Karlheinz Schreiber said Tuesday for the first time that foreign interests and money were involved in the campaign to unseat Tory leader Joe Clark at the 1983 Progressive Conservative convention.
Mr. Schreiber told the House of Commons ethics committee that the money he used to help arrange and pay for jets that transported anti-Clark delegates from Quebec to the convention in Winnipeg came from himself; the late Franz Josef Strauss, the chairman of Airbus Industrie; and probably from Mr. Strauss's political party, the Christian Social Union.
At that historic convention, Mr. Clark did not receive the support he was looking for in a leadership review. He then called a leadership race, which was won by Brian Mulroney.
"The money came from myself, and from the Strauss family, and probably from the [Christian]Social Union," said Mr. Schreiber, adding the amount he contributed was about $25,000.
Moments earlier, NDP MP Pat Martin had asked the German-Canadian lobbyist about his role at the convention and where the money came from.
"You helped buy a leadership race that created the next prime minister of Canada," Mr. Martin said.
When Mr. Schreiber first got involved in federal Conservative circles in the early 1980s, it was through Frank Moores, a former Conservative premier of Newfoundland, and another European businessman, Walter Wolf.
Mr. Schreiber and Mr. Wolf have both acknowledged that they helped arrange and pay for jets as part of the dump-Clark campaign.
But Mr. Schreiber went further Tuesday when he said the money they used for that endeavour came from German political and business interests. Mr. Schreiber has already testified that Airbus Industrie saw Canada in the 1980s as a "Trojan horse" for its entry into the North American market.
Over the past few months, Mr. Clark has repeatedly declined Globe and Mail requests for comment on Mr. Schreiber's involvement in the 1983 convention.
It was Mr. Schreiber's fourth appearance before the House of Commons ethics committee, which used a Speaker's warrant last month to get him out of the Toronto West Detention Centre. He was released from custody on bail last week.
Mr. Mulroney is scheduled to testify before the committee Thursday.
Mr. Schreiber told the ethics committee last week that the $300,000 in cash he paid Mr. Mulroney in three separate instalments in 1993 and 1994 came from a bank account containing funds he earned from companies whose projects moved forward under the Mulroney government.
The account contained money Mr. Schreiber received when the Mulroney government signed an agreement-in-principle with his client Thyssen Industrie for a military plant, called the Bear Head project, in Cape Breton in 1988. He said it also included commissions from Air Canada's purchase of Airbus planes and the acquisition of Messerschmitt-Bölkow Blohm helicopters for the Coast Guard.
Mr. Schreiber reiterated Tuesday that the $300,000 was part of a $500,000 payment intended for Mr. Mulroney in exchange for his help to promote the Bear Head project and that it had nothing to do with Airbus.
He said Mr. Mulroney never asked that payments be made in a form other than cash, and that Mr. Mulroney did nothing for the money.
Earlier Tuesday, Mr. Schreiber testified that he was at 24 Sussex Drive talking to Mr. Mulroney about the Bear Head project prior to March 1993 - three months before the former prime minister left office. The statement appears to contradict Mr. Mulroney's sworn testimony in his $2.1-million Airbus settlement, when he said he had no dealings with Schreiber.
Mr. Schreiber has also testified that he was asked by Mr. Mulroney's former chief of staff to send money to the former prime minister's lawyer in Switzerland "for Airbus."
Mr. Schreiber told the committee last week he was stunned when Fred Doucet requested that he transfer cash to a Swiss bank account.
Mr. Doucet denies the allegation from Mr. Schreiber.
"Allegations of impropriety he has made about me [last week] and on earlier occasions before this committee, and in correspondence are equally false," Mr. Doucet said in a statement.
Mr. Schreiber said the conversation occurred when Mr. Mulroney was still in office and took place in the Ottawa offices of lobbyists Government Consultants International (GCI), a firm run by Mr. Moores.
"I nearly froze when he said, 'I want you to make sure that GCI through you transfers certain amounts of money to an account in Geneva,' to a lawyer in Geneva, which is Mr. Mulroney's lawyer," Mr. Schreiber said.
"Why the hell would one send money to a lawyer in Geneva for Mr. Mulroney? What for? And now came his unbelievable answer: He said, 'For Airbus.' And I hear myself, even today, saying what the hell has Mulroney to do with Airbus? And his answer was, 'Are you naive?' "
Mr. Schreiber's allegation about his conversation with Mr. Doucet was first disclosed in his sworn affidavit filed several weeks ago in Ontario Superior Court. That affidavit was the first time Mr. Mulroney had been connected to the millions of dollars in secret commissions that were paid by Airbus to Mr. Schreiber.
Mr. Mulroney has denied benefiting in any way from the Airbus sale and won a settlement from the government in 1997 when his name was mentioned in an RCMP investigation into the sale. Mr. Schreiber has testified before the committee that he gave $300,000 to Mr. Mulroney in 1993 and 1994, but that the money was for "future services" and was not related to Air Canada's purchase of Airbus planes in the 1980s.
Mr. Schreiber testified today that he gave GCI "not less than $5-million" in commissions he earned from companies he represented.
A majority of respondents in a new Globe and Mail/CTV poll say Mr. Schreiber should be allowed to remain in Canada until he testifies at next year's public inquiry.
Germany seeks Mr. Schreiber's extradition to face charges of bribery, fraud and tax evasion.
But 59 per cent of respondents who were interviewed by the Strategic Counsel said his extradition should be delayed until after his testimony at the public inquiry into his financial dealings with Mulroney.
Thirty per cent said Mr. Schreiber should be deported as soon as possible, while 11 per cent had no opinion.
Justice Minister Rob Nicholson has the power to delay Mr. Schreiber's extradition, but he has not said whether he will keep him in Canada for the public inquiry. No date for the Supreme Court hearing has been set.
"I've got no doubt that what Nicholson wants for Christmas is a Schreiber-free Canada," Liberal MP Robert Thibault has said.
NDP MP Pat Martin said committee members were consulted on a request from Mr. Mulroney to have his family in the camera shot behind him during his appearance.
The committee chair, Liberal MP Paul Szabo, is expected to rule today, although Mr. Mulroney's spokesman said the seating plan was "irrelevant."
Mr. Harper has also called for a public inquiry into this matter, saying he needs to protect the office of the Prime Minister.
However, Canadians are split on the need for the public inquiry, given that Mr. Schreiber has already testified before MPs and given that Mr. Mulroney is scheduled to appear this week. The poll, which has a margin of error of 3.1 per cent, shows 45 per cent of respondents want a public inquiry, while 44 per cent do not.
Sixty per cent of respondents said they are not following Mr. Schreiber's testimony closely or at all.
With reports from Greg McArthur, Daniel Leblanc and Canadian Press