What You Need To Know About SNC-Lavalin And Jody Wilson-Raybould

It’s the biggest political story of the year.

SNC Lavalin scandal-Jody Wilson-Raybould

(Photo, The Canadian Press/Adrian Wyld)

The firestorm threatening Prime Minister Justin Trudeau over the SNC-Lavalin saga has been ongoing, with a flurry of resignations and The Conflict of Interest and Ethics Commissioner investigating the Liberal government over allegations published in the Globe and Mail that the PMO tried to interfere with the potential criminal trial of Quebec engineering giant SNC-Lavalin. Plus, the Organization for Economic Co-Operation and Development is monitoring the situation, with its working group on bribery saying in a statement March 11 that it is “concerned” by the accusations.

Here’s what you need to know about the biggest political story of the year.

Who’s resigned?

Jody Wilson-Raybould

The former justice minister, and former minister of veteran affairs—announced she was resigning from Trudeau’s cabinet amid allegations the government pressured her to cut a deal with the company. On February 27, Wilson-Raybould made stunning and detailed accusations in testimony before the House of Commons justice committee. (Though on March 15, she confirmed she intends to run for re-election this fall as a Liberal.)

Gerald Butts

Then, on February 18, Trudeau’s principal secretary and long-time friend also resigned. In a statement, Butts unequivocally denied the accusation that he or anyone else in the office improperly pressured Wilson-Raybould. Butts appeared before the House of Commons justice committee on Wednesday, March 6 to tell his side of the saga. (On March 13, the Liberal MPs used their majority on that committee to shut down an opposition attempt to call Wilson-Raybould to testify again in response.)

Jane Philpott

And, on March 4, the treasury Board president Philpott—who is good friends with Wilson-Raybould—also resigned from the cabinet, saying she’s lost confidence in the way the Trudeau government has dealt with the SNC-Lavalin affair. (On March 14, Trudeau filled Philpott’s former position in cabinet with the veteran Vancouver MP Joyce Murray.)

Michael Wernick

The country’s top bureaucrat told Trudeau that recent events have made it clear it would be impossible for him to maintain a “relationship of mutual trust” with the opposition parties.

In a letter to Trudeau released on March 18, Wernick says he plans to leave his post before this fall’s federal election campaign kicks off, partly because the clerk needs to be viewed as “an impartial arbiter of whether serious foreign interference has occurred” as part of a new federal watchdog panel. “It is now apparent that there is no path for me to have a relationship of mutual trust and respect with the leaders of the opposition parties,” Wernick wrote.

Wernick came under fire in the past few weeks after being accused by Wilson-Raybould of being among a number of officials, including Trudeau and his senior staff, who pressured her to head off criminal charges for SNC-Lavalin.

What is Justin Trudeau saying about all of this?

In an early morning press conference on March 7, his most comprehensive statement on the SNC-Lavalin controversy to date, Trudeau said he should have been aware of an “erosion of trust” between his office and Wilson-Raybould. But, he stopped short of apologizing to her. “Over the past months, there was an erosion of trust between my office and specifically my former principal secretary and the former minister of justice and attorney general,” Trudeau said. “I was not aware of that erosion of trust. As prime minister and leader of the federal ministry, I should have been.”

Trudeau was asked directly whether he was apologizing for what unfolded in the SNC-Lavalin case and he stressed that he continues to believe there was “no inappropriate pressure.” Though, he said, “I’m obviously reflecting on lessons learned through this.”

Previously, shortly after Wilson-Raybould concluded her four hours of testimony, Trudeau said “I completely disagree with the former attorney general’s characterization of events. I strongly maintain, as I have from the beginning, that I and my staff always acted appropriately and professionally.” He added that the federal ethics commissioner’s office would settle disagreements over what happened.

On March 18, opposition members erupted in protest when Trudeau announced plans to appoint former Liberal justice minister Anne McLellan as a special adviser to explore what he called “important questions” about the relationship between the federal government and the Justice Department. McLellan “will assess the structure that has been in place since Confederation, of a single minister holding the positions of minister of justice and attorney general of Canada,” the prime minister said in a statement. “She will consider whether machinery of government or legislative changes may or may not be recommended.”

The Liberals earlier came under fire after a scathing Canadian Press story on February 9 had unnamed Liberals painting Wilson-Raybould as a “thorn in the Liberals’ side.” They variously described her as selfish, hard to work with and suggested she didn’t really care about Indigenous affairs since one source “saw her at Indigenous caucus just once.” The piece set off backlash among those who saw it as “racist and sexist innuendo” and another example of how women in power are lambasted for acting like it.

What did Gerald Butts say in testimony to the justice committee?

The former principal secretary said Wilson-Raybould never complained about improper pressure to halt the criminal prosecution of SNC-Lavalin until Trudeau decided to move her out of her coveted cabinet role as justice minister and attorney general. Butts’ testimony offered a very different version of events from those described last week in Wilson-Raybould’s explosive testimony.

Butts repeatedly said he believes nobody from the Prime Minister’s Office did anything wrong and if Wilson-Raybould felt she’d been inappropriately pressured to intervene in the SNC-Lavalin case, she had an obligation to let Trudeau know as it was happening.

He said Wilson-Raybould didn’t raise any concerns about what was happening until the prime minister told her on Jan. 7 that he was shuffling her out of what she called her “dream job” as justice minister and attorney general.

Butts said he and others in the Prime Minister’s Office only wanted Wilson-Raybould to seek independent legal advice on the matter, given the potential impact on the company’s 9,000 employees and the fact that remediation agreements are a new feature in Canadian law.

Butts said he reviewed all the emails and texts he received from Wilson-Raybould going back to the summer of 2013. “There is not a single mention of this file or anyone’s conduct on this file until during the cabinet shuffle,” he said.

According to Butts, Trudeau told Philpott on Jan. 6 that he had decided to move Wilson-Raybould into the Indigenous Services slot because he wanted to “send a strong signal” that he remained personally committed to his reconciliation agenda. Philpott worried that Wilson-Raybould would view the move as a demotion and might wonder if it was “connected to the ‘DPA’ issue”—a reference to deferred-prosecution agreements, as remediation agreements are also known.

Wilson-Raybould refused the job, saying she had opposed the Indian Act her entire life and wouldn’t administer it. Butts said he advised Trudeau that he couldn’t set a precedent by allowing a minister to refuse a move. Wilson-Raybould was ultimately shuffled to Veterans Affairs on Jan. 14.

What did Wilson-Raybould tell the House of Commons justice committee when she finally broke her silence on the case on February 27?

During her testimony, which drew gasps from opposition MPs and the overflow crowd of observers in the committee room, Wilson-Raybould said she believes Trudeau shuffled her out the prestigious justice portfolio in mid-January because she refused to give in to pressure—and even “veiled threats”—to order a halt to a criminal prosecution of SNC-Lavalin.

“For a period of approximately four months, between September and December of 2018, I experienced a consistent and sustained effort by many people within the government to seek to politically interfere in the exercise of prosecutorial discretion in my role as the attorney general of Canada,” she told the committee.

Wilson-Raybould provided a detailed accounting of meetings and phone calls to back up her accusations. The former minister told the committee she was “hounded” to end the prosecution for months after the director of public prosecutions, Kathleen Roussel, had rejected the idea of negotiating a remediation agreement with SNC-Lavalin and long after she had unequivocally declared that she would not direct Roussel to reverse her decision.

While she believed it was inappropriate, Wilson-Raybould said she didn’t consider the pressure to be illegal. She did not resign or directly raise her concerns with Trudeau after Sept. 17, when she first informed him that she would not intervene in the SNC-Lavalin matter. She said she didn’t speak directly to Trudeau about SNC-Lavalin again until Jan. 7, when he informed her he was about to move her out of the justice portfolio; she suggested the move was the result of her refusal to intervene in the prosecution, which he denied. She accepted a move to veterans affairs on Jan. 14 and did not resign from cabinet until Feb. 11, five days after an anonymously sourced allegation that she’d been improperly pressured first surfaced in the Globe and Mail.

Wilson-Raybould reiterated her intention to remain part of the Liberal team as she exited the committee room, even though she refused during questioning to say whether she still had confidence in the leader of that team.

“I’m not sure how that question is relevant,” she said when asked by a Liberal colleague if she still has confidence in the prime minister.

Is the prime minister himself facing an ethics investigation?

Yes, and so is the Prime Minister’s Office. The ethics commissioner Mario Dion believes the government might have ran afoul of the Conflict of Interest Act, and his office has launched an “examination,”as described to CTV News.

On March 12, Dion said he’s taking a prolonged leave from his job for health reasons. Melanie Rushworth, the director of communications in Dion’s office, said in a statement that “despite these exceptional circumstances” the work of the office will continue. Rushworth did not name the SNC-Lavalin investigation in her statement, but said information will continue to be gathered in all ongoing cases. She says Dion will resume his work as soon as he is able and requested privacy for him and his family.

How is Jody Wilson-Raybould in the middle of this? Wasn’t she one of the party’s rising stars?

She was—a former B.C. Crown attorney and B.C. regional chief for the B.C. Assembly of First Nations tapped for the high-profile role of Justice Minister and Attorney General, amid the fanfare of the new Liberal government’s promise to advance the equality of women and embrace true reconciliation with the country’s Indigenous peoples (promises that critics argue haven’t been kept). Then, Wilson-Raybould was demoted mid-January to Minister of Veterans Affairs (yes, it was viewed by many as a “demotion,” since it’s considered a less-powerful position in the government).

Didn’t that raise any flags?

At the time, the Liberals portrayed the shuffle as just one of many moves as Trudeau prepares for the fall election. But that perception changed dramatically with the Globe’s bombshell article. It used unnamed sources to report that the PMO wanted Wilson-Raybould to step in and help SNC-Lavalin negotiate a “deferred prosecution agreement”—essentially, a way for companies to pay their way out of criminal trials. Those agreements only became law this fall, causing some to question whether the Liberals tailor-made this law for SNC-Lavalin. The company’s employees have made illegal campaign donations to the party in the past and had lobbied Trudeau’s government on exactly this point.

Wait, what did SNC-Lavalin allegedly do, again?

In 2015, the RCMP charged the company—a major employer in Quebec—with corruption for allegedly paying various Libyan government officials nearly $48 million in bribes, and defrauding other Libyan entities to the tune of nearly $130 million, all between August 2001 and September 2011 (former employees were also charged in the investigation).

SNC-Lavalin has been arguing (and heavily lobbying) that it’s far too big an employer and too important to the Quebec economy to endure a trial and the potential financial fallout. When the government announced in October 2018 the case would go to court, SNC-Lavalin shares fell to their lowest since 2016. SNC-Lavalin also faces the possibility of being banned from federal contracts—a key portion of its work — for a decade if the company is convicted

The company had reportedly been continuing to look for a way out of a trial—a fate that now appears unlikely.

What is the opposition saying?

On February 27, Conservative Leader Andrew Scheer called on Trudeau to resign, saying Wilson-Raybould’s troubling testimony about SNC-Lavalin proved the prime minister has lost the moral authority to govern.

“Justin Trudeau simply cannot continue to govern this country now that Canadians know what he has done,” Scheer said. “And that is why I am calling on Mr. Trudeau to do the right thing and to resign.”

On the evening of February 28, there was an emergency debate in the House of Commons on Wilson-Raybould’s testimony, as requested by the Conservatives and supported by the NDP.

The Big Story: Jody Wilson-Raybould: The woman in the eye of the storm.

Learn more at The Big Story Podcast.

What does this mean for the election?

The government’s sunny, squeaky clean image that swept it to victory in 2016 has been sullied on environmental issues, international relations, and Indigenous relations. But these allegations go to the very heart of Trudeau’s more-ethical-than-thou messaging.

“The allegation involving Jody Wilson-Raybould and its aftermath has effectively kneed the Liberal government where it hurts the most—squarely in its Real Change™ optics,” wrote Anne Kingston.

It could also severely undermine government’s “rule of law” argument in the controversial detention of a Chinese businesswoman, Huawei’s Meng Wanzhou.

“They have built up this rule of law so high and so mighty, and it will fall flat on its face if we can connect the dots if we find out they have tipped the scales of justice,” noted CTV Ottawa bureau chief Joyce Napier.

If the allegations are proven true, it all bodes extremely ill for Trudeau’s re-election bid. The questions go something like this: How can he be a feminist if he demotes a key female star in the party for standing her ground—a star who then resigned from his cabinet? How can he have integrity if he’s allegedly working behind the scenes for corporate interests? What political change is there in a prime minister who apparently doesn’t want to answer fully the question of whether, or how much, he may have pressured Wilson-Raybould?

With files from Rosemary Westwood, the Canadian Press and Maclean’s.