Health Canada's abrupt decision in September to back down from expanding warning labels on cigarette packages came after tobacco company lobbyists waged a co-ordinated, sometimes secretive lobbying campaign, CBC News has learned.
An analysis by CBC News of lobby registry filings and other documents reveals tobacco executives and their paid lobbyists communicated dozens of times with key government ministries and their policy advisers, including the Prime Minister's Office.
The big three tobacco companies, Imperial Tobacco Canada, JTI-Macdonald Corp. and Rothmans, Benson & Hedges Inc., lobbied a combined total of 53 times in just over two years, according to the registry. When other industry associations and smaller tobacco companies are factored in, the number of "communications" jumps to 82.
One communication on Sept. 9, between JTI-Macdonald and the Prime Minister's Office, took place just five days before the decision to cancel the program became public.
The expanded warning label program was set to increase the size of the warnings on cigarette packages, contain a variety of different graphic images and include a 1-800 Quit Line on all tobacco products.
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But in September, Health Minister Leona Aglukkaq said plans to update warnings on cigarette packages had been halted, and the government's new focus would be on fighting the sale of contraband cigarettes.
The decision to drop the program at the last minute has confused observers who had been told by senior officials at the Ministry of Health that the updated warning labels would be rolled out on May 31 — World No Tobacco Day.
The CBC News investigation also reveals that in several cases, lobbyists hired by tobacco companies have close ties to the Conservatives.
In addition, Perrin Beatty, a former Conservative health minister who in the early 1990s made Canada a world leader on cigarette warning labels, registered as a lobbyist for the Canadian Chamber of Commerce.
Beatty told CBC News he never personally lobbied on the file, but his organization spoke with officials in Ottawa to oppose the plan to increase the size of warning labels to 75 per cent from 50 per cent.
The Chamber of Commerce was one of many organizations lobbying against the measure this summer, lobby registry documents show.
"I think it would be a shock to Canadians if lobbying was actually behind the decision to delay these warnings," said Dave Hammond, a University of Waterloo professor who consulted on the tobacco warning labels for Health Canada. "It's all about preventing youth from picking up smoking."
Between July 2008 and September 2010, tobacco companies and their lobby firms met 15 different federal departments, including seven times with the Ministry of Health and four times with the Prime Minister's Office on several different topics.
The lobby registry does not provide specific details about what was discussed. However, the majority of lobbying activity relates to the issue of contraband cigarettes, which critics argue was part of a campaign on the part of the tobacco industry to change the focus away from the idea of expanding warnings on cigarette packages.
"They use contraband as a blunt weapon to try and beat down anything else that might be effective," Hammond said.
In a statement, the office said: "Our government meets regularly with companies, NGOs, and industry associations on a broad range of topics. For the past two years the vast majority of these meetings, including those with the Canadian Chamber of Commerce, have focused on the economy."
CBC News has learned that Canada's three major tobacco companies employed lobbyists with strong Tory ties.
Duncan Rayner was the director of operations for the Conservative Party of Canada and played a central role in drafting the agreement that led to the merging of Canada's two conservative parties.
Rayner, who now works for the firm Temple Scott, lobbied on behalf of Imperial Tobacco. Lobby registry records show he communicated as many as 19 times on several different topics, including contraband tobacco. He also lobbied several government departments, including the office of the minister of health.
Citing client confidentiality, Rayner declined to discuss his lobbying efforts.
Ezra Levant, another former Tory insider, also registered as a lobbyist for the tobacco industry. In 2002, he stepped aside as a federal candidate for the Conservative Party in a Calgary riding so Stephen Harper could run there.
Levant registered as a lobbyist for Rothmans, Benson & Hedges for a year, in 2009. According to the lobby registry, Levant communicated on two occasions, in March 2010, on the topic of international trade. He also registered to deal with the issue of an anti-smoking hotline.
"I de-registered … I am no longer a lobbyist, I no longer have any interest in the file," he told CBC News. "I no longer follow the matter."
Perrin Beatty, as president of the Canadian Chamber of Commerce, registered on behalf of the chamber, which lobbied against increased warnings on cigarette packages. Beatty told CBC News that one of his staff lobbied Ottawa on this topic and not himself personally.
The Canadian Chamber of Commerce was also part of a national coalition against contraband tobacco whose other members include the Canadian Tobacco Manufacturers Council.
Records show that in 2009 and 2010, Beatty's organization lobbied the government a total of 27 times on the topic of intellectual property, including five occasions with government ministers and four with the Prime Minister's Office.
At some point during this process, Beatty told CBC News, the chamber was informed that the plan to update the warnings would likely be put on hold.
"The response [we] received was that it was unlikely it was proceeding this year," he said.
Also registered to lobby on tobacco for Rothmans and the Canadian Convenience Store Association was Eric Duhaime, a former adviser to Stockwell Day from their time in the Canadian Alliance.
Rothmans also hired Crestview Public Affairs, a lobby company founded in 2004 by Mark Spiro, a Conservative insider and former campaign manager for Ontario Conservative Leader Tim Hudak.
Around the time the health minister told her provincial counterparts she was quashing the new labelling initiative, Crestview Public Affairs made a flurry of new registrations on tobacco-related topics.
Spiro was not involved in the lobby efforts, but three of his staff registered on the tobacco file — one for Rothmans and two for the Canadian Convenience Store Association.
Former staffer Kaylie Wells first registered in 2008 on the file but left the firm in 2009.
While a CBC News analysis of the lobby registry reveals the existence of a longstanding campaign, many of the details are still shrouded in secrecy.
"[The tobacco industry] has a lot of clout and influence," said Dr. Matthew Stanbrook, deputy editor of the Canadian Medical Association Journal. "So it's not hard to speculate about whether they put pressure on the government to make some changes all of a sudden, but we don't know any of the details about that that are public."
Some argue the lobby registry itself requires so little information that the public may never know about all the meetings that happen between lobbyists and government officials.
"There's no way of knowing conversations that take place over golf games or cocktail parties or people who float between one world and another," said Cynthia Callard of Physicians for a Smoke Free Canada. "So it's very difficult for outsiders to know exactly what's going on."
For example, there are no records of what actually was said in the dozens of meetings that took place between government officials and the tobacco industry, only vague descriptions of the topics discussed, like "intellectual property" or "contraband cigarettes."
There is also no indication if the meetings resulted in any action or decisions on the part of the government or if any written material changed hands.
Despite dozens of phone calls to government officials who were lobbied and to the tobacco lobbyists themselves, no one would talk about the details of the lobbying.
"We've had promises going back 20 years to bring lobbying out of the shadows and require lobbyists to describe all the details of their activities," said Duff Conacher with Democracy Watch. "And here we are 20 years later and lobbying in the shadows and disclosing only vague information about your lobbying activities is still legal."
The contraband argument
All of this means the public is still largely in the dark about what exactly persuaded the Harper government to back down on labelling and make contraband its priority.
Jim Rondeau, the Manitoba minister of healthy living, was at the closed-door meetings where Health Canada announced it was backing down from updating warning labels.
"The question was asked 'Why' multiple times," Rondeau said. "The response was they were going to focus on contraband."
Beatty had been making that suggestion for months. He argued contraband should be Health Canada's priority, not cigarette warning labels.
"Every second cigarette that is smoked in Ontario, according to studies that have been done, is a contraband cigarette," Beatty said in an interview. "The figure is about 40 percent in Quebec. This is a direct threat, not just to law enforcement, but it's a threat to the health of Canadians as well."
Indeed, Beatty and others argue that larger warning labels might actually lead to an increase in contraband tobacco sales.
"There is a significant share of the market that it is being fuelled by organized crime," he said. "Do we want to make it easier for organized criminals by eliminating the ability of other people to offer brands in competition?"
In letters to three federal ministers, the Canadian Chamber of Commerce describes the contraband problem as "booming" and likely to make up as much as 50 percent of the market by this year.
However, the sale of contraband tobacco may actually be on the decline in Canada, according to statistics from Health Canada. Its numbers show a decline in contraband cigarette consumption beginning in 2009. That same year, name brand tobacco sales in Canada rose 3.9 per cent.
Moreover, in its third quarter report for 2010, Tobacco giant Philip Morris International, appeared to confirm those numbers, telling shareholders the sale of legal cigarettes in Canada was up 4.2 percent "mainly reflecting government enforcement measures to reduce contraband sales."
Hammond, the professor, wonders why the government could not pursue both initiatives at the same time.
"I think when people look around for an answer of why these things have been delayed, there's no public health argument, reason from an evidence stand point, I think it's logical to ask, what is the oppositional force to these things?" Hammond said. "Let's make no mistake. This is still a very strong, powerful industry that remains very profitable in Canada."
Callard, with Physicians for a Smoke Free Canada, said the worldwide tobacco industry has a history of working behind the scenes to make its point.
"By and large they threaten, they bully, they cajole, they seduce and they purchase support and they've done that for decades," she said. "So it's no surprise that they've been successful this time and it's sadly no surprise why they're successful."
An earlier version of this story said the Prime Minister's Office declined a CBC News request for an interview. In fact, the office was not asked for an on-camera interview.Dec 16, 2010 1:30 PM ET