Liberal ties not the reason for WE deal: co-founders

Craig and Marc Kielburger, the co-founders of WE Charity, are denying that close ties to Liberal politicians had anything to do with their organization being awarded the contract to administer a now-halted $912 million student volunteer grant program.

The pair appeared before the House of Commons Finance Committee on Tuesday where they opted to testify under oath as part of an hours-long hearing about their involvement in the controversy embroiling the federal Liberal government.  

“We did this to be of service to the government, and not for the government to help us,” Craig Kielburger told the committee, repeatedly asserting any early action taken by WE was because they were eager to get going on the program and not because they had received advanced information from the federal government. 

The pair noted that the charity has worked with Conservative and NDP politicians in the past, and emphasized that the student grant program was developed in the midst of the COVID-19 pandemic, appearing to echo past public service testimony about the altered way massive government programs were being conceptualized and executed. 

The WE Charity has come under considerable scrutiny over the last month, after Prime Minister Justin Trudeau announced the organization would be running a program offering payments to students for summertime volunteer work on COVID-19-focused community programs. 

  • Scroll down or click here to recap our live blog of the Kielburgers’ testimony
  • Reading on an app? Tap here for full experience

Facing questions over their internal affairs and conduct, as well as the possible conflict of interest Trudeau was in, given his family’s connections to the charity, WE backed away from the program, leaving thousands of students waiting to see the federal government’s plan B, after asserting WE was the “only” group capable of executing the Canada Student Service Grant. To run the program, WE was set to receive $43.5 million.

Despite the program budget being $912 million, testimony has indicated that unless it needed to be scaled up due to increased demand, just $500 million was expected to be spent on student grants.

All of the funding to WE directly was to be used in running the program and not to be kept as profit, and the brothers told MPs that they estimated the true cost of the program would be less than the entire budget offered, given they didn’t anticipate many students hitting the maximum $5,000 grant level, which would have required 500 hours of volunteer work.  

The program was first revealed by Trudeau on April 22, as part of a $9-billion student support package. WE Charity was announced as the group to run it in late June. Prior to that, WE was already being discussed behind the scenes as an option to run the program after assistant deputy minister with Employment and Social Development Canada Rachel Wernick suggested the group, given WE had already submitted an unsolicited pitch for a student entrepreneurship program.

QUESTIONS ON PAST DEALINGS 

New documents and details continue to cast new light and prompt further questions about how the agreement for WE to helm the program came, with voices from inside the charity sector and parliamentarians questioning whether there was more to why the charity appeared to have the inside track on getting the contract.

The brothers agreed to a four-hour committee appearance, and faced a series of questions on the timing of WE’s various talks with senior public servants and cabinet ministers about the student grant program, the past contracts the organization has been awarded by the federal government, as well as the personal experiences with the political figures at the centre of the ongoing controversy.

They were also asked about WE Charity’s financial structure and real estate holdings, and have sought to clarify the different initiatives included under the WE brand.

“Some have suggested that WE Charity was in dire financial straits prior to the CSSG and that somehow motivated our actions. It simply isn’t true,” said Craig Kielburger, noting that the fallout the charity has experienced—including several companies cutting ties—has “resulted in serious challenges that risk the entire organization and 25 years of work.”

He said that they would have never picked up the phone when the civil service came calling if they knew the consequences, both for their organization and for the students who were banking on these placements.

Asked by Liberal MP Annie Koutrakis whether the money WE would receive to run the program would in any way be a kickback for payments made to Trudeau or Morneau’s family, Craig Kielberger said that is not a true representation of what took place, despite what some opposition MPs have sought to infer. 

The brothers, who founded the charity in 1995, have said they welcomed the opportunity to “set the record straight” about what’s been written and said about WE Charity in recent weeks. 

WE has already announced plans to undertake "governance and structural changes" and "return to its roots."

As part of this plan, the charity says it will undertake a "formal organizational review" and cancel all WE Day events for the "foreseeable future."

NEW DETAILS ON SPEAKING FEES

Michelle Douglas, WE Charity's former chair of the board of directors, testified just prior to the co-founders. She told MPs that her late-March resignation was the result of inadequate transparency about financial and employment decisions.

In her testimony Douglas spoke about the differences between WE Charity and the We Charity Foundation, which was the name on the contribution agreement awarding the organization the student grant program. Douglas said that she did not know that the Foundation was operational, though WE has said the decision to put the deal under the Foundation’s name was related to the financial liability the charity would be taking on to execute the government grant program.

Douglas also testified on Tuesday that the brothers had made it clear that WE Day speakers were not paid.

This raised the eyebrows of some committee members, given that 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.

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.

Not all of the events that the Trudeau family took part in were WE Day events and the majority of them were unpaid, according to the Kielburgers, though the Trudeaus were also reimbursed for direct costs, the brothers told the committee.

They also said that over the years Sophie Gregoire Trudeau had participated in a total of seven WE Days and received an average of $3,618 per event to cover her expenses.

The House of Commons Ethics Committee has requested access to the Trudeau family’s past speaking contracts to assess further when they’ve done paid appearances. The Kielburgers have also committed to presenting the committee with additional documentation, including text and email communication with the various ministers and their offices that the charity engaged in in relation to the student grant program. 

POLITICAL CONTROVERSY CONTINUES

In the meantime, the political scandal continues to develop, with last week’s committee testimony from Finance Minister Bill Morneau revealing that he and his family have taken trips with WE that Morneau had just fully reimbursed them for to the tune of $41,000, and that his wife has given the group $100,000 in donations in recent years.

Already, the federal ethics commissioner had launched investigations into possible conflict of interest code breaches by Morneau and Trudeau for not recusing themselves from the cabinet discussions about outsourcing the grant program to WE, given Trudeau’s family members have received speaking fees from the group and Morneau’s daughters have worked with WE.

Both Trudeau and Morneau have offered apologies and pledges to be more proactive in recusing themselves going forward, though that’s far from enough to quiet the opposition, with the Conservatives and Bloc Quebecois calling for both Trudeau and Morneau to resign or risk facing a confidence vote and possible snap election this fall.

Trudeau and his top aide, chief of staff Katie Telford, are slated to follow the brothers’ testimony with their own on Thursday.

Testimony at a parliamentary committee from a sitting prime minister is rare. The last time it happened was more than 10 years ago in 2006, when then-prime minister Stephen Harper appeared before a Senate committee to discuss Senate reform.

With files from CTV News’ Rachel Gilmore  

 

 

SIGN UP NOW

Stay up-to-date and in-the-know by subscribing to one of our newsletters