Information & Ethics Committee on Feb. 2nd, 2012

[The Chair, NDP, Jean Crowder]

Good morning, and welcome to the continuing statutory review of the Lobbying Act. Welcome to our witnesses.

We'll start with our witnesses, and I believe each group is going to take ten minutes to present. We'll then go to committee members for responses.

Please proceed, Mr. King.

[Charles King, President, Government Relations Institute of Canada]

Thank you. How are you?

Good morning, ladies and gentlemen. Bonjour à tous. My name is Charles King. I'm the president of the Government Relations Institute of Canada. I am also the vice-president of government relations for Shaw Communications.

With me is Jim Patrick, who is the treasurer of GRIC, chair of our legislative affairs committee, and senior vice-president at the Canadian Wireless Telecommunications Association. I'd also like to put on the record that Jim is the one who has been spearheading our review of this act, and I want to thank him on behalf of the association.

As you may know, GRIC directly represents some 300 government relations professionals across Canada. Our membership includes consultant lobbyists as well as corporate and organizational lobbyists. GRIC welcomes this review of the Lobbying Act, as it presents government and other stakeholders with an opportunity to clarify elements of the act and its supporting framework.

Through daily practice over the past few years we have identified several areas that have served to cause confusion, not only for lobbyists, but for public servants and parliamentarians as well. This review provides an opportunity for Parliament to ensure that the rules that apply to lobbyists and public office holders are clear, reasonably enforced, and applied equally to everyone.

We have filed a comprehensive written submission with the committee, and today we'll be highlighting GRIC's five core recommendations for bringing additional clarity to the Lobbying Act and its supporting framework, while at the same time maintaining the government's objectives and Canadians' expectations when it comes to transparency and clarity in the government relations business.

At the outset, let me stress that we're not here today asking for easier rules for lobbyists. We are asking for and seeking clearer rules for lobbyists. Lobbying is a fundamental part of the political decision-making process. As lobbyists, our focus is working with our clients and government to make sure that laws and regulations are effective and practical and support the government's economic and social objectives.

Parliamentarians, government officials, business executives, and charitable organizations each have their own distinct way of talking about public policy issues and managing them. Professional lobbyists assist those unfamiliar with government in navigating the ever-changing landscape of government rules and regulations. Put in another way, lobbyists are translators. We explain business or civil society to government, and government to business or civil society.

We are hired by business and charitable groups to develop and advocate specific recommendations on legislation, regulations and fiscal decisions facing government. We are frequently approached directly by government for help on complex files.

Moreover, the vast majority of lobbyists perform these functions in total compliance with the applicable acts and regulations set out by the government.

Lobbying the government is not a privilege. It is a longstanding right that stretches back through the history of constitutional government. The vast majority of lobbyists take that right very seriously, as well as our obligations to govern our activities in accordance with the rules and regulations set out by the Government of Canada.

Since the act came into force in 2008, the overwhelming majority of communications between lobbyists and public office holders have taken place in full compliance with the letter and spirit of the act.

In other words, the majority of lobbyists, themselves, have acted in accordance with their understanding of the standards and rules set out by the government, and will continue to do so.

At the same time, the act has been interpreted and applied by the Office of the Commissioner of Lobbying, the OCL, in a way that has produced a lot of confusion and uncertainly for lobbyists and public office holders.

If the objective of the act was to provide increased transparency and accountability, the way the act has been administered has in many cases had the complete opposite effect: to confuse and muddy the rules under which lobbyists conduct their professional and, in some cases, personal affairs.

This is why GRIC has presented the committee with a short list of specific recommendations we believe would increase the predictability, transparency, accountability, and effectiveness of the regulatory framework for lobbying in Canada.

Jim.

[Jim Patrick, Treasurer, Government Relations Institute of Canada]

Specifically, we have five recommendations.

The first recommendation is that the commissioner's duty to educate public office holders should be more comprehensive. Several times it's become clear that various departments are unclear about their obligations under the Lobbying Act or about important details or definitions within the act. We recommend that OCL should have the explicit mandate to step in and request clarifications and to recommend corrective action where it's clear that a government department is offside with the spirit of the act, the same way that other officers of Parliament do.

Our second recommendation pertains to what's called the “officer responsible for filing returns”. Today the president or CEO of an organization is responsible for filing the initial registration and then all reports of meetings with public office holders. The CEO's name is the only one that appears on the monthly report, even if the CEO wasn't actually in the meeting. We're recommending that in the interest of increased transparency, the names of all lobbyists who actually participate in a meeting be listed on the monthly report—noting that there may be cases where a limited set of exemptions might be in the public interest.

Third, we're recommending that the restrictions on lobbying set out in subsection 10.11(1) of the act—this is what's called the “20% rule”—be revised, but only as they apply to former designated public office holders. There have been instances where the 20% rule has been treated as a loophole rather than a guideline. Our submission, respectfully, is that the rules should apply equally to everyone.

I want to stress that this would not impact citizens or small groups or small businesses who have cause to contact the government or their MP once or twice a year. We would limit the closing of that 20% rule specifically to former designated public office holders.

Our fourth recommendation pertains to the definitions of “oral” and “arranged” communications that are set out in the lobbyist regulations. We think those need to be clarified.

Oral communications is pretty clear: anything that's not written. There's never, however, been a formal definition of the difference between an “arranged” and an “unarranged” communication. We sought clarity on what OCL considers a reportable communication, and we were actually advised that lobbyists should be reporting “unplanned but arranged communications”.

That means that the best advice we have received from the Office of the Commissioner of Lobbying of Canada is that we should report all unplanned but arranged communications. Quite obviously, more clarification is needed around that.

However, we do not support OCL's recommendation that the solution to this is to simply erase the word “arranged” and require all oral communications to be reported. The result would be that lobbyists and designated public office holders, including members of Parliament, would have to record and report every conversation they have with each other, whether in your office or in an airport or on the street. As designated public office holders, you already have the requirement to make a record of all reportable communications and to make those records available to the commissioner, on request, to verify the reports that lobbyists file.

So if you get rid of that word, “arranged”, you would either have to make a record of all conversations you have with anyone about the government—on the offhand chance that person was a lobbyist and reported the meeting and you were then asked to verify it—or, alternatively, you would have to ask everyone you talked to about the government whether they were a registered lobbyist. That would apply in your ridings, apply while travelling, and apply while campaigning so that you know whether you need to keep a record of that conversation. Simply put, that recommendation would micro-regulate the normal interaction between MPs and the people they represent, and should not be supported by this committee.

The underlying problem here is one of definition. What does the act mean by “arranged communications”? Rather than just erasing the troublesome words, as OCL recommends, we submit that this is something that could be solved through a straightforward consultation process run by the Governor in Council to establish a clear definition.

Our fifth recommendation is associated with rule 8 of the lobbyists' code of conduct. We believe this should be removed as written, and harmonized with the existing language found in the Conflict of Interest Act and the public service post-employment rules. There have been cases where a lobbyist has been found guilty of putting a minister in a conflict of interest after the minister has been cleared by the Ethics Commissioner of ever having been in a conflict of interest in the first place. We're saying the test for determining whether a lobbyist has put a public officer holder in a conflict of interest should be the same as the test for whether that public officer holder was in a conflict of interest in the first place. It would simply be a matter of aligning the language in the acts.

In our written submission, we explain each of these recommendations in detail. We also flag some other areas that we recommend you take a look at.

[Charles King]

I would once again point out that GRIC is not here to ask for more lenient lobbying rules. We are asking for clearer lobbying rules.

What's missing today is a clear red line running through lobbying rules and regulations, a line that says on one side that this is acceptable behaviour, and on the other side that this is not. In some cases the best advice we get from OCL is to go about our business and they'll let us know later on if we're guilty of an offence.

When we put that approach alongside confusing advice such as we should report all unplanned but arranged communications, it is clear that changes to the way the act is interpreted and administered are necessary to ensure the system is predictable, accountable, and transparent for lobbyists and public office holders alike.

Thank you for the invitation to be here today. We look forward to answering your questions.

[The Chair, NDP, Jean Crowder]

Great, thank you, Mr. King.

Mr. Capobianco, are you leading off? You have ten minutes.

[John Capobianco, President, Public Affairs Association of Canada]

Thank you very much, and good morning.

My name is John Capobianco, and I'm the chair of the Public Affairs Association of Canada, or PAAC. I am joined here today by Stephen Andrews, vice-president of PAAC and chair of our advisory committee.

I want to begin our presentation by thanking the committee for inviting us here today to discuss the federal Lobbying Act and our recommendations for improving this key piece of legislation and for the public policy process.

Before addressing PAAC's specific recommendations relating to reforming the Lobbying Act, we will provide the committee with an overview of PAAC and the importance of lobbying to the Canadian policy development process.

First, PAAC is a national not-for-profit organization founded in 1984. Our principal objective is to help public affairs professionals succeed in their work by providing them forums for professional development, the exchange of new ideas, and networking. PAAC also advocates on issues that directly impact its members.

PAAC's membership represents a cross-section of many disciplines involved in public affairs, including government relations, lobbying, public relations, policy analysis, and public opinion research. Our members come from both the private and public sectors in areas such as energy, finance, small business, charities, government departments, municipalities, law and accounting firms, colleges and universities, and trade associations. At the present time we have roughly 150 members, many of whom are active in-house as organization and consultant lobbyists.

I want to make it clear from the outset that PAAC fully supports the objectives of the Lobbying Act and the need to ensure that the highest level of transparency and accountability for lobbying activity exists. We have a voluntary ethics code that complements and supplements the lobbyists' code of conduct and which directs compliance with the provisions of both the federal Lobbying Act as well as corresponding provincial statutes.

We also assist our members and lobbying regulators by holding regular educational workshops with the federal commissioner and provincial lobbying registrars. This helps to ensure that our members understand the legal and ethical requirements involved in lobbying public office holders, while providing lobbying regulators with insights into the nature of the lobbying profession.

In addition, a number of our lobbyist members have been instrumental in advocating for lobbyist registration systems, codes of conduct, and other regulatory provisions for many years at all levels of government in Canada. Our members have given testimony to the development of lobbyist registration systems at the City of Toronto as they developed the first mandatory lobbyist registration system for municipalities in Canada. Further, PAAC has a solid working relationship with the Ontario ethics commissioner and the Office of the Lobbyist Registrar and has commented on recent changes to the Ontario Lobbyist Registration Act, 1998.

Lobbying and lobbyists serve a critically important function in the development of sound public policy. At a general level, lobbying helps to build the policy and the political case for the government to act and to address an issue or opportunity that impacts a particular group--say, a region of the country, a citizen's group, a business, or an economic sector. More specifically, lobbyists provide information to government policy-makers and decision-makers that is key to the development of balanced and fair policy. For example, lobbyists routinely provide impact studies on how a proposed course of action may impact a business group, a charity, or the industrial sector.

In addition, lobbyists add value to the policy process by advising clients on how to navigate the complex decision-making process of government, including the proper timing of various communications; how to be compliant with lobbying laws, procurement processes, and codes of conduct; and advising clients and organizations on the kinds of information and policy analysis that is important in helping the government solve specific policy problems.

This list of activities is not exhaustive in the ways in which lobbyists facilitate the development of public policy, but is an often overlooked part of our job.

We believe the following recommendations will assist in improving the transparency and integrity of lobbying in Canada:

First, enable the Commissioner of Lobbying to issue advance rulings on issues covered by the Lobbying Act and lobbyists' code of conduct. Under section 10.1 the commissioner has the legal authority to issue advisory and interpretation bulletins to clarify the requirements of the act and code of conduct to ensure compliance. However, the commissioner does not have sufficient resources to issue advance rulings or advisory bulletins in a timely manner that would ensure compliance with the act and the code. While not strictly speaking an amendment to the act, we believe the commissioner should have sufficient resources to issue advance rulings to lobbyists asking for clarification on various aspects of the act and the code of conduct.

Second, reduce the five-year ban on lobbying by former designated public office holders to one year. This requires amending subsection 10.11(1) of the act. We believe the current five-year ban contained in the Lobbying Act is punitive and inconsistent with provincial lobbying law. A one-year ban is sufficient to ensure the appropriate cooling-off period and to avoid any conflicts.

Third, remove the 20% threshold for all in-house lobbying, which would involve removing the significant part test from section 7 of the act. It is clear that this subjective nature of the 20% time test for determining who is engaged in lobbying activity undermines the transparency and legitimacy of lobbying.

Fourth, expand the commissioner's duty to educate public office holders in section 4.2 of the act to say “developing and implementing educational programs to foster awareness among public office holders of the legitimacy and public policy benefits of lobbying”. We think the educational mandate of the commissioner should ensure that public office holders understand the value-added contributions that lobbying and lobbyists make to the public policy development process.

Again, we'd like to thank the committee for inviting PAAC to present our recommendations and for involving us in the Lobbying Act. As we stated at the outset, we are fully committed to improving the transparency of the regulatory system. Lobbying done well only serves to enhance the laws and policies that government develops.

We look forward to your questions.

Thank you.

[The Chair, NDP, Jean Crowder]

Thank you very much.

We'll now go to the round of questioning for seven minutes, which includes the member's question and the response from the witness.

We'll start with Mr. Angus.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you very much for the very interesting presentations.

Mr. King, I want to get right into it in terms of a recommendation on the duty to educate as per section 4.2 of the act. Can you give any examples of how this would actually work? What is needed here to deal with this aspect?

[Charles King]

That's a good question. Listen, from our perspective, the OCL's duty to educate I guess would be threefold.

Basically, I think it's incumbent upon the OCL. If they went and spent time with all the various independent caucuses.... For example, I think that in the past they've met with the NDP caucus. I'm not aware of them ever going in to meet with the Liberal caucus or the Conservative caucus. So basically, go and do that kind of expansion and explanation of the rules and of what the processes are.

As well, we're not aware of them having done that with various departments. Because you look around.... In my meetings with various officials, you ask them, just at cocktail parties, “What's your knowledge of the rules”, and it varies from department to department. Our view is that if they went out and did a very comprehensive program of educating, and not only DPOHs.... Let's go through all the departments and let's go to all the stakeholders and make sure that everybody is singing from the same bible.

[Charlie Angus, NDP, Timmins—James Bay, ON]

That's very interesting. I know that we meet with them in our caucus. I thought that was the standard procedure, because we're told there's a set of rules and we need to really understand them. So you're saying that this is not happening across the board and it's not happening through all the departments?

[Charles King]

That's correct.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay. Thank you.

I'm interested in the issue of “oral” and “oral and arranged” in the recommendation made by the commissioner. What are your views on that?

[Jim Patrick]

Before the act came into effect, we had a senior staff person from the commissioner's office come in and meet with GRIC. We had an information session for all our members. This would have been in 2008 or 2009.

In the example given to help us understand which types of meetings we need to report, the example was which types of meetings we don't need to report. The specific example was that if you're at a conference or a cocktail party and you encounter a designated public office holder, you're not expecting to see each other, and you have a brief conversation about a file, you don't need to report that, because it's not an arranged communication; you just happened to be in the same place at the same time.

It was reported in The Hill Times last year that when the commissioner met with the New Democratic Party caucus, the specific example was the complete opposite. If a lobbyist approaches an MP at a cocktail party, that is an arranged communication.

The standard seems to have shifted without any notification or consultation. We sought clarity on that, and it only served to confuse the matter further, because the advice we got was that we should report unplanned but arranged communications.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Well, I guess it's a good issue, because you could be meeting in your office; you get those little decks and it's very arranged. But you meet someone at Hy's Steakhouse, they bring you over to their table and you sit down...you can get a lot of business done there. But that doesn't qualify, then? Or you just happen to meet.... Do you think that should be covered?

[Jim Patrick]

We think there needs to be a consultation process on what exactly “arranged communications” means. Is it the definition we were given when the act came into effect? Was it the definition that apparently and reportedly has been provided to other parties?

When we've seen them try to break it down, they get into how there's a request made, there's a time interval between the request and the acceptance, and that's what constitutes “arranged”. So if I were to approach you at a cocktail party and ask you if I can talk to you about an issue, and you think about it for a second and say yes, that's now an arranged communication. If I just walk up and blurt out my issue without asking you whether you want to hear me first, then it's not arranged.

The lines are pretty vague here. We think you need to have a pretty clear process to determine what the actual definition is. We don't agree with just getting rid of the word, because it's problematic: it would require designated public office holders to keep records of every conversation about files they have with anyone, in case that person happened to be a lobbyist.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Capobianco, what do you think on this?

[John Capobianco]

I'm in agreement with that. I think at the end of the day it's common sense that prevails, and I believe if you are going to have an arranged meeting with a public office holder, it absolutely is a right to be able to record it. Most lobbyists, in fact all lobbyists, tend to do that. There are times where if you happen to bump into a public office holder at an airport or in the street and you speak about certain things, I think it gets to a point where it can get out of hand from that perspective. So I agree with GRIC's assessment on that.

[Charlie Angus, NDP, Timmins—James Bay, ON]

You're on the board of directors of the Albany Club, and the Albany Club was recently in the newspaper because of the arranged dinner for an event with the President of the Treasury Board. I'm looking at the.... It talks about it being a politically Conservative club for

“like-minded” people. We nurture our exclusivity and with that our privacy. The Albany Club is an important instrument of conservatism in Canada.

Now, obviously I haven't been invited to the club. I think one of the questions about lobbying is that it's who you know, right? It's the doors that open.

You have a club where it's exclusive. It's where you bring people together to make things happen. How do you ensure there's a sense of transparency as you speak about an accountability that if you set up a club where if you want to go and you want to meet with the right kind of people...? If I were a lobbyist, heck, man, I would have a membership there, because I could get a lot of business done.

How do we ensure there's a transparency element that you talk about?

[John Capobianco]

The Albany Club was established in the 1800s by Sir John A. and it has been established since then. It has been, I think, a great club for those who believe in conservative values, and they can join. It's a network social club.

I think at the end of the day those of us who are lobbyists who are members of the club, if we have discussions that are pre-arranged, we record them. We do that with any other.... In any other rule, if we were to meet somebody and it's pre-arranged, we would discuss and we would record it, as lobbyists.

At the end of the day, I think the club is more used for events and public policy discussions and so forth. There isn't anything else. You can have a discussion with a public office holder at a restaurant. It doesn't have to be necessarily a club.

Lobbyists by and large always will adhere to the rules that are set forward. We just want to make sure that the rules are clear.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I have many friends of mine who are lobbyists, or they seem very friendly to me when they're talking to me, which maybe is the case of being a lobbyist, but I'm concerned. We can't deal with every eventuality or every potential eventuality, but Ottawa is a pretty small town for a big city, and if you want to find out where the New Democrats are, we're not at the Albany Club. We're at Brixton's on Wednesday night. If people want business with me, they just have to be there.

[The Chair, NDP, Jean Crowder]

Mr. Angus, could you wrap this up?

[Charlie Angus, NDP, Timmins—James Bay, ON]

A lot of business gets done in Ottawa that way. How do we differentiate between pre-arranged, planned, and someone coming in? They know you're going to be there. They're going to buy you a couple of drinks, and they're going to want to get down to business.

[The Chair, NDP, Jean Crowder]

Thank you, Mr. Angus.

We'll have a brief response from the witness, please.

[John Capobianco]

At the end of the day, sir, I think it really does come down to there being rules that are set out. We want the rules to be clearer and more succinct in some cases, but lobbyists will always adhere to the rules. If we do meet with somebody, be it in a bar or in a restaurant or somewhere, and it's pre-arranged, we will record it and we will register it as we always do.

[The Chair, NDP, Jean Crowder]

Thank you.

Just before I go to Mr. Calkins, I'll note for the witnesses that you actually don't need to touch your mikes. Our technician will turn the mikes off and on for you.

Mr. Calkins, you have seven minutes.