Scandal could spell doom for Canada's PM

CANADA: Around an oval table in a wood-panelled committee room of the parliament in Ottawa a crisis in Canadian politics is …

CANADA: Around an oval table in a wood-panelled committee room of the parliament in Ottawa a crisis in Canadian politics is playing itself out which could spell doom for Mr Paul Martin's Liberal Party government. Conor O'Clery reports from Ottawa.

Mr Alfonso Gagliano, in pink tie and gold-rimmed glasses, is testifying to a parliamentary tribunal that as government minister he knew nothing about what is known as the Adscam scandal in his department.

As observers and committee members sipped coffee during yesterday morning's session, the committee chairman, Conservative MP John Williams, warned that Canadian democracy itself was threatened if the former minister of the Crown refused to accept responsibility for his department.

Mr Gagliano consulted his heavy-set legal adviser and replied in his heavy Italian accent that he could not do so.

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"You are asking me to incriminate myself and I won't do that," he said. "I wanna make that clear."

The silver-haired Mr Gagliano maintains that he is the victim of "a fiasco that was not of my doing" and that he has been vilified to the extent that he cannot even go to his local shopping mall.

The fiasco, which was uncovered by the Auditor General last November, concerns the expenditure of $250 million (Canadian) by Mr Gagliano's Public Works department between 1997 and 2001 in a sponsorship programme to promote federalism in Quebec - by, for example, placing ads in newspapers and flying Canadian flags at sporting events.

Over $100 million of this was paid in inflated fees and commission to agencies who had little to show for it but made big contributions to the Liberal Party, for which Mr Gagliano was a major fund-raiser.

Members heaped scorn on Mr Gagliano's protestations that he didn't see, hear or ask what was going on.

"He's giving us the O.J. Simpson defence. He's going to find out who the real killer was," mocked his chief tormentor, Conservative MP Jason Kenney.

The Prime Minister, Mr Martin, who took office in December, was finance minister at the time but has denied any knowledge of what was going on. However, the Liberal Party has seen its approval rating plummet to 38 per cent nationwide over the Adscam affair.

Mr Martin must go to the country soon, with diplomats betting on a June election. He is personally popular, with 56 per cent support, but the televised hearings, which has Canadians riveted to their TV screens, is doing immense damage to the Liberal Party.

The opposition Conservative Party, even though rudderless - they are choosing a new leader this weekend - is up to 26 per cent, and in Quebec, where the Liberals need 50 of the 75 seats to form a majority government, they are 18 points behind a revived nationalist Bloc Quebecois.

Mr Gagliano, who was sent to Denmark as ambassador by former prime minister Mr Jean Chrétien after a government reshuffle and fired when the scandal broke, has been denying to the committee that he did any of the dirty work.

He testified he did not know of problems with the programme to protect Canada from the threat of Quebec separatists, saying it was run mainly by a senior civil servant, Chuck Guité.

The tribunal wants to question Mr Guité, who retired in 2002, about this and about who gave him political direction.

Mr Gagliano denies that he gave any political direction and that he met Mr Guité only a few times a year to sign multi-million dollar cheques, without ever asking to see any documentation.

So where is Mr Guité today? The retired bureaucrat is holidaying in Arizona, and, according to his lawyer, unfortunately would not be able to appear as requested before the tribunal next Thursday.