Last Updated: Wednesday - 01/05/2011

Government denies asking churches for mortgages

OTTAWA — Deputy Prime Minister Herb Gray denies that the government asked the churches that ran Indian residential schools to turn over property mortgages as security in any agreement on settling lawsuits by former students.

Asked whether any other security was being requested from the churches, Gray replied, "There were some discussions in September about a possible agreement between the churches on sharing responsibility but there was no request for mortgages on church buildings."

The claim was made in a National Post story the same day quoting Bud Smith, a former B.C. attorney-general and a member of the team of Anglican negotiators that has been meeting with federal officials on ways to resolve mounting native residential lawsuits.

Smith told the newspaper the government "wanted the mortgages of every church in Canada as security."

Smith added, "If we agree to do that, the government could foreclose on our church buildings the way any commercial lender would. I wouldn't put them past that."

Gary also denied the allegations in the House of Commons. No mention of Gray's denial of Smith's claims appeared in the National Post the following day.

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