Morneau Repays $41K in Travel Expenses to WE, Faces Resignation Calls

July 22, 2020 Updated: July 22, 2020

OTTAWA—Finance Minister Bill Morneau faced calls for his resignation Wednesday after revealing he had just repaid over $41,000 in travel charges to WE Charity—an organization MPs heard had multiple contacts with his office while the government planned its $900-million student-volunteer program.

Prime Minister Justin Trudeau has also agreed to testify before the House of Commons finance committee probing the aborted agreement, a rare move for a prime minister. So will his chief of staff, Katie Telford.

Trudeau’s office said exact times and dates for those appearances have yet to be set.

The federal ethics watchdog is already investigating Trudeau’s and Morneau’s role in giving the WE organization a contract to run the Canada Student Service Grant, which the government presented as a way to help students with education expenses as they faced a summer of unemployment in a COVID-19-stricken economy.

It would have paid the group about $43.5 million.

Both have apologized for not recusing themselves from discussions about WE because of their familial ties to the organization—Trudeau because of speaking fees paid to his brother, mother and wife, and Morneau because one of his daughters works there in an administrative role.

Morneau’s highly anticipated appearance at the finance committee began with him saying he had sent a cheque to the WE organization just Wednesday to repay tens of thousands of dollars in expenses related to accommodation and other charges the group covered.

Morneau said it was always his intention to personally cover those amounts, but WE never charged them to him and his family. They were related to a trip the minister took to Ecuador in summer 2017 to see some of the humanitarian work WE was undertaking. Morneau said he was surprised to learn he could not account for the expenses after going over receipts ahead of his testimony to the finance committee.

After contacting the charity, Morneau said, he sent a cheque for $41,366 to repay the full cost of the trips because it wasn’t appropriate to accept the expenses, even unknowingly.

He said he passed the information on to the ethics commissioner.

“I’m not making an excuse. It was my mistake,” Morneau told the committee.

He added: “I will continue to work on behalf of Canadians.”

Cabinet ministers are forbidden to accept such a benefit, a lesson Trudeau learned after the ethics watchdog found him in violation of conflict of interest rules for his family’s vacation to the Aga Khan’s private island near the start of his first term.

“We know that this is illegal. We know that you ought to have recused yourself,” Conservative finance critic Pierre Poilievre said, referring to the decision on the student grant program, before adding: “Minister, you’ve lost the moral authority to hold your office.”

He then called on Morneau to resign. So did Conservative Leader Andrew Scheer, in a news conference after the committee meeting.

The timeline of events that Morneau provided to the committee began on April 5, when he had a conversation with Trudeau about how to help students whose summer-job and volunteer opportunities were vanishing due to the pandemic.

Two days later, WE was one of a dozen groups his office reached out to as part of stakeholder engagement to gauge challenges and possible program options.

On April 9, three events took place, according to testimony at the committee Wednesday:

  • Morneau got a briefing about a potential grant program for students looking to gain experience over the summer;
  • his office gave Finance Department officials a summary of talks with outside groups, including WE;
  • WE itself sent a pitch for a different, but related, youth program to ministers.

Trudeau told the House of Commons that pitch made its way to his office via the normal policy process, but was ultimately rejected.

By April 18, WE was being discussed as an option for running the government’s program as Morneau’s officials raised the idea of partnering with a non-profit, or for-profit group to administer the program. It was the first time he said he was involved in any talk about WE and the grant program.

A senior Finance Department official, Michelle Kovacevic, told the committee Wednesday that on April 20, Morneau’s office connected with WE to suss out its ability to deliver a volunteer program.

She told the committee that the records of the call note that “WE Charity will re-work their 10-week summer program proposal to fully meet the policy objective of national service and increase their current placements of 8,000 to double.”

Morneau approved going with an outside organization to run the volunteer program on April 21, but no specific group was chosen. The next day, Trudeau announced the broad parameters of the program, and WE sent an updated pitch to the department now taking the lead: Employment and Social Development Canada.

Morneau spoke with WE co-founder Craig Kielburger on April 26, but the minister said neither he nor Kielburger talked about the Canada Student Service Grant program.

On May 4, Kovacevic said, WE sent a third proposal to the government, this time with more details and specific to the grant program. The next day, Youth Minister Bardish Chagger went to a cabinet committee with the recommendation to go with WE.

Cabinet, including Trudeau and Morneau, approved handing the reins of the program to WE on May 22.

The Liberals have said the non-partisan public service recommended going with WE as it was the only organization in the country able to launch a program as quickly and as broadly as the government wanted.

The opposition parties argue that the timeline of events suggest the Liberals gave the charity the inside track on landing the program.

WE ultimately gave up at the start of the month as controversy swirled, along with criticism about effectively paying students below minimum wage and calling it volunteering.

Weeks later, the government is stumbling to roll out a pared-down version of the program. Employment and Social Development Canada was unable to provide an update on the transition Wednesday.

Two groups representing thousands of post-secondary students called on the Liberals to abandon the troubled program and push its $912 million maximum budget to other student supports.

The Canadian Federation of Students and the Canadian Alliance of Student Associations say it’s clear the program, which pays students up to $5,000 toward education costs based on the number of hours they volunteer, won’t provide the financial help students are looking for.

By Jordan Press