Here's to the crazy ones, the misfits, the rebels, the troublemakers, the
round pegs in the square holes... the ones who see things differently -- they're
not fond of rules... You can quote them, disagree with them, glorify or vilify
them, but the only thing you can't do is ignore them because they change
things... they push the human race forward, and while some may see them as the
crazy ones, we see genius, because the ones who are crazy enough to think that
they can change the world, are the ones who do.

Steve Jobs
US computer engineer & industrialist (1955 - 2011)

Sunday, April 27, 2014

Cathy Bennett's Smoke and Mirrors

There is something troubling about a politician that feigns to represent change, but yet defends their own self-interest as if it were that of the people. Cathy Bennett fits that description. For those that don't know her, Bennett's biography states she owns eight McDonald's franchises in the greater St. John's area, a partnership in Sunny Corner Enterprises in New Brunswick, and a partnership in Diamond Global International Recruitment Newfoundland and Labrador. She is also listed as having served, or serving, on a number of boards of corporations  - including chairing Nalcor Energy's board of directors. At first glance her CV seems to speak to a woman dedicated to the business of business. That's fine. However, Bennett has now entered elected politics here, and that's the business of the people.

Conflicts between her corporate held beliefs, and interests, and that of her position as a representative of the people in the province have been emerging for some time now. It began when she ran for the leadership of the Liberal Party here. As a Liberal supporter, I attended the first leadership debate in Gander. During the debate she reacted negatively to a proposal by one contender to implement a "fat tax" on fast food restaurants. It was quickly pointed out that she might be against such a proposal due to her McDonalds businesses. She was roundly assailed by the crowd when she attempted to defend the Muskrat Falls project. The feeling was that her association with Nalcor's board, and her role in advancing the project may colour her view - to put it politely.

She didn't win the leadership, but went on to run in a by-election in Virginia Waters district - which she won by 40 votes. Now, before she is even sworn in, Bennett finds her business interests in the spot light. Last week, Bennett came on live radio in the province to promote Muskrat Falls as the best thing since sliced bread, and a project that could not be stopped. There is a problem with that though. She was asked by the host if she had any business interests intertwined with the Muskrat Falls project. She said no. But that isn't quite the whole story. Bennett is partnered up with Sunny Corner Enterprises out of New Brunswick. Sunny Brook has bid and won seven contracts in 2013 with Nalcor Energy, including the lucrative ten year "Hydraulic Gates and Embedded Parts Program for Churchill Falls."

So, when Bennett speaks about Muskrat Falls, Nalcor, the Upper Churchill, and the like, it helps to know what her business interests are here. Incidentally, Sunny Corner Enterprises also has a large contract to supply the New Millennium mining project in Labrador during its construction - a mine that will need power from Muskrat Falls.

Getting past Bennett's obvious interests in Nalcor, etc, and into the scandal that's striking at her other enterprise - McDonalds. The hiring of foreign temporary workers by McDonalds, and their treatment/working conditions has made national headlines. The abuse of the program being a central issue. CBC Newfoundland and Labrador interviewed Cathy Bennett on the local side, given her ownership of the franchises here. During the interview, she is quoted as saying:

"I think it's important to remember this program is about people. I'm very comfortable that our company, and we as a company, have acted ethically and honestly as an employer... We always put people first and will continue to employ Newfoundland and Labradorians first."

In a twist to this story, that was not uncovered by the media, Diamond Global Recruiting lists as one of its clients McDonald Restaurants - meaning Bennett is involved with the recruitment and use of foreign temporary workers.

That changes things somewhat. First off, Bennett hasn't disclosed this according to the media interviews I've read and listened to. Secondly, Bennett's company may have a far deeper role in the temporary workers scandal than has come to light yet. What is clear, as in the other business relationships outlined here, is that Bennett routinely vigorously defends business projects and practices which she has a direct interest in, without disclosing the nature of her business interests on the topic.

That's troublesome. It may be okay to spin things like that in the business world to a degree, but when it comes to the world of public office, well that's different. In the public sphere a representative is supposed to be putting the interests of the public first, and declaring conflicts of interest. Has Bennett placed her businesses in a blind trust? Not that I've heard or seen. She strikes me not as something new, but rather something old. Sure she is new to the business club, sort of, but her actions appear to reflect the old. The Liberal Party needs to move into 2015 with a vision of fundamental change for the province. Not a change of actors, and not just a few "motherhood" statements, but real fundamental change. Accepting candidates like Bennett hurt, at the least, the perception that we can expect that type of change from the Liberals in 2015. That 's troubling. That needs to change dramatically before 2015. That change needs to be more than just words. It needs to be action. Creating a star candidate, or any kind of candidate, out of people who conduct themselves like Ms. Bennett has so far is damaging to that cause.

Friday, April 18, 2014

UPDATED Nalcor Energy, Fasken Martineau, PC Party of NL


After going through the records again, two further donations were found in 2007 by the Fasken Martineau firm. One was from Garfield Emerson for $1,000.00 to the PCs, and one was from a Fasken Martineau subsidiary named FMD Ontario Inc., Toronto, for $5,000.00 to the PCs. Which brings the totals for Fasken Martineau partners and companies up to $45,650.00.


Sometimes it's painful to do investigative work on the workings of our government in this province. It's painful because, no matter your political bent, you want to believe that things like greed and corruption are things that happen elsewhere, and not here. You want to believe that people in office have some standard of conduct, and it's just those with an ax to grind that throw mud at essentially good people. Then there is the reality - it's worse than we could possibly imagine. This post covers such a case.

Fasken Martineau (FM) first appeared on the Newfoundland and Labrador political donation scene in 2002, while the Liberals were in power. They made a one-time donation to the Liberal Party of $2,850. FM was involved with some minor contractual issues then respecting Newfoundland and Labrador Hydro, but nothing significant.

Then, in 2007, thing started to change. The Williams government began ramping up its strategic battle with Hydro Quebec - including numerous amendments to the Electrical Power Control Act. It was a very busy time. Concurrently, FM reentered the province's political scene. It was an election year, and suddenly a group of Quebecers became very interested in contributing to Newfoundland and Labrador politics, but only to one party - the PC Party. Now, the blog Labradore brought some attention to this at the time in a general sense, which included a comment from Danny Williams, then Leader of the Official Opposition, to the governing Liberal Party:

" Do you think it is appropriate that you should solicit and accept donations from someone with whom you are entering into negotiations to deal away the resources of this Province? Is that a conflict of interest? Do you see anything wrong with that? Because the people of Newfoundland certainly do."

Apparently times change, and with them values. The PC Party under Williams began accepting political donations, including direct general election contributions, not from the law firm of FM, but from its partners. At that time, and remaining the same today, corporate political donations in Quebec were banned. You had to be a registered voter in Quebec to make a political donation, and it had to go through a registered Party agent in Quebec. In any case, 2007 saw six partners of FM from the Montreal office make political donations to the PC Party:

Sylvie Bourdeau                 $ 500.00
Karl Dewaide                    $ 500.00
David Lemieux                  $ 500.00  (GE)  (Now with Norton Rose Montreal)
Xeno Martis                      $1000.00 (GE)
Allan Ranger                      $ 500.00  (GE)
Andre Turmel                    $1000.00  (GE)

Then in 2008 a similar occurrence:

David Lemieux                  $ 450.00
Xeno Martis                      $ 900.00
Robert Pare                      $ 900.00
Daniele Picotte                  $ 900.00
Allan Ranger                     $ 450.00
Andre Turmel                   $ 900.00

Just a note at this point. You will notice by these two years of donations that certain partners consistently make higher donations than others.

In 2009, and 2010 the donation pattern switched to corporate donations, with no partner donations to the PC Party:

2009 - Fasken Martineau  (Montreal)  $10,200.00

2010 - Fasken Martineau  (Montreal)  $  9,500.00

Then, in 2011, there were no donations by either FM or its partners. In 2012, the old pattern of donations resumed where the firm did not make donations to the PC Party, but the partners did:

Pierre-Olivier Charlebois         $    500.00
Andre Durocher                      $ 1,500.00
Ron Ezekiel                             $    500.00
Helmut K. Johannesen             $    500.00
Xeno Martis                            $ 1,500.00
Angela Onesi                           $    500.00
Daniel Picotte                          $ 1,500.00
Allan Ranger                           $ 1,500.00
Andre Turmel                         $ 3,450.00

The 2013 numbers are not public yet, and Elections Newfoundland and Labrador has not answered my email inquiring as to the date they may be released.

Here are the partners from FM involved with these donations:

To be clear, I have made written requests to FM, the PC Party of NL, and the Government of NL, Nalcor Energy and have not received any responses. I asked them to comment on the political donations. Here's why.
FM has been retained by Nalcor Energy for legal services. Not just any legal services, but the legal services surrounding the Lower Churchill project. The individual details of this service are confidential, but some parts are available for the public. Take this declassified confidential report from Nalcor regarding "3rd Party Vendors as of September 30, 2011:

This report states that Nalcor hired FM for: "Legal Services - strategic, Quebec regulatory, water management, Quebec civil, Ontario regulatory, PPA" and that it received from Nalcor for:

Muskrat Falls                   $1,111,174.23;

Labrador Island              $2,477,105.14; and 
Transmission Link

Total                              $3,588,279.37.

That was as of  the September, 2011. Then there was this: 

FM was the chosen law firm for the federal loan guarantee of $5 billion dollars for the Muskrat Falls project. The details of that contract have not been released by the government. However, it is interesting to note that Guy Giorno, of , former Chief of Staff to Stephen Harper until 2010, belongs to the same firm that is donating to the provincial government.
 Giorno most recently acted as counsel for Nigel Wright during the Senate expense scandal allegations and has just been announced as new legal counsel for the Conservative Party of Canada:

To top things off, we have Jacques Audette, a partner at FM being arrested by the Quebec anti-corruption squad in April 2012. 

Given the evidence that is in the public domain, it is clear and obvious that the law firm of Fasken Martineau (Montreal Office), and its partner were funneling political donations to the PC Party of Newfoundland and Labrador. It is clear they were under contract with Nalcor while doing so. It is clear they advised Nalcor on the water management agreement, and other issues solely relating to Muskrat Falls and the Lower Churchill. It is clear that conditions of the original loan guarantee, requiring no litigation be impending or undergoing regarding the Lower Churchill project be active, were tossed to the side when Stephen Harper suddenly agreed to wave all those conditions that would protect tax payers from massive losses from a Hydro-Quebec lawsuit (currently underway in Quebec) despite at least five separate lawsuits pending against the project. It is clear that Giorno is a very close confident of the Prime Minister. 

All these things are very clear and supported by evidence. What are the conclusions an average person could come to given these facts? 

1.   Fasken Martineau, and its partners were rewarding the PC Party of Newfoundland and Labrador for contracts they had secured with Nalcor Energy. It defies imagination the FM and/or a series of their partners in Montreal, Quebec, would suddenly become so enamored with a PC Party in Newfoundland and Labrador that they would donate to it while having contracts with the government, but not before that. The facts show a structured and repetitive donation schedule between partners that remains consistent to this day - or at least until the last released reports of 2012. Rewarding public officials or political parties for doing business with the government is a criminal offense
An investigation is required by the RCMP as to the seriousness of these contributions, but the evidence available publicly points to this.

2.   The PC Party accepted political donations from FM under these circumstances, and is subject to the same conclusion, and also requires an RCMP investigation.

3.  Perhaps most disturbing, although that is saying something, is the connection between the Prime Minister's Office, FM, Nalcor, the PC government of the province, and the loan guarantee. Given the sudden dropping of the lawsuit-free requirement of the original terms for the loan guarantee, and the sudden dropping of them by Stephen Harper (defying all logic and reasoning), and given the fact that FM was hired by Nalcor to deal with the water management agreement and the loan guarantee, the issue begs the question: Was the PMO influenced by Fasken Martineau partner, and now Conservative Party of Canada counsel Guy Giorno to drop the protection of the original terms of the loan guarantee which protected taxpayers? Was that influence exercised by way of paid lobby by Nalcor Energy? The evidence points in that direction, but requires an RCMP investigation.

What is clear through all of this is despite the PC Party's stand against Quebec, and the federal government, they had no problem taking their money and influence/advice under the leadership of the guy who said:

 " Do you think it is appropriate that you should solicit and accept donations from someone with whom you are entering into negotiations to deal away the resources of this Province? Is that a conflict of interest? Do you see anything wrong with that? Because the people of Newfoundland certainly do."
Danny Williams, Leader of the Official Opposition, 2002.

Whatever Mr. Williams said, these circumstances have been filed with the Quebec anti-corruption squad, and will form the basis of a formal complaint to the RCMP.

Saturday, April 12, 2014

Are Newfoundland Cabinet Ministers Guilty of Influence Peddling?

I'm starting this very serious post with a description on Section 121 of the Criminal Code of Canada. That way, you can judge the transactions of the noted Ministers of the Government of Newfoundland and Labrador yourself. It goes like this:

Frauds on the government
(1) Every one commits an offence who
(a) directly or indirectly
(i) gives, offers or agrees to give or offer to an official or to any
member of his family, or to any one for the benefit of an official, or
(ii) being an official, demands, accepts or offers or agrees to accept
from any person for himself or another person,
a loan, reward, advantage or benefit of any kind as consideration for
cooperation, assistance, exercise of influence or an act or omission in
connection with
(iii) the transaction of business with or any matter of business relating
to the government, or
(iv) a claim against Her Majesty or any benefit that Her Majesty is
authorized or is entitled to bestow,
whether or not, in fact, the official is able to cooperate, render assistance,
exercise influence or do or omit to do what is proposed, as the case may

(b) having dealings of any kind with the government, pays a commission or
reward to or confers an advantage or benefit of any kind on an employee
or official of the government with which he deals, or to any member of his
family, or to any one for the benefit of the employee or official, with
respect to those dealings, unless he has the consent in writing of the head
of the branch of government with which he deals, the proof of which lies
on him;

(c) being an official or employee of the government, demands, accepts or
offers or agrees to accept from a person who has dealings with the
government a commission, reward, advantage or benefit of any kind
directly or indirectly, by himself or through a member of his family or
through any one for his benefit, unless he has the consent in writing of the
head of the branch of government that employs him or of which he is an
official, the proof of which lies on him;

(d) having or pretending to have influence with the government or with a
minister of the government or an official, demands, accepts or offers or
agrees to accept for himself or another person a reward, advantage or
benefit of any kind as consideration for cooperation, assistance, exercise
of influence or an act or omission in connection with
(i) anything mentioned in subparagraph (a)(iii) or (iv), or
(ii) the appointment of any person, including himself, to an office;
(e) gives, offers or agrees to give or offer to a minister of the government or
an official a reward, advantage or benefit of any kind as consideration for
cooperation, assistance, exercise of influence or an act or omission in
connection with
(i) anything mentioned in subparagraph (a)(iii) or (iv), or
(ii) the appointment of any person, including himself, to an office; or
(f) having made a tender to obtain a contract with the government

Contractor subscribing to election fund
(2) Every one commits an offence who, in order to obtain or retain a contract with the
government, or as a term of any such contract, whether express or implied,
directly or indirectly subscribes or gives, or agrees to subscribe or give, to any
person any valuable consideration
(a) for the purpose of promoting the election of a candidate or a class or party
of candidates to Parliament or the legislature of a province; or
(b) with intent to influence or affect in any way the result of an election
conducted for the purpose of electing persons to serve in Parliament or the
legislature of a province.

Now, back in 2011, Minister Terry French came on province-wide radio to attack my integrity (for which he is now before the Courts), because I stated  his address to the PC Convention of October 2010, election readiness meeting, was illegal. If you don't know, this is what he said: "Don't be afraid to approach a contractor working on your roads, for a donation. They know where the contracts come from". Now, take a look at Section 2 above (Contractor subscribing to election fraud), and Section 1(a)(ii). Pretty clear is it not? This is against the law.

Then, back in December, 2011, I wrote an article on the Royal Newfoundland Constabulary . The RNC Association, made up of police members, (their web site has as their stated goal to " The goals and objectives of the RNCA are to improve benefits and working conditions for police officers..." To accomplish this mission, in part, the RNCA is spending considerable money buying tickets to PC fundraisers. Since I wrote that story on them in 2011, the RNCA has continued with this practice. In fact, this line appeared on the political finance report of the province for 2012:

"Royal Newfoundland Constabulary Association St. John's, NL 2,000.00 PC"

Aside from the provincial RNC Act prohibiting political activity, the Criminal Code of Canada Section 121 clearly prohibits this activity by officials, and people attempting to influence those officials, in this way.

Then there is the issue of political donations made by corporations that have contracts with the provincial government. Political donations by corporations in Newfoundland and Labrador are legal (Section 282 of the Elections Act That being said, it is not a blank cheque. Section 7.1 of the provincial Conflict of Interest Act states:

" Accepting extra benefits

7.(1) A public office holder shall not, directly or indirectly, accept a fee, gift or personal benefit, except compensation authorized by law, that is connected, directly or indirectly, with the performance of his or her duties."

In other words, as a politician, the only funds you can receive for doing your job is your pay cheque for doing your job. That brings us to this: political donations made to ministers of the provincial government of Newfoundland and Labrador. The following list is from the official record of political donations made to ministers of this government only. There are many cases where MHAs have also received similar donations. Ministers of the Cabinet have direct influence on the expenditure of public funds, and the establishment of spending priorities by the government - including individual projects as small as road paving, and as large as mega projects. They have direct influence and decision-making roles. The list of corporations, doing business with this government, and the ministers they donated to, in the 2011 general election, are as follows:

Air Labrador                        $2000.00     Patty Pottle;
                                            $  500.00     Derrick Dalley;

Atlantic Audio                     $ 1000.00    Kathy Dunderdale
Visual Inc

Atlantic Engineering             $  300.00     Joan Burke
                                           $5000.00    Tom Marshall
Atlantic Minerals Ltd.          $ 1000.00   Tom Marshall

Avalon Coal Salt Ltd          $ 1000.00    Tom Hedderson

BAE Newplan Group Ltd   $  500.00    Paul Davis
(SNC Lavalin)
                                           $ 500.00    Paul Davis
                                           $ 500.00    Steve Kent
                                           $ 1000.00  Derrick Dalley
                                           $ 1000.00  Terry French
                                           $ 1000.00  Clyde Jackman
                                           $ 1000.00  Jerome Kennedy

Bennett's Construction         $ 1000.00  Darrin King
and Supplies

Bluebird Investments Ltd     $ 1000.00  Susan Sullivan

Brad Roberts                      $ 2500.00  Jerome Kennedy

Brook Construction             $ 5000.00  Tom Marshall

David Bussey                      $ 2000.00  Jerome Kennedy

CBS Bus Lines                   $ 1000.00  Jerome Kennedy

Canada Fluorspar               $ 1000.00  Darrin King
Cold Ocean Salmon            $ 1500.00  Darin King
                                           $ 2500.00 Clyde Jackman
Coleman Management         $7500.00  Tom Marshall

Concord Paving                  $1000.00  Charlene Johnson
                                           $3000.00  Jerome Kennedy

Corner Brook Pulp and       $1000.00  Tom Marshall

Dr. G. E. Drogar PMC Inc  $1000.00 Susan Sullivan

Dr. King Jim PMC Inc        $ 100.00  Susan Sullivan

Dr. MS Boodhurn PMC     $  100.00 Susan Sullivan

Dr. Michael Cohen PMC   $  500.00 Susan Sullivan

Dr. Steven Parsons PMC    $ 1000.00  Susan Sullivan

Eastern Star Group Ltd      $ 3500.00  Derrick Dalley

Phillip J Davis                    $ 3500.00  Derrick Dalley

Emera Inc                          $ 1200.00  Shawn Skinner

Fairview Investments          $ 2800.00  Kathy Dunderale

Farrells Excavating Ltd       $  500.00  Clyde Jackman
                                          $1000.00  Terry French
                                          $2000.00  Tom Hedderson

Freak's Ambulance             $1500.00  Kevin O'Brien
Service                               $1500.00  Susan Sullivan

Fusion BPO Services          $1500.00  Susan Sullivan

Harris and Associates          $  100.00  Charlene Johnson
                                           $1000.00  Jerome Kennedy

Hearne Fougere Architects   $ 500.00  Clyde Jackman
Inc                                       $ 500.00  Joan Burke
                                            $ 500.00  Charlene Johnson                                           
                                            $ 500.00  Darrin King
                                            $1000.00 Jerome Kennedy
                                            $1200.00 Shawn Skinner
                                            $5000.00 Tom Marshall

J-1 Contracting                    $5000.00  Kathy Dunderdale

Johnson's Construction Ltd   $5000.00  Tom Marshall

Land and Sea Wielding         $2000.00  Jerome Kennedy

Malthius Canada Ltd            $1000.00  Paul Davis

Marine Contractors Inc        $5000.00  Tom Marshall

Marystown Shopping           $3049.00  Clyde Jackman
Centre Ltd (PQ)

Mercer's Ambulance            $2500.00  Derrick Dalley

Municipal Construction        $2500.00  Tom Hedderson

Nortech Construction Co    $1000.00  Derrick Dalley
Ltd                                     $1000.00  Clyde Jackman
                                           $1000.00  Darin King

Oram Group Inc                 $2000.00  Charlene Johnson

Pardy's Waste Management  $1000.00  Tom Marshall

Pennecon Limited                 $1000.00  Derrick Dalley
                                            $1000.00  Terry French
                                            $1000.00  Tom Hedderson
                                            $1000.00  Keith Hutchings
                                            $1000.00  Darin King
                                            $1000.00  Shawn Skinner
                                            $2000.00  Kathy Dunderdale

Penney Paving Ltd.               $1000.00  Tom Hedderson
                                            $2500.00  Susan Sullivan

PBH Group Inc (Stantech)   $1000.00  Joan Burke
                                            $5000.00  Darin King

Pinnacle Engineering Ltd      $1000.00  Kathy Dunderdale

Provincial Airlines Limited    $1000.00  Joan Burke
                                           $1000.00  Derrick Dalley
                                           $1000.00  Kathy Dunderdale
                                           $1000.00  Charlene Johnson
                                           $1000.00  Shawn Skinner

Provincial Paving Ltd.          $ 500.00  Keith Hutchings

Pyramid Construction Ltd    $ 300.00  Tom Hedderson
                                           $ 300.00  Keith Hutchings
                                           $ 300.00  Kevin O'Brien
Reliable Ambulance           $1500.00  Tom Marshall

RJG Construction Ltd        $2500.00  Darrin King

Ron Fougere Associates    $2000.00  Kathy Dunderdale

Terra Inns Ltd                   $2000.00  Kathy Dunderdale

The Brigus Production       $1000.00  Terry French

Tiffany Village                   $1000.00  Kathy Dunderdale

Western Petroleum           $1500.00  Jerome Kennedy
Newfoundland Ltd 

Western Star Trucks Ltd   $ 500.00  Susan Sullivan

This list does not include Ross Wiseman who received substantial like donations, but is now the Speaker of the House of Assembly.

Having studied the donation lists extensively over the last year, I have some observations:

1.    It appears that the more influence the Cabinet Minister has within the government, the more and the     higher the donations from corporations that have contracts with the government;

2.   There are numerous cases where the Minister responsible for a department is actually receiving direct political donations from a company that deals directly with her or his department, for example - Hedderson in Transportation and Works getting donations from excavation, construction and paving companies - Sullivan in Health Care receiving donations from doctors - etc;

3.  Donation from corporations with live bids on the Muskrat Falls contract - for example Coleman Management Services (owned by current PC Party Leadership candidate Frank Coleman) to current interim Premier Tom Marshall;

4.  Ordinary MHA's of the government receive almost nothing in donations from corporations with government contracts, relative to the Cabinet Ministers - which implies there is an order of donation based upon influence within the government;

5.  Corporate donations to Cabinet ministers of the government is rampant among smaller industries dependent on government money - ambulance services; funeral homes, seniors homes, school bus companies, the aqua culture industry, etc. Most of those donations have not been recorded here as they receive grants from government, but do not necessarily have a contract for supply with the government; and

6.  Almost no members of the Liberal or NDP parties received donations from these companies - although a few, small donations were made.

Total corporate donations from companies, doing business with the government, to Cabinet Ministers in the 2011 general election:

Tom Marshall         $37,000.00
Kathy Dunderdale  $15,000.00
Jerome Kennedy    $14,000.00
Derrick Dalley       $14,000.00
Darin King             $13,000.00
Clyde Jackman      $10,500.00
Susan Sullivan        $ 9,700.00
Tom Hedderson     $ 8,800.00
Shawn Skinner       $ 4,800.00  (subsequently defeated)
Charlene Johnson   $ 4,600.00
Terry French          $ 4,000.00 
Joan Burke            $ 2,800.00
Patty Pottle            $ 2,000.00  (subsequently defeated)
Paul Davis             $ 2,000.00
Kevin O'Brien       $ 1,800.00
Keith Hutchings     $ 1,800.00

This post is written to inform the public on a matter of public interest. It is written to inform those that were unaware. It is written to change what needs to be changed in our province, for the benefit of the people of the province. It is written to uphold the law. As it stands now, these issues need investigating by the Special Branch of the RCMP. Until the issue is investigated, and if people are charged, and if they are convicted, then these observations remain just that.  



Saturday, April 5, 2014

Buses, Middlemen, and Politicians

This post is the first in a series of posts on corruption in the government of Newfoundland and Labrador.

In 2003 the Newfoundland and Labrador School Bus Operators Association (the Association) was formed as a professional association. It never achieved full membership, and today it actively represents about 15-20 of more than 85 private school bus companies in the province. Last week, in an act of bravery in this province, Dave Callahan (a school bus operator) openly exposed this story on province wide radio. The story goes like this:

The Association submitted a brief to the provincial government on issues relating to regulations and standards applied to school buses. The condensed version of the brief is that provincial regulations would force school bus operators to buy new school buses, at a price of about $120,000, rather than purchase well maintained used buses for half the price. For example, if an operator were to buy a bus without a stop arm on it, he could not have one installed. Instead, he would have to buy a new bus with one installed at construction of the bus. Other examples include decals and the like.

The bus operators explained to the government that they could not possibly stay in business if they had to buy new buses, because rates paid to them would not reflect that cost. For example, in the 1980's bus operators were paid $30,000 per run for busing children to school. Thirty-four years later, in 2014, that rate was $50,000. However, the cost of a new bus in the 1980's was about $50,000. Today it is $120,000. The bottom line is the government is imposing requirements on the bus operators, but not offering the rates so they can meet those new requirements - hence driving them out of the business.

It's against this backdrop that in 2012 the Association decided to get more politically involved in resolving their problem. Here is a quick history of the two Association members involved:

Clarence Gosse: Owns CB Bus Lines. Sat on town council in Spaniard's Bay in the 1990's. Ran as a provincial PC candidate under Danny Williams in the 2003 election. Known locally as a Tory "bagman" (fundraiser). Frequent financial contributor to the PC Party, including a $1000.00 donation to Jerome Kennedy's election campaign in 2011. Paid for two tickets to a PC Party fundraiser in 2012 for himself and Kerry Noel.

Kerry Noel: Owns Noel Motors and Transport. First cousin of Peter Noel. Peter Noel was: Chief of Staff of the Official Opposition (PC 2000-2003); Principal Assistant to Premier Danny Williams 2003-2007; Senior Advisor - Tourism,Culture and Recreation; and one of Dunderdale's last appointments - Private Secretary, Office of the Lieutenant Governor.

With the failure of their proposal to the government, Gosse and Noel were told by Jerome Kennedy to attend a $100 per plate PC Party fundraiser, at which they would be afforded time to meet with Ministers Jackman (Education) and Davis (Transport and Works).

After the fundraiser, Gosse approached Noel with a list of three names as possible "lobbyists". The person chosen was Robert W. Lundrigan. Here is Lundrigan's history:

Robert Lundrigan: Retired school principal; Resident of Spaniard's Bay; Past PC Party President (2003); past PC association President Port de Grave; and appointed by Danny Williams as Chief Review Commissioner Workplace and Health (2007). Most recently involved with the failed election campaign of Jack Harrington (who was the Executive Assistant for Jerome Kennedy).

Robert Lundrigan was also (until very recently) spokesperson for the private development known as Veterans Development Park - Phase I Inc. - a 210 acre business park development at Spaniard's Bay by Brad Roberts Developments (recently taken over by another entity). Lundrigan and Brad Roberts Developments were also contributors to Jerome Kennedy's re-election bid in 2011 ( Brad Roberts Developments to the tune of $2500.00).

After the fundraiser,  $10,000.00 was offered to Gosse and Noel to help hire a "spokesperson-lobbyist" by Minister Kennedy. The Association was expected to come up with its own money to top that off. When Lundrigan quit he claimed to be still owed $34,000.00.

So, to sum up the transaction part of this affair, two men with some political connections to the PC Party were told to attend a fundraiser for the governing party, to get a resolution for their contract dispute. Three Ministers of the governing party then met the two men, and spoke about resolving their contractual issue at the party fundraiser. The one man, who donated $1000 to Jerome Kennedy's campaign, came back with a list of three names. The name chosen was a man who assisted in the campaign of Jerome Kennedy's former EA, and was spokesman for a company that had donated $2500.00 to Jerome Kennedy's campaign. Minister Kennedy volunteered $10,000.00 of taxpayers money to pay this man to lobby himself ("himself" in the context of his government). I think I have that straight now..

Going through this affair, step by step, it appears to be a  case of influence peddling. There is no reasonable purpose for a Minister of the Crown to request a "lobbyist-spokesman" be appointed by an Association that has already submitted a detailed report on its position. Its position was well known and well explained. There is no reasonable excuse for using taxpayers money to fund such a person - in effect the government is funding someone to lobby itself. Then there is the clear, unmistakable political flavour. It quite clearly appears as a scam by the government to reward a political friend with a plum job, with the premise that his hiring might actually achieve something. Then, of course, there is the requirement that that two men buy tickets to a governing party's fundraiser to get an audience with three ministers.

Is all of this legal? The Criminal Code of Canada states:

 Contractor subscribing to election fund

(2) Every one commits an offence who, in order to obtain or retain a contract with the
government, or as a term of any such contract, whether express or implied,
directly or indirectly subscribes or gives, or agrees to subscribe or give, to any
person any valuable consideration
(a) for the purpose of promoting the election of a candidate or a class or party
of candidates to Parliament or the legislature of a province; or
(b) with intent to influence or affect in any way the result of an election
conducted for the purpose of electing persons to serve in Parliament or the
legislature of a province.

Here are Minister Jackman's words from an interview with the Telegram on April 2, 2014:

Education Minister Clyde Jackman brushed aside allegations Tuesday that a private lobby group was pressured to buy tickets to a PC Party fundraiser in order to get a meeting with him.
He said that interest groups come to party functions all the time, and it often leads to meetings with him, but that doesn’t mean he’s pushing people to do it.

“It’s up to individuals what tickets they buy and what events they go to,” Jackman said. “I’ve been to numerous events where people 
have approached and discussed certain issues, 
and we’ve set up meetings afterwards, Mr. Speaker, 
and I will do this with this group as 
I’ve done with many other groups.”

“All this seems very suspicious: a former PC party president hired on the advice of a senior PC cabinet minister to lobby his own government all through the use of public funds provided by the minister of education,” Liberal MHA Dale Kirby said. “So I ask the minister: how do you justify using your department’s funds to pay a high-level PC Party member to lobby you about school transportation?”
Jackman countered that the government only gave a $10,000 grant, but the Newfoundland and Labrador School Bus Operators racked up $36,000 in lobbying fees, so the taxpayers didn’t cover all of it.
What Jackman doesn't understand, somehow, is that it is illegal to do so when it comes to a government contract or the "transaction of business relating to the government".

Then there is this:

Frauds on the government

121. (ii) being an official, demands, accepts or offers or agrees to accept
from any person for himself or another person,
a loan, reward, advantage or benefit of any kind as consideration for
cooperation, assistance, exercise of influence or an act or omission in
connection with
(iii) the transaction of business with or any matter of business relating
to the government, or

Requiring (and actually partially funding) a middleman to represent an association, that already is the elected representative for its membership, in order to "influence" or "assist" in the details of a government contract is illegal.

Then there are the multiple political layers on top of all this. In my opinion, and I believe the law is very clear on this, and in taking the evidence provided by the association members and others that aren't members, this government has broken the corruption laws of Canada. The RCMP need to investigate this matter. This is one, very public example of corruption within our government. In the coming weeks, there will be many outlined here on this blog.