The Stel Salaried
Pensioners Organization wishes to thank The Hamilton Spectator for permission
to post the following article by Reporter Fred Vallance-Jones in the February 27,
2004 edition
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Feb. 27, 2004. 12:40 AM |
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Stelco's Legal Team Funded Martin |
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McCarthy Tetrault contributed $178,000 to PM's
leadership bid |
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By Fred Vallance-Jones |
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The law firm that represents Stelco in its bankruptcy protection case was
the second-largest contributor to Prime Minister Paul Martin's Liberal
leadership campaign. McCarthy Tetrault supported Martin to the tune of $178,000, according to
disclosures filed with the federal ethics counsellor Harold Wilson and posted
on Wilson's website. The firm also gave $21,500 to former finance minister
John Manley, who later withdrew from the race. A large portion of the firm's support to Martin was to pay the salary of
Tim Murphy, a former partner at McCarthy Tetrault who acted as Martin's chief
of staff during the leadership race, and now serves as chief of staff in the
prime minister's office. The money, and Murphy's prominent position in government, is just the
latest of a series of apparent ties between Stelco, its representatives and
the prime minister's closest confidants. The connections are raising questions for some, but the man who advises
the government on ethical issues says any conflicts are hypothetical. Stelco
says it wouldn't take advantage of such ties. Besides Murphy, others who have been connected to both Stelco or its
representatives and the prime minister's office include: * Peter Nicholson, who left Stelco's board of directors in December to
lead Martin's transition team and continues to provide strategic policy
advice in the PMO. * John Duffy, a longtime Martin confidant and adviser who is now part of
the team at StrategyCorp, which has registered as a Stelco lobbyist both in
Ottawa and at Queen's Park. * Martin himself, because of his family's ownership of Canada Steamship
Lines, which hauls iron ore for Stelco and is one of the tottering steel
giant's creditors. All of this is significant in light of recent comments from Minister of
National Revenue Stan Keyes, Hamilton West MP and Martin insider, that
Martin's connection with CSL has already disqualified the prime minister from
discussing Stelco issues at the cabinet table. Wayne Fraser, district director of the United Steelworkers union, said he
has no intention of questioning the personal integrity of any of the people
involved. But he said there is no doubt many of the political and legal
players are closely connected. "We know it is a very tight circle and this whole process isn't
friendly to unions and to our members and our retirees so we have to use the
leverage we have to defend our rights." The union is lobbying provincial ministers, trying to persuade them that
bankruptcy judge James Farley is illegally overriding provincial labour law. Aside from Duffy's work with StrategyCorp ,there is no evidence that any
of the people involved, Murphy, Nicholson or Martin, are actually playing a
role in the Stelco issue. Stelco CEO Courtney Pratt said yesterday that, while it is possible people
might perceive Stelco has a series of ins with Ottawa, "we haven't tried
to use that and we don't intend to use that." Nonetheless, Ottawa-based public interest group Democracy Watch says the
potential connections raise a red flag. "You've got a company that is
desperate for support from the federal government," said Aaron Freeman,
a board member. "You've got various lines into the PMO." The company has said repeatedly it considers both Ottawa and Queen's Park
to be stakeholders in its restructuring. Pratt said it's too early to know
what the company might ask for, because talks have yet to take place with
other key stakeholders, including the union. "I would imagine we will (approach Ottawa and Queen's Park) but
exactly what we're going to be asking them to do, that really is up for grabs
right now." Pratt said possibilities for government involvement include assistance
with pensions, loan guarantees, help with worker training or even joint
construction of an electricity co-generator. Pratt sees the various apparent ties to the government as independent and
unrelated. For example, he said Nicholson was a Stelco director for six years and resigned
when he moved to the PMO. "That's kind of a connection that
evolved." Nicholson has already said he would not participate in any
discussions about the steel company's fate. Pratt said he wasn't aware of Murphy's former status in the law firm and said
McCarthy Tetrault is acting as legal counsel for Stelco, not making
representations to government. The firm has represented the steelmaker for
years. Murphy himself said through a PMO spokesperson that his former role at
McCarthy Tetrault is not an issue because he didn't do work for Stelco while
at the firm. As for Duffy, Pratt said Stelco chose to hire StrategyCorp because of its
experience providing advice on how to deal with government, a decision
"certainly not related to his role in the prime minister's office." Pratt said any actual communication with government will be done by
Stelco, not by StrategyCorp. Concerns have been expressed, including by the federal Conservatives and
Hamilton East MP Sheila Copps, that the high-profile connections between
Martin and Stelco could prevent the steel company's woes from being
considered at the highest levels. But Pratt believes the company will get a full hearing nonetheless, even
if Martin has to personally withdraw from the discussions. Ethics counsellor Harold Wilson said Murphy did not handle the Stelco file
and is no longer associated with McCarthy Tetrault, so there is no potential
conflict there. As for Nicholson and the prime minister, he maintains that until Stelco
makes a request of the government, any conflict is hypothetical. fvallance-jones@thespec.com 905-526-2499. |