The federal ethics watchdog is investigating a sole-source contract Finance Minister Jim Flaherty's office awarded to a well-connected Conservative.
Ethics Commissioner Mary Dawson told Flaherty of the pending investigation in a letter Tuesday.
Flaherty has admitted his office broke government contracting rules in hiring Hugh MacPhie to help write last year's budget speech and provide advice on how to sell the document.
MacPhie, who had written speeches for former Ontario Tory premier Mike Harris, was awarded the $122,000 contract without tender.
Treasury Board rules generally require a bidding process for contracts worth $25,000 or more.
A spokesman for Flaherty says the finance minister has been open and transparent about the contract and will fully co-operate fully with investigation.
