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Senator Mike Duffy get into his car at the back of the Senate on Parliament Hill on May 22, 2013.DAVE CHAN/The Globe and Mail

A draft report on Mike Duffy's expenses clearly shows a Conservative-dominated committee removed several key sentences that would have cast the PEI senator in a more negative light.

A copy of the report obtained by The Globe and Mail contains 10 paragraphs, whereas the final version from the Senate internal economy committee has only seven.

Among the portions that were redacted was a quote from Mr. Duffy's lawyer, Janice Payne, taken from a letter sent to the committee on March 26, one day after Mr. Duffy repaid more than $90,000 in questionable expenses. The letter appears to suggest Mr. Duffy argued his refusal to co-operate with auditors was motivated by a desire to save taxpayer dollars.

"The considerable time required for Senator Duffy to compile the extensive information and documentation required of him by Deloitte as well as his participation in the review of that material, to say nothing of the public expense involved in the same, is no longer needed," she wrote.

Another redacted section states: "Senator Duffy's travel patterns were consistently Ottawa-PEI-Ottawa, demonstrating that Ottawa was his primary or default location."

The existence of the draft report had previously been reported by CTV, but copies of it began to circulate more broadly only on Wednesday.

Facing calls from his former Conservative colleagues to resign from the Senate, Mr. Duffy said he is now ready to fully co-operate with a review of his expenses and predicts he will be vindicated in the process.

The Conservative majority in the Senate voted this week to send Mr. Duffy's expenses back to the internal economy committee for further review. Liberal senators objected on the grounds that the committee had "whitewashed" its original report. A Liberal motion to refer Mr. Duffy's expenses to police was dismissed by Conservative senators and rejected on procedural grounds.

In the Senate on Wednesday, Liberal senators said their representatives on the internal economy committee had voted behind closed doors against the "whitewashing" of the Duffy report.

The Government Leader in the Senate, Marjory LeBreton, defended the committee's work.

"It is not a cover-up. I am absolutely comfortable with the process," she said.

The opposition is demanding to know whether the language changes in the report are the result of a deal between Mr. Duffy and Nigel Wright, who resigned Sunday as Prime Minister Stephen Harper's chief of staff for secretly giving the senator $90,000 to repay his expenses. Ms. LeBreton said she only learned of Mr. Wright's intervention when it was reported in the media.

"The fact is, these discussions between the former chief of staff to the Prime Minister and the now independent Senator Mike Duffy have been referred to the Ethics Commissioner, and I am quite sure that, in the fullness of time, she will get to the bottom of what actually transpired here and answer your questions and my questions," she said.

A day earlier, she told the Senate that the committee made a conscious decision to use stronger language in reports dealing with the expenses of two other senators, Patrick Brazeau and Mac Harb.

"My understanding in the case of senators Harb and Brazeau … there was language used to facilitate the repayment of monies owed to the taxpayer," Ms. LeBreton told the Senate on Tuesday evening.

On Wednesday, she delivered a speech on the "crisis" in the Senate, arguing that abuses were much worse under the Liberals but that Conservatives are taking the heat because they opened up the Senate books.

Had that not happened, there would be no "hyped-up media stories about spending abuses," she said.

"But I am not surprised," she said. "I am a Conservative and I know more than most that around this town populated by Liberal elites and their media lickspittles, tut-tutting about our government and yearning for the good old days that we are never given the benefit of the doubt and are rarely given credit for all the good work that we do."

She also urged the Senate to approve stronger disclosure rules for senators that would be in line with reports currently filed by cabinet ministers. Liberal senators objected to one change, which would mean a reduction in travel permits for trips in Canada to places other than between Ottawa and their ridings.

Mr. Duffy sat in the Senate on Wednesday for the first time since he resigned from the Conservative caucus. He sat next to Pamela Wallin, who also resigned last week because of a continuing audit of her expenses. The two senators chatted with each other and also briefly with Mr. Harb, who recently resigned from the Liberal caucus and is fighting an order that he repay more than $50,000 in expenses.


A draft report on Senator Mike Duffy's expense claims shows how the Conservative-dominated committee removed several key sections.

Mr. Duffy's lawyer says an audit is unnecessary after the repayment: "A letter was received from [Mr. Duffy's Ottawa lawyer Janice Payne] on March 26, 2013 in response, indicating that Senator Duffy had repaid an amount regarding the housing living allowance and that, 'In the circumstances, the review that Deloitte has been asked to undertake is now unnecessary.' "

The Senate says its expense rules are clear: "[T]he purpose and intent of the original Living Expenses in the NCR [National Capital Region] Guidelines and of the Senators Travel Policy adopted in June 2012 are very clear. … Your Subcommittee considers this language to be unambiguous and plainly, if a Senator resides primarily in the NCR, he or she should not be claiming living expenses for the NCR."

Details on Mr. Duffy's travel patterns and time spent at primary residence: "Senator Duffy was found to have spent approximately 30 per cent or 164 of the 549 days in the period of review at this declared primary residence. Additionally, Senator Duffy's travel patterns were consistently Ottawa-PEI-Ottawa, demonstrating that Ottawa was his primary default location."

A conclusion that Mr. Duffy uses the PEI cottage mostly in summer: "… while recognizing that Senator Duffy owns a residence in PEI and spends considerable time there, in particular during the summer months, his continued presence at his Ottawa residence over the years does not support such a declaration and is contrary to plain meaning of the word 'primary' and to the purpose and intent of the provision of living allowance …"

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