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Clerk of the Privy Council Michael Wernick waits to testify before the House of Commons justice committee in Ottawa on Thursday, Feb. 21, 2019.CHRIS WATTIE/Reuters

Canada’s top public servant has confirmed Jody Wilson-Raybould was unwilling to negotiate an out-of-court settlement with SNC-Lavalin despite repeated efforts by Prime Minister Justin Trudeau and other senior officials to revisit the question of the company’s pending criminal prosecution on fraud and corruption charges.

In dramatic testimony before the House of Commons justice committee, Michael Wernick, the Privy Council Clerk, said the former justice minister and attorney-general was warned about the economic consequences of a criminal conviction of SNC-Lavalin but was not subjected to “inappropriate pressure” to shelve the prosecution of the Quebec engineering company.

“If you boil it down for Canadians as to what is going on here with the facts that we have and all of the facts that I know from my participation in meetings and conversations, we are discussing lawful advocacy," he told MPs on Thursday.

The Clerk’s testimony revealed that officials repeatedly raised the economic ramifications of an SNC conviction, despite the fact that the law prevents the attorney-general from considering that factor in this particular case. Under Canada’s new deferred-prosecution agreement rules, prosecutors are not allowed to consider national economic interests when deciding whether to settle with a company that faces charges under the Corruption of Foreign Public Officials Act.

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The committee hearings were called after The Globe and Mail reported Feb. 7 that officials in the Prime Minister’s Office put pressure on Ms. Wilson-Raybould to reach a negotiated settlement with SNC-Lavalin on criminal charges the company faces over its business dealings in Libya.

In the ensuing fallout, Ms. Wilson-Raybould resigned from cabinet and Mr. Trudeau’s principal secretary, Gerald Butts, stepped down. Ethics Commissioner Mario Dion has launched an inquiry into the matter.

Mr. Wernick, whose office advises and carries out the wishes of the PMO, began his testimony to MPs with an appeal to Canadians about the dangers of declining trust in government.

In remarks that were uncharacteristically personal, blunt and opinionated for a Canadian civil servant, Mr. Wernick said he was concerned that increasingly toxic public debate, fuelled by the “vomitorium of social media,” could spill over and hurt Canadians – even adding he was worried “someone is going to be shot in this country" during the federal election campaign this year.

Mr. Wernick told MPs that he expects Ms. Wilson-Raybould will testify next week that she had concerns about three conversations last year between senior government officials, herself and her staff, on the possibility of granting a deferred prosecution to the Montreal engineering giant.

“I predict that the former attorney-general will express concern to this committee about three events. The first is the meeting with the Prime Minister,” he said.

“The second is a conversation between the Prime Minister’s Office staff and her former chief of staff when she was minister of justice on Dec 18. And the third is a conversation that I had with her in the afternoon of Dec. 19.”

All these conversations took place after the director of Public Prosecution Service of Canada, Kathleen Roussel, had rendered a decision on the matter. She had informed SNC-Lavalin on Sept. 4 that she would not negotiate a settlement and would instead proceed to trial. The attorney-general can issue a directive to the director of public prosecutions about a prosecution or even assume conduct of a prosecution, but must do so in writing and a notice must be published in the Canada Gazette, except for Canada Elections Act matters.

Mr. Wernick said he was in a Sept. 17 meeting with Ms. Wilson-Raybould and Mr. Trudeau when the issue of SNC-Lavalin was raised.

The Prime Minister has raised concerns about the economic impact of a successful prosecution of SNC-Lavalin. A conviction would mean a 10-year ban from federal contracts.

In this mid-September meeting, Mr. Wernick recalled Ms Wilson-Raybould would not consider directing Ms. Roussel to enter into negotiations with the SNC-Lavalin.

“She advised the Prime Minister of her view that a deferred prosecution-agreement was not a good course and she had no intention of intervening and indeed she never has intervened,” Mr. Wernick said.

He said he himself telephoned the minister on Dec. 19. The Privy Council Clerk told MPs that there was real concern within and outside government about the potential job losses and the economic impact of SNC-Lavalin – an issue he raised directly with her in that December conversation.

“I conveyed to her that a lot of her colleagues and the Prime Minister were quite anxious about what they were hearing and reading in the business press about the future of the company, the options that were being openly discussed in the business press about the company moving or closing,” he said. “So I can tell you with complete assurance that my view of those conversations were within the boundaries of what is lawful and appropriate. I was informing the minister of context. She may have another view of the conversation but that is something that the Ethics Commissioner can sort out."

Mr. Wernick also flagged another conversation that he said took place on Dec. 18 between PMO staff and Jessica Prince, the former chief of staff to Ms. Wilson-Raybould. He said he could not shed light on that meeting because he wasn’t there.

He also could not offer any insight into a Dec. 5 meeting concerning SNC-Lavalin that Ms. Wilson-Raybould held with Mr. Butts at the Château Laurier hotel.

Mr. Wernick said Ms. Wilson-Raybould will offer the justice committee her view of how she “interprets or perceives those conversations” but he denied any suggestion that there was undue pressure applied to her or her staff.

He acknowledged she might see things differently but said she should have raised those concerns with Mr. Trudeau or the Ethics Commissioner at the time.

“If she felt, back in September, October, November, December, or at any point, that there was inappropriate pressure on her, she had recourse. She could have called the Ethics Commissioner at any time, any day. She could have contacted the Prime Minister at any time, any day,” he said.

Mr. Wernick said the Prime Minister began discussions in early January this year to replace Ms. Wilson-Raybould at Justice with Montreal MP David Lametti – whose riding is adjacent to the electoral district where SNC-Lavalin headquarters is located – after learning that Treasury Board president Scott Brison planned to resign. On Jan. 14, Ms. Wilson-Raybould was demoted to Veterans Affairs.

The Clerk said a deferred-prosecution agreement for SNC-Lavalin still remains a possibility. “It’s still open to the DPP [Ms. Roussel] to change her mind and to the minister to exercise the powers on the law.”

Deputy Conservative leader Lisa Raitt said she learned a lot from Mr. Wernick’s testimony.

“He explained there have been several times when the Prime Minister, either through Gerald Butts or Katie Telford or the Clerk of the Privy Council – sought to put pressure and even sway the decision, the already-made decision, of the attorney general,” Ms. Raitt said.

NDP MP Nathan Cullen said what’s important is whether Ms. Wilson-Raybould feels she faced inappropriate pressure.

“The attempt to sway her isn’t diminished because it failed,” he said. “The attorney-general must remain independent of pressure on any court case being prosecuted.”

On Thursday in Montreal, Bank of Canada Governor Stephen Poloz played down what a failure of SNC-Lavalin might mean to the economy. “I understand that 9,000 jobs is a pretty big number for any company,” Mr. Poloz told reporters. “Well, 9,000 jobs needs to be kept in context. Look at how many jobs were created in the month of January, that’s 67,000 net.”

Ms. Wilson-Raybould has not given her side of the story, saying she is bound by solicitor-client privilege and hired former Supreme Court of Canada justice Thomas Cromwell for advice on what she can reveal.

Mr. Wernick, who is not a lawyer, said he doesn’t think solicitor-client privilege prevents Ms. Wilson-Raybould from presenting her interpretation of events.

In his testimony, Mr. Wernick attacked The Globe, saying its original Feb. 7 article “contained errors, unfounded speculation, and in some cases [was] simply defamatory.” He said the story was wrong in stating that he had rebuked Ms. Wilson-Raybould for four speeches she delivered last fall that suggested politicians had engaged in doublespeak on Indigenous issues.

Sources said the speeches earned her a private rebuke from the Privy Council Clerk.

“It did not happen,” Mr. Wernick said.

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