Information & Ethics Committee on Nov. 8th, 2023

[Douglas McConnachie]

Thank you for the question, Mr. Chair.

The [Inaudible—Editor] obligations of the department require us to protect third party information, whether it be from the complainants, from those whom the allegations are against, or from the ultimate recipients—who, frankly, have not done anything wrong, in this case.

We consulted SDTC on the final draft of the report to ensure they were in agreement with the proposed redactions. That is what, I believe, the committee has received, although I'm not aware of the more recent versions you referred to.

[René Villemure, Bloc, Trois-Rivières, QC]

For your information, the third version gives us a better understanding of the situation, while preserving the confidentiality of the information and the privacy of third parties. I was just wondering why we didn't get that last version right away. We've wasted valuable time. Honestly, I can understand that there are different levels of redactions, but initially it was impossible to follow anything.

[Douglas McConnachie]

Mr. Chair, I wasn't involved in the submission of these most recent versions. I believe our parliamentary affairs team coordinated that.

I'm sorry. I can't answer the question.

[René Villemure, Bloc, Trois-Rivières, QC]

Okay, that's fine. Please take note of that, though, because it might be helpful.

Ms. Urie, I would now like to turn to you.

You've just provided a very detailed version of your conflict of interest policy. Do you think that exists, an interest that isn't a conflict of interest?

[Sheryl Urie]

I can explain some of the different types of identified conflicts of interest that may not actually be conflicts of interest.

For instance, we may have a board member who is, perhaps, president of a company. They have a vendor that provides regular sewer maintenance services for their organization as a regular course of business. That vendor may also be identified as a project partner for one of our proponents developing an innovative technology for sewer management systems.

This may be identified as a potential conflict, but there's no monetary aspect the partner participating in the project is necessarily receiving for being part of another company in their regular course of business.

[René Villemure, Bloc, Trois-Rivières, QC]

If I understand correctly, the interests exist, don't they? Some interests may be in conflict, and some of those interests in conflict are not necessarily damaging. The distinction is important, because people often immediately associate “interest” with “conflict of interest”, and that causes some discomfort.

When you look at a conflict of interest, do you assess the accountability of the person who is in a conflict of interest?

[Sheryl Urie]

It's very important to understand the position the individual holds within the entity, who may have the perceived conflict of interest, because the ability of anyone to influence actions or decision-making for sure would have an impact on whether there would be a conflict of interest.

I would say that some of the discussions related to conflict of interest are discussed more deeply at the board to ensure that everyone is in agreement on whether it is a potential conflict or a perceived conflict.

We've taken actions more recently to engage an ethics adviser to ensure that the board has the support they need for those types of discussions as they move forward.

[René Villemure, Bloc, Trois-Rivières, QC]

Is the ethics advisor necessarily a lawyer?

[Sheryl Urie]

Yes, the ethics adviser is a lawyer.

[René Villemure, Bloc, Trois-Rivières, QC]

Okay.

Mr. McConnachie, the other day, I asked the minister a question, and he replied that it was more your area of expertise. This isn't directly related to Sustainable Development Technology Canada, but it seems to me that the government has a habit of contracting out its administrative obligations. We've seen cases similar to those in the media these days, such as the WE Charity case or the ArriveCAN case. The department signs an agreement with some non-profit organization, which allows the department to outsource its responsibilities and to be protected, in a way, from the standards of transparency and accountability that a department should normally meet, according to all expectations.

Who makes the decision to create a non-profit organization or to do business with such an organization?

[Douglas McConnachie]

My understanding in the case of SDTC is that the organization was created by statute in 2001. It was a decision of Parliament to—

[René Villemure, Bloc, Trois-Rivières, QC]

Okay, that's not the best example. However, within the department, you have other projects that are carried out by partners that are not subject to legislation as in the case of this agency. Who generally makes that decision?

I'm wondering why departments are not fulfilling their administrative obligations, as we saw with WE Charity. I don't want to go back to that specifically, but that's the dynamic I'm talking about. Why does that dynamic exist?

[Douglas McConnachie]

As a general rule, which is not pertinent to this case at all, third parties are often used because they have greater proximity to the target market or whomever the recipients are in the end. They may have specialized knowledge and expertise that doesn't exist in government, and they may also have relationships within those ecosystems that we don't have.

Frankly, there are a number of situations where grants and contribution programs are better delivered by someone who is closer to the—

[René Villemure, Bloc, Trois-Rivières, QC]

It still prevents transparency and ministerial accountability.

[Douglas McConnachie]

Generally speaking, these contribution agreements have numerous reporting provisions in them, and governance provisions as well, that allow for public servants to be observers on the board and allow for annual reporting requirements and other methodologies for managing the contribution agreements.

[René Villemure, Bloc, Trois-Rivières, QC]

Thank you very much.

[The Chair, Conservative, John Brassard]

Thank you, Mr. McConnachie.

Thank you, Mr. Villemure.

Mr. Green, you have six minutes. Go ahead, please.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you very much.

It's good to be back at committee. It's been quite some time. I'm a little out of practice.

I'm going to put a series of questions to you all in a very direct way. Please know that it's not personal. Please know that, if I ask to reclaim my time to move on to the next question, I'm not doing that to be rude, but our time is limited.

We've had some preliminary testimony here today about the natures of conflict of interest. I think that's at the heart of some of the allegations that have been made. I'd rather not talk about them hypothetically; I'd rather talk about them directly. I'll put my questions through you, Madam Chair.

As the chair of the board, how would you define conflict of interest?

[Annette Verschuren]

Conflict of interest is a situation where there is an interest, an influence, in terms of a direct conflict.

[Matthew Green, NDP, Hamilton Centre, ON]

That would include fiduciary benefits or other types of benefits to decisions that are made. Is that correct?

[Annette Verschuren]

That's correct, yes.

[Matthew Green, NDP, Hamilton Centre, ON]

I'm going to put these questions directly to you rather than hypothetically.

Are you currently the CEO of NRStor?

[Annette Verschuren]

Yes. I am chair and CEO of NRStor.

[Matthew Green, NDP, Hamilton Centre, ON]

Is NRStor currently on the conflict of interest registry?

[Annette Verschuren]

Yes, it is.