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Progressive Conservative Dorothy Shepherd said New Brunswickers deserve to know why the former Liberal government gave a $50 million loan to the Atcon Group. ((CBC))

There may be a legal showdown looming at the New Brunswick Legislature over access to secret documents detailing a controversial loan given to the Atcon Group.

A senior bureaucrat refused Friday to answer a key question from a legislative committee of MLAs, who want to know what advice civil servants gave the former Liberal government about the $50 million loan guarantee.

The public accounts committee wanted to know whether civil servants recommended for or against the loan guarantee given to the Miramichi-based Atcon Group.

In 2009, the New Brunswick government extended three different loan guarantees to Atcon worth a combined $50 million. Those were on top of earlier loan guarantees and loans, which elevated the provincial government's exposure to roughly $70 million.

The money evaporated when Atcon went bankrupt a year later.

On Friday, Bill Levesque, deputy minister of Business New Brunswick, refused to answer a question twice about what advice he gave the former government on whether or not the loan was too risky.

Levesque said it would be inappropriate to reveal confidential advice.

Progressive Conservative MLA Dorothy Shepherd, who asked Levesque for the information, said the people of New Brunswick deserve to know the answer.

"We think it's fair, at $72 million, that the people of New Brunswick understand how those decisions were made," she said.

After Levesque refused to answer the question, the committee voted to order him to answer. Business New Brunswick is consulting its lawyers about whether to comply.

If the advice is contained in a cabinet document, then it's protected by law — cabinet documents are secret, and that trumps the committee's request.

If the advice is not considered a cabinet document, however, Levesque will likely have to turn it over.