|
|
|
PRB 05-59E
Prepared by:
Kristen Douglas
Law and Government Division
Revised 11 October 2007
PDF (79 Kb, 12 pages)
The Federal Accountability Act, which received Royal Assent on 12 December 2006, included a new Conflict of Interest Act (CIA), which for the first time enshrined in legislation the Conflict of Interest and Post-Employment Code for Public Office Holders. The CIA also created new obligations for the Conflict of Interest and Ethics Commissioner (“the Commissioner”), whose office replaces that of the former Ethics Commissioner.
By an Order in Council, the CIA came into force on 9 July 2007, and Ms. Mary Dawson was appointed the first Conflict of Interest and Ethics Commissioner on the same date. The Commissioner is an Officer of Parliament appointed under section 81 of the Parliament of Canada Act (POCA).
The CIA, which in essence replaced the Conflict of Interest and Post-Employment Code for Public Office Holders (often referred to as the Prime Minister’s Code) with a statutory regime of ethical rules and obligations applying to public office holders and former public office holders, creates one part of the Commissioner’s role. The provisions of the CIA apply to Cabinet ministers, parliamentary secretaries and other senior public office holders such as political staff of ministers and most Governor in Council appointees.
In addition to his or her responsibilities under the CIA with respect to public office holders, the Commissioner is also responsible for the administration of the Conflict of Interest Code for Members of the House of Commons (“the Members’ Code”).
The Commissioner’s predecessor, Dr. Bernard Shapiro, had been appointed Ethics Commissioner in May 2004.(1)
During the 38th Parliament and the 1st session of the 39th Parliament, the Ethics Commissioner reported to two parliamentary committees. Under the Standing Orders of the House of Commons,(2) his duties with respect to the Members’ Code fell within the mandate of the House of Commons Standing Committee on Procedure and House Affairs. His duties with respect to the Conflict of Interest and Post Employment Code for Public Office Holders fell within the mandate of the House of Commons Standing Committee on Access to Information, Privacy and Ethics.
The Ethics Commissioner’s mandate under the Members’ Code, which came into effect with the first sitting of the 38th Parliament on 4 October 2004, included: the maintenance of the public registry of all members’ public disclosure summaries; the provision of written confidential opinions to members; and the conduct of inquiries into any member’s alleged non compliance with the Code’s obligations. The Commissioner reports on the inquiries conducted pursuant to the Members’ Code, and makes annual reports to the House of Commons on all activities in relation to its members.
The Commissioner’s mandate in respect of public office holders, as set out in the CIA, includes the following aspects:
The CIA permits any parliamentarian to request, in writing, that the Commissioner investigate if the parliamentarian reasonably believes that a minister of the Crown, a minister of state or a parliamentary secretary has contravened the Act. The Commissioner may also conduct such an examination on his or her own initiative. Reports on such investigations must be made public, although some of the information obtained from the investigations must be kept confidential. The Parliament of Canada Act also requires the Commissioner to report annually on his or her activities under the Members’ Code to the Speaker of the House of Commons, and to the speakers of both houses on his or her activities under the CIA.
Members of Parliament are bound by the Members’ Code, which is Appendix 1 to the Standing Orders of the House of Commons. The Code articulates several purposes, including that of maintaining and enhancing public confidence and trust in the integrity of members, and a number of principles that are intended to guide members in reconciling their private interests and public duties.
The Members’ Code prohibits members from voting or acting in a way that would further their own or others’ private interests, and requires that their private interests be disclosed whenever a decision that would affect those interests is under consideration. They and their families must report to the Commissioner any travel or gifts valued in excess of specified limits. Members, and any corporations owned by them, are prohibited from entering into federal government contracts.(4)
All members are required to file statements with the Commissioner disclosing the assets and liabilities belonging to themselves and their families. The Office of the Conflict of Interest and Ethics Commissioner then prepares a disclosure summary based on each member’s statement, and the summaries are available for public review on the Commissioner’s Web site.
Members of Parliament may request the Commissioner to offer a confidential opinion in respect of their obligations under the Code at any time. Also, any member who is of the opinion that another member has not fulfilled his or her obligations under the Code may request that the Commissioner conduct an inquiry into the matter. The Commissioner may also conduct an inquiry on his or her own initiative. In conducting such inquiries, the Commissioner must operate in private and with due dispatch, and at all appropriate stages throughout the inquiry, the Commissioner must give the member reasonable opportunity to be present and to make representations. In a report on an inquiry, the Commissioner may recommend sanctions, and must offer reasons for his conclusions and recommendations.
The Conflict of Interest Act requires that, once they are appointed, public office holders must arrange their private affairs so as to prevent conflicts of interest from arising. With limited exceptions, they must not: solicit or accept money or gifts; assist individuals in their dealings with government in such a way as to compromise their own professional status; take advantage of information obtained because of their positions as insiders; and, after they leave public office, they must not act so as to take improper advantage of having held that office. Since 1994, information relating to the spouses and dependent children of ministers, secretaries of state and parliamentary secretaries has also been considered relevant.
Public office holders include Cabinet ministers, parliamentary secretaries, ministerial advisers and certain Governor in Council appointees. Approximately 1,250 full-time public office holders, including not only the Prime Minister, ministers, ministers of state, parliamentary secretaries and ministers’ exempt staff, but also full-time Governor in Council appointees, including deputy and associate deputy ministers and heads of agencies, Crown corporations, boards, commissions and tribunals, and 2,200 part-time public office holders are bound by the Act.
Although the definition of public office holders remains the same under the CIA as what was prescribed in the Prime Minister’s Code, section 2 of the CIA adds a new term – “reporting public office holder.” The latter list of positions creates a subgroup of public office holders; this includes members of ministerial staffs who work on average 15 hours or more a week, part-time Governor in Council appointees who receive an annual salary and benefits, and full-time Governor in Council appointees, all of whom are reporting public office holders. As such, they are prohibited from engaging, by and large, in the activities listed in the Prime Minister’s Code (being employed, operating a business and so on); are subject to the rules regarding disclosure and the divestment of assets; and are also subject to all of the post-employment rules contained in the CIA.
The CIA provides that public office holders, in order to reduce the risk of conflict of interest, should, depending on the asset or interest in question, use avoidance, a confidential report, a public declaration, divestment, or recusal. Divestment can include making an asset subject to a trust or management agreement. In relation to outside activities, a public office holder is not to engage in the practice of a profession, actively manage or operate a business or commercial venture, retain or accept directorships or offices in a financial or commercial corporation, hold office in a union or professional association, or serve as a paid consultant. The CIA also deals with public office holders after they leave office. Many of the post-employment rules are the same as in the Prime Minister’s Code. One of the most important differences brought about through the Federal Accountability Act was actually contained in the proposed Lobbying Act, rather than the CIA. There is a five-year ban on lobbying activities for designated public office holders (as defined under that Act(6)). The Commissioner of Lobbying may exempt individuals from the application of the provisions, applying any criteria deemed relevant, including: being a designated public office holder for only a short time; being employed on an acting or administrative basis only; or being employed as a student. The reasons for any exemptions must be made public.
Under the CIA, the Commissioner is to administer the Act and apply its conflict of interest compliance provisions to public office holders. Any information he or she receives is to be kept confidential until and unless a public declaration is made. Arrangements made by public office holders to reduce the risk of a conflict of interest must be approved, in the case of ministers of the Crown, ministers of state and parliamentary secretaries, by the Prime Minister, in consultation with the Ethics Commissioner. In the case of all other public office holders, including the Prime Minister, approval must be obtained from the Ethics Commissioner. Once arrangements are completed, summaries and public declarations are posted in the public registry. Section 43 sets out the requirement, previously found in section 72.07 of the POCA, that the Commissioner provide confidential advice to the Prime Minister, as well as to individual public office holders, on the application of the Act.
In a significant change from the previous regime, section 44 of the CIA permits parliamentarians to request, based on a belief on reasonable grounds that there has been a contravention of the CIA, that the Commissioner examine a possible contravention by any current or former public office holder. The Commissioner may consider information from the public that is brought to his or her attention by a member of Parliament suggesting that a public office holder has not complied.
Proposed section 45 permits the Commissioner, when he or she has reason to believe that a current or former public office holder has contravened the CIA, to examine a matter on his or her own initiative. The Commissioner must provide the affected public office holder with a reasonable opportunity to present his or her own views before reporting on an examination.
The Commissioner has powers to summon witnesses and compel them to give evidence or to produce documents similar to those that were available to the Ethics Commissioner under the previous regime.
During the 38th Parliament, Dr. Shapiro met many times with both the Standing Committee on Procedure and House Affairs and the Standing Committee on Access to Information, Privacy and Ethics. He completed and reported on three inquiries related to members of the House of Commons, and one in relation to a public office holder,(7) finding wrongdoing or inappropriate behaviour in three out of the four cases. In no case did the Commissioner recommend any particular sanction against the investigated individual, although in one case he noted that the public office holder in question had already resigned as minister.
In June 2005, the Commissioner issued annual reports with respect to both Codes for the fiscal year ending 31 March 2005. In October 2005, he presented another report entitled Issues and Challenges 2005, which, as its title indicates, addressed the issues and challenges faced by the Office in its first year of operation.(8) In these reports, Dr. Shapiro identified some organizational challenges that had made his first year in office difficult. The creation of a new parliamentary office, although it inherited some expertise and resources from the former Ethics Counsellor’s office in Industry Canada, posed significant organizational challenges. Very few of the public servants who had initially been seconded to the Ethics Commissioner’s office accepted permanent employment there, which led to a loss of expertise and production for several months. However, the report concluded that the Office was fully operational.
In its first year in operation, the Office of the Ethics Commissioner had discovered practical problems in the administration of the Codes, and the Commissioner proposed new policy approaches designed to improve its effectiveness. In other areas, he indicated that gaps or conflicts would need to be corrected by amendment of the Parliament of Canada Act or one of the Codes.
Concerns were raised about the mechanisms under the Prime Minister’s Code by which public office holders prevent real or perceived conflicts of interest, including the recusal process, compulsory divestment or more detailed disclosure. The Commissioner recommended that all instances of ministerial recusal should be made public. Also, he sought clarification that, under that Code, all public office holders could be examined by the Commissioner, as members can be under the Members’ Code.
The Issues and Challenges report suggested that the Parliament of Canada Act should be amended to include a provision clarifying the power of the Ethics Commissioner to examine all public office holders, either at the request of a parliamentarian or on the Commissioner’s own initiative. The Commissioner also recommended that the government introduce legislation providing for appropriate legal sanctions for breaches of the post employment provisions of the Prime Minister’s Code.
In the areas governed by the Members’ Code, the Commissioner made a number of procedural recommendations, and proposed that the requirement to report material changes in members’ assets, liabilities or outside activities within 30 days be removed from the Members’ Code.
All five major political parties addressed ethics-related issues in the 2006 election campaign. The Conservative Party of Canada made a series of recommendations in its proposed “Federal Accountability Act” to increase the powers and broaden the role of the Ethics Commissioner, including empowering the Commissioner to impose fines for violations.(9)
The Liberal Party of Canada, in its election platform,(10) referred to the creation in 2004 of the Office of the Ethics Commissioner, but offered no plans to alter its role.
Arguing that a lack of resources had prevented the Ethics Commissioner from imposing real controls on ministers during the 38th Parliament, the Bloc Québécois proposed in its 2006 platform that the budgets of officers of Parliament and the Ethics Commissioner should be determined by a parliamentary committee composed of one representative from each party represented in the House of Commons, supported by an expert panel and representation from the offices concerned.(11)
The New Democratic Party, although it made a number of proposals relating to ethics and accountability in its 2006 platform, made no specific plans to change the role or the office of the Ethics Commissioner.(12)
The Green Party of Canada recommended replacing the current Ethics Commissioner with an independent Ethics Commission, which would report to Parliament, be appointed through a merit-based process and have strong powers to investigate government officials and lobbyists. It also recommended mandatory ethics training for all members of Parliament and their staff.(13)
As noted above, the Federal Accountability Act (FAA), which came into force in December 2006, represented one of the government’s first priorities in the 1st session of the 39th Parliament. The new legislation enacted the Conflict of Interest Act, creating for the first time a legislative regime governing the ethical conduct of public office holders, both during and after employment. In addition to creating a series of compliance measures, the FAA also established a complaints regime, set out the powers of the new Commissioner, and provided for public reporting and penalties.
The Commissioner’s mandate, appointment and term are governed by amendments to the Parliament of Canada Act, which also prohibits members of the House of Commons from accepting income from certain trusts and requires them to disclose all trusts to the Commissioner. The FAA also made amendments to the Canada Elections Act dealing with political donations, contributions, gifts and prosecutions under that Act. It amended the Lobbyists Registration Act to provide for the appointment of a Commissioner of Lobbying upon approval by Parliament.(14) The amendments will extend the scope of that Commissioner’s investigative authority (compared with that of the existing Registrar of Lobbyists), make the office more independent of government, and give it new enforcement powers. Amendments to the Public Service Employment Act eliminate preferential hiring for ministers’ political staff.
Given the consistent interest of parliamentarians and parliamentary committees, as well as the public at large, it can be anticipated that the role of the Commissioner will generate considerable attention during the coming session of the 39th Parliament. During the 1st session of the 39th Parliament, only two meetings of the House of Commons Standing Committee on Access to Information, Privacy and Ethics were devoted to the Ethics Commissioner or the new Commissioner: in November 2006, Dr. Shapiro met with the Committee to discuss the Estimates for his office; and in June 2007, the nomination of Ms. Dawson as Commissioner was reviewed and approved. The House of Commons Standing Committee on Procedure and House Affairs issued two reports during that session one of which recommended amendments to the Members’ Code.(15) The work of the new Commissioner, and the application of the CIA and the Members’ Code by her office,(16) will likely be followed closely by parliamentarians.