New Brunswick

Brian Gallant stands by 6 ministers from Atcon loan fiasco

Premier Brian Gallant says he won’t ask six of his cabinet ministers to resign for their role in the 2009 Atcon loan-guarantee fiasco.

Premier dismisses Conservative call for Liberals with 'Atcon blood' on hands to resign

Premier Brian Gallant says six members of his cabinet were reelected in 2010 and 2014 despite approving $70 million in questionable loan guarantees for Atcon. (CBC)

Premier Brian Gallant says he won’t ask six of his cabinet ministers to resign for their role in the 2009 Atcon loan-guarantee fiasco.

Gallant says the ministers were all re-elected in 2010 and 2014 despite the public knowing about the Atcon affair costing taxpayers more than $70 million.

Victor Boudreau (CBC)
"The people of New Brunswick elected these people with no asterisk saying `We elect them to represent us but don’t put them in cabinet,’" Gallant told reporters.

The Progressive Conservative opposition took the rare step on Wednesday of calling for the resignations of six ministers, all of them veterans of the Shawn Graham cabinet that approved $63.4 million in loan guarantees to the Atcon group of companies.

The ministers are Victor Boudreau, Donald Arseneault, Rick Doucet, Ed Doherty, Denis Landry and Brian Kenny.

Denis Landry (CBC)
"I demand that Premier Gallant show real leadership and fire every Liberal minister who still has Atcon blood on his hands," PC MLA Brian MacDonald said in the legislature.

MacDonald said Gallant should also fire two other Graham cabinet veterans, Greg Byrne, his chief of staff, and Hedard Albert, the government house leader who is not a minister but who sits at cabinet.

But Gallant told reporters there’s already been consequences for the Liberals from the Atcon disaster.

Donald Arseneault (Jacques Poitras/CBC)
"The people of New Brunswick knew what happened with this file," he said. "It was all made very public. The people of New Brunswick were frustrated and probably still are, and I don’t blame them.

"They sent a strong message to the past Liberal government in 2010, a message that was certainly heard, and we saw the results of the 2010 election."

But in brushing off calls for a mass firing of cabinet ministers, Gallant also acknowledged the Atcon decision was a mistake.

Rick Doucet (CBC)
New Brunswick Auditor-General Kim MacPherson released a report on the case this week that said the Graham cabinet showed "a troubling disregard" for taxpayer dollars when it approved the loan guarantees.

Atcon went bankrupt in 2010 and because the Graham cabinet gave up its security over the loan guarantee, taxpayers have recouped less than $400,000 of the $70 million that was lost.

"I think what’s important for us today is to learn from mistakes of the past," Gallant said.

"This file is certainly a mistake. No one’s arguing with that."

Brian Kenny (Liberals)
Gallant says the CEO of the new Opportunities New Brunswick economic development agency has already met with MacPherson to get her ideas on improving the process of giving companies government subsidies.

MacPherson has also recommended the government clarify one area of disagreement: while she says Victor Boudreau, the minister of Business New Brunswick at the time, broke regulations in releasing the province’s security over the loan guarantees, the government told her he did not.

MacPherson says with legislation to create Opportunities New Brunswick still before the legislature, the government should resolve the difference of opinion in the bill.

Gallant says that’s one thing the government will consider.

Ed Doherty (NB Liberals)
But he rejected MacPherson’s suggestion that she could pursue a more in-depth forensic audit of the Atcon case if her office had more resources.

MacPherson wrote that her audit "may not all answer all remaining questions the public may have" about Atcon.

She said she was prepared to investigate further but her office would need extra funding.

Gallant says given MacPherson found "no new information" and she said "we have already spent much money and time on this issue … we will not support a forensic audit."

Dire economic situation

For the second straight day, none of the ministers who served in Graham’s cabinet and approved the Atcon loan guarantees would speak to reporters at the legislature.

But Graham’s former chief of staff, Bernard Thériault, told Radio-Canada that while the decision was clearly a mistake, MacPherson should have acknowledged the dire economic situation in Miramichi at the time.

"They’d lost 1,500 jobs," he said. "The only employer that was still standing, just about, was Atcon."

Thériault said the government was "desperately" looking for ways to create and maintain jobs in the area, and wanted to save Atcon if it could.

He said civil servants also recommended against helping the Twin Rivers mill in Edmundston, but the Graham Liberals came to its aid as well — and in that case, the company survived.

Thériault blamed the Bank of Nova Scotia for forcing the government to give up its security on the loan guarantee.

The lost $70 million "didn’t go to Robbie Tozer or Atcon," he said. "It went to the bank."


Jacques Poitras

Provincial Affairs reporter

Jacques Poitras has been CBC's provincial affairs reporter in New Brunswick since 2000. Raised in Moncton, he also produces the CBC political podcast Spin Reduxit.


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