Bill C-2 (39th Parliament, 1st Session) Committee on May 29th, 2006

[The Chair, Conservative, David Tilson]

I call the meeting to order, ladies and gentlemen. Could we have some order.

This is meeting 12 of the legislative committee on Bill C-2, an act providing for conflict of interest rules, restrictions on election financing and measures respecting administrative transparency, oversight and accountability.

Our first witness is Neil Finkelstein, partner at Blake, Cassels & Graydon. We have your curriculum vitae. I don't know how we got it, but we have it here. You certainly have some impressive credentials. Lately we've recognized you as a TV star in the Gomery commission.

[Neil Finkelstein, Partner, Blake, Cassels & Graydon LLP, As an Individual]

They cancelled my show, sir.

[The Chair, Conservative, David Tilson]

That's too bad. In any event, we're honoured that you have come here tonight to share your thoughts with us. You know the rule. You have a few introductory comments and then the members of the committee will have some questions of you.

Welcome, sir.

[Neil Finkelstein]

Thank you, Mr. Chairman and honourable members, for inviting me to appear before you.

I should say I don't have any expertise or experience in many areas of the bill. I assume I was invited here because I was co-counsel to the Gomery commission. I may have some thoughts on several parts of the bill as a consequence of that. I examined panels headed by the Clerk of the Privy Council and by deputy ministers of Treasury Board, PCO, Finance, and PWGSC, which gave me some insight into the interrelationship between the public service and elected members. That may help me comment on various parts of the suggested amendments to the Financial Administration Act. I examined Mr. Chuck Guité. You'll recall that in three days of cross-examination he told me a story different from the one he told the public accounts committee, about who made what decisions and what his reporting relationships were. Again, that may help me comment on the accountability provisions in the FAA.

I examined Mr. Allan Cutler, who was the whistle-blower, and that may enable me to comment on the whistle-blower provisions in the act.

I have comments on three parts of the act. The first is quite discrete. It deals with the removal of the right of employees in ministers' offices to be appointed without competition. Under the Public Service Employment Act, Mr. Gagliano's chief of staff, Mr. Tremblay, was appointed without a competition to Mr. Guité's group and succeeded him as head.

There's no question that there have been a number of excellent public servants who have come through ministers' offices and gone into the public service who are now deputy ministers. That being said, in my view this is a good provision. There is a perception of favouritism and there is a perception of conflict. Certainly I think that was the case in front of the Gomery commission.

The second area I would like to comment on is the whistler-blower protection provisions. It is important to have a fair process to resolve whistle-blower cases. There's a real need to balance a fair and open process for whistle-blowers, including freedom from reprisals, on the one hand, and the legitimate needs of public servants to perform their functions without intimidation or fear of witch hunts on the other. So you have to have a legitimate avenue for complaints. You have to have a decision-maker who has expertise in all of the aspects of government who can balance the interests, and you have to have a fair and expeditious—and I'd underline expeditious—procedure. I think the bill, by and large, is a good process.

I would like to focus on the reprisals part. Complaints are made to the commissioner who presumably has expertise. Proposed section 19.3 on page 130 of the bill provides that the commissioner can refuse to deal with a complaint where it's been adequately dealt with elsewhere, or it's not made in good faith. I think that is a very important gatekeeper function to perform for the health of the public service generally. I should say that gatekeeper function is a lot like the one established in the Competition Act. I see in this bill dealing with whistle-blowing many analogies to the Competition Act, a statute that I'm quite familiar with and have litigated many cases under.

I also would point to the provision in proposed section 20.4 on page 136 of the bill, where only the commissioner may apply to the Public Servants Disclosure Protection Tribunal. The tribunal itself is staffed by judges, which on the one hand is good. They're above reproach; they're above conflict. The concern I have—and I'm a litigator—is that the litigation process can be time-consuming and can have a great deal of machinery associated with it, and that has to be avoided.

I'll say that in this bill, proposed section 21 on page 139 is important, and I underline it. It says that the proceedings have to be informal and expeditious. Notwithstanding that they're in front of judges who are used to court-like processes where the rules of evidence must be followed, it nevertheless provides for an informal and expeditious procedure. As long as that's followed, that would deal with this concern.

The third area I'd like to make comment on concerns the amendments to the Financial Administration Act that make accounting officers—essentially deputy ministers—accountable before Parliament.

The amendment contemplated in proposed section 16.4 of that act, which is page 174 of the bill, makes the deputy minister accountable before Parliament within a framework of appropriate ministerial responsibility and accountability to Parliament.

Again drawing on my experience at Gomery, there is a need to at least answer to Parliament. The fact is that deputy ministers answer to Parliament and parliamentary committees now; deputy ministers can be called in front of a committee now. But this codifies the obligation to answer, and I think this might—I say “might”—create a situation where there is less likely to be communication and reporting on a regular and continuous basis by a mid-level bureaucrat outside the chain of command.

There has to be, however, a clear distinction between answerability and accountability, because you should not set up a dichotomy where you have duelling between the public service—unelected people—and elected representatives. The responsibility for policy has to be with the elected representatives. In principle, there must be great care taken not to blur the lines of responsibility and to inadvertently make deputy ministers accountable for policy decisions.

I think this bill largely deals with that problem. This bill in that regard is carefully drawn in three respects. First, it provides that the accountability of the deputy minister is within the framework of the appropriate minister's responsibility and accountability to Parliament. That underlines the constitutional principle of responsible government.

Second, proposed paragraphs 16.4(1)(a), (b), (c), and (d) of the Financial Administration Act provide that the deputy minister is accountable in relation to the organization of resources of the department, internal control, signing of accounts—he should be responsible for that—and, the one I would be concerned about, duties “in relation to the administration of the department”.

In my experience in this case, administration can shade into policy. I think it's clear from proposed paragraphs (a), (b), and (c) that the intention in proposed paragraph (d) was that the accountability not shade into policy. But one of the things you might want to consider is making that explicit.

Subject to that, Mr. Chairman, in my view this is a very good effort to balance the interests. Care must be taken, though, not to inadvertently blur the lines. As far as I'm aware, this is the first time—I stand to be corrected—in a common-law country such as ours that the obligation has been codified as it is here. That's not to say we shouldn't be stepping into unchartered waters. Columbus never would have discovered America had he been afraid to move into unchartered waters. But it is to say that care has to be taken not to deal with anything more than the problem this is established to deal with.

Thank you, sir.

[The Chair, Conservative, David Tilson]

Thank you, Mr. Finkelstein.

Mr. Thibault.

[Robert Thibault, Liberal, West Nova, NS]

Thank you, Chair, and thank you for appearing and for your comments. I have a couple of questions and then I'll leave it to the official critic.

One of the suggestions you made--not that I necessarily disagree with it, but I would like to discuss it a bit--is that question of appointing without competition staff who have worked in the minister's office for three years, and that question of perception of fairness or of competition. For argument's sake, I would challenge that they did have a competition. I would argue that these employees, these exempt staff, did go through competitions. They went through competitions to get hired in the minister's office. They survived three years of competition to maintain that position, which is a very difficult area of work.

[Neil Finkelstein]

There's competition in politics, sir.

[Robert Thibault, Liberal, West Nova, NS]

I understand that.

The other thing is these individuals do gain incredible knowledge in that area that you referred to later in your comments as that grey area between policy and responsibility or administration and definition or elaboration of policy. I'm reminded a little bit about the law clerk. When he or she graduates, they are invited by competition to article with a firm such as yours. Once they go through their articling process and achieve their admission to the bar, they may be invited to remain with that firm without competition, that is, without having to go through a formal competition process that somebody who might be coming into that firm as an associate would go through.

Those are the distinctions I make. I'm fearful that we will have a position where we do not encourage young women and men of great capability to come into political service, working for ministers and MPs, with the knowledge that there is one advantage they would have: that they would not be losing those years they worked on the political side of public service, that those years would not be lost to them in a career that they might have as a public servant.

I've always found that it maintains a good balance. I've had the opportunity to work with very good women and men who evolved in the Mulroney age and who are now at the deputy minister and ADM level and have the full capability of operating their department or their branch of a department without political consideration in service to the public.

I'd ask that you comment on those points.

[Neil Finkelstein]

Yes, sir. I opened on that point by saying that it is my understanding that there are some excellent people at the senior reaches of the public service right now who have gone through the ministerial office route. I guess, though, I would reiterate the points I made. I'm not from government. I'm an outside lawyer and I arrived in Ottawa for a time, stayed, and left. I won't speak for the people in the commission. You can read the report yourself, but there was at least a perception of favouritism and conflict. That's the perception.

On your particular points, you say there's a competition already. It's a different competition. It's a competition in front of ministers rather than the public services. That's point one. You say these individuals obtain incredible knowledge. I accept that, and I've said that there are some excellent people in the process, but there's more than one way to obtain that knowledge.

You speak about clerks. I had the great good fortune to be law clerk to Chief Justice Bora Laskin at the time of the patriation case. There was only one law clerk per judge in those days. It was a wonderful year, and when I completed my term as his clerk, the rule was that I was not to appear in front of the Supreme Court of Canada for two years, and I didn't, because of the perception of conflict.

[Robert Thibault, Liberal, West Nova, NS]

The other point perhaps that is missed in your comments is the fact that once they leave a minister's office and apply to the public service, these individuals are evaluated by the Public Service Commission. They must meet the criteria for entry, and they enter at a level in accordance with the criteria. It's not as if you leave a minister's office after three years as a junior staff member and you're deputy minister the next day.

[Neil Finkelstein]

No, but my understanding is there isn't a competition. You may be qualified but be less qualified than somebody else. That's my understanding of what a competition is.

[Robert Thibault, Liberal, West Nova, NS]

Well, you could argue that, but you could say there is nobody who could possibly be as qualified as you are, because the experience you gained working in a minister's office can't be replicated in a university or work setting other than that. So I think it would be difficult to make the competition. That's the only consideration I would have on those points.

It's not a deal breaker to me, but I find it discouraging or worrisome that we would lose in the future those young women and men of all political stripes from ministers' offices who are of great ability and are willing to work long and hard hours under difficult circumstances and to contribute greatly to the process—but with the perk and understanding that they will be able to have access to the public civil service if they are capable. If they are not capable within three years, they will have either brought their minister down or will have been replaced. So I don't think from the capacity side that it's that huge of a problem.

[The Chair, Conservative, David Tilson]

I'm sorry, but we're out of time. You'll have to wait until the next time—if we have one.

Mr. Sauvageau.

[Benoît Sauvageau, Bloc, Repentigny, QC]

It is an honour and a privilege to have you with us today, sir. Thank you for being here, and for having agreed to share your experiences of the Gomery Commission with us; although, I understand, of course, that that does not constitute the sum total of your experience. My questions will seek to establish a parallel between the conclusions of the Gomery report and the content of Bill C-2.

When she appeared before the Gomery Commission, the Auditor General said that the sponsorship scandal happened because, although rules existed, they were contravened, flouted and disregarded. She reiterated this sentiment to the committee when she said that the problem was not a lack of ethics rules in the government, but a lack of commitment to enforcing them.

The Conservative government is proposing Bill C-2 as an antidote to a problem it believes exists within the public service. Do you think this bill is seeking to rectify a real problem or, rather, the perception of a problem? In simple terms, are more rules needed, or is it simply a matter of enforcing the existing rules?

[Neil Finkelstein]

I've only commented on three areas of the bill. I regard those areas as extremely important, but none of them imposes additional rules, as I understand it. What they do is provide additional process. Ms. Fraser was right: there were substantive rules in place and they weren't followed; there were reporting relationships that weren't followed; and there was a reprisal against Mr. Cutler, which has highlighted the lack of a process.

So on the whistle-blower point, there is now a process, and you heard my comments on it.

On the respect for the rules, there is this codified process, where the deputy minister is accountable before Parliament and must answer to Parliament in relation to the administration of his department. Would that change the outcome in the sponsorship scandal? It's very hard to tell in any one particular case what would happen. But I think what would certainly be the case is that the deputy minister would understand that on a regular and continuing basis he has a statutory obligation to answer, and that might—might—have made him more careful to ensure there wasn't the reporting relationship between Mr. Guité and others that there was.

[Benoît Sauvageau, Bloc, Repentigny, QC]

Treasury Board also knowingly failed to implement the oversight mechanisms that it ought to have applied. Ms. Fraser told us that, at that time, there were about 72,000 rules in place on accountability, responsibility, and so forth — I do not know whether that is an exaggeration — and yet additional ones are now being introduced.

Firstly, with your indulgence, I would like to address the matter of perception. According to the Conservative government, Bill C-2, amongst other objectives, aims to correct both problems relating to poor public service management and public perception. I asked a witness who is an expert in this field whether other countries or other Canadian jurisdictions had introduced similar pieces of legislation that had successfully resolved problems of public perception, an outcome that is, after all, a stated objective of the bill. His answer was no.

When we studied the bill that created the post of ethics commissioner, as well as introducing both an ethics code for members and ministers and an ethics code for senators, some people said that it was an attempt to improve public perception. It has now been two or three years since the post of ethics commissioner was first created, but I do not think that the Canadian public now have a more favourable image of Parliament. You argued that ending the practice of making appointments without holding competitions would correct the problem of public perception. To my mind, it may improve the image of Parliament in the eyes of those who are following the committee's work, but not in the eyes of the public in general.

I therefore think that there is a world of difference between the bill's stated objective and what it will actually achieve. That does not mean that we should do nothing. I would like to hear your views on this.

You told us about those aspects of the bill that you believe constitute positive measures, such as protecting whistleblowers and putting an end to the practice of making appointments without holding competitions. However, should you consider some of the bill's provisions to be less desirable, even if you have not mentioned them today, I would ask you to send your comments on them to us, through the chairman or the clerk, so that we can improve Bill C-2. Although you made some positive comments, I am certain that you do not consider the bill to be perfect.

I would therefore ask you to send us any comments or suggested amendments that you would like to make.

[Neil Finkelstein]

To be fair, sir, I think I said that by and large I thought the provisions I commented on were positive. I don't think I used the word “perfect”; I think that may be your word.

What I did say in relation to whistle-blowers is that there must be care taken that the process be expeditious.

What I said in relation to the reporting to Parliament was to suggest an amendment that for greater certainty the answerability not extend to policy issues.

In terms of your comments about perception, I'm not a pollster. I can't really help you there; that's your job. All I can do is suggest that there are areas where there might have been a problem, and that this might be a step in the right direction.

[The Chair, Conservative, David Tilson]

Okay, we're going to have to move on.

Mr. Dewar, Mr. Martin, which one of you wishes to speak?

Mr. Dewar.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you, Chair, and thank you for your presentation.

I would like to go through the three areas you commented on. I'll start with the first topic you brought up, and that is the politically exempt staff and how that works.

For the record, in fact, I disagree with my friend down the way. I would like to have seen retroactivity in this, particularly when we saw just after this election, yet again, people being dropped into various ministries. I'll tell you, as someone from Ottawa, as someone who represents public servants, it creates within the public service, to put it mildly, a little bit of resentment to watch people cut the line and without merit--we talk about competition, it's about the merit principle here--be able to get positions that other people have to wait for and apply for. That's just a comment.

The other area we haven't talked about is the reverse situation, and that is where people are brought from and seconded to political staff. I'd like you to comment on that. That's happening. There are people in this town, and I've actually talked to some, who--and I'm not sure we know how many--aren't political staff who go into the public service, but they are public servants who are seconded and brought into a political job. I'd like your thoughts on that.

Secondly, we've talked about the fact that we need a fair process, an expedient process, to protect whistle-blowers from reprisals. I'd like to get your comments on the composition. You touched on it and Mr. Cutler touched on it--the fact that maybe we shouldn't just have judges, but maybe others could be involved, and also, as a last resort, that the courts be an option. If so, what kind of support would a whistle-blower have? Should it be beyond $3,000 or beyond $1,500, considering that sometimes whistle-blowers are fighting a department that's fairly well stocked, if you will, with resources?

The final one is about your comments about policy and accountability. I note that in the Gomery recommendations there are various things that could deal with that. When we look at codifying, having a public service charter is part of recommendation 2, but there are also some comments about the length of time a deputy minister serves. There's been a real concern in this town about the fact that deputy ministers aren't around long enough. I can certainly see a problem if you're asking deputy ministers to be more accountable. It's very difficult if you've only been there for six or eight months. How can you be accountable if you haven't been there? I'd like your comments on that, because it was in Gomery and it's been identified by other policy-makers and people who look at policy. They also talked about committees having enough resources, so that the public accounts committee, in particular, can have a deep enough well to draw from to do their job.

I'll stop at that.

Thank you.

[Neil Finkelstein]

On your question about public servants going into political jobs, I have no comment. My experience was the other way, and my comments really were limited to that. Without commenting on whether it's a good or a bad thing, it raises different issues.

When a political person goes into the public service, it raises an issue different from when a non-partisan person goes into a partisan situation. There may be issues if that civil servant goes back, but that's beyond the scope of this bill, as I understand it.

Concerning the composition of the tribunal, I told you about the Competition Tribunal. The Competition Tribunal is made up of Federal Court judges and lay people with expertise, so that's the tribunal I'm most familiar with. They sit as a quorum of three. There must be one judge; one lay person, who is generally an economist; and then one other person, who is either a judge or an economist. There are either two judges and one economist or one judge and two lay people.

That would be another way, certainly, to go here--people with expertise in government and judges forming a heterogeneous panel.

In terms of court as an option, my view is it would not be a good option. In fact, my comments were actually the opposite. My comments were that the difficulty with a court is it takes a very long time, it's public, and in many situations you can do terrible damage to an innocent person's reputation--either the whistle-blower or the person upon whom the so-called whistle was blown. It would be very unfair to that person to have that made public over a long process. These things have to be dealt with expeditiously.

So I would not have court as an option.

In terms of the recommendation that there be a hard and fast rule that deputy ministers be changed, again I don't see that as being part of the Federal Accountability Act. I think it really would work on a case-by-case basis, though.

It's always the issue of experience versus the need for change. Sometimes you want experience and you wouldn't want to be forced to rotate it out; sometimes you want change, and there you are.

[The Chair, Conservative, David Tilson]

Thank you, sir.

Monsieur Petit.

[Daniel Petit, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Finkelstein, I have a question for you. As you know, a whistleblower would be more comfortable appearing before independent judges than he would be appearing before a government body, which could be subject to pressure from the government. We know full well that such bodies do not have the same independence that superior court judges have long enjoyed.

Bill C-2 recommends that the tribunal comprise independent judges, such as Justice Gomery. Justice Gomery was chosen partly because he was independent of political power or influence. Relying on a government body, no matter which one it is, could create a problem. Take the example of somebody who is appointed for four or five years; when he reaches the end of his mandate, he could be offered a renewal of his contract, a higher salary, a bigger office, and so forth, on the condition that he toe the party line. A lot of pressure can be brought to bear on a government body. In Quebec, we experienced a similar situation with the administrative tribunals.

Have you reflected upon the fact that a whistleblower would undoubtedly feel more comfortable before superior court judges, given their long-recognized judicial independence?

[Neil Finkelstein]

We're talking about reprisals now. This tribunal deals with reprisals, not with the original complaint. The first complaint about the reprisal goes in front of a commissioner, who is not a judge and who has the authority to either not follow through on the investigation--I pointed out that provision--or not to bring proceedings. So it's not dealt with by a judge at all levels, but only when it gets to a certain level in the process.

When it gets to the tribunal, you'll recall that in my opening comments I said there were advantages to using a judge. The one I gave was the independence, the tenure.

My real comment was that care has to be taken to make sure that proposed section 21 is applied, that the process is expeditious and effective. And there are overly court-like procedures. That's not the bill. The bill says proposed section 21 should be informal and expeditious.

I simply caution you that there's a similar provision in the Competition Tribunal Act, that proceedings should be informal and expeditious but consistent with fairness.

I have done four contested merger cases in the Competition Tribunal. The longest one, by the time it got to the Supreme Court of Canada, took seven years. The shortest one, which didn't go past the tribunal, took a year and a half. So that's not an issue with judges; it's an issue of making sure that “informally and expeditiously” means just that.

[Daniel Petit, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Finkelstein, I know that you have read the bill and that you know that a whistleblower is somebody who has not been involved in a crime, but who has disclosed a crime or an act of wrongdoing. What is your view on what we refer to as the Repentant Witness Act? By repentant witnesses, I mean people who were involved in the crime in question, but who testify against others to get a shorter sentence. This is something that happens. How do you perceive the two pieces of legislation as being related? Have you studied this aspect of the question?

[Neil Finkelstein]

I'm sorry, sir, in what respect? I don't mean to be facetious. I don't understand the question. My comment really was on the process. I'm not sure that whether a person is an innocent or a repentant wrongdoer really makes a difference in the sense of the way the process plays out.