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Canadian News Aug 10, 2021 2:11 PM EST

We Charity 'won confidential contracts' before major scandal, says investigation

Investigators reviewed six contracts totalling $131,710 awarded to We Charity over three years.

We Charity 'won confidential contracts' before major scandal, says investigation
Alex Anas Ahmed Calgary, AB

We Charity won a string of sweetheart contracts before the cabinet’s 2020 approval of a $43.5 million pandemic grant that prompted a public uproar, records show. A year-long investigation by the Procurement Ombudsman on Monday revealed departments typically called We Charity with confidential contract offers, then worked out the price later, reported Blacklock's.

"Contacting a prospective supplier, sharing information about an upcoming requirement with that supplier and requesting pricing information from that supplier before establishing and documenting the estimated cost of a contract represents a threat to the fairness of the procurement process and should not be repeated," wrote Ombudsman Alexander Jeglic.

"In this situation, not all prospective suppliers would be treated equally," wrote Jeglic in a report Procurement Practice Review Of Non-Competitive Contracts Involving We Charity. "The supplier that was previously contacted for pricing information would have an unfair advantage over other potential suppliers because it received information about the requirement before anyone else."

Investigators reviewed six contracts totalling $131,710 awarded to We Charity over three years. One, a $17,050 contract from the Leaders' Debates Commission, was awarded though We Charity co-founder Craig Kielburger was on the Commission board at the time. "It appeared the estimated cost of $17,050 including tax was established after We Charity had been contacted," wrote Ombudsman Jeglic.

"Certain issues regarding fairness were identified," wrote Jeglic. None of the six contracts "clearly showed the estimated cost had been established before the department contacted We Charity about its requirement." Other awards included:

• $11,300 from the Canada School of Public Service with costs "established after the quote was received from We Charity."

• $13,374 from the Department of Foreign Affairs with costs fixed "after We Charity had been contacted."

• $24,996 from the Privy Council Office, a figure $4 below the threshold mandating open bids.

• $24,990 from the Public Health Agency, just $10 below the threshold mandating open bids.

All the contracts were for "speakers' services," "facilitation services," or commemoration of events like United Nations’ Child Day observances.

In one case, a contract budgeted at $35,398 plus tax, a total of $40,000 from the foreign affairs department, was repeatedly rewritten to satisfy the supplier. "We Charity had originally proposed a price that exceeded the $40,000," wrote Ombudsman Jeglic. "However, following a discussion with the department, We Charity removed a proposed activity and submitted a new proposal with the price reduced to $40,000."

"Documentation provided to the department did not indicate why the department requested this change," said the report. The favour was a "manipulation" of Government Contracts Regulations, it said.

We Charity subsequently submitted an invoice for $40,000 without GST, claiming "it does not charge tax due to its status as a charity," wrote Ombudsman Jeglic. The department again rewrote the terms of the contract to pay We Charity $40,000 without tax.

"This means the total amount of the contract remained $40,000, and the value attributed to the work or service component of the contract increased by $4,602," said Jeglic. "However, there was no indication of a change in the scope of work provided to justify the increase from $35,398 to $40,000."

Complaints from three unidentified MPs prompted the investigation, said the Ombudsman. Complaints were received July 2, 2020, just one day before the cabinet cancelled a $43.5 million grant on disclosures. We Charity hired then-Finance Minister Bill Morneau’s daughter out of college, covered $41,366 in expenses to host Morneau’s family at resorts in Kenya and Ecuador, and paid members of the Prime Minister’s family $481,751 in fees, gifts and free trips to London and New York.

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