Behind the Story: Scandal upturns Canada's electoral landscape

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Rewind to January 2019, and Justin Trudeau's Liberal Party was on track to return to power in Canada's October federal elections. The Liberals had consistently led national polls since the 2015 election.

Fast-forward to March, and the landscape has flipped. The Conservatives are now ahead with multiple polling companies: A Thursday poll from the Angus Reid Institute puts the party nine points clear.

So, what happened?

Canada's former attorney-general Jody Wilson-Raybould (L), Prime Minister Justin Trudeau(C) and former Trudeau aide Gerry Butts. /VCG Compilation

The story begins with Jody Wilson-Raybould, the attorney-general and justice minister who was reshuffled by Trudeau to be veterans' affairs minister in January. It was widely seen as a demotion.

On February 7, Trudeau and officials were accused in a newspaper article of having tried to pressure Wilson-Raybould into allowing SNC-Lavalin, a Quebec-based engineering firm, to escape with a fine rather than go to trial for alleged fraud and corruption. A mediated agreement would have allowed the company to avoid a criminal prosecution and an accompanying 10-year ban on federal contracts.

SNC-Lavalin is based in Trudeau's home province of Quebec, and employs about 9,000 people in Canada. The prime minister denies acting improperly.

Five days later, Wilson-Raybould resigned from the cabinet. Fellow minister Jane Philpott quit in solidarity. A senior adviser to Trudeau, Gerry Butts, then attempted to draw a line under the matter by resigning.

But the story rumbled on, in part because it was a media sensation, in part because opposition parties worked to keep it in the spotlight, and in part because unanswered questions remained.

"It's about perceived and real lack of transparency that the Trudeau government has been scrambling, unsuccessfully, to fix," Angus Reid's Shachi Kurl said. "The lack of detail enables people's speculation."

The company's polling this week shows that 34 percent of voters think the issue has been overblown, but 66 percent believe there is a "deeper scandal."

Canada's former attorney-general Jody Wilson-Raybould gives testimony about the SNC-Lavalin affair on Parliament Hill in Ottawa, February 27, 2019. /VCG Photo

Wilson-Raybould told the parliamentary justice committee on February 27 she was put under "inappropriate" and "sustained" political pressure from Trudeau and senior officials to settle the prosecution. The prime minister says his team called for a second legal opinion, but strongly denies putting pressure on the then attorney-general.

Liberal MPs have since shut down the justice committee's investigation into the affair. And on Tuesday, the party's MPs on the ethics committee opposed an attempt by the Conservatives and New Democrats to hold further hearings into the allegations.

A Conservative-led #LetHerSpeak campaign has been pushed online, hitting the Liberals for not allowing Wilson-Raybould – Canada's first indigenous justice minister – to testify again.

The prosecution of SNC-Lavalin will still go ahead and attempts to dig deeper will likely continue. The Conflict of Interest and Ethics Commissioner's office is looking into the issue, and on Wednesday Wilson-Raybould submitted documents to the justice committee that she says support her claims.

Justin Trudeau, then Canada's prime minister-elect and leader of the Liberal Party of Canada, speaks to supporters on election night in Montreal, Quebec, Canada, October 20, 2015. /VCG Photo

The 47-year-old Trudeau's success has been built on an image as an agent of "real change" – a feminist promising openness and transparency, winning over young voters along the way. There is a danger the SNC-Lavalin scandal taints that brand ahead of federal elections due in October.

Angus Reid polling shows that 59 percent of Canadians now hold a worse opinion of the prime minister than a month earlier. In 2015, 68 percent of the 18-34 age bracket approved of Trudeau – in the latest poll that has dropped to 39 percent.

Worse for the Liberals, only 58 percent of people who voted for the party in 2015 say they currently intend to do so again. The Conservatives' voter retention rate is 88 percent.

Whether the Conservatives can sustain its advantage is less clear. Leader Andrew Scheer has taken his party to the right – notably on immigration – and 50 percent of Canadians view him negatively, according to Angus Reid.

Conservative leader Andrew Scheer receives a standing ovation in the House of Commons on Parliament Hill in Ottawa, March 19, 2019. /VCG Photo

The Conservatives' cause has been complicated by the emergence of a populist third party. The People's Party of Canada is led by Maxime Bernier, who lost out to Scheer in the race to lead the Conservatives in 2018 and founded his own party two years later.

Regional polls suggest the Liberals retain a lead in Trudeau's home province of Quebec, but have fallen behind the Conservatives in all other regions.

With almost seven months to go until the election, much could change. Trudeau has overcome the odds before.

But the prime minister, soaring high not long ago, has been wounded and has a fight on his hands to win in October.