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Guite's testimony triggers frustration, denials

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Date: Sun. Apr. 25 2004 12:42 AM ET

The frustration of Public Accounts Committee Chair John Williams boiled over Friday as testimony by retired public servant Chuck Guite came to an end.

"We've had two days of stonewalling. He hasn't ratted on the government of Canada. He knows he's not being forthright to the committee," Williams said.

After two hours of testimony on Friday from Guite, who headed the government branch which administered the sponsorship program, Williams said this to him: "I don't believe you."

Afterward, Williams continued to show his annoyance. "This guy is just, he's losing it, I'm afraid," he said. "I have no idea how his mind works."

"I call upon the Prime Minister. Somebody knows and somebody will be prepared to tell. Maybe the advertising agencies will sing a different song when the RCMP is on their tail," Williams, a Conservative MP, said.

Williams also suggested Guite's testimony opened up old divisions inside the Liberal Party. "Mr. Guite was very good in defending Chretien and his side, but he was quite prepared to drop some bombs on Mr. Martin," he said.

The end of Guite's testimony has prompted some to wonder when an election will happen. Martin said he'd wait until Canadians heard from Guite before dropping the writ.

But the committee says there's still at least two weeks of testimony to go, and they're still not ready to write a report.

Still, pundits are now talking about a June 14 voting day.

In Friday's testimony, Guite maintained some cabinet ministers interfered with the awarding of government contracts.

"If the minister's office suggests, sends memos, prepares a scope of work designed to fit one company ... it's interfering in the process."

The retired bureaucrat said Paul Martin's former chief of staff, Terrie O'Leary, pushed Earnscliffe Research and Communications to be included on a list of companies eligible for government contracts.

That company was part of the Earnscliffe Strategy Group. Mike Robinson, one of the company's principals, is a long-time associate of Martin. David Herle, the Liberals' campaign co-chair, is O'Leary's live-in partner and a partner in the company's research and communications division.

Earnscliffe has announced it will be selling that division to international public relations firm Burson-Marsteller and will focus on lobbying.

Guite said O'Leary contacted him a few times and the two met a couple of times at her office.

"I definitely met Madame O'Leary. I think it was a discussion after the phone call, I can't say who initiated the meeting," Guite said.

Later, during Question Period, Deputy Prime Minister Anne McLellan said: "At no time, no time did Terrie O'Leary interfere on behalf of Earnscliffe," adding the issue wasn't connected to the sponsorship scandal.

"Interference in contracts is interference in contracts," shot back Diane Ablonczy, a Conservative MP. "It doesn't matter what the issue is."

Friday night, O'Leary issued a statement saying, "Mr. Guite's allegations are false and I deny them absolutely."

O'Leary claimed to have only met Guite once at his request. Documents he put before the inquiry showed she wanted an open competition for Finance contracts, she said.

Some observers have noted one Finance contract were so specific in its requirements that only Earnscliffe could have gotten the work.

Besides attacking Martin, Guite also gave some historical insight into how the awarding of federal contracts worked.

According to what he heard from colleagues, he said, "in the Trudeau years, competition didn't exist. People said, 'Chuck, it was the drawer system. You pull out the drawer and go down the list'."

He also repeated his approval of the way Chretien's government handled the awarding of contracts.
 
"The cleanest I've seen it is when the Liberals came to power in 1993. They removed the political appointees and the political administration," Guite said. "I had no choice but to go to the open bidding system."

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