UPDATE 1-Canada PM unaware party was to repay expenses in scandal -ex-aide

(Releads with testimony from trial)
By David Ljunggren
OTTAWA, Aug 12 (Reuters) - Canadian Prime Minister Stephen
Harper did not know his Conservative Party was secretly planning
to repay expenses claimed by a senator caught up in a major
ethics scandal, Harper's former top aide testified on Wednesday.
The trial of Conservative Senator Mike Duffy, who is accused
of receiving a bribe and abusing expense claims two years ago,
comes as Harper campaigns ahead of Canada's Oct. 19 election.
Opposition parties say the affair shows voters should end the
Conservatives' near 10-year grip on power.
Harper's former chief of staff, Nigel Wright, is the
highest-profile witness to testify in the Duffy case.
The scandal erupted in February 2013 when it emerged Duffy -
appointed to the Senate by Harper - had claimed C$32,000
($24,600) in living expenses for a house in Atlantic Canada when
he was actually living in Ottawa most of the time.
Wright said the affair was sensitive for the Conservatives,
who took power in 2006 promising to clean up politics.
Wright said both he and Harper told Duffy he should pay back
the money but Duffy refused, saying he had done nothing wrong.
To end the bad headlines, Wright thrashed out a deal in
which Duffy would announce that he would repay the C$32,000 but
that the money would actually be provided by the party. Wright
then informed Harper that Duffy would reimburse the money.
Asked whether he had told Harper the Conservatives were in
fact footing the bill, Wright replied: "No ... I did not raise
it with the prime minister."
After meeting Harper, Wright wrote an email to aides saying
"We are good to go from the PM," which opposition parties say
shows Harper knew about the secret payment. Wright told the
court it merely meant he had raised the outlines of the
agreement.
The party pulled out of the deal when it emerged that Duffy
had in fact charged C$90,000 in living and travel expenses.
"I was beyond furious," said Wright, who decided the only
solution was to give Duffy a check for C$90,000 from his
personal funds.
Wright left the prime minister's office in 2013 when the
check became public. Harper insists he had no idea Wright
planned to give Duffy money.
"Mr. Wright was working with Mr. Duffy to make sure he did
repay them, and that's what we were told was going to happen,"
Harper said in response to reporters' questions at a campaign
stop in Vancouver.
"When I found out that is not what happened, that in fact
they had been repaid by somebody else, we made that information
public and I took the appropriate action."
Harper was heading to Canada's Far North on Wednesday. The
opposition New Democratic Party said the trip was strategically
timed.
"Nigel Wright might be on the witness stand, but it's
Stephen Harper who's on trial," said NDP leader Thomas Mulcair.
($1=$1.30 Canadian)