Ed Morrissey at April 11, 2005 8:50 PM

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Martin had his "I am not a crook"/"no controlling legal authority" moment as he claimed he retained the "moral authority" to govern. [Read More]

Tracked on April 12, 2005 10:15 AM

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