Information & Ethics Committee on Feb. 16th, 2012

[John Carmichael, Conservative, Don Valley West, ON]

Do I have another minute?

[The Chair, NDP, Jean Crowder]

You have 45 seconds.

[John Carmichael, Conservative, Don Valley West, ON]

Perfect.

With regard to the monetary penalties, I wonder if you have any thoughts. In our last meeting we had quite a bit of discussion about the range of penalties that might be imposed from both sides, obviously at different levels. I wonder if you have any thoughts, as far as guidelines are concerned, that you would advise us to consider.

[Elizabeth Roscoe]

Tough.

[Michael Coates]

Just make them tough. Don't make them like a traffic ticket. They have to be tough enough that it hurts them where it counts if they break rules.

[Elizabeth Roscoe]

Pay attention.

[Michael Coates]

There's enough innuendo about our industry. We want these rules toughened up so that everybody takes them very seriously. It's in our interest, the people who are in our profession, that the penalties be serious.

[The Chair, NDP, Jean Crowder]

Thank you, Mr. Carmichael.

I'm not going to start another round because we don't have time to complete it.

I want to thank the witnesses very much for coming before the committee, and I thank the members for their questions.

We will suspend for five minutes to allow us to change to the next round of witnesses.

Thank you.

[The Chair, NDP, Jean Crowder]

I want to welcome the commissioner and staff back to the committee.

I understand, Commissioner, you have a brief statement. Then we will turn it over to committee members for questions.

Thank you.

[Karen Shepherd, Commissioner of Lobbying, Office of the Commissioner of Lobbying]

Madam Chair, members of the committee, good morning.

I am joined by René Leblanc, Deputy Commissioner, and Bruce Bergen, Senior Counsel.

I have followed the testimony on the legislative review of the Lobbying Act, and I am pleased to be here today to answer any questions the committee members may have.

[The Chair, NDP, Jean Crowder]

That is short and sweet. Thank you, Commissioner.

I want to welcome Mr. Dykstra to the committee, filling in for Mr. Del Mastro.

I yield the floor to Mr. Dusseault, who has seven minutes.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you, Madam Chair.

Ms. Shepherd, thank you for your brief comments. However, I think it would be interesting to hear your response to the recommendations made by witnesses who have appeared before us. It would surely be very informative.

I would like to begin by going back to what the previous witness said about partisan activities. He seemed to be saying that people who raise $15,000 or $30,000 for a political party and then become lobbyists or resume their jobs as lobbyists would not be in a conflict of interest situation because they would have no influence, even if they had raised a significant amount of money for a candidate during an election.

Based on your experience, and as the Commissioner of Lobbying, what do you think about lobbyists raising money for candidates? Do you agree with the witness's suggestion not to regulate partisan activities?

[Karen Shepherd]

There is a code of conduct for lobbyists. When interpreting that code of conduct, I try to determine not only whether there truly was a conflict of interest, but also whether there was a perceived conflict of interest. That approach is in line with the directives issued by the Federal Court, which clearly indicated that genuine conflicts of interest were unacceptable and that it was important there be no perceived conflict of interest.

For instance, if an individual was trying to raise $20 million and was then going to do lobbying, we would have a problem. According to the Federal Court and my own interpretation, such activities would be negatively perceived.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Of course, it's always a matter of perception. Canadians' cynicism toward politicians is exacerbated by such incidents. In other words, a conflict of interest is perceived even if it does not exist. Such a perception is damaging to politics and our democracy.

Do you think that partisan activities should be regulated and monitored, or should we leave that to the lobbyists' discretion? Is there a system that could be used to monitor all those activities?

[Karen Shepherd]

I have already pointed out before this committee that I do not look into political activities. My mandate is to focus on what happens when political activities and lobbying overlap.

When I examine a situation, all kinds of activities may be acceptable, but the concern arises when an individual decides to lobby or continues lobbying a public office holder.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

I would like to continue in the same vein. This concerns informal meetings.

Several witnesses have told us what they thought about these kinds of meetings, which were often held in specific locations and were more socially motivated. However, certain cases may have been discussed in lobbyists' presence. Ministers or public office holders were also present. In-depth discussions on cases may have been held, and lobbyists may have tried to influence decisions. Since the meetings were of a social nature and were not pre-arranged, the lobbyists involved did not report them. The act stipulates that communications should be pre-arranged. Do you think the act should be amended to include those types of meetings? I feel that some influence could be exercised during those get-togethers.

[Karen Shepherd]

Those types of social meetings must already be registered. However, in one of my nine recommendations, I suggested removing the word “arranged”. Lobbying may take place even if the meeting is not pre-arranged. For the sake of greater transparency—which is the objective of the act—I suggest that those meetings be included in the monthly report, with their exact dates.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Do you think that public office holders should also bear some of the responsibility when it comes to reporting those kinds of meetings?

[Karen Shepherd]

The act and the code of conduct impose obligations on lobbyists, who must report their activities. Imposing obligations on public office holders would change the act's objective. I think that educating public office holders and designated persons—as I am doing—is enough to ensure that those meetings are being registered. A communication verification is done every month. In addition, the letter we send to designated public office holders does not only ask them to confirm that clients are registered. They should also report any other meetings or concerns about anything else not on the list. Public office holders can ask us questions so that we can ensure a follow-up.

In addition, when I meet with designated public office holders to educate them, many of them tell me about their experiences. For instance, they may tell me that they call lobbyists to let them know that they did not register a specific meeting. They do that proactively and check every month which meetings are registered.

[The Chair, NDP, Jean Crowder]

Thank you, Mr. Dusseault.

Thank you, Commissioner.

Mrs. Davidson is next for seven minutes.

[Patricia Davidson, Conservative, Sarnia—Lambton, ON]

Thanks very much, Madam Chair.

Welcome, Commissioner and your colleagues. It's good to see you back again.

As you know, we've been having a pretty interesting study. We've heard a lot of testimony from a lot of different areas and interests. We've been getting some really good recommendations and a broad spectrum of recommendations.

A couple of our witnesses talked about the confusion between the Conflict of Interest Act and the Lobbying Act in terms of the cooling-off period. The bar association actually suggested that either the Conflict of Interest Act or the Lobbying Act—but not both—should be used to enforce that stipulated time.

Could you comment on that, please?

[Karen Shepherd]

They are different acts focusing on different aspects, but as far as the five-year prohibition on lobbying, it really ends up with me to enforce it. There is an argument that if you're looking at the five-year prohibition, it probably rests with one body. I suggest that the body responsible for the lobbying is the one that would be responsible for it.

[Patricia Davidson, Conservative, Sarnia—Lambton, ON]

Thank you.

We've certainly heard a tremendous amount about rule 8. I think just about everybody who has given testimony has talked about it in one way, shape, or another. Could you just clarify for us how your office is applying rule 8 now, and what changes, if any, you'd like to see in rule 8?

[Karen Shepherd]

Rule 8 talks about placing a public officer holder in a conflict of interest. As I was mentioning to the other member, how conflict of interest was to be interpreted came from the Federal Court case, which was Democracy Watch versus Barry Campbell, in that it introduced the notion of attention being created between the public office holder's duty to serve their public good and the obligation that might be created with the private interest. And you've probably heard that again this morning, in terms of the government relations folks or others who want to exercise their democratic right on the political activity front. That's only one example that is actually in that rule. It talks about placing and giving a gift. It may place a member in a conflict of interest when lending money. The political activity has tended to be the one that's been getting the most focus.

In developing the guidance that's out there, we considered the conflict of interest definition that exists in the other act. We also looked at the Public Service Employment Act. I was also having to be guided quite strongly by the court case, which gave pretty clear direction as to how conflict of interest was to be interpreted.

I feel the guidance is sufficient in allowing individuals to make choices. With the reports I've tabled to Parliament, there are also tools now that show how we will examine that conflict of interest. For example, in the two that I tabled, it talks about the effort and the proportion that is put in advancing the public office holder's private interest and the degree of intersection in terms of the lobbying they are actually doing.

In my mind, the guidance is sufficient. The tools are over there. From those coming forward, I have heard positive comments that the guidance has allowed lobbyists to arrange their affairs accordingly. Unfortunately, I have also heard from others that they don't like it, but they respect the fact of where the decisions come out. So I would leave it the way it is.

[Patricia Davidson, Conservative, Sarnia—Lambton, ON]

Okay.

One of the other things that I think we heard about from almost everyone was the 20% rule. A lot of people felt it just created a tremendous amount of confusion. Others felt that it was not as fair to some as it was to others. Is there a better way to define this amount or this rule? Or is the only option to either keep it at the 20% or to get rid of it? Is there another way to handle this?