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Jean Chrétien and the scandal over his Grand-Mère

The Story

Five years before he became Canada's top dog, Jean Chrétien bought the Grand-Mère hotel golf course in his hometown of Shawinigan, Que. Chrétien's ownership of the golf course was a source of historical vengeance. Chrétien was once barred from the course because of his francophone heritage, biographer Lawrence Martin explains in this CBC report. When Chrétien was elected prime minister in 1993, he decided to sell his shares in the properties. The controversy dubbed "Shawinigate" stemmed from a phone call the prime minister made to the federally owned Business Development Bank of Canada in 1996. Chrétien was lobbying for a loan for Yvon Duhaime, the friend who bought Auberge Grand-Mère. The BDC would eventually approve a $615,000 loan for Duhaime, having rejected a previous $2 million loan request. The fateful call was made in 1996 but it turned out Chrétien wasn't paid for the properties until 1999. The prime minister was then accused of being mired in a conflict of interest. Federal ethics counsellor Howard Wilson was called in to examine the issue at the centre of the controversy: When exactly did the prime minister stop having an "interest" in the properties?

Medium: Television
Program: The National
Broadcast Date: March 28, 2001
Guest(s): Michael Bliss, Sally Gunz, Lawrence Martin, Andrew Stark
Host: Peter Mansbridge
Duration: 13:08

Did You know?

• Federal ethics counsellor Howard Wilson later ruled it was entirely appropriate for Prime Minister Jean Chrétien to call BDC on behalf of Duhaime, a Shawinigan constituent. Chrétien was cleared of any wrongdoing in helping the innkeeper secure federal aid.

• Chrétien appointed Howard Wilson as the first-ever federal ethics counsellor in 1994. Wilson's mandate was to uphold the code of conduct for public office holders, enforce a lobbyists' code of conduct and, at the prime minister's request, probe the ethical conduct of cabinet ministers. He had no special investigatory powers. In 2004, Wilson's former deputy testified in court that Chrétien vetted all of Wilson's rulings, including ones about Chrétien himself.

• The opposition parties accused Wilson of being the prime minister's "lapdog" and repeatedly urged Chrétien to create the more independent post of ethics commissioner, reporting directly to Parliament rather than to the prime minister.

• Despite Wilson clearing Chrétien of wrongdoing, the controversy over the Auberge Grand-Mère continued. It gained momentum in September 2003 when the wrongful dismissal suit by the former president of the Business Development Bank of Canada began in Montreal. François Beaudoin sued his former employer, saying he was forced to resign and was denied suitable pension because he had dared to question the $615,000 loan to Yvon Duhaime.

• In February 2004 Beaudoin won his lawsuit against the BDC and received $200,000 in annual pension and $245,000 in severance package.

• Prime Minister Jean Chrétien withstood allegations of impropriety in the Shawinigate controversy and went on to win a historic third majority in 2000.

• In 2002 Chrétien announced long-promised ethics reforms. They included an independent ethics commissioner, along with changes to the rules governing lobbyists. The new ethics commissioner would also report directly to Parliament, not the prime minister.

• Chrétien's successor, Paul Martin, chose former McGill University administrator Bernard Shapiro as the first ethics commissioner, a choice approved by Parliament. Shapiro was appointed to a five-year term overseeing an existing code of conduct for cabinet ministers and a new one for other MPs. The commissioner tables annual reports in the House of Commons but has no power to discipline politicians. Chretien


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