Monday, November 21, 2011

Sheila Fraser is now officially in bed with Manulife

Isn't it strange that Canada's Auditor General Sheila Fraser refused to investigate whether the Harper government's claims of tax leakage from income trusts was a valid policy argument or not? In her role as Canada's Auditor General she was asked on numerous occasions by numerous groups and many thousands of Canadians to do so and refused. She even refused the written request of the Liberal Members of the Finance Committee to report on the validity of tax leakage, or not, thereby making a total mockery of her mandate which is described on her website as "Parliamentarians need objective and fact-based information about how well the government raises funds." Evidently not!

One of the greatest beneficiaries of the Harper government's move to kill income trusts and Sheila Fraser's dereliction of duty and one of the groups that lobbied hardest for this regressive government policy was Manulife Financial, since they were having a hell of a time selling their inferior retirement investment products in the face of Canandians' growing preference for income trusts. So what was Manulife's strategy? Engage in massive government lobbying and position yourself to benefit from the litany of falsehoods about income trusts, such as the allegation that income trusts cause tax leakage, which any Auditor General worth her salt could have easily proven was a crock of nonsense.

Is is any wonder that Sheila Fraser has now been appointed to the board of Manulife?

Here's the letter from the Liberals that Sheila Fraser ignored:

For Immediate Release
February 29, 2008

Liberal Finance Committee Members call on Auditor General to Examine Government's Claims of Income Trust Tax Leakage

OTTAWA - Liberal Members of the Standing Committee on Finance today called on the Auditor General to investigate the tax leakage claims that the government used as the basis for its October 31, 2006, decision to tax income trusts.

"I think that this government's stonewalling has gone on long enough and it's time that Canadians got to see that the Government simply made up its story that income trusts cause federal tax leakage," said Liberal Finance Critic John McCallum.

"Prime Minister Stephen Harper promised to Canadians that he would never tax income trusts. Then he went back on his word, costing Canadians billions overnight and in the wake of his silence on the issue we feel that only the Auditor General can shine some light into this matter."

All four Liberal Members of the Finance Committee signed a letter to Auditor General Sheila Fraser asking her to investigate the matter, particularly the government's unproven allegations about income trusts causing tax leakage.

"This has clearly become much more than just another instance of the government not doing its homework before acting. It has become a full-blown scandal and cover-up," said John McKay, Member of Parliament for Scarborough-Guildwood. "We have tried virtually every tool at our disposal to get the government to show us how they came to their conclusions about tax leakage and the Auditor General may be Canadians' last resort."

An Access to Information request asking for the Department of Finance's assumptions, data and methodology resulted in the release of only 23 pages of documents that are almost entirely blacked out.

A direct request from the Finance Committee to see the data was met with two thick binders of superfluous information that did not contain the data or methodology originally requested.

A written question was placed on the Order Paper asking the government to recalculate its estimate of tax leakage using the 15 per cent federal corporate tax rate that will actually be in effect in 2012, the year after the income trust tax begins, as opposed to the 21 per cent tax rate that was in effect at the time of the announcement. The government's response to the question indicated that that this would be a hypothetical calculation and therefore impossible to do.

"That's not a hypothetical, that's what the federal tax rate will be," said Garth Turner, Member of Parliament for Halton. "If the government can't manage to run the new 2012 corporate tax rate through their calculators then I have no reason to believe they ran the old one through their calculators in October of 2006."

In 2006, Stephen Harper ran on a campaign commitment to never tax income trusts. The Conservative election platform characterized any attempt to impose such a tax as, "An attack on retirement savings."

"That election commitment was obviously a falsehood. Unfortunately the voters who believed it and invested even more money in income trusts lost a significant portion of their nest eggs," said Massimo Pacetti, Member of Parliament for MP for Saint-Léonard-Saint-Michel.

"Even today, 15 months after they broke their election promise, Members of Parliament still hear from the thousands of Canadians whose retirement plans were shattered by this deception. Liberal Members of Parliament continue to stand up for them."


Here's perhaps the reason why:

Sheila Fraser appointed to Manulife Board of Directors

TORONTO, Nov. 3, 2011 /CNW/ - Manulife Financial Corporation and The Manufacturers Life Insurance Company announced today that Sheila Fraser has been appointed to their Boards of Directors, effective November 2, 2011. Ms. Fraser will sit on the Audit Committee and the Conduct Review and Ethics Committee.

Ms. Fraser served as Auditor General of Canada from 2001 to 2011. Prior to joining the Office of the Auditor General as Deputy Auditor General in 1999, she was a partner at Ernst and Young for 18 years.

Her contributions to the accounting and auditing profession include her current role as member of the International Federation of Accountants-International Public Sector Accounting Standards Board (IFAC-IPSASB). She has also chaired two committees of the International Organization of Supreme Audit Institutions (INTOSAI) as well as the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants.

Ms. Fraser earned a Bachelor of Commerce from McGill University, is a Chartered Accountant and among her many honours has received the designation "Fellow" from the Institute of Chartered Accountants of Ontario and the Ordre des comptables agréés du Québec.

"Ms. Fraser's financial background, management experience as Auditor General of Canada and leadership roles on international accounting issues make her an important addition to Manulife," said Manulife Chair, Gail Cook-Bennett. "We are delighted to welcome Sheila Fraser to our Boards."


Dr Mike said...

The big problem with all of this is that the general population doesn`t give a flying fig as long as it did not affect them.

As the gov`t framed this as "tax fairness" , the people on the street saw us as greedy SOBs who were stealing the food right out of their mouths.

Even my neighbour who is a guy in the know made the blanket statement that everyone needs to pay their fair share & why should you guys not pay.

Even after making the usual explanation , he looked at me like I had 2 heads.

The gov`t labelling this the "Tax fairness Plan" did us in.

Sheila Fraser was just another cog in the deception.

Dr Mike

PS---Just ask Brett Wilson of Dragon`s den fame what he thinks about the Con trust tax policy sometime---Charles Adler made that mistake last week---buzz-saw city.

Bruce Benson said...

Shella Fraser is another example of the sleeze and corruption in Government as sanctioned by Canadians that don't give a damn. What more can I say? Hope her new job maintains her high living standards that she has grown to accept all at the expense of screwed investors. Did I mention any fat government pensions being sucked up to boot?

Anonymous said...

Sheila Fraser will be one of the fraud inside job characters of Canada's version of the " Inside Job movie "

" The Great Canadian Pension Raid "


Anonymous said...

Occupy Bay Street reading this fiasco
about Sheila Fraser our AG our only hope for responsible government just makes their cause even more stronger !!