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The province's Integrity Commissioner says a member of Ontario Premier Dalton McGuinty's cabinet has broken the province's integrity rules by appointing a close business and political associate to manage his affairs.
In a long-awaited report released this afternoon, Integrity Commissioner Coulter Osborne says Transportation Minister Harinder Takhar should have informed him that the trustee for his blind trust was the treasurer of his riding association.
Mr. Osborne has recommended that Mr. Takhar be reprimanded but says it would be unfair to impose further sanctions.
"Although I regard this as a serious matter, I have to recognize that the minister did not go about intentionally trying to short-circuit the system," Mr. Osborne says in the report. "I accept his statement that had he realized that his arm's length relationship with [the trustee]was compromised, he would have taken steps through this office to straighten things up."
Mr. Takhar said in a statement that he accepts the commissioner's reprimand.
"I have always strived to conduct myself with the best of intentions and utmost integrity, but it is clear from this report that I displayed an error in judgment and for that I sincerely apologize."
Amid opposition calls for Mr. Takhar's resignation, Mr. McGuinty stood by him today. "It is clear the Minister demonstrated a lapse in judgment in this circumstance," Mr. McGuinty said in a statement. However, he added, "I continue to have confidence in Minister Takhar as my Minister of Transportation and as a valued member of my cabinet and caucus."
New Democrat MPP Michael Prue told reporters Mr. Takhar has no choice but to step down from cabinet. "He should not be in the Premier's inner circle," he said.
Mr. Takhar has been fighting accusations since last June that he has not completely severed his ties to his family-owned business, the Chalmers Group of Companies. When he entered cabinet in October, 2003, he was required to put his company in a blind trust to be administered by an "arm's length" trustee. The trustee is Joseph Jeyanayagam, who is the chief financial officer of both the Chalmers Group and Mr. Takhar's riding association.
Mr. Takhar stepped down as president of the Chalmers Group, a maker of transmission systems and hospital products. His wife, Balwinder, is now CEO.
He told reporters last June that he has followed the rules governing blind trusts. "I believe I have done everything right," he said at the time.
Mr. Takhar did inform the Integrity Commissioner that the trustee for his blind trust was an executive at Chalmers. However, he did not also inform him that Mr. Jeyanayagam was CFO of his riding office.
A spokeswoman for Mr. Takhar initially said last summer that the commissioner was "fully aware" of the business and political relationship between the minister and the trustee but later clarified that statement. Mr. Takhar put his assets in a blind trust well before Mr. Jeyanayagam was appointed CFO of his riding association, she said. The commissioner was not told that the trustee subsequently assumed a role at the riding office because the province's Integrity Act does not require such updates.
"I never discussed any business dealings with my trustee or anybody else."
Mr. Takhar asked the commissioner to review the matter after Progressive Conservative staff members secretly photographed Mr. Takhar pulling into the parking lot at Chalmers offices in Mississauga last April 29. The photos, which were released to the media, show Mr. Takhar entering the building and leaving more than three hours later.
Mr. Takhar said he went to the Chalmers office to discuss his daughter's university education with his wife and Mr. Jeyanayagam.
In the report, the Integrity Commissioner said he does not have "clear and convincing evidence" that Mr. Takhar was engaged in the management of Chalmers. "There is, however, no doubt that the minister was egregiously reckless in participating in the April 29th meeting at Chalmers."
Karen Howlett