Minister says she was not directed by PMO in suggesting WE Charity run student grant program

CTV National News: 'Devastating what's ending' CTV News Chief Anchor and Senior Editor Lisa LaFlamme spoke with WE founders Craig and Marc Kielburger in an exclusive interview.

OTTAWA — Youth Minister Bardish Chagger says that the Prime Minister’s Office did not direct her to suggest that WE Charity run the now-halted summer student volunteer grant program, which MPs learned on Thursday evolved from a WE Charity proposal made to the government in April.

Chagger doubled down on the federal government’s assertion that it was the public service that suggested WE Charity run the summer student volunteer grant program, naming the senior assistant deputy minister in the Employment and Social Development department Rachel Wernick as the official who advanced the suggestion.

“I was not directed by the Prime Minister's Office,” Chagger said. “It’s something we turned over to the public service as to how can we deliver this program… They made it a recommendation that WE Charity would be the organization able to deliver this program within the timeline needed, with the scope and scale and magnitude that we were desiring,” Chagger said.

Chagger was the first to testify on the controversial sole-sourced contract—which she disputes it was a contract at all, calling it instead a “contribution agreement”—during the first meeting of the House Finance Committee study into the Liberal government’s connections to the charitable organization.

In the first round of questioning the minister told MPs she personally did not have conversations with Prime Minister Justin Trudeau or Finance Minister Bill Morneau’s offices about the plans to outsource the administration of the program to WE Charity, which both Trudeau and Morneau have close personal connections to.

“I was given a recommendation by the public service, I accepted the recommendation… and I brought it forward to cabinet,” Chagger said.

She also emphasized that the COVID-19 pandemic played a role in shaping the way federal programs were being developed and executed.

Trudeau unveiled the program as part of a $9-billion student-focused COVID-19 aid package on April 22. It took two months for the details of the grant aspect of the package to be articulated.

Chagger told MPs that of the $912-million program, $19.5 million was the operating budget for the program—all of which has been returned to the government after WE Charity backed away from running the volunteer program.

She also said that the program was intended to be enhanced, meaning an additional $13.5 million could have been given to WE Charity for an additional 20,000 placements if the demand was there.

“The maximum amount WE Charity could have received was $43.53 million out of the total budget… The vast majority of the money was for grants that would have been issued by one-time payments for students to pay for their post-secondary education costs,” Chagger said.

PROGRAM EVOLVED FROM WE PROPOSAL

On Thursday MPs began hearing from the first group of witnesses on the program rollout, how it came about, and who was involved.

A slate of senior public servants from the Canadian Heritage and Employment and Social Development departments—who the Liberals say were the ones to suggest WE Charity take on administering the $912-million Canada Student Service Grant—testified, including Wernick.

During her testimony the senior public servant said that when her team was asked in mid-April to provide options for some form of a student service program, other charity groups were considered early on, but there was no formal open bid for pitches, and other than WE Charity none of the options met all the criteria needed to take on the program.

She cited experience delivering similar programs and a direct connection to Canadian youth as two benefits of going with WE Charity.

Wernick called WE Charity an “obvious option,” noting that WE Charity—which is co-founded by Craig Kielburger and Marc Kielburger—had already reached out to unspecified members of cabinet and government officials proposing they work with the government on a program “related to social entrepreneurship for youth.”

According to Wernick, WE Charity indicated their program proposal could be adapted as needed.

She said she called WE Charity on April 19 to discuss their prospective involvement, and then on April 22, the day Trudeau announced the program Wernick said that the organization sent her “a detailed proposal to quickly develop tens of thousands of volunteer placements for youth within a few weeks.”

“Given the need for speed and scale, I determined with my team and colleagues that their draft proposal was the best available option in the time we had to work," she said, noting that after April 22 no other groups reached out to indicate they’d be interested in delivering the Canada Student Service Grant.

WE Charity and the government then entered into talks about the "contribution agreement" in mid-May and Wernick said that any activity the organization did to recruit or set up volunteer placements prior to the late June launch of the program were taken "completely" at the charity's risk.

The aid program, meant to offer students $1,000 for every 100 hours of volunteer time they spent helping out on COVID-19-related efforts, was put on pause after WE Charity backed out after coming under fire for its own internal issues as well as what critics say is a clear conflict of interest within the Liberal government.

Both Morneau and Trudeau have apologized for their part in the controversy and vowed to recuse themselves from any WE Charity discussions in the future, though federal Ethics Commissioner Mario Dion is now conducting separate probes into both Trudeau and Morneau’s dealings in relation to the WE Charity contract.

While the government has vowed to rework the program as quickly as possible, and is looking internally to government departments and agencies as possible venues for running the program, thousands of students have been left in limbo midway through the summer.

One of the key intentions with this committee study, according to the opposition parties who used their majority on House of Commons committees to launch the investigation, is to dig up as much detail on who knew what and when, in relation to how the WE Charity student grant deal came about. It’s also likely officials will be questioned about other past contracts with WE and the extent of the Liberals’ connections to the organization.

“Federal government proactive disclosures show that the Canada Student Service Grant is not the beginning of WE Charity’s dealings with the federal government. Government records confirm that, since 2017, WE Charity has received seven grants or contributions totalling about $5.2 million, plus another five contracts,” wrote Conservative MP and ethics critic Michael Barrett in a letter sent to the RCMP suggesting a criminal probe into the matter.

TRUDEAU TO TESTIFY?

Another key intent of the opposition parties is to have Trudeau testify before the committee. While MPs have invited him to appear, he is not compelled to do so. When asked if he would appear at the request of MPs, Trudeau has said he’d consider it.

Facing new questions about the affair on Thursday during an unexpected press conference just minutes before the committee got underway, Trudeau said his government would be “transparent” about the deal, but wouldn’t commit to testifying.

The purpose of bringing the prime minister before the panel of MPs would be to extract more details around his family’s connections to the charity group.

Trudeau's mother, Margaret Trudeau, spoke at approximately 28 WE events and was paid $250,000 in speaking honorariums between 2016 and 2020. His brother, Alexandre Trudeau, also spoke at eight events from 2017 to 2018 and was paid a total of approximately $32,000.

Over $60,000 of that money, which is typically doled out by corporate sponsors, was paid directly to Margaret Trudeau by the charity as the result of what WE Charity referred to as an "error" in billing and payment.

In addition to this, Trudeau's wife, Sophie Gregoire Trudeau, received a "one-time speaking honorarium" of $1,400 for participating in a youth event in 2012 before Trudeau became leader of the Liberal Party. She is an ambassador with the organization and continues to host a mental health podcast under its name.

In making his apology earlier this week, Trudeau said he was aware his family members worked with WE but he didn’t know the details of how much they were getting paid.

“I should have and I deeply regret that,” Trudeau said on Monday.

Late Wednesday We Charity announced its plans to undertake "governance and structural changes" and a "formal organizational review.”

Asked Thursday about how much she knew about the prime minister’s connections, Deputy Prime Minister Chrystia Freeland said everyone in cabinet “bears responsibility for the situation.”

“I'd like to say, speaking for myself, that I accept that responsibility, and I very much regret what has happened. And I want to say to Canadians: I'm really sorry. We have so many huge issues facing our country, clearly, our government made a mistake, and I want to say to people: we're going to learn from it.”

With files from CTV News’ Rachel Gilmore