A front-page story on May 13 incorrectly reported the number of seats in the Canadian House of Commons. The correct figure is 282.
A senior minister in Canada's Cabinet resigned today amid allegations that his wife had taken advantage of his government position to get favorable loans for their foundering family real estate business.
Industry Minister Sinclair Stevens was the fourth member to depart Prime Minister Brian Mulroney's Cabinet in the past 15 months amid charges of improprieties. These assorted episodes have become major preoccupations of the Mulroney government, which in September 1984 won a four-year mandate with 211 of the 248 seats in Parliament, the largest majority in Canadian history.
While these personnel troubles appear highly unlikely to bring down Mulroney's government, they seem to have eroded public support as measured by public opinion surveys.
Mulroney, who has been touring the Far East during most of the two weeks that the Stevens controversy has raged in the House of Commons and in Canadian newspapers, accepted the resignation from Peking, where he and senior aides took time out from an official visit to deal with the troubles back home. In a letter to Stevens, Mulroney acceded to the departing minister's request to appoint an "impartial person" to investigate the charges against him.
Stevens became the latest of the Cabinet ministers to find himself embroiled in controversy after the Toronto Globe and Mail newspaper last month reported that his wife, Noreen, had arranged for a $1.8 million loan -- interest free for one year -- with a Canadian auto parts company that has received more than $43.8 million in grants from Stevens' Department of Regional Industrial Expansion. Although the reported loan has been the subject of parliamentary discussion for two weeks, the accuracy of the report has not been denied by the family.
As they have done previously, Mulroney and his deputy prime minister, Erik Nielsen, initially responded to the first set of charges with denials that any conflict of interest was involved. Although they refused to discuss the matters in detail, their principal defense, as was Stevens', was that his own shares in the real estate company had been placed in a blind trust when he was sworn into office in September 1984.
Both the press and opposition members of Parliament, following a pattern similar to earlier episodes involving Cabinet ministers, continued to pursue the issue. Opposition critics suggested in the House of Commons that the Stevens family business, the York Centre Corp., had been deemed a poor credit risk by banks. Newspapers competed for other details of Noreen Stevens' activities on behalf of the firm, including how she reportedly had made the rounds of various Toronto brokerage houses involved with her husband's agency in search of investors. Sinclair Stevens said afterward that he had been unaware of those reported activities. His wife has declined to comment.
Later, the Globe reported that the Stevens family real estate firm also held a $566,000 loan from a South Korean bank in which the Korean automobile manufacturer, Hyundai Motor Co., was a substantial shareholder. Stevens claimed to have been unaware that Hyundai was a shareholder in South Korea's Hanil Bank, which had made the loan to the York Centre Corp. before Stevens took office.
The loan remained in effect after Stevens took office and continued in effect when Stevens was in negotiations with Hyundai in connection with its decision to build a $219 million assembly plant in Quebec.
The deal Stevens struck with Hyundai granted the auto company a $146 million loan with the interest assumed for five years by the federal and Quebec governments. The company was also relieved of normal requirements to purchase goods in Canada.
The first of the several resignations Mulroney has faced occurred when Defense Minister Robert Coates was forced to resign after the Ottawa Citizen newspaper reported in February 1985, that he had visited a West German strip club during a tour of NATO installations and shared a drink with a woman who described herself as an "exotic dancer."
Fisheries Minister John Fraser left the Cabinet last September after a television program revealed that he had overruled inspectors and allowed tainted tuna to be sold to Canadian consumers.
This was followed by the departure of Suzanne Blais-Grenier, who already had been demoted from her post as Environment Minister in the wake of charges that she had billed the government for lavish European trips.
Communications Minister Marcel Masse had to leave the Cabinet while the Royal Canadian Mounted Police investigated charges of campaign spending irregularities, but he later was cleared and returned.
In addition to the political embarrassment for Mulroney's administration, the incidents have overshadowed accomplishments, chief among them a rapidly improving economy after years of economic stagnation. Mulroney's difficulties in getting across positive messages about his administration are illustrated by the fact that the current controversy in Ottawa has knocked news of his trip to Japan, China and South Korea off the front pages here.
Although there have been rare occasions when Canadian public officials have been hauled into court on conflict of interest charges, breaches of public trust are for the most part examined and handled through the parliamentary system. Ministers are required to follow code of conduct guidelines that change as governments change.
The Canadian public has had a ringside seat during the Stevens affair. House of Commons proceedings are shown live during the day on cable television and rebroadcast in the evenings.