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Senior bureaucrat contradicts Clement on G8 fund: memo

Conservative Leader Stephen Harper and MP Tony Clement in Huntsville, Ont., June 19, 2008. THE CANADIAN PRESS/Adrian Wyld.

A senior federal bureaucrat has contradicted Tony Clement’s insistence that he was not involved in dividing a $50-million fund to spruce up his riding before the 2010 G8 summit.

The Treasury Board president has insisted he simply played a “co-ordinating role,” forwarding the wish lists of mayors in his Parry Sound-Muskoka riding to John Baird, who was then infrastructure minister and had the final say on which projects would get funding.

But Clement’s assertion is directly contradicted in memos prepared by a senior civil servant involved in helping the sprawling, Ontario cottage-country riding reap the benefits of hosting the G8 summit. The memos were obtained by the NDP through the Access to Information Act.

Tom Dodds, an official with the northern Ontario economic development agency known as FedNor, says his agency helped Clement’s office prepare letters advising municipalities that most of their original 242 proposals would not get any funding. As industry minister at the time, Clement presided over FedNor.

The unsuccessful applicants were told “their projects would not be forwarded to Minister Baird for his consideration,” Dodds wrote in a memo to the deputy minister of Industry last Nov. 2 — the same day Clement appeared before a Commons committee to explain his role in the G8 legacy fund controversy.

“A list of unsuccessful applicants was provided by the minister’s office to FedNor officials and letters were prepared in accordance with the direction received from the minister’s office,” Dodds wrote.

“Finally, once Minister Clement’s office provided the list of recommended projects to Minister Baird’s office, FedNor officials transferred the catalogue of projects to Infrastructure Canada officials. All 242 project proposals were sent; this included the 32 projects which were recommended by Minister Clement.”

In an earlier email, dated Jan. 13, 2010, Dodds wrote: “It is my understanding that MINO (Clement’s office) advised Infrastructure Canada which projects should be supported under the G8 Infrastructure and Legacy Fund and their staff prepared contribution agreements for them accordingly.”

Clement’s version of events when he appeared before the Commons public accounts committee last November was starkly different. He vehemently denied opposition accusations that he or any of his officials were involved in selecting the winning 32 projects which received almost $45 million.

“That’s just a myth,” he told the committee. “It never happened that way. We were not involved in selecting these projects.”

Clement said the mayors initially came up with 242 proposed projects worth an estimated $500 million. When he advised them to whittle down their wish lists, he said they came back with 33 projects, 32 of which were ultimately approved by Baird. Clement rejected opposition assertions that he was the “guiding hand” behind the choices.

In September, Clement told reporters it would have been illegal for him to choose which projects were funded.

“If I was the decision-maker, if I had set up a parallel process and created a situation where the auditor general did not know — that’s their (opposition MPs’) accusation — I’d be resigning right now and turning myself in to the local police office,” Clement said.

Dodds’ recollections also raise questions as to why Auditor General Sheila Fraser found no paper trail when she tried to determine how projects were selected. She was told no federal departments or agencies, other than Infrastructure Canada, were involved in the decision-making and could, therefore, provide no documentation.

Dodds’ memo suggests FedNor was heavily involved in the selection process and compiled documentation which it passed on to Infrastructure Canada.

Municipal documents, obtained in the past by the NDP through provincial freedom-of-information legislation, have shown Dodds and other FedNor officials attended local meetings with mayors at which the legacy fund was discussed. They’ve also shown that municipal officials were under the same impression as Dodds that Clement was calling the shots and that applications for funding were funnelled through Clement’s constituency office.

The legacy fund, controversial since its inception, was used to pay for gazebos, public washrooms, park and streetscape improvements and other beautification projects in Clement’s riding, many of them nowhere near Huntsville, where the summit was actually held.

In her final report before retiring, Fraser blasted the government for keeping Parliament in the dark about the fund. She found that the government got Parliament’s authorization for an $83-million border infrastructure fund, without disclosing that $50 million of it was to be used for G8 legacy projects miles from any border crossing.

Baird, now foreign affairs minister, has acknowledged some administrative foul-ups in creation of the fund but insists everything else was above-board.

Opposition MPs maintain the government set up a slush fund for Clement to dispense as he saw fit in a bid to win re-election in 2008. He’d won his riding by a meagre 28 votes in 2006 but sailed to victory two years later, with endorsements from local officials who were already meeting him to discuss funding, although the legacy fund had not yet been officially established.