OTTAWA — If Mike Duffy was ever unclear on senate rules, he didn’t sound like it on the witness stand in his second day of testimony.
The embattled senator told the court that senior Conservatives, including one of its senate leaders, “instructed” him to file housing and daily meal expense claims to avoid creating “controversy” about other senators’ practices and his own constitutional eligibility for his PEI seat.
Testifying in his own defence, Duffy denied any wrongdoing, bad faith or misunderstanding of vague rules.
Quite the opposite.
He said he was clearly told the longtime practice and rules “required” him to file those expenses.
The housing and travel claims totalled $80,000 over six years for his longtime Kanata home, claims he began to file almost immediately, even for travel before he was formally sworn in as a PEI senator.
Duffy said he was told that his appointment, as reflected in the language on senate forms, meant his only PEI residence, a cottage, was now his “primary residence.”
Duffy said he raised concerns with PMO and Conservative senate leadership officials because, two days after his appointment was announced, a PEI professor flagged to a Charlottetown newspaper Duffy was ineligible to sit as a PEI senator because he wasn’t a resident of the province.
Duffy testified he went to Sen. David Tkachuk, the Conservative “guru” who was then vice-chair of the senate’s rules-making committee on internal economy, budgets and administration, who told him to ignore the naysayers.
“He says ‘it’s just politics.’ He said ‘you became a resident of prince Edward Island on your appointment.’ He said ‘you own property there?’ I said, ‘yes.’ He said ‘you have a house there?’ I said ‘yes, it’s being winterized.’
“He said ‘but do you pay taxes there, on your house there?’ Yes. ‘You pay insurance?’ Yes. ‘You pay lights?’ Yes. ‘You pay for hydro, or propane, or heating oil, whatever?’ Yes. ‘You pay for insurance, and you do the same thing in Ottawa?’ And I said yes. And he said ‘you’ve got two houses. So the housing allowance is to defray part of the cost of your second home. There’s no reason for you to be penalized . . . for having two homes.’
“So he says it’s very important that you claim all the claims and allowances because, if you don’t, if you create any light between you and any other senator who’s on travel status when they’re in Ottawa but most particularly any Prince Edward Island senator, the professor will come back and say ‘see he is different, he’s not really from here.’ So he said ‘it is essential that you claim everything that you are entitled to. It’s all within the rules, and you are expected to do that.’
“I said ‘even when I don’t really believe in per diems — because you’ve gotta eat somewhere?’“
“He said ‘you must claim the per diems and you must claim the housing allowance, because to not do so could create controversy about whether or not you are truly a Prince Edward Island senator, a resident of PEI, you’re constitutionally qualified. You must do this.”
Duffy said it was the same message he was given by Harper when he first discussed the possibility with him, saying Harper told him an appointment would simply “speed up” Duffy’s plans to retire from CTV and reside in PEI, except now he would continue to work in the senate for PEI.
Duffy said the message was reinforced by senior senate administrative officials who never questioned his housing or travel claims despite Duffy’s “open and transparent” indications to them that he’d owned his Ottawa area house for several years prior to appointment, or that his PEI home was a “cottage.”
Duffy said it was the senate clerk Paul Belisle who told Duffy he was entitled to claim a free “orientation” trip back to PEI in December 2008 even before his appointment became official.
Duffy’s lawyer Don Bayne continued to lead Duffy through a series of denials that he ever profited personally from senate resources, or directed any senate funds to the Conservative party.
“Not a penny. I have never broken the rules, let alone the law. I never received a penny from anyone ever.”
Although the impact of Duffy’s testimony has less political fallout for the now-defeated Conservative party, the senator nevertheless took the chance to discredit some of his former colleagues. He took another swipe at Harper and his “shadow,” aide Ray Novak.
Duffy said Harper never wrote anything down on cabinet documents, or directly emailed instructions to people, “for deniability,” but he directed Novak how he wanted things done.
Duffy said he checked in weekly with Novak at caucus meetings to let him know the kind of partisan travel and work he was doing to broaden the Conservative voting base boost Harper’s “quest for a majority” in 2011. Duffy said Novak spoke for the prime minister, and he assumed when he updated Novak, he was similarly updating Harper himself.
Duffy said the party’s view, and Tkachuk’s expressed view, was that partisan work was senate business and “good for democracy, the clash of ideas.”
Duffy was dismissive of his critics at the senate and who appeared as Crown witnesses at the trial, saying none could show his yearly designations of his primary residence in PEI were wrong.
“They’re all 100 per cent valid. They’re all 100 per cent within the rules. No one, no one, has taken the stand to say I didn’t fall within the rules.”
Duffy said Harper’s own former press secretary and longtime Ottawa resident Carolyn Stewart-Olsen was named to the senate for New Brunswick, and claimed “the same allowances I did” for living in Ottawa “for a couple of years” while she fixed up a New Brunswick residence, only to later sit in judgment of Duffy.
Duffy denied ever gaining personally from $65,000 in senate funds directed to his friend Gerald Donohue’s family companies to pay for various services he sub-contracted at Duffy’s request.
And, with Bayne outlining his finances, Duffy tried to rebut an analysis done by a Crown witness and forensic accountant Mark Grenon, who had suggested there were deposits unaccounted for in Duffy’s bank account.
Duffy said he and his wife regularly transferred money between them, but all the money was accounted for.
He said he and his wife received inheritances of $162,000 that were not taxable, nor reportable, on their income tax forms.
“This is the mystery cash,” Duffy said sarcastically.
All other pension or employment income his wife had was reported, he said.