November 24, 2004

Agencies associated with the Liberals and Conservatives were represented, along with other admirers Mr. Guite had gathered over the years. Many of them were recipients of the federal largesse the bureaucrat had seemed to control, but many of them apparently had a genuine affection and respect for the man they had come to toast.

The 100 or so wellwishers at the press club ate a good meal and each received a Roots fisherman-style hat. It was ideal for the occasion because Mr. Guite, a keen salmon fisherman, is well known among his friends and acquaintances as a hat lover. Indeed, hats were the theme gift of the evening. Mr. Guite, who also enjoys sailing, took a particular shine to a naval captain's cap, which he wore most of the night.

Several guests offered testimonials at the party.

One businessman recalled during an interview that guests had lauded Mr. Guite's ability as a fixer -- someone who could get things done quickly and who could skate around the bureaucratic rules and regulations while others concerned themselves with writing memos, filling out forms and other time-consuming paper trails. When a job needed to be done, and done fast, Chuck Guite had been the man to call.

Much to the delight of the party-goers, one of the more generous public tokens of appreciation during the party came from an advertising executive who surprised Mr. Guite and his wife Lucile with a trip to California. The company had done business with Mr. Guite since the Mulroney years.

When he left the public service, Mr. Guite had been in charge of advertising and polling contracts for the Mulroney and Chretien governments, and was uniquely connected with executives in advertising and polling. Since the mid-1990s, he had been overseer of the $250-million federal sponsorship program which, according to Auditor General Sheila Fraser, was a rules-free zone through which $100 million in taxpayer money was skimmed off in dubious commissions by Liberal-connected ad agencies.

After a long winter vacation in Arizona, Mr. Guite returned to Ottawa earlier this month wearing a cowboy hat and, as cameras captured his arrival, a look of extreme irritation.

Mr. Guite will appear before the House of Commons public accounts committee this week to be questioned about his pivotal role in the affair. Through his lawyer, he has declined requests to be interviewed for this article.

As Ms. Fraser and members of the committee have noted, the lack of a paper trail has made auditing the sponsorship program a major challenge.

The program, pushed emphatically by a panicked then-prime minister Jean Chretien following the near-disastrous October 1995 Quebec referendum, employed advertising agencies to put Canada and the federal brand front and centre in Quebec and, to a lesser extent, in other provinces. This was in sharp contrast to the previous policy of deliberate understatement instituted by Brian Mulroney's Tory government, that felt too much obvious Canadian presence in Quebec might fan the separatist flames.

During closed testimony to the House of Commons public accounts committee last summer, Mr. Guite cast himself as a lone Captain Canada and adopted a desperate-times-demand-desperate measures defence. Canada was "at war" with separatists, he said, so rules had to be broken -- or rather bent. Too much paper in the files would have been too risky, so he issued hundreds of thousands of dollars in contracts orally and received oral reports from advertising agencies in return.

"When you're at war," he told MPs, "you drop the book and the rules and you don't give your plan to the opposition. You don't leave your plan of attack on your desk."

Mr. Guite said he met regularly with his boss, then-public works minister Alfonso Gag-liano -- a major point of disagreement between the two -- but the decision to tinker with the government's contracting rules was his alone.

"Nobody instructed me not to put documents on file or not to put certain information on file," he told MPs. "I decided that ... during the referendum and post-referendum, it was my decision to keep very little information on file so nobody would have access to it."

And in a pause for self-congratulation, Mr. Guite suggested he would do it again if he had to.

"I was very successful in achieving what the government of Canada wanted to achieve," he said, "and that was to have a big presence in Quebec and to reduce le parti separatiste au Quebec, which we have done tremendously well. ... The proof is in the pudding."

Then-Liberal-now-Tory MP John Bryden asked Mr. Guite rather sarcastically if he was familiar with the federal Access to Information Act, the system through which citizens can apply to get government documents, but a system that the government has also become adept at blocking for its own convenience. In other words, any document in Mr. Guite's files the government chose not to release to the public would have remained secret.

Mr. Guite's response was curt: "Hindsight is 20:20."

During the testimony, NDP MP Pat Martin extracted a hint of the relationship between Mr. Guite and Groupaction, one of the companies at the centre of the sponsorship scandal.

Mr. Martin asked Mr. Guite whether he had sold a red Ford Mustang to Jean Brault, president of Groupaction Communications, while the agency was getting contracts from Mr. Guite.

"It has to do with the relationship, a possible relationship, between Groupaction, the very contractor, and you, a civil servant," said Mr. Martin as he tried to extract an answer from Mr. Guite. "It would be improper to benefit in any way, shape or form, even if that's just the convenience of having somebody take an expensive car off your hands. It would indicate to me far too cosy a relationship. I want to know if this is true."

After refusing to answer the question on the grounds it had nothing to do with why he was giving evidence to the committee, Mr. Guite admitted Mr. Brault had bought his car.

Since Mr. Guite's first appearance last summer, his bosses -- Mr. Gagliano and former department deputy minister Ran Quail -- have appeared before the committee to claim their innocence and ignorance of any wrongdoing by others.

Mr. Quail told the committee, in so many words, that Mr. Gagliano did end runs around him and dealt directly with Mr. Guite. Mr. Gagliano said he met with Mr. Guite only three or four times a year and, as minister of a huge department, didn't concern himself with details of contracts.

Huguette Tremblay, a senior bureaucrat who reported directly to Mr. Guite -- she is also his friend -- contradicted Mr. Gagliano and said the former minister met weekly with Mr. Guite, who sometimes returned from the meetings with direct orders which, he told his staff, could not be questioned or contravened.

Whatever the truth about his dealings with his minister, Mr. Guite had access and regular meetings with someone more important: Mr. Chretien's chief of staff, Jean Pelletier. As members of the Commons committee noted during Mr. Pelletier's recent testimony, such access for a public servant in Mr Guite's position was uncommon, to say the least.

Mr. Guite was seen as an ideal bureaucrat by members of the advertising community because of his ability and willingness to move at their own pace.

The businessman who attended Mr. Guite's press club retirement party, and spoke on condition his name not be used, said it was well known among the advertising and polling communities that "if you wanted money from the federal government you had to go through Chuck.

"Ottawa is like a big coat with a ton of pockets," he said, "but you have to know where all the pockets are, otherwise you can wait months before you get 10 cents."

Mr. Guite's career as overseer of federal advertising and polling contracts was in full swing during the Mulroney era when an already established system of patronage in that field was fine-tuned by the Tory government.

It was during those similarly politically charged times that Mr. Guite began taking liberties with the contracting rules.

During the Mulroney era, Mr. Guite reported directly to the chairman of the Tory cabinet communications committee, Senator Lowell Murray, whom Mr. Guite referred to simply as "The Senator."

That same cabinet committee post would be held a decade later by Mr. Gagliano.

Pollster Conrad Winn, whose firm COMPAS began competing for government contracts during the Mulroney years and has no political party affiliation, said he never met Mr. Guite, but realized quickly that the bulk of polling work was being funnelled to firms with Tory connections.

"There was nothing objective about contract allocation. It was dictated either by the minister in charge or the party. But it has a long heritage: There was serious patronage in the Trudeau period and passionate patronage in the Mulroney period. The Mulroney government got into so much hot water because they did it so efficiently. The public got totally exacerbated -- as they are now."

But, added Mr. Winn, some public servants found ways to thwart the blatant politicization of the contracting system.

"A lot of public servants lived in fear of being punished if they didn't choose the preferred supplier. They were more worried about their mortgage payments than being the subject of an obituary saying how brave they had been. But others in government were courageous and stood up to their minister or hid what they were doing by breaking contracts into small pieces."

The Mulroney government, with the 1992 Charlottetown referendum to fight and Canada's 125th birthday to celebrate, perfected a system of giving non-tendered contracts to political friends -- pollsters and advertising companies that supported the Tory cause for free during election campaigns in return for a later lion's share of the millions of dollars in taxpayers' money every government spends on polling and advertising.

Contracts were awarded during the Tory years in contravention of clear Treasury Board policy, which dictated contracts could only be awarded after a competitive, points-based process overseen by a committee of public servants. After that process was completed, a written report had to be produced explaining why the winner had been chosen.

No written reports were produced and advertising and polling firms suspected that the fix was in before the "competitions" took place. Citizen stories revealed that firms without Tory or political connections took part to please the government and give the process an aura of legitimacy. In return, they were given minor contracts.

In an interview with the Citizen more than a decade ago, Mr. Guite said he saw no need for a written report on the competition for one multimillion- dollar contract, saying he reported orally to Mr. Murray.

He also confirmed that Treasury Board policy was not followed because "the policy is a guideline. It's not a rule."

"We change the guidelines to fit the situation. ... It was not the first time it's been done and not the last time."

Ms. Fraser's predecessor, Denis Desautels, decided against subjecting the contracting pro-cess to an audit and there was no evidence that under the Tories money was paid out in phantom commissions or otherwise scammed in ways described by Ms. Fraser.

Around the time the Liberals came to power in 1993, Mr. Guite was setting up the Ottawa office of St. Joseph's Printing as part of a federal exchange program giving bureaucrats work experience in the private sector. His wife went there to work with him, as office secretary. St. Joseph's, a recipient of federal printing contracts, would later buy the Queen's Printer when the Liberals privatized it in 1997.

Mr. Guite, who continued to be paid by the federal government while at St. Joseph's, stayed just three or four months. His wife was paid by the company, whose president, Frank Gagliano, said St. Joseph's decided against setting up shop in Ottawa at that time and cancelled the exchange.

"We saw that we didn't have a need and it wasn't a program that made any sense for us," said Mr. Gagliano, who is not related to the former public works minister. "So we terminated the program."

Mr. Gagliano said he got to know Mr. Guite quite well while competing for government contracts.

"I never had any experience with him relevant to what he is being accused of today," he said. "This is all a big surprise to me."

Part of the money spent on sponsorship by the Liberals went to Canada's NHL teams, including the Ottawa Senators, whose former marketing director, Enrico Valente, approached Mr. Guite to begin a process that would eventually lead to the familiar federal brand -- the word Canada with a maple leaf over the final 'a' -- appearing at the Corel Centre. Mr. Valente, who now runs his own consultancy business, said he was impressed by Mr. Guite.

"I went to Mr Guite to seek opportunities for the Senators," said Mr. Valente. "He was well respected in the communications community and worked at high levels, which takes some skill. He was very professional."

Mr. Valente was also at Mr. Guite's retirement party.

"There were a lot of good speeches with people applauding him for his efforts," recalled Mr. Valente. "There was very little for them to gain because he was retiring."

The businessman who also attended the retirement party, and who grew to like Mr. Guite as he began to know him well during the post-1995 referendum period, predicts that when Mr. Guite appears before the public accounts committee, he will continue to insist he did what he did to save Canada.

"In his own mind," said the businessman, "I think if he felt if it was right for Canada then the ends justified the means -- even though his means and methods were not quite kosher, he felt that what he was doing was right. The system was too slow so he took it upon himself. I think he will pay for that because it's a dangerous philosophy. It's like taking the law into his own hands."