The "No" side that opposed sovereignty in Quebec's 1995 referendum illegally spent more than half a million dollars on its campaign, according to a report on the former Montreal-based lobby group Option Canada.

The report, penned by retired Quebec judge Bernard Grenier and released Tuesday, blames a handful of federalists working for the "No" camp for misspending referendum campaign dollars and violating provincial election laws.

Grenier concludes that Option Canada and the Canadian Unity Council (CUC) illegally spent about $539,000 originating from the federal Heritage Department during the campaign, and a total of $11 million before and during the campaign to prop up the "No" side before it eked out a narrow victory in October 1995.

The misspending fell far short of allegations from the two Montreal-based writers who sparked Grenier's probe. Robin Philpot and Normand Lester had alleged that millions of dollars were funnelled from the federal government — then under Jean Chrétien's Liberals — to bolster the "No" campaign. The writers had accused Option Canada alone of illegally spending $3.5 million to convince Quebecers to vote against sovereignty and separation.

"We cannot, just to be more popular, enhance figures that didn't exist," Grenier told reporters in Quebec City on Tuesday.

Neither Quebec Premier Jean Charest — who was then vice-president of the "No" committee — nor any other politicians were singled out in Grenier's report. Political analysts had predicted Charest's credibility would be damaged if Grenier implicated him in the report or found the "No" forces breached electoral laws, which limit campaign spending to $5 million.

Instead, Charest — whose Liberal minority government is already bracing for possible defeat in a vote this week over a budget containing controversial federally-funded tax cuts — told the national assembly on Tuesday that he felt vindicated by the report.

Impossible to say if misspending influenced vote

Grenier chastized five people involved in the "No" side and Option Canada, which was created to promote "linguistic duality" but was not supposed to be directly involved in the campaign.

However, he pointed out he did not conduct his investigation in the capacity of a judge and cannot determine civil or criminal guilt.

"There's no question of criminal charges," he said. "It's only an opinion. It's not a judgment of guilt or civil liability."

The report singles out several key players, saying that:

• René Lemaire, the director general of Option Canada, spent money without obtaining the authorization of the official agent representing the Committee of Quebecers for the "No" side.
• Jocelyn Beaudoin, the director general of the CUC, was involved in spending decisions at Option Canada that led to non-authorized expenditures.
• Réjean Roy, the financial comptroller for CUC and Option Canada, helped clear unauthorized expenditures.
• Claude Dauphin, the past president of Option Canada and a current Montreal elected official, failed to exercise vigilance by receiving unreported and unauthorized remuneration. However, Grenier said Dauphin did not act in bad faith.
• Nathalie Bernier, the official agent of the "No" side, did her job with integrity but chose not to intervene to ensure Option Canada was following spending rules.

Quebec's elections director, Marcel Blanchet, said it was impossible to say whether the questionable campaign spending found by Grenier impacted the final referendum result.

"What we know now is that lots of money was spent illegally during this period. Would it have changed the result? It's not clear," Blanchet said.

Grenier urges Quebecers to 'move ahead'

The Canada Rally drew 100,000 to Montreal in October 1995 on the eve of Quebec's referendum.
(Canadian Press)

Grenier's report also addressed allegations that federal money was pumped into a massive pro-Canada Montreal rally in late October 1995, which attracted about 100,000 people, many of whom travelled from across the country.

The "love-in" was severely criticized by the "Yes" camp, but Grenier said there was no foregone evidence it was part of a greater plan to sabotage the sovereigntist movement.

"We look[ed] and we didn't find anything, and it's a fact, it's a pure fact," he said. "The answer is that with all our efforts we did not find the answer."

Grenier urged Quebecers to now turn the page on on what was an emotional and sensitive time in their history. "I think it's now time to move forward, to move ahead," he said. 

The second part of his report will issue recommendations for tighter rules about electoral spending.

'Government injecting secret money,' authors alleged

Acting on a tip in January 2006, Lester and Philpot had dug up trash bins filled with ledgers and cheque stubs that they later showed to reporters.

The two authors — both of whom have sovereigntist sympathies — wrote a book detailing how they believed millions of dollars from Option Canada ended up bolstering the federalist campaign.

"We have a very, very serious case of the government injecting secret money — illegally — to deny a legitimate political debate from taking place," Philpot charged.

Quebec's director general of elections asked Grenier in 2006 to investigate the allegations in 2006, calling on Charest to testify.

With files from the Canadian Press