Advertising contract scandal could bring down Canadian government

April 22, 2005

"Those who are in power are to be held responsible, and that includes me," Canada's Prime Minister, Paul Martin, told his nation in the first live address by a PM in ten years. "If so much as a dollar is found to have made its way into the Liberal Party for ill-gotten gains, it will be repaid to the people of Canada." 

Conservative Leader Stephen Harper described Mr Martin's broadcast as "a party leader playing for time, begging for another chance".

"After the Prime Minister has shut down the democratic process here ... my guess is there will be more people that are calling for some accountability, perhaps in the form of an election," New Democratic Party (NDP) leader Jack Layton said.

A series of opinion polls show that in an election held today, a minority Conservative government would probably result, reports The Australian.

Auditor General's report
Outrage over the advertising kickback scandal &mdash; known as AdScam &mdash; has been fomenting since it was uncovered in 2002, according to an article by Associated Press, and an Auditor General's report released in early 2004. Already it has been attributed as one cause of the Liberal Party loss-of-majority in Parliament, after federal elections last June.

That report found that shortly after defeat of a 1995 separatist referendum in Quebec, millions of dollars from a government federalism advertising campaign in Quebec had been directed to specific advertising firms, friendly to the Liberal Party, reports the Associated Press.

Gomery federal inquiry
Since a publication ban was lifted two weeks ago, on federal inquiry testimony by a Montreal advertising executive who faces fraud charges over the scandal, revelations have "been more politically explosive than previously expected", to quote Canada's CTV News.

And the opposition has been trying to draw links to Martin, who was finance minister at the time of the sponsorship program currently being examined.

Advertising executive Jean Brault told Justice John Gomery's federal inquiry that senior Liberals made him secretly divert more than $US818,000 to the party's Quebec wing in exchange for sponsorship contracts, reported The Australian.

Bloc Québécois Leader Gilles Duceppe said the revelations had tarnished Quebecers, reported CTV News.

"The Liberal Party said it wanted to promote federalism. But in reality the Liberals tried to buy the soul of Quebecers," said Mr Duceppe.

PM Martin's actions over the scandal
For his part, although Mr Martin testified to the commission, according to the Associated Press report, he has not been implicated.

In his speech to the nation, he emphasized his own efforts such as canceling the sponsorship program on his first day in office as PM, firing from a diplomatic post Alfonso Gagliano, the man who had been minister responsible for the program, ordering the current inquiry and an audit of Liberal Party financial records, and bringing in a raft of whistleblower-protection legislation.

He had also brought lawsuits related to the scandal, on 19 people and companies for more than $40 million.

Activities date back to the 1990s and the Liberal leadership of former prime minister Jean Chrétien, who has also denied any knowledge of wrongdoing, according the report from The Australian.

Election timing
"I commit to you tonight that I will call a general election within 30 days of the publication of the commission's final report and recommendations," Mr Martin told Canada in his address.

Justice Gomery is due to deliver his report in December, meaning an election in January 2006.

Mr Martin said he wanted Canada to have the report before an election was held.

"There is conflicting testimony; only the judge is in a position to determine the truth. Only he can cut through the partisan politics. Only he can tell us what happened and who was responsible."

But, "If the Opposition forces an election before then, that is their choice," Martin said.

"I will never hesitate to describe what happened on the sponsorship file for what is was - an unjustifiable mess. It's up to me to clean it up. That's my job. I am cleaning it up. And I am willing to be judged on my record of action."

Other parties respond
In efforts to avoid a partisan message, other political parties were given by broadcasters a block of half an hour air-time for immediate responses to Mr Martin's 7-minute taped speech, which had been given in English and French.

Comments were given by The Conservatives' Stephen Harper, Gilles Duceppe of Bloc Québécois and the NDP's Jack Layton.

"We've all just witnessed a sad spectacle, a prime minister so burdened with corruption in his own party that he's unable to do his job and lead the country," said the Conservative Leader.

Mr Duceppe maintained that proof of Liberal party corruption has been established, said a Canadian Press report.

"Paul Martin has broken this link of trust, which makes it impossible for him to remain in power," Mr Duceppe had said.

NDP Leader Jack Layton expressed dismay over the sponsorship scandal, said CTV News, but he had suggested his party would be willing to co-operate with the Liberals in a vote on the budget, if some changes are made.

"Take out the surprise corporate tax cuts and invest that money into the things people want and need. The NDP is in no rush to judge the scandal, but we are in a rush to get something done, to getting a better budget passed," Mr Layton said.