Senate HR official wrapping up testimony at Duffy trial

The Crown in the Mike Duffy Senate expenses trial is again questioning a Senate human resources official, only the second witness to testify so far.

Sonia Makhlouf is being questioned by Crown prosecutor Jason Neubauer. She has spent the last two days in an Ottawa courthouse facing cross-examination by Duffy's lawyer Donald Bayne.

Duffy has pleaded not guilty to 31 charges of fraud, breach of trust and bribery related to expenses he claimed as a senator and later repaid with money provided by the prime minister's former chief of staff.

Today marks the eighth day of the trial. But the slow pace of the witness testimony prompted Ontario Court of Justice Judge Charles Vaillancourt to say on Wednesday he expected the trial would go on longer than the 41 days allotted.

Neubauer indicated on Wednesday he would need only about half an hour to question Makhlouf Thursday before the next witness is called.

Makhlouf's job was to assess Senate research contracts and ensure services being billed pertain to parliamentary business.

On Monday, her testimony was used by the Crown to build its case that Duffy charged taxpayers for non-Senate business through contracts with his friend Gerald Donohue. Those services included payments to a volunteer, a makeup artist and a personal trainer, and for an enlarged photo of family members and one of former U.S. president's wife Barbara Bush.

But Bayne has battled back. Under cross-examination, Makhlouf admitted the rules relating to a senator's office budget were vague and that senators have broad discretion over how money is used and over who they hire. She also conceded there was virtually no oversight of research work conducted by contractors on behalf of senators.

Bayne also argued the services expensed by Duffy that have been questioned by the Crown were all appropriate. He said that it may have been "administratively irregular" for Duffy to have some of these services paid as part of a research contract, but the work could be considered Senate related. Makhlouf agreed.

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Senate expenses 'administratively irregular' but appropriate, Duffy lawyer argues

Mike Duffy's lawyer attempted to swat away some of the accusations that his client billed for expenses not related to parliamentary functions, arguing that they may have been "administratively irregular," but appropriate work-related costs nonetheless.

Donald Bayne battled back against testimony given earlier this week by Sonia Makhlouf, a Senate human resources official, whose job it was to assess Senate research contracts and ensure the services being billed pertained to parliamentary business.

Duffy has pleaded not guilty to 31 charges of fraud, breach of trust and bribery related to expenses he claimed as a senator and later repaid with money provided by the prime minister's former chief of staff. On Wednesday, Ontario provincial court Judge Charles Vaillancourt told the court that he expected the trial would go on longer than the allotted number of days (41).

Today marked the seventh day of the trial, and Makhlouf has been only the second witness to testify.

Bayne went over Makhlouf's previous testimony. She had been asked on Monday if contracts would have been approved if the description of services included a $500 payment to a volunteer, a $500 payment to staff, payment for physical fitness training and payment for a makeup artist. She has said they would likely not have been approved because none of those services are considered parliamentary work,

She was also asked if photographic services, including enlarging a picture of Barbara Bush or an enlargement of an image of Duffy's daughter and grandson, would be approved.

Again, Makhlouf said it "has to be in the context of Senate business related."

But Bayne suggested these payments were all appropriate and expanded on those services. The expense for the physical fitness training was actually for a consultant to help Duffy with a project regarding the health and fitness of Canadians, Bayne said.

He suggested the makeup cost was for Duffy to attend a G8 meeting at the invitation of Prime Minister Stephen Harper. 

Bayne said a $500 payment was to receive consulting services from a qualified expert on reputation management. Another $500 payment to a volunteer, Bayne said, was for office work conducted over five months.

And he also pointed out that photographs and development of films are valid uses of senators' expense budgets and that the Harper government has spent $2.3 million on photographic services.

Bayne argued that while it may have been "administratively irregular" for Duffy to treat some of these services as part of research and contracts, the work, as described by Bayne, would be considered senate related. And Makhlouf agreed.

Earlier, court heard that some contracts are approved after work has been completed and that in other cases, it's left to Senators to approximate the value of the work.

Sonia Makhlouf, a Senate human resources official, left, has been testifying this week in Ottawa about now-suspended Senator Mike Duffy's contracts with his friend, Gerald Donohue. (Greg Banning)

Bayne was reviewing with Makhlouf contracts totalling nearly $65,000 that had been made with the firm of the suspended senator's friend, Gerald Donohue.

One of the contracts for editorial and writing services, was for $10,000, and to be completed between Feb. 23 and March 31, 2009.

On Wednesday, Bayne pointed out that, according to documents, human resources received the contract at the end of March, around the time the work would have been completed and the contract was set to expire. He also noted that, according to administration policy, contracts are supposed to be approved before work begins.

Makhlouf explained that senators would sometimes submit requests after the start date of a contract. Human resources, she said, would advise senators that next time they would "appreciate you send your request earlier."

But she insisted that Senate administration had a "legal obligation" to pay the contract.

Bayne said the guidelines and policies may be one thing, "but the practices are another." "Yes." Makhlouf replied.

On another contract with Donohue's firm, Duffy had written that the total cost was to be determined because it was based on an hourly rate. But Duffy was informed by another human resources officer (not Makhlouf) that a contract needs an actual amount.

Bayne said that human resources officer was basically telling Duffy he could give an approximate amount, and if he went over that amount he could modify it and put in another amount.

"That again is evidence of the degree of discretion all these senators have," he said. "Just put an amount in there and you can change it up or down later."

"Yes," Makhlouf replied.

On Tuesday, Bayne peppered Makhlouf with questions about senators' office budgets, and got her to concede that senators have broad administrative discretion when it comes to deciding how to use their office budgets, including who they can hire and the duties of their researchers.

But he also zeroed in on the research contracts themselves, and the lack of oversight relating to, as he put it, "whether the work was done, what was done, who did [the work], whether there was value for money for the taxpayer."

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New majority owner of CWB includes Saudi investors

G3 Global Grain Group will invest $250 million to become the new majority owner of the CWB, formerly known as the Canadian Wheat Board.

The new Winnipeg-based partnership was selected to take over CWB's operations after a process set in motion when the Conservative government ended its marketing monopoly.

Farmers who sell their grain through the CWB can receive free units in an independently managed trust, which will hold the remaining 49.9 per cent interest in the CWB.

G3 is a partnership between:

• Majority partner Bunge Canada, a subsidiary of Bunge Limited, an agribusiness and food company operating in 40 countries worldwide.
• SALIC Canada Limited, a subsidiary of Riyadh-based Saudi Agricultural and Livestock Investment Company, Saudi Arabia's main agriculture investment vehicle.

"This is a win for Canadian farmers," Agriculture Minister Gerry Ritz told reporters at a news conference Wednesday, saying it was also a win for Winnipeg's economy that the new company's headquarters would remain in Manitoba.

"Nothing's been given away."

CWB head Ian White and the new CEO for G3, Karl Gerrand, joined Ritz for the announcement. Despite the global pedigree of the companies behind the deal, Gerrand emphasized his roots growing up on a grain farm in Virden, Man.

Need for strong competitor

The 2011 legislation that ended the Canadian Wheat Board's monopoly over marketing Prairie wheat and barley gave the revamped wheat board — purged of farmer-elected directors and now run by a board of federal government appointees — until 2016 to come up with a privatization plan and until 2017 to implement it. Otherwise, it would be dissolved.

CWB spoke openly of wanting to beat that deadline in order to end uncertainty about its future as quickly as possible. 

Dayna Spiring, the CWB's chief strategy officer, said the CWB didn't want an investor that already had a "Canadian footprint" (and, presumably, may have been tempted to simply roll the CWB's assets into an existing operation).

"One more person in there moving grain is certainly not a bad thing," Ritz said, contrasting it with the situation farmers faced earlier when they were denied the right to decide where to sell their crops.

But NDP MP Pat Martin called the deal "the death rattle of a great Canadian institution" and said there was never a good business case for abolishing the wheat board in the first place.

"They're not even 'selling' it ... they're just handing it over free of charge to an American agri-food giant and their Saudi partner on the promise that the new owners will invest $250 million in the future," the Winnipeg Centre MP said in a statement.

"How is it good business to legislate a Canadian success story out of business and hand over its assets to your former competitors?"

Canadian taxpayers provided approximately $350 million to help CWB with transition costs. Ritz said this public money was necessary because CWB's assets were heavily leveraged at the time the monopoly ended. Nothing in Wednesday's deal results in any return for the federal treasury.

Secrecy around process

G3 will assume control over CWB's operations in Winnipeg, potentially by this summer, although the deal has not yet closed.

The fate of CWB's downtown Winnipeg office space and current employees is not clear, although White said  Wednesday the building itself has been sold already. White will continue as CEO only through a transition period around the deal's closing.

Agriculture and Agri-Food Canada tendered a third-party study of the value of the CWB's assets but has refused to release that report. It has also refused to release any financial details of the CWB's operating results since the market opened up in 2012, citing sensitivities around competitiveness.

Due to confidentiality agreements, it's unclear exactly which multinational grain companies were in the running or how much they'd offered.

A Canadian farmer-investor bid for the CWB by the Farmers of North America group was based on a valuation of the CWB's assets at between $250 and $300 million. That bid was rejected last fall.

CWB now operates seven grain elevators in Western Canada and port terminals in Thunder Bay, Ont., and Trois Rivieres, Que. Four more grain facilities are under construction in Manitoba and Saskatchewan. 

Bunge Canada's terminal in Quebec City and its four elevators in Quebec are part of this deal. However, the new company does not have a port facility on Canada's West Coast, thought to be a weakness in terms of a global growth strategy for shipping more grain to Asia.

Gerrand said the company would be looking to solve this problem "in due course."

Foreign investment concerns?

Industry Canada has already given its blessing to the sale, Ritz said, although the Competition Bureau has yet to green light the new investor.

Gerrand pointed out that Saudi Arabia is already an important export market for Canadian grain, and SALIC targeted Canada for its surplus of high quality grain.

"We're not concerned about a foreign investor," the minister said, adding "every relevant farm group across Canada supports this move."

The minority stake offered to farmers is key to the deal's success. No grain company grows without shipping higher volumes of grain received from farmers, so it's now necessary to win their confidence.

Farmers used to elect directors to the former wheat board and share in its governance. Its assets were funded with their crop proceeds. A new seven-member CWB board going forward may include a representative from the farmers trust.

The minister and the CEOs struggled Wednesday to explain exactly how the farmer trust will work and whether the stake is permanent.

The trust will be capped at roughly $250 million, with shares already being allocated to farmers based on how much they sell or have sold to the new CWB since 2012. The farmers' stake in the trust was described as a "gift."

After seven years, however, G3 may have the option of buying out farmers. Some or all of the trust could also be sold to future shareholders — that's up to the three-person independent board set up to manage the trust.

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No prayers for mayors: What Saguenay ruling means for faith in the public sphere

Thou shalt not pray in council chambers.

At least not in the form of a public recitation to open meetings, the Supreme Court of Canada ruled Wednesday, ending an eight-year legal case involving the right of city councillors in Saguenay, Que., to cross themselves and recite a 20-second Catholic prayer before official municipal business.

The unanimous decision from Canada's top court had an immediate impact across the country.

City of Halifax legal staff began reviewing its morning "invocation," which begins with the words "God our creator" and ends with "amen."

A crucifix above the Speaker's chair in the Quebec National Assembly has been described by some politicians more as a symbol of Quebec's heritage, not an item representing Christian faith. The cross was installed in 1936 by the order of then-premier Maurice Duplessis. (CBC)

Ottawa's city council also dropped its morning prayer on Wednesday, as did the community of Dieppe, N.B.
Both municipalities stated they would review the practice — something constitutional law expert Errol Mendes suspects many town and city councils will be doing in the days to come.

Just as the Quebec Charter of Human Rights and Freedoms, which formed the basis for the Supreme Court ruling, has a duty to ensure that no particular belief should be favoured or hindered, the court ruled that "the same holds true for non-belief."

In effect, Mendes explained, the ruling means freedom of conscience and religion includes the freedom not to observe any faith.

In a manner of speaking, "it's freedom from religion," he said. 

Applies nationwide

That should not be taken to mean that Canada is against all religion, however. Or even necessarily its public manifestation. 

'The Supreme Court of Canada…represents the legal perspective across the country'- University of Windsor law professor Richard Moon

The ruling, for example, did not deal with religious icons in provincial legislatures or the prayers that open parliamentary sessions in Ottawa. And there are some legal observers who feel that some forms of public prayer and reflection would be fine as long as they are not overtly exclusive.

In essence, the ruling said "just that we welcome religions of all faiths and practices in Canada — in the private sphere," Mendes said.

Although Wednesday's decision was based on the Quebec charter, Mendes said it's implicit that the ruling applies nationwide.

University of Windsor law professor Richard Moon, whose work on freedom of religion was cited as part of the Supreme Court decision, said the same provisions under the Quebec charter would be reflected in the Canadian Charter of Rights and Freedoms anyway.

Mayor Jean Tremblay of Saguenay, shown crossing himself, has argued that reciting a 20-second prayer before city council meetings respects Quebec's Catholic heritage. The Supreme Court of Canada ruled on Wednesday that elected officials cannot open meetings with a prayer. (CBC)

"When the Supreme Court of Canada makes a determination, even when it relates only to a particular circumstance of the Quebec charter, the fact is it represents the legal perspective across the country," Moon said. 

The right-to-pray matter began in 2007, when Sagenuay resident Alain Simoneau, an atheist, first filed a complaint with the Quebec Human Rights Tribunal about elected officials praying in council chambers before meetings.

Mayor Jean Tremblay, a devout Catholic, was ordered to cease the practice. He instead appealed the decision to the Quebec Court of Appeal, which ruled in his favour in 2011.

Simoneau bumped the case up to the Supreme Court of Canada, which agreed last year to hear it.

Parliament possibly exempt

In its decision on Wednesday, the court ruled that the recitation of the prayer infringed on freedom of religion rights by "profess[ing] one religion to the exclusion of all others." 

A "neutral public space," the ruling said, must be "free from coercion…and is intended to protect every person's freedom and dignity."

Saguenay Mayor Jean Tremblay won his appeal to hold prayers before council meetings. (Jacques Boissinot/Canadian Press)

While the city of Saguenay argued that even the House of Commons holds a prayer before its sessions, the court reasoned that such proceedings are likely subject to parliamentary privilege.

Tremblay and the city of Saguenay have been ordered to pay Simoneau $33,200 in compensatory damages, punitive damages and costs.

What wasn't ruled upon in this case, however, was Simoneau's original demand for the removal of religious iconography such as a crucifix and a Sacred Heart statue from Saguenay's council chambers.

Diana Ginn, who teaches a course on law and religion at Dalhousie University's Schulich School of Law, noted that the symbols were not covered in the Supreme Court decision because the original tribunal judgment focused only on the prayer issue.

"Therefore, it had to be set aside for this case," she said. "But there's nothing to stop somebody from bringing a complaint against the Sacred Heart."

A crucifix still overlooks the speaker's throne in the Quebec National Assembly, though politicians including Quebec Premier Pauline Marois have argued it is a cultural symbol, not a religious article.

"This balance of how do you find the line between what's a reflection of the history of a place, and what's an expression of religion that's allowable in the face of state neutrality is going to lead to a lot of discussion," Ginn said.

Public prayer not fully banned

Wednesday's ruling doesn't mean praying is strictly banned in any kind of public-service context.

"There is no complete ban on prayer," said Gilles Levasseur, a law professor at the University of Ottawa.

"You can still have a statement that encompasses everybody, or invites reflection from people for their own beliefs,"

Levasseur said. "The key thing is the wording. It might not be a 'prayer,' maybe it's something generic. Maybe it's a 'recital' — some time to reflect on goodness of society and what we need to do to improve the wellbeing of our society," he said.

Mendes suggested another workaround.

"How about a moment of silence? Atheists can still reflect on what the meaning of life is. It could be an alternative," he said.

"A moment of silence can also just be a moment of reflection. I think even those who don't believe in any religion can probably get behind that."

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Election-year budget will still offer some giveaways despite 'fragile' economy: Chris Hall

Finance ministers nearly always save a surprise for budget day, what media folks unfailingly refer to as a "goodie," intended to give Canadians something to remember from a document that's otherwise dedicated to producing a whole lot of numbers.

Joe Oliver will be no exception on Tuesday when he tables his first budget, the Conservatives' last, before the scheduled fall election.

As usual it will be called Canada's Economic Action Plan. A better title might be Cheques and Balances.

The government has already announced its modified version of income-splitting for families with children 17 and under. And the first cheques will be mailed out this summer under a richer, expanded Universal Child Care Benefit.

Total cost to the treasury? About $4.5 billion a year.

Oliver has also promised, repeatedly, that this budget will be balanced.

Plus he is bringing in legislation to require future budgets to be balanced except in exceptional circumstances, such as the kind of global recession that prevented the Conservatives from balancing the books for the past seven years.

You would think that doesn't leave much room for more goodies.

But this is an election year, when moral and political imperatives collide.

Budget 2015 will be the foundation for whatever campaign platform Stephen Harper puts before voters to convince them that four more years of Conservative rule is in both their best interests.

Prime Minister Stephen Harper's targeted tax giveaways offer a new definition of retail politics. (REUTERS)

Government insiders suggest the budget could include money to address climate change issues, to encourage companies in the non-energy sector to hire new employees, or to address barriers to First Nations development.

"It doesn't have to be big numbers," says Jennifer Robson, a former Liberal political staffer who's now a professor of political management at Carleton University.

"But it has to be strategic and surgical because they don't have a lot of fiscal room to play with in an election year. And they have to get it right."

Tuesday's focus

The broad themes of Oliver's budget are already known: jobs and growth, keep taxes low, allow families to keep more of their hard-earned income.

But the focus on Tuesday will be sharper, making sure voters understand the Liberals and New Democrats can't be trusted to manage the economy through what the Conservatives call a fragile economic recovery.

That last bit presents a challenge, especially for a rookie finance minister who is introducing this budget weeks later than usual as his department tried to cope with the impact of plunging oil prices.

Government revenues, of course, are also down as a result of oil's drop. Growth projections had to be scaled back. On Wednesday, the Bank of Canada announced the first three months of the year had produced zero, that's right, zero economic growth.

And that wasn't the only bad news this week.

Canada's manufacturing sales slumped for a second straight month in February, down 1.7 per cent on a month-over-month basis and well below even the pessimistic projections of private sector forecasters who predicted a modest 0.3 per cent gain.

And the price of oil?

Well, it jumped on Wednesday to reach a high for the year of  about $55.50 a barrel for light, sweet crude.

That jump may underline Bank of Canada governor Stephen Poloz's assessment on Wednesday that the positives in the economy will outweigh the negatives in the second half of the year. But it is still roughly $25 a barrel less than the price  Oliver's officials had based their initial 2015 calculations on.  

That economic uncertainty has finance officials still working on the final draft of some of the government's budget this week.

What to expect

The Conservative message will be that Canadians know best how to spend their money, not government.

So look for more targeted personal and business tax breaks in the budget. Not large but focused on, for example, allowing Canadian companies to compete.

Those are expected to include another extension of the accelerated capital cost allowance, which allows companies to write off investments in new technologies more quickly. There might also be certain income tax cuts aimed at the middle class, to dull recent opposition attacks.

Thomas Mulcair will also be watching Tuesday's revenue numbers closely. (Reuters)

There could also be targeted spending initiatives. Expect money to be earmarked for Canada's national security agencies — CSIS and the RCMP — to allow them to fulfill the wider anti-terrorism mandate set out in Bill C-51.

Similarly, there is likely to be more money for the Security and Intelligence Review Committee, or SIRC, which has been chronically under-funded over the years.

What isn't known is how much money will be available, and whether the amounts will come close to what these agencies have been seeking in the aftermath of the October attack on Parliament Hill and the killing of two Canadians soldiers.

The government has been busy lining up some extra spending money, with the sale of Ottawa's remaining shares in GM Canada, expected to net roughly $3.2 billion, being a prime example.

And for the opposition parties this budget is also critical heading into an election. Carleton's Jennifer Robson says both the NDP and Liberals need to see the forecasts to ensure their own costing is right.

The NDP, for example, has promised to raise the federal minimum wage, and to bring in a national, $15-a-day child-care program.

The Liberals have promised to reverse the Conservative's income-splitting plan, and to bring in a national framework to reduce greenhouse gas emissions.

Both opposition parties insist they won't run a deficit.

In an election year, it's all about cheques and balances. 

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Investor ​G3 Global Grain Group taking over former Canadian Wheat Board

Breaking

$250M investment gives Winnipeg-based venture majority ownership in CWB commercialization process

By Janyce McGregor, CBC News Posted: Apr 15, 2015 9:34 AM ET Last Updated: Apr 15, 2015 9:34 AM ET

A newly established agribusiness partnership based in Winnipeg has been selected as the majority investor for the former Canadian Wheat Board. 

CWB's search process concluded early, with a $250-million investment from G3 Global Grain Group.

A press release from G3 says it has acquired a majority interest, of 50.1 per cent, in CWB, with the minority ownership interest to be held in trust for the benefit of farmers.

The transaction is expected to close in July 2015, it says.

G3 was formed through a partnership between:

• Bunge Canada, a subsidiary of Bunge Limited.
• SALIC Canada Limited, a wholly owned subsidiary of Saudi Agricultural and Livestock Investment Company.

More to come

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The House

• Week One of the Mike Duffy trial Apr. 11, 2015 2:01 PM This week on The House, with week one of the Mike Duffy trial now in the books, we break down the first week of proceedings and the political implications of the case with the CBC's Terry Milewski, Radio-Canada's Emmanuelle Latraverse, the former law clerk of the House of commons Rob Walsh and the Senate's longest-serving member Anne Cools.

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Duffy's lawyer to continue cross examination of Senate HR officer

The lawyer for Mike Duffy will continue to cross-examine a Senate human resources officer today, building on his case that the institution is administered by broad and vague rules and guidelines with no oversight of work contracts submitted by senators.

Sonia Makhlouf, whose job is to assess Senate research contracts and ensure the services being billed pertain to parliamentary business, will take the stand for her second day. Duffy's lawyer, Donald Bayne, is expected to finish his questioning of Makhlouf this morning at the Ottawa provincial courthouse, but the Crown could redirect.

Duffy has pleaded not guilty to 31 charges of fraud, breach of trust and bribery related to expenses he claimed as a senator and later repaid with money provided by the prime minister's former chief of staff.

On Tuesday, Bayne peppered Makhlouf with questions about senators' office budgets, and got her to concede that senators have broad administrative discretion when it comes to deciding how to use their office budgets, including who they can hire and the duties of their researchers.

But he also zeroed in on the research contracts themselves, and the lack of oversight relating to, as he put it, "whether the work was done, what was done, who did [the work], whether there was value for money for the taxpayer."

Makhlouf also noted that only basic information is provided in contracts, including a couple of lines describing the services to be provided, and the signature of the senator. She said human resource and finance officials are often left in the dark about the work done because it's all carried out at the discretion of the senator. 

On Monday, Makhlouf's testimony was used by the Crown to build its case alleging the suspended senator charged taxpayers for non-Senate business through contracts with his friend, Gerald Donohue. Those services included payments to a volunteer, a makeup artist and a personal trainer, and for an enlarged photo of family members and one of Barbara Bush.

Makhlouf had testified that Senate contracts would not be awarded based on those services because none of them would be considered parliamentary work. 

But Bayne challenged some of that testimony Tuesday, referring to the Senators' handbook on the use of Senate resources. He said those guidelines clearly state that items such as advertising, publicity, film development and photographic services can all be properly billed as expenses.

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Liberals lose lead to Tories for 1st time since Trudeau took over: Eric Grenier

For the first time since Justin Trudeau took over the party two years ago, the Liberals have lost the lead in national voting intentions.

While that has placed the Conservatives in top spot, it is the New Democrats who have benefited from the Liberals' slip.

ThreeHundredEight.com's latest poll averages put the Conservatives narrowly ahead with 32 per cent support. The Liberals trail with 31 per cent, while Thomas Mulcair's NDP is in third with 22 per cent.

The Greens stand at an average of 7 per cent support in the polls, with the Bloc Québécois at 5 per cent.

Federal polling averages, with polls in the field to Apr. 9, 2015. (ThreeHundredEight.com)

Stephen Harper's Conservatives have swapped positions with the Liberals almost by default, as the party has been consistently polling at between 32 and 33 per cent since early December and the Liberals have slipped.

Trudeau's party was polling at between 33 and 34 per cent for the first three months of the year, but has been dropping over the last three weeks.

This is taking place as the New Democrats put together their most positive string of polls in more than a year. That was the last time the NDP managed at least 23 to 25 per cent support in four consecutive polls, the same streak they are currently riding.

With these levels of support, the Conservatives would likely win between 120 and 161 seats. That puts them short of the 170 needed to form a majority government. The Liberals would take between 98 and 136 seats, while the New Democrats could win between 61 and 88 seats.

The Greens would likely take two seats, with one to nine seats going to the Bloc Québécois.

NDP gains come in Ontario, B.C.

Liberals votes appear to be trickling to the New Democrats in the areas the party can least afford. In Ontario, where the Conservatives are holding steady with 37 per cent, the Liberals have dropped four points in two months to 35 per cent. The NDP, meanwhile, has picked up three points, sitting at 19 per cent.

With those numbers, the Conservatives could take 49 to 65 seats, with the Liberals winning 40 to 57 and the NDP pocketing 14 to 17.

The NDP is also taking support away from the Liberals in another battleground province. The Liberals and Conservatives are tied with 29 per cent apiece in British Columbia, but that represents a drop of five points over the past two months for the Liberals. The NDP has increased its share by five points to 27 per cent.

The Greens, at 13 per cent, continue to post their best numbers in the country here.

And in Atlantic Canada, the only region in Canada where the Liberals hold a definitive lead, Trudeau's support is starting to falter. From 53 per cent at the beginning of the year, the Liberals have dropped to 46 per cent. Marginal gains have been made by the Tories, NDP and Greens in the region.

Voting intentions are holding steady in Saskatchewan and Manitoba, where the Conservatives lead with 42 per cent. The Liberals trail with 30 per cent and the NDP with 20 per cent.

Liberals, NDP stagnant in Quebec

The New Democrats have not replicated their gains in Quebec, however. The Liberals and NDP are tied at 27 per cent support in the province. By comparison, the Liberals were at 34 per cent and the NDP at 32 per cent in October.

Both the Conservatives, up six points since then to 20 per cent, and the Bloc Québécois, up four points to 19 per cent, have been the beneficiaries. But the Liberals and NDP are still on track to take the bulk of the province's seats: 29 to 45 for the NDP and 19 to 25 for the Liberals.

The Tories could triple their current representation in Quebec, with between 13 and 18 seats. The recent candidacies for the Conservatives of Gérard Deltell, former ADQ leader, and Alain Reyes, the popular mayor of Victoriaville, should help in that regard.

Provincial spill-over in Alberta?

The most unexpected development in federal polling has been the steep drop of support for the Conservatives in Alberta. As Jim Prentice's Progressive Conservatives find themselves in a three-way race, the federal Tories have dropped nine points in the last two months in Stephen Harper's own backyard.

The Conservatives still dominate the province with 46 per cent, but if that number holds on election day it would be the party's worst performance in Alberta since 1963.

The Liberals, at 25 per cent, are holding steady. But the federal NDP has replicated some of the provincial NDP's gains in Alberta, increasing its support by seven points in the last two months. They now stand at 19 per cent, and could conceivably be in the running for two to three seats. The Liberals could win four to seven, with the Tories taking the remaining 23 to 28.

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ThreeHundredEight.com's vote and seat projection model aggregates all publicly released polls, weighing them by sample size, date, and the polling firm's accuracy record. Upper and lower ranges are based on how polls have performed in other recent elections. The seat projection model makes individual projections for all ridings in the country, based on regional shifts in support since the 2011 election and taking into account other factors such as incumbency. The projections are subject to the margins of error of the opinion polls included in the model, as well as the unpredictable nature of politics at the riding level. The polls included in the model vary in size, date, and method, and have not been individually verified by the CBC. You can read the full methodology here.

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Indian PM begins official visit in Ottawa with Harper meeting

Indian Prime Minister Narendra Modi is meeting with Gov. Gen. David Johnston in Ottawa this morning as he kicks off the first full day of his three-day Canadian visit.

A number of key Conservative MPs, including Defence Minister Jason Kenney, were on hand to greet Modi when his plane arrived Tuesday in Ottawa.

After meeting with Johnston at Rideau Hall, Modi will then hold talks with Prime Minister Stephen Harper before both leaders head to Toronto to attend an Indian diaspora.

CBC News will livestream Modi's arrival on Parliament Hill at around 9:40 a.m. ET, followed by his joint statement after his meeting with Harper at 11 a.m. ET.

Trade, energy, the environment, security, and culture are expected to be among the issues Harper and Modi will discuss during the visit.

Indian Prime Minister Narendra Modi waves as he arrived in Ottawa Tuesday evening. His packed schedule Wednesday will see him on Parliament Hill for talks with Prime Minister Stephen Harper before heading to events in Toronto later in the day with Indo-Canadian groups. (Adrian Wyld/Canadian Press)

Harper will also accompany the charismatic Modi to Vancouver and will have no less than 16 fellow Conservatives appearing with them at various events.

Modi's visit is the first to Canada by an Indian prime minister since Indira Gandhi was hosted in 1973 by then-prime minister Pierre Trudeau.

Finalizing a deal two years in the making that would see Saskatchewan's Cameco Corp export peaceful nuclear material to India will also be a major priority.

And Louise Comeau, executive director of Climate Action Network Canada, would like to see Modi and Harper prod each other to make strong commitments to reduce greenhouse gases ahead of the UN climate conference in Paris in December.

"Neither country is performing to its best potential," she said. "We have a very large population in Canada with connections in India — we have opportunities for trading in clean energy."

The visit will also give Canadians their first glimpse of Modi, who swept to power last May.

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Supreme Court rules against prayer at city council meetings

Breaking

Mayor Jean Tremblay of Saguenay, Que., argued reciting prayer respects Quebec's Catholic heritage

CBC News Posted: Apr 15, 2015 9:56 AM ET Last Updated: Apr 15, 2015 9:56 AM ET

The Supreme Court of Canada ruled this morning that elected officials do not have the right to recite prayers at municipal council meetings.

More to come

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Note: The CBC does not necessarily endorse any of the views posted. By submitting your comments, you acknowledge that CBC has the right to reproduce, broadcast and publicize those comments or any part thereof in any manner whatsoever. Please note that comments are moderated and published according to our submission guidelines.

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Supreme Court quashes mandatory sentences for gun crimes, upholding Ontario

The Supreme Court of Canada has upheld a lower court's ruling striking down the federal government's law mandating minimum sentences of three and five years for gun crimes.

The court ruled 6-3 to endorse a 2013 ruling by the Ontario Court of Appeal that labelled the law cruel and unusual, saying it violated Section 12 of the Charter of Rights and Freedoms. The provincial and federal attorneys general had appealed that finding.

The top court upheld the appeal court's quashing of both the three-year mandatory minimum for a first offence of possessing a loaded prohibited gun, as well as the five-year minimum for a second offence.

The Ontario and federal governments argued that the minimums do not breach the charter protection against cruel and unusual punishment.

The new sentencing rules were enacted in 2008 as part of a sweeping omnibus bill introduced by the federal Conservatives.

The two governments say they enacted the mandatory minimums in response to the increasing number of handgun possession cases coming before the courts.

In one of the two cases that made up the Supreme Court appeal, a young Toronto man with no criminal record was sentenced to three years after pleading guilty to possession of a loaded firearm.

The judge in the case said that without the mandatory minimum, he would have sentenced Hussein Nur to 2½ years.

In the second case, Sidney Charles pleaded guilty to firearms offences after he was found in his rooming house bedroom with a loaded and unlicensed semi-automatic handgun.

He was sentenced to five years because he had two previous convictions.

In defending the mandatory sentence for repeat offenders, Ottawa and Ontario argued that it is within a reasonable range of legislative choice.

The Supreme Court has clashed with the Conservative government on several key policies, although it recently sided with Ottawa over the destruction of gun registry data, which Quebec sought to preserve.

That win for the Conservatives came after several losses at Canada's top ourt.

The justices rejected Prime Minister Stephen Harper's appointment of Quebec Judge Marc Nadon to their ranks, stymied an effort to stop judges from giving extra credit for time spent in custody before sentencing and ruled that Parliament could not reform the Senate on its own.

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Mike Duffy trial: Defence cross-examining Senate official on expenses

Mike Duffy's lawyer, Donald Bayne, is cross-examining a Senate human resources official, whose testimony on Monday was used by the Crown to build its case that the suspended senator charged taxpayers for non-Senate business.

Sonia Makhlouf, whose job it is to assess Senate contracts and ensure the services being billed pertain to parliamentary business, was questioned by Crown prosecutor Jason Neubauer on Monday, the beginning of the second week of the trial at the provincial courthouse in Ottawa.

Duffy has pleaded not guilty to 31 charges of fraud, bribery and breach of trust related to expenses he claimed as a senator.

On Monday, Neubauer reviewed with Makhlouf Duffy's controversial $65,000 worth of contracts with his friend Gerald Donohue.

According to the terms of the Senate contracts, Donohue was being employed to provide consulting and editorial services. However, RCMP have said that Donohue did "little or no apparent work" for the $65,000. The Crown is attempting to show that payments earmarked for those contracts were instead used by Duffy to expense non-Senate business.

Neubauer asked Makhlouf about a number of services — payments for a makeup artist, a personal trainer, an enlarged picture of family members and Barbara Bush — and whether Senate contracts would be awarded based on those services.

No, she said, because none of those services would be considered parliamentary work. 

The Crown entered into evidence invoices from Jiffy Photo and Print addressed to Mike Duffy, "c/o Gerald Donohue Maple Ridge Media," which showed costs for picture enhancements, including those for photos of Bush and Duffy's daughter and grandson, as well as other personal pictures. Meanwhile, cheques entered into evidence appear to show Donohue's companies paying for these expenses.

The Crown has contended that the contracts with Donohue were effectively a clearinghouse for Duffy to hand out money "as he saw fit," and a "reserve pool over which there was no possibility of financial oversight."

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Was Tom Mulcair right about 'Dutch disease' economics?

The latest national job numbers came as a great surprise.

Great because they were up — a surprise because analysts were predicting the numbers would be down.

The top-line numbers, however, mask the hollowing out of a portion of the Canadian economy.

According to the Labour Force Survey, 1,688,300 Canadians were employed in the manufacturing sector in March, a drop of 1.8 per cent from the previous month.

That means there are currently fewer people working in that sector of the economy than at any time in the nearly 40-year history of the modern Labour Force Survey.

In January 1976, the first month of the new survey, Statistics Canada reported more than 1.8 million people were working in manufacturing.

To put those numbers in greater context — the entire labour force for all industries at the time numbered 9.6 million.

Today it stands at 17.9 million; an 86 per cent increase.

Manufacturing keeps shrinking

Manufacturing has shrunk over the same time period by more than a quarter.

A screen capture shows an ad produced by the Conservative Party against NDP Leader Tom Mulcair. (YouTube)

Last fall, Bank of Canada governor Stephen Poloz said parts of the sector have lost 75 per cent of their output since 2000.

He pointed out this is more than just cancelling the third shift at a plant — that kind of decline represents factory closures and companies restructuring to slim down.

The closures and restructuring were made necessary because of declining demand from international clients, whose currency isn't going as far as it used to compared with the Canadian dollar.

The loonie was being driven largely by the power of strong oil prices.

"It's by definition, Dutch disease." opined Tom Mulcair in an interview with the CBC in May 2012.

Wilting tulips

The term was coined in 1977 to describe the downside of the discovery of natural gas fields off the coast of the Netherlands.

The ensuing economic boom boosted the country's currency, which was harmful to its other exports and — in the end — the overall economy after commodity prices slumped.

Sound familiar?

"The currency's appreciation of almost 60 per cent over the last 15 years has really hurt the manufacturing sector," is the assessment of Canada's economy by Bank of America Merrill Lynch economist Emanuella Enenajor.

Poloz hasn't used the term (certainly not publicly), but did concede, "capacity in these subsectors has simply disappeared."

It might not come back

Just because low oil prices are reducing transportation and energy costs, and the floundering loonie is making Canadian exports attractive again — it doesn't mean the sector will bounce back immediately.

You can't just turn the lights back on in the factory and start sending the widgets out the door again.

When the energy sector started to lose steam, the old stalwarts of the economy weren't there to pick up the slack.

"The Dutch disease that Canada has experienced has been more than a decade in the making, and I think it has really hurt business confidence," added Enenajor.

Supporting that view is the Bank of Canada's latest survey of companies, which suggests that cheaper oil is reducing their expectations for the economy in the near term.

But that's just economics

It takes economists reams of research and data to offer evidence Canada suffered from, and continues to have the after effects of, Dutch disease.

Mulcair's 2012 diagnosis has merit, but the Conservatives use far fewer words to show that counts for very little in an election year.

"The leader of the NDP calls [the natural resources] sector a disease!" Pierre Poilievre sneered at Mulcair across the floor of the House of Commons last week.

A rebuke even economists have to admit will likely put what they call "downside pressure" on the NDP's vote in at least some parts of the country.

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Canada prepares to join in training Ukraine military

Prime Minister Stephen Harper has announced Canada will join a training mission to help Ukraine's beleaguered military.

After months of requests for help from the Ukrainian government, Tuesday morning's announcement represents the first time the Canadian Forces have joined Ukrainian forces in their struggle against Russian-backed rebels.

Harper made the announcement at a staged photo call and took no questions. 

A press release said 200 troops will be deployed "on both a sustained and periodic basis" until March 31, 2017, to "develop and deliver military training and capacity-building programs for Ukrainian forces personnel." It may start within weeks.

Defence Minister Jason Kenney and Chief of Defence Staff Tom Lawson are answering questions about the long-anticipated move at the defence department's headquarters.

Canada's British and American allies are already in Ukraine conducting training missions of their own.

Canadian forces are expected to help with explosive ordnance disposal and improvised explosive device disposal training, military police training, medical training, flight safety training, and logistics system modernization training.

Some of the IED skills Canada will pass on were painfully learned during the five-year combat mission in Kandahar, Afghanistan.

The release also says Canada will provide individual and unit tactics training to Ukrainian National Guard personnel as part of a mission led by Americans.

Newly mobilized Ukrainian paratroopers carry an anti-tank grenade launcher during a military drill near Zhytomyr on April 9. Canadian troops could soon be joining U.S. and British forces training the Ukrainian military. (Valentyn Ogirenko/Reuters)

The U.S. military has deployed 800 troops to train three — possibly four — battalions in western Ukraine and the British recently sent 75 soldiers to give instruction in command procedures, tactical intelligence and battlefield first aid.

Defence sources say that this deployment will see Canadian soldiers working and housed far away from the battle taking place on the eastern side of the country. It's expected Canadian soldiers will be stationed in an existing NATO training centre located in Yavoriv, near the Polish border in Western Ukraine.

Canada's mission is another attempt to push back against the Russian regime of President Vladimir Putin. 

Both Washington and Ottawa have been under pressure to ship lethal military aid to President Petro Poroshenko's government, which has been struggling to hold a shaky ceasefire together with rebels.

The Pentagon delayed the training program for Ukrainian soldiers last month to avoid giving the Kremlin an excuse to scrap the peace deal struck in February.

There have been widespread reports in the last week that Russian-backed separatists are preparing for a spring offensive in the southern region, a sign the conflict could re-ignite.

Russia could very well consider the deployment of NATO trainers as a provocation at a time when it has rattled most of Europe with massive, snap military exercises along its borders involving tens of thousands of troops.

It strikes at the heart of the dilemma faced by Western leaders: how to stop Russian President Vladimir Putin's slow-motion dismemberment of Ukraine without provoking a major war.

The announcement of Canada's participation comes just days after Estonian President Toomas Hendrik Ilves told a British newspaper that he was in favour of NATO deterring Russia with the permanent stationing of combat units in the Baltic states.

Four Canadian CF-18s took part in NATO air policing missions to protect the Baltic States last year, and a company of soldiers belonging to the Royal Canadian Regiment are currently involved in exercises in the region.

In February, Defence Minister Jason Kenney said Canada was "actively considering different options for engaging" in the emerging training mission, but he also said Canada would and could not act alone in supplying lethal weapons to bolster Ukrainian President Petro Poroshenko's government.

The Canadian Press reported in December that a small team of fewer than 10 soldiers travelled to Ukraine to look for training opportunities with Ukrainian forces in the areas of military police, medical personnel and "personal protective measures." Officials did not characterize the very small number of troops as a pre-deployment team.

"There are a number that have come and gone in support of various missions and the military police, they're coming, they will be here for a deployment and then they will leave. This is a continuing effort," then-defence minister Rob Nicholson told reporters.

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Are the Alberta PCs really in trouble?

Never in the field of Canadian elections have polls meant so little to so many.

A governing party trailing in second place, maybe even third, and with its leader posting dismal approval ratings, would normally set off alarm bells.

But this is Alberta, and old habits die hard.

After 44 years in power and 12 consecutive election victories, anything but a win by Jim Prentice's Progressive Conservatives is dismissed by many as nearly fantastical.

Even the pollsters are couching their analyses with warnings of the changes likely to come. The Tories may be in dire straits now, but the election is many weeks away. The inevitable will still, probably, come to pass — right?

But re-alignments can happen swiftly. Are the polls presaging a historic defeat for the Alberta PCs, or is there good reason to believe that what the numbers show now will not be the same on May 5, when Albertans cast their ballots?

The case for the polls

ThreeHundredEight.com's latest aggregation of the polls released Monday show the Wildrose Party holds the lead with about 30 per cent support, followed closely by the Progressive Conservatives at 28 per cent and the New Democrats at 26 per cent. The Alberta Liberals bring up the rear with 12 per cent support.

This outcome would likely deliver a minority government headed by either Wildrose or the Tories, with the edge narrowly going to Wildrose. It is too close to say anything more definitive.

If these results were repeated on election day, it would be the best showing for the NDP since 1989 and the worst for the PCs since 1967.

This alone should raise some red flags. But the polls reported in the media have been remarkably consistent. In the three polls conducted by different polling firms since the beginning of April, Wildrose has registered between 30 and 31 per cent, the PCs between 25 and 27 per cent, and the NDP between 26 and 28 per cent. What first looked like a fluke at the end of March has been confirmed again and again.

Other indicators back up these numbers.

Alberta Wildrose Leader Brian Jean, centre, is not well known in the province, but begins his first campaign as leader with good numbers. (Larry MacDougal/Canadian Press)

Prentice's approval ratings have dropped precipitously. From more than 50 per cent in polls conducted in December, Prentice has registered an approval rating of between 22 and 29 per cent in two recent polls, with his disapproval rating topping out at 60 per cent or higher.

In 2012, when the PCs were running behind Wildrose, the polls never showed such low numbers for then-premier Alison Redford. Only in the weeks shortly before her resignation did her numbers turn so sour.

The budget seems to have been a catalyst for this decline. Polling by Insights West suggested that 78 per cent of Albertans thought the budget would have a negative effect on their households, and a majority did not think that the fall in oil prices justified it.

Fears of change amid an unstable economical climate also appear low. ThinkHQ found that just 30 per cent of Albertans agreed that a change of government would make things worse on that front.

There are also signs that the NDP's stellar climb into contention is no anomaly. NDP Leader Rachel Notley boasts, by a wide margin, the best approval ratings in Alberta. The most recent poll by Forum Research pegged her approval rating at 42 per cent, with just 21 per cent disapproving of her.

The case for another PC victory

The experience of the 2012 election, however, looms large over this campaign. Every poll published during the write period suggested that Wildrose would win. Instead, the Tories were re-elected with a large majority of seats. A warranted skepticism has defined Albertans' views of the polls since.

But leaving aside the possibility that the polls are just wrong (and the record of the polls in 2012 is far more nuanced than that), there are good reasons to believe the results on election night will differ markedly from where the numbers are now.

The most important one may be the incumbency factor, which plays into the hands of every governing party. Unexpected victories by the incumbent have happened recently in provincial elections from British Columbia to Quebec. And in 2012, the Alberta PCs were trailing from the first week of the campaign.

The incumbency factor could play an even larger role in this campaign because of the relative obscurity of Brian Jean, Wildrose's recently named leader. The latest Forum poll showed that 47 per cent of Albertans had no opinion of him, leaving a lot of minds left to be made up. And considering that 44 per cent of respondents told ThinkHQ they found Wildrose "too extreme," those minds could be made up to Jean's detriment.

Notley, too, is still unknown to more than a third of Albertans.

And then there are the Liberals, who are on track to have candidates on the ballot in only half of the province's ridings. If that happens, they will certainly not get the 12 per cent the polls are currently giving them. Where will those orphaned voters go? To the PCs to block Wildrose, the reason for the Liberals' collapse in 2012, or to the NDP, the other left-of-centre option?

Added to all of this is the reality that a majority of Albertans say they have yet to be convinced to vote for any party. In ThinkHQ's most recent poll, fully 58 per cent of respondents said they could change their mind. 

That makes for a lot of voters up for grabs, and the likelihood that the result on election night will resemble the polls today slim. But that doesn't necessarily mean Jim Prentice's PCs will end up on top.

---

The poll by Forum Research was conducted between April 7 and 9, 2015, interviewing 1,661 Albertans via interactive voice response. The margin of error associated with the poll is +/- 2 per cent, 19 times out of 20.

The poll by ThinkHQ was conducted between April 2 and 6, 2015, interviewing 1,835 Albertans via the Internet. As the poll was conducted online, a margin of error does not apply.

The poll by Insights West was conducted between March 27 and 30, 2015, interviewing 602 Albertans via the Internet. As the poll was conducted online, a margin of error does not apply.

ThreeHundredEight.com's vote projection model aggregates all publicly released polls, weighing them by sample size, date and the polling firm's accuracy record. The projections are subject to the margins of error of the opinion polls included in the model, as well as the unpredictable nature of politics at the riding level. The polls included in the model vary in size, date and method, and have not been individually verified by the CBC. You can read the full methodology here.

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Ontario to sign cap-and-trade agreement with Quebec to reduce emissions

Ontario Premier Kathleen Wynne will sign an agreement today to join Quebec in a cap-and-trade system to reduce greenhouse gas emissions.

​She said the deal will create a "market mechanism" to encourage companies to move toward reducing emissions that lead to climate change. 

A cap-and-trade system allows companies to either cap their greenhouse gas emissions or buy credits from companies that have reduced emissions.

Wynne outlined the basics of the deal at an announcement in Toronto Monday morning.

Highlights include:

• A hard ceiling on the pollution allowed in each sector of the economy. 
• Proceeds from the carbon market will be reinvested in projects that reduce emissions.
• A process to reward companies that work to reduce greenhouse gas emissions.
• A long-term plan to join the largest cap-and-trade market: the Western Climate Initiative, which includes Quebec and California.

​"Right now, we allow polluters to put carbon into our environment for free," said Wynne.

Under the deal with Quebec, she said, "proceeds from carbon market will go back into the economy to drive growth."

Wynne says climate change is already imposing costs on society, damaging crops and increasing insurance claims, and warns the costs of not taking action will only get higher.  

 And she says cap-and-trade is a market solution, not a regulatory one, and will provide certainty for industry.

She admitted there will be added costs for consumers and industry.

For example, the government cited reports that estimate cap-and-trade will add two to 3.5 cents a litre for gasoline.

Wynne was scheduled to fly to Quebec City to sign a memorandum of agreement with Quebec Premier Philippe Couillard around noon Monday.

Environment Minister Glen Murray says the government will consult the public as it develops the details for the cap-and-trade scheme by October.

The announcement comes after Ontario has held public consultations on how to reduce its carbon emissions. Sources say Monday's announcement is timed to set the stage for the provincial and territorial leaders summit on climate change being held the next day in Quebec City.

Quebec implemented its cap-and-trade system in January 2015. As of February, the province has auctioned off $190 million worth of credits to reduce emissions.

Quebec operates its cap-and-trade system with California. Monday's announcement means that Ontario, Quebec and California could set up a joint system to allow companies to trade their emissions between all three jurisdictions, if Ontario signs a separate agreement with California. 

Tom Rand, a climate change expert and senior advisor on clean energy technology, spoke to CBC's Metro Morning Monday before Wynne's announcement.

He said the agreement is a "big deal" and "an attempt to go around recalcitrant national capitals in both Canada and the U.S."

He criticized the Canadian federal government, which he said has been "ragging the puck" on climate change for 10 years.

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Revenue Canada targets Steelworkers charity for political activities

A union-backed charity that wants Canadian mining companies held accountable for overseas misdeeds is among the latest to be targeted by the Canada Revenue Agency for political activities.

The Steelworkers Humanity Fund Inc. is still awaiting a verdict from the agency, nine months after an auditor showed up at the Toronto office and hauled away several binders of sensitive material.

The fund, with about $1.3 million in annual revenues, has supported Canadian food banks and provided disaster relief abroad since its founding in 1985.

But the charity's support of the Canadian Network on Corporate Accountability or CNCA, to which it gave about $37,000 in 2013, appears to have piqued the agency's interest.

"We've been part of this CNCA, and no doubt that's part of the rationale" for the audit, Steelworkers president Ken Neumann said in an interview from Toronto.

"It's quite clear that it's targeted to folks that speak up sometimes against the government's policies."

The Canada Revenue Agency launched a series of 60 political-activity audits in 2012, after the Harper government publicly tagged some environmental charities as radicals and money-launderers and possibly linked to terrorists. The federal budget that year earmarked $8 million for the special audits, later increased to more than $13 million through to 2017.

Audit net widens

The first wave of such audits hit environmental charities, but the net has since been widened to capture human-rights organizations, anti-poverty groups, international-aid and religious groups. Other labour-supported charities have been targeted previously, including CoDev and the Canadian Centre for Policy Alternatives.

Many charities undergoing political-activity audits have been outspoken against Harper government policies, and the audits have tied them in knots, draining resources. At least one group has lost its coveted charitable status, while others report self-censoring their public statements for fear of aggravating the auditors.

'They would see us as a thorn in their side.'— Steelworkers president Ken Neumann

The Canada Revenue Agency, however, says its choice of which charities to audit is made at arm's length from government, with no input from any cabinet minister, including Revenue Minister Kerry-Lynne Findlay. The agency declined comment on the Steelworkers audit.

The United Steelworkers' Canadian arm has frequently butted heads with the Conservative government over issues such as perceived lack of support for the manufacturing sector and what it sees as anti-labour policies.

The Steelworkers' charity draws largely on a one-cent-an-hour donation from union members, worth between $20 and $40 annually from workers, who can also opt out.

The fund gives about two per cent of its annual revenues to the non-charitable Canadian Network on Corporate Accountability, an umbrella group that includes faith groups, environmental NGOs and others, and is avowedly political, working to hold mining companies accountable in Canada for overseas misbehaviour.

Revenue Minister Kerry-Lynne Findlay has repeatedly rejected any suggestion that she directs which charities the Canada Revenue Agency will audit for their political activities. (Adrian Wyld/Canadian Press)

Under the tax agency rules, charities can devote up to 10 per cent of their resources to political activities, and the Steelworkers' charity fund reports no political activities other than its small role in the CNCA, worth two per cent of all expenses.

The audit is looking specifically at the fund's formal agreements with the Canadian Network on Corporate Accountability, as well as any "non-partisan actions concerning the retention, opposition or change to any law, policy or decisions of any level of government in any country."

Clashes with government

The network clashed with the Harper government as recently as last month, when it said a newly appointed ombudsman for corporate social responsibility was toothless, and that Canada needs tougher laws to deal with rogue mining companies.

"They would see us as a thorn in their side," said Neumann. Prime Minister Stephen Harper has "got his scope clearly on us. … These [audits] aren't random."

Last month, the charity Dying With Dignity had its charitable status annulled after a Canada Revenue Agency audit. And the charity Environmental Defence says it is appealing an adverse ruling from the agency after an audit.

The agency says that, as of March 31, it has completed 21 political-activity audits, with 28 still underway. Another 11 audits are to be started before the project ends in 2017. Officials will not identify any of the target charities because of the confidentiality provisions of the Income Tax Act.

So far, five charities have received notices of the agency's intention to revoke their charitable registration, while six have received education letters, and eight have been asked to sign compliance agreements for more grievous problems. There has also been one voluntary revocation, and one annulment, Dying With Dignity.

Follow @DeanBeeby on Twitter

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Feds say provinces won't hit their greenhouse gas targets

The federal environment minister has sent a letter to the provinces outlining how most of them are falling short of their targets to cut greenhouse gas emissions by 2020.

Leona Aglukkaq sent the letter Friday, a few days in advance of a provincial/territorial meeting on climate change in Quebec City.

The federal data shows that most provinces will not meet their 2020 targets to cut greenhouse gas emissions.

British Columbia and Alberta are the furthest behind. Ontario and Saskatchewan follow, with Quebec rounding out the top five.

When the provincial gaps are tallied up, they amount to 109 megatonnes, which is just 7 megatonnes short of the amount by which Canada will not meet its commitment for 2020.

New federal commitment

Aglukkaq also asked the provinces for more detail on what they plan to do after 2020.

Canada is putting together its new federal commitment in preparation of a world summit in Paris this December.

Many other countries have already published their post-2020 promises, including the U.S. and Russia. Aglukkaq says she needs more detail from the provinces and territories about their plans.

"There continues to be ongoing engagement between our officials to collect these inputs," she writes, adding, "That said, we have not yet received information for the post-2020 period at a level of detail that would satisfy the expectation of the Lima Call for Climate Action."

This weekend while on a trip to Panama, Prime Minister Stephen Harper promised to have Canada's commitment ready by the upcoming G7 summit in June.

"We wanted to wait for awhile to, at least, give the provinces the chance to have the conference they're going to have and address some of their own target issues and we want to see the outcomes of that," he told reporters. 

Dale Marshall, a program manager with Environmental Defence, said that the bulk of Canada's efforts to cut greenhouse gas emissions have been done at the provincial level. Aglukkaq's letter is an attempt to draw attention away the federal government's failures, he said. 

"For those provinces to now be turned to by the federal government and asked, 'What are you going to do for us now?' seems irresponsible. For the letter to come this late ... seems very much like a deflection away from the federal government and it's repsonsibilities."

Cap-and-trade agreement

The letter also comes on the eve of an expected announcement from Ontario Premier Kathleen Wynne. CBC News has learned she will sign an agreement on Monday to join Quebec in a cap-and-trade system to reduce greenhouse gas emissions.

In a statement sent to CBC News Sunday evening, Ontario's Environment Minister Glen Murray said "Canada needs a federal government that is willing to work with provinces."

The cap-and-trade system Wynne is expected to implement allows companies to either limit their emissions or buy credits from companies that have.

Quebec implemented its cap-and-trade system in January.  To date $190 million worth of credits to reduce emissions have been purchased by companies.

Quebec's operates its system with California. Monday's announcement means that Ontario, Quebec and California could set up a joint system to allow companies to trade their emissions between all three jurisdictions.

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Mike Duffy trial, Day 5

Live Blog

By Kady O'Malley, CBC News Posted: Apr 13, 2015 5:00 AM ET Last Updated: Apr 13, 2015 5:00 AM ET

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The House

• Week One of the Mike Duffy trial Apr. 11, 2015 2:01 PM This week on The House, with week one of the Mike Duffy trial now in the books, we break down the first week of proceedings and the political implications of the case with the CBC's Terry Milewski, Radio-Canada's Emmanuelle Latraverse, the former law clerk of the House of commons Rob Walsh and the Senate's longest-serving member Anne Cools.

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Mike Duffy trial: Senate expense rules, contracts to be focus in Week 2

The trial of Mike Duffy enters it second week in Ottawa today, with a Senate human resources official expected to testify on the rules of expense, and possibly shed some light on a $65,000 contract with the suspended senator's friend.

Sonia Makhlouf could provide some details on Duffy's contract with Gerald Donohue, who was hired by Duffy as an independent contractor.

Duffy has pleaded not guilty to all 31 charges of fraud, bribery and breach of trust related to expenses he claimed as a senator.

In court documents, the RCMP has alleged that Duffy paid Donohue $65,000 for "little or no apparent work." Donohue is also expected to be a witness at the provincial court trial.

Entries in Duffy's diary, which has been entered into the court as an exhibit, reveals a reference to Makhlouf regarding the contract. 

On Dec. 21, 2010, Duffy writes he "faxes Gerry's contracts to Sonia." In a later entry, dated Dec. 30, Duffy writes: "hassle with Senate Finance re: Gerry Donohue's contract."

Duffy's lawyer, Donald Bayne, will likely continue his game plan to suggest Senate expenses rules lack clarity.

Last week, Bayne conducted an extensive cross-examination of Crown witness Mark Audcent, a former Senate law clerk, for nearly three days.

Bayne zeroed in on rules governing residency, travel and office expenses filed by members of the upper chamber, and repeatedly asked Audcent if these regulations were "broad."

Audcent admitted the rules carved out around residency, for example, do not include a clear definition of what constitutes a primary residence.

Residency is one of the core issues in the trial. Duffy designated his home in P.E.I as his primary residence and he maintains this made him eligible to claim meals and living expenses for his time spent in the capital.

The Crown argues P.E.I. is not Duffy's primary residence.

Author and journalist Dan Leger, who penned Duffy: Stardom to Senate to Scandal, says Audcent's testimony did not damage Duffy.

Suspended Senator Mike Duffy's trial started last week in Ottawa and is expected to run into June. (Greg Banning)

"The fact that Duffy emerged from that without any deep slashing wounds is probably a good sign for his defence," Leger told CBC News Network.

"The other major element in all of this is the tremendous document dump that has been done with the Duffy diaries, the expense logs and just mountains of documents people are going through in search of the real story."

The Duffy diaries, which were entered into evidence last week, give a rare window into the personal and political life of the embattled senator, including entries about movies and dinner companions.

The entries also shed light on the volume of Conservative functions attended by Duffy.

"Here was a senator who was essentially hired, if you will, by the Conservative government, by Prime Minister Stephen Harper, to operate as a Conservative party fundraiser and sort of public relations man," Leger said. "This is what Mike Duffy did for a living."

Bayne emphasized Duffy's relationship with the government and the prime minister when he introduced a photo into evidence last week.

The photo signed by Prime Minister Stephen Harper and dated June 11, 2009, carries the message: 'To Duff. A great journalist and a great senator. Thanks for being one of my best, hardest working appointments ever.' (CBC)

The picture, dated June 11, 2009, included a message from Stephen Harper, "To Duff. A great journalist and a great senator. Thanks for being one of my best, hardest working appointments ever."

Duffy's trial, which will be conducted in two phases, is set to run until at least June 19.

A forensic audit, ordered by the Senate, is also underway and an interim report is expected to be released this spring.

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Mike Duffy's diary: Tory senators told 'don't rock the boat'

It must have seemed like the clap of doom. Amid rising public anger about the Senate and an embarrassing fraud scandal, the Harper government moved in 2011 to reform it.

Elections! Term limits! In June of that year, then-minister for democratic reform Tim Uppal announced a reform package that would drastically undermine the job security of honourable senators.

It's not hard to find the reasons why the government felt compelled to move.

In March of 2011, then-Liberal Senator Raymond Lavigne was convicted in a fraudulent scheme to obtain at least $10,000 in improper travel claims and hundreds of hours of free labour to clean up one of his properties. 

The public wanted action to clean up the Senate.

Democratic Reform Minister Tim Uppal was the spokesman for Stephen Harper's ultimately doomed Senate reform legislation, which would have brought about nine-year term limits and provincial elections to pick future appointees. (Adrian Wyld/Canadian Press)

In the end, Uppal's proposal came to nothing — but it evidently sent a wave of dismay through the Red Chamber.

For one thing, senators appointed after 2008 would have been limited to one nine-year term. For another, the prime minister would have to consider nominees selected by elections at the provincial or territorial level.

Elections? But that meant an aspiring senator might lose! Whatever happened to the cushy, lifelong gig that had always made a Senate appointment so desirable?

The calendar of one new senator — Mike Duffy — reveals the unease among his colleagues about this reckless talk of reform. (The diary became evidence at his fraud and breach of trust trial earlier this week.)

In fact, the anger had been brewing for a year.

'Angry debate'

An entry in Duffy's diary for May 30, 2010, reflects the gathering storm:

"Informal Senate caucus — angry debate over Senate reform."

Conservative Senator David Tkachuk, the chair of the secretive Senate committee that governs its operations, cautioned his caucus colleagues in advance of the auditor general's audit on Senate expenses. (Fred Chartrand/Canadian Press)

Honourable senators were not taking it well.

Then, it got worse. At the time of Uppal's reform plan, the auditor general was threatening to audit the Senate.

This was too much. The Conservative leadership in the Senate — notably Senator David Tkachuk, then the chair of the powerful Board of Internal Economy — seems to have circled the wagons.

Duffy's entry for June 22, 2011, records this: 

"Senate sits. David Tkachuk warns about complaints against Senate administration in intvw with Auditor General - message is: 'Don't rock the boat!'"

Duffy's next calendar entry says he met in the cabinet room with then-Conservative leader in the Senate Marjory LeBreton, Uppal, Tkachuk, and two top aides from the prime minister's office — Ray Novak and Derek Vanstone — "re Senate Tory caucus and Senate reform."

There's no record of how that meeting went.

'Not on priority list'

Duffy's diary for June 15 makes reference to a letter from reformist Alberta Senator Bert Brown, later leaked to the media, that said Uppal was "showered with complaints" from senators in caucus about the nine-year term limit. 

"Sen. Bert Brown sends e-mail to Senators urging us to be loyal to PMSG [sic] on Senate reform (Sends it to Libs by mistake - they release it to media)"

Elected Alberta Senator Bert Brown was sworn in early in Stephen Harper's tenure in 2007. Then-government Senate leader Marjory LeBreton, right, was in charge of keeping Harper's Senate caucus on-message. (Chris Wattie/Reuters)

The Saturday after that media leak, Conservative Senator Hugh Segal went on CBC Radio's The House to paper over the caucus cracks, saying all Tory senators would be voting in favour of Uppal's bill out of their "duty to doff our heads to the democratic will as expressed in that prior House."

Some fears may have diminished that fall. Note Sept. 27's diary entry:

"Senate Caucus — Marj LeBreton — Senate reform is NOT on govt legislative priority list"

And then this entry, the next spring (May 15, 2012) — blacked out by Duffy, but still visible under the marker:

"Senate Caucus - General unhappiness with the way govt can't get story out to media; Govt adding non-derogation clause to Senate Ethics bill @ MD's suggestion; Senate reform on the back burner, Bert Brown objects"

In the end, the Supreme Court put the kibosh on the government's reform plans.

Once again, Canadians seemed to be stuck with the status quo: you can't reform the Senate because you can't get the provinces to agree.

Now, if Duffy's defence counsel, Donald Bayne, is to be believed, we are stuck with a Senate where even the most blatantly partisan activities by senators are to be funded by the taxpayer. In effect, anything goes.

We'll see if the judge buys that. If he does, Duffy may not be alone if he writes in his diary, "Phew!"

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Greg Rickford pushes back following B.C. premier's spill response criticism

Federal cabinet minister says Christy Clark's criticism is 'premature'

By Evan Solomon, CBC News Posted: Apr 11, 2015 7:00 AM ET Last Updated: Apr 11, 2015 7:13 AM ET

Interview - Greg Rickford 12:46

Interview - Greg Rickford 12:46

Under intense criticism from the B.C. premier for what she called the "totally unacceptable" federal response to the toxic spill in Vancouver's English Bay, the government's Natural Resources Minister Greg Rickford responded by calling Premier Christy Clark's response "premature."

In an interview on CBC Radio's The House, Rickford echoed fellow cabinet minister James Moore's comments and defended the federal government's response to the spill, saying the situation is "well in hand and well under control. " He also commended what he called the Canada's "world class" safety system.
 

That contradicts Clark's brutal assessment of the response on Friday where she complained about the 6-hour delay in deploying booms to contain the toxic spill and the 12-hour delay to notify the city of Vancouver. She wants the federal government to relinquish responsibility for emergency response to the province and linked the spill to the controversial pipeline debate.

"There won't be any expansion of heavy oil movement out of this port or any other port in B.C. until we get world class spill response, period,"  Clarke said.

Minister Rickford tried to separate the spill from the debate about new pipelines, saying "we are talking about two different issues."

Vancouver Mayor Gregor Robertson was also very critical of the federal response to the spill. He called the efforts of both Ottawa and the province "totally inadequate."

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• Week One of the Mike Duffy trial Apr. 11, 2015 2:01 PM This week on The House, with week one of the Mike Duffy trial now in the books, we break down the first week of proceedings and the political implications of the case with the CBC's Terry Milewski, Radio-Canada's Emmanuelle Latraverse, the former law clerk of the House of commons Rob Walsh and the Senate's longest-serving member Anne Cools.

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Harper holds long, detailed discussion with Cuban President Raul Castro

Prime Minister Stephen Harper says he met with Cuba's president at the Summit of the Americas.

Harper told reporters he had a long and detailed discussion with Raul Castro late Saturday afternoon at the summit in Panama City, adding he thinks the time has come for a different approach to relations with the communist regime.

"We also are pleased that all the countries of the hemisphere are represented here and also of Canada's role of facilitating the American-Cuban dialogue that has allowed this to happen," Harper said earlier in the day, a reference to the broker role Canada played in helping the United States and Cuba agree to move toward normalizing relations.

It's a significantly different approach than the one Harper has taken with Cuba. Initially he opposed inviting Cuba to the summit.

Since then officials in the Prime Minister's Office have said Canada is encouraged by progress the Cuban government has made in areas such as human rights, although Harper remains concerned about this area.

U.S. President Barack Obama and Prime Minister Stephen Harper had a brief conversation while they went for a walk together inside the convention centre. (Adrian Wyld/Canadian Press)

Harper's handshake and discussion with Castro was overshadowed by the Cuban leader's meeting with U.S. President Barack Obama on Saturday, the first formal meeting between leaders of the two countries in more than half a century.

Harper's comments to the plenary session on Saturday also included an outline of his government's goals for the hemisphere, including the promotion of human rights, security and prosperity.

Harper said democracy is growing in the Americas as never before, but greater effort is needed to build on the progress.

"This includes: free, fair and regular elections, freedom of expression, freedom of association and freedom of assembly," Harper said. "It also means strong, autonomous institutions, including the judiciary, political parties, and independent media."

Earlier Saturday, Harper held a one-on-one discussion with Obama. The two leaders had a brief conversation while they went for a walk together inside the convention centre where the summit was being held. The conversation appeared light as the smiling leaders briefly passed news cameras.

A spokeswoman for the Prime Minister's Office said the pair discussed climate change and trade among other issues.

Cuba's participation in the summit is far from the only change over the last three years.

Ottawa has strained relations with the U.S. over Obama's move to veto a bill to approve the Keystone XL pipeline. It also has a chillier friendship with Mexico ever since it tightened visa requirements for Mexican visitors.

Harper will also host a reception to promote this summer's Pan Am and Parapan Am Games that will be held in the Toronto area.

On Friday evening, Harper had brief discussions with several leaders, including Mexican President Pena Nieto, Honduran President Juan Orlando Hernandez and United Nations Secretary General Ban Ki-moon, a spokeswoman said. He also met Netherlands Prime Minister Mark Rutte, an observer.

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Revenue Canada targets Steelworkers charity for political activities

A union-backed charity that wants Canadian mining companies held accountable for overseas misdeeds is among the latest to be targeted by the Canada Revenue Agency for political activities.

The Steelworkers Humanity Fund Inc. is still awaiting a verdict from the agency, nine months after an auditor showed up at the Toronto office and hauled away several binders of sensitive material.

The fund, with about $1.3 million in annual revenues, has supported Canadian food banks and provided disaster relief abroad since its founding in 1985.

But the charity's support of the Canadian Network on Corporate Accountability or CNCA, to which it gave about $37,000 in 2013, appears to have piqued the agency's interest.

"We've been part of this CNCA, and no doubt that's part of the rationale" for the audit, Steelworkers president Ken Neumann said in an interview from Toronto.

"It's quite clear that it's targeted to folks that speak up sometimes against the government's policies."

The Canada Revenue Agency launched a series of 60 political-activity audits in 2012, after the Harper government publicly tagged some environmental charities as radicals and money-launderers and possibly linked to terrorists. The federal budget that year earmarked $8 million for the special audits, later increased to more than $13 million through to 2017.

Audit net widens

The first wave of such audits hit environmental charities, but the net has since been widened to capture human-rights organizations, anti-poverty groups, international-aid and religious groups. Other labour-supported charities have been targeted previously, including CoDev and the Canadian Centre for Policy Alternatives.

Many charities undergoing political-activity audits have been outspoken against Harper government policies, and the audits have tied them in knots, draining resources. At least one group has lost its coveted charitable status, while others report self-censoring their public statements for fear of aggravating the auditors.

'They would see us as a thorn in their side.'— Steelworkers president Ken Neumann

The Canada Revenue Agency, however, says its choice of which charities to audit is made at arm's length from government, with no input from any cabinet minister, including Revenue Minister Kerry-Lynne Findlay. The agency declined comment on the Steelworkers audit.

The United Steelworkers' Canadian arm has frequently butted heads with the Conservative government over issues such as perceived lack of support for the manufacturing sector and what it sees as anti-labour policies.

The Steelworkers' charity draws largely on a one-cent-an-hour donation from union members, worth between $20 and $40 annually from workers, who can also opt out.

The fund gives about two per cent of its annual revenues to the non-charitable Canadian Network on Corporate Accountability, an umbrella group that includes faith groups, environmental NGOs and others, and is avowedly political, working to hold mining companies accountable in Canada for overseas misbehaviour.

Revenue Minister Kerry-Lynne Findlay has repeatedly rejected any suggestion that she directs which charities the Canada Revenue Agency will audit for their political activities. (Adrian Wyld/Canadian Press)

Under the tax agency rules, charities can devote up to 10 per cent of their resources to political activities, and the Steelworkers' charity fund reports no political activities other than its small role in the CNCA, worth two per cent of all expenses.

The audit is looking specifically at the fund's formal agreements with the Canadian Network on Corporate Accountability, as well as any "non-partisan actions concerning the retention, opposition or change to any law, policy or decisions of any level of government in any country."

Clashes with government

The network clashed with the Harper government as recently as last month, when it said a newly appointed ombudsman for corporate social responsibility was toothless, and that Canada needs tougher laws to deal with rogue mining companies.

"They would see us as a thorn in their side," said Neumann. Prime Minister Stephen Harper has "got his scope clearly on us. … These [audits] aren't random."

Last month, the charity Dying With Dignity had its charitable status annulled after a Canada Revenue Agency audit. And the charity Environmental Defence says it is appealing an adverse ruling from the agency after an audit.

The agency says that, as of March 31, it has completed 21 political-activity audits, with 28 still underway. Another 11 audits are to be started before the project ends in 2017. Officials will not identify any of the target charities because of the confidentiality provisions of the Income Tax Act.

So far, five charities have received notices of the agency's intention to revoke their charitable registration, while six have received education letters, and eight have been asked to sign compliance agreements for more grievous problems. There has also been one voluntary revocation, and one annulment, Dying With Dignity.

Follow @DeanBeeby on Twitter

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