Focus of Mulroney-Schreiber inquiry should be narrow: report

An independent adviser is urging the government to hold a limited inquiry into the Mulroney-Schreiber affair, one that could include closed-door hearings.

David Johnston, the president of the University of Waterloo, released his suggestions in a report tabled Monday in the House of Commons. The Conservative government said it will heed Johnston's advice.

"The government will be acting on it shortly," House Leader Peter Van Loan said as he presented Johnston's report to MPs.

"As we indicated from the start, it was our intentions to follow professor Johnston's recommendations as an independent third party, and we intend to do that," he added minutes later, answering questions from reporters outside the House.

Prime Minister Stephen Harper asked Johnston in November to advise the Conservative government on what shape a public inquiry into the Mulroney-Schreiber affair should take.

Johnston released an interim report into the matter in January, suggesting that any inquiry held should be narrow in scope, focusing on the cash payments businessman Karlheinz Schreiber paid former prime minister Brian Mulroney in the early 1990s.

Mulroney issued a statement Monday saying he is ready to co-operate with the inquiry, but he noted if it uncovers any allegations of criminal wrongdoing, that these should be investigated by prosecutors and by the RCMP.

"If there are grounds for criminal charges, they should be laid," the statement said. "If no grounds for criminal charges are found, Schreiber should be sent to Germany."

Schreiber is facing extradition to Germany, where he is wanted on charges of fraud, tax evasion and bribery.

Possibility of private interviews

In his latest report, Johnston wrote that his opinion has not changed from his interim report, although he noted for the first time that the person chosen to lead the inquiry could hold some of the proceedings in private.

Such a measure would help ensure that the investigation is cost-effective and timely, and does not simply become "a circus of lawyers," Johnston argued.

"The commissioner should explore opportunities to conduct portions of the investigation and inquiry in a more efficient manner than the court-like 'traditional' Canadian public inquiry procedure would permit," Johnston wrote in his report.

He noted that other inquiries have broken from traditional formats. The inquiry that probed the SARS health crisis of 2003 included confidential interviews, while the one that probed the 1985 Air India bombing allowed participants to submit written statements of evidence, Johnston said.

"I appreciate that, if the public interest warrants an inquiry, there are aspects … that should be fully ventilated in a public proceeding," Johnston said.

"However, there would also inevitably be subsidiary matters, and matters of context, that could be as effectively and more efficiently explored through alternate means."

Johnston report differs from ethics findings

Johnston's report differs from the conclusions of the House of Commons ethics committee, which launched a probe into the Mulroney-Schreiber affair late last year and concluded that an inquiry should be wide-ranging, probing the lengthy business relationship between the two men.

He considered the ethics committee findings and hearings, but Johnston has determined that the committee provided "no rationale" for its demand for a broad inquiry, except to say that the inquiry should be broad because the hearings will be so politically charged.

Johnston argued that the public is not interested in rehashing aspects of the Mulroney-Schreiber relationship that have already been probed in past RCMP investigations and court proceedings.

He noted that an inquiry could take into account testimony and information revealed during the ethics committee hearings.

Ethics committee chair Paul Szabo said he's "quite pleased" with the report.

He said it's efficient and productive that the commissioner is being given a variety of ways to handle the inquiry, with the option of conducting private interviews for subsidiary matters.

"Once that evidence gets on the table, I'm confident that the appointed commissioner has the tools, including subpoena powers, to be able follow the evidence and follow the money."

But NDP MP Joe Comartin said he wished the report had called for a broad inquiry, like the ethics committee suggested.

"I wasn't surprised but I was still disappointed by the report," said Comartin.

Inquiry could cost millions

The CBC's Rosemary Barton, reporting from Parliament Hill, said there is now little doubt the inquiry will happen, considering the Conservatives are saying they are ready to follow Johnston's advice.

"The prime minister has committed to doing this, and we would well expect that he would accept the recommendations we're going to hear," Barton said.

She said Mulroney will now have to prepare to testify again. He refused to provide more than one day of testimony to the ethics committee, but he won't legally have the option of denying requests to testify before the inquiry.

Barton said whatever scope the inquiry ultimately takes, it will be months before it is set up.

"It takes an awful long time to get a public inquiry up and running," she said.

"If there was something like an election in the meantime, that obviously could throw this all off. It could take months and millions and millions of dollars to get this moving."

Mulroney says money paid after leaving office

Mulroney has told the ethics committee that he received money between 1993 and 1994 to lobby internationally on behalf of Schreiber's client, Thyssen, a German armoured-vehicle company.

Mulroney said he was paid $225,000 cash in envelopes at three meetings between the two men, and insists the business arrangement was struck after he left office in June 1993.

While saying that accepting cash payments was one of the biggest mistakes of his life, Mulroney has said he did nothing illegal.

But Schreiber has testified that the total was $300,000, and that the arrangement was reached while Mulroney was serving his last days as prime minister in 1993, something that could have put him in violation of federal ethics rules.

Johnston said lawyers for both Mulroney and Schreiber provided him with ideas for what shape the inquiry should take.

Schreiber's lawyers told Johnston the inquiry should pose a series of questions, while Mulroney's lawyers argued the inquiry shouldn't be held at all.

Johnston noted it was not in his mandate to determine whether or not an inquiry should be held. He was only to decide what parameters it should have.