Harper to announce Muskrat Falls deal in Labrador

Prime Minister Stephen Harper will be in Labrador on Friday to announce the finalization of a loan guarantee for the huge Muskrat Falls hydroelectric project, CBC News has learned.

The planned dam and power-generating station will generate electricity from Churchill River, and will send power to Nova Scotia as well as Newfoundland and Labrador.

Multiple sources say the event, in the Labrador community of Happy Valley-Goose Bay, has been pulled together over the last 24 hours — a reflection of how quickly the loan negotiations have moved.

Sources told CBC News that negotiations on the loan guarantee for the proposed $7.4 billion megaproject are still happening, but progress has accelerated over the course of the week and a conclusion seems imminent.

Not only is the prime minister travelling to Goose Bay for the announcement, but sources said Newfoundland and Labrador Premier Kathy Dunderdale has made last-minute plans to go, as has Nova Scotia Premier Darrel Dexter.

Dunderdale seemed surprised earlier this afternoon when word broke of the prime minister's visit.

"Look, all I can tell you is I don't know that there's an announcement to be made in Happy-Valley Goose Bay tomorrow. I don't know that."

The federal loan guarantee is the last major piece missing in the premier's Muskrat Falls puzzle.

She has said all along that once the financing terms were in place, her cabinet would move quickly to officially sanction the project, an outcome that has seemed inevitable for quite some time.

Harper's visit also comes at a time when Peter Penashue — the lone Conservative cabinet minister in Newfoundland and Labrador — is under fire for spending thousands of dollars over the legal limit during last year's federal election.

A report issued yesterday also raised questions about Penashue's family and business ties to the Muskrat Falls project.

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EU 'very close' to an 'ambitious' trade deal with Canada

The European Union is "very close" to an "ambitious" free-trade deal with Canada, its trade commissioner said Thursday, with negotiations still seemingly needed on agriculture and investor protections, among other issues.

European Trade Commissioner Karel De Gucht couldn't confirm when the trade talks would conclude toward the Comprehensive Economic and Trade Agreement, but he said the EU is "united in working together with Canada to close the gaps on the final issues."

EU Trade Commissioner Karel De Gucht, shown here in May, briefed reporters Thursday on the state of the EU's trade negotiations with Canada and other countries. He said a trade pact with Canada would largely deal with 'innovative high-tech trade.' (Laurent Dubrul/Reuters)

At a meeting Thursday of the EU's council of foreign affairs and trade ministers, De Gucht and Neoklis Sylikiotis — the commerce minister for Cyprus, which currently holds the rotating presidency of the council — told reporters that the negotiations are "very close to an agreement" as ministers discussed how to conclude several outstanding issues.

De Gucht called the future agreement "ambitious and important" and said the council wants to "conclude the deal as soon as possible."

"The majority of the deal is about setting the future framework for the innovative high-tech trade between two developed economies," De Gucht said. "Of course I'm not interested in a paper deal but one that would bring real and meaningful benefits."

He gave no details on what has been agreed to and what issues remain.

However, a written news release revealed that on Oct. 30 an agreement was reached with Canada on the chapter of the agreement relating to the criminal enforcement of intellectual property rights. It did not elaborate on the exact text of this chapter.

The Netherlands said earlier this fall that if the trade deal included provisions similar to the Anti-Counterfeiting Trade Agreement voted down by the European Parliament last July, it would not support the deal.

'Sensitive' agricultural issues broached

International Trade Minister Ed Fast met with De Gucht last Thursday and subsequently said both sides are looking for "ambitious outcomes" that will yield an "appropriately balanced" pact.

"We will only sign an agreement that is in the best interests of Canadians," Fast said in question period on Monday, accusing the opposition of engaging in "idle speculation" about what might be in the final deal.

Last week's talks represented the first time concrete positions were exchanged on several agricultural commodities prioritized for inclusion in the final deal. More work remains as negotiators figure out the technical aspects of these proposals.

The "sensitive" agriculture sector had been left to the final stages of the talks, as both sides grapple with contentious issues.

Investor protections discussed

Some of the EU's trade and foreign affairs ministers said at their meeting Thursday that the European Union's policy on investor protections also has to be finalized before a trade deal with Canada comes into force.

Similar but not identical to Chapter 11 in NAFTA, the Comprehensive Economic and Trade Agreement will have a dispute-settlement process to allow foreign investors to hold countries accountable for breaching aspects of the deal.

Members of the Group of the Greens/European Free Alliance vote against the Anti-Counterfeiting Trade Agreement at the European Parliament in Strasbourg in July. If similar measures are contained in an eventual draft trade pact with Canada, it could scuttle the deal. (Vincent Kessler/Reuters)

A leaked EU briefing document dated earlier this fall suggested the two sides remained apart on aspects of the investment protection Canada originally asked to include in the deal.

Much of Thursday's public deliberations of the EU ministers involved the final responsibility, or liability, of member states. While the EU negotiates deals on behalf of all its 27 member states, the actions of one or more specific countries could trigger a dispute in which the entire EU would share accountability.

Canada could face a similar situation if actions by municipal or provincial governments trigger disputes with European companies.

Ratification challenges

If Canada does successfully negotiate an agreement with the European Commission, that doesn't necessarily mean it would be ratified by the European Parliament.

Members of the European Parliament have expressed dissatisfaction with Canada on several fronts, including its pulling out of the Kyoto Accord, promotion of Alberta's oilsands, lobbying against the EU's fuel directive, and the seal hunt.

Last June, European President José Manuel Barroso quarrelled openly with Prime Minister Stephen Harper and Finance Minister Jim Flaherty over Canada's refusal to contribute to the International Monetary Fund's bailout of European banks and linked the success of the trade talks to Canada's co-operation with Europe on other fronts.

Depending on what's in the final text, individual countries may need to sign off on the deal as well, if it impacts matters of their national jurisdiction.

A vigorous debate among environmental and civil society groups could influence votes, as it did when the Anti-Counterfeiting Trade Agreement was defeated in a surprise vote last July.

An agreement with Canada isn't the only trade pact on the EU's agenda. It's also working toward deals with Japan, Singapore, Morocco and Tunisia.

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Chris Hall: What should be Canada's role in the Middle East?

When Canada's John Baird took to the podium at the UN Thursday to condemn the vote elevating the Palestinian Authority to a non-member observer state, it was a message few in the chamber wanted to hear.

The General Assembly, after all, was just moments away from an overwhelming endorsement of the move, thereby placing Canada in a small minority of opponents along with the U.S. and Israel.

Nor was Canada's opposition a surprise. Prime Minister Stephen Harper had earlier this week rejected the enhanced status, calling it a ''shortcut'' to statehood. His foreign affairs minister labelled it a ''unilateral'' move that would undermine negotiations with Israel for a peaceful, two-state solution.

What most wouldn't have realized as Baird spoke is that Canada's resolve to stand with Israel hardened in September at the opening of the General Assembly, while Harper waited to meet the Palestinian Authority President Mahmoud Abbas.

Sources have described the discussion as curt. Though photos of the two men meeting that day show them both smiling and shaking hands.

But it was apparently what happened immediately before their brief meeting that reinforced the prime minister's opposition to the Palestinian bid.

Prime Minister Stephen Harper and Mahmoud Abbas, president of the Palestinian Authority, in September at the UN opening session, a meeting that has since been described as 'curt.' (Paul Chiasson / Canadian Press)

Harper watched as Abbas walked through a gauntlet of world leaders who had just listened to his speech, accepting their praise and support. Few of those leaders bothered to return to the chamber to listen to Israeli Prime Minister Benjamin Netanyahu offer his rebuttal.

Insiders say the spectacle pushed Harper to bluntly warn Abbas privately that there would be further consequences from Canada if the push for enhanced status was not abandoned.

And now Baird's speech Thursday repeated the warning, this time publicly, but without elaborating.

The next steps

"As a result of this body's utterly regrettable decision to abandon policy and principle,'' Baird told the assembly on Thursday, "We will be considering all available next steps.''

There's already speculation those next steps could include a decision not to renew $300 million in aid to the Palestinian Authority, and to remove the credentials of Palestinian representatives to Canada.

Whatever the Harper government does, its staunch support of Israel is clearly set, much to the alarm of its critics.

Many see this harder line as a shift away from Canada's traditional role as both a supporter of Israel, and what retired Canadian diplomat Steve Hibbard recently called a more ''fair-minded'' approach to the issues that bedevil Mideast peace efforts.

In an article this month for the Canadians for Justice and Peace in the Middle East, Hibbard said the Harper government has undermined that approach and Canada's standing in the Middle East.

"Perhaps the most helpful step Canada could take is to use its close ties with Israel to work with Israelis and Palestinians to build mutual trust,'' he concluded.

For his part, NDP Leader Tom Mulcair thinks the Conservatives are taking an ever-hardening line against the Palestinians.

"What we have on the Canadians' side under the Conservatives is negativism," he says. "Reproach. Attack. Threats. That's not constructive. That's not a way to build for peace.''

What should be Canada's role?

In fact, there's no disagreement over the outcome Canada wants for the Middle East. The dispute is over how to get there, and the role this country should play.

Baird and Harper have both said they make no apologies for standing with Israel, reminding their political opponents at home that Israel is a Jewish state, in a neighbourhood of the world that's hostile to its very existence.

Foreign Minister John Baird addressing the UN on Thursday. (Bebeto Matthews / Associated Press)

In his speech Thursday, Baird advanced another argument aimed at the international community.

He sought to position the resolution granting the Palestinian Authority enhanced status as running counter to the UN's own history.

He ran through the resolutions on the Middle East dating back to 1947, recognizing that the two parties — Israelis and Palestinians — need to work collaboratively to find solutions.

"The path to peace has historically rested in direct negotiations between the two parties to resolve all outstanding issues and it remains the same today,'' Baird said. ''Solutions can only come through the two sides working together.''

The territories

It was an argument that garnered only polite applause from those in the assembly. And it left unspoken two important issues.

First, Baird avoided any direct criticism of Israel's own unilateral moves.

He made no mention of the expanded Israeli settlements in the territories, including the concern expressed two years ago by his predecessor at foreign affairs, Lawrence Cannon.

In March 2010, Cannon, who is now Canada's ambassador to France, opposed Israel's plan to build 1,600 apartments in Arab east Jerusalem.

He told the Commons foreign affairs committee that Canada firmly believes in two sovereign states living side by side in harmony.

"On expansion into East Jerusalem, we feel that this is contrary to international law and therefore condemn it. We're very concerned with what is taking place."

The other unspoken issue is that Canada's approach now mirrors the U.S. in saying essentially that the Palestinians can't achieve statehood without negotiating Israel's consent.

Adaptable

While Stephen Harper has shown an ability to adapt his foreign policy positions in other parts of the world, that's not been the case when it comes to the Middle East.

He has pushed hard to expand ties with China, for example, despite strongly expressed concerns in the past over China's human rights record.

That shift was motivated by a desire to expand foreign trade, and to open markets for Canadian business.

With Israel, the motivation is different.

It's partly political. The Conservatives won their first seats in Metro Toronto in ridings with a substantial Jewish vote. And they still have designs on another — Mount Royal in Montreal — currently held by the Liberals.

The other is an underlying view that Abbas and the Palestinian Authority are only reluctant partners in the peace process, and that today's vote on UN status is an incentive to maintaining the status quo rather than negotiating peace.

That is not a view shared by the majority of other UN members, including many European nations who supported the bid or, like Britain, abstained, only because they couldn't get a guarantee from Abbas that he wouldn't use the new status to try to challenge Israel's occupation of the West Bank before the UN's International Criminal Court.

For Stephen Harper, though, there can be no shortcuts to statehood for the Palestinians. And on that score, his government is simply not prepared to budge.

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Critics ask why Canada learned about spy from U.S.

Sub-Lt. Jeffrey Paul Delisle, who pleaded guilty to espionage, is escorted from provincial court in Halifax. He worked as an intelligence officer in a top secret facility. (Andrew Vaughan/Canadian Press)

The news that Sub-Lt Jeffrey Delisle, the Canadian naval officer who pleaded guilty to spying in October, could have been caught earlier — as information from seach warrants obtained by CBC suggests — prompted anger from opposition parties on Parliament Hill on Thursday.

Opposition critics said the revelation that it was the FBI that tipped off the RCMP to suspicions about Delisle, as well as the news that Delisle's security clearance had expired, was disturbing and a "significant breach of security."

Delisle was arrested January 2012 for downloading highly classified documents onto a USB key and passing the information to Russia over a five-year period. He had been working at HMCS Trinity, a top secret naval intelligence facility in Halifax.

The documents were released to the CBC following a court application for three search warrants used to search Delisle's house, car and workplace. The warrants show that in Dec. 2, 2011, the FBI's assistant director sent a letter to the RCMP that implicated a Canadian military officer in espionage and named the officer. That information, however, wasn't given to the Royal Canadian Navy until Dec 20. Delisle wasn't arrested until Jan. 13, more than a month after the FBI warning.

During his time at Trinity, Delisle was going through a bitter marriage breakup and was having financial problems, two factors that would have sounded warning bells in any intelligence officer's security check. But the CBC-obtained documents reveal that Delisle's Level 3 security clearance, the second-highest possible, had not been reassessed when he went to work at Trinity.

'Spycraft 101'

"So what's missing here is some statement from the government recognizing that they had failed to do a proper job, and somehow or other that they are taking this seriously and reacting properly," NDP defence critic Jack Harris said Thursday.

Liberal defence critic John McKay said, "I would hope that [Defence] Minister [Peter] MacKay would have to do some very fast talking to our allies about A, how this happens, and B, that there will be no chance that it ever happens again." McKay added that spotting Delisle should have been "Spycraft 101."

In question period Thursday, Harris asked MacKay what steps he has taken to improve security since last January when Delisle was arrested.

MacKay replied: "The Department of National Defence takes the handling of secure information, secret information very seriously.... This is not something that I or anyone else should be discussing on the floor of the House of Common publicly." MacKay also pointed out that the matter is before the courts.

After question period, Harris said, "The court case is over except for the sentencing. There's no issues to be debated here except what has this government done to assure Canadians, to remind our allies, but to assure Canadians that they've got their act together. He's not saying anything."

Might have been a defector source

Wesley Wark, an intelligence expert at University of Toronto, said in an email that it's possible that "the Americans might have had a defector source of some kind, which is often how these cases are uncovered. It's not particularly surprising that there might have been a delay between the FBI warning and the arrest as steps would have to happen to gather Canadian evidence to lay charges."

However, Wark said he can't understand how Delisle's security clearance was allowed to lapse. "TS [top security] clearances are meant to expire automatically if not renewed after five years. It is pretty hard and fast as any TS holder will tell you. A little lag might be allowed if the renewal was in progress, but not months [long] lag. I always felt that something had gone wrong with the security process in the Delisle case."

Delisle will be sentenced Jan. 12. He could get a life sentence.

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Canada to review 'full range' of relations with Palestinians

Canada is temporarily recalling its heads of mission to Israel and the West Bank, along with its United Nations representatives in New York and Geneva, to protest the Palestinians' successful bid on Thursday for upgraded status in the UN.

Foreign Affairs Minister John Baird pledged to "review the full range of its bilateral relationship" with the Palestinian Authority in the wake of the vote in New York City.

"Yesterday's unilateral action does nothing to further the Middle East peace process," Baird said in a statement released Friday morning. "It will not change the reality on the streets of the West Bank or Gaza. This unilateral step is an impediment to peace."

Canada was one of nine countries, including the U.S. and Israel, to oppose upgrading the UN observer status of the Palestinian Authority from "entity" to "non-member state."

"We again call on the Palestinian Authority and Israel to return to negotiations without preconditions, for the good of their people," Baird said.

There has been speculation that Canada will ask the Palestinian delegation in Ottawa to leave, or not renew its $300 million in aid to the Palestinian Authority over five years.

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Trudeau admits comments may have affected Calgary byelection

Liberal Justin Trudeau says negative comments he made about Alberta two years ago may have "hindered a little bit" his party's chances in the Calgary Centre byelection.

But in an interview on CBC Radio's The House with Evan Solomon he said he helped Liberal candidate Harvey Locke "on the ground" by campaigning with him several times in Calgary.

"Look, I helped out by being there on the ground. I may have, I may have hindered a little bit, I apologized but in general I think the fact is whether or not we won or lost that byelection there was always going to be an awful lot of work to do in Calgary moving forward towards 2015," Trudeau said.

Trudeau said on a Quebec TV program two years ago that Canada wasn't doing well because "it's Albertans who control our community and socio-democratic agenda." The remarks were dug up by a media outlet last week, just days before the Calgary byelection on Monday. Trudeau apologized for his comments and said that he meant Stephen Harper's government, and not Albertans.

Locke, the Liberal candidate who was running against Conservative candidate Joan Crockatt, came a close second in the race with nearly 33 per cent of the vote compared to Crockatt's nearly 37 per cent.

Locke's voter base could also have been affected by remarks last week by Liberal MP David McGuinty, who said that Alberta MPs should "go back to" their home province if they weren't prepared to work for the national interest, rather than just Alberta's, when it comes to energy. McGuinty apologized and resigned his role as his party's natural resources critic.

Liberal MP Marc Garneau, who declared his leadership candidacy Wednesday, said on CBC's Power & Politics that Trudeau comments "didn't help" Locke. Garneau went on to say that he fully understands the West and the oilsands, because he spent two years on the board of an Alberta energy corporation.

The full interview with Trudeau can be heard on The House on CBC Radio Saturday.

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Baird going to UN to oppose Palestinian statehood bid

Foreign Affairs Minister John Baird says he'll travel to New York Thursday and will oppose any "unilateral" move by the Palestinian Authority for statehood at the United Nations.

The UN General Assembly is set to consider the matter Thursday, a year after Palestinian President Mahmoud Abbas formally asked the UN to consider his application for full membership in the UN.

That request has been blocked so far by the Security Council, but Thursday's resolution to recognize Palestine as a non-voting observer state is expected to pass. Unlike the Security Council, in the General Assembly no one country has veto power.

The Palestinian Authority representative at the UN, Riyad Mansour, says he expects Thursday to be a historic day for the Palestinian people and for the UN. But the vote will likely divide world governments.

The Palestinian delegation to Canada said in a statement Wednesday the vote is an "interim step" in light of the "impasse" over the request for full membership. "We call on all peace-loving countries to support our bid at the UN," Said Hamad, chief representative of the delegation, said in the statement.

Baird told MPs in the House of Commons Wednesday he was "tremendously disappointed" with the Palestinian Authority's decision to seek the status at the UN, which he said violates several accords. Baird urged both sides, Israel and the Palestinians, to get back to the negotiating table to find a lasting peace.

But he left no doubt where Canada's support lies, saying repeatedly that Canada supports the "Jewish state" and the people of Israel.

Harper holds fast

During a press conference with Mexico's president-elect on Parliament Hill Wednesday, Prime Minister Stephen Harper was asked why Canada wouldn't adopt a stance similar to Britain and support the Palestinian bid with the proviso that it commit to returning to peace talks.

Harper repeated Canada's oft-stated position.

"We favour a two-state solution in this region, that will not be accomplished in reality unless and until the Palestinian Authority returns to the negotiating table and is able to get a comprehensive peace agreement with Israel," Harper said.

"So we encourage them to do that and we will not support any other shortcuts or any other ways of trying to arrive at that solution without such a peace agreement."

Along with Canada, the United States and Israel are sharply opposed to the resolution, and Germany has announced it too will oppose the move. France, meanwhile, says it will back the Palestinian bid, as will China and a host of other nations.

Britain's Foreign Secretary William Hague has indicated his government may abstain from the vote.

"We want to see a Palestinian state and look forward to the day when its people can enjoy the same rights and dignity as those of any other nation," Hague told his fellow MPs in the Commons in London today.

"But for us to support a resolution at the UN, it is important that the risks to the peace process are addressed so that the chances of negotiation beginning after it are enhanced rather than diminished."

NDP critical of government stance

In Ottawa, New Democrat Leader Tom Mulcair called the resolution a reasonable request by the Palestinians and criticized the government's decision to vote against it.

"What we have from the Canadian side, under the Conservatives, is negativism, reproach, attack, threats," Mulcair said.

"We would like to see Canada playing a constructive role as we once proudly did on the world stage. Under Mr. Harper's Conservatives, we no longer play a constructive role."

Interim Liberal Leader Bob Rae said his party does not support the motion before the UN but predicts it will be accepted by the General Assembly.

"I have to say that I see the UN resolution as a bit of a diversion," Rae said.

"Yes, it's going to cause a big flurry.… but frankly that resolution doesn't take us any further. And the real key issue is to get the parties in front of each other and talking about negotiations."

Montreal MP Irwin Cotler noted in the Commons Wednesday that Thursday's vote will fall on the same date the UN General Assembly, in 1947, recommended the adoption and implementation of a partition plan for British-controlled Mandatory Palestine into Arab and Jewish states.

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Company censured for Tory calls to Montreal Liberal riding

A company working for the Conservative Party has been censured by its industry body over calls made to voters in Liberal MP Irwin Cotler's Montreal riding.

But the censure decision also provides a way for its members to use similar tactics, as long as they're done through a separate entity rather than a division of the company.

Campaign Research, through "acts, omissions and public statements," violated public confidence and its professional responsibilities, a complaints panel of the Marketing Research and Intelligence Association (MRIA) concluded.

The panel also said "the firm has likely diminished public confidence in the marketing research industry," and hinted that the calls had little connection to polling.

"It may be argued that the project in question was not marketing research. However, the project definitely created strong negative opinions," the decision says.

Cotler complained a year ago in the House of Commons that calls to voters in his Mount Royal riding suggested he was stepping down from his seat and that those calls interfered with his ability to do his job as an MP.

MRIA received seven complaints about the phone calls, which the Conservatives said were meant to identify potential voters.

Conservative MPs didn't deny being behind the calls, arguing that they are protected as free speech, and that they were just trying to identify potential voters.

No apology for Cotler

House of Commons Speaker Andrew Scheer ruled last December that he had no power to deal with the Conservative phone calls, though he called them "reprehensible."

Scheer said he was sympathetic to Cotler and that there's no doubt Cotler has been bombarded by calls and emails from confused constituents, but he had difficulty concluding Cotler wasn't able to carry out his parliamentary duties.

Cotler had argued the calls were a breach of his privilege as an MP.

Cotler said he wants the Conservative Party to sever its ties to Campaign Research and promise not to "engage in such false and misleading voter suppression again."

"Here we have an independent panel finding that they violated public confidence, that they violated their own codes of conduct and professional responsibility," he said to reporters after the Liberal Party's weekly caucus meeting.

"When the Speaker characterized the acts as reprehensible at the time, we still did not get an apology from the Conservative Party. In fact, I've never gotten an apology from them for the kind of permanent, false and misleading campaigns that they've been running in my riding for over 2½ years."

'Gold seal' comment part of review

A major part of the decision hangs on an interview by Campaign Research principal Nick Kouvalis with CTV News Channel.

In the interview, Kouvalis referred to the association and used it to justify the work of Campaign Research, the panel writes in the decision.

"If we were push pollsters, we wouldn't have a gold seal at the MRIA," the report quoted Kouvalis as saying.

The complaints panel focused on that statement and other similar ones, noting that the association's members are supposed to ask journalists not to refer to the organization so that their own views aren't confused with those of the association.

"[Kouvalis] used Campaign Research's gold seal certification and its MRIA membership to attempt to convince the Canadian public that Campaign Research did nothing wrong in carrying out the voter identification project in Mount Royal," the report said.

The calls in Mount Royal were made by Campaign Support, a division of Campaign Research that has since been made independent, the report says.

'Not legitimate' public opinion research

MRIA wouldn't have had any reason to get involved in the public complaints if Campaign Support had been a completely separate business entity, the contract with the Conservative Party had been directly with Campaign Support, and if Kouvalis had not mentioned MRIA or the company's gold seal certification, the report says.

Now that Campaign Support has been made independent of Campaign Research, "this was an important step and one to be commended, particularly since Campaign Research undertook the step on its own initiative," the panel wrote.

Campaign Support could never be a member of the association, MRIA spokesman Brendan Wycks said, because its work isn't legitimate marketing, survey and public opinion research. Legitimate research doesn't identify individual respondents, but the nature of voter identification means the company's client gets information on specific people.

"A voter identification project is not legitimate marketing and survey research, so it could not be carried out by a member agency of MRIA," Wycks said.

Wycks said he thinks the censure will be effective because it's a public shaming accompanied by widespread media coverage.

'Disgusting'

The association is a voluntary organization, but has a complaint resolution process for issues with its member firms.

The decision also includes the script for the calls, provided by Campaign Research. Callers were to say that they were calling on behalf of the Conservative Party of Canada and ask whether Stephen Harper could count on the constituent's support "in the upcoming election."

"If asked what election this is for, say the following: 'Some people are suggesting that the current MP MAY retire, so we're calling on behalf of Prime Minister Stephen Harper and the Conservative Party of Canada to ask you if you would consider supporting the Conservative Party of Canada if there is a byelection,'" the script reads.

Cotler was re-elected on May 2, 2011, six months before the calls started.

Interim Liberal Leader Bob Rae said Harper should take responsibility for the calls, which were paid for by his party.

"The effort to dislodge Mr. Cotler was, to use a technical term, disgusting," Rae said.

To imply Cotler was stepping down was beyond any standard in politics he's ever known, Rae said, since the people running the company and the Conservatives knew that "it was a lie and knew it was false and knew it was untrue."

"The response that you've got to remember is the response of Mr. [government House leader Peter] Van Loan. Who said, 'It's just politics. It's how we do business.' That tells you something about the Conservative Party."

In the House, Van Loan said he considered the issue settled, given Scheer's ruling last year, and said Rae is experienced enough to know that the issue wasn't House business.

"I'm experienced enough to know when a minister is refusing to answer a question," Rae shot back.

The Conservatives have long targeted the seat that Cotler has held since 1999.

Custom code:

Complaints Report: Campaign Research (PDF)
Complaints Report: Campaign Research (Text)

With files from Alison Crawford

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The Nanos Number: Changing population means changing politics

Nik Nanos digs beneath the numbers with CBC Power & Politics host Evan Solomon to get to the political, economic and social forces that shape our lives.

This week: How will changing demographics affect long-term political strategies?

Three byelections on Monday didn't result in any major changes in the House of Commons, but beneath the surface there could be hints of what's to come the next time Canadians go to the polls.

In the riding of Calgary Centre, Conservative Joan Crockatt won with 37 per cent of the vote, with the Liberals and Greens coming in a close second and third with 33 per cent and 26 per cent of the vote respectively.

Nik Nanos calls these results seismic, "because it was a near-death experience for the Conservatives."

"For the Conservatives probably the key takeaway....is that demographically Alberta is changing, Canada is changing," he told Evan Solomon on Power & Politics. And, Nanos said, it raises the question, who will be in the Conservative winning coalition in the future?

In the U.S. election the Democrats are very well-positioned. The Obama winning coaltion included some of the fatest growing segments of the population, including hispanics.

Now the trend in the U.S. shows a decline in the traditional family make-up that includes a married couple.

(U.S. Census Bureau)

Nanos says part of the Democrats' success can be attributed to their strategy change in response to demographic changes, including crafting policies that speak to the fastest-growing groups of the population.

The trend is very similar in Canada.

(Statistics Canada)

There has been a 25-point drop in families that include a married couple during the past 50 years, from 92 per cent in 1961 to 67 per cent in 2011, according to the latest numbers from Statistics Canada.

Political parties are going to have to adapt as the traditional family changes in Canada.

"The parties that are going to succeed in the future are the ones that get ahead of that, because those are the fatest-growing part of the Canadian population," Nanos said.

It means the Conservatives will have to adapt, if they want to remain the governing party in the future.

But for the Liberal and NDP, Nanos's advice is to take advantage of the change.

The Conservatives have courted the so-called ethnic vote to build their coaltion majority. "It will be interesting to see how the opposition parties try to build their coalition majority in the future," Nanos said.

Green Party Curveball?

There is a curveball in this equation: younger Canadians.

Nanos says the Greens were much more effective in reaching out to "the tech-savy, web 2.0, twitterverse-type Canadians, younger Canadians," during the byelections.

"From a long-term perspective, it's probably a very good strategic move," Nanos said.

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Navy spy Delisle's top secret security check was overdue

Canada's most active spy might have been caught almost a year sooner if the military and CSIS had followed their own mandatory security check rules, documents obtained by CBC News show.

And Sub-Lt. Jeffrey Paul Delisle might still be swapping secrets with the Russians for cash if not for a tip from the FBI in the United States, suggests information contained in three search warrants that were executed on Delisle's home, car and the ultra-secret navy intelligence facility in Halifax where Delisle worked, HMCS Trinity.

The first hint that Delisle was the central figure in a spy scandal that would rock the Canadian and allied military establishments came in the form of a letter sent to the RCMP from the FBI on Dec. 2, 2011.

"The RCMP gets a letter from Frank Figliuzzi, the FBI's Assistant Director, REDACTED implicating a Canadian military officer. His statement is corroborated by Anthony M. Buchmeier, the FBI's counter-intelligence expert witness," states one of the warrants. (Some portions of the warrants obtained by CBC have been redacted by Canadian security officials.)

The FBI makes it clear that there is one suspect: Sub-Lt. Jeffrey Delisle.

When the FBI tipped off the Mounties, Delisle was the threat assessment officer for the Canadian navy based on the East Coast. His job came with a level 3 top secret security classification — the second highest possible — that gave him access to secret information gathered by the CIA, the FBI, CSIS and British, Australian and New Zealand intelligence services.

But the warrants show that Delisle's top secret security clearance had lapsed before he was transferred to Trinity in August 2011. The transfer came after Delisle was promoted to an officer, giving him access to more classified material.

"Jeffrey Delisle's security clearance is Level III — TOP SECRET and is currently being updated. The last information request made to approve this clearance was completed on March 22, 2006," the warrants state.

The Defence Department has confirmed to CBC that level 3 security classifications are supposed to be updated every five years. Delisle's should have undergone the rigorous security process in March 2011, five months before he moved to Trinity. But that check never happened, and the warrants don't explain why.

Might have uncovered problems

If Delisle had been subjected to the mandatory screening process, his loyalty to Canada would have been tested, his devotion to the Canadian military assessed and his financial and emotional health scrutinized.

The process might have uncovered unsettling facts about Delisle that should have triggered a security review long before the five-year mandatory check.

The warrants say that Delisle was in debt in 2009, owing thousands of dollars on a government American Express card. It was a debt he couldn't pay.

"He understands that he has to repay the amount of $3,242.72 and commits to do so," states the warrant. The information came from Delisle's commanding officer at Trinity.

The documents confirm Delisle claimed he incurred the debt because his marriage was falling apart. Debt coupled with a disintegrating marriage often triggers a security review for people involved in intelligence.

But Delisle remained undetected and untested: a man responsible for providing Canadian warships around the world with daily alerts about possible terror attacks and other risks.

23 payments to Delisle

The warrants also show that Delisle's four and half years of betrayal only paid the 41-year-old sailor enough to keep his head above water.

"Between July 6, 2007, and August 1, 2011, funds of US$71,817, split in 23 payments, were transferred to Jeffrey Paul Delisle," state the warrants, which have not been tested in court.

The money was transferred via Western Union and cashed by Delisle at Money Marts. The documents say the money was sent by people in Russia and in Ireland.

The warrants name Sergey Shokolov, Fedor Vasilev, Andrey Orlov and Mary Larkin as the people who sent Delisle money orders. The warrants don't explain who they are or who they work for, state that Larkin is using a fake name.

Despite his known money problems, Delisle gave notice to his commander that he was going to vacation in Cuba and Brazil in September 2011. Even these expensive sojourns didn't raise a red flag to the military.

Delisle travelled to Brazil to meet with his Russian spymaster, who paid him $50,000. His Russian handler also offered him a new job as a go-between with other Russian agents in Canada.

Walked into Russian Embassy

When Delisle returned to Canada, a border services agent in Halifax thought the five-day trip and the amount of money Delisle carried on his return was odd. The border guard reported his suspicions to his superiors, but there is no information in the warrants to suggest the navy took action.

It had been in 2007 that Delisle walked into the Russian Embassy in Ottawa on a summer afternoon. He agreed to supply Russia with secret information for money. On the 10th of every month he would upload untold megabytes of information he had downloaded onto a USB stick while at work in Trinity.

It was only after the FBI alerted the RCMP about Delisle that the navy began his overdue security clearance check. CSIS is responsible for conducting the security on military personal.

In a surprise move, Delisle pleaded guilty in October to passing secrets to the Russians. His guilty plea means that the whole story behind the leaks will never be heard in court.

Delisle, who still holds his rank and receives a salary from the navy, will be sentenced for his crime on Jan. 12, almost a year to the day he was arrested.

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Calgary byelection a primer for vote splitting

In a textbook case of vote splitting, Conservative candidate Joan Crockatt won the federal byelection in Calgary Centre Monday night with 36.9 per cent of the vote, 21 points below the 57.7 per cent victory of the former Conservative MP who resigned the seat.

She will join a dozen or so Conservative MPs who won their ridings by fewer than 1,200 votes, but what stands out about this particular squeaker is that it happened in Calgary, in a seat once considered one of the safest in the Conservative heartland.

But Crockatt's nail-biter win likely won't dent her career in Ottawa. In a first-past-the-post system, coming first is all that matters.

"We tend to forget [margins] very, very quickly" said Harold Jansen of the University of Lethbridge. "It will be a story for a day or two."

But the closely fought byelection, as well as the Green Party's close second in Monday's Victoria byelection, is perhaps part of a trend that shows the so-called progressive vote is now split three ways, rather than two, adding in the Greens as the third prong.

In Calgary, Liberal Harvey Locke came a close second at 32.7 per cent, followed by the Greens' Chris Turner, who took a surprising 25.6 per cent of the vote, and the NDP's Dan Meades trailing badly at 3.8 per cent.

The Green candidate's showing in Calgary means that "the Greens are a serious competitor with the NDP for the left-of-centre vote," said Jansen.

Blogger David Climenhaga of albertadiary.ca, who considers himself a progressive voter and who once worked closely with Crockatt, thinks the Green Party is now in the position of being the spoiler.

"If I were a Tory, I'd want to donate to the Greens right away."

'The Green Party is not a small party'

Federal Green Party Leader Elizabeth May said at a press conference Tuesday, "I'm encouraged that I think we've proven that the Green Party is not a small party, not a blip, or that my seat is the only one we'll ever win."

She complained that when the byelections were first announced, most of the media didn't even mention who the Green candidate was.

May also said, somewhat surprisingly, that the calibre of the Green candidates in Calgary Centre and Victoria was such that they may not have considered even running for her party as recently as 2011. The Green tide is rising, she seemed to be saying. What she didn't say is that she could now potentially be a power broker in any discussions about electoral co-operation between the three mainstream non-Conservative parties.

Jansen thinks that the Greens' buoyancy could have been due, partially, to Crockatt's "lack of effort" in the campaign, particularly her no-shows for a lot of the debates.

Duane Bratt, of Mount Royal University in Calgary, says it also helped that the Greens' Turner had many people working for him who had also worked on Calgary Mayor Naheed Nenshi's winning campaign.

And despite Liberal MP and leadership candidate Justin Trudeau's anti-Alberta musings, it probably didn't hurt that he campaigned side-by-side with Harvey Locke at several events, said Climenhaga.

A test for party cooperation

Whatever the reasons, Calgary Centre neatly replicated the popular vote across the country in the last federal election.

"I think it will become a real test on party co-operation," said Bratt of the vote split Monday night, but noted the byelection was not the time or place to come together. "How could they co-operate at a byelection in Calgary when they haven't even talked at a national level? But this may drive the national level a bit more."

Jansen thinks that what happens in the next federal election, almost three years away, has more potential to be the catalyst that will force a merger or co-operation agreement. "That discussion is going to reignite [now], but I'm not convinced that will spur anyone to much action on the basis of a byelection."

What the results of the Calgary Centre byelection might do is simply further frustrate the 60 per cent of voters who did not vote Conservative in the last election. This could be a cue for Liberal Party leadership candidates, who might recall that the NDP's Nathan Cullen attracted a lot of support due to his co-operation policy when he ran for his party's leadership.

Liberal MP Joyce Murray, who declared her candidacy for the Liberal leadership Tuesday, has suggested run-off nominations for progressive candidates in close ridings.

Trudeau has said he supports the concept of preferential voting, in which voters mark their second (and third or fourth) choices on their ballots.

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Will a new Bank of Canada governor shake up interest rates?

Mark Carney's successor as governor of the Bank of Canada is not expected to implement a radical change in interest rate policy and most likely will hold the current underlying philosophy, which includes a hawkish attitude toward inflation.

Speculation has already begun about possible candidates to replace Carney, who announced on Monday that he will step down next June to become the next governor of the Bank of England.

But it's unlikely that the new Bank of Canada governor will diverge from Carney when it comes to setting interest rates here, says Louis Gagnon, a finance professor at Queen's University School of Business.

"In this business you're either hawkish or dovish. Hawkish people are very suspicious of inflation and dovish people are slightly more accommodating. [Carney] is in the hawkish camp," Gagnon said.

"I think the Bank of Canada as an institution, not only the governor, but the body, is hawkish. I'd be very surprised if they were to select someone who has a different philosophy because that person would not sit well with that group of people."

The Bank of Canada has a two per cent target for inflation, which means that if inflation should exceed that level interest rates would be increased to keep it in check. With the Canadian economy growing slightly — the OECD yesterday predicted moderate growth for Canada in 2013 — inflation might go up as well, which means the next governor could end up raising interest rates.

The Paris-based Organization for Economic Co-operation and Development said in its report the Bank of Canada may need to start raising interest rates from near record lows by the latter half of 2013.

However, Gagnon said that such a move shouldn't be interpreted as a new governor having a different policy objective than his predecessor.

"If [Carney] saw that inflation rose consistently above the two per cent mark, he'd most certainly increase interest rates."

As for governor contenders, Gagnon said there's no pecking order right now and that it will be a long time before a shortlist is created.

He said the candidate must have a deep and solid understanding of the macro economy, the capital marketplace, financial markets and the overall banking system.

"Monetary policy is so crucial. It's central to everything. It establishes the short-term interest rate, which itself is the starting point of the credit marketplace.

"So credit markets take their queues from monetary authorities. And so you have to have a very, very solid understanding of all these dimensions."

The board of the Bank of Canada vets candidates for the governor's job and comes up with a short list, from which the government chooses.

Finn Poschmann, vice president of research at the C.D. Howe Institute, said that with Carney leaving after just over five years in a seven-year term there may be an incentive for the board to look for continuity.

This is one of the reasons that Tiff Macklem, the senior deputy governor at the Bank of Canada, has been suggested as a leading candidate. Macklem has been with the Bank of Canada for a number of years, and also spent time in the finance department.

"There's of course no shortage of qualified possible contenders. But with continuity an incentive if not an imperative then you look inside for an experienced hand," Poschmann said. "They don't have to look very far for someone with the right set of experiences, both through Tiff's work on previous jobs including the department of finance."

If continuity is important, then Bank of Canada deputy governors Agathe Côté and Timothy Lane could also be up for consideration.

Another possible contender is Jean Boivin, the associate deputy minister of finance and former deputy governor of the Bank of Canada.

Don Drummond, TD Bank's former chief economist, who spent years in senior roles at the department of finance, could also be a candidate. But Drummond said on Monday that he wasn't interested in the job, Bloomberg News reported

Economic analyst Patti Croft said Julie Dickson, who heads the Office of the Superintendent of Financial Institutions Canada, would be her top pick.

"Her experience, expertise on the regulatory side would be a wonderful addition," Croft said. "It's something Mark Carney was very interested in. It was one of his comparative advantages and she has it in spades."

Croft also said Stephen Poloz, president and chief executive officer of Export Development Canada, who is an economist with global experience, would be a good choice.

"The important thing is there's a remarkable pool of talent they can draw from," Croft said.

With files from The Canadian Pres

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Ex-astronaut Marc Garneau to launch Liberal leadership bid

Former astronaut and Montreal MP Marc Garneau is widely expected to announce Wednesday that he will be a candidate for the Liberal leadership.

It would be hard to imagine why Garneau would hold two news conferences, one in the morning in his riding, and then one mid-afternoon in Ottawa, if he's not running.

When someone tweeted to ask whether Garneau would be "window dressing" in a contest where he will run against Justin Trudeau, he answered, "Do you really think I would take on a huge personal commitment to be window dressing?"

Garneau will add another kind of celebrity to a race that's been dominated by Trudeau, who is often referred to as the "rock star candidate."

What other leadership contender has two high schools named after him, as Garneau does? Who else was once asked by the Montreal Alouettes to try out for their team, as he revealed on Twitter during the Grey Cup furor.

Garneau, born in Quebec City and a Royal Military College graduate, became a naval officer after getting his doctorate in engineering. In the mid-80s he became one of six Canadian astronauts (out of a field of 4,000 serious applicants) and flew his first shuttle mission in 1984. His biography on his website says he's logged 644 hours in space.

In 2001, he became head of the Canadian Space Agency and left in 2005 to enter politics. He lost his first election in 2006, but in 2008 won the riding of Westmount-Ville-Marie. He is the Liberal House Leader and the party critic for science, industry and technology. In his political career, he has championed the idea of a commissioner for children and young people.

Garneau becomes the third sitting MP to enter the race, after Justin Trudeau and B.C. MP Joyce Murray.

Garneau has 'intellectual heft'

One supporter says he is attracted to Garneau because of his "intellectual heft." A Liberal insider says that if Trudeau falls flat on his face, then Garneau will be there as a solid, credible candidate, and a household name to boot.

At 63, Garneau qualifies as an early boomer, a member of a political age-cohort that ranges from Bill and Hillary Clinton, Mitt Romney, Bob Rae and a number of his seatmates on the Liberal bench. There is a sense of the headiness of what it was like coming of age in the 60s as he relates how he crossed the Atlantic in an 18-metre yacht with 12 others in 1969, the same year, he notes, as Woodstock and the moon landing.

His 8000 Twitter followers don't compare to Trudeau's nearly 170,000, but nothing humanizes him more than some of his tweets, as he obligingly answers questions about life in space. Is there a special space toilet, how does the shuttle's vacuum cleaner work when the shuttle's flying in a vacuum, is there a Velcro strip inside the helmet to aid in nose-scratching? (Answers: yes, it just does, and no).

The other candidates who have declared their leadership bid or their interest are former MP Martha Hall Findlay, Ottawa lawyer David Bertschi, Deborah Coyne, Vancouver lawyer Alex Burton, retired air force colonel Karen McCrimmon, senior government economist Jonathan Mousley, B.C lawyer David Merner, and Toronto lawyer George Takach.

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Tories shoot down NDP motion for defence spending details

Conservative MPs on the defence committee voted down an attempt by the NDP to force Defence Minister Peter MacKay to outline the details of his department's budget cuts in a continuing battle between the government and parliamentary budget officer Kevin Page.

New Democrat defence critic Jack Harris tabled a motion to force MacKay to give specific information to Page about the government's planned $5.2 billion in budget cuts. Page has threatened to go to court in order to get the details.

Conservative cabinet ministers, including Finance Minister Jim Flaherty and Treasury Board President Tony Clement, say Page is stepping outside his mandate and that they provide a number of public documents every year outlining the government's spending. Many of those documents this year were prepared before Flaherty tabled the budget, so the cuts weren't included in those reports.

MacKay was appearing before the committee to discuss the supplementary estimates for the Department of National Defence, a budget document that can make changes to spending outlined in previously planned spending.

The NDP and Liberal MPs on the committee voted in favour of Harris's motion, but the Conservative MPs outnumbered them and voted it down, denying Page the information he's seeking.

MacKay refused to comment on Harris's motion as he left the meeting, saying it was up to the committee and not up to him.

Earlier in the meeting, Harris tried to ask MacKay about which programs and jobs are being cut.

"We do have significant decreases in operating budget expenditures within your department. The parliamentary budget officer has been trying to get you and your department to identify where they are," Harris said.

No details on what exactly has been cut

Chris Alexander, MacKay's parliamentary secretary, objected to the question, but the committee's Conservative chair James Bezan let the question go ahead.

MacKay referred to $91 million cut after the 2012 spending review, plus $280 million available because of changes to when some equipment will be bought or infrastructure built, as well as fewer mission costs now that Canada has a training mission rather than a fighting force in Afghanistan, but didn't get into details about those changes.

"The department is committed to the effective stewardship of public funds," MacKay said.

The department isn't looking for more money in its supplementary estimates, he said, and has shifted spending within its budget to accommodate the cuts.

The department is still aiming to buy new fixed-wing search and rescue planes, tactical armoured patrol vehicles and surface combatants, MacKay said.

Liberal defence critic John McKay referred to the committee as the fog of war, with Conservative MPs objecting with points of order every time the opposition tried to ask questions.

"You throw up a bunch of non-information, lack of information, absence of information, misleading information, and then you leave," he said.

"For God's sakes, Kevin Page is probably one of the few people on God's green earth who can actually go through not only the budget but supplements and ask the right questions."

Flaherty promised the government-wide budget cuts wouldn't affect front-line services, but Page reported earlier this month that most cuts will hit services on which Canadians rely.

Search plane requirements broadened

MacKay also told MPs Tuesday that the military is finally moving ahead with much-delayed plans to purchase new search and rescue aircraft.

Eight years ago, $1.3 billion was set aside to purchase replacements for the aging fleet of C-115 Buffalos, C-138 Twin Otters and older versions of C-130 transport planes currently on search and rescue duty across the country.

But the procurement process for new planes was halted and otherwise bogged down at several points. Allegations surfaced that the military had tailored the specifications to favour the particular aircraft of only one preferred supplier.

MacKay now says that his department is considering having more than one type of aircraft in its search and rescue fleet.

"We've broadened, in fact, the specs, to include the possibility of a mixed fleet," he said in his committee testimony.

CBC News has learned that the military recently sought approval for $1.8 billion to replace this fleet – $500 million more than the original 2004 estimate for the procurement.

Inflation, plus additional crew and maintenance costs should the military purchase multiple types of aircraft, could factor into the now higher price tag.

Military estimates for the total cost of the new search and rescue fleet – including training, infrastructure, and 20 years of maintenance – approach nearly $4 billion.

with files from James Cudmore

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Alberta premier accused of conflict in tobacco case

Premier Alison Redford, while justice minister, personally chose her ex-husband's law firm for a government tobacco-litigation contract worth potentially tens of millions of dollars in contingency fees, a CBC News investigation has found.

One of Canada's top experts in conflict of interest says Redford was in a clear conflict and should have not made that decision.

Arthur Schafer, director of the Centre for Professional and Applied Ethics at the University of Manitoba, says Alison Redford should have recused herself from the decision-making process in the awarding of a contract to her ex-husband's law firm while she was justice minister. (CBC)

"The minister of justice, as she then was, Alison Redford, in my view behaved unethically and possibly illegally by not recusing herself from making a decision in which she had a private interest, and was in a conflict of interest situation," said Prof. Arthur Schafer, director of the Centre for Professional and Applied Ethics at the University of Manitoba.

Redford did not respond to repeated interview requests over the past few days. Questions were instead directed to current Justice Minister Jonathan Denis. In an email, Denis's executive assistant, Josh Stewart, said "there was no potential conflict of interest" for Redford.

"Ex-spouses are not included in the Conflict of Interest Act and Mr. Hawkes [Redford's former husband] will not be working on this file."

Contract worth $10 billion

As CBC News first revealed in May, the Redford government awarded the tobacco litigation contract — at $10 billion, the largest legal action in Alberta's history — to International Tobacco Recovery Lawyers, a consortium of law firms from Florida, Ontario and Alberta.

The consortium includes the Calgary firms of Jensen Shawa Solomon Duguid Hawkes (JSS) and Cuming & Gillespie. The two firms have close personal and political ties to both Redford and the Progressive Conservative Party.

Lawyer Robert Hawkes, ex-husband of Premier Alison Redford, is a partner in the law firm JSS, and was her transition team leader on her road to the premier's office. (CBC)

Redford's former husband is Robert Hawkes, a partner in JSS, who served as her transition team leader after she won the Progressive Conservative Party leadership race in 2011 and ascended to the premier's office.

Schafer said Redford clearly still shared a close personal relationship with her former husband at the time she made the decision to award the contract to his firm. As a lawyer and justice minister, Schafer said she should have recognized she had a conflict.

"It's a shabby situation when the chief legal officer can't recognize such a clear-cut conflict of interest," Schafer said in an interview with CBC News. "She is responsible for setting the ethical tone for her entire department, and indeed for her government.

"And for the person who is responsible for guaranteeing the integrity and the legal soundness of decisions … for her failing to recognize, or failing to act after recognizing she was in a conflict of interest is worse than shabby — it is shameful."

Redford personally chose firm

Through Freedom of Information, CBC News obtained documents that show Redford knew any of the three firms interviewed for the contract was capable of handling the litigation.

The three firms were:

• Bennett Jones.
• The team of McLennan Ross and Field Law.
• The International Tobacco Recovery Lawyers.

The legal strategy of suing tobacco companies to recover at least some health-care costs associated with smoking began in the United States. The Florida firm that is part of ITRL has extensive experience in that area of law. Bennett Jones, headquartered in Calgary, is already suing tobacco companies on behalf of four provinces.

In a memo dated Dec. 14, 2010, Redford tells Justice Deputy Minister Ray Bodnarek: "I note that the review committee considers all three firms interviewed to be capable of conducting the litigation and believes that while no consortium stood above the others, all three have unique strengths and weaknesses.

"Considering the perceived conflicts of interest, actual conflicts of interest, the structure of the contingency arrangement and the importance of a 'made-in-Alberta' litigation plan, the best choice will be the International Tobacco Recovery Lawyers," Redford wrote.

The documents provide only a hint of what the potential conflict might be.

About a month before Redford's Dec. 10 decision, a senior official writes in an email: "Are any of these firms on our page one list of retained firms involved in significant matters against the Crown? That list should be part of the last briefing we prepared on outside counsel for the Minister." There was a list, but it was blanked out in the documents released to CBC.

CBC spoke, on condition of anonymity, with a lawyer whose firm had sought the tobacco litigation contract. He learned from CBC that Redford had made the decision on the contract. But he said he had no concerns about the objectivity of the process.

Province wanted experienced firm, said government

In an email, the executive assistant to Denis, Josh Stewart, said: "The focus was on acquiring the requisite experience and avoiding competing interests that might conflict with Alberta's litigation interests. Alberta was looking for an experienced law firm or consortium that would be focused on our lawsuit and the best litigation strategy based on Alberta's interests."

Schafer found it "somewhat ironical" Redford considered the other firms to have perceived or actual conflicts, "given that her conflict was the most blatant of all.

"At the time she was making the decision, if the premier of the province or other minister were aware that she was allocating a contract to a firm in which her ex-husband was a member, they should have tapped her on the shoulder and said, 'Alison, this is not a decision you should be making,'" Schafer said.

"'It looks terrible, and it looks terrible because it is terrible. You can't decide this impartially. The decision has to be made by someone who is not biased by a private interest.'"

The documents obtained by CBC News contain no mention of warnings from department officials about a conflict of interest. Schafer said senior justice officials should have recognized the conflict.

"Did none of them warn her that this wrong, that this was morally wrong, that it was unethical, wrong for the department, wrong for the government, wrong for the party, wrong for the people of Alberta?" he asked.

"If nobody warned her, then the failure was on her part as the minister and on their part as civil servants."

Winning firms hired lobbyist before legislation announced

CBC News also obtained documents that show the Florida law firm hired lobbyist Tim Wade, a former executive assistant to several provincial Tory cabinet ministers.

Wade lobbied the departments of Health and Justice — when Redford was justice minister — in relation to the Crown's Right of Recovery Act, the legislation that provided the legal right to sue the tobacco companies.

Lobbyist registry documents show Wade was also lobbying on behalf of the other law firms associated with the consortium: JSS and Cuming & Gillespie.

According to Wade's own declaration to the lobbyist registrar, he began lobbying on May 1, 2009. Hansard shows the first reading of the Crown's Right of Recovery Act was 10 days later, on May 11, 2009.

"I find it very troubling that there was a lobbyist who registered to lobby on behalf of the consortium that won, before the decision to proceed with the lawsuit was even announced," Wildrose Leader Danielle Smith told CBC News in an interview.

Law firm, lobbyist donated thousands of dollars to Tories

CBC News searched public records of political contributions and found JSS, Cuming & Gillespie, and Tim Wade, the lobbyist, gave tens of thousands of dollars to the PC Party, to Redford's riding, and to her leadership campaign before and after her December 2010 decision to award the tobacco litigation to the consortium.

She resigned from cabinet in February 2011 when she entered the Tory leadership race.

Between 2008 and 2010, Hawkes donated more than $4,000 to the PC Party and PC riding associations. Nearly $1,900 was donated to Redford's Calgary-Elbow riding, where she was first elected in March 2008.

Glenn Solomon, a senior partner at JSS, gave more than $3,000 to the PC Party, of which nearly $1,900 went to Calgary-Elbow between 2008 and 2010.

But Carsten Jensen, one of the lead JSS lawyers on the tobacco litigation file, donated more than $2,700 to provincial Liberal Party between 2004 and 2010.

James Cuming gave $875 to the PC Party and another Calgary Tory riding association. He gave nothing to Redford's riding. But during her 2011 leadership campaign, his firm gave Redford $13,000.

Tim Wade, or his consulting firm, gave nearly $29,000 to the PC Party and various riding associations between 2007 and 2010, including $800 to Calgary-Elbow in 2008 when Redford was first elected.

Firm has deep roots in PC Party

Hawkes and Glenn Solomon have long, deep roots in both the federal and provincial PC parties.

Provincially, Hawkes acted as the main organizer for five annual Calgary Leader's Dinners. He also served on the party's finance committee.

Solomon has served as a director of several federal riding associations and served on the executive of the Calgary-Elbow riding association when the riding was held by Ralph Klein.

The Wildrose leader told CBC News she will be filing a complaint with both the ethics commissioner and the lobbyist registrar.

"This is something that I think needs to be taken very seriously," Smith said. "We haven't had very many investigations in this province into conflicts of interest, into ethics violations, into violations of the lobbying registry, and I think this is something that needs to be investigated."

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Generic OxyContin approved for 6 drugmakers

The patent for OxyContin, which was pulled from the market earlier this year due to concerns about abuse, expired Nov. 25, opening the door for generic drugmakers to produce less-expensive versions of the painkiller. (Canadian Press)

Six generic pharmaceutical companies got the green light Monday to make the painkiller oxycodone, previously marketed under the brand name OxyContin.

Health Canada made the announcement Monday afternoon.

Health Minister Leona Aglukkaq was under pressure from some provinces to forbid the generic form of the drug because it has been so widely abused across the country before its maker pulled it from the market earlier this year.

But Health Canada points out in its decision that the drug is safe and effective when used as prescribed.

Last week, the minister announced further restrictions on the drug which will force manufacturers and pharmacists to report spikes in sales or changes in distribution patterns.

As well, Health Canada wants pharmaceutical companies to better educate health-care professionals and the public on the potential risks of this painkiller as a condition of their licence to make the drug.

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Refugees may turn to province for health needs, officials say

Jason Kenney, the federal minister responsible for immigration, says it is OK for provinces like Saskatchewan to provide health benefits for people who are not covered under programs for refugees.

Kenney was responding to concerns raised after a Saskatoon man, in need of drugs related to chemotherapy, discovered the federal government would not be footing the bill due to his status as a refugee claimant.

Saskatchewan, however, has since stepped in to cover the man's health care costs.

Kenney said Monday the province's move is fine by him.

"If they want to make exceptions, if they want to provide expansive health insurance for foreign nationals who are here, out of status or temporarily, they are welcome to do so," Kenney said Monday in the House of Commons. "We have no objection to that whatsoever."

Kenney noted that no one can be declared a refugee until they are deemed so after going through an application process.

Saskatchewan's Minister of Health, Dustin Duncan, said Monday that directives have been issued to health regions in the province to provide treatment for all urgent health needs of people going through the refugee process.

"We don't want health regions and our hospitals and acute care facilities to be turning people away, particularly those in emergent and urgent need of care," Duncan said.

Duncan added the province is still trying to change the federal government position on cuts to health benefits for refugee claimants and found Kenney's attitude unhelpful.

"That's unfortunate that that's the tone that the federal minister has taken," Duncan said in Regina. "It's the federal government, not the provincial government, that runs the refugee system and so we have no way to dictate or determine how long that process takes."

Duncan noted it can months or years for a person seeking refugee status to learn his or her fate.

"To then leave that individual in limbo like this, that's discouraging to hear that," he said.

Ottawa announced changes in the spring to the Interim Federal Health Program, which provides temporary health coverage for protected persons, refugee claimants and other groups not eligible for provincial health insurance.

Under those changes, some refugee claimants saw cuts to their drug, dental and vision coverage. Additionally, those whose refugee claims are rejected, and those from a yet-to-be defined list of "safe" countries, will only receive medical care if their condition is deemed a risk to public health or safety.

The federal government said it hopes the changes will deter bogus refugee claims and ensure failed asylum seekers don't take advantage of Canada's free health care.

Duncan added he is writing Kenney because the changes have confused health officials.

With files from The Canadian Press

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Greg Weston: Carney a coup for U.K., loss for Canada

The announcement that Canadian economic wunderkind Mark Carney will soon be the only foreigner to become governor of the Bank of England in its more than three centuries has caused much jaw-dropping in high places and digital gasping on both sides of the ocean.

"Dip me in maple syrup — what a shock!" wrote one British wag on the Guardian's website.

Financial and political analysts here and in the U.K. almost unanimously declared the appointment of the Bank of Canada governor a huge surprise, albeit equally united in their confidence Carney is a good choice for the London job.

And if his appointment is causing a stir in England, imagine the rattling of tea cups when British high society discovers that the fellow from the colonies getting close to $1 million a year to head the Bank of England actually prefers lunching at a burger joint and his favorite music is the hard rock of the '70s band AC/DC. Splendid!

Mark Carney will take over the Bank of England at a crucial time for Europe's financial system. He has denied interest in a future run at the Liberal Party leadership. (Fred Chartrand/Canadian Press)

In this country, Carney has become something of an economic superstar, widely credited with helping to steer the Canadian economy through the worst of the 2008 global financial crash and back to relative stability.

On the world stage, no other Canadian public servant comes close to Carney's international acclaim.

In 2010, Time magazine named him one of the world's 100 most influential people, while his peers chose him to head the Swiss-based Financial Stability Board charged with reforming the global banking system.

Liberals look for a saviour

At age 47, the affable economist with the giant intellect and wry smile moves from governor of the Bank of Canada to its counterpart in London as the youngest ever head of the British central bank, colloquially known as the Old Lady of Threadneedle Street.

And that has some forever hopeful Liberals in this country clinging to their dream that Carney will someday return to Canada, enter federal politics, and lead their party back from the electoral wilderness.

They excitedly point out that governors of the Bank of England are usually appointed for eight-year terms, but Carney would only agree to five, starting on Canada Day next year.

That would make him available again to return to Canada at age 53, three years after the next federal election and a year before Canadians headed to the polls again.

His cheerleaders figure that if the Liberals lose the election in 2015 and the one after that in 2019, whoever wins the leadership next April will be toast. Enter Mark Carney.

Until a month ago, a group of prominent Liberals was actively trying to recruit Carney to run for the leadership this time. And then the rumours started in public, and he finally said a firm, no, not interested.

But what has given his would-be Liberal recruiters new hope in the latest announcement of his appointment to the Bank of England is he flatly denied those rumours, too, as late as September.

On Monday, Carney confirmed he had turned down two offers from the Bank of England, but apparently got a third one he couldn't refuse in the past few weeks.

He laughed at a question about running for the Liberal leadership.

Restless for new challenges

Carney's term at the Bank of Canada isn't up until 2014, and it is highly unusual for a governor to leave early.

That has spawned speculation in political and media circles he was butting heads with the Harper government.

But we have spoken to a number of people close to Carney who say he is simply restless for new challenges — and that's certainly what he will face as head of the Bank of England, especially while the European economies are in crisis.

Those who offered Carney the job clearly recognize his talents, reputation and credentials.

In particular, he brings to the job a rare combination of experience in both the private sector and government — years at the Wall Street investment giant Goldman Sachs, followed by a stint in the top ranks of the Canadian Finance Department before joining the Bank of Canada.

He is also no stranger to the U.K., having spent more than a decade there first at Oxford, then as a senior investment banking analyst. His wife has dual British-Canadian citizenship, and Carney himself will soon have the same.

The announcement of his latest appointment was made Monday by Chancellor of the Exchequer George Osborne.

Osborne, the U.K. finance minister who personally recruited Carney, could hardly have been more direct in his praise.

He told the British Parliament that Carney is "quite simply the best, most experienced and most qualified person in the world to be the next governor of the Bank of England."

Prime Minister David Cameron was equally effusive: "His distinguished record on economic policy, the high regard of his international peers and the leadership he has shown on the global economic crisis make him the exceptional person for this job."

The BBC's business editor, Robert Peston, dismissed complaints that the new central bank chief is a foreigner.

"We live in a global village and there's every reason to opt for the best the global gene pool has to offer," Peston wrote. "Only time will tell whether Carney is the right choice, but in my book this is quite a coup."

Alas, Britain's coup is Canada's loss.

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What's next for Toronto Mayor Rob Ford?

A ruling by an Ontario court judge that forces Rob Ford to vacate the Toronto mayoralty has opened up a legal and political quandary in Canada's largest municipality.

Having found that Ford had violated provincial conflict of interest rules for municipal politicians, Ontario Superior Court Justice Charles T. Hackland gave the mayor two weeks in office before the ruling takes effect, saying the decision "will necessitate administrative changes in the City of Toronto."

But if yesterday is any indication, those two weeks will be filled with intense legal speculation about whether Ford will seek a stay of the Hackland ruling while an appeal is heard, not to mention political intrigue as Ford opponents and supporters jockey to figure out how to replace him.

If he does go, there are currently two options on the table: appoint a caretaker mayor to fill the remaining two years of the term or call a byelection. And while it is early days yet, some councillors, including some previously loyal Ford supporters, are beginning to make their preferences heard.

As for the mayor, Ford has said he will appeal the decision at a divisional court. But in order to remain mayor while the appeal is going forward, he would likely also have to apply for a stay of proceedings.

Ford's legal team could either ask that of Hackland, the lower court judge who made the initial decision, or the court they are appealing to.

"They'd have to make the tactical decision, who's more likely to hear them out," Stephen D'Agostino, who specializes in municipal law, told CBC News. "Part of the consideration is going to be what are the chances on appeal.

"If it looks like it's a pretty iffy appeal, the court might say, 'We'll hear the appeal but you're out [of office].' On the other hand, if it's controversial but looks like it's a good appeal, a court might be more cautious."

Appeal could take months

If a stay was granted, Ford would continue to be mayor for the duration of the appeal and legal process, which could be several months. His term is supposed to end in December 2014.

Yet there seem to be differing opinions over whether such a stay would be granted. John Mascarin, a municipal law expert who had predicted the judge's ruling, suggested on Monday that Ford would get a stay.

But D'Agostino told CBC News that he believes granting a stay to Ford would be unprecedented.

"I've been involved in conflict of interest work for 15-odd years," he said. "I've never seen it done.

"The normal appeal rules would allow someone to apply to court to stay the decision that's being appealed, but I have never seen it done," D'Agostino said.

If a stay is not granted, the City of Toronto Act states that city council would have 60 days to either fill the vacancy by appointing somone to be mayor or by passing a bylaw requiring a byelection be held to fill the vacancy.

The Globe and Mail reported that council had earlier passed a bylaw that would ensure that only an elected councillor could be appointed mayor under these circumstances, but it's unclear whether that bylaw would supercede the provincial act governing municipalities should there be a challenge.

Confusion over when Ford can run again

Still, there seems to be some confusion surrounding part of the judge's ruling. In one of the last paragraphs, Hackland wrote that he would not disqualify Ford from running for or holding office "beyond the current term."

The question is what the judge meant by "beyond the current term" and whether that refers to Ford's term as mayor, scheduled to end in December 2014, or whether he could run again immediately if a byelection were to be called.

Mascarin said that he believes Hackland clearly meant to bar Ford from running for office until the current council term is over in 2014.

But Alan Lenczner, the lawyer who represented Ford in the conflict hearing, told CBC News in an email that he believes the mayor can run in a byelection if one is called ahead of the 2014 municipal election.

D'Agostino said that it's unclear what Hackland meant. "If I just read that one paragraph, I'd walk away saying that the court meant to the end of the term — as in an election term.

"But because I read the whole decision, I read that and it kind of jarred me because there's no real discussion about that, it just sort of comes out of the blue. It's really a well-worded, well-thought-out decision, and I would have anticipated some discussion on it. So that's what I'm left with, a bit of a question mark."

It is possible the two sides may call the judge's assistant to set up court time or a conference call with the judge for clarification.

As for council's option to appoint someone to fill the mayoral void, the provincial act doesn't specify who that person should be — meaning it could be anyone of voting age, and not necessarily someone from city council.

Adding another twist, if a stay is not granted, and Ford is booted out of office, it's possible he could be reinstated if the appeal court sides with him, meaning the person who had replaced him as mayor would in turn be replaced by Ford at some future date.

Byelection would cost $7M

Meanwhile, many city council members were cautious in their remarks about the possible mayoral vacancy and which option they might consider — a $7-million byelection or the appointment of an interim mayor until 2014.

Some took to Twitter to say that Ford was entitled to his appeal process, while others were raising names of those who might succeed the mayor.

Deputy Mayor Doug Holyday told CBC News that he'd favour an appointment if that person's agenda was similar to the mayor's. He later said he wouldn't rule out a run himself if a byelection were called.

Coun. Mike Del Grande, another Ford supporter on council, told the Globe and Mail that he would like to see the fiscally conservative Holyday in that post if council was to go the appointment route.

But Coun. Paula Fletcher told the Globe and Mail that she thought two years is too long for a "caretaker" to run the city.

The ruling has already prompted some to reconsider their political future. Coun. Giorgio Mammoliti, a loyal Ford supporter, quit the mayor's executive committee, saying his constituents have asked him to put some distance between himself and the embattled mayor.

With files from The Canadian Press

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Tories and NDP hold on to seats in tight byelections

The Conservative Party won two of three federal byelections Monday night, holding on to its seats in Calgary Centre and Durham, Ont., while the NDP kept its seat in Victoria.

None of the ridings had been expected to change party hands, though two of them turned into close races.

NDP candidate Murray Rankin won in Victoria, holding off a surprising challenge from the Green Party's Donald Galloway.

Rankin won with 37.2 per cent of the vote to Galloway's 34.3, in a race that seesawed throughout the night.

"We knew this would be a tough fight," said federal NDP Leader Tom Mulcair, who was on hand in Victoria to congratulate the newest member of his caucus.

The NDP is a party at the centre of Canadian life, and one that is on the move, Rankin said. "I see the faces of a great national party, steadfast in our determination to build a better Canada."

In Calgary Centre, the Conservative Party held on to what has traditionally been one of its safest ridings in the country. Tory candidate Joan Crockatt won with 36.9 per cent of the vote to Liberal Harvey Locke's 32.7 per cent.

"Conservative support in Calgary Centre remains strong and growing," the beaming victor maintained after arriving to a cheering throng at her campaign headquarters.

"It was a nail biting evening but I'm a new candidate, I'm not an incumbent and byelections are always challenging for a majority government."

Byelections do tend to be hard on sitting governments, but Calgary Centre wasn't supposed to be a problem for the Harper Conservatives.

The riding hadn't seen a three-way race since Reformers and Progressive Conservatives were fighting for the right to roast a Liberal in the early 1990s. Locke's second-place finish matched the Liberal party's 1993 high-water mark in Calgary Centre.

Quoting a line from the Leonard Cohen song "Anthem" -- "There is a crack in everything; that's how the light gets in" -- Locke said, "I think we made a crack."

Liberals, Greens challenge Tory dominance

The combined conservative vote Calgary Centre hadn't fallen below 50 per cent since 1972.

But Crockatt's vocal support for the upstart Wildrose party in the last Alberta election appeared to divide the local conservative base, with some openly defecting to support Locke.

"I think that the question for me as a Liberal that has been answered tonight is can a Liberal run competitively in Calgary and the answer is unquestionably, yes."

It seemed the Greens' Chris Turner was the deciding factor, with a strong showing that likely took votes away from the Liberals in a riding that's been painted Tory blue since the riding was formed in 1968.

"We were defeated at the polls, but we did not lose anything today," Turner said in a statement.

Turner's strong campaign may have been aided in the final stretch by Liberal gaffes elsewhere.

First, Liberal MP David McGuinty was quoted calling Alberta MPs "shills" for the oil industry and suggesting they "go home" and run for town council if they want to be so parochial.

Then a November 2010, French-language interview by Justin Trudeau, the Liberal leadership heir apparent, surfaced in which he stated that "Canada isn't doing well right now because it's Albertans who control our community and socio-democratic agenda."

Trudeau apologized but not before federal Conservatives had a field day, stalling Liberal momentum in Calgary Centre and making the Green option -- and a welcome Liberal-Green vote split for Crockatt -- more viable.

Conservative candidate Joan Crockatt speaks to supporters following her win in Calgary Centre on Monday evening. (Jeff McIntosh/Canadian Press)

Martha Hall Findlay, another Liberal leadership hopeful who, like Trudeau, spent time in the riding during the byelection, said Monday that perceptions of Calgary's political uniformity are changing.

"I've been involved with Calgary long enough to know it's not something that's all of a sudden changed," she said.

"I think what has changed is that there is a sense that maybe there's an opportunity for a representation that actually reflects who Calgarians are."

Comfortable win in Durham

Conservative Erin O'Toole was the runaway winner in Durham, Ont., retaining the Tory seat in the riding northeast of Toronto with 50.7 per cent and all polls reporting. The seat had been held by onetime Conservative MP and cabinet minister Bev Oda before she resigned in July under a public uproar about her ministerial expenses.

O'Toole said Oda's spending controversies weren't a major concern for voters he met while campaigning.

"That came up less and less as we got our message out and as people got to know me as a candidate and realized I'm from this community," said O'Toole, whose father John is a member of the Ontario legislature.

Here's a quick look at the results in all three three contests:

Calgary Centre

What: A Tory stronghold that sits next to Prime Minister Stephen Harper's riding.

Why: Veteran Conservative MP Lee Richardson resigned to take a post as chief of staff to Alberta Premier Alison Redford.

Main candidates:

• Joan Crockatt, Conservative (36.9 per cent).
• Harvey Locke, Liberal (32.7 per cent).
• Chris Turner, Green (25.6 per cent).
• Dan Meades, NDP (3.8 per cent).

Voter turnout: 29.4 per cent.

Victoria

What: A Vancouver Island riding once held by Sir John A. Macdonald, but more recently held for more than 10 years by the Liberals until it was won by the NDP in 2006.

Why: New Democrat Denise Savoie resigned due to health issues.

Main candidates:

• Murray Rankin, NDP (37.2 per cent).
• Donald Galloway, Green (34.3 per cent).
• Dale Gann, Conservative (14.4 per cent).
• Paul Summerville, Liberal. (13.2 per cent).

Voter turnout: 43.9 per cent.

Durham

What: A riding northeast of Toronto that was held for more than a decade by the Liberals, but has been Conservative since 2004.

Why: Former Conservative cabinet minister Bev Oda resigned last summer after a series of controversies.

Main Candidates:

• Erin O'Toole, Conservative (50.7 per cent).
• Larry O'Connor, NDP (26.3 per cent).
• Grant Humes, Liberal (17.3 per cent).
• Virginia Ervin, Green (4.1 per cent).

Voter turnout: 35.8 per cent.

With files from CBC's Hannah Thibedeau and The Canadian Press

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Climate financing to run out unless UN talks find solution

A $100-billion-a-year promise from rich nations — including Canada — to help poor countries deal with climate change is still unfunded as of the end of 2012, a new report shows.

And a second fund, meant to jump start the promise, will run dry by Dec. 31.

Canada has given $400 million annually for the last three years to the latter climate fund to provide a down payment for poor countries to begin the work of cutting emissions and adapting to the inevitable effects of global warming.

But that fund drew only three years' worth of financial commitments from donor countries, for a total of $30 billion that will be drained by year's end.

Much of this money was recycled from other aid programs, says the study by Oxfam, an international non-governmental organization.

The larger promise made by rich countries in Copenhagen in 2009 to raise $100 billion a year by 2020 remains in the wind.

"After a year of extreme weather, developing countries face a climate 'fiscal cliff' at the end of 2012, as fast-start finance expires and the Green Climate Fund remains empty," Oxfam said.

When environment ministers, including Canada's Peter Kent, meet in Doha for United Nations climate negotiations next week, they will need to figure out how to come up with the rest of the money, said Christiana Figueres, the top UN climate change official.

"Governments have agreed it is imperative to stay at least below a two degree average global temperature rise to avoid the worst impacts of climate change," she said in a statement to set up the talks. "But they know this cannot be achieved without further dramatic transformation in energy production and use and without effective support to developing nations so they can build their own sustainable futures."

At the widely watched climate talks in Copenhagen in 2009, rich countries agreed to a 10-year financing plan to integrate developing countries into the global effort to reduce emissions and handle climate change.

Donors came forward to provide $30 billion for the first three years of the plan. But Oxfam's analysis shows they did not live up to their commitment to provide new funding that would be balanced between efforts to mitigate climate change on the one hand and adapt to climate change on the other.

Funding at risk

Instead, only 33 per cent of the financing was new money, raising concerns that donors siphoned off money from other needy causes.

Only 21 per cent of the funding went to support adaptation to global warming.

That's troubling, because the poorest of poor countries have very low emissions but bear the brunt of extreme weather events increasingly caused by global warming, said Mark Fried of Oxfam Canada.

He said only 10 per cent of Canada's money went towards adaptation.

Canada has yet to earmark $183 million of its $1.2-billion pledge for the fast-start program, and Fried wants Kent to put it towards adaptation efforts.

But the larger problem is the lack of funding starting in 2013.

As ministers hash out ways to sign a meaningful climate agreement by 2015 that would go into force in 2020, they also have to deal with raising $100 billion a year, Figueres said.

Oxfam says it will be a tough discussion since so many rich countries are dealing with fiscal problems. In Canada, the federal government has shown no indication it will find more money for the climate financing fund after the end of this year.

That's why countries should be looking at a tax on international shipping or on financial transactions, said Tim Gore, Oxfam International's climate change policy adviser.

"If leaders come to Doha with no new money, the Green Climate Fund risks being left as an empty shell for the third year in a row," he said.

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