Smith Commission of Inquiry

Daily Transcripts

Public Hearings - May 3, 2000



     1                       UNEDITED REALTIME VERSION
     2                                 VANCOUVER, B.C.
     3                                 3 MAY, 2000
     4                  (PROCEEDINGS RESUMED 10:00 A.M.)
     5     THE REGISTRAR: All rise. The Smith of inquiry is now in 
     6                  session.  Commissioner Murray L. Smith presiding. 
     7     MS. SMITH:  For the record Mr. Radnoff, Mr. Leask, Mr. Bethell 
     8                  and Mr. Lewis are counsel and the commission's 
     9                  next witness is Mr. David Barrett.
    10     THE COMMISSIONER:  Welcome Mr. Leask.
    11     THE REGISTRAR: Stand and take the Bible please. 
    12                                 (DAVID BARRETT, SWORN)
    13     THE REGISTRAR:  Please state your name.
    14              A   David Barrett.
    15     THE REGISTRAR: Thank you.
    16     MS. SMITH: 
    17              Q   Mr. Barrett most people will recognize you as a 
    18                  former premier of this province.  When were you 
    19                  premier?
    20              A   From September 1972 until December 1975.
    21              Q   And that was in a government formed by the new 
    22                  Democratic party of British Columbia; is that 
    23                  correct?
    24              A   That's correct.
    25              Q   When did you become a member of the NDP?
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     1              A   I joined the new Democratic party I think it was 
     2                  1958 or '59.
     3              Q   And you were first elected as an MLA when?
     4              A   1960.
     5              Q   And my understanding is you became party leader 
     6                  in 1969; is that correct?
     7              A   I became the house leader in 1969, party leader 
     8                  in 1970.
     9              Q   Now, in the government from '72 to '75 Mr. David 
    10                  Stupich was Minister of Finance for you; is that 
    11                  right?
    12              A   Minister of agriculture and later Minister of 
    13                  Finance it was the last three or four months.
    14              Q   Why did you choose Mr. Stupich to be your 
    15                  minister of finance?
    16              A   It was a cabinet shuffle and Mr. Stupich was a 
    17                  chartered accountant and also had a bachelor's 
    18                  degree in agriculture, it was a natural choice 
    19                  after his previous assignment.
    20              Q   How long have you known Mr. Stupich for?
    21              A   I would say I met Mr. Stupich first in 1959.
    22              Q   And my understanding you were roommates together 
    23                  in Victoria when first MLAs?
    24              A   That's right, and with another group of MLAs as 
    25                  well I was a roommate of Mr. Stupich's and others 
 0002

     1                  over a period of time.  To cut expenses.
     2              Q   In the context of these hearings a letter was or 
     3                  a portion of a letter was read out attributed to 
     4                  you and I'm just going to read the quotes and if 
     5                  you can identify it. 
     6              A   Sure.
     7              Q   The question occurred on the 9th of March 2000 
     8                  and it's Mr. Lewis on behalf of the Gaming 
     9                  Commission questioning Mr. Howard and he says 
    10                  that:
    11                       Mr. Barrett gave a letter in support of 
    12                       Mr. Stupich.
    13                  And as I understand that it's in the context of 
    14                  the recent prosecution and sentencing of the man.
    15              A   Yes, I did.
    16              Q   All right.  And the quote says:
    17                       He said as part of that letter he's talking 
    18                       about meeting him in the 1960s, he says 
    19                       we immediately became friends first 
    20                       politically and then personally and have 
    21                       remained so to that date.
    22              A   That's correct.
    23              Q   And then a further quote is:
    24                       David Stupich became a model of service and 
    25                       time energy and concern.  In my own 
 0003

     1                       personal dealings with him I always found 
     2                       him to be a man of his word and willing 
     3                       to go the extra distance to help other.  
     4                       Loyal to his family and friends Dave is 
     5                       still respected by his colleagues and 
     6                       certainly by me in my capacity as leader 
     7                       of the political party.
     8              A   Yes.
     9              Q   You became friends?
    10              A   We became friends, as I did become friends to 
    11                  everybody else who was in the caucus in the 
    12                  party.
    13              Q   And you viewed him as loyal?
    14              A   Yes, I viewed him as loyal.
    15              Q   And he was trusted by you?
    16              A   He was trusted by me.
    17              Q   Now, we have heard from Mr. Bill King, I'm going 
    18                  to go through a little bit of ancient history 
    19                  here to establish your relationship with some of 
    20                  the people that we have heard from or heard of.  
    21                  As I understand it Bill King was the MLA for 
    22                  Revelstoke; is that right?
    23              A   That's correct.
    24              Q   And what portfolio did he hold?
    25              A   Minister of Labour.
 0004

     1              Q   And again how long have you known Mr. King?
     2              A   First met Mr. King in the early '60s on the 
     3                  campaign trail, he was very active in the NDP in 
     4                  Revelstoke at that time.
     5              Q   To your knowledge were he and Mr. Stupich good 
     6                  friends?
     7              A   To my knowledge everybody within the caucus were 
     8                  friends with each other.
     9              Q   Was there any particular that you can point out 
    10                  or special about Mr. Stupich, yourself and Mr. 
    11                  King in relation to the caucus?
    12              A   No, I don't think so.  We all had common goals in 
    13                  terms of a political agenda that we were 
    14                  committed to.
    15              Q   We have seen in the documents a reference to 
    16                  Margaret Hobbs.  As I understand she was from 
    17                  Revelstoke as well; is that right?
    18              A   That's correct.
    19              Q   And who was she?
    20              A   She was the widow of Tiny Hobbs who was the MLA 
    21                  of that area and died rather tragically with a 
    22                  heart attack after an all night session. 
    23              Q   And are you aware of activity between Mrs. Hobbs 
    24                  and Mr. King, do you know whether or not she 
    25                  worked for him or had a connection with him?
 0005

     1              A   I'm not aware of that, but I do know that she was 
     2                  the MLA for a brief time as well.
     3              Q   Before or after Mr. King?
     4              A   Well after her husband died she ran in the 
     5                  by-election and was successful and then she sat 
     6                  briefly and then Mr. King ran.
     7              Q   And then Mr. Harvey Beach he was your --
     8              A   He was my administrative assistant right.
     9              Q   And what does an administrative assistant do?
    10              A   Everything and anything.  Mr. Beach travelled 
    11                  with me, Mr. Beach along with Mrs. Thomas in my 
    12                  office were people responsible for dealing with 
    13                  my itinerary, my travel plans, Mr. Beach also 
    14                  served in the capacity in my office in dealing 
    15                  with people inside the party or outside the party 
    16                  on issues that I wanted him to deal with in a 
    17                  general broad sense of a description of 
    18                  administrative assistant.
    19              Q   All right.  And was Mr. Beach a close friend?
    20              A   Mr. Beach was a very close friend and still is.
    21              Q   Okay.  Was Mr. Stupich aware of the role that Mr. 
    22                  Beach played in your office?
    23              A   Yes, I think everything in the caucus and inside 
    24                  and outside of government who knew Mr. Beach were 
    25                  aware of his role.
 0006

     1              Q   And you referred to Mrs. Thomas is that Joyce 
     2                  Thomas?
     3              A   Yes, that's Joyce Thomas.
     4              Q   Then we heard from Mr. Bob Williams yesterday and 
     5                  he was also a minister in your government; is 
     6                  that correct?
     7              A   That's correct.
     8              Q   And how long have you known him for?
     9              A   I met Mr. Williams after the 1966 election 
    10                  although I knew of him before that.
    11              Q   And then Joe Denofreo was the provincial 
    12                  secretary for a period of time.
    13              A   Yes.
    14              Q   Can you explain the relationship between the 
    15                  leader of the party and the provincial secretary?
    16              A   It's variable.  Mr. Denofreo was secretary for a 
    17                  period of time that I was leader towards the end 
    18                  of the period of time that I was leader.  But I 
    19                  had known Mr. Denofreo personally for years 
    20                  before then.
    21              Q   And again friends?
    22              A   Yes.
    23              Q   I would like to enter as the next exhibit 
    24                  document book 74, please.  And that's the 
    25                  document book that should be before you Mr. 
 0007

     1                  Barrett.
     2              A   Yes.
     3     THE REGISTRAR: Exhibit 222. 
     4                  (Exhibit 222:  Document book 74)
     5     THE COMMISSIONER:  Exhibit 222, thank you.
     6     MS. SMITH: 
     7              Q   If we go to tab one of the exhibit there is a 
     8                  document entitled 31st general election 1975 and 
     9                  under the summary where the votes are the number 
    10                  of votes are set out it appears that the Social 
    11                  Credit party won that election does that accord 
    12                  with your recollection?
    13              A   That's correct.
    14              Q   And if you go to page 3 of that document there 
    15                  are the results by electoral district and the 
    16                  Coquitlam riding is set out at the top of the 
    17                  page and your name appears at the top for the NDP 
    18                  18,663 votes.
    19              A   I'm sorry are you referring to page --
    20              Q   Page 3 of the same tab.
    21              A   I don't have that list here.  Sorry. 
    22              Q   So you lost by just a few votes in that election; 
    23                  is that correct?
    24              A   That's correct.
    25              Q   Now, if you go back at page 1 where there are 
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     1                  various dates set out, dissolution of 
     2                  legislature, issue of writs, polling day is 
     3                  December 11, 1975, return day of writs is January 
     4                  5, 1976 and the legislature opens on the 17th of 
     5                  March.  Looking at those dates when were you 
     6                  effectively out of a job, that is back to page 1 
     7                  of the first tab.
     8              A   I'm sorry. 
     9              Q   Do you see those dates on the first page?
    10              A   Oh, yes okay.
    11              Q   So in reference to those dates can you tell us 
    12                  when you given that you lost the Coquitlam riding 
    13                  when were you out of a job and --
    14              A   Midnight December the 11th. 
    15              Q   And did that mean that your income source 
    16                  stopped?
    17              A   Yes.
    18              Q   You remained the leader of the party 
    19                  notwithstanding that you had lost your seat:  Is 
    20                  that correct?
    21              A   That's correct.
    22              Q   Now, if we go to tab 39 of this document book 
    23                  what we have is a summary of an account that 
    24                  appeared in the books of the Nanaimo Commonwealth 
    25                  Holding Society.  Prior to receiving 
 0009

     1                  documentation in the context of this commission, 
     2                  did you ever have occasion to see books or 
     3                  records associated with the NCHS?
     4              A   No.
     5              Q   With regard to Marwood Services Limited?
     6              A   No.
     7              Q   We'll look at some of the original entries Mr. 
     8                  Stupich's hand but this is sort of a more legible 
     9                  summary prepared by Mr. Allan who was one of Ron 
    10                  Parks assistants.  And it relates to an account 
    11                  number 2094, and the first entry that they could 
    12                  identify in this account indicates a payment to 
    13                  you or sorry a payment to sun by the name of 
    14                  Barrett December 31, 1975 in the amount of $600 
    15                  and there is a series of other entries that we'll 
    16                  discuss in a few minutes.  Did you receive monies 
    17                  from NCHS while you were out of office?
    18              A   Yes, I did.
    19              Q   And you remember we'll just deal with that first 
    20                  amount.
    21              A   I don't remember the first amount.
    22              Q   All right.  Now if we go to the last page, let's 
    23                  go to the first tab again and?
    24      THE COMMISSIONER:  Is this the account that was titled 
    25                  special caucus account?
 0010

     1     MS. SMITH:  It gets called several things eventually it is 
     2                  called special caucus, yes.
     3              A   What number is that? 
     4              Q   Sorry if we can back to the first tab, tab 1 and 
     5                  ask you to turn to the last page and this 
     6                  document is entitled "by-elections 31st 
     7                  parliament."   Are you there?
     8              A   Yes.
     9              Q   And it says Vancouver east which is the one we 
    10                  were concerned with and it says issue of writ 29 
    11                  April 1976, what does that mean, what happens 
    12                  when the writ is issued?
    13              A   The election was called.
    14              Q   And who determines the timing of that?
    15              A   The existing government.
    16              Q   And the second name under election results is 
    17                  your name and you clearly win the by-election 
    18                  with 70 percent of the vote.  When were you back 
    19                  in a job?
    20              A   I think I was sworn in on the 14th of June, here, 
    21                  on this document.
    22              Q   All right.  Under the column where it says date 
    23                  member took seat; is that right?
    24              A   That's right.
    25              Q   And so once you took your seat in June of '76 you 
 0011

     1                  then resumed receiving income as an MLA; is that 
     2                  correct?
     3              A   That's correct.
     4              Q   Now, we know from documents in evidence of other 
     5                  witnesses that the Holding Society was 
     6                  incorporated in 1958 and we know that Mr. Stupich 
     7                  was involved in it from its inception.  When were 
     8                  you first aware of the Nanaimo Commonwealth 
     9                  Holding Society?
    10              A   I can't give a precise date, but certainly by the 
    11                  early '60s.
    12              Q   Okay.  And what did you understand it to be?
    13              A   I understood it to be an instrument of education 
    14                  and research for democratic socialism in British 
    15                  Columbia and it was also an instrument as I 
    16                  understood it for fund raising for projects as 
    17                  well related to its mandate.
    18              Q   Did you ever have occasion to look at its 
    19                  constitution?
    20              A   No.
    21              Q   You understood that it was a non-profit 
    22                  organization; is that right?
    23              A   Yes.
    24              Q   And did you understand it was separate -- you 
    25                  knew that Mr. Stupich was associated with it; is 
 0012

     1                  that right?
     2              A   That's correct.
     3              Q   Separate and apart from Mr. Stupich's 
     4                  involvement, were you aware that it had strong 
     5                  support from the Nanaimo NDP community?
     6              A   I can't say I was aware of strong support.  I 
     7                  knew that it was very active in the Nanaimo 
     8                  community.
     9              Q   All right.  And did you also understand that it 
    10                  played a role with regard to the provincial NDP?
    11              A   Yes, yes.
    12              Q   And what was that role?
    13              A   Well, it over the years it was available as a 
    14                  fund raising area for projects of research or 
    15                  activities related to the furtherance of 
    16                  democratic socialism in British Columbia.
    17              Q   Were you aware that Mr. Stupich was the treasurer 
    18                  of the organization?
    19              A   I knew he was connected but I didn't know exactly 
    20                  what his title was but I knew he was 
    21                  instrumental.
    22              Q   And instrumental with regard to the purse strings 
    23                  of the society is that fair?
    24              A   Yes, yes.
    25              Q   Did you ever deal with anybody other than Mr. 
 0013

     1                  Stupich with regard to monies of the Holding 
     2                  Society?
     3              A   Not that I can recall.
     4              Q   All right.  Let's go to tab 11 which is a 
     5                  photocopy of a ledger sheet from the books and 
     6                  records of the NCHS and this has been identified 
     7                  as being Mr. Stupich's handwriting and you'll see 
     8                  at the top it had been NCHS charities it's been 
     9                  crossed off and then it says NDP special then 
    10                  dash Barrett.
    11              A   I'm sorry I don't have the same page, what page? 
    12              Q   Tab 11, first page.
    13              A   I'm at tab 11, sorry. 
    14              Q   Turn it on its side.
    15              A   Okay.
    16              Q   There is a title up in the top middle of the page 
    17                  wherein charities had been crossed out, NDP 
    18                  special dash Barrett, and then under date in 
    19                  small hand it states 1975 and then the initials 
    20                  DB and then SAL.DB dash 2 HQ.  At some point you 
    21                  became aware that funds were held on behalf of 
    22                  the NDP at the Holding Society; is that right?
    23              A   Yes.
    24              Q   Were you aware of how those funds were treated by 
    25                  Mr. Stupich?
 0014

     1              A   Well, I was aware that Mr. Simpson was a fund 
     2                  raiser for Nanaimo Commonwealth Holding Society 
     3                  and there were people who wished to give money to 
     4                  the party but were worried about repercussions in 
     5                  terms of the atmosphere politically, the 
     6                  government was very rigid in its reaction to any 
     7                  supporters of the New Democratic Party and when 
     8                  Mr. Simpson was a fund raiser there were people 
     9                  who gave him money for the party but for the 
    10                  Nanaimo Commonwealth Holding Society to use the 
    11                  money for research or education for the party.
    12              Q   We're going to come to Mr. Simpson in a few 
    13                  minutes but with regard to the way the monies 
    14                  were actually treated by Mr. Stupich, did you 
    15                  know that there were two accounts?
    16              A   No.
    17              Q   At NCHS?
    18              A   No.
    19              Q   All right.  The document that we're looking at 
    20                  has the $600 amount that we saw at page or sorry 
    21                  tab 39.
    22              A   Yes.
    23              Q   And then underneath there is January 76, B 
    24                  Simpson and there's $17,000 deposit then KH 
    25                  Gibson daily and then DB Harvey Beach $7,000. 
 0015

     1                       Do you recall -- first of all would Mr. 
     2                  Stupich have any reason to give Mr. Beach monies 
     3                  other than for them to be forwarded to you?
     4              A   Well, as I recall Mr. Beach had no longer was 
     5                  employed, Mr. Beach had accumulated expenses 
     6                  related to party activities and activities for 
     7                  the job that he did, and as I recall it he was 
     8                  given $7,000 to cover his accumulated expenses.
     9              Q   And then further on there are again in tiny 
    10                  script numbers which are laid out in easier form 
    11                  to follow in the analysis of the accountants at 
    12                  tab 39 and I'm going to take you there now if 
    13                  you'll turn to tab 39, which is the printed 
    14                  schedule of the information.
    15              A   Tab 39? 
    16              Q   So we see again the 17,000 credit from Mr. 
    17                  Simpson soon?
    18              A   Yes.
    19              Q   7,000 going to Mr. Beach?
    20              A   Right.
    21              Q   And then skipping down four lines we see B 
    22                  Barrett March 8, 1976, $1,986.14 and then another 
    23                  entry on the same date same name $1,333.34.  17 
    24                  days later I'm going to skip over to March the 
    25                  25, '76 there are again two payments and they 
 0016

     1                  total $1,459.74, a month later April 24, '76, 
     2                  another $1,065 in payments two payments, one in 
     3                  the amount of 465, the other in the amount of 600 
     4                  and then a month later May 24 and May 25, '76 
     5                  again $1,065 and the last payment appears to be 
     6                  just one week before you were sworn in and that's 
     7                  June the 7, 1976, where you received $475. 
     8                       Do you recall receiving sort of regular 
     9                  payments from --
    10              A   Yes, my expenses were paid prior to the 
    11                  by-election and once the election -- by election 
    12                  was called expense that is were paid after that 
    13                  were incurred before that date.
    14     THE COMMISSIONER:  The entries including the Receiver General 
    15                  entries on your behalf would suggest that some of 
    16                  the payments were in the nature of salary as 
    17                  opposed to payment of expenses.  Does that assist 
    18                  you in any way?
    19              A   No, not really.  I don't recollect receiving a 
    20                  salary.  Although Mr. Stupich did do my income 
    21                  tax returns and that may be related to that, but 
    22                  the other payments were they were my expenses 
    23                  during the period leading up to the by-election.  
    24                  There was a long period leading to the by 
    25                  election which was very unusual.
 0017

     1      THE COMMISSIONER:  Do you have any recall of why Mr. Stupich 
     2                  on your behalf would have been remitting monies 
     3                  to the Receiver General in the spring of '76?
     4              A   I'm not sure.  I don't recall that, no.
     5     THE COMMISSIONER: Thank you.
     6     MS. SMITH: 
     7              Q   Would did you receive these monies from?
     8              A   From a cheque by Mr. Stupich.
     9              Q   And was the cheque a NCHS cheque?
    10              A   I don't recall but I assume it was.
    11              Q   When did you first become aware of NDP funds 
    12                  available at the Holding Society?
    13              A   I'm not quite sure what you mean by NDP funds 
    14                  available.
    15              Q   All right.  Let's break it down.  When did you 
    16                  first become aware that there were monies 
    17                  available at the Holding Society?
    18              A   In the early '60s.
    19              Q   That could be used for NDP purposes?
    20              A   For research projects or other areas.
    21              Q   Now, as I understand your evidence the expenses 
    22                  incurred by you in anticipation of the by 
    23                  election --
    24              A   That's correct, I was living in Victoria and I 
    25                  travelled frequently to Vancouver prior to the 
 0018

     1                  calling of the by-election.
     2              Q   Would it be fair to say these covered your living 
     3                  expenses?
     4              A   Yes.  I stayed mostly I billeted most of the time 
     5                  with my mother as often as I could and so I 
     6                  minimized the expenses as much as possible.
     7              Q   And how did it come to be that the Holding 
     8                  Society recompensed you for your expenses?
     9              A   I don't recall the discussions around it.  I 
    10                  needed expense money.
    11              Q   Right?
    12              A   And.
    13              Q   Did you know to go to Mr. Stupich for that money?
    14              A   I don't recall exactly how it occurred.
    15              Q   All right. 
    16              A   I want to be precise and I just don't recall.
    17              Q   So you don't remember whether Mr. Stupich offered 
    18                  or whether you approached him; is that right?
    19              A   I'm not sure.
    20              Q   Did you provide receipts to authenticate the 
    21                  expenses?
    22              A   Yes, I did.
    23              Q   And who did you give the receipts to?
    24              A   Mr. Stupich.
    25              Q   And given that you had a view as to what the 
 0019

     1                  purpose of the Holding Society was how did the 
     2                  expenses incurred by you fit into the Holding 
     3                  Society's purposes?
     4              A   Well, certainly I was organizing for the new 
     5                  democratic party in one particular riding during 
     6                  that period of time.
     7              Q   Were you out of a job essentially from February 
     8                  sorry from December '75 until June, so six and a 
     9                  half months?
    10              A   Yes.
    11              Q   All right.  And but for the Holding Society was 
    12                  there any other obvious source of money for you?
    13              A   We had some small savings that we used and my 
    14                  father helped as he always did.
    15              Q   But it was --
    16              A   It was a tough time, yes.
    17              Q   Tough time?
    18              A   Yes.
    19              Q   So recalling that tough time, you've got a young 
    20                  family I think?
    21              A   Yes.
    22              Q   And you are still the leader of the political 
    23                  party, I'm just going to ask you to really draw 
    24                  on your recollection with regard to how get of 
    25                  over that hump came to be.
 0020

     1              A   Well, career-wise my career was cut off 
     2                  professional career was cut off when I was fired 
     3                  by the provincial government from my political 
     4                  activity late from 1957.  From that time on, to 
     5                  earn a living, I had to contract out which was 
     6                  very unusual for my profession for those years 
     7                  for a brief time before I was elected and I had a 
     8                  job with the John Howard society which I got 
     9                  right after the within weeks after I got fired.  
    10                  And that was an easy transition.  But as the 
    11                  process went along from the 1960 until 1969 when 
    12                  I became house leader I could not sustain a job 
    13                  at any agency, I could become a supervisor or a 
    14                  consultant but to actually perform as a 
    15                  supervising social worker and carry cases the 
    16                  nature of the work just did not lend itself to 
    17                  that.  I then was very fortunate in obtaining a 
    18                  number of periodic positions with a number of 
    19                  different agencies.  I had the professional 
    20                  qualifications and there was a shortage of 
    21                  trained social workers.  But it was always living 
    22                  on the edge.  And the indemnity as an MLA was not 
    23                  very much money at all.  When I was first elected 
    24                  it was $3,500 for a whole year, so I have to 
    25                  sustain an income by working while I was an MLA.
 0021

     1              Q   All right.  Just that it's one of those peculiar 
     2                  situations to be out of work but working towards 
     3                  getting back into your job.  It must have been a 
     4                  relief to have a source of funds and given those 
     5                  characteristics, I'm wondering whether the 
     6                  discussion about the situation has assisted you 
     7                  in recalling whether or not that source of relief 
     8                  was identified by Mr. Stupich coming to you or 
     9                  you going to Mr. Stupich?
    10              A   I don't remember how the arrangement was made but 
    11                  it was understood, obviously, anybody who knew my 
    12                  situation knew that I needed some help during 
    13                  that transition period of time.
    14              Q   Who else knew that you were receiving monies from 
    15                  the Holding Society?
    16              A   I'm not sure.  It wasn't a great secret as far as 
    17                  I was concerned. 
    18              Q   And going back a few to things we were discussing 
    19                  a new minutes ago, you had testified that you 
    20                  believed that you learned that there were funds 
    21                  available at the Holding Society sometime in 
    22                  the '60s.
    23              A   Yes.
    24              Q   Do you recall or if you can give us as much 
    25                  information as you can with regard to what you 
 0022

     1                  knew and how you learned it?
     2              A   Well, I was aware that there were people who were 
     3                  donating to the Nanaimo Commonwealth Holding 
     4                  Society who wished to remain anonymous who some 
     5                  of whom were in business or professions who were 
     6                  in the atmosphere that existed at that time it 
     7                  was a very, very strong partisan atmosphere who 
     8                  did not want to be known as supporters of the new 
     9                  dramatic party because it might impinge on their 
    10                  professions or businesses.  It was pretty tough 
    11                  stuff. 
    12              Q   So where did you think that the Holding Society 
    13                  was getting the money to pay you?
    14              A   Well, from donations certainly to the Nanaimo 
    15                  Commonwealth Holding Society, that continued work 
    16                  that it was set out to do.
    17              Q   Did you ascertain whether or not there was 
    18                  director approval with regard to the payments to 
    19                  you?
    20              A   I have no idea.
    21              Q   Did you discuss the payments with anybody?  My 
    22                  understanding is that you visited Nanaimo once in 
    23                  a while; is that right?
    24              A   I don't think I visited Nanaimo any more than I 
    25                  visited other constituency I don't recall 
 0023

     1                  discussing it but it was certainly a matter of 
     2                  fact that I needed the help and I was given the 
     3                  help.  No one ever asked me you know are you 
     4                  getting help from Nanaimo at that time.  Had they 
     5                  I would have said yes.
     6              Q   I was just wondering whether or not you discussed 
     7                  it with any of the other people associated --
     8              A   Not that I recall.
     9              Q   Now, let's deal with Mr. Simpson.  He testified 
    10                  that he had solicited donations for the NDP for a 
    11                  period of years and my understanding is you were 
    12                  aware of his efforts?
    13              A   Yes, I was, yes.
    14              Q   To the best of your recollection when did Mr. 
    15                  Simpson start that process on behalf of the 
    16                  party?
    17              A   Mr. Simpson was involved in fund raising outside 
    18                  of the Nanaimo Commonwealth Holding Society for 
    19                  the party, it is a job that no one in the 
    20                  political party wants to do but everybody wants 
    21                  the rewards from its results.  Every political 
    22                  leader is pressured with raising funds and fund 
    23                  raisers, the word fund raisers are synonymous 
    24                  with political leadership.  Very early on in the 
    25                  party I volunteered to be a fund raiser because 
 0024

     1                  it was the job that no one else really wanted and 
     2                  that is the case today.  And it will always be 
     3                  that case until we have publicly financed 
     4                  elections.  Mr. Simpson and I worked together and 
     5                  we did raise funds and Mr. Simpson turned the 
     6                  fund over to the Nanaimo Commonwealth Holding 
     7                  Society.
     8              Q   Why was that?
     9              A   Because the donors, the money that was turned 
    10                  over to the party people wanted to give to the 
    11                  party, the donors of some of the funds did not 
    12                  want to be publicly associated with the in you 
    13                  democratic party for fearful of revenge in their 
    14                  professions or businesses from the Social Credit.  
    15                  And that was a reality. 
    16              Q   How was it decided that the monies that were 
    17                  donated to the NDP would go to the Holding 
    18                  Society?
    19              A   The donor would make the decision.
    20              Q   But why the hold are society, why not the 
    21                  Broadway society?
    22              A   Well, the Broadway Commonwealth Society could 
    23                  have received the funds too, it was just the one 
    24                  that Mr. Simpson gave money to.
    25              Q   So how was that decided upon?
 0025
 

     1              A   I suppose Mr. Simpson decided it.
     2              Q   So your testimony is you did not direct or 
     3                  arrange for receipt of corporate donations at the 
     4                  Holding Society; is that right?
     5              A   No, I didn't.  I certainly consulted with Mr. 
     6                  Simpson and -- but I understood that he was 
     7                  giving the money to Nanaimo Commonwealth Holding 
     8                  Society.  It was of no particular decision of 
     9                  mine or influence of mine.  It was the donors who 
    10                  were obviously given an option if they were 
    11                  worried about being identified with the new 
    12                  democratic party.
    13     THE COMMISSIONER:  Were you aware of the facility of a society 
    14                  being able to mask or conceal the identity of the 
    15                  donors?  That is their being no transparency in 
    16                  the society therefore the anonymity could be 
    17                  maintained.
    18              A   I don't know how that operated.  I think that -- 
    19                  I didn't think that there would be any necessity 
    20                  for the anonymity of giving to the Nanaimo 
    21                  Commonwealth Holding Society.
    22     THE COMMISSIONER:  So it wasn't something that you discussed 
    23                  with Mr. Simpson or Mr. Stupich that by routing 
    24                  the money through a society prying eyes would not 
    25                  be able to --
 0026

     1              A   No, no.  No, I was a fund raiser and I made it 
     2                  very clear.
     3              Q   Now, while monies may have been donated I used 
     4                  the Broadway Commonwealth as an example, you knew 
     5                  that the arrangement existed that Mr. Simpson --
     6              A   Yes, I knew the arrangement was there.
     7              Q   And you knew that the Holding Society was a 
     8                  source of funds?
     9              A   The Holding Society had been set up to do 
    10                  educational work and research work for the new 
    11                  for -- for democratic socialism.
    12     THE COMMISSIONER:  Were you aware of any arrangement with the 
    13                  NDP executive, the table officers, to maintain 
    14                  some sort of record of monies that were deposited 
    15                  to a society for the benefit of the party so that 
    16                  those table officers could have a say in how 
    17                  those monies donated to the party for the party's 
    18                  uses would be dispersed?
    19              A   No, I wasn't aware of any relationship.  I did 
    20                  not handle money directly.  I knew that Mr. 
    21                  Sometime son was raising money, but I raised 
    22                  money for the party then and I still raise money 
    23                  for the party, I'm still called upon to raise 
    24                  money for the party.
    25     MS. SMITH: 
 0027

     1              Q   From Simpson also testified and this is on the 
     2                  13th of March of this year, that there was a 
     3                  policy and I'll read from page 61 this is a quote 
     4                  the policy indicates the British Columbia new 
     5                  democrats and its candidates not accept directly 
     6                  or indirectly any corporate donations except for 
     7                  those from small businesses who support the 
     8                  principles and policies of the new democratic 
     9                  party all such small business donations to be 
    10                  approved by the provincial executives?
    11                  You were aware of that policy.
    12              A   I was aware of that.
    13              Q   And you were also aware that Mr. Simpson was 
    14                  raising corporate monies?
    15              A   Yes.
    16              Q   Contrary to the policy?
    17              A   Yes the policy was broken.
    18              Q   All right. 
    19              A   But the policy was one that I argued vigorously 
    20                  against inside the party because frankly 
    21                  everybody knew as I understood it that there were 
    22                  people in the corporate area who gave money 
    23                  personally and some corporate donations so it was 
    24                  an idea of keeping one's skirts clean and at the 
    25                  same time knowing the policy was being broken, it 
 0028

     1                  was an internal debate in the party, very 
     2                  vigorous.
     3              Q   Was there vigorous debate about the use of the 
     4                  holding society in the context of corporation 
     5                  donations?
     6              A   Not that I recall.
     7              Q   One effect of giving donations to the Holding 
     8                  Society is that the corporate donations could not 
     9                  be seen as being made directly to the NDP, would 
    10                  you agree with that?
    11              A   Yes.
    12              Q   So --
    13              A   And it was hypocritical and that was the sense of 
    14                  the debate.  I had argued against it all along.
    15              Q   And with regard to the function that the society 
    16                  performed in that arrangement, if I characterized 
    17                  it as washing the monies or hiding their 
    18                  character, which breached the NDP policy, would 
    19                  you agree with that?
    20              A   No.  That was not my view.  I was very up front 
    21                  with everybody in the party what my opinion was 
    22                  about funding and if anybody asked me I would say 
    23                  very openly that indeed I know that money is 
    24                  being collected from donors against party policy 
    25                  and I know that it's going to the Nanaimo 
 0029

     1                  Commonwealth Holding Society.  I know other 
     2                  people have denied that and that's their right to 
     3                  deny it, but I was very open, very transparent 
     4                  about any connection in that regard.
     5              Q   So you were open and told people that corporate 
     6                  donations were Gaming Commission to the Holding 
     7                  Society?
     8              A   If anybody in the party asked me I told them.
     9              Q   And did people ask you?
    10              A   They may or may not.  I can't remember.  But I 
    11                  know there was always this raging debate about 
    12                  money.
    13              Q   But if nobody asked you you didn't have to be 
    14                  open about it isn't that right?
    15              A   Well, there were MLAs who knew about it and 
    16                  certainly my conversations with Mr. Simpson and I 
    17                  don't recall X, Y or Z but if anybody did ask me 
    18                  my answer would have been that.  It was a matter 
    19                  of deep division inside the party.
    20              Q   All right.  But the corporate donations didn't 
    21                  make it onto the NDP books?
    22              A   They went to the Nanaimo Commonwealth Holding 
    23                  Society.
    24              Q   Right so we know that Mr. Stupich knew about it, 
    25                  we know that Mr. Simpson knew about it and we 
 0030

     1                  know that you knew about it.  There was nothing 
     2                  disclosed in the records to the NDP members or 
     3                  executive that would disclose those corporate 
     4                  donations.  So separate and apart from the intent 
     5                  we will leave that aside right now, but the 
     6                  effect was to conceal those corporate donations, 
     7                  would you agree with that?
     8              A   It was not my intention and my association with 
     9                  the Nanaimo Commonwealth Holding Society to 
    10                  conceal any of those.  If others say they did not 
    11                  know then they say they did not know.  I'm 
    12                  telling you that I knew and I was transparent and 
    13                  I was part of the debate inside the party around 
    14                  this issue in general terms.
    15              Q   Let's just focus on the society.
    16              A   Yes.
    17              Q   The monies are raised for the NDP purposes?
    18              A   Right.
    19              Q   They are donated to a non-profit society?
    20              A   Right.
    21              Q   Not the NDP?
    22              A   Right.
    23              Q   The donations do not appear on the books and 
    24                  record available to the NDP general population, 
    25                  do you agree?
 0031

     1              A   Well, it wasn't revenue to the NDP, it was 
     2                  revenue to the Nanaimo Commonwealth Holding 
     3                  Society.
     4              Q   So that doesn't appears in the books and records 
     5                  available to the NDP general membership?
     6              A   No. 
     7              Q   Right.
     8              A   But it did appear in the Nanaimo Commonwealth 
     9                  Holding Society records.
    10              Q   Right?
    11              A   Yes.
    12              Q   But we know the money is intended for the NDP?
    13              A   For education, for democratic socialism and that 
    14                  encompassed some NDP activities.
    15              Q   Okay well Mr. Simpson's testimony wasn't that he 
    16                  was raising the funds for anything other than the 
    17                  new democratic party.
    18              A   Yes, I understand.
    19              Q   And so let's go back to the impact of the 
    20                  donations going to the Holding Society.  That 
    21                  money which we know from Mr. Simpson he raised 
    22                  for the new democratic party appeared pierce on 
    23                  the Holding Society books and records but does 
    24                  not appear on the books and records of the NDP 
    25                  party do you agree or disagree with that?
 0032

     1              A   I've never raised that question with the party 
     2                  but if that's the case then I agree with it.
     3              Q   Well you've testified there would be no reason 
     4                  the monies would show up on the books and records 
     5                  of the NDP because it went to the Holding 
     6                  Society?
     7              A   The Holding Society.
     8              Q   So the effect of donating those NDP corporate 
     9                  donations to the Holding Society as opposed to 
    10                  the new democratic party directly was that 
    11                  that -- those donations were concealed from the 
    12                  membership of the new democratic party, do you 
    13                  agree or disagree with that?
    14              A   I can't speak for the membership it certainly 
    15                  wasn't concealed from me.
    16              Q   I appreciate that Mr. Barrett.
    17              A   Yes.
    18              Q   But you know how it was treated you know that it 
    19                  went to the Holding Society --
    20              A   Yes.
    21              Q   -- not the New Democratic Party?
    22              A   Yes, and there were certainly more people than 
    23                  Mr. Simpson and myself and Mr. Stupich who knew 
    24                  that donations were being made to the Nanaimo 
    25                  Commonwealth Holding Society.
 0033

     1              Q   We'll get to that.
     2              A   Okay.
     3              Q   But without worrying about the intent, let's look 
     4                  at the effect.  The effect of the treatment of 
     5                  the these monies was that nobody simply looking 
     6                  at the books and records of the New Democratic 
     7                  Party unless they were in the loop about the 
     8                  corporate donations to NCHS, just looking at the 
     9                  books and records of the New Democratic Party 
    10                  they wouldn't have seen --
    11              A   I don't know whether or not the books of the New 
    12                  Democratic Party show any monies from Nanaimo 
    13                  Home, I don't know that.
    14              Q   Well we know and I think you've testified that 
    15                  the corporate donations would be recorded --
    16              A   Yes.
    17              Q   -- they were received at the Holding Society.  So 
    18                  can you think of any other effect or any reason 
    19                  knowing that the monies went to the Holding 
    20                  Society why --
    21              A   I can't.  This was a puzzle to me frankly because 
    22                  it was the donors who wanted their names 
    23                  concealed.  It was the donor of the money who did 
    24                  not want their name known as giving money towards 
    25                  work of the NDP or democratic socialism.  There 
 0034

     1                  was a mood of revenge of people associated with 
     2                  the New Democratic Party by the government.
     3              Q   Implicit in that desire by the donors to not be 
     4                  identified --
     5              A   Yes.
     6              Q   I mean one option is to say, gee sorry, we have 
     7                  to record it in the books and records of the 
     8                  party so you know, if you don't want to be 
     9                  identified we have to forego the donation because 
    10                  it's --
    11              A   Yes, well, that option obviously wasn't taken I 
    12                  mean yeah.
    13              Q   Right.  So another option that presented itself 
    14                  was right, cut a cheque to the NCHS and --
    15              A   Yes.
    16              Q   -- and nobody will know that you've given the 
    17                  money to the NDP?
    18              A   They gave it to the Nanaimo Commonwealth Holding 
    19                  Society.
    20              Q   When we were talking about the fund raising that 
    21                  you and Mr. Simpson participated in you were not 
    22                  raising money for the Nanaimo Commonwealth 
    23                  Holding Society, were you?
    24              A   Well, I didn't personally raise money, I knew I 
    25                  had raised money for the party and I personally 
 0035

     1                  had done that.  Mr. Stupich raised money for the 
     2                  Nanaimo Commonwealth Holding Society.  I was 
     3                  aware of that.
     4              Q   Right.
     5              A   Okay.
     6              Q   But we have heard no evidence that Mr. Simpson 
     7                  raised money for any organization other than the 
     8                  NDP, he certainly didn't testify that he was 
     9                  raising money for the Holding Society.
    10              A   Well, he turned the money over to the Holding 
    11                  Society.
    12              Q   That's right but you didn't understand Mr. 
    13                  Simpson to be going out to corporations in 
    14                  British Columbia and saying, would you like to 
    15                  donate to the Nanaimo Commonwealth Holding 
    16                  Society, you knew he was going --
    17              A   No no no it was transparent in Mr. Simpson's 
    18                  activities, as far as I knew.
    19              Q   That he was raising money for the NDP?
    20              A   That's right.
    21              Q   The monies raised by Mr. Simpson were for a party 
    22                  that you were a leader, right?
    23              A   During the time I was the leader and during the 
    24                  time of other leaders as well.
    25              Q   Once the monies were turned over to the Holding 
 0036

     1                  Society there was no way of the NDP to maintain 
     2                  control of those funds; is that right?
     3              A   Mr. Stupich had control of those.
     4              Q   Was there any mechanism in place other than Mr. 
     5                  Stupich, to ensure that the disbursements were 
     6                  spent on party purposes?
     7              A   I was never a member of the executive of the 
     8                  Nanaimo Commonwealth Holding Society so it's 
     9                  difficult for me to answer that question, but 
    10                  certainly speaking for myself I had complete 
    11                  trust in Mr. Stupich.
    12              Q   So that's actually an area I would like to 
    13                  explore.  Who -- once the monies were in the 
    14                  coffers of the NCHS did it lose its NDP character 
    15                  in your view?
    16              A   I don't know how it was handled or how it was 
    17                  accounted for.  I had complete trust as I assume 
    18                  others did in Mr. Stupich's handling of this.
    19              Q   So did you view the money that was donated to the 
    20                  NDP and deposited with the Holding Society as 
    21                  continuing to be the NDP's money or was it now 
    22                  Holding Society money?
    23              A   I never directed funds that were inside the 
    24                  Nanaimo Commonwealth Holding Society.  I was 
    25                  aware that funds were delivered to the Nanaimo 
 0037

     1                  Commonwealth Holding Society and I was in receipt 
     2                  of expense money for that period of time.  But I 
     3                  never was a participant in directing the funds 
     4                  anywhere at any time.  I had complete trust and 
     5                  no need from my frame of reference to ask any 
     6                  questions of Mr. Stupich.
     7              Q   You mentioned that you weren't a member of the 
     8                  executive of the NCHS at any time.  Did you think 
     9                  that the executive or board of directors of the 
    10                  Holding Society would be deciding how the money 
    11                  was spent?
    12              A   I had no idea.  I had no idea.  I just assumed 
    13                  that the executive were involved with Mr. 
    14                  Stupich.
    15              Q   With regard to the monies?
    16              A   To the funds.
    17              Q   Raised for the NDP?
    18              A   That's right.
    19              Q   So if there was a rogue board of directors and 
    20                  they used the money to fly to San Diego, that 
    21                  wasn't a concern or something that you turned 
    22                  your mind to?
    23              A   Well, first of all I don't know how to respond to 
    24                  the characterization of if there was a rogue 
    25                  board of directors.
 0038

     1              Q   Right.
     2              A   I had no reason to suspect any illegal activity 
     3                  by anyone connected with the Nanaimo Commonwealth 
     4                  Holding Society.  I had complete trust in Mr. 
     5                  Stupich.
     6              Q   Right, I appreciate that, but we have got a 
     7                  society registered society and it's got its 
     8                  constitution its listed objects.  And it raises 
     9                  money for its purposes and we have talked a bit 
    10                  about that.  And then we have got monies that are 
    11                  raised by and on behalf of the New Democratic 
    12                  Party deposited with that Holding Society.  And 
    13                  one of the things that we're looking at in this 
    14                  inquiry is the use of society assets.
    15              A   Mh-hmm.
    16              Q   And I'm interested in knowing once the monies 
    17                  were there who did you view to be responsible to 
    18                  look after them?
    19              A   Mr. Stupich.
    20              Q   As a member of the NCHS or as a member of the -- 
    21                  of your party?
    22              A   Mr. Stupich, as the head of the Nanaimo 
    23                  Commonwealth Holding Society.
    24              Q   As opposed to a senior member of the New 
    25                  Democratic Party; is that right?
 0039

     1              A   As opposed to -- all I knew was Mr. Stupich 
     2                  handled the Nanaimo Commonwealth Holding Society 
     3                  money and I had trust in Mr. Stupich.
     4     THE COMMISSIONER:  On that note it's past 11, we'll give the 
     5                  reporter a break.  We'll adjourn for 15 minutes. 
     6     THE REGISTRAR: All rise.
     7                  (BRIEF ADJOURNMENT)
     8     THE REGISTRAR: All rise. 
     9     MS. SMITH: 
    10              Q   Mr. Barrett, when we were discussing these 
    11                  matters before we broke I sort of threw out the 
    12                  Broadway society as an example of another society 
    13                  connected to the NDP where these corporate 
    14                  donations could have gone and I'm wondering if 
    15                  you can just explain what the Broadway society 
    16                  is?
    17              A   Well, the Broadway Commonwealth Society was a 
    18                  society that had been traditional for the CCF and 
    19                  for the NDP as I understood it, I was never a 
    20                  member of the board, but as I understand it to 
    21                  handle mortgages on property that the CCF, NDP 
    22                  had.  My first recollection of the Broadway 
    23                  Commonwealth Society and I may be completely 
    24                  wrong here, but my recollection is that they were 
    25                  the mortgage holder of our property on 571 East 
 0040

     1                  Broadway.  I had joined the party when was still 
     2                  the CCF Broadway Commonwealth Society as I 
     3                  understood it was an instrument to enable 
     4                  mortgages to be put on property and in some 
     5                  instances mortgages were put on property that 
     6                  help pay for campaigns, they were later paid off 
     7                  by raising funds in the party.
     8              Q   So it dealt with some aspects of the party 
     9                  finances; is that right?
    10              A   To my knowledge, yes, now I could be completely 
    11                  wrong but that's my recollection of the Broadway 
    12                  Commonwealth Society.
    13              Q   And there is a phrase that we have heard over the 
    14                  course of the testimony in this hearing, table 
    15                  officers of the party.  What are table officers?
    16              A   Table officers would be those people who are 
    17                  elected to run the administration of the party 
    18                  between conventions along with the one paid 
    19                  person on the table officers would be in effect 
    20                  provincial secretary.
    21              Q   And was there a connection between the board of 
    22                  directors of the Broadway Commonwealth Society 
    23                  and the table officers, to your knowledge?
    24              A   I would have to guess and my guess would be yes.
    25              Q   If we look at tabs 21 and 28 they might be 
 0041

     1                  instructive in this regard, tab 21 sets out a 
     2                  list of the provincial executive for 1983 and the 
     3                  table officers for '83 are listed as Jerry Stoney 
     4                  president, Joy Lannigan, Johanna de Hertog, Roger 
     5                  Howard treasurer, Anita Hagen, Dave Stupich, John 
     6                  Bruin and Joe Denofreo as provincial secretary.
     7              A   Right.
     8              Q   Does that accord with your recollection of the 
     9                  provincial executive?
    10              A   Yes.
    11              Q   And if we flip over to tab 28, this is a form 11 
    12                  pursuant to the Society Act the annual report of 
    13                  the Broadway Commonwealth Society.
    14              A   Yes.
    15              Q   And it is date stamped November 18, 1983 if you 
    16                  turn to the second page, the list of directors --
    17              A   Yes.
    18              Q   -- appear to be identical.
    19              A   Right, yes.
    20              Q   Now, Mr. Stupich we know was a member of the 
    21                  board of directors of the Nanaimo Commonwealth 
    22                  Holding Society.  Are you aware of anybody else 
    23                  in caucus other than Mr. Stupich --
    24              A   No.
    25              Q   -- that had been on the board of --
 0042

     1              A   Not to my knowledge.
     2              Q   So one incidental consequence of for example the 
     3                  corporate donations going to the Holding Society 
     4                  as opposed to the Broadway Commonwealth Society, 
     5                  is that nobody else in the party executive sees 
     6                  the corporate donations by Mr. Stupich, would you 
     7                  agree with that?
     8              A   Yes.
     9              Q   Now, if we can look at Exhibit 179, it's in the 
    10                  blue document book that I've had Madam Registrar 
    11                  before put you.
    12              A   Yes.
    13              Q   And it's a document that the accountants in the 
    14                  Parks investigation prepared.  And it sets out 
    15                  entries in another account that Mr. Stupich had 
    16                  created in the books and ledgers of the Nanaimo 
    17                  Commonwealth Holding Society.  And this account 
    18                  we had looked at the account that had the $600 
    19                  first payment in December of '75 to you and that 
    20                  was account 2094 this one is called the NDP 
    21                  headquarters account and it's account number 
    22                  2090.  And it shows transactions money going in 
    23                  and money going out of the account and if you can 
    24                  could just turn to the second page -- sorry, the 
    25                  third page of this document, and we have seen 
 0043

     1                  cheques drawn on the Holding Society that reflect 
     2                  the entries here and there is the first entry 
     3                  donation deposit in the amount of $47,750 and 
     4                  then there are a series of payments made by the 
     5                  Holding Society to a number of constituency, for 
     6                  example on the 28 of April 1983, $5,000 to the 
     7                  Kootenay NDP?  Do you see that, there is a box on 
     8                  page 3 sort of highlighting the transactions?
     9              A   Yes.
    10              Q   So deposit there sorry a cheque going to the NDP 
    11                  of -- on the 28th of April in the amount of 5,000 
    12                  similar amount on the same date to the Kamloops 
    13                  NDP and also 5,000 to the Columbia river?
    14              A   Yes.
    15              Q   Then on May the 2nd, $5,000 to the Burnaby 
    16                  Willingdon NDP Association, $4,000 May the 4th to 
    17                  the NDP of B.C. and then May 6, $350 going to the 
    18                  Dave Stupich campaign, 150 going to Yvonne Story 
    19                  and Barb Wallace and then on May the 13, 1983 
    20                  $70,000 going to the Broadway Printers.  What was 
    21                  happening in the spring of 1983 on the political 
    22                  horizon?
    23              A   I'm sorry what was happening politically? 
    24              Q   Yes, what was going on in B.C. politically in 
    25                  1983?
 0044

     1              A   There was a spring election in 1983.
     2              Q   Okay.  And these funds or these cheques that were 
     3                  made by or paid by the holding society and we 
     4                  have seen the cheques and Mr. Stupich's signatory 
     5                  on a number of them.  Do you have any knowledge 
     6                  as to how those funds came to be disbursed by the 
     7                  Holding Society to the various constituencies 
     8                  identified in --
     9              A   No, I don't have any knowledge of how or the 
    10                  decision was made to the disbursements to the 
    11                  constituencies but it's often that they were. 
    12              Q   Were there restrictions on how much money could 
    13                  be spent in the context of an election?
    14              A   No, I don't think so.  There needed to be a 
    15                  reporting of the source of the funds, but I'm 
    16                  getting a bit confused in my own mind because I 
    17                  had hoped for legislation to restrict the amount 
    18                  of money, no legislation that I can recall was 
    19                  passed to restrict the amount of money that could 
    20                  be spent at that time.
    21              Q   And with regard to the reporting requirements, 
    22                  can you tell us about those?
    23              A   Well, the total of income into the campaign and 
    24                  the total of the outcome of the campaign, the 
    25                  expenditures and the money raised.  Actually just 
 0045

     1                  the expenditures not the money raised that I can 
     2                  recall.  It was a pretty loose system.
     3              Q   And the reporting would be done by the party?
     4              A   By the party after, by the constituencies as 
     5                  well.
     6              Q   So it fair to conclude that monies spent by the 
     7                  Holding Society would not appear in the reporting 
     8                  done by the party?
     9              A   Well, I can't surmise one way or the other.  An 
    10                  examination of the documents would give the 
    11                  answer to that.
    12     THE COMMISSIONER:  Ms. Smith before you leave Exhibit 179 on 
    13                  the same page that you were referring to, the 
    14                  expenditures including the I don't know if you've 
    15                  covered this or not, the 70,000 to Broadway 
    16                  printers on May 13, '83, this page shows a 
    17                  balance positive balance at the bottom after 
    18                  year-end of close to $50,000 and over on the 
    19                  right there's some characterization of that under 
    20                  the heading description in F/S which I assume is 
    21                  financial statement and the description is 
    22                  "hidden (term deposit)."
    23              Q   Right?
    24     THE COMMISSIONER:  First of all is this one of those documents 
    25                  prepared by Parks and Allan by way of the summary 
 0046

     1                  from the ledgers of the NCHS.
     2     MS. SMITH:  Yes it is, and it's a draft as you'll notice in 
     3                  the right-hand.  I've covered the areas that I've 
     4                  discussed with Mr. Barrett with the earlier 
     5                  witnesses.  I haven't dealt with that.
     6     THE COMMISSIONER:  What I'm wondering though sometime today if 
     7                  we could just confirm whether or not that term 
     8                  "hidden (term deposit)" is editorial comments of 
     9                  Parks and Allan or an entry of Mr. Stupich.
    10     MR. RADNOFF:  I can tell you, Mr. Commissioner, this relates a 
    11                  very long time ago to the evidence of Mr. Kinsey 
    12                  who covered this, and one of his reports to the 
    13                  police and he described how on the financial 
    14                  statements these amounts were hidden so they did 
    15                  not appear, although though appeared in the books 
    16                  and ledgers of NCHS, they were hidden from the 
    17                  financial statements, they did not appear on the 
    18                  financial statements of NCHS.
    19     THE COMMISSIONER:  Is that characterization then of "hidden" 
    20                  Mr. Kinsey's editorializing?
    21     MR. RADNOFF:  No, that's Mr. Parks and Mr. Allan, and I guess 
    22                  we didn't put the questions to them but they 
    23                  would agree with Mr. Kinsey's evidence that it 
    24                  was hidden.
    25     THE COMMISSIONER:  But "hidden" didn't show up in the NCHS 
 0047

     1                  books as a term describing this balance of 
     2                  monies? 
     3     MR. RADNOFF:  No no it's editorial, it means it did not, when 
     4                  they say "hidden" it means these amounts did not 
     5                  appear on the financial statements of NCHS.
     6     THE COMMISSIONER:  All right, thank you.
     7     MS. SMITH: 
     8              Q   Mr. Barrett, I'm going to switch to a new topic 
     9                  regarding the events surrounding the Williams 
    10                  resignation and the by-election in 1976 and I'll 
    11                  ask you to turn back to Exhibit 72 document book 
    12                  74 and just going again back to the first tab 
    13                  which is this document relating to the results of 
    14                  the 31st general election and returning to the 
    15                  last page of that tab.
    16              A   Yes.
    17              Q   All right.  Just on the bottom portion of the top 
    18                  box in the document it says with regard to the 
    19                  by-election Vancouver east reason for calling 
    20                  resignation of RA Williams 27 February 1976 to 
    21                  provide seat for D Barrett.
    22              A   Yes.
    23              Q   So is the 27th of February, '76 when Mr. Williams 
    24                  actually resigned his seat?
    25              A   Yes.
 0048

     1              Q   I'm going to refer to the book with which I'm 
     2                  sure you're familiar it's entitled Barrett a 
     3                  passionate political life and you are the 
     4                  co-author along with William Miller; is that 
     5                  right?
     6              A   That's right.  His career has been destroyed 
     7                  since.
     8              Q   And at page 114 of your book you discuss the 
     9                  events of the '75 defeat and the resulting 
    10                  by-election.  And you indicate that you and your 
    11                  by went on a holiday after your loss and you say 
    12                  at page 114:
    13                       While I was away the caucus deliberated over 
    14                       what the party should do.  A series of 
    15                       very tense meetings followed my arrival 
    16                       back in Victoria.  There were 20 or so 
    17                       people attending.  The majority wanted me 
    18                       to continue to lead the party but I had 
    19                       lost my seat so if I was going to remain 
    20                       as leader somebody would have to resign.  
    21                       Almost immediately Bill King offered his 
    22                       seat but the caucus refused.  He was from 
    23                       the rural interior riding of Revelstoke 
    24                       Slocan and I was a city slicker.  Another 
    25                       solution would have to be found.  After 
 0049

     1                       considerable debate in caucus and a 
     2                       caucus meeting Bob Williams offered his 
     3                       seat in Vancouver east.  We had agreed 
     4                       that whoever stepped down would become a 
     5                       research coordinator in the NDP 
     6                       provincial office.  We knew we were 
     7                       moving into a tough period where the so 
     8                       credits were likely to launch an assault 
     9                       on the legislation, we wanted somebody 
    10                       working for the party outside the 
    11                       legislature who was tough and bottom 
    12                       minded.  Ideally that person would also 
    13                       have cabinet experience.  Williams fit 
    14                       the bill perfectly and did a good job for 
    15                       the party and the caucus the during that 
    16                       difficult time.
    17                  With regard to the opening sentence of the 
    18                  third paragraph that I read it says:
    19                       We had agreed that whoever stepped down 
    20                       would become a research coordinator in 
    21                       the NDP provincial office.
    22                  Who is "we"?
    23              A   The caucus members who were sitting around 
    24                  discussing.
    25              Q   And who did that include?
 0050
 

     1              A   Everybody that was present at the meeting.
     2              Q   And who was that?
     3              A   Well, every caucus member that was elected at the 
     4                  time and myself and non-caucus members might have 
     5                  included Mrs. Thomas and Mr. Beach but neither 
     6                  would have said anything.  I doubt if Mr. Beach 
     7                  would have been there.  Possibility of Mrs. 
     8                  Thomas being there.
     9              Q   And in your book there's absolutely no mention of 
    10                  the Holding Society being a factor in the 
    11                  discussions of caucus.
    12              A   No.
    13              Q   The discussion is hire Williams to do research to 
    14                  be the research coordinator in the NDP provincial 
    15                  office.
    16              A   That's right.
    17              Q   Let's go to tab 2 of Exhibit 222, which is a 
    18                  letter on Stevenson Doell & Company letterhead 
    19                  dated the 26 of February 1976.
    20              A   I'm sorry what tab? 
    21              Q   Tab 2.
    22              A   Yes, right.
    23              Q   And it's addressed to Mr. Stupich Nanaimo 
    24                  Commonwealth Holding Society.  Have you seen this 
    25                  document before it was provided?
 0051

     1              A   Yes, I've seen this document before.
     2              Q   And in what context?
     3              A   I saw it in the context of the Parks report.
     4              Q   Any time prior to that?
     5              A   I can't recall.
     6              Q   So this letter is dated the day before Mr. 
     7                  Williams resigns, agreed?
     8              A   Yes.
     9              Q   All right.  And it says in the first paragraph:
    10                       This letter will confirm that the society -- 
    11                       here we're talking about the Holding 
    12                       Society -- has paid the sum of $80,000 to 
    13                       this firm and has given us irrevocable 
    14                       instructions that the said sum is to be 
    15                       used to purchase for the society an 
    16                       annuity for the benefit of Robert 
    17                       Williams.  The annuity provides 
    18                       remuneration for services rendered and to 
    19                       be rendered by Williams.
    20                  The next paragraph deals with the way the annuity 
    21                  is to be paid in the first sentence and then the 
    22                  second sentence says:
    23                       These funds are paying to Mr. Williams or 
    24                       payable to Mr. Williams in consideration 
    25                       of his performing certain works and 
 0052

     1                       duties for the New Democratic Party 
     2                       during the aforesaid period of time.  The 
     3                       funds are payable to Mr. Williams or his 
     4                       estate annually and irrevocably.
     5                  Now, this letter seems to reflect your 
     6                  description of the events and tasks Mr. Williams 
     7                  is being hired to work for the NDP.
     8              A   Right.
     9              Q   So why was the Holding Society paying for 
    10                  services that the NDP was going to receive?
    11              A   Well, I don't have a definitive answer.  I was 
    12                  not involved in the direct negotiations, I was 
    13                  aware that they were taking place.  The 
    14                  negotiations took place between Mr. Williams and 
    15                  Mr. Stupich.  I was aware that they were taking 
    16                  place but I didn't know the circumstances or the 
    17                  nature of the deal.
    18              Q   Was there any discussion of for example 
    19                  mortgaging property held by the Broadway 
    20                  Commonwealth society to come up with the funds 
    21                  for Mr. William as opposed to going to the 
    22                  Nanaimo Commonwealth Holding Society?
    23              A   Not to my recollection.  The discussions I 
    24                  participated in were after that date as to the 
    25                  nature of the assignments to be given to Mr. 
 0053

     1                  Williams.
     2              Q   The last sentence of the letter says:
     3                       The funds are payable to Mr. Williams or his 
     4                       estate annually and irrevocably.
     5                  Which I take to mean that if something tragic 
     6                  had happened to Mr. Williams the following day 
     7                  and he had been able to do nothing --
     8              A   Yes.
     9              Q   -- further that the $80,000 was still in his 
    10                  estate's favor, is that how you read it?
    11              A   That's how I read it.
    12              Q   Were you aware of the fact that monies had been 
    13                  advanced by the Holding Society on such terms?
    14              A   No, not until I saw the letter.
    15              Q   Would you agree with the characterization that 
    16                  that's a risk assumed by the society?
    17              A   I don't know if I could define it as risk.  In 
    18                  these kind of situations and they have been 
    19                  common over 300 years of parliament, all kinds of 
    20                  arrangements take place. 
    21                       Recently there were five federal cabinet 
    22                  ministers who left Mr. Chretien's cabinet all of 
    23                  whom went on to other assignments and tasks.  I 
    24                  don't know the definition of what those 
    25                  assignments and tasks were, but this is common 
 0054

     1                  practice.  Ms. Mayhue became a senator and as I 
     2                  recall she publicly said I'm not quitting until I 
     3                  become a senator.  Others in similar 
     4                  circumstances obviously make arrangements for 
     5                  their own selves as they move in a different 
     6                  direction.  Mr. Cowie stepped down for Mr. 
     7                  Campbell and Mr. Cowie is quoted in the Vancouver 
     8                  Sun as saying and my reward is to become the so 
     9                  and so and such and such. 
    10                       So in the nature of this kind of resigning 
    11                  seats it's even officially recognized in the 
    12                  documents, the election return documents, Mr. 
    13                  Williams stepped down providing the seats.  So 
    14                  these kinds of arrangements historically in my 
    15                  opinion are not unique.
    16              Q   Right, and is it's actually not that angle that 
    17                  I'm pursuing.
    18              A   Yes.
    19              Q   It's that we know from the evidence of the 
    20                  accountants that there was about $20,000 of NDP 
    21                  money which Mr. Stupich had identified as being 
    22                  held on behalf of the NDP in the NCHS accounts.  
    23                  So the Holding Society came up with over $60,000 
    24                  to effect this arrangement and it's with regard 
    25                  to those monies by the Holding Society, not by an 
 0055

     1                  NDP organization or a for-profit corporation or 
     2                  anything like that, it's the not-for-profit 
     3                  holding society that is advanced money for which 
     4                  they may get no return as set out in that last 
     5                  paragraph that I'm concerned about.  And my 
     6                  question is, were you aware that the Holding 
     7                  Society monies had been used in this manner and 
     8                  I'll let you answer that?
     9              A   I was aware there was a deal between the Holding 
    10                  Society and Mr. Williams that the party was aware 
    11                  of.
    12              Q   And when you say the party was aware of --
    13              A   The executive of the party.
    14              Q   The executive of the New Democratic Party as of 
    15                  1976?
    16              A   Yes.
    17              Q   Now, did you understand that it was a gift from 
    18                  the Holding Society or did you understand that it 
    19                  was a loan to the NDP from the Holding Society?
    20              A   My recollection was that it was a loan to the 
    21                  party and that the party was going to pay some of 
    22                  this money back.  Now, that's my recollection.  
    23                  My recollection may be incorrect.
    24              Q   Was there discussion along the lines of -- well, 
    25                  let's look at how it happened we know that the 
 0056

     1                  money went from the Holding Society to Mr. 
     2                  Williams and that in fact the Holding Society was 
     3                  repaid by the NDP.
     4              A   Yes.
     5              Q   Was there discussion that the Holding Society 
     6                  loan the New Democratic Party the money directly 
     7                  and then the New Democratic Party advanced monies 
     8                  to Mr. Williams?
     9              A   There was -- none of that detailed discussion was 
    10                  in caucus and I wasn't aware of any of it.  I had 
    11                  picked up bits and pieces that the money would, 
    12                  you know, as I say, as I understood the money was 
    13                  going to be paid back to the Nanaimo Commonwealth 
    14                  Holding Society. 
    15              Q   From an optics point of view did you have any 
    16                  concern with regard to the New Democratic Party 
    17                  advancing $80,000 Mr. Williams in the particular 
    18                  circumstances which were his resignation and your 
    19                  running?
    20              A   From an optics point of view?  Not, no, I don't 
    21                  think so.  You know, we don't have a senate to 
    22                  send people to our party, we don't have other 
    23                  jobs to send people to.  This is a unique 
    24                  situation, as far as the optics they would be 
    25                  interpreted by the media the way they wanted to 
 0057

     1                  interpret them.  This is -- no, I didn't have any 
     2                  sense of the optics or anything like that.
     3     THE COMMISSIONER:  I think the general tenor of the question 
     4                  correct me if I'm wrong, is that was the NCHS 
     5                  used in order to conceal this payment to Mr. 
     6                  Williams so that the party wasn't seen as paying 
     7                  Mr. Williams and as I understand your answer --
     8              A   I wouldn't think so.
     9     THE COMMISSIONER:  No.
    10              A   I wouldn't say so.
    11     MS. SMITH: 
    12              Q   If we can go to tab 12, this is still dealing 
    13                  with this issue of the funds paid and this is a 
    14                  letter authored by Mr. Williams to the lawyer at 
    15                  Stevenson Dole dated April 9, 1979.  Again, have 
    16                  you seen this letter before?
    17              A   Yes.
    18              Q   And when was that?
    19              A   I think the first recollection was the Parks 
    20                  report, but I'm aware of the -- I was aware that 
    21                  there was a dispute going.
    22              Q   And this letter is about 38 months after the 
    23                  initial purchase --
    24              A   That's correct.
    25              Q   And was it your understanding that the dispute 
 0058

     1                  related to the interest earned on the --
     2              A   That's correct, yes.
     3              Q   So then if we go to I'll read the first 
     4                  paragraph:
     5                       Dear Marnie I have discussed the 
     6                       Commonwealth matter with Dave Barrett and 
     7                       I gather Dave Stupich was going to 
     8                       contact you as well.  I will discuss the 
     9                       matter with them both further so I trust 
    10                       that no action will be taken into the 
    11                       meantime.  I am of the opinion that the 
    12                       funds should be paid to myself and that 
    13                       will be pursued with them.  The NDP has 
    14                       made arrangements to compensate the 
    15                       Commonwealth group in past and current 
    16                       budgets.  Such being the case I don't 
    17                       think there is any doubt to the funds 
    18                       should be paid to me.
    19              A   Yes.
    20              Q   And then at paragraph -- sorry at tab 13 there is 
    21                  a letter again to Marnie Stevenson and this is 
    22                  dated two days later April 11, 1979 and it is on 
    23                  Nanaimo Commonwealth Holding Society letterhead 
    24                  signed by Mr. Stupich as treasurer for that 
    25                  organization.  Did you see this document before 
 0059

     1                  receiving these materials?
     2              A   I don't recall seeing this document, but I was 
     3                  aware of the dispute.
     4              Q   Okay and basically this letter sets out that it's 
     5                  Mr. Stupich's position as of April 11, '79 that 
     6                  Mr. Williams has received 36 payments totalling 
     7                  80,262, he notes that that's $262 more than the 
     8                  80,000 agreed.  And his last paragraph says:
     9                       From a previous discussion with you 
    10                       regarding the annuity I believe there 
    11                       should be approximately four payments 
    12                       left since the Nanaimo Commonwealth 
    13                       Holding Society has discharged its 
    14                       agreement with your client and indeed has 
    15                       overpaid him, the remaining payments 
    16                       should be made to the society at this 
    17                       address.
    18                  And the payments are in the amount of $2,229.50.
    19                  So with regard to the dispute, you understand -- 
    20                  you understood that Mr. Williams wanted the 
    21                  interest?
    22              A   Yes.
    23              Q   And you understood that Mr. Stupich on behalf of 
    24                  the Holding Society wanted the interest, is that 
    25                  fair?
 0060

     1              A   Yes that's right.
     2              Q   All right.  Now you were aware obviously that Mr. 
     3                  Stupich had a role to play in relation to the 
     4                  Holding Society.
     5              A   Yes.
     6              Q   And you understood that he was a director?
     7              A   Mr. Stupich was the -- as far as I was concerned 
     8                  -- the Nanaimo Commonwealth Holding Society.
     9              Q   And you appreciated that that created certain 
    10                  duties and obligations on him in relation to the 
    11                  Holding Society is that fair?
    12              A   Sure.
    13              Q   Now, if we can to tab 15 this is a letter dated 
    14                  June 20, 1979 and it is signed apparently by 
    15                  Marnie M Steveston and it's addressed to Mr. 
    16                  Stupich it says:
    17                       Re Nanaimo Commonwealth Holding Society 
    18                       Robert Williams, enclosed is a statement 
    19                       of receipts and disbursements of funds in 
    20                       the above matter.  I would ask that you 
    21                       endorse a copy of this letter authorizing 
    22                       me to pay out to Mr. Williams the sum of 
    23                       $7,222.90 in accordance with the 
    24                       statement.
    25                  And then there's hand notation which has been 
 0061

     1                  identified as Mr. Stupich's and it says:
     2                       27/June/79, "original contract" was for a 
     3                       total of $80,000.  R.W.
     4                  And that would be Robert Williams.
     5              A   Mh-hmm.
     6              Q        Appealed to D Barrett who asked me to agree 
     7                       with the new total per attached of 
     8                       $90,964.33.
     9                  Did you ask Mr. Stupich to agree with the 
    10                  disposition of funds as set out there?
    11              A   Mr. Williams appealed to me, he asked me to agree 
    12                  with new total -- my statement as I recall to Mr. 
    13                  Stupich was do whatever he thought was fair. 
    14              Q   Mr. Stupich then notes:
    15                       I asked for one additional member of caucus 
    16                       to be informed and Dave suggested Bill 
    17                       King.
    18              A   Yes.
    19              Q   Now, can you tell us about what you being 
    20                  recall --
    21              A   Well, Dave Stupich spoke to me about this, I 
    22                  remember this quite clearly, and I said, look, 
    23                  whatever you think is fair, Bob has a position 
    24                  he's stated that position to me and my feeling is 
    25                  do whatever you think is fair.  Dave Stupich as I 
 0062

     1                  recall said well, I would like to talk to other 
     2                  members of caucus I said well, you know, I'm sure 
     3                  Bob has too, so whatever, you know, whatever you 
     4                  want to do that you think is necessary to do, and 
     5                  I may have mentioned King or Alec MacDonald or 
     6                  someone else, anyone else.
     7              Q   You understood that the initial principal that 
     8                  had been invested in the annuity on behalf of Mr. 
     9                  Williams had come from the Holding Society?
    10              A   That's correct.
    11              Q   And so that monies earned on that income, the 
    12                  interest had been earned on that income or on 
    13                  this initial principal; is that right?
    14              A   Yes.
    15              Q   And given that Mr. Stupich played an instrumental 
    16                  role in the Holding Society, did it not strike 
    17                  you as odd that he wanted to discuss this issue 
    18                  of entitlement to these proceeds with another 
    19                  member of caucus as opposed to a them of board of 
    20                  directors of the Holding Society?
    21              A   I found it odd that he wanted to discuss it, that 
    22                  Bob Williams wanted to discuss it with me, and 
    23                  then I found it odd that Stupich wanted to 
    24                  discuss it with me.  I viewed it as a dispute 
    25                  between Stupich and Williams over this and 
 0063

     1                  whatever arrangement they had entered through Ms. 
     2                  Stevens, and I viewed it simply as a dispute 
     3                  between those two, yes.
     4              Q   What relevance did caucus have to that money?
     5              A   None that I could see.  It was -- let's be frank, 
     6                  I have described everybody as friends in a 
     7                  caucus, some people are less than friends on some 
     8                  occasions.
     9              Q   Right, but it's the issue of caucus having any 
    10                  input about what happens to the money?
    11              A   The caucus had no input on this.  Williams came 
    12                  to me as an individual, asked my opinion, I don't 
    13                  recall it ever this issue ever being discussed in 
    14                  caucus.
    15              Q   Right but then we see the initials that have been 
    16                  identified as Bill King's under the authorization 
    17                  section of the document, we see WSK, and his 
    18                  initials also appear on the last page of this 
    19                  document where the statement of disbursements 
    20                  sets out $7,222.90.  So somewhere along the line 
    21                  caucus or a member of caucus gets involved in 
    22                  this process as opposed to a member of the board 
    23                  of directors of the Holding Society and I'm 
    24                  curious as to why that is.
    25              A   I have no idea.  I know that that Mr. King had 
 0064

     1                  initialled the letter, but the caucus had no 
     2                  authority over Nanaimo Commonwealth Holding 
     3                  Society and caucus had no authority in the 
     4                  dispute between Mr. Williams and Mr. Stupich.  
     5                  Mr. Williams was appealing to caucus members to 
     6                  plead his case and my response to Mr. Williams's 
     7                  plea was to say to Mr. Stupich, do what you think 
     8                  is right.  I had no authority.  And the caucus 
     9                  had no authority. 
    10              Q   Did it occur to you to say to Mr. Stupich, see 
    11                  what your board of directors thinks is right?
    12              A   No.
    13              Q   Did it appear to you that Mr. Stupich was making 
    14                  decisions with respect to the society's finances 
    15                  on his own independent of his board of directors?
    16              A   I never questioned Mr. Stupich's activities with 
    17                  the Nanaimo Commonwealth Holding Society.  I had 
    18                  complete trust in Mr. David Stupich.  There was 
    19                  no cause for me to even raise that kind of issue 
    20                  as far as I was concerned. 
    21              Q   In May of 1984 --
    22              A   Yes.
    23              Q   -- there was a NDP convention; is that right?
    24              A   That's right.
    25              Q   And the leadership of the party was determined on 
 0065

     1                  the 18th of that month; is that correct?
     2              A   That's correct.
     3              Q   Were you -- what was your role in the party at 
     4                  that time?
     5              A   I was the lame duck leader of the party.  I 
     6                  wanted to leave a year earlier but the caucus and 
     7                  the party decided -- the caucus recommendation 
     8                  and the party decided not hold a leadership 
     9                  convention immediately, but in the following May 
    10                  as that's the classical political expression of 
    11                  the role of a leader who's no longer going to be 
    12                  the leader, the guillotine has not yet fallen but 
    13                  the head is in place, and I just wanted the plug 
    14                  pulled or the lever pulled and out of it.  I was 
    15                  very, very tired and I thought it was important 
    16                  to get a new leader as quickly as possible.
    17              Q   Did you support anybody in particular who was 
    18                  running?
    19              A   No, I did not support anyone.  I had been through 
    20                  the trauma of through political leaderships 
    21                  before that, and unless you've been involved in 
    22                  that kind of exercise it is impossible to explain 
    23                  the scars.  It becomes a strange feeding frenzy 
    24                  that absents itself from normal activity in any  
    25                  political party.  And you are witnessing it again 
 0066

     1                  in the -- currently in the leadership race in 
     2                  another major political party.
     3              Q   I'm just going to give you a copy of a newspaper 
     4                  article it's not in the exhibit book and I've 
     5                  roughed in some highlights.
     6     THE COMMISSIONER:  We'll mark that as the next exhibit.
     7     THE REGISTRAR: Exhibit 223.
     8     THE COMMISSIONER:  Thank you. 
     9                  (Exhibit 223:  Newspaper article)
    10     MS. SMITH: 
    11              Q   It's a very small typed copy of an article from 
    12                  the Vancouver Sun February 27, 1984 and it's 
    13                  entitled NDP hopefuls where they stand.  The 
    14                  first paragraph says:
    15                       Bill King is running for the provincial NDP 
    16                       leadership on his record as a labor 
    17                       minister, when he introduced the labour 
    18                       code, the labor relations board, human 
    19                       rights code and appointed women to 
    20                       positions of responsibility.  He has 
    21                       geared his campaign to a theme of 
    22                       regional representation.
    23                  And if you drop down three paragraphs to the 
    24                  paragraph starting born in Saskatchewan it says:
    25                       King was first elected in B.C. in 1968 
 0067

     1                       by-election, defeated in the 1969 general 
     2                       election, he was re-elected in 1972, '75 
     3                       and '79.  He served as interim NDP leader 
     4                       in 1976 until the leader Dave Barrett 
     5                       returned to the house in a by-election 
     6                       and as NDP house leader from 1976 to 80.
     7                  And then if you move over to the right to the 
     8                  third column and I've highlighted it for you 
     9                  starting with there's lot of respect for Dave 
    10                  Stupich.
    11              A   Yes.
    12              Q   It says:
    13                       No one has more personal respect than Dave 
    14                       Stupich in the party.  The oldest 
    15                       candidate, the white-haired Stupich 
    16                       embodies for many the ideals the old CCF.  
    17                       He stresses his long service to the party 
    18                       and the lengthy process of developing 
    19                       policies that stand the test of time.  
    20                       His strength was -- sorry -- strengths 
    21                       are seen in the areas of finance, he is a 
    22                       chartered accountant, former finance 
    23                       minister and current NDP finance critic.  
    24                       An organization he is the biggest best 
    25                       riding in the association in Nanaimo.  
 0068

     1                       First elected to the legislature in '63 
     2                       Stupich was president of the party from 
     3                       1969 to '72 as minister of agriculture he 
     4                       introduced the agricultural land reserve.  
     5                       "I have no concern about the policy we 
     6                       have been developing for 51 years of 
     7                       discussions." Stupich said in Victoria my 
     8                       only concern is that we have not been 
     9                       empowered long enough to implement all of 
    10                       them.
    11                  So we know Mr. King is running, we know Mr. 
    12                  Stupich is running, Dave Vickers, Graham Lea, 
    13                  Margaret Birrell and Bob Skelly are also 
    14                  identified in the article as contenders. 
    15                       So as somebody not seeking the leadership 
    16                  what were you doing politically in 1984?
    17              A   As little as possible. 
    18              Q   All right. 
    19              A   I made it very clear to people who asked me about 
    20                  supporting them or their campaigns that I would 
    21                  not be supporting anyone, that they were all good 
    22                  candidates.  I had been through a very bitter 
    23                  leadership fight, not for me personally, but 
    24                  certainly divisive for the party in 1967 and 
    25                  again in '69.  I did not wish to be part of the 
 0069

     1                  campaign as the former leader because it was the 
     2                  party that had to live with the leader they 
     3                  chose.  These are very difficult times in any 
     4                  political party and for our part they seem to be 
     5                  even more difficult, so I did not play a part in 
     6                  the leadership campaign.
     7              Q   Did you occur any expenses in the spring of '84 
     8                  in relation to the leadership campaign or any 
     9                  NDP --
    10              A   I don't recall.
    11              Q   Are there any restrictions on the amount that can 
    12                  be spent in the leadership race?
    13              A   The restrictions in a leadership race are 
    14                  generally imposed by the parties itself, not 
    15                  legally.
    16              Q   Were any restrictions imposed by the party?
    17              A   I don't recall in that campaign if there were or 
    18                  not.
    19              Q   How would we find out?
    20              A   How would I find out?
    21              Q   Or how would we find out, who would we speak to?
    22              A   I suppose party minutes would show it or just 
    23                  phone somebody -- I don't recall any restrictions 
    24                  being placed on them.
    25              Q   If we can just flip to tab 20 of Exhibit 222 and 
 0070

     1                  again these are entries in the books and records 
     2                  of the Holding Society in Mr. Stupich's hand.  
     3                  And I would ask you to turn to page 2.  Tab 20.
     4              A   Okay, yeah.
     5              Q   Page 2.  And this is a page from the ledger with 
     6                  regard to account 2094 which is the special 
     7                  caucus account, one of the two NDP accounts set 
     8                  up by Mr. Stupich at the Holding Society.
     9              A   Right.
    10              Q   And it's in very small script as is his style but 
    11                  I'll just direct your attention to the third, 
    12                  fourth and fifth entry on the top the name and 
    13                  we're dealing with 1984 as indicated on the 
    14                  left-hand side.  The month of May.
    15              A   Okay.
    16              Q   And under the words special caucus, appear King, 
    17                  2094, Stupich and then beside that, other.  Do 
    18                  you recognize or can you see those?
    19              A   I'm sorry I'm not able to follow.
    20     THE COMMISSIONER:  Across the top.
    21              A   Oh, okay.
    22     MS. SMITH: 
    23              Q   Special caucus and it says King, Stupich and 
    24                  other?
    25              A   Yes.
 0071

     1              Q   And then the entries on the left-hand side 
     2                  indicate the parties involved in the various 
     3                  transactions and the first entry is May 16 and 
     4                  it's I've seen these documents blown up so I can 
     5                  tell you sa it says Mark Hobbs in trust and then 
     6                  if you can to the King column there's $1,000?
     7              A   King column, yes.
     8              Q   And then again on May 16, Marg Hobbs in trust 
     9                  another $1,000?
    10              A   Yes.
    11              Q   And if you drop down three lines there is for May 
    12                  the 7th, Marg Hobbs $1,500 and if we move over to 
    13                  the Stupich column?
    14              A   Yes.
    15              Q   You can see an entry DDS campaign $5,000 on the 
    16                  16th of May?
    17              A   Yes.
    18              Q   And then if you go to the next column which is 
    19                  other?
    20              A   Yes.
    21              Q   June the 6th I think it says Harvey Beach $1,800.  
    22                  Were you aware of -- apart from this document 
    23                  where it says special caucus, was there was the 
    24                  term special caucus used in any context?
    25              A   Not to my knowledge.
 0072

     1              Q   Okay we know that Mr. King and Mr. Stupich were 
     2                  running for the leadership of the party in this 
     3                  time frame.  Are you aware of any other political 
     4                  activity or NDP related activity that was 
     5                  happening in May of 1984?
     6              A   I don't remember.  At that point I had pretty 
     7                  well pulled myself out of all party activities.  
     8                  From actually -- from the '83 election on I don't 
     9                  even think I went to an executive meeting.  I 
    10                  went to very few before that. 
    11              Q   So are you aware of any campaign other than Mr. 
    12                  Stupich's efforts to become leader of the party 
    13                  that would relate that we see the entry DDS 
    14                  campaign, are you aware of any other campaign Mr. 
    15                  Stupich was involved in other than the campaign 
    16                  to become the leader of the party?
    17              A   I don't have any knowledge of that.
    18              Q   If you can turn, please, to tab 17 of Exhibit 
    19                  222?
    20     THE COMMISSIONER:  Ms. Smith were you going to ask if Mr. 
    21                  Barrett was aware of the reasons that Mr. Beach 
    22                  was paid $1,800?
    23     MS. SMITH:  Yes we can do that now.
    24              Q   On page 2 of 220 there is the $1,800 payment to 
    25                  Harvey Beach.
 0073

     1              A   Yes.  Mr. Beach would cease to be my executive 
     2                  assistant at this point when I stepped down as 
     3                  leader.  If there were any expenses outside of 
     4                  his normal compensation that was caused by him 
     5                  being executive assistant to me, that would have 
     6                  been a payment for his expenses.  That has been 
     7                  done before as well.
     8              Q   So you did not receive the $1,800; is that 
     9                  correct?
    10              A   Me? 
    11              Q   Yes.
    12              A   No.
    13              Q   You're familiar with the Parks report; is that 
    14                  right?
    15              A   I'm aware of it, yes, I mean I'm not familiar 
    16                  page by page but I'm --
    17              Q   Have you read it?
    18              A   Yes, I've read it.
    19              Q   It's been marked as Exhibit 4 in these 
    20                  proceedings and just before we deal with the 
    21                  document at tab 17 I'm going to read what the 
    22                  Parks team wrote at page 107 and they say:
    23                       In the May 5, 1983 provincial election Mr. 
    24                       Stupich was re-elected but Mr. David 
    25                       Barrett then the leader of the provincial 
 0074

     1                       party lost his seat.  As a result on May 
     2                       25, 1983 Mr. Barrett indicated that he 
     3                       would step down as leader and a 
     4                       leadership contest ensued.  Mr. Stupich 
     5                       announced his candidacy the same day.
     6                  Does that accord with your recollection of 
     7                  events?
     8              A   It could be. 
     9              Q   You don't recall indicating that you would step 
    10                  down as leader on the 25 of May, 1983?
    11              A   I don't remember the date that I made it known 
    12                  publicly that I wanted to step down, but caucus 
    13                  would have known before then that I wanted out.
    14              Q   Okay.  He then says that -- sorry, Mr. 
    15                  Commissioner, I may not be able to find the 
    16                  reference right now, but Mr. Parks in his review 
    17                  of the documents including the books and records 
    18                  of the Holding Society came across an entry -- 
    19                  this is at page 106:
    20                       We noted that on May 26, 1983, $12,500 in 
    21                       $50 bills was deposited into the NCHS 
    22                       bank account at the Nanaimo credit union 
    23                       and credited to the NDP headquarters 
    24                       account.  Mr. Simpson advised us that he 
    25                       was not aware of this deposit and 
 0075
 

     1                       therefore we do not know the origin of 
     2                       these funds.  Mr. Stupich's working 
     3                       papers for 1983 indicated that the source 
     4                       of the funds -- sorry, indicated the 
     5                       source of the deposit as "DB".
     6                  Now, at tab 17 of the document book, Exhibit 22, 
     7                  there is a deposit slip made out to the benefit 
     8                  of the Nanaimo Commonwealth Holding Society, we 
     9                  understand the monies were deposited by Betty 
    10                  Marlow, the amount is $12,500 and it's indicated 
    11                  that they are comprised of 250, $50 bills.
    12              A   Yes.
    13              Q   Now, you have knowledge with regard to this 
    14                  transaction; is that correct?
    15              A   Yes, I do.
    16              Q   All right and can you tell us please was the 
    17                  $12,500 the complete amount involved in this 
    18                  transaction?
    19              A   There was $20,000 and 7,500 of it went to Mrs. 
    20                  Thomas to cover past debts and bills inside my 
    21                  office, and if I take it a moment to explain 
    22                  that.  There is a thin line between political 
    23                  activity and being leader of the opposition.  The 
    24                  line has never been fully clarified.  You have to 
    25                  rely on your own judgment whether or not you're 
 0076

     1                  going to use public funds for what may be a 
     2                  political nature of mailing or series of letters 
     3                  or anything related to that, or you have to use 
     4                  private funds.  I was very scrupulous, and this 
     5                  was before the time of the current auditor 
     6                  general, where the liberal party, for example, 
     7                  provincially sent out a mailing and it was their 
     8                  judgment that the mailing was non-political and 
     9                  fully justified for the use of the public funds.  
    10                  The public -- the auditor reviewed it and said it 
    11                  was in a gray area and he recommended that the 
    12                  liberal party pay the money back to the 
    13                  government.  That's a standing case.  That was 
    14                  the first time and in B.C. history that a third 
    15                  party was called in to view a decision around 
    16                  spending public funds. 
    17                       My responsibility was to determine if an 
    18                  expenditure out of my office was purely political 
    19                  then it should be paid by me or funds that I 
    20                  gathered to pay for.  I was very scrupulous about 
    21                  that and we had accumulated through my own money 
    22                  in the fund and Mrs. Thomas also put her money in 
    23                  as well as sometimes Mr. Beach, something that I 
    24                  discourage very much, but anyway there were a 
    25                  total of about 4,000 or a little over 4,000 
 0077

     1                  without standing bills.  When the 20,000 came to 
     2                  me I gave Ms. Thomas 7,500 to pay off those back 
     3                  debts and leave some cash in hand, the rest of 
     4                  the money I turned over to the Nanaimo 
     5                  Commonwealth Holding Society for them to use. 
     6              Q   And the money was given to you for what purpose?
     7              A   For anything that I wanted to use it for.  It was 
     8                  a political donation. 
     9              Q   Were there any conditions to that donation?
    10              A   No, no conditions to the donation. 
    11              Q   Why didn't you give the 12,500 to the New 
    12                  Democratic Party as opposed to the NCHS?
    13              A   It was my decision to give it to the Nanaimo 
    14                  Commonwealth Holding Society.  I knew that -- and 
    15                  I trusted Mr. Stupich completely and I knew that 
    16                  the money would be used for purposes of party 
    17                  purposes, and it was a choice that I made.
    18              Q   Was the whole 20,000 in $50 bills?
    19              A   Yes, it was.
    20              Q   And when did you receive it?
    21              A   I don't know the exact date but it was after the 
    22                  election.
    23              Q   I'm sorry, the election was?
    24              A   The election was in the spring of '83.
    25              Q   So did you deposit the money into your bank 
 0078

     1                  account?
     2              A   No, I did not.
     3              Q   Where did you keep it?
     4              A   As soon as I received it I gave Mrs. Thomas 
     5                  $7,500 and sent the rest off to the Nanaimo 
     6                  Commonwealth Holding Society.
     7              Q   How did you send it?
     8              A   I don't remember exactly, either Mr. Beach might 
     9                  have taken it up or -- I don't remember exactly.  
    10                  But it was done.
    11              Q   How big is 250, $50 bills?
    12              A   I've only seen it once.
    13              Q   I've never seen it.  How big is it?
    14              A   I can't recall.  It was a substantial package but 
    15                  it wasn't a huge, you know.
    16              Q   Right.  Were you concerned about safety issues 
    17                  around having so much cash?
    18              A   Absolutely.  I didn't want it around and I wanted 
    19                  it up to Nanaimo.
    20              Q   So did you take it up?
    21              A   I don't recall.  I don't know if I did or Mr. 
    22                  Beach did. 
    23              Q   Why not deposit the money in a bank account and 
    24                  then write Joyce Thomas and the Holding Society a 
    25                  cheque it would have been safer, wouldn't it?
 0079

     1              A   Well, Mrs. Thomas had bills to pay off so I just 
     2                  gave her the cash.  We had no account.  We ran a 
     3                  small petty cash as every office does but we 
     4                  didn't have a bank account for petty cash.
     5              Q   But it was given to you?
     6              A   The money was given to me, I gave Mrs. Thomas 
     7                  7,500 and the rest of it went up to Nanaimo 
     8                  Commonwealth Holding Society.
     9              Q   Just from a security point of view, did it not 
    10                  occur to you to deposit the money into your bank 
    11                  account and write a cheque?
    12              A   No I was not going to deposit that money in the 
    13                  bank account.  I was going to put it into Nanaimo 
    14                  Commonwealth Holding Society.  I did not want the 
    15                  money for personal use.  The money was given to 
    16                  me without any condition whatsoever.
    17              Q   So why not give it to the New Democratic Party?
    18              A   It was my choice to give it to the Nanaimo 
    19                  Commonwealth Holding Society.
    20              Q   And did you expect it to be used for the purposes 
    21                  of the Holding Society or did you expect it to be 
    22                  used --
    23              A   The education for democratic socialism. 
    24              Q   Is it your understanding that the money came from 
    25                  an individual; is that right?
 0080

     1              A   It was an individual.
     2     MS. SMITH:  All right.  Mr. Commissioner I have spoken with 
     3                  Mr. Leask and I think for the record I should 
     4                  just indicate that I have been advised of the 
     5                  identity of the individual.  I have advised you 
     6                  and that independent of input or consideration 
     7                  from you I have assessed the information that 
     8                  I've received from Mr. Leask in the context of 
     9                  our terms of reference and there's no indication 
    10                  that it relates to either charitable proceeds of 
    11                  gaming or society assets.  I'm convinced that or 
    12                  content that it is not relevant to the terms of 
    13                  reference and in the context of this inquiry we 
    14                  he have deleted I've ensured that personal home 
    15                  phone numbers of citizens have been deleted in 
    16                  recognition of a privacy interest of citizens who 
    17                  are brought into this very public forum and given 
    18                  my analysis I'm not going to ask this witness to 
    19                  disclose the identity of the donor.  I just don't 
    20                  see it fitting within our terms of reference.  I 
    21                  appreciate that there would be people who are 
    22                  curious but I don't see it as being relevant, so 
    23                  I'm not going to ask the question.
    24     THE COMMISSIONER:  Well far be it from me to comment on the 
    25                  propriety of private political donations but what 
 0081

     1                  I can comment on is the terms of reference of 
     2                  this inquiry and the propriety of privacy of 
     3                  political donations is not part of our terms of 
     4                  reference, and I will not require the identity of 
     5                  the donor be disclosed at this time, subject to 
     6                  any comments that any other counsel or 
     7                  participants have, and hearing none I think we 
     8                  can just leave it there.
     9     MS. SMITH: 
    10              Q   By giving the money to the Holding Society as 
    11                  opposed to the party, was there an ancillary 
    12                  benefit, and by that I mean avoiding, for 
    13                  example, a restriction --
    14              A   No, no.  The -- I made a judgment call that the 
    15                  money should go to the Nanaimo Commonwealth 
    16                  Holding Society.
    17              Q   By 1983 we know that the Holding Society was in 
    18                  dire financial straits as a result of real estate 
    19                  projects.  Were you aware of that?
    20              A   I was aware that they were having problems in 
    21                  refinancing the project that they were involved 
    22                  in, but that had no bearing on my decision to put 
    23                  the money there.
    24              Q   On the issue of the financial straits of the 
    25                  Holding Society, and given your friendship with 
 0082

     1                  Mr. Stupich, did you discuss with him the 
     2                  problems that he was experiencing which included 
     3                  debt to members of the his constituency?
     4              A   Mr. Stupich is a very close person, he will only 
     5                  discuss matters that he wants to discuss 
     6                  particularly of a personal nature or if he 
     7                  interprets it as a personal nature.  I never 
     8                  inquired or did he ever discuss with me the 
     9                  nature of those things.  I was curious and I was 
    10                  concerned.
    11              Q   All right.  In -- my understanding again of what 
    12                  happened in your life is that after you were with 
    13                  leader of the party you then went and worked in 
    14                  radio for a period of time?
    15              A   And then I went back to academia, I was a fellow 
    16                  at the school of politics Jeff Kennedy school of 
    17                  politics, Harvard University, I then became a 
    18                  visiting scholar at McGill, I picked up my 
    19                  academic background which is not an asset in B.C. 
    20                  politics at that particular time.  And I did a 
    21                  number of other things.  My last academic stint 
    22                  was as a visiting school or with the University 
    23                  of western Washington, I did a paper to deliver 
    24                  at a conference in Texas, the impact of NAFTA on 
    25                  labor markets in North America.
 0083

     1              Q   You returned to the political arena as I 
     2                  understand it in the late '80?
     3              A   That's right in 1988 I ran federally.
     4              Q   And how did that come to pass?
     5              A   Well, I had thought that I was through with 
     6                  public life and on with other parts of my life.  
     7                  I happen have been very, very fortunate enjoying 
     8                  an extremely happy private life which is rare in 
     9                  public life, that is, to keep it private.  I did 
    10                  not really want to go back, but I had been very 
    11                  concerned about the North American Free Trade 
    12                  Agreement and I decided to stand for office 
    13                  opposing that treaty as my principal reason for 
    14                  returning to politics.
    15              Q   And did you discuss this return to politics with 
    16                  Mr. Stupich?
    17              A   Yes, I did.  He was interested in running as an 
    18                  -- a he subsequently did run and he was one who 
    19                  amongst others who asked me to consider running 
    20                  again.
    21              Q   All right.  Now to run for the federal position 
    22                  requires financing; is that right?
    23              A   Yes.  We had campaign funds set up as required by 
    24                  federal legislation.
    25              Q   Now, are there restrictions on campaign expenses 
 0084

     1                  in the federal sphere?
     2              A   Yes, there are in the federal and full 
     3                  disclosure.
     4              Q   Now, there are some financial records in the 
     5                  document book that aren't as helpful as a few 
     6                  others that I've pulled out so I'm going to ask 
     7                  that this packet be marked as the next exhibit, 
     8                  please. 
     9     THE REGISTRAR: Exhibit 224.
    10                  (Exhibit 224:  Packet of documents)
    11     THE COMMISSIONER:  224 thank you.
    12     MS. SMITH: 
    13              Q   And this is actually a copy of the Exhibit 84 
    14                  that was discussed with Mr. Allan when he was 
    15                  here.  And this is a printout, the copy of the 
    16                  books and records of NCHS got computerized at a 
    17                  point in time and we now have records that are 
    18                  computer generated as opposed to Mr. Stupich's 
    19                  handwriting but these have been identified as 
    20                  coming from the general ledger of the Marwood 
    21                  Services Limited.  And if you turn to page 3 of 
    22                  this exhibit there is the general ledger from 
    23                  Marwood as of December 31, 1989 and the account 
    24                  number 1068, if you look on the left-hand at the 
    25                  top of the page you'll see account code?
 0085

     1     THE COMMISSIONER:  Is this page numbered 371 at the bottom? 
     2     MS. SMITH:  Yes thank you.
     3              A   Yes, I have it.
     4              Q   And you'll see account code 1068 and then there's 
     5                  33 for department code and then it says accounts 
     6                  REC,D Barrett.
     7              A   Yes.
     8              Q   Okay.  And if you drop down we have heard from 
     9                  Mr. Allan that the first relevant entry here for 
    10                  our purposes in relation to you is the bottom 
    11                  entry with regard to that account and that is 120 
    12                  and then it says December 31, '89 A/REC Barrett 
    13                  campaign.
    14              A   That's right.
    15              Q   $43,244.69.
    16              A   Yes.
    17              Q   And that's receivable by Marwood from you.
    18              A   Yes.
    19              Q   And then if we switch over to the page 4 which 
    20                  there should be a handwritten 4 in a circle the 
    21                  next page.
    22              A   Right.
    23              Q   There is a year-end change for the Marwood 
    24                  Services, so this is the period up to July 31, 
    25                  1990 and if you drop down a quarter of the way 
 0086

     1                  down the page we again see the 1068?
     2              A   Yes.
     3              Q   And 33 department accounts receivable Dave 
     4                  Barrett.
     5              A   Right.
     6              Q   And they are a couple of adjustments and then we 
     7                  have got an opening balance on the right-hand 
     8                  side of $45,479.69, do you see that?
     9              A   Yes.
    10              Q   And so the records indicate that you owed Marwood 
    11                  approximately $45,500 in 1989, is that correct?
    12              A   That's correct.
    13              Q   All right.  Can you tell us, please, how that 
    14                  loan came to be arranged?
    15              A   I had decided belatedly to run for the federal 
    16                  leadership of the New Democratic Party, 16 of my 
    17                  colleagues in Ottawa had signed a public 
    18                  statement asking me to run.  I write about it a 
    19                  bit in the book.  And once having decided to run 
    20                  I was late in entering and Mr. Stupich through 
    21                  Nanaimo Commonwealth Holding Society loaned the 
    22                  campaign just under $50,000 and that was paid 
    23                  back within a matter of weeks that from funds 
    24                  that we collected one the campaign started.  It 
    25                  was a regrettable misinterpretation of that facts 
 0087

     1                  by the forensic auditor Mr. Parks, but 
     2                  fortunately we straightened that out.
     3              Q   Now, you said that the loan that DDS loan -- 
     4                  sorry Mr. Stupich loaned the campaign through 
     5                  NCHS.
     6              A   That's what I thought.
     7              Q   All right.  So you spoke to Mr. Stupich about --
     8              A   Mr. Stupich said that he would put up $50,000 to 
     9                  get the campaign started so we could start 
    10                  raising money immediately but we will expenses 
    11                  immediately for the campaign.  I don't think that 
    12                  that loan lasted more than 10 days. 
    13              Q   Just before we get into the repayment, did you 
    14                  discuss with Mr. Stupich where he would get 
    15                  $50,000 to support your campaign?
    16              A   No, I assumed that he had -- he was the with one 
    17                  that made the offer I assumed that he had in the 
    18                  Nanaimo Commonwealth Holding Society.  I had no 
    19                  reason not to believe that it wasn't for the 
    20                  campaign.  It was his suggestion and I certainly 
    21                  agreed with it.
    22              Q   Did you understand that the monies would be from 
    23                  donations for the NDP or funds raised by the 
    24                  Holding Society independent or --
    25              A   My assumption was it was funds already existing 
 0088

     1                  in the Nanaimo Commonwealth Holding Society 
     2                  otherwise I could have easily gone to the bank 
     3                  and borrowed 50,000 for the campaign, had my 
     4                  committee do that.
     5              Q   And that's what other people running in this 
     6                  campaign would have done?
     7              A   Would have done, but we were in a hurry up catch 
     8                  up situation and I didn't go it another thought.  
     9                  I knew that we would be able to raise money very 
    10                  quickly and we did raise the money very quickly.
    11              Q   How did you receive the money?
    12              A   I never received the money.  It was in the hands 
    13                  of the campaign committee.
    14              Q   Are you aware of any arrangement to pay interest 
    15                  on the money?
    16              A   Sorry? 
    17              Q   Do you know whether you made interest on the 
    18                  money?
    19              A   I have no idea.  Because the campaign had started 
    20                  late, everything was thrown together as quickly 
    21                  as possible.  I was on the road almost 
    22                  immediately within 24 hours of my announcement I 
    23                  was already out to the constituencies campaigning 
    24                  for votes so the campaign committee handled all 
    25                  of those details.
 0089

     1              Q   The records that we have got indicate that 
     2                  repayment was completed at the end of July 1990.  
     3                  If you look at pages 4 and 5 of the exhibit we 
     4                  have got the opening balance of the $45,479, and 
     5                  then there is a series of deposits made, you can 
     6                  see on the 25th of January, 15,500, 29, of 
     7                  January, 10,000, then there's some monies paid 
     8                  out and it's over a series of transactions and 
     9                  months.
    10              A   Yes.
    11              Q   To July of 1990 that the money in fact is repaid.  
    12                  Why did you say that it was your view --
    13              A   Well, I was under the impression it was paid back 
    14                  immediately.  I had never heard any complaints or 
    15                  any concerns about the money being paid back.  I 
    16                  know that money was flowing into the campaign 
    17                  coffers very quickly.  It may have been that some 
    18                  of the bills were with delayed or something.  I 
    19                  don't know the answer to that.
    20              Q   It was you and Mr. Stupich that arranged for this 
    21                  funding of your campaign; is that right?
    22              A   Mr. Stupich became the campaign manager for funds 
    23                  and we did receive a lot of money very quickly 
    24                  once we got started.
    25              Q   When you say he became the campaign manager for 
 0090

     1                  funds --
     2              A   He did the accounting.
     3              Q   Was he the one -- was there anyone else who was 
     4                  ensuring or controlling the repayment of these 
     5                  funds other than Mr. Stupich?
     6              A   No, I had complete trust in Mr. Stupich to do 
     7                  that.  There was no reason for me not the trust 
     8                  him.
     9              Q   As the campaign manager of funds, was there any 
    10                  need for anybody other than you and Mr. Stupich 
    11                  to be aware of this arrangement?
    12              A   You mean about the borrowing of the money to 
    13                  launch the campaign? 
    14              Q   Yes.
    15              A   Well, if anybody asked we would have told them.
    16              Q   But are you aware of anybody --
    17              A   I don't know if anybody asked.  Everything was 
    18                  transparent.  We had a limited amount of money to 
    19                  spend, there was a budget limit imposed by the 
    20                  party itself on the candidates.
    21     MS. SMITH:  I note the time.  I'm wondering if this is an 
    22                  appropriate time for lunch and I can indicate 
    23                  that I will finish clearly with Mr. Barrett 
    24                  today.
    25     THE COMMISSIONER:  All right, we'll adjourn to two o'clock. 
 0091

     1     THE REGISTRAR: All rise.
     2                  (LUNCHEON ADJOURNMENT)
     3     THE REGISTRAR: All rise. 
     4     MS. SMITH: 
     5              Q   Mr. Barrett I've just got a couple of more areas 
     6                  to cover with you and one of them relates to 
     7                  items addressed in the second page of the 
     8                  document that appears at tab 40 sorry it's 
     9                  actually the third page, the first page is a 
    10                  letter from Mr. Parks dated the 28th of April, 
    11                  1985.
    12              A   Yes.
    13              Q   To Mr. Perry who acted for you I understand and 
    14                  if you direct your attention to the third page 
    15                  started with New Democratic Party accounts at 
    16                  NCHS.
    17              A   Yes.
    18              Q   And this is an issue that is raised at page 108 
    19                  of the Parks report and in their investigation 
    20                  the accountants located some transactions and Mr. 
    21                  Parks summarized it in the first paragraph of 
    22                  this third page at tab 40, he says the:
    23                       The NCHS records show that the provincial 
    24                       New Democratic Party maintained accounts 
    25                       at NCHS to receive donations and pay 
 0092

     1                       expenses transfers from these accounts 
     2                       were made to Dave -- Mr. David Stupich 
     3                       the treasurer of the NCHS at the time in 
     4                       both 1984 and 1985.  The accounting 
     5                       entries initiating the transfers refer to 
     6                       authorization from DB".
     7                  Whom we understand to be Mr. Barrett based on 
     8                  other similar notations elsewhere in the 
     9                  accounting records.  An example is attached.
    10                  And the first question that he poses is:
    11                       With respect to the transfer of $1,861.70 
    12                       to Mr. Stupich's account in 1984 can Mr. 
    13                       Barrett confirm his involvement in the 
    14                       fund raising activity that the journal 
    15                       entry suggests was conducted by Mr. 
    16                       Barrett to assist Mr. Stupich in clearing 
    17                       a deficit resulting from Mr. Stupich's 
    18                       campaign for the leadership of the 
    19                       provincial NDP.
    20                  And just so that you know, at page 109 of the 
    21                  Parks report the journal entry is quoted and what 
    22                  it says is:
    23                       Funds raised by DB committed to pay off 
    24                       L/ship campaign deficit.
    25                  Now, there is a response provided at tab 41 at 
 0093

     1                  page 2 and it says:
     2                       Mr. Barrett has no specific recollection of 
     3                       this transfer or an involvement in fund 
     4                       raising activity.
     5                  And then it goes on to say that you've been 
     6                  signatory to a large number of fund raising 
     7                  letters and it's possible that the funds referred 
     8                  to in this question were raised as a result of 
     9                  such a fund raising letter.
    10                       Were you aware of this transfer of funds 
    11                  from the NDP accounts at NCHS to the benefit of 
    12                  Mr. Stupich?
    13              A   I'm aware that after writing this letter I was -- 
    14                  recall that I had raised some money from Mr. 
    15                  Stupich's campaign and I directed the money to 
    16                  the Nanaimo Commonwealth Holding Society.  I made 
    17                  no transfers, I had no authority to make any 
    18                  transfers or anything else, I just directed the 
    19                  money to Mr. Stupich.
    20              Q   And there's a similar transfer in 1985 and the 
    21                  net effect is that Mr. Stupich's loan to NCHS is 
    22                  reduced by $45,963 and the amount of money to the 
    23                  NDP's credit at NCHS is also reduced by that 
    24                  amount.  Do you have any knowledge of that 
    25                  transaction?
 0094

     1              A   Could you tell me the date again and what the 
     2                  notation is on it? 
     3              Q   This is in 1985 and the notation is it's a 
     4                  journal entry with respect to the DDS campaign 
     5                  account and it says:
     6                       To credit DDS with balance remaining in 
     7                       L/ship account partial discovery of 
     8                       expenses paid by DDS.
     9                  And then the journal entry in the NDP accounts 
    10                  is:
    11                       Funds turned over to DDS by DB.
    12                  And this would have been 1985.
    13              A   No, I have no knowledge of that.
    14     THE COMMISSIONER:  Ms. Smith before you go on to another 
    15                  matter, Mr. Barrett, earlier today you had said 
    16                  that you had some concerns taken with the 
    17                  approach of Mr. Parks and that you had spoken 
    18                  with him and cleared that up.
    19              A   Yes.
    20     THE COMMISSIONER:  Was that after before he issued his report 
    21                  so that that mistaken approach in your view is 
    22                  not perpetuated in the report?
    23              A   I think so.
    24     THE COMMISSIONER:  You don't have to go into it, I was just 
    25                  going to give you an opportunity to clear the 
 0095

     1                  record on that issue if you wanted to.
     2              A   I'm satisfied that the matter is cleared, but I 
     3                  was very upset at the time and I'm satisfied that 
     4                  Mr. Parks clarified it and changed where he was 
     5                  coming from.
     6     THE COMMISSIONER:  All right and then the second matter in 
     7                  respect of this letter is that in paragraph 4 at 
     8                  tab 41 the response provided by Mr. Perry 
     9                  apparently on your behalf is that -- I'm sorry I 
    10                  misread it, it says that he felt he should 
    11                  receive interest on the funds held for him, 
    12                  that's Mr. Williams speaking, that's not your 
    13                  view?
    14              A   No.
    15      THE COMMISSIONER:  So there was nothing inconsistent with 
    16                  this response with what you've said today?
    17              A   No.
    18     MS. SMITH: 
    19              Q   Now, I just want to return to Exhibit 23 which is 
    20                  the February 27, 1984 article.
    21              A   Thanks.
    22              Q   Now, the six people photographed in this article, 
    23                  they are all NDP members; is that right?
    24              A   Yes.
    25              Q   They are all hopefuls to become the leader of the 
 0096

     1                  NDP?
     2              A   Yes.
     3              Q   Now, we know through the evidence of the 
     4                  accountants and the document that we have looked 
     5                  at that the Holding Society made payments to the 
     6                  benefit of Mr. Stupich, also payments related to 
     7                  Mr. King and we know that payments were made to 
     8                  your benefit, so as far as individuals we have 
     9                  got that.  We also know that there were funds 
    10                  paid to various constituencies.  But we haven't 
    11                  seen any evidence that four of the six NDP party 
    12                  members described here as running for the 
    13                  leadership position in 1984 received funding from 
    14                  the Holding Society.  You don't have any 
    15                  knowledge for example Mr. Vickers, Mr. Skelly, 
    16                  Mr. Lea or Mr. Burrill received funds from the 
    17                  Holding Society, do you?
    18              A   No.  I don't.  But I made it very clear that I 
    19                  would attempt to help any one of the leadership 
    20                  candidates, not any one but four of the six I 
    21                  indicated that I -- if they wanted me to I would 
    22                  sign a letter to help them raise money. 
    23              Q   From an outsider it looks as though Mr. King and 
    24                  Mr. Stupich arguably have a financial advantage 
    25                  having the Holding Society in the position that 
 0097

     1                  it was, would you agree with that?
     2              A   I don't know the circumstances of the nature of 
     3                  the funds that they were paid with, so I can't 
     4                  say if I agree or disagree.  If someone raised 
     5                  money for them that went through the fund then --
     6     THE COMMISSIONER:  Did you ever take steps with Mr. Stupich to 
     7                  ensure an equitable distribution of funds raised 
     8                  for political purposes?
     9              A   I raised money for Mr. Stupich, I signed a letter 
    10                  for Mr. Stupich.  I would have signed a letter 
    11                  for other candidates had had he asked.
    12     THE COMMISSIONER:  Sorry, I expressed that badly.  In the fund 
    13                  raising that you did where you turned money 
    14                  raised for the NDP over to NCHS, did you ever 
    15                  seek assurances or require measures to be put in 
    16                  place where would ensure an equitable 
    17                  distribution of those funds for all members of 
    18                  the NDP?
    19              A   No, I never discussed that.  I just raised the 
    20                  funds for the Nanaimo Commonwealth Holding 
    21                  Society. 
    22     THE COMMISSIONER:  All right.
    23     MS. SMITH: 
    24              Q   Now, Mr. Stupich was accountable to no one with 
    25                  regard to these funds; is that correct?
 0098

     1              A   Not to my knowledge, except there was a board on 
     2                  the Nanaimo Commonwealth Holding Society but I, 
     3                  you know, I assume that the board met and was 
     4                  responsible. 
     5              Q   If a person characterized the monies held at NCHS 
     6                  that had been donated to the New Democratic 
     7                  Party, if a person characterized that as a hidden 
     8                  slush fund for very senior members of the New 
     9                  Democratic Party would you agree with that 
    10                  characterization or would you disagree?
    11              A   No.
    12              Q   And why would you disagree?
    13              A   Because it wasn't hidden.  I was aware of it, I 
    14                  can't speak for others, but they all knew that 
    15                  Nanaimo Commonwealth Holding Society was 
    16                  established for democratic socialist education 
    17                  purposes and that also meant, as I understood it, 
    18                  to assist the New Democratic Party and I can't 
    19                  speak for others.  I knew it and it's difficult 
    20                  for me to believe that others did not know it as 
    21                  well.
    22              Q   Did it ever occur to you that given that you 
    23                  identified Mr. Stupich as being pivotal and 
    24                  perhaps instrumental in the decisions of the 
    25                  Holding Society, and given the limited 
 0099

     1                  accountability of which you were aware, is that 
     2                  fair that you were aware of --
     3              A   I didn't ask.  I had no reason.  I trusted Mr. 
     4                  Stupich.  And there was no reason for me in my 
     5                  experience not to trust him.
     6              Q   So it didn't occur to you that this arrangement 
     7                  of monies deposited with the Holding Society that 
     8                  didn't appear anywhere for example on the New 
     9                  Democratic books could lead to mischief or 
    10                  temptation?
    11              A   I never second guess human behavior.  I have 
    12                  worked with a lot of people in my life.  This was 
    13                  an instrument as I stated at the outset where 
    14                  people who did not wish to be known could give 
    15                  money to the New Democratic Party for socialist 
    16                  education as they or I defined it.  And I had no 
    17                  reason to ask Mr. Stupich whether or not he was 
    18                  trustworthy.
    19              Q   Did you know anything about the charity fund 
    20                  raising that went on at the Holding Society?
    21              A   No.  I have no knowledge of that.  I knew that 
    22                  there was -- that the Nanaimo Commonwealth 
    23                  Holding Society ran bingo, but that was the 
    24                  extent of my knowledge.
    25              Q   You understand the terms of reference of this 
 0100
 

     1                  inquiry, do you?
     2              A   Yes, I do.
     3              Q   All right.  I've asked you a series of specific 
     4                  questions.  Are you aware of anything that we 
     5                  should know about given the terms of reference 
     6                  that I haven't asked you about?
     7              A   I can't think of anything.
     8     MS. SMITH:  Thank you, those are my questions of this witness.
     9     THE COMMISSIONER:  Thank you.  Mr. Leask, do you want to wait 
    10                  and if see if they are other questions from other 
    11                  counsel if?
    12     MR. LEASK:  Thank you, I will.
    13     MR. BETHELL:  No, thank you.
    14     THE COMMISSIONER:  Mr. Lewis? 
    15     MR. LEWIS: 
    16              Q   Mr. Barrett, my name is Geoffrey Lewis I act as 
    17                  counsel for the British Columbia Gaming 
    18                  Commission.
    19              A   Yes.
    20              Q   And the question -- series of questions I have 
    21                  for you relate really to your experience with 
    22                  public policy and the history of gaming in the 
    23                  province.
    24              A   Mh-hmm.
    25              Q   In the period of your government 1972 to 1975, 
 0101

     1                  and then through the '70s as leader of the 
     2                  opposition, say up until 1980 or so, do you 
     3                  recall gaming being a significant matter for the 
     4                  government either in terms of regulation or 
     5                  revenue?
     6              A   For the government? 
     7              Q   Yes.
     8              A   Yes.  Regretfully I authorized the first lottery 
     9                  structure in British Columbia.  It was much to my 
    10                  policy regret that we were instrumental in 
    11                  establishing the 649 program, the scratch and win 
    12                  programs, this was in response at the time to the 
    13                  amount of money that was leaving Canada with the  
    14                  Irish sweepstakes which was substantial. 
    15                       On reflection of these past years I think it 
    16                  was a mistake that I made in my government made 
    17                  along with the other governments that allowed the 
    18                  development of the lotteries corporation.  And I 
    19                  regret this.  Nothing that I can do will change 
    20                  it but I was instrumental in making that decision 
    21                  and we were instrumental in setting up the first 
    22                  lotteries across Canada.
    23              Q   In comparison to the types of revenues and the 
    24                  types of activity that exists today would you say 
    25                  it's fair to characterize the level of activity 
 0102

     1                  in the '70s as being just a shadow of what it is 
     2                  today?
     3              A   It certainly is a shadow of what it is today and 
     4                  but however, it was the embryo that's grown in a 
     5                  monster in my opinion.
     6              Q   In that embryonic stage in the '70s do you recall 
     7                  that the federal government, no doubt you do 
     8                  recall that the federal government was active in 
     9                  the field at that time?
    10              A   They were active in the field too as well as a 
    11                  number of other provinces.
    12              Q   And one example that anyone might recall was that 
    13                  the Super Lotto was introduced to help in part 
    14                  fund the Montreal Olympics.  Do you recall that?
    15              A   I recall that.  I must add that when we had the 
    16                  opportunity to bid for the winter Olympic games 
    17                  in British Columbia I made a statement that our 
    18                  government would not support a bid for those 
    19                  Olympics because of the financial cost and 
    20                  because of the financing that North America was 
    21                  moving into, not just Canada but the United 
    22                  States, in terms of the financing those kind of 
    23                  operations.
    24              Q   All right.  In the relationship of the federal 
    25                  government with the provincial governments and 
 0103

     1                  the identification of source of revenue, sources 
     2                  of taxation sources of levies, am I right in 
     3                  understanding that in our constitutional system 
     4                  the way to governments work in Canada that 
     5                  generally the provinces and the federal 
     6                  government vie for control over sources of 
     7                  revenue with each other?
     8              A   Well, I don't know if I could use the word vie, I 
     9                  mean, there are competing interests for revenues 
    10                  sources but that's the nature of the B NA and 
    11                  constitution itself.  When someone is a 
    12                  provincial politician they think that their 
    13                  jurisdiction is paramount in some areas when one 
    14                  is a federal politician they think that their 
    15                  position is paramount.  The taxpayer has to pay 
    16                  no matter whose position is paramount but there 
    17                  is competition obviously and niches and in 
    18                  general policy.
    19              Q   In 1985 do you recall, and I appreciate at this 
    20                  time that you were no longer a sitting member of 
    21                  the legislature.
    22              A   Yes.
    23              Q   But do you recall that in connection with the 
    24                  funding for the Calgary winter Olympics that John 
    25                  Turner made a deal with the provinces that 
 0104

     1                  resulted in the federal government agreeing to 
     2                  withdraw from the field of gaming?
     3              A   I knew that Mr. Turner was considering that.  I 
     4                  must say that I enjoyed extremely positive 
     5                  relationship with Mr. Turner when he was federal 
     6                  Minister of Finance, he was a very reasonable 
     7                  honourable person and we did have generalized 
     8                  discussions about whether lottery funds where 
     9                  going because I was a Minister of Finance 
    10                  provincially at the same time.  But as far as the 
    11                  Calgary decision it was of no import to me at 
    12                  that time.
    13              Q   All right.  The result in -- I'll tell you 
    14                  because I know -- that was that the Criminal Code 
    15                  was amended and the permissive sections of the 
    16                  Criminal Code that permit gaming to occur and not 
    17                  be a criminal offence included prior to that time 
    18                  among other exceptions but the principal ones 
    19                  were gaming conducted on behalf of the Federal 
    20                  Crown, gaming conducted on behalf of the 
    21                  provincial crown?
    22              A   Mh-hmm.
    23              Q   And then the charitable exception that gave rise 
    24                  to raffles and bingo and casino and we see exist 
    25                  in the province today in addition to what the 
 0105

     1                  provincial government operates through the 
     2                  lottery corporation.
     3              A   Yes.
     4              Q   And so in 1985 in return for a funding 
     5                  arrangement and I don't mean this in terms of a 
     6                  contract but there was an arrangement made with 
     7                  the provinces that saw an undertaking and 
     8                  obligation to funneled the winter Olympics in 
     9                  Calgary and the federal government at least 
    10                  withdrew itself from the field?
    11              A   Mh-hmm.
    12              Q   Would you agree with the characterization that 
    13                  had the federal government at that time 
    14                  appreciated the many billions of dollars of 
    15                  revenue which are now drawn both to the 
    16                  charitable sector on the provincial government 
    17                  sectors across the country annually, that they 
    18                  wouldn't have withdrawn from the field completely 
    19                  at the price they did had they foreseen what a 
    20                  large economic force gaming was to become?
    21     MS. SMITH:  How can that witness answer that question.
    22              A   Well --
    23     MR. LEWIS:  Given his experience.
    24              A   It's impossible for me to answer that question.  
    25                  Gambling has become so seductive in North America 
 0106

     1                  for governments and if I may take off a political 
     2                  hat and put on a social scientist hat I lament 
     3                  very much this dream machine that had been 
     4                  created by the monster. 
     5                       There was a study recently showing that 
     6                  almost one-third of Canadians buy lottery tickets 
     7                  in hopes f winning enough for their retirement 
     8                  rather than save through the RRSPs or other 
     9                  means.  In hindsight -- hindsight is always very 
    10                  good, in terms of hindsight on policy I've 
    11                  already said early on I regretted very much the 
    12                  move that I made.  But for governments to regret 
    13                  it today is for governments to cut off an 
    14                  umbilical cord with a monster that provides them 
    15                  money.
    16              Q   My question isn't addressed to the policy choice 
    17                  in an altruistic tense or in the sense of the 
    18                  pure exercise of legislative power or public 
    19                  policy choice, it's directed to the knowledge of 
    20                  people in the 1980s about looking forward as to 
    21                  whether or not in government at that time there 
    22                  was an appreciation of what was to come.
    23              A   I can only make the generalized response to that 
    24                  question.  There are very few reflective moments 
    25                  in government around finance.  We have a very 
 0107

     1                  antiquated financing situation of annual budgets, 
     2                  no corporation could possibly operate that way 
     3                  and because of the pressure of annual budgets 
     4                  governments are focussed on problems of the day, 
     5                  the 12 months, the 12 months, the 12 months. 
     6                       Until we move, in my opinion, to a system of 
     7                  projecting -- (thunder) -- there seems to be 
     8                  other people who agree with me or disagree, I'm 
     9                  not quite sure -- but until we move to a system 
    10                  of three year or five year public budget 
    11                  projections the choice of you're asking in terms 
    12                  of an opinion for a politician is too narrow.  
    13                  They are under the pressure to meet the current 
    14                  demand, and it's a matter of great public debate.  
    15                  I don't think it belongs to any political party, 
    16                  it's just a matter of public debate.
    17              Q   Frank Rhodes who I'm sure you know --
    18              A   An outstanding civil servant.
    19              Q   -- sat in the witness seat before this inquiry in 
    20                  relation to his role as a deputy minister with 
    21                  responsibility which covered the creation of a 
    22                  new regulatory regime for gaming in the mid 
    23                  1980s.
    24              A   Yes.
    25              Q   He characterized the situation which he 
 0108

     1                  confronted in 1986 as a tidal wave of economic 
     2                  activity overwhelming an ill equipped, ill 
     3                  prepared regular story staff, a very small 
     4                  regulatory staff for both the lotteries branch 
     5                  which was dealing with the ticket lotteries, what 
     6                  later became the lottery corporation, but also 
     7                  the licencing authority for charitable gaming.  
     8                  And it's just to this question of expectation 
     9                  that it would be unfair perhaps to attach too 
    10                  much criticism for the lack of preparation for 
    11                  the enormous expansion in the activity because 
    12                  generally people didn't see it coming.
    13              A   It's only my opinion, first of all I have 
    14                  tremendous respect for Mr. Rhodes, he was the 
    15                  epitome of what a civil servant can and should be 
    16                  and he was unhesitating in presenting his views 
    17                  and disagreements and that's an admirable trait 
    18                  for someone in the kind of job that he had. 
    19                       No, I don't think that I could have seen it.  
    20                  There is a book by a gentleman by the name of 
    21                  Alan Karcher, K-a-r-c-h-e-r, who was a former 
    22                  speaker of the house of New Jersey who had been a 
    23                  very strong advocate of gaming and I have been -- 
    24                  go along with the idea of advocate. 
    25                       Mr. Karcher, I met Mr. Karcher on a number 
 0109

     1                  of occasions, we spent time at Harvard together 
     2                  at the Kennedy school government and he was 
     3                  writing his book at that time and that's what 
     4                  brought into focus for me on reflection of the 
     5                  kind of facts that he was dealing with, the 
     6                  impact on his state New Jersey, the impact of 
     7                  other states, and I realized that what you've 
     8                  described was taking place, it was an explosion 
     9                  of lack of regulation, lack of awareness of the 
    10                  social impact, seductiveness now of machines far 
    11                  beyond the kind of capacity to raise money than 
    12                  just scratching something.  It's a serious 
    13                  problem and I don't know if -- fortunately 
    14                  Canada's regulatory bodies have never been 
    15                  involved in any scandal that I'm aware of it, I 
    16                  cannot say that for every jurisdiction in the 
    17                  United States to my knowledge. 
    18              Q   And I take it from your initial response to this 
    19                  series of questions that had you known the nature 
    20                  of the jeannie you never would have assisted in 
    21                  getting it out of the bottle?
    22              A   Let me put it this way, I would have listened to 
    23                  my wife.
    24              Q   That's probably very good advice for all of us.
    25              A   And now I've said it publicly.
 0110

     1     MR. LEWIS:  Thank you very much.
     2     THE COMMISSIONER:  Mr. Bethell?
     3     MR. BETHELL:  Nothing.
     4     MS. SMITH:  Sorry, Mr. Leask and I have had a quick chat.  Mr. 
     5                  Lewis's questions included the word "raffle" 
     6                  which made me think I should probably just cover 
     7                  one brief area with Mr. Barrett while we've got 
     8                  him here and I would ask that Madam Registrar 
     9                  present document book 14.  I'm not sure what 
    10                  the -- I think it's Exhibit 34. 
    11              Q   And these questions relate to raffles that were 
    12                  conducted pursuant to licences granted to the NDP 
    13                  and while Madam Registrar is looking for the 
    14                  exhibit I can tell you that there are a couple of 
    15                  documents in the exhibit book that we have been 
    16                  looking at today, Exhibit 222.  The exhibit book 
    17                  of today which is exhibit book 74.
    18              A   I'm sorry, I'm confused.
    19              Q   If we go to today's document book Exhibit 222 and 
    20                  if you turn to tab 22.
    21              A   22, yes.
    22              Q   Yes.  It is an application for a lottery?
    23              A   Yes.
    24              Q   And it's an application in the name of the New 
    25                  Democratic Party of British Columbia and the 
 0111

     1                  charitable object is identified as the Nanaimo 
     2                  Community Health Services Charity Society.  And 
     3                  there's a federal tax number and an address 
     4                  given.  We know from evidence of other witnesses 
     5                  that the address and tax number are those of the 
     6                  NCHS Charity Society and not some organization 
     7                  called the Nanaimo Community Health Services 
     8                  Charity Society.
     9                       Now, Joe Denofreo is named as the contact or 
    10                  person controlling the operation of the lottery.  
    11                  And his signature appears on the second page.
    12              A   Yes.
    13              Q   There's a similar application for the following 
    14                  year and with similar information contained in it 
    15                  and then the proceeds of the two licenced 
    16                  activities are dealt with in the document book 14 
    17                  that the Registrar has just given to you so we 
    18                  can leave that book and come to here.
    19              A   Okay.
    20              Q   And I direct your attention first of all to tab 7 
    21                  of document book 14.  And it's a receipt from the 
    22                  NCHS Charity Society dated June 24, 1983 
    23                  acknowledging a donation of $38,121.65 from the 
    24                  NDP dollars for change raffle.  And then at tab 8 
    25                  there is a cheque in the exact same amount 
 0112

     1                  $38,121.65 on the 29th of July, 1983 signed by 
     2                  and on behalf of the Charity Society signed by 
     3                  Mr. Stupich and Ms. Marlow and the payee is the 
     4                  Democratic Publishing.  Do you have any knowledge 
     5                  of these events as they occurred in 1983?
     6              A   No.  Only as after the fact was I aware of these 
     7                  things.
     8              Q   All right.  And there was another transaction and 
     9                  if you turn to tab 23 of the same document book 
    10                  there is a receipt from the NCHS Charity Society 
    11                  dated August the 1st, 1984?
    12              A   Yes.
    13              Q   In the amount of $18,500 donated by B.C. NDP sun 
    14                  fun raffle?
    15              A   Yes.
    16              Q   And if you turn to tab 24 again there is a cheque 
    17                  in the same amount 18,500 payable to the NDP of 
    18                  B.C. signed by Mr. Stupich and Mr. Hackwood.  
    19                  Again, were you aware of these transactions?
    20              A   By the spring of that year I was no longer 
    21                  involved with the executive of the party.  
    22                  Effectively after the '85 campaign I dropped off 
    23                  the table in effect.
    24              Q   Okay.  So with regard to -- so is it your 
    25                  evidence that you weren't aware of the '84 events 
 0113

     1                  at all?
     2              A   Well, certainly no I wasn't.  '84 I was in 
     3                  another occupation.
     4              Q   All right.  With regard to the 1983 documents I 
     5                  asked you about, you indicated that you learned 
     6                  about it at some later date.  Can you tell us 
     7                  about that please?
     8              A   When I read the Parks report.
     9              Q   All right.  Mr. Denofreo didn't discuss these 
    10                  events with you; is that correct?
    11              A   No.
    12              Q   And no other table officer or --
    13              A   No, no.
    14     MS. SMITH:  All right thank you.
    15     THE COMMISSIONER:  Mr. Leask, before you comment, Mr. Barrett, 
    16                  I wanted to ask you for the benefit of your 
    17                  experience both as a legislator and as a social 
    18                  worker and as an educator, in the background of 
    19                  the observations which you have now had of the 
    20                  operation of NCHS and what the Parks report 
    21                  contained, and my request is for your comments 
    22                  about the regulatory environment for societies 
    23                  which you would have had some involvement to do 
    24                  with -- some involvement with on a number of 
    25                  levels I'm sure as a social worker.
 0114

     1              A   Yes.
     2     THE COMMISSIONER:  From your observation here in the Parks 
     3                  report and in your own experience can you suggest 
     4                  ways that the regulatory environment failed over 
     5                  the last 20 years and could be improved?
     6              A   I don't have any specific recommendations.  I was 
     7                  not involved in detail with the Gaming 
     8                  Commission.  There were subsequent reports by an 
     9                  Attorney General related to gaming Mr. Brian 
    10                  Smith and report as I understand it to the 
    11                  legislature.  If there's any general comment or 
    12                  advice that you're seeking you must put the 
    13                  advice down to the source that you're asking for, 
    14                  but I believe that it would be useful to use the 
    15                  standing committees of the legislature in a more 
    16                  meaningful way in areas like this and others. 
    17                       There has been a propensity in British 
    18                  Columbia unlike the federal jurisdictions not to 
    19                  use the standing committees more extensively.  
    20                  Now, there is a burden to that.  The compensation 
    21                  to members of the legislature in this province is 
    22                  singularly low.  The need to attract qualified 
    23                  candidates for all parties is a serious problem.  
    24                  We're having difficulty with people who in mid 
    25                  careers who are willing to break off those mid 
 0115

     1                  careers and stand for office when they know their 
     2                  best earning years are at risk.  If we're serious 
     3                  about have a legislature work it is my opinion 
     4                  that we should look at the compensation package 
     5                  and the pension packages to legislators in a way 
     6                  that any young man or any young woman regardless 
     7                  of party would be willing to take the risk to 
     8                  stand for office and all the public bombardments 
     9                  that go with that, at the same time still serve 
    10                  in a honourable profession in a more efficient 
    11                  manner. 
    12                       How I relate this to the committee is simply 
    13                  the house sittings are for a portion of the year, 
    14                  people must leave the house and go on with their 
    15                  lives and make a living for their growing 
    16                  families, pay their mortgages, so the time that 
    17                  would be taken by committee would intrude into 
    18                  the earnings time that's left.  So it's kind of a 
    19                  catch 22 or perhaps that slogan advertising pay 
    20                  me now or pay me later, but if the taxpayers wish 
    21                  to be served better and particularly in the 
    22                  question you're asking in gaming, it could be 
    23                  done through committees if they want to be served 
    24                  better generally those committees should be 
    25                  working.  There is a lot of talent regardless of 
 0116

     1                  party in every caucus and it's untapped simply 
     2                  because the pressures people have in sustaining 
     3                  their own lives while in public service. 
     4                       I do not regret for one minute the 29 years 
     5                  I spent in public life, I sought that activity, I 
     6                  enjoyed that activity, but I think it's 
     7                  important, since you're asking me and I'm 
     8                  responding to your question, that people 
     9                  understand more can be done to guide policy, to 
    10                  correct problems by using the members who are 
    11                  elected through those standing committees but 
    12                  there is a price for that.  I think the price is 
    13                  well worth paying. 
    14     THE COMMISSIONER:  All right.  That's a defect potential 
    15                  defect in the infrastructure in respect of policy 
    16                  general?
    17              A   Policy general and public interpretation of what 
    18                  people in public life are expected to do for the 
    19                  time frame.  It is currently fashionable for the 
    20                  public to demand young people to come to public 
    21                  life and people who are being wooed are described 
    22                  with good reason with excellent talents, but once 
    23                  somebody is named for a candidate for a party 
    24                  they become an immediate target for superficial 
    25                  media coverage.  It is regrettable that the word 
 0117

     1                  politician itself has always been in disrepute in 
     2                  waves, ups and downs.  But throughout my 
     3                  experience I have met some of the finest people 
     4                  anyone could possibly meet in all political 
     5                  parties who have given up so much to come into 
     6                  public life only to find that their private lives 
     7                  are intruded upon, their time for enhancing their 
     8                  own career by the necessity of economics takes 
     9                  place and the skill and talent that we should be 
    10                  recruiting by all political parties becomes 
    11                  diminished because of those things. 
    12                       You've given me a platform for a speech and 
    13                  you have to put it down as a speech, but I feel 
    14                  that in answer to your question and it is 
    15                  regrettable in my opinion.
    16     THE COMMISSIONER:  One of focuses of our inquiries is to look 
    17                  at the regulatory environment for societies as 
    18                  opposed to gaming and Mr. Broadbent has looked 
    19                  closely at that issue.
    20              A   Yes.
    21     THE COMMISSIONER:  And I'm wondering if you had have any 
    22                  opportunity to consider some of those issues 
    23                  particularly some of the recommendations he has 
    24                  raised in the context of British Columbia 
    25                  regulatory environment.
 0118

     1              A   Well, I'm halfway through a professional paper on 
     2                  the whole business of and I don't know when I'll 
     3                  finish it, on the whole business of charities in 
     4                  our society and the role of tax benefit funding 
     5                  for those charities.  I don't want to sound that 
     6                  I have a great number of polemics here but the 
     7                  danger is that we have shifted fund raising for 
     8                  very important health services and public 
     9                  services to competing fund raising efforts, we 
    10                  have agencies for lungs, we have agencies for 
    11                  hearts, we have agencies for body parts, we have 
    12                  agencies for special interests and all of them 
    13                  valuable all of them very important, but as we 
    14                  move the area of the developing agency oriented 
    15                  specific fund raising projects we have lost sight 
    16                  of the whole human being that we're supposed to 
    17                  be dealing with.  And my profession even the 
    18                  agencies in the red feather, the community chest 
    19                  are fractured, instead of being able to give 
    20                  service to a whole family, we break up pieces of 
    21                  the family, an abused mother who does need 
    22                  services, an abused woman, a father who can't get 
    23                  access to seeing the child, to the children who 
    24                  we place in foster homes, we have fractured the 
    25                  services in such a way in the private sector that 
 0119

     1                  the kind of pioneering work they did in the '50s 
     2                  and the '60s no longer exists.  It would well 
     3                  serve us as a total community to examine the role 
     4                  of charities in fund raising for social services 
     5                  and it would also serve us well to examine just 
     6                  exactly what kind of results we're getting for it 
     7                  and how much we're avoiding by not having general 
     8                  revenue funding to provide better services 
     9                  especially for children. 
    10                       I didn't expect to be asked that question, 
    11                  but when you ask a question like that of me it 
    12                  raises the whole passion of why I came into 
    13                  politics in the first place, and I deeply regret 
    14                  that dependent children in some instances are 
    15                  depending on charity. 
    16                       So gaming in my view at the very best should 
    17                  be looked upon as some kind of frivolous fun, 
    18                  hopefully with no lasting disaster of the people 
    19                  who have lost money but at the same time to rely 
    20                  on social services and fracture those social 
    21                  services because of fund raising on separate 
    22                  issues is a very dangerous route to go and 
    23                  results are already there to be seen. 
    24                       If I finish the paper I'll ask for a chance 
    25                  for a lecture series and I might draw three 
 0120

     1                  people, but that's where it's at.
     2     THE COMMISSIONER:  No, your comments are valuable to us.  I 
     3                  was focussing more on the regulatory environment 
     4                  for societies, in essence to keep the societies 
     5                  honest, because one of the comments that you made 
     6                  was that throughout this matter number one, you 
     7                  relied upon the integrity of Mr. Stupich.
     8              A   That's correct.
     9     THE COMMISSIONER:  Number two, you trusted, as I understood 
    10                  your evidence you trusted that the appropriate 
    11                  authorities were doing the jobs that they were 
    12                  supposed to do to make sure that everything was 
    13                  done the way it should have been done?
    14              A   I think they were, yes.
    15     THE COMMISSIONER:  And in that respect, you were just saying 
    16                  now that you were satisfied that there was a 
    17                  sufficient regulatory infrastructure in place to 
    18                  safeguard the situation that we're dealing with 
    19                  where it appears that society assets in some 
    20                  respects were diverted.
    21              A   Other political parties were doing the same 
    22                  thing.  There was a report on that.  And the same 
    23                  accountability was not or was present.  I think 
    24                  it's obvious out of this very tragic experience 
    25                  for Mr. Stupich -- and I will not sit here and 
 0121

     1                  attack Mr. Stupich, out of this very tragic 
     2                  experience if this commission indeed can come up 
     3                  with a better filtering system to avoid this, 
     4                  then it's very, very worthwhile.
     5     THE COMMISSIONER:  Well, those are the matters I was concerned 
     6                  about.  Mr. Leask, is there anything that you 
     7                  want to --
     8     MR. LEASK:  I would be assisted by a very short recess and 
     9                  conference with my client.  I assure you we won't 
    10                  take very much time after that.
    11     THE COMMISSIONER:  Should we take 15 minutes or 10?
    12     MR. LEASK:  Ten would be fine.
    13     THE REGISTRAR: All rise.
    14                  (BRIEF ADJOURNMENT)
    15     THE REGISTRAR: All rise. 
    16     THE COMMISSIONER:  Thank you.  Mr. Leaks?
    17     MR. LEASK:  Thank you for the opportunity.  I hope I used the 
    18                  time well, I don't have any questions.
    19     THE COMMISSIONER:  That is time used extremely well. 
    20                       Mr. Barrett, I want to thank you for taking 
    21                  the time to come and assist us in this inquiry.  
    22                  I think you've identified that there are some 
    23                  areas where there can be great social utility 
    24                  with an inquiry such as this and your comments 
    25                  have been of assistance to us and I think you 
 0122

     1                  took great care in answering the questions and I 
     2                  thank you for you.
     3              A   Thank you very much.
     4     THE COMMISSIONER:  Ten o'clock tomorrow.
     5     MS. SMITH:  Two o'clock tomorrow.
     6     THE COMMISSIONER:  Two o'clock? 
     7     MS. SMITH:  Thank you, yes. 
     8                  (PROCEEDINGS ADJOURNED 2:56 P.M.)
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