Prime Minister Stephen Harper resisted calls to fire his top aide over the so-called NAFTA-gate on Thursday, but promised a federal probe into the affair would be wide-sweeping and could include the Prime Minister's Office.
The prime minister faced a barrage of criticism from NDP Leader Jack Layton on Thursday, who appeared in the House of Commons and on CNN, demanding Harper dismiss his chief of staff, Ian Brodie.
"Will he now apologize to this House, the American people, and Senator [Barack] Obama, and will he fire his chief of staff?" Layton asked in Parliament.
"Will the prime minister show some backbone and show Mr. Brodie the door immediately?"
Brodie is accused of being the secret source who told CTV journalists on Feb. 26 that the staff of Democratic presidential hopefuls Barack Obama and Hillary Clinton had quietly told Canadian officials that their public statements about wanting to renegotiate NAFTA were not to be taken seriously.
But for reasons that are not clear, it was Obama, not Clinton, who became the main focus of CTV's story on the matter.
Soon after, Obama was on the hot seat again when someone leaked a Canadian diplomatic memo outlining a conversation where an Obama representative reassured a Canadian consular official that his threats on NAFTA were to be seen as "more reflective of political manoeuvring than policy."
'We are going to investigate this entire matter'
Previously, Harper has said the leak of the confidential memo would be investigated, but on Thursday he said the investigation would be thorough.
"We are going to investigate this entire matter and take whatever action is deemed to be necessary based on the facts that we discover," the PM said. "I'm not going to comment on rumours."
Harper noted he had already said the leak, which came before crucial U.S. primaries in Ohio and Texas on Tuesday, was "extremely unfair" to Obama and contrary to the interests of the Canadian government.
He reiterated that the clerk of the Privy Council was working with Foreign Affairs to conduct an internal security investigation to find out who was behind the leak.
Layton repeated his attacks Thursday night when he was interviewed on the American news network CNN by Lou Dobbs, a well-known Conservative commentator who strongly opposes NAFTA.
"It's not right, he hasn't yet apologized and he hasn't yet fired the source of the leak, so we'll keep working on that on our end," Layton said.
Liberals join NDP attack
Liberal Leader StÃƒ©phane Dion got embroiled in the matter on Thursday too, saying Harper was dodging responsibility for the leak in order to protect his top aide.
"Was the prime minister misleading the House or was his chief of staff misleading the prime minister?" Dion asked.
Harper, in turn, responded with a jab at Dion, saying his questioning "completely misses the story," while offering rare praise for Layton's queries.
"The leader of the NDP has asked solid questions on this and they deserve answers and we're going to find those answers," Harper said.
'It was interference': Wilkins
The prime minister's comments in question period came shortly after David Wilkins, the U.S. ambassador to Canada, said the leaked memo amounted to Canadian interference in America's political process.
In an interview with CBC News in Ottawa, Wilkins was asked specifically whether there was interference.
"I guess you could say it certainly shouldn't have happened; it was interference," Wilkins replied.
But he added he is confident the two countries will move past the incident.
"I think it's obviously a bump in the road but it's not something that's insurmountable, and we move on from it," he said. "But again, I don't think it's something the Canadian government did in an official capacity and I think they've expressed their deep regret."
Leaks came before Obama loss in Ohio
The leaks came in the final days before Tuesday's primary in Ohio, where Obama ended up narrowly losing to Clinton.
In a debate in Cleveland leading up to the primary, both Clinton and Obama threatened to pull the United States out of the 15-year-old free trade agreement with Canada and Mexico unless it's renegotiated. The deal is unpopular with many workers in Ohio who blame the pact for the loss of manufacturing jobs.
But Obama's threat was questioned when CTV News emerged with its report on Feb. 27 that said that Obama advisers had privately told Canadian diplomats that Obama's promise to reopen the agreement was just empty talk aimed at winning votes in Ohio.
A CTV reporter told CBC News that Brodie was the source of that report.
The report caused an uproar in the United States, with Clinton accusing Obama of double-talk, while the Republican front-runner and now nominee, John McCain, said Obama wasn't a straight-talker.
The criticism increased when the diplomatic memo, written by a Canadian consular employee, was leaked to the Associated Press describing a conversation between Obama's economic adviser, Austan Goolsbee, and Canadian Consul General Georges Rioux.
The chief campaign strategist for Obama's Democratic rival, Clinton, has acknowledged that the memo was a big factor in Clinton's victory in the Ohio primary.
"It had a significant impact," Mark Penn said during a conference call with reporters early Thursday. "I think it is going to be a serious issue moving forward in this campaign. It raised serious questions about Obama."
Goolsbee has said his comments were mischaracterized and Obama has denied the accusations of double-talk. The Canadian Embassy has also apologized for any confusion the memo may have caused.
Wilkins' interview will be broadcast Saturday at 9 a.m. ET during CBC Radio's The House.
© 2008 CBC News