Canadian Prime Minister Justin Trudeau has refused to stand down over claims he interfered to help a construction firm that allegedly bribed Muanmar Gadaffi’s regime to avoid a corruption trial.
The political scandal gripping Mr Trudeau’s Liberal Party began when his former justice minister claimed on Wednesday that she had been pressured to drop the prosecution of SNC-Lavin, a construction firm in the prime minister’s home province.
In her testimony, justice minister Jody WIlson-Raybould claimed she endured a "sustained" pressure to abandon a prosecution of the construction giant by Mr Trudeau’s staff.
It is the first time the Prime Minister has been implicated in the scandal and the claims threaten to inflict significant political damage on the Liberals just months ahead of what polls suggest will be a hard-fought election.
Mr Trudeau on Thursday said he disagreed with Ms Wilson-Raybould’s "characterisation" of events and insisted he had full confidence in an inquiry into the affair.
SNC-Lavalin is a major employer in the province of Quebec, where the Liberals have said they need to pick up seats to stand a chance of retaining a majority government.
Liberal officials note media coverage of the affair in Quebec has been generally favourable. SNC Lavalin is accused of paying $48 million (£28 million) in bribes to the Gaddafi regime in Libya between 2001 to 2011. It has been lobbying for a what is called a deferred prosecution agreement insted of a trial and criminal prosecution, something federal prosecutors have rejected.
Ms Wilson-Raybould said she had confronted Mr Trudeau in September over what she called persistent efforts by officials to help SNC-Lavalin evade trial on the corruption and bribery charges. That trial is now pending.
However Ms Wilson-Raybould conceded the actions did not break any laws. She was unexpectedly moved to a less prominent job in January and resigned from Mr Trudeau’s cabinet earlier this month. She said she was convinced her refusal to give way on the SNC-Lavalin case had prompted her demotion.
Conservative opponents have called for Mr Trudeau to resign in the wake of her explosive testimony.
Mr Trudeau addressed the controversy in a televised news conference in Montreal on Thursday, saying: "Canadians expect their government to look for ways to protect jobs, to grow the economy and that’s exactly what we have done … we’ve also done it in a way that has respected our laws".
The Prime Minister has also won the public support of a key political ally, foreign minister Chrystia Freeland, who is seen as a potential successor to the leader.
In an unusual move, Ms Freeland appeared on the Canadian broadcaster CBC to say she fully backed Trudeau. "Of course I support the prime minister 100 percent … I am very clearly of the view that the prime minister would never apply improper pressure," she said.
But another senior Liberal Party member said there was growing unhappiness among legislators about how Mr Trudeau’s team had handled the SNC-Lavalin matter and said the prime minister needed to replace some of his staff.
"The level of concern over what has happened over the last few hours is unprecedented," said the Liberal, who did not want to be named.
The Liberals have a majority in the House of Commons and if they all vote with Mr Trudeau they can fend off any votes of confidence.