Shuffle shakes up Chretien's Cabinet

Ten new faces are in Prime Minister Jean Chretien's Cabinet while seven politicians were dropped in the most sweeping shuffle for the Liberal government.

Surprises included John Manley promoted to deputy prime minister and Industry Minister Brian Tobin resigning, to be replaced by Allan Rock.

Tobin's unexpected decision to leave politics cleared the way for a broader shuffle. The former Newfoundland premier said he was quitting for "personal renewal."

There continues to be speculation about other reasons for Tobin giving up on his undeclared bid to succeed Chretien.

In his third term, Chretien, 68, made it clear he is still in charge and gave no hint of retiring.

He moved out Alfonso Gagliano, under fire over allegations of political meddling, who became ambassador to Denmark.

Most prominent departure was Herb Gray, a 39-year veteran who was deputy prime minister and now serves on an international commission. The biggest promotion was Bill Graham, who replaced Manley as Foreign Affairs minister.

Manley also became minister of Infrastructure and Crown Corporations with responsibility for antiterrorism policy.

Inquiry: Water tragedy could have been prevented

Canada's most deadly municipal water contamination that killed seven people could have been prevented, a judicial inquiry found.

The E. coli outbreak in Walkerton, Ontario, was avoidable if brothers Stan and Frank Koebel, who ran the water system, had properly chlorinated the water and the Ontario government had listened to warnings, Judge Dennis O'Connor said Friday.

His hard-hitting report followed nine months of testimony from 114 witnesses during an inquiry into the May 2000 tragedy. Half of the 5,000 people in the farming town became ill.

The bacteria contaminated the water after unusually heavy rain swept manure from a farm into one of the wells.

The Conservative government ignored repeated warnings about the effect of slashing millions in spending and cutting red tape, the judge concluded.

News in brief

Canadian scientists said they were amazed at experiments showing how deadly anthrax is when delivered through the mail. Studies concluded a person could be infected with a lethal dose within seconds of opening an envelope and others nearby within minutes. The experiments at the Suffield, Alberta, military base were conducted after a hoax letter claiming to contain anthrax was sent to a federal government office.

Bank credit card interest rates are "grotesquely high" and should be reduced, new junior finance minister John McCallum said. The former chief economist at Royal Bank wants to see if the government can force rates lower. They remain around 18 percent while department stores charge about 28 percent.

Facts and figures

Canada's dollar is at a record low 61.95 U.S. cents. while the U.S. greenback was worth $1.6142 Canadian before bank exchange fees on Friday.

For the 10th time in a year, the central bank reduced its key interest rate, this time by one-quarter percent to 2 percent, the lowest since 1960. Banks cut the prime-lending rate to 3.75 percent.

Stock markets were lower, with the Toronto Exchange 300 index at 7,637 points and the Canadian Venture Exchange 1,092 points.

Lotto 6-49: (Wednesday) 13, 17, 18, 28, 37 and 44; bonus 32. (Jan. 12) 1, 7, 13, 30, 34 and 36; bonus 38.

Regional briefs

British Columbia's cash-strapped Liberal government plans to cut at least 11,700 jobs over three years from its work force of 38,000. Premier Gordon Campbell wants to save $1.9-billion to balance the budget. Government services will be cut by an average 25 percent.

Ontario Power Generation will slash 2,000 jobs over two years to become more efficient as the electric utility faces a deregulated market. The cuts are part of a restructuring plan that will cost the company almost one in five jobs.

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