Procedure and House Affairs Committee on April 21st, 2015

[The Chair, Conservative, Joe Preston]

We'll go ahead and get started so that we can keep on schedule today. We have a couple of great witnesses with us today to share some fantastic information about codes of conduct, we hope.

Mr. Fraser, nice to have you here. We know that you will also introduce who you brought with you, but let's go ahead and start with opening statements. Then we're going to ask you really hard questions.

Please, go ahead.

[Paul Fraser, Commissioner, Office of the Conflict of Interest Commissioner of British Columbia]

Thank you very much, all of you, for the invitation to join you today.

With me is Alyne Mochan, who is the legal officer and adviser in my office and who has made an important contribution to the written materials that have been circulated.

At the request of the committee, we have prepared a written submission that addresses several of the specific recommendations made to you by Commissioner Dawson. We look forward to our discussion of them with you.

In this brief oral statement this morning, I hope that you'll permit me to speak briefly about some of the broader issues that are engaged in your federal code and in conflict of interest legislation generally across Canada.

In doing that, I note that the committee has also said that it's looking for general input into your review of the conflict of interest code and any recommendation that the commissioner may have for the committee to consider in reviewing the code. Having come this far, I guess you would expect that I would have a couple of ideas of my own that I will throw in and tease you with or bore you with. If there is time in the Q and A perhaps you can explore them.

There are key differences between our legislation in British Columbia and your federal code. It may be helpful for me to to comment on certain of those features that I think are working well in British Columbia and have worked well in British Columbia for 25 years. British Columbia and Ontario of course were the pioneers in this country in comprehensive conflict of interest legislation. Canada was really the last of the major jurisdictions to join in that effort in 2007.

However, I want to say that the code is an impressive piece of legislation and includes many of the provisions that people have been toiling over in this tent in British Columbia for over 25 years. A number of the issues that were raised—some of them solved, some not—have wound up in the code.

In approaching the whole idea of amending it, I do so with the knowledge that you've done a pretty good job already. I say that in the context of the fact that in British Columbia we've had our legislation in place for 25 years. It's been amended substantively only once, and that is one of the reasons and consequences that it's become frankly outdated and a bit old. You have a mandatory review process; we don't. The opportunity given by your code to take part in a mandatory review is actually fairly rare in Canada. The only other jurisdictions are Alberta, New Brunswick, and Nunavut. The rest of the jurisdictions are on their own.

As we have found in British Columbia, if you don't have a mandatory provision requiring that the act be looked at on a five-year basis or any kind of basis, then what you have is a certain resistance to change. You don't have an opportunity as people who are working in the area to come forward and say, “Look, this is what is happening elsewhere. This is what we should be doing. This is how we should be modernizing our legislation.”

The code isn't perfect, of course, but the code certainly is a good amalgam of all the experience that's happened in this country.

Let me talk a bit about the appointment of the commissioner and that process. That may be rather introspective, but I think it's kind of important in terms of how conflict of interest legislation has been accepted by the members that it supervises across the country and by the members of the public who are, as we know, jaundiced to some extent in terms of the work that we do.

Your code requires consultation with party leaders, followed then by a resolution of the House with respect to the appointment. In British Columbia we have an all-party special committee that's struck to recommend the appointment of the commissioner. It's the only jurisdiction in Canada that has such a committee, which is populated on the basis of the support that the parties enjoy in the House. The practice has been that the committee must be unanimous in making a recommendation. If it isn't unanimous, then the committee is dissolved and a new committee is formed.

When the committee is unanimous, the convention is that the appointment recommended by the committee will be approved by the legislative assembly upon the motion of the Premier, and that all-party investment in the appointment process has proved to be very valuable in British Columbia.

Elsewhere, where the appointment has been made either by a Premier or by a cabinet order-in-council in Canada, there has been trouble, as we all know, and commissioners labouring under that impediment, if you like, have been called everything from hacks to shills to everything else. As you can see, some of us have the hide of a canal horse and we're still here. I'm here after seven years and having been reappointed once—I expect on the basis that better the devil you know than the one that you don't—I'm prepared to take that for whatever it may be worth.

Apparent conflict of interest is another significant difference in our legislation. One of the principles in your code is the expectation that members will fulfill their duties with honesty and uphold the highest standards so as to avoid a real or apparent conflict of interest. In British Columbia, we're the only jurisdiction in which apparent conflicts of interest are prohibited.

The test is as objective as you might hope and it is as follows:

For the purposes of this Act, a member has an apparent conflict of interest if there is a reasonable perception, which a reasonably well informed person could properly have, that the member's ability to exercise an official power or perform an official duty or function must have been affected by his or her private interest.

It's different from all of the other jurisdictions in Canada.

Regarding self-initiated investigations, your code provides the commissioner with that power. In British Columbia I have no plenary jurisdiction. I have no power to go out and sniff the air and initiate an investigation, but unlike only three other jurisdictions in the country, in British Columbia members of the public can make a complaint and request an opinion. We have an active media in British Columbia, as some of you may have noted, and it has always occurred to me that with an active media, but also because all of those people out there can, and I can tell you they do, ask for opinions, I'm quite sure that nothing is going on in British Columbia that hasn't reached somebody's attention and will ultimately reach mine.

Reporting material changes is very important in the code. Members have to report material changes within 60 days. In British Columbia, our practice or act—and we have only an act; we don't have an act and a code—provides that you must within 30 days report. The policy that informs that provision in our act is that the public should have access to the information on a timely and current basis and essentially know, literally on a monthly basis, how a member's holdings have changed. So as the sessions progress it would be possible for a member of the public who is skeptical about what people had to say about certain topics or certain legislation being considered would be able to see what happened in the last three, four, or five months up to the debate.

In terms of the commissioner's advisory role, an important part of the work we do and an important part of the work of commissioners across the country is to provide advice and opinions to members. We have the advantage that the commissioner lacks federally. We have the advantage of numbers. We have 87 members in our House and I must under our act meet with them annually. I look forward to it. I'm not sure they do, but I do. We have an interesting discussion where they can see, hopefully, that I bring to the task a certain practicality and common sense. I can do a bit of preaching, if you like, not much, but I mostly provide encouragement to people to come by the office and speak to me. It seems to be working.

As for integrity, your code talks about maintaining and enhancing public confidence and trust in the integrity of each member. I've recommended to our province that we amend our act to have similar expectations. The difference is that I'm hoping that those provisions—and I'll read you the provision that we're suggesting—will in fact be enforceable. It's difficult for me to imagine that a conflict of interest regime should not pay direct attention to ethics.

All conflicts of interest are not ethical problems, as we all know, but the way in which people comport and deport themselves, as your code reflects, is something that I think members of the public are entitled to know is being supervised.

In our country we have really an approach that says we will abandon any notion of prohibition in terms of how people conduct themselves with a more realistic approach of disclosure. As some wise person once said, sunshine is the best disinfectant. That's the whole basis on which conflict of interest in this country proceeds—that if you are forced to disclose, if it's a requirement that you do so, and you do so under timely conditions, then at the very least, members of the public can make up their own minds about the extent to which what you have has influenced you in terms of your own conduct and your private interest.

The language we're looking for is the language that the Northwest Territories uses. It is:

Each member shall (a) perform his or her duties of office with honesty and arrange his or her private affairs in such a way as to maintain and enhance public confidence and trust in the integrity and ethical conduct of the member; (b) arrange his or her private affairs and act generally to prevent any conflict of interest from arising; and (c) make all reasonable efforts to resolve any conflict of interest that may arise in favour of the public interest.

I have to say, that recommendation to a committee such as this in British Columbia was the most contentious of the suggestions that we made, but in the end the committee was unanimous in confirming that the language should make its way into the act.

Very quickly under disclosure, we insist on having the nature of the holdings disclosed, as opposed to the value. We don't want our legislation to become essentially an instrument to figure out the net worth of members, so we only care about how you're invested. We are concerned that we align in our act with your code the right to suspend any inquiries that have been started if a charge is laid, and so on.

Mr. Chair, I know that I'm close to my time. I just want to mention three things, which we may or may not want to discuss as part of your request for general information in our Q and A.

The first is this. Neither the code, nor our act, nor other legislation—no, I guess there's a couple of jurisdictions that have it—have an exit disclosure. It's difficult I think for members of the public to think that a person could serve for a period of time and not, at the time that they cease to hold public office, have to make a disclosure at that moment. It's hard, I suggest with respect, to argue against that.

The second is blind trust issues. We have devised in British Columbia a practical, simple, and inexpensive solution to those people who want to trade equities whilst being members of the House, both in terms of being members of the cabinet and private members. It's the only province in Canada that does it. I'm happy to share with you the arrangements that we have made with various of the large equity firms so that a member can, if they're prepared to surrender their discretion in terms of how they're invested and never actually receive a formal statement telling them what they have. What they do receive is information from time to time about how well they're doing but not what they have. They can abandon it at any time, but they can stand in the House at any time and speak with the certain knowledge that they did not know what their investments were.

As a byproduct of that, we make sure that the investment houses communicate with the members' accountants so that information that would be necessary for the filing of trust returns is communicated privately between the accountants and those people preparing the return, to the exclusion of the member.

Those are a couple of issues, sir, that you may or may not be interested in discussing, and those are my opening remarks.

I've given you my written views on the various specific recommendations made by Mary Dawson, and my lips got tired reading through them again. I'm happy to go through them, but I'm not going to be able to do it in five minutes. I'm going to assume, if I may, that members will have read them and that we can proceed.

[The Chair, Conservative, Joe Preston]

It's a good assumption that they have.

[Paul Fraser]

Thank you.

[The Chair, Conservative, Joe Preston]

Your opening statement has brought to mind a number of questions on my part. I know the members have the same reaction.

Ms. Mochan, do you have any opening at all, or are you just going to participate in our questions?

[Alyne Mochan, Legal Officer, Office of the Conflict of Interest Commissioner of British Columbia]

I will just assist Mr. Fraser, if he has a question.

[The Chair, Conservative, Joe Preston]

That's excellent.

[Alyne Mochan]

I only want to add, concerning the access disclosure statement, that there aren't any other jurisdictions in Canada that require it. That was a recommendation from the Oliphant commission, and we thought it was a good idea.

[Paul Fraser]

Ms. Mochan is here for the hard parts.

[The Chair, Conservative, Joe Preston]

That's great. It takes four or five people to provide me coverage.

We'll go to questions, then.

Mr. Lukiwski, you're first. Take seven minutes, please.

[Tom Lukiwski, Conservative, Regina—Lumsden—Lake Centre, SK]

Thank you very much, Mr. Fraser and Ms. Mochan, for being here.

As you probably know, we've been studying changes to the code and the recommendations made by the commissioner on and off for the better part of three years now, I guess. Some of the reason for that has been due to the fact that we've had other issues come before our committee, and some, I suspect, was because of our not wanting to deal with it in a timely fashion. Nonetheless, I think your appearance here today will be helpful, although I suspect it may raise more questions than it provides answers. We'll see how it goes.

I appreciate the fact that you've provided us with a glimpse of how British Columbia deals with its act.

The first question I have is a general one. You mentioned that you have an act rather than, as we have, a code and an act. One provides legislation that deals with every member of Parliament, and a second one is layered over it—that's the act—and pertains to public office-holders, those being parliamentary secretaries and cabinet ministers.

Do you think that having just one code in British Columbia is sufficient, or did you consider at any time a second layer to deal with public office-holders?

[Paul Fraser]

We've always only had simply the act, and we've always only had jurisdiction solely over members. We have no jurisdiction over public office-holders who are not members, so there's never been a need to differentiate, if you like, or to have different standards, if indeed such differentiation is necessary. We have had the benefit of simply administering a single piece of legislation. Simple is better in terms of administration.

We have recommended that we have jurisdiction over deputies and some political appointees. Those recommendations were not accepted by the committee that received the recommendations, and my sense is that they would be quite contentious. We have not had any sense, within the deputy community or within the larger political community, that the recommendations we made in respect of political assistants, and so on, would find any favour.

You've been at it a long time. We were at it a long time and have received a unanimous recommendation on some of our recommendations, but still no legislation.

[Tom Lukiwski, Conservative, Regina—Lumsden—Lake Centre, SK]

I'm just asking for your opinion on this one. In our definition of public office-holders we're talking about elected officials, whether they be members of cabinet or parliamentary secretaries. We have different standards, for anything from disclosure to...you name it.

I guess my question would be this. In your opinion, is that necessary?

[Paul Fraser]

I'd prefer to say this. On the level of disclosure and on the level of what cabinet ministers, as distinct from other members, should need to disclose or do, there is a difference, which we've been able to accommodate in our act. For example, cabinet members cannot operate a business. Believe it or not, they also cannot practise a profession, although I've dealt with that as a matter of interpretation. As long as you are just retaining membership in your profession, it doesn't amount to practising.

But there is a difference between what members of the cabinet have to abandon and what other members don't have to abandon. We've been able to provide easily for that difference in the act, which is quite a simple document.

Insofar as the larger issues are concerned—the issues of principle—my view has always been that the principles are the same. There is no need. If we were asked to provide both a code and an act and to make the same differentiation as between types of membership in the House, I would resist that idea.

[Tom Lukiwski, Conservative, Regina—Lumsden—Lake Centre, SK]

Thank you for that. I appreciate it.

I know I have only a few moments left, so I want to now go to apparent conflict of interest.

One of the challenges we've had is with definitions. For example, in the code there is a provision that talks about apparent conflict of interest involving friends. The definition of “friends” has always been a challenge for this committee. What constitutes “a friend”? Is it a casual acquaintance or someone you've been closely associated with for 25 or 30 years?

In your act, you say: For the purposes of this Act, a member has an apparent conflict of interest if there is a reasonable perception, which a reasonably well informed person could properly have, that the member's ability to exercise

And it goes on.

How do you define “reasonable perception”? Who determines that? Who is the arbiter of that? One could certainly argue on both sides of the issue, that you did or did not have a reasonable perception. How do you get around the fact that many times there's no precision on definitions that relate to conflict of interest?

[Paul Fraser]

The approach we take is a very objective as opposed to subjective one. It's not, for example, what the commissioner thinks is an apparent conflict of interest that carries the day. It's what the reasonable person thinks—reasonably well informed and bringing, fairly, an assessment to the situation. That's actually the whole basis on which the law of negligence in this country is based, and it's very much the same in our situation.

It's case by case; there's no question about it. Coming up with a formula of what will be or not be, in a black and white situation, an apparent conflict of interest has really everything to do with the circumstance that brings you to that point in time. It's why contact between our office and the members—there are only 87 of them, so it's easy to maintain it—is so valuable. People will come and do come.

[Tom Lukiwski, Conservative, Regina—Lumsden—Lake Centre, SK]

I'm sorry to interrupt, but who makes the determination of what is reasonable?

[Paul Fraser]

I do, ultimately, based on all of the information I have gathered. But I do so on an objective basis, not on the basis of the member's saying, “I didn't intend any of that” or not on the basis of my reacting to the fact that I wouldn't, in those circumstances, have reacted that way. It's as objective, I think, a set of criteria as you could possibly have. If you set out to chemically create something that was more objective, you'd have a hard time replicating what is there.

[The Chair, Conservative, Joe Preston]

Thank you.

We'll go to Mr. Scott.

There are seven minutes for you, Mr. Scott.

[Craig Scott, NDP, Toronto—Danforth, ON]

Great; thank you, Chair.

Thank you very much, Mr. Fraser and Ms. Mochan. Thanks very much for a very cogent written brief and the separate oral presentation.

I'm going to try to cover—if not in these seven minutes, then afterwards—about half a dozen structural issues, leaving aside some of the ones Tom has already talked about.

Give just a very quick yes or no or one sentence answer on this. I was fascinated by the appointment procedure. The question, though, more broadly is this. Is this done for other officers of the legislature?

[Paul Fraser]

Yes, sir.

[Craig Scott, NDP, Toronto—Danforth, ON]

It is? Okay. Thank you. For this democratic reform critic, that is a really interesting procedure that I wasn't aware of, and it has helped me think more broadly.

Second, can you elaborate a little bit on summoning witnesses and compelling documents? Does it include compelling testimony or simply summoning witnesses?

[Paul Fraser]

It certainly allows us to summon witnesses and it allows us to put them under oath. After that, I guess all bets are off. The reality is that we've had no problem. It seems that having that power is viewed by those people who are in that situation as being appropriate.

[Craig Scott, NDP, Toronto—Danforth, ON]

Okay, great.

The third issue is suspending inquiries. You would like to have in your act something parallel to ours. The first clarification is of the expression you used, “the right to suspend”. You would have the discretion to suspend, but the wording in the document suggests more that it would be an obligation to suspend. Which of the two is it?

[Paul Fraser]

I would see it as an obligation. In fact, there's a real, live example. One of the former premiers of British Columbia, Premier Glen Clark, was ultimately charged with giving a bribe in respect of construction on his summer cottage. Before the charge was laid, a complaint or a request for an opinion was made with respect to his conduct and an inquiry was launched. The inquiry proceeded. Then the charge was laid, but the inquiry continued to proceed, albeit in camera, which was something that they did rather on the wing. There wasn't anything in the act that could help them out on that.

The criminal proceedings ended with an acquittal. After that, the result of the proceedings that occurred in front of the conflict of interest inquiry was announced, and he was found to have been in conflict of interest.