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Duffy trial: Wright testifies he often covered PMO expenses personally

Nigel Wrght, former chief of staff to Prime Minister Stephen Harper, makes his way through a crush of media as he arrives to testify at the criminal trial of embattled senator Mike Duffy in Ottawa on Aug. 12, 2015

Dave Chan/The Globe and Mail

Nigel Wright, former chief of staff to Stephen Harper, told an Ottawa court he regularly paid work expenses at the Prime Minister's Office out of his own pocket – amounts that totalled "tens and tens of thousands of dollars" – as he testified it was no huge leap for him to pay Senator Mike Duffy's controversial $90,172.24 tab.

The most eagerly awaited witness in the Duffy fraud trial was finally in court Wednesday, recounting how he and the PMO were drawn into the Senate scandal over expense claims.

Mr. Wright said he never claimed travel expenses during his nearly 2-1/2 years as PMO chief of staff and also covered employee lunches, ministers' chief-of-staff functions and going-away parties by himself – opting against seeking reimbursement for any of this.

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"It amounted to tens and tens of thousands of dollars," he told the court. "The $90,000 would have been the single largest … of those items but other things that I was entitled to but didn't claim were [cumulatively] well in excess of that," Mr. Wright said. "Meaningfully in excess," he added.

"I had sort of a bit of a pattern paying for things that way, so I just felt I would do it," he said of Mr. Duffy's bill.

Mr. Wright, 52, now back at private equity giant Onex Corp., quit the Harper PMO in May, 2013, after it was revealed that he secretly paid Mr. Duffy the $90,000 so the senator could reimburse taxpayers for questionable expense claims.

The wealthy businessman, whose job includes billion-dollar takeovers, has returned from London to testify on behalf of the Crown, although he will also face a grilling by Mr. Duffy's lawyer.

Mr. Wright detailed in his own words how the scandal engulfed the PMO, with the Conservatives in early 2013 cobbling together a plan – the "scenario for repayment" that was intended to quash the scandal.

That would leave Mr. Duffy only at fault for making a mistake on his expenses.

His testimony offered a glimpse into how the Harper PMO tried to dispel a budding crisis through stage management.

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Mr. Wright acknowledged he had not thought through his plan to make the problem go away.

"If it became public, I thought it would be somewhat embarrassing," he said. "But there were a whole lot of connotations associated with it that I didn't really think through. If I had, I might not have done it."

The plan fell apart in the weeks that followed, forcing Mr. Wright to quit the PMO and leaving Mr. Duffy suspended and facing charges.

As the RCMP first detailed in court filings last year, Mr. Wright explained how the Conservative Party originally planned to quietly reimburse Mr. Duffy's expenses itself, when it believed the amount owing was only $32,000. But fundraising chief Irving Gerstein balked at covering the bill as it climbed to $80,000 and then $90,000.

Mr. Wright insisted he did not tell the Prime Minister of this party plan to cover Mr. Duffy's tab – or his ultimate decision to pay it himself.

Mr. Duffy, a Harper appointee to the Senate, faces 31 charges including fraud, breach of trust and bribery and has pleaded not guilty. This includes claiming living expenses for residing in Ottawa while representing Prince Edward Island. The senator in fact lived in the Ottawa area.

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Mr. Wright explained that Conservatives were sensitive to spending controversies such as expense claims because they felt these were especially injurious to their brand.

He said the $90,000 was no great burden for him.

"The amount was certainly significant for me, but it would not have any noticeable impact on my net worth or my ability to live my life the way I wanted to live it."

Onex's executives are among the most highly paid in Canada. For instance, in 2013, CEO Gerald Schwartz was paid $129-million, and three other executives who held similar ranks to Mr. Wright were paid roughly $20-million apiece.

Things unravelled as the bill facing Mr. Duffy grew.

Mr. Wright learned that in fact the tally of questionable expenses had climbed to $80,000. Mr. Duffy had also been claiming per diem travel expenses for residing in Ottawa – where he had lived for a long time – and this had more than doubled the amount to be repaid.

He recounted that he was "beyond furious" at the news. "I felt this was an outrage on the taxpayer and had to be made whole," Mr. Wright told the court. "It was qualitatively different for me to learn that per diems are being charged for the time spent in the Kanata home."

At the same time, the Conservative Party balked at paying the higher amount.

Mr. Wright said he quickly decided to solve the problem by covering it himself, arguing that he felt an obligation to the PEI senator after assuring him his bills would be covered. He acknowledged it was a decision he would "live to regret."

"I had an undertaking I had made to Senator Duffy. He had acted on that undertaking. I felt exposed to him. So when Senator [Irving] Gerstein said the fund wouldn't pay, I determined I would pay."

The relationship between Mr. Harper's chief of staff and Mr. Duffy frayed as Mr. Wright grew frustrated with what he saw as the senator's recalcitrance and twisting of the facts.

"I said 'Mike, I didn't say that. If you continue to misquote me then we will be speaking only through lawyers going forward,' " Mr. Wright said in court, reading from an e-mail.

Mr. Duffy is charged with bribery for accepting the money, but authorities did not charge Mr. Wright. The RCMP dropped their criminal investigation into the former Harper staffer 16 months ago.

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About the Author
Parliamentary reporter

Steven Chase has covered federal politics in Ottawa for The Globe since mid-2001, arriving there a few months before 9/11. He previously worked in the paper's Vancouver and Calgary bureaus. Prior to that, he reported on Alberta politics for the Calgary Herald and the Calgary Sun, and on national issues for Alberta Report. More

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