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Politics Canada must try to save global giant SNC-Lavalin, Paul Tellier says

Canada needs to ensure SNC-Lavalin Group Inc. remains globally competitive, says Paul Tellier, a distinguished figure in Canadian business and a former top civil servant.

The construction and engineering giant made mistakes under previous management, Mr. Tellier said. SNC should ensure those mistakes are not repeated, he added, but its future is crucial to Canada’s standing in the global business environment.

“Shall we try as Canadians to save a company like this? Yes. Big time,” Mr. Tellier told The Globe and Mail’s Report on Business Magazine.

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“I’m not going to take sides for or against the [Prime Minister’s Office]. But people don’t look at the big picture,” he said, adding that SNC-Lavalin is one of the few Canadian companies that are truly global and dominant in their industries. “How many does this country have? As Canadians, we should feel very proud that it is competing with giants like Bechtel, Fluor and so on.” Bechtel Corp. and Fluor Corp. are both global construction and engineering giants.

Respected in both business and political circles, Mr. Tellier’s voice is an influential one as the merits of a deferred prosecution agreement (DPA) for SNC are debated.Through the 1970s and early 1980s, he held several high-profile deputy minister roles, culminating in a job as Canada’s top civil servant − Clerk of the Privy Council − under former prime minister Brian Mulroney. He went on to lead Canadian National Railway Co. after the federal government privatized the company in the 1990s. Mr. Tellier ran CN for ten years and turned it into a transportation powerhouse. After his tenure at CN, he served as chief executive officer of Bombardier Inc. for two years.

Read the full interview in ROB Magazine: Is SNC-Lavalin worth saving? ‘Big time,’ says former government insider and CN Rail ex-CEO Paul Tellier

David Lametti, federal Justice Minister and Attorney-General, is currently weighing whether to offer SNC-Lavalin a DPA – which is also known as a remediation agreement. In 2015, the RCMP charged the company with bribery and fraud. It is alleged that SNC-Lavalin paid millions of dollars in bribes to public officials in Libya between 2001 and 2011 to secure government contracts.

A conviction for SNC-Lavalin could mean a ban of up to 10 years from bidding on federal contracts.

SNC-Lavalin has argued that it cleaned house under new leadership and installed new ethics and compliance systems. Under a DPA, the company would accept responsibility for wrongdoing and pay a financial penalty, as well as show a commitment to enhance ethics and compliance standards.

But last September, Canada’s director of public prosecutions declined to offer SNC-Lavalin a remediation agreement. The issue morphed into a political firestorm this year after former attorney-general Jody Wilson-Raybould, who preceded Mr. Lametti, said she faced pressure from the PMO to offer the company a DPA last fall.

Mr. Tellier expressed concern about the increasing concentration of power in the Prime Minister’s Office. “Over the past 10, 12, 15 years, there has been too much centralization of power in the Prime Minister’s Office,” he said. “In my days, when I worked as a deputy minister under the senior Mr. Trudeau, my minister was not getting phone calls from the PMO. When I worked as privy council clerk for Mr. Mulroney, he was not phoning his ministers, and he didn’t have his chief of staff telling them what to do.”

“Under Mr. Harper, it became the trend that the PMO was involved in a great many files. I deplore that centralization of power,” Mr. Tellier said. “If there is a perception that the buck stops there, corporate Canada will be calling on the Prime Minister’s Office.”

Quebec politicians, including Premier François Legault, have asked for the federal government to settle with SNC-Lavalin in order to protect jobs and to ensure that the company’s headquarters remains in Montreal. Canada’s business community, however, has remained relatively quiet on the matter.

In speaking up, Mr. Tellier did not play down the alleged misdeeds of former SNC-Lavalin employees. “Yeah, some mistakes were made by the previous management, at every level, and they should pay the price,” he said. But he does not believe the entire company should be punished.

“Make sure the mistakes are not going to be repeated. But if you don’t find a way of giving them a chance to continue to compete internationally, like the Brits and Americans are doing, that company is going to be destroyed,” he said.

A number of Group of Seven countries permit out-of-court settlements for corporate offenders, including Britain, the United States and France. Canada’s federal government amended the Criminal Code in 2018 to allow deferred-prosecution agreements.

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