This is eerily similar to our situation - and proof positive that corruption loves monopolies, governments and lazy regulators.

Thanks to reader AC for the tip.

http://www.theglobeandmail.com/news/national/charbonneau-inquiry-report/article27451569/

Quebec corruption report flags ‘culture of impunity’ in construction industry

A painful chapter in Quebec’s history has concluded with the release of a detailed report on how corruption infiltrated every corner of the province’s multibillion-dollar public construction industry and seeped from the biker gangs and the mafia into bureaucracy and politics.

Justice France Charbonneau and co-commissioner Renaud Lachance issued their long-awaited report on Tuesday with a 60-recommendation blueprint to finish cleaning up the system. The next chapter in the book on corruption in the province will be written by Premier Philippe Couillard, who promised to act quickly to examine and adopt some of the findings.

“The revelations showed our society went to sleep, our vigilance was dropped,” Mr. Couillard said after the report was released. “We were sitting on the fact we had laws more advanced than elsewhere, which was true, but we can see there was need to tighten the rules. This process started a few years ago, it’s ongoing, and will continue.”

The Liberal government under Jean Charest called the inquiry in 2011, after resisting repeated demands from the opposition for one. News reports over the years had exposed a system in which public officials accepted gifts from entrepreneurs and engineers in the construction industry and a handful of firms divided up public contracts among themselves. Many of those companies were also linked to political donations at the municipal and provincial level.

The $45-million inquiry lasted for 263 days of hearings and heard from 300 witnesses. Nearly two-thirds of the 60 recommendations would tighten rules for tendering public contracts, including the establishment of a new government body to oversee the process.

Witnesses testified at the hearings that organized crime figures and construction and engineering firms gave public officials lavish gifts – Montreal Canadiens hockey tickets, Caribbean trips, home renovations, yacht sojourns. The report recommended an explicit ban on such gifts for all public servants, elected officials and their political staffers.

A dozen recommendations seek to separate political lobbying and donations from the awarding of contracts, including a ban on political staff in government soliciting political donations. Other recommendations are whistleblower protection and extending the power of the ethics commissioner to oversee cities and other public organizations.

Justice Charbonneau said “a culture of impunity” took over a vast section of Quebec’s public tendering in construction in which organized crime, political figures and bureaucrats, political parties, unions and entrepreneurs worked together to skim public funds to illicit ends.

“This inquiry showed there was a real problem in Quebec, and it was a lot more vast and entrenched than we realized,” Justice Charbonneau said.

While the report summarized the evidence of alleged misdeeds by some key figures now facing criminal trials, such as former construction magnate Tony Accurso and the former head of Montreal’s executive committee Frank Zampino, Justice Charbonneau did not say who the leaders were.

The report produced an unusual note of discord between Justice Charbonneau and Mr. Lachance, who failed to agree how high the rot rose into the province’s political hierarchy.

Justice Charbonneau found construction bosses broke rules to funnel millions to political parties – especially the Quebec Liberals, who have ruled the province much of the past 12 years – in an implicit exchange for construction contracts.

Justice Charbonneau said in the report the provincial parties and businesses “bypassed electoral law on a large scale,” including getting around a ban on corporate donations by having employees make contributions and reimbursing them. She said such masked donations were not solicited on individual contracts but for “an ensemble of contracts obtained.” She said the link is indirect, but evidence showed companies that received many contracts would be solicited for funds.

Mr. Lachance said he could not reach that conclusion. “Did a donation to a provincial political party allow a business to get a contract? Every business head who testified at the inquiry, including those who were very co-operative and made other serious admissions at the inquiry, answered ‘No’ to that question, whether it was the Parti Québécois or the Quebec Liberal Party in power,” he wrote in the report.

The disagreement highlighted the different backgrounds of the two commissioners. Mr. Lachance, an accountant, needed more direct evidence. Justice Charbonneau, the former prosecutor who built a successful case against biker boss Maurice “Mom” Boucher using a mass of circumstantial evidence, was more prepared to draw inferences.

They did agree on a dozen recommendations to reform political financing, including improved reporting on party finances and the disclosure of the employers of donors.

Amir Khadir of the left-wing Québec Solidaire party said the report let the Liberals off the hook, and party officials would be “popping champagne corks.”

Unions, construction and engineering firms and municipal and provincial governments and political parties of many stripes lined up Tuesday to say they have changed procedures to keep an eye on ethics.

Liberal and PQ governments have instituted anti-corruption measures in recent years, reducing annual political contribution limits to $100 per person, forcing companies bidding on big contracts to get ethics certification from the provincial securities regulator, establishing an anti-corruption inspector-general in Montreal, and making permanent an anti-corruption provincial police squad.

Parti Québécois critic Bernard Drainville accused the Liberal government of cutting resources for the prosecutors’ office that is dedicated to fighting corruption. “They’ve yet to show they are really determined to fight corruption,” Mr. Drainville said.

ENDS

Carmen Lawrence's Labor Government stopped a tender process and awarded the Dawesville Channel contract - $60M if you don't mind Commissioner - directly to Thiess.   The head of the union covering the site received a $300K corrupt payment from Thiess.

The Premier Lawrence believed the head of the union Wilson had the power to destroy her career.

Some months after the contract award, Wilson as head of the AWU  (which recorded a $700K deficit in its financial performance that year, was heavily  in debt and without access to funding from its national parent was trading while insolvent) made a then record political donation of more than $100,000 to Premier Lawrence's campaign.   The money came from the union's accounts, not the slush fund.

And our Trade Union Royal Commission thinks that examining that matter would amount to embarking on a fishing expedition.

Justice Charbonneau found construction bosses broke rules to funnel millions to political parties – especially the Quebec Liberals, who have ruled the province much of the past 12 years – in an implicit exchange for construction contracts.

Justice Charbonneau said in the report the provincial parties and businesses “bypassed electoral law on a large scale,” including getting around a ban on corporate donations by having employees make contributions and reimbursing them. She said such masked donations were not solicited on individual contracts but for “an ensemble of contracts obtained.” She said the link is indirect, but evidence showed companies that received many contracts would be solicited for funds.

Mr. Lachance said he could not reach that conclusion. “Did a donation to a provincial political party allow a business to get a contract? Every business head who testified at the inquiry, including those who were very co-operative and made other serious admissions at the inquiry, answered ‘No’ to that question, whether it was the Parti Québécois or the Quebec Liberal Party in power,” he wrote in the report.

The disagreement highlighted the different backgrounds of the two commissioners. Mr. Lachance, an accountant, needed more direct evidence. Justice Charbonneau, the former prosecutor who built a successful case against biker boss Maurice “Mom” Boucher using a mass of circumstantial evidence, was more prepared to draw inferences.