Updated Sat. Jan. 15 2005 7:49 AM ET

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Sgro quits cabinet to fight allegations

CTV.ca News Staff

Embattled Judy Sgro has resigned her cabinet post, forcing Prime Minister Paul Martin to appoint a new Immigration Minister in a cabinet mini-shuffle.

Sgro offered her resignation during a meeting with Martin on Friday morning. As Martin told reporters after swearing in her replacement, Human Resources Minister Joe Volpe, he reluctantly accepted.

"I understand why she wanted to do it," he said. "She wants to have a completely free hand to defend herself against these allegations. And I am sure that she will succeed in doing that."

Sgro resigned following a report in Friday's Toronto Star, about a Toronto-area pizza shop owner named Harjit Singh.

Citing a sworn affidavit from the Federal Court of Canada, the paper said Singh approached the Toronto MP last year to ask for help with his family's immigration problems.

"I told her my whole situation and she assured me that if I helped out in her election campaign she would get me immigration in Canada," the father of three who came from India in 1988 told the Star.

Singh, who faces possible deportation next Thursday, alleged Sgro then broke their deal when allegations of ethical misdoings in her office began to surface late last year.

Sgro dismissed the allegation as "outrageous fabrications.''

"I have come to the conclusion that I must step aside effective immediately from my position . . . due to persistent and false allegations,'' she said in a written statement.

Proclaiming her innocence, Sgro insists she only quit to spare the government more controversy, and to fight harder to clear her name.

"As long as I'm the minister, I can only say 'I can't comment, can't comment.' And I can't stand that. I want to be out here defending my name," she told CTV News.

Sgro denies ever talking to Singh, and she suspects his motives.

"He's a desperate man. He's been in this country 20 years. He's about to be deported and he doesn't want to," she said. "And he's going to do anything and say anything, I would suggest, to be able to stay here."

With Volpe now filling Sgro's post, Minister of Intergovernmental Affairs Lucienne Robillard will assume Volpe's file.

Martin's first casualty

Martin explained that he would have supported Sgro if she had decided to stay in cabinet until after the federal ethics commissioner had ruled on her conduct, but relented because this was what she wanted.

"She decided that she wanted to step down in order to defend herself... and I accepted her resignation, with regret, on that basis."

Sgro has been embroiled in a growing ethical controversy since last year, when she was accused of helping a stripper who volunteered in her Toronto campaign office with her residence permit.

Since then, the 60-year-old minister has fielded allegations she took an improper election donation from a member of her riding association, and that her chief of staff held an inappropriate meeting with a strip club owner who was having trouble bringing dancers from abroad.

The federal ethics commissioner is already investigating several of the allegations levelled at Sgro.

In an interview with CTV's Canada AM, Citizenship and Immigration Committee chairman Andrew Telegdi said he expected Sgro to weather this political storm.

"She's got one of the safest ridings in the country and I just cannot see these allegations being grounded in fact," the Liberal MP from Kitchener said.

Nevertheless, Telegdi conceded a brand-new minister could throw the busy immigration work off track, but expressed hope it would do the opposite.

"Immigration is the lifeblood of this country and we need to get away from these soap operas," he said.

In the interim, Martin said he continues to stand behind the first minister to be forced from his cabinet in a swirl of controversy.

"I think that she was a very strong minister," he said. "I think that she brought a great contribution... and I look forward to her continuing public career."

Reflecting on the Martin's response, CTV Ottawa Bureau Chief said that tack may saddle the Liberals with some difficult political baggage.

"The PMO may have some real difficulty with this," Oliver said, recalling Martin's vow not to replicate the political style of predecessor.

"He was not going to do things the way Jean Chretien did them -- which was sticking to ministers no matter how badly they were behaving until the very last moment."

With files from CTV's Roger Smith and The Canadian Press

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