Information & Ethics Committee on Aug. 10th, 2020

[Jacques Gourde, Conservative, Lévis—Lotbinière, QC]

Thank you, Madam Chair.

My question is for both witnesses, so they can each answer, beginning with Mr. MacDonald.

There's one thing in this whole affair that bothers me. When you run for office, you're telling Canadians that you're the best choice for them. Canadians are the ones who decide, but elected officials have a responsibility. That responsibility is even clearer at a ministerial level, because the decisions flow from the Prime Minister and ministers.

The Minister of Finance and the Prime Minister knew they had a conflict of interest. They admitted that they should have recused themselves. They admitted to their mistake. The finance minister even repaid more than $40,000 because the media got wind of the story and he felt obliged to do so. He has some responsibility.

What bothers me the most is that the Prime Minister pinned the blame on public servants. He said public servants advised him to make the decision he did. The Prime Minister seems to be forgetting that he is the one who should have made the decision. It was his responsibility. He is the one Canadians elected to make the tough decisions.

This wasn't a tough decision, in my view. I'll give you an example of a tough decision. When we sent the military into Afghanistan, we knew there would be fatalities. We voted to do so in the House, knowing that Canadians would die because of our decision. That's a tough decision. Refusing to recuse yourself when you know that your family is in a conflict of interest and that you, personally, may have a conflict of interest is not a tough decision. It's a judgment call.

Mr. MacDonald, did the Prime Minister deny his responsibility in the face of this easy decision?

[Dr. Chris MacDonald]

Without being able to quote the Prime Minister directly, every individual under the act clearly has responsibilities to recuse himself when the decision at hand meets the relevant criteria. It complicates things a little that the act differentiates between family members and relatives, and family members are limited to the nuclear family, so I'm not sure how the commissioner, for example, would interpret this.

You're right to the extent there's no escaping having to make the decision to recuse oneself. That part goes with the role and the terms of the act.

[Jacques Gourde, Conservative, Lévis—Lotbinière, QC]

Could the other witness please answer?

[Robert Czerny]

Mr. Gourde, I have to apologize. I came prepared to give members an overview of managers' working conditions when they are called upon to participate in the decision-making process. I'm not prepared to discuss the details of this case. In order to comment, I would need to know all the details, and the information would have to be reliable. I'm not in that position. I admire and appreciate your reaction to this situation.

[Jacques Gourde, Conservative, Lévis—Lotbinière, QC]

Let's get back to my question.

Generally speaking, senior officials provide advice to ministers and the Prime Minister, and to us, if we ask for it.

With the tools and information they have, they do their best to explain the options available to us. This was a political decision, however. The decision was up to cabinet, including the finance minister, Mr. Morneau, and the Prime Minister. They didn't recuse themselves. When the Prime Minister and the Minister of Finance are in favour of doing something, it's pretty hard for the other ministers to object.

Was there really a conflict of interest or, worse, an abuse of power?

[Robert Czerny]

Unfortunately, I have to say again that I'm not in a position to comment. I will say, though, that I would be very surprised to see a deputy minister say to a minister, “you're in a conflict of interest, but I advise you to go ahead anyways.” That wouldn't happen.

[Jacques Gourde, Conservative, Lévis—Lotbinière, QC]

It's not the deputy minister's job to tell the minister that they have a conflict of interest. The minister should realize it themselves. If they can't see it on their own, then, they don't deserve to be minister. It's as simple as that. Ethics and conflicts of interest go to the heart of politics. Canadians put their trust in politicians. If that bond of trust is broken, our democratic system falls apart.

Do you agree?

[Robert Czerny]

I think it's a good question, and I'd say you answered your own question.

[The Chair, Conservative, Rachael Thomas]

Thank you very much.

We're turning it over, then, to Mr. Dong, who is sharing his five minutes with Ms. Zahid.

[Han Dong, Liberal, Don Valley North, ON]

Thank you, Chair.

My first question is for Mr. MacDonald. It was a very interesting presentation, by the way. I took the point, and it's a very important one, that a situation of conflict of interest, or even a perceived one, will shake the public's confidence in the system.

We heard our previous presenter calling for more detailed and stricter rules around conflict of interest. Do you agree that we need more rules, or perhaps stricter penalties on conflict of interest, Mr. MacDonald?

[Dr. Chris MacDonald]

I think the rules can always be made clearer. I'm not sure more rules are better. I think, in many kinds of situations in the private and public sectors, we find not so much that there weren't enough rules, but that people either didn't know how to apply the rules, or the culture of a particular organization encouraged not following the rules. It's not so much that you need more rules.

That being said, I've already signalled that I think the Conflict of Interest Act deserves some attention and some tuning up. That might involve more rules, but it looks to me like there's nothing in the current case that couldn't be dealt with under the rules as they are.

[Han Dong, Liberal, Don Valley North, ON]

Perhaps the more experiential training you mentioned might help.

Mr. Czerny, in your view, what's the difference between a perceived and an actual conflict of interest? Should that be legislated in the code? How is that going to affect a government's decision-making?

[Robert Czerny]

I'm aware that there are instances of codes at other levels of government in Canada that do set out a prohibition against the appearance of conflict of interest. In other words, they do not only cover the fact that a decision was taken that can be shown to have been in conflict of interest, but they also say that the appearance of conflict of interest is something that a public official is obliged to avoid—

[Han Dong, Liberal, Don Valley North, ON]

Should a perceived conflict of interest and an actual conflict of interest be treated the same way?

[Robert Czerny]

I would guess that the consequences of that would be that the failure to reveal and to manage properly a conflict of interest would.... Yes, that has to be sanctioned or managed in some fashion. It's not only the actual that needs to be addressed by the legislation.

[Han Dong, Liberal, Don Valley North, ON]

Thank you.

I'll hand it over to my colleague from Scarborough Centre.

[Salma Zahid, Liberal, Scarborough Centre, ON]

Thank you to both of the witnesses.

My first question is for Mr. Czerny.

Given your experience in organizational ethics, what are the key elements of creating an ethical culture and developing ethical judgments? What would you say, based on your experience?

[Robert Czerny]

As I said in my opening remarks, there's been a very solid evolution and development of these sorts of elements that contribute to that. I don't think I can name any, other than those I named before.

There have to be explicit expectations. Those expectations have to be announced and reinforced throughout the organization by communications, by training and by constant dialogue. We all have to be aware that the world keeps changing, situations keep changing and people keep changing. Ethics isn't something like mathematics, in which once you know your times table, you don't have to keep relearning it every few years. This is something quite different from that.

Beyond that are all the situations of providing for procedures and offices and so forth, internal to either an organization or a neutral third party, that allow people to seek advice or to raise concerns that they feel it would be too awkward to raise directly with their colleagues or superiors.

All of that is important, but I think the main point is the consistency of the culture, such that those at the top are the ones who are most visible and who end up leading and cascading the ethical culture through the organization. That would be my number one.

[The Chair, Conservative, Rachael Thomas]

Thank you so much, Mr. Czerny.

Mr. Kurek, you have the floor for five minutes.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Thank you very much, Madam Chair.

I appreciate both of our witnesses appearing before us this afternoon.

I appreciate that Mr. MacDonald mentioned “trust” and that Mr. Czerny alluded to that as well. It's absolutely fundamental in the functioning of a society. Citizens need to have trust in their institutions and in the public office holders, because that affects every aspect of the information and the decisions they make. It's not just about a conflict of interest; it's the reputation of an institution that is incredibly important.

Mr. Czerny, with your experience in the public service, I'd be very curious to hear your input. The excuse the Prime Minister has given is that the public service made this non-partisan recommendation, and they simply had no choice but to follow it. In my experience, that's certainly not how briefing notes are written. That's not how proposals are brought forward. I'd be very curious about whether you have any comments on the Prime Minister's defence that this was something that was totally hands off, that it was handed to him and that was that.

[Robert Czerny]

I'm afraid I really can't comment. I wasn't inside in any of these processes. You're giving your well-educated reading of the situation. You're reading the signals, and everybody else can too, but I can't add to that.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Sure. I appreciate that, and I appreciate the honesty.

This question is for Mr. MacDonald. The Prime Minister has implied that he did not need to speak with the Ethics Commissioner because his wife was cleared by the Ethics Commissioner with regard to her work with WE prior to the fact. Do you think he still should have spoken to the Ethics Commissioner about WE and the Canada student service grant when he first became aware of it?

[Dr. Chris MacDonald]

Certainly had I been lucky enough to have my opinion asked for several months earlier than this, l probably would have told the Prime Minister that, yes, this is the kind of situation you want to keep more than an arm’s length from and in which you want to go to some lengths to do your best to make sure this is handled very cleanly.

This is a good example of the difference in the Conflict of Interest Act. It differentiates between siblings, on the one hand, and family, on the other. Those are relatives. You're going to want to say, “Well, look, you might be able to say that a sibling's participation in WE Charity puts me outside of the requirements of the act, but because of the importance of the situation, I want to go a little above and beyond.” And certainly that's what I would have recommended to the Prime Minister, even if it wasn't risking clear violation of the act.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

I appreciate that.

Mr. MacDonald, at the finance committee the Clerk of the Privy Council implied that there are some decisions that are simply too big for the Prime Minister or the finance minister, for example, to be recused on. I would be curious to know your view on that, and then I will ask the same question of Mr. Czerny.

[Dr. Chris MacDonald]

I guess in the abstract that seems plausible to me. There may be questions that prime ministers and senior cabinet ministers get involved in, questions of the highest order, such as acts of war and things like that. It may well be that in the abstract, some of those are absolutely essential, even if there's a conflict of interest. Then you'd start to look for mitigating strategies. Certainly, though, I would think the list would be relatively short.