Mr. Speaker, I will be splitting my time with the member for Windsor West.
Today we are debating an NDP motion calling on the Minister of Finance to apologize to the House and to Canadians for breaking their trust and calling on the government to close the loopholes he exploited in the Conflict of Interest Act, in order to prevent a minister of the crown from personally benefiting from their position or creating the perception thereof.
There are some people in this life who are clearly lacking in subtlety, and the Minister of Finance is unquestionably one of them. Fortunately, this gave us the chance to note that the minister had placed himself a situation that, at the very least, presented the appearance of a conflict of interest, that he had abused the trust of the House and the Canadian people, and that he had used a loophole in the Conflict of Interest Act for his own personal gain.
The Conflict of Interest Act clearly states that:
...a public office holder is in a conflict of interest when he or she exercises an official power, duty or function that provides an opportunity to further his or her private interests...
In the weeks following his election in 2015 and his appointment as finance minister, the minister suggested that he had complied with the Conflict of Interest Act, which, generally speaking, requires members to divest themselves of their shares or to place them in a blind trust if their duties could place them conflict of interest. However, we recently learned that this is not what the minister actually did. Instead, as we finally found out, the minister took advantage of a loophole in the Conflict of Interest Act to place his half of his shares in Morneau Shepell in numbered companies. In other words, the finance minister no longer holds shares in Morneau Shepell; the numbered company does. However, since he is the sole shareholder in the numbered company, this is just a matter of semantics.
The minister betrayed the trust of Canadians and the House by leading them to believe that he had followed the spirit of the Conflict of Interest Act when really he had made use of a loophole. The spirit of the act serves to ensure that those serving in the role of minister do not find themselves in a real or perceived conflict of interest. If he had truly been abiding by the spirit of the act, the minister would have placed his shares in Morneau Shepell in a blind trust or simply divested himself of all of his shares.
Instead, what he did was use a loophole to circumvent the spirit of the act and put himself in a position where he could personally benefit from the policies he implemented as the Minister of Finance. He did that for two years.
None of this passes the sniff test, especially since we are not talking about pocket change here. The shares in Morneau Shepell that the Minister of Finance directly or indirectly owns are valued at over $20 million as of October 20, 2017. It seems to me that any reasonable person standing to become finance minister that owns more than $20 million in shares in a company that bears his name would have seen a huge red flag with the word “danger” flashing in neon lights, and perhaps asked himself whether he should put all those assets in a blind trust so as to avoid the appearance of conflict of interest. That all seems like common sense to me.
There is more, however. On October 19, 2016, on the first anniversary of his election by the way, the Minister of Finance introduced and sponsored Bill C-27, an act to amend the Pension Benefits Standards Act, 1985, which would increase the use of target benefit pension plans. The Minister of Finance's former company, Morneau Shepell, is a strong proponent of target benefit plans and manages related services. Those plans are that corporation's bread and butter. Should Bill C-27 pass and come into force, the company stands to be one of only four corporations in Canada that would benefit from the new pension administration rules.
While the current finance minister was in charge of Morneau Shepell prior to being elected, the company lobbied for greater use of targeted benefit retirement plans and became the Government of New Brunswick's lead consultant in implementing its new pension plan.
The Minister of Finance's company would absolutely cash in by helping existing clients switch to targeted benefit plans and producing the annual actuarial valuations that would be mandatory under the new law. The current system requires them only every three years. That would generate even more business for his company. Clearly, as a major shareholder in his company, the minister would derive personal financial gain if this bill were to become law.
The worst of it is that the Minister of Finance is the one sponsoring this bill. Ordinarily, because he still holds shares in a corporation that would directly benefit from the legislation, he should have declared his interest and recused himself from any cabinet discussion of the bill. Instead, he celebrated his first year in office with the gift of bill sponsorship. That is a pathetic way for a Canadian finance minister to behave.
To top it off, within days of the Minister of Finance introducing Bill C-27, Morneau Shepell shares were up almost 5%. We can all agree that that is no coincidence.
I repeat:
...a public office holder is in a conflict of interest when he or she exercises an official power, duty or function that provides an opportunity to further his or her private interests...
We are no longer talking about appearances here. The Minister of Finance is in a direct conflict of interest, but he waited for it to be discovered and for the media to report on it before fixing the problem. On top of that, when he was elected in 2015, the value of the minister's shares in Morneau Shepell was $32.1 million. As of last Friday, as I mentioned earlier, his shares were worth $42.6 million, which means that his shares generated a profit of over $10 million in the past two years. If he still owns half of what he had in 2015, that means an extra $5 million in his pocket, while he is the Minister of Finance.
When the information was made public last week about his shares in the company bearing his name, it took us asking him nearly 20 times before he would finally confirm that he still has considerable holdings in Morneau Shepell, as though he had something to hide. This Minister of Finance is like a kid who was caught with his hand in the cookie jar, with chocolate around his mouth, but who still denies doing anything wrong. This reminds of the time when one of my brothers was caught licking another brother's ice cream cone, and he said that his tongue simply fell on it.
This is not a matter of cookies or ice cream. We are talking about millions of dollars. When the minister finally held a press conference to announce that he would divest himself of his shares, the price of his company's shares dropped by $0.41 in the three following hours, costing the minister an estimated $410,000. It is easy to see why he hesitated to respond and do what was necessary to put an end to this situation, which was strongly perceived as a conflict of interest. How can the minister continue to try to lead us and Canadians to believe that he went into politics for the right reasons and that he is really working in the interests of the middle class and those working hard to join it?
How many middle-class Canadians earn $5 million in two years? We now see why the finance minister was reluctant to tax the wealthiest Canadians. I grew up in a family where my parents had to work hard to make sure that their children had everything they needed in life, and I want to thank them for that here. Thank you, Mom and Dad. I decided to go into politics to help families have the same opportunities that my parents gave me. We are not here to help the rich get even richer.
At the very least, the minister should apologize to Canadians and members of the House for betraying their trust and leading them to believe that he was carrying out his duties in the interest of the public, rather than in his own personal interest. Ministers have lost their limos for far less than this. The government must also immediately commit to eliminating the loophole in the Conflict of Interest Act to ensure that the sorts of antics we are seeing today never happen again and that the spirit of the Conflict of Interest Act can no longer be circumvented by semantics.