Public Accounts Committee on Sept. 5th, 2024

[Donnalyn McClymont]

Mr. Chair, I would respond that the notice of opportunity very clearly states, as I said, the obligations under the Conflict of Interest Act. We have a link to the act and to the circulars that the commissioner provides. We also make very clear in our notices of opportunity the requisite skill set. When there are obligations under statute for criteria, we make those available as well.

I would say that from the outset, when someone would have applied to be a chair or a member on this board, they would have had that information very squarely in front of them when they put their candidacy forward.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Ms. Verschuren made a choice, is what you're saying. She made a choice. She had knowledge of the requirements of the act. You, in your capacity, ensured that potential appointees, including Ms. Verschuren, had full awareness and knowledge of the requirements of the act. You just stated that now. She went on, of course, to either ignorantly ignore those requirements or to act with the type of self-interest that resulted in the conflict.

Would that be a fair assessment?

[Donnalyn McClymont]

Mr. Chair, I would just refer back to the public record of the Ethics Commissioner, who noted that it was very unfortunate that on these particular occasions in question the legal advice did not align with the legislation and his interpretation. I wouldn't offer anything further than what the Ethics Commissioner himself said on this matter.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much.

Looking forward in terms of the transfer of this work to the National Research Council, what role will you or your office play in determining the selection of their new board, if they choose one, if there is one that is different from the current board of SDTC, which is volunteering for its transfer?

[Donnalyn McClymont]

Mr. Chair, there will be two separate and distinct elements in terms of the governance structure surrounding the new approach, if you will.

In the first instance, as you heard on Tuesday from my colleague Mitch Davies from the NRC, they will be administering the funding. The NRC has a board that has a chair and members. We will be responsible for supporting any appointments to that board. I think it has a pretty full board right now, with no foreseeable vacancies coming. There are two vacancies on that board right now, so it's possible that we may be making appointments to the NRC board.

I would also note, as I've explained previously to other members, that the Canada innovation corporation is to have a chair and directors. I expect that, when that organization is struck, we will be responsible, as we are in most instances, for running a selection process for the chair position and the director positions, and it will have all the standard elements that I've been describing here today.

[The Chair, Conservative, John Williamson]

Thank you very much. That is the time.

You'll have one other opportunity, Mr. Desjarlais, for further questions.

Turning now to Mr. Cooper, you have the floor for five minutes, please.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Thank you, Mr. Chair.

Madam McClymont, did I hear you say in answer to a question by MP Bradford that you would characterize the appointment process of the chair and board of SDTC as a success?

[Donnalyn McClymont]

Mr. Chair, what I was mentioning was the fact that there was a consultation done in advance of the appointment to emphasize, as it was pointed out in the Ethics Commissioner's report.... I guess what I would say on that is, to me, it is a best practice. If somebody has a potential conflict, they meet with the Ethics Commissioner in advance—

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Madam McClymont, it was conflict upon conflict upon conflict, because it wasn't just Ms. Verschuren who had a conflict. One Stephen Kukucha, a Liberal insider and Trudeau organizer, received $20 million in funding from SDTC, yet he was appointed to the board. Guy Ouimet, months before his appointment, received millions of dollars in funding from SDTC.

There seems to be a pattern here, and that pattern, under this government's watch, is that in order to be appointed to the SDTC one must have a conflict of interest. How else are these people being appointed, with the disastrous result of $330 million in taxpayer dollars improperly going out the door and being funnelled into the companies of these very same insiders who had conflicts of interest right out of the gate yet got through the process?

It's hardly a success.

[Donnalyn McClymont]

I'm not quite sure what the question is, Mr. Chair.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

I would simply say that, if you aren't prepared to call that a failure, I don't know what could be a failure, because it's a top-to-bottom failure. It's a systematic failure, but ultimately, it was the minister who made the decision.

Going back to the letter of recommendation from the PCO, once that letter with recommended candidates, for the chair of SDTC in this case—and you're going to come back with the number on that letter—is sent, it is up to the minister and the minister's team to then vet those recommended candidates.

Is that correct?

[Donnalyn McClymont]

Mr. Chair, yes, that is correct. We provide advice to the minister, and it is for the minister to assess the candidates based on our advice and make a recommendation to the Governor in Council, which would then be approved by cabinet.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

That's right. The PCO is not involved. Once the letter is sent, it's the minister who vets. Then the minister ultimately makes a recommendation to the cabinet, and that individual is appointed.

[Donnalyn McClymont]

Mr. Chair, yes, that is correct. The minister would make a recommendation. For further clarity, he or she would send in a ministerial recommendation to the Governor in Council. Once we do a security and background check clearance, the individual in question would be brought forward for cabinet consideration.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Okay. Well, thank you very much for that, because you have now put on the record something that Minister Bains repeatedly refused to acknowledge when he appeared before the industry committee back in June—that is, that the buck stopped with him. The ultimate decision laid with him to appoint Annette Verschuren. It wasn't some process with the PCO being responsible. It was the minister—correct?

[Donnalyn McClymont]

Mr. Chair, just to clarify, I would say that we would have provided advice to the minister. The minister, based on the advice provided by the Privy Council Office following a selection process, would have made a recommendation to the Governor in Council.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Would the PCO undertake due diligence reviews of each of the candidates with the view of identifying conflicts of interest?

[Donnalyn McClymont]

Mr. Chair, as I mentioned, as part of the selection process, we absolutely, in the notice of opportunity right up through all phases of the selection process and appointment process, do ask individuals at many opportunities if they have any conflicts. If things are identified to us, we recommend that they speak to the commissioner.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

Yes, and we know the end result.

Through you, Mr. Chair, the minister just ignored issues of conflicts of interest. How else would Ms. Verschuren be appointed? How else would Stephen Kukucha be appointed? How else would Mr. Ouimet be appointed? The minister simply didn't care. It came down to handing out appointments to Liberal insiders, conflicts be damned.

Thank you, Mr. Chair.

[The Chair, Conservative, John Williamson]

Thank you.

The floor is yours, Ms. McClymont, if you have a response. I did not hear a question there, but I will allow a response.

[Donnalyn McClymont]

Thank you very much, Mr. Chair. I appreciate that.

I would say, as I've said several times now, that inherent to having a piece of legislation that provides for both MPs and Governor in Council appointees to declare conflicts of interest, it is understood, I think, that there will be cases where that will happen. The issue is the importance of having a robust system in place to manage those conflicts.

[The Chair, Conservative, John Williamson]

Thank you.

[Michael Cooper, Conservative, St. Albert—Edmonton, AB]

The system clearly was not robust.

[The Chair, Conservative, John Williamson]

Mr. Cooper, that is your time, I'm afraid.

Ms. Yip, you have the floor for five minutes, please.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Thank you.

It isn't the role of the PCO but the Ethics Commissioner's office to provide appointees with clarity on the rules under the act. Do you believe the Ethics Commissioner could also strengthen their processes to ensure that issues like this do not arise in the future?