Information & Ethics Committee on Feb. 4th, 2013

[The Chair, NDP, Pierre-Luc Dusseault]

Good afternoon, everyone. Welcome to the 62nd hearing of the Standing Committee on Access to Information, Privacy and Ethics.

We will continue—

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

Excuse me, Chair. I have a point of order.

[The Chair, NDP, Pierre-Luc Dusseault]

If this is a point of order, go ahead.

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

I'm very glad that we have our witnesses here with us today.

As you see, we have committee business regarding the breach of data on 580,000 Canadians who've had their private financial information breached. I don't know about my other colleagues, but we've certainly been getting lots of calls in our offices from people whose data has been breached, and they're very concerned.

I would think it might be useful for us to actually just move that up in business so that we can get that dealt with, so that we can bring witnesses on this issue.

I'd like to move that up first, and then we can hear from our witnesses.

[The Chair, NDP, Pierre-Luc Dusseault]

You want to change the agenda?

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

Yes. I would like to move it up because of the seriousness of the breach and the fact that it is affecting one in 60 Canadians across the country. We need to know what's being done with people's data and what kind of steps are being taken to ensure their protection.

[The Chair, NDP, Pierre-Luc Dusseault]

We have to obtain unanimous consent.

Is there unanimous consent? Do you want to continue the debate, Mr. Warkentin?

[Chris Warkentin, Conservative, Peace River, AB]

Thank you.

I think the clerk may have something to—

[The Chair, NDP, Pierre-Luc Dusseault]

Just a minute. Ms. Borg had the floor first.

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Thank you very much.

It is extremely important that we study this matter. We are indeed the Standing Committee on Access to Information, Privacy and Ethics. At Human Resources and Skills Development Canada, information concerning over 500,000 Canadians was lost. We have to know what happened and how we can prevent this from happening again.

We must study this in the near future. We must do this for Canadians, especially those who were affected and who have questions. They want to know how this happened and if this will happen to them again. It is extremely important that we put this forward and that we study this issue properly. That is the responsibility of our committee.

[The Chair, NDP, Pierre-Luc Dusseault]

Do you want to continue on the point of order, Mr. Warkentin?

[Chris Warkentin, Conservative, Peace River, AB]

Thank you. I do appreciate the opportunity.

Obviously those of us around this table find this incident to be absolutely unacceptable, completely unacceptable. I can tell you that the minister has made that clear. Obviously Canadians know that.

The Office of the Privacy Commissioner has been contacted with regard to this and has been made fully aware of it. As well, every one of the clients whose information was involved in the breach has been contacted. They have been offered all kinds of protection in terms of Equifax protection and the rest.

It's an important issue. I don't think anything is going to change in the next hour and a half, so I'd like to see that deferred to the end of the meeting. I think this is an important discussion that we need to undertake, but we do have witnesses waiting here, and I think it would be appropriate that we hear from them.

In an hour and a half's time, I think we can move to deal with this in future business, as it was pertaining to our committee's schedule. At that time I think we'd be able to have a good discussion, but be able to first honour our witnesses who are here. They have taken time out of their day to be here, and I don't want to squeeze them out.

[The Chair, NDP, Pierre-Luc Dusseault]

Since there is no unanimous consent, we are going to respect the agenda as it stands.

Today, we are beginning our review of the Conflict of Interest Act. We have two witnesses, first of all Mr. Greene, from York University.

Thank you for being here.

We also will be speaking with Mr. Gregory Levine, via videoconference. I thank Mr. Levine also for being here.

We will move on to testimony immediately. In keeping with our usual practice, each presentation will last 10 minutes, and afterwards we will have a question and answer period.

I yield the floor to Mr. Greene, who now has 10 minutes.

[Professor Ian Greene, University Professor, McLaughlin College, York University]

Thank you very much. Merci beaucoup. It's a great pleasure to be here today. I really appreciate the invitation. I'm particularly pleased, because there are at least two members of this committee from my home province of Alberta. I recently discovered that my dad was dentist for the member for Red Deer, as well as for me.

Advancing ethics legislation is a bit like pulling teeth. It almost always comes as a result of a scandal. Sometimes it comes as a result of thoughtful deliberation. I'm really hoping that the recommendations that are discussed today can be proactive and can prevent future scandals as a result.

I spent four years working for the Alberta government—three years as a middle manager for social services, and one year as an assistant to a cabinet minister. During these four years, Peter Lougheed was the premier. He set an example by having unimpeachable ethical standards. He was in large measure part of my inspiration for the study of ethics in the public sector.

There are two points I want to make today. First of all, the conflict of interest regimes in Canada that work the best are those that require elected members to meet in person with the Ethics Commissioner or someone in the commissioner's office on an annual basis to discuss the member's disclosure statement. Secondly, I think it's important for this committee to re-examine the recommendations of part III of the Oliphant commission report that are within the jurisdiction of this committee, and to consider implementing the recommendations that haven't already been implemented.

First of all, compulsory meetings with the ethics commissioner—what became known as the Canadian model of the prevention of conflicts of interest involving elected members—began with the creation of the position of an independent conflict of interest commissioner, now referred to as the integrity commissioner, in Ontario in 1988. The Ontario legislation provides that all MPPs must submit a confidential disclosure statement to the commissioner within 60 days of an election, and that they have to meet in person with the commissioner to discuss that statement within another 60 days. Usually it's a lot quicker than that on both counts. The disclosure statements have to be updated annually, and there are required annual meetings, once again, with the commissioner. The commissioner also has the power to investigate complaints about alleged violations of the rules. On average, there has been an inquiry about once every two years.

From its inception, the Ontario approach was meant to be primarily educative, and thus preventive, and only secondarily investigative. The approach has been highly successful. The number of serious allegations of breach of conflict of interest rules dropped on an average annual basis by 90% after the new regime came into effect. Because it has worked so well, it has been copied in every jurisdiction in every province and territory across Canada, and now for the Senate and the House of Commons with some varied approaches. Now we are getting into the municipalities as well.

In every instance where this Canadian model has been instituted, there has been a drop in the number of allegations of conflict of interest. The least successful regime in terms of reducing the need for inquiries about allegations of breach of the rules is unfortunately the House of Commons and the cabinet. More allegations of breach of the rules are investigated by the Conflict of Interest and Ethics Commissioner per member than for any other legislative body in Canada. I think this is because there is no requirement to meet with the commissioner or someone in the commissioner's office. Between 2004 and 2010, the commissioner conducted annually, on average, four inquiries into credible allegations of breach of the rules. This is far too many. It leads to negative publicity about the person being investigated. This isn't the fault of the commissioner. It's because of the weakness in the preventive part of the Conflict of Interest Act.

In my experience, the great majority of the elected members in every party are honest. They enter into politics to serve the public good.

Most of us think we're ethical so we don't need to pay close attention to the rules, but conflict of interest is not always an easy concept to understand in some situations. That's why it is useful to obtain the personal advice of the Ethics Commissioner or one of her staff. As well, once personal contact has been established, it's more likely that an elected member will go to the commissioner or the commissioner's office for advice when unusual situations arise.

In Ontario, MPPs request advice from the Office of the Integrity Commissioner five to seven times a year on average. From what I can understand from Commissioner Dawson's report, it might be once or twice a year for the House of Commons. These informal inquiries are part of the preventive approach of the Canadian model, and they're more frequent once you have these compulsory meetings that not only help prevent conflict of interest in individual situations but create a rapport, trust, and a willingness to use the system.

Up until 2012, Commissioners Shapiro and Dawson between them had issued 19 reports resulting from investigations into allegations that MPs or cabinet ministers had violated either the code or the act. I've read all of the reports that resulted from these inquiries, and I've concluded that many, if not most, of these 19 inquiries would have been unnecessary or would have been much shorter had there been a previous personal meeting between the commissioner and a cabinet minister or a staff member and the MP.

My second recommendation is with regard to the recommendations of the Oliphant commission. Part III of the commission's report contained a number of recommendations for the Conflict of Interest and Ethics Commissioner, Mrs. Dawson, who has implemented all of them, for the Prime Minister's Office, and for this committee. I contacted the Prime Minister's Office to find out if they are contemplating implementing these recommendations. I got an acknowledgement, and they said they would get back to me, but I'm still waiting.

A number of recommendations affect this committee and its jurisdiction. I'm not sure if any of the recommendations have been implemented yet, but if not, I'd like you to consider them.

With regard to the educational role of the commissioner, the commissioner's office runs voluntary training sessions on the Conflict of Interest Act and Code. Only about half of the MPs attend, according to Mrs. Dawson's annual reports. Very few ministers attend. Oliphant recommended that attendance at these training sessions be compulsory for ministers and that party leaders should make them compulsory for their MPs.

It was recommended that after the filing of disclosure statements under the act and the code, there should be compulsory in-person meetings between the staff in the commissioner's office and the ministers and MPs, as is the case in most Canadian jurisdictions, including the Senate. To date, there haven't been any inquiries conducted by the Senate Ethics Officer. I think it's because the required annual in-person meetings have an effect in terms of preventing behaviour that could lead to allegations of conflict of interest.

The conflict of interest and lobbying rules have improved greatly in Canada since 1993-94. They are now amongst the most rigorous in the world, but there are still some loopholes that I think need addressing.

What Oliphant recommended was that the definition of employment in the Conflict of Interest Act should be clarified:

employment shall mean...any form of outside employment or business relationship involving the provision of services by the public office holder, reporting public office holder, or former reporting public office holder...including, but not limited to, services as an officer, director, employee, agent, lawyer, consultant, contractor, partner, or trustee.

In regard to the Conflict of Interest Act, Oliphant recommended that the definition of conflict of interest should be broadened to include an “apparent conflict of interest”. For example, this is the case in British Columbia and some other jurisdictions. It simply ensures that the legislation goes a little bit further to require members to observe the highest standards.

The Conflict of Interest Act should be amended so that post-employment provisions clearly refer to work done in Canada or anywhere else, according to Oliphant.

The Conflict of Interest Act should be amended to prohibit public office holders from awarding contracts or benefits to persons who may be in violation of the code, and if these public office holders are uncertain, they must check with the Ethics Commissioner.

The act should be amended to make it a non-criminal offence to fail to meet disclosure obligations.

As well, there should be an appropriate appeal mechanism regarding post-employment decisions of the commissioner that involve procedural fairness and transparency.

In conclusion, I think the Conflict of Interest Act has done a lot of good. It's always a work in progress. In Ontario, the legislature, every once in a while, acts proactively to tighten up the rules, instead of doing that because of scandals. I very much hope this committee will consider doing the same thing.

I look forward to your questions.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you very much for your presentation.

We will now be joined via videoconference by Mr. Levine, who is in London, Ontario.

You have 10 minutes for your presentation.

[Gregory J. Levine, Lawyer, Ethics Consultant, Social Scientist, As an Individual]

Thank you.

The first thing I'd say is that I would endorse and echo what Professor Greene has just said to you. His recommendations make abundant sense to me.

Thank you for the chance to speak to you today.

The enactment of the Conflict of Interest Act was an important step in the evolution of an integrity and ethics system. While it's significant and welcome, there are ways in which it could be enhanced. Today I'd like to talk about a few of those ways in which it could be enhanced, including: the insertion of “apparent” conflict of interest; tightening post-employment restrictions; ethics education; and whether or not the enhanced use of administrative monetary penalties recently called for by the commissioner will transform the nature of the legislation, and whether or not that's appropriate.

Before looking at those issues, I'd like to make three general comments. One already has been made by Professor Greene. The first is that the Oliphant commission made several recommendations specifically aimed at the Conflict of Interest Act. To my knowledge, none of them have been implemented. I'll touch on two very briefly, but I think they all should be implemented.

The second general comment I have to make is about the approach of the act to the role of the commissioner. The commissioner is an adviser, a monitor, and an investigator. Unlike most of the provincial, territorial, and municipal commissioners, the commissioner has considerable power to order compliance, but not to penalize, except with administrative monetary penalties.

In her written submission as it appeared on her website, the commissioner now seeks enhanced penalty power, albeit in limited circumstances. As the act now stands, though, she's really more of a specialty ombudsman and is so as well under the members' code. In both contexts, this role is as a specialty ombudsman, similar to most other ethics commissioners in the country. As a general comment, I'd just say that if you're going to transform that role you ought not to do it lightly. I'm going to come back to that in a second.

The third broad observation is that the act deals with much more than conflict of interest. It's called the Conflict of Interest Act, but it deals with behaviours that are beyond conflict of interest: influence of office, misuse of insider information, inappropriate acceptance of gifts, and so on. Conflict of interest, classically defined, is about an opportunity, a potentiality, that is the opportunity or potential to make a decision in one's public role that will further one's private interests.

The act describes ways of avoiding that and so on, but other things, such as improperly influencing an action, for instance, are well beyond conflict of interest. It's misbehaviour. This goes to one of the things the commissioner has called for, and that's an enhancement of the purpose section of the act, which I would support.

I'd also suggest that it would be useful to do as Ontario's Members’ Integrity Act does, which is to have a preamble that clearly states the need for ethical behaviour in government and the aspirations to which the act applies. I don't know if it's necessary to change the name of the act, but I do think that guidance is useful.

I'd like to now comment on specific areas. The first, Professor Greene has already dealt with. The recommendation of the Oliphant commission that “apparent” conflict of interest be adopted and placed in the act I think is very important. I understand that there has been an argument which suggests that because perceptual language occurs in other parts of the Conflict of Interest Act, you need not define apparent conflict of interest. That's not correct, I respectfully submit.

We've had two commissions at the federal level, the Parker commission long ago, and the Oliphant commission, which have dealt with this and have called for the inclusion of this kind of standard. At the municipal level in Ontario now, both the Bellamy and Cunningham commissions have also called for it. I think it's just time to do it.

In terms of post-employment restrictions, again, Professor Greene has discussed this so I won't canvass it, but I think the definition of employment is one area that should be dealt with as Oliphant recommended.

The third area I wanted to talk about, which has been canvassed by Professor Greene much better than I could, is education and training. I would just say that I support the notion that there should be mandatory training. A requirement for public office holders to undertake ethics training and annual review of such training is not unreasonable.

I've dashed along here, but I'd just like to talk about administrative monetary penalties for a second. In general, there are limited consequences for breaching the rules in the act. It does contain administrative monetary penalties. It also contains order powers for the commission to enforce compliance, but it does not have any specified penalties for failure to meet the key substantive rules.

One senses that this is the case for two reasons. The commissioner is to report breaches to the Prime Minister, and it is presumed that the Prime Minister of the day would act in some way to deal with the person who has breached the rules. Also, the reports become public, and the light of day is its own cleanser, if you will.

In her written submission, the commissioner has called for an extended ability to levy administrative monetary penalties in limited circumstances, but also asks you to consider penalties for a more substantive breach. Part of her argument is about whether or not these matters become public.

I respectfully submit that this is a separate issue of how and when and what types of penalties should be in the act. For substantive breaches, I think there should be something beyond limited monetary penalties. It should include a range of possible sanctions. Remember, we're talking about public office holders here, so it could include things ranging from apologies to dismissal. I think it's appropriate that the Prime Minister do that and not the Ethics Commissioner.

Having said all of that, I'll say that if you do want to go to a model whereby the commissioner becomes the enforcer and the commissioner becomes like a tribunal, you will have to enhance the procedural protections in the act for people who will be subject to her penalties.

That's a whirlwind view. I'll stop it there.

Thanks.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you both very much for your presentations.

We will now have our question and answer period.

Mr. Angus, you have seven minutes.

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

Thank you, gentlemen. This has been a very interesting opening session for us on the question of conflict of interest.

I think what we're all trying to get a sense of here is, how do we ensure that the rules are fair? Because in the day-to-day work of an MP, they could cross the line; it might not mean that they're setting out to do so, but they should be able to have a conversation. They should feel comfortable enough to be able to find out what the breach is and step back across that line. If Mr. Ford had taken advice of the commissioner the very first day that he stepped over the line, I think he wouldn't haven't been in the trouble that he was in. The commissioner was not out to bring him down but to say, “Listen, you might not fully understand the rules.”

I understand the education element of it. I guess the question is what the commissioner is asking for in terms of the greater breach. It's the issue of trying to influence someone in how to vote and make decisions. That has to have consequences.

Mr. Greene, do you believe the commissioner should have greater power for administrative monetary penalties? Who do you see taking that up?

[Prof. Ian Greene]

I haven't thought about that aspect nearly as much as Greg Levine has. It really is important for the commissioner to have enforcement powers, but as Mr. Levine pointed out, there need to be appeal mechanisms and safeguards.

Also, I really agree with Greg Levine: with regard to cabinet, it really should be up to the Prime Minister to enforce.

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

Mr. Levine, in terms of that comment you made, that it's up to the Prime Minister, isn't there going to be a political cost in that the Prime Minister's going to protect his own? Shouldn't this be hands off so that there's transparency? If someone's broken the rules in a clear way and the commissioner's decided, shouldn't the commissioner be able to say that and make that decision as opposed to punting it to a political stage?

[Gregory J. Levine]

There are two thoughts on that. You've expressed one, that it's too political, that it's best to get it out of the political realm. I understand that view. I think the other argument, though, and it's what I would I say about the code for the members of the House, is that it's about taking responsibility, too. You encourage people to take responsibility.

If you see the Conflict of Interest Act as an educative tool, and you believe members and the Prime Minister and the cabinet ministers and all public office holders should take responsibility, then it's up to us to encourage a de-political approach to this.

I realize there's a certain level of idealism in that, but it seems to me you go one way or the other. If you're contemplating creating an ethics commission as opposed to having an ethics ombudsman who investigates and reports, you have to create a very different structure here. All I can say quickly is that you'll need to look at the models that exist in the United States, where you have essentially ethics tribunals. You will create a very, very different system that may not have the same value from an educational point of view, that may become cumbersome from an expense point of view, and so on. There's a lot to look at there if you go that route.

The other thing—

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

I guess the question here—

[Gregory J. Levine]

Can I just say—

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

I only have a few minutes here, and I just want to be really clear on this.

[Gregory J. Levine]

I'm sorry.