INST Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Industry, Science and Technology

EVIDENCE

CONTENTS

Thursday, November 21, 2002

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1540

The Chair (Mr. Walt Lastewka (St. Catharines, Lib.))

Mr. John Chenier (Editor and Publisher, ARC Publications)

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1545

¹

1550

The Chair

Mr. Brian Grainger (Grainger and Associates)

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1555

The Chair

Mr. Duff Conacher (Coordinator, Government Ethics Coalition)

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1600

º

1605

The Chair

Mr. Duff Conacher

The Chair

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1610

Mr. Duff Conacher

The Chair

Mr. James Rajotte (Edmonton Southwest, Canadian Alliance)

Mr. John Chenier

Mr. Duff Conacher

Mr. James Rajotte

Mr. John Chenier

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1615

Mr. James Rajotte

Mr. John Chenier

Mr. Duff Conacher

The Chair

Mr. Brian Grainger

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1620

The Chair

Mr. Dan McTeague (Pickering—Ajax—Uxbridge, Lib.)

Mr. Larry Bagnell (Yukon, Lib.)

Mr. Duff Conacher

The Chair

Mr. John Chenier

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1625

Mr. Brian Grainger

Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ)

Mr. John Chenier

Mr. Paul Crête

Mr. John Chenier

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1630

Mr. Paul Crête

Mr. Duff Conacher

Mr. Paul Crête

Mr. Duff Conacher

The Chair

Mr. Brian Grainger

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1635

The Chair

Mr. John Chenier

The Chair

Mr. Dan McTeague

Mr. John Chenier

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1640

Mr. Duff Conacher

Mr. Dan McTeague

Mr. Brian Grainger

Mr. Dan McTeague

Mr. Duff Conacher

Mr. Dan McTeague

Mr. Duff Conacher

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1645

Mr. Dan McTeague

Mr. Duff Conacher

Mr. Dan McTeague

Mr. Duff Conacher

Mr. Dan McTeague

Mr. Duff Conacher

Mr. John Chenier

Mr. Dan McTeague

Mr. John Chenier

The Chair

Mr. Dan McTeague

The Chair

Mr. Brian Grainger

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1650

The Chair

Mr. Brian Masse (Windsor West, NDP)

Mr. Duff Conacher

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1655

Mr. Brian Grainger

Mr. John Chenier

»

1700

Mr. Brian Masse

Mr. Duff Conacher

The Chair

Mr. John Chenier

»

1705

The Chair

Mr. Brian Grainger

The Chair

Mr. Brian Fitzpatrick (Prince Albert, Canadian Alliance)

»

1710

Mr. Duff Conacher

The Chair

Mr. John Chenier

Mr. Brian Fitzpatrick

Mr. John Chenier

Mr. Brian Fitzpatrick

Mr. John Chenier

The Chair

Mr. Duff Conacher

The Chair

Mr. Brian Fitzpatrick

The Chair

Mr. Brian Grainger

»

1715

The Chair

Mr. Duff Conacher

Mr. Brian Fitzpatrick

Mr. Duff Conacher

Mr. Brian Fitzpatrick

Mr. Duff Conacher

The Chair

Mr. John Chenier

»

1720

The Chair

Mr. Brian Fitzpatrick

Mr. John Chenier

The Chair

Mr. John Chenier

The Chair

Mr. Duff Conacher

The Chair

Mr. Brian Grainger

The Chair

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CANADA

Standing Committee on Industry, Science and Technology

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NUMBER 003

l

2nd SESSION

l

37th PARLIAMENT

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EVIDENCE

Thursday, November 21, 2002

[Recorded by Electronic Apparatus]

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[English]

    The Chair (Mr. Walt Lastewka (St. Catharines, Lib.)): I call this meeting to order on Thursday, November 21. The order of the day is Bill C-15, an act to amend the Lobbyists Registration Act.

    We have three witnesses with us today, and I thank them for their patience while the members gathered.

    We'll start the meeting with ARC Publications, Mr. John Chenier, editor and publisher.

    Mr. Chenier.

    Mr. John Chenier (Editor and Publisher, ARC Publications): Thank you, Mr. Chairman and members of Parliament. I appreciate the chance to contribute once again to your deliberations on this issue. This marks the fifth time that I have appeared on this matter over the years.

    With respect to the most recent legislation, Bill C-15, there are a couple of issues I would like to highlight for your consideration.

    The first is that this act, like the ones before, continues to leave out too much activity, making reporting and disclosure almost voluntary in some instances. To appreciate how this comes to be, you have to understand how lobbying campaigns are designed and implemented and how the consultants in Ottawa prefer to operate.

    Most consultant-lobbyists will tell you they don't lobby. By that they mean they do not often make direct representations on behalf of their clients, and that is correct. Consultant lobbyists in Ottawa spend most of their day gathering information on behalf of their clients. They talk to officials, both junior and senior, ministers' staff and ministers, and, depending on the campaign and the circumstances, members of Parliament.

    The information they obtain covers the status of their client's issues: possible timetables and potential snags for moving the issue toward a successful conclusion, the path the issue might take and the competition it faces, who's for and who's against, and why.

    The information gathered in this fashion is analysed in the context of the ongoing advocacy strategy. From this comes decisions about what might be done, which persons need to be and can be convinced of the merits, what information would help the campaign, how it would best be presented and where. The client is briefed. Action plans are drawn up wherein the client will be expected to be the main actor with the ongoing advice and coaching of the consultant-lobbyist.

    It can be seen, therefore, that lobbyists earn their money from their ability to access the necessary information, along with their knowledge and skills to assess its relevance for the client. While they may not make the oral representations, they are the heart of any advocacy campaign. Indeed, there likely would be no effective campaign without them.

    However, since what we define as lobbying is then left to the client, under the conditions of the old act, where it was defined as communications with an attempt to influence, and under the new act, which exempts, under proposed paragraph 4(2)(c), communication that is restricted to a request for information, disclosure of most activities of consultant-lobbyists is and will remain entirely voluntary, often with an eye to future marketing possibilities only. What this amounts to is that disclosure is on the consultant-lobbyists' terms. They, not the act, determine which of their clients and campaigns shall be made visible.

    I mention in passing that had the government followed through with the promise on page 95 of the 1993 red book to implement the unanimous recommendations of the House committee, entitled A Blueprint for Transparency, this would no longer be an issue.

    Does this matter? Or more particularly, how might this matter?

    Many lobbyists align themselves with various ministers and ministries. Lobbyists, by and large, have become an integral part of the party political process, as well as the policy process. I don't have a problem with that. Many lobbyists I know are political junkies. Lobbying is something they do to put bread on the table and fill in the time between campaigns. Many of these lobbyists have told me they do not lobby in departments or on issues where their ministerial ties are strongest, but this does not mean they do not have clients with interests in those areas to whom they might provide strategic advice or information. It merely means they are not performing any deeds--that is, direct lobbying--that would require them to register.

    For the Lobbyists Registration Act to live up to its intended spirit, I believe it is important that all the activities of consultant-lobbyists with respect to lobby campaigns be subject to disclosure. In short, the section that excuses those “requesting information” from registering this activity should not apply to a consultant-lobbyist who, for pay and on behalf of a client, engages in obtaining information with respect to any of the categories that would require registration otherwise.

    The persistence shown by the government and the lobby community in preventing this information from becoming public raises suspicions, in my mind.

    My second point or concern relates to the downgrading of the overseer, as it were, of the legislation, the ethics counsellor.

    While this committee beavers away at Bill C-15, which contains reference to the ethics counsellor throughout, another committee in the House is considering legislation, the draft of which would do away with the role of this person in overseeing lobbyists altogether. I don't wish to go down the road of the independent ethics counsellor here. I'll leave that to the Standing Committee on Procedure and House Affairs. However, I wish to note that the bill establishing the independent ethics counsellor would remove all reference from this act.

    I would encourage members to revisit this subject on pages 94 and 95 of the 1993 red book. The gist of the words you'll find there is that someone senior—whether independent or not—should have, “the power to investigate complaints and review specific dealings between the government and lobbyists to ensure that the Codes of Conduct are honoured”.

    Let me state most emphatically that, in my view, it would be a major step backwards to return to the pre-1993 state of affairs, where a junior government executive in Industry Canada is put in charge of this act. Any complaint against a lobbyist or other investigation of wrongdoing would likely involve a senior government official, or minister, as well as lobbyists often connected to very powerful political figures.

    As Industry Canada is one of the most frequently lobbied departments, the issues might even implicate their own superiors. What kind of junior official is going to charge into that sort of lion's den? Only someone who wants to be a junior official for a long time, I would suggest. Yet this is the long and short of what seems to be unfolding here. The red book recognized, and took into account, the relationship between lobbying and politics, lobbyists and politicians, and this must not be forgotten in any act.

    I would encourage members to look at the new lobby legislation in Quebec, the Lobbying Transparency and Ethics Act, Bill C-80, chapter 23, 2002. It is by far the best in Canada. Specifically I would draw your attention to the role and powers of the lobbyist commissioner laid out in division 2, paragraphs 39 to 44. I'll read briefly from these:

39. The Lobbyist Commissioner may, on the Commissioner's own initiative or on request, conduct inquiries if the Commissioner believes on reasonable grounds that there has been a breach of any provision of this Act or of the code of conduct. ... The Commissioner and any person specially authorized by the Commissioner to conduct an inquiry have, for the purposes of the inquiry, the powers and immunity conferred on commissioners appointed under the Act...except the power to order imprisonment.

    The Commissioner or his or her delegate may also:

(1) enter, at any reasonable time, the establishment of a lobbyist or a public office holder or the establishment where the lobbyist or the public office holder engages in his or her activities.... (2) require the persons present to provide any information concerning the activities engaged in or the functions exercised by the lobbyist or the public office holder, and to produce any book, register, account, record or other related document, and (3) examine and make copies of documents containing information relating to the activities....

Every person who has custody, possession or control of the documents referred to in this section must, on request, give access to them to the person conducting the inspection and facilitate their examination.

    I suggest that the need for a suitable overseer with the powers as prescribed in the Quebec act would be desirable for the LRA.

    Now let me briefly raise one other point, and that's fee disclosure. As you may know, many jurisdictions with lobbyist registration regimes have some form of fee disclosure. In my opinion, fee disclosure accomplishes two worthy public policy objectives. First, it would indicate any propensity to cash in on political connections. Again I refer to page 95 of the 1993 red book, which states:

One of the largest areas of concern...has been the sometimes exorbitant fees lobbyists charge their clients for helping them to obtain large government contracts. The Ethics Counsellor will have the power both to require reporting of lobbying fees in relation to government procurement contracts and to disclose publicly any contract, fee, or activity that may be contrary to the Code of Conduct for Lobbyists.

    Over nine years I know of no instance where the ethics counsellor has made such a request, nor do I see what would trigger such actions. I would also argue that there are things other than a sale to government that can have significant value to people outside of government.

    Yesterday I searched for the 1986 report of the U.S. special prosecutor, Whitney NorthSeymour, Jr., concerning the lobbying of former presidential counsel Michael Deaver. I was unable to come up with a copy. However, in the concluding section, Seymour compared the fees charged to clients with the services rendered, and asked—and I'm quoting from memory here—what could Michael Deaver possibly have done in the space of a half-hour meeting with his former colleagues in the White House that would merit a fee of $250,000?

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    I would also say that fee disclosure has the potential to inform the public of the extent of any lobbying effort and the intensity of any lobbying campaign. I, and all of the MPs around this table, know there's a huge difference between an advocacy campaign with a budget of $30,000 and another of $500,000. Without fee disclosure, you would know a company was lobbying on an issue; with disclosure, you would also know how hard they tried.

    In an era of greater transparency of party and leadership campaign contributions and more reliance on advocacy and interest group politics, I can think of no reason why the amount spent on policy advocacy by the back door, so to speak, should remain shrouded in mystery.

    For consultant-lobbyists, I offer what Quebec's act says on fee disclosure. Paragraph 9 notes that they must disclose:

    

the range, among the following, within which the amount or value of any financial or other compensation received or to be received in return for the lobbyist's activities falls: less than $10,000, from $10,000 to $50,000, from $50,000 to $100,000 and $100,000 or more;

    Organizations and corporations should be required to report the amount paid to any consultant or outside group, as well as the amount spent in-house—perhaps minus salaries—over the period covered by their semi-annual registrations, as is the case in the United States.

    Finally, I would suggest that the term “significant”, which triggers a registration, be decreased from the current 20% to 10%. I'd be happy to explain my reasons why during the questions and answers.

    Thanks for your time and attention. I apologize for going over time; I timed it at 11 minutes. I will be happy to answer any questions and provide any references or copies to which I referred.

    Thanks.

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    The Chair: Thank you very much, Mr. Chenier.

    Mr. Brian Grainger, from Grainger and Associates.

    Mr. Brian Grainger (Grainger and Associates): Thank you very much, Mr. Chairman.

    I'm delighted to be here once again. My 12 years working inside and outside of Canada in the area of codes of conduct, codes of ethics, and education training around those in the government and the private sector have taught me an important lesson, or a best practice, that I once again would like to bring to the attention of all members.

    Although it's very important that Bill C-15, or any other ethics initiative going right now, be very clear and have as high a bar as possible, I've learned that if you don't educate and prepare the lobbyists, the clients, and the public office-holders/public servants--at the senior level at least--it's not a waste of time to put the legislation in place, but the legislation, whatever it may be, is much less effective.

    I'll give you an example of what I mean. Australia and others in the OECD and G-7 have tried to make sure that lobbyists, their clients, and the public office-holders have a very good understanding of the limitations, parameters, and objectives--the whole kit, if you like--involved in this legislation or similar legislation. It makes it much more effective.

    I share some of the comments of others before me, and others before this session last May, that we can certainly improve any piece of legislation. No matter how tough it may be, it has been found in this world of ours that when it comes to codes--and this is an unwritten law--the tougher the code, the more someone is going to find their way around it if we haven't touched them on their professional judgment around their values and how to implement this piece of legislation with a values-based approach.

    Compliance-based or rules-based systems are very good for getting airplanes off the ground, but they're lousy at making sure this kind of legislation is adhered to and respected in the spirit of the law. We could do a tour of the table, if you like, all around the world, especially of the OECD and G-7, and talk about what they're doing, for sure. But the ones that are working are trying to explain to all three parties--in other words, it takes more than one person to tango in this game--what is expected of them and how to implement it.

    Even though it's difficult to legislate ethics--if some would agree with that--I do believe it's possible to educate and, dare I use the word, train people like myself, other professionals, members of Parliament, public office-holders, clients, and lobbyists how to respect this act. Without some of that education, it's going to be very difficult to see this implemented the way all of us, including yourselves, of course, and other interveners today, would very much like to see it implemented.

    We can go on to talk about the fact that since 1989 this legislation has been improved, and I'm sure we'll have the opportunity in questions and answers. There's no question the definition section has improved, and the movement toward enforcement and investigation is certainly a lot better than it was in 1996. The lobbyist code, in comparison to any number of codes we could put forward, is very clear.

    But as I said a moment ago, we need to get people up to speed on the expectations, the spirit of this legislation, and not simply whether or not they have to jump when they're told to jump. There must be more to it than simply compliance. There has to be a professional appreciation and the will to embrace this legislation, the code of conduct, and the kind of environment all of us here, including the interveners, have been trying to speak to over the last couple of years.

    Finally, it would be wise of us to look at this legislation as not simply a single piece of legislation standing on its own. I agree it has to have merit on its own, but if you look at it in terms of a package, in other words, what else is happening, it's very important to know that we've upgraded--and necessarily so--the ministerial code.

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    We've looked at relationships with crown corporations. We've taken a look at the MPs' code. I'm sure members have seen that code. Some of you probably believe it to be either good or even onerous, but that's the way we're going. It's part of the environment and climate. And there's also a deputy minister's performance and accountability piece forthcoming, as well as a public service code or, if you prefer, a set of principles.

    I state these not as an apologist for any of those preparing this, but simply because it's the package that counts. We're creating an environment and a world that is not 1992. It certainly isn't 1955 either, and this document is not a 1955 Buick that belonged to my grandfather or my father. We're in a different world, and this talks to the new world.

    Thank you, Mr. Chairman.

    The Chair: Thank you very much.

    We'll now hear from Mr. Duff Conacher, part of the Government Ethics Coalition.

    Mr. Conacher, welcome.

    Mr. Duff Conacher (Coordinator, Government Ethics Coalition): Thank you very much, and thank you for the opportunity again to speak to this issue of the lobbying law and related issues, specifically today with regard to Bill C-15.

    I'm here today representing the Government Ethics Coalition, a coalition of 32 anti-poverty, consumer, corporate accountability, democratic reform, environmental, human rights, international development, labour, women, and youth groups, whose collective membership represents over two million Canadians in total, including 12 national groups and 20 groups that are located in six provinces and the Northwest Territories. I will be submitting to the clerk a list of the groups in the coalition.

    Turning to the bill, first of all, generally, I agree with many of the points that John Chenier and Brian Grainger have made already, and just for the sake of continuity, I'll start in terms of the changes the coalition would like to see in Bill C-15. I'll start with the points John Chenier raised.

    While Bill C-15 does propose to close some loopholes in the lobbyist regulatory system that currently exist under the Lobbyists Registration Act, specifically in the areas of lobbyists who are invited to lobby government and the registration requirements for in-house corporate lobbyists, there are still key loopholes that will mean that secret lobbying and unethical ties between lobbyists and politicians will be able to continue and be perfectly legal.

    Overall, we see that the bill's generally half measures show clearly that the Liberal government seems to believe there is nothing wrong with the federal government being driven behind closed doors by wealthy corporations and their high-powered lobbyists. These loopholes need to be closed if there is going to be governing with integrity, as the Liberals promised in 1993 very clearly in the red book.

    Starting with the point that John Chenier started with, the coalition would like to see the whole system reversed and have ministers and other senior public officials required to disclose who is lobbying them. That's the only way you're going to have all lobbying exposed. But we don't expect that you will completely change the whole system. You're still putting the onus on lobbyists, even though it is ministers and senior public officials who are legally required to uphold the public trust, not lobbyists. If so, then loopholes that currently exist in the registration system, the disclosure system, need to be closed.

    The coalition agrees completely with not only what John Chenier has recommended, but also how he has stated the problem if you continue to leave a loophole that allows lobbyists not to register when they are communicating--as it says in the proposal, communication restricted to a request for information. These kinds of activities need to be covered by the law.

    We also believe that not only paid lobbyists who are required to register currently and required to register under the proposed bill but also unpaid lobbyists should be required to register, and the threshold should simply be a time threshold. If a significant amount of time is spent lobbying, then there should be a requirement to register.

    We have heard stories, but obviously it's very difficult to track these problems given that there's no registration of them, of corporations using former executives to do their lobbying. Their former executives are no longer paid. They are still, though, very much identified by public officials with the corporation. The lobbying occurs, but no registration occurs. So we believe a time threshold is the only threshold that should need to be crossed.

    Why a time threshold? Well, you wouldn't capture the average Canadian writing a letter to a public office-holder, but if they wrote 10, 15, or 20 letters and spent a significant amount of their time over several months, then they would be contacted by the registrar and a determination made. It's not that they'd be penalized for not knowing about the law, but they would still be required to register.

    Moving to John Chenier's second area of concern--that is, with regard to the enforcement--the proposal to switch from the ethics counsellor to the registrar to enforce the lobbyists code, I disagree with John Chenier a bit. I don't see it as a problem in terms of the powers of the registrar, because under the Lobbyists Registration Act currently, the registrar has the full powers of an inquiry judge, so as many powers as the commissioner will have. It is just starting up in Quebec under their law.

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    However, it's a difficult problem for this committee to address, because the changes to the Parliament of Canada Act are before a Senate committee and a House of Commons committee, the procedural affairs committee. Those changes are the ones that switch it to the registrar from the ethics counsellor, in terms of enforcing the lobbyists' code.

    What you should be aware of, and hopefully alert your committee colleagues and the minister to, is that you're going to end up with conflicting rulings. The registrar will be upholding the lobbyists' code of conduct. Rule 8 of the lobbyists' code of conduct states that a lobbyist cannot undertake any activity that constitutes improper influence or puts a public office-holder in a conflict of interest situation. A public office-holder is defined as an MP, senator, or minister.

    If you have a complaint about a lobbyist going to the registrar, that the lobbyist has violated rule 8 and put a public office-holder in a conflict of interest, the registrar will rule on the lobbyist and whether the lobbyist put the public office-holder in a conflict of interest, while the new ethics commissioner will rule on whether the MP, senator, or minister is in a conflict of interest. What if the rulings of these two entities conflict? What if the registrar says the lobbyist did put the minister, MP, or senator in a conflict of interest, but the ethics commissioner says they weren't in a conflict of interest? Where does that situation go?

    What is proposed is as unworkable a system as the one that currently exists with the current ethics counsellor. The ethics counsellor is in a conflict of interest because he is controlled in one of his two jobs, because there are two ethics counsellor positions, one for lobbyists and one for ministers. In his job overseeing ministers, he is controlled by the Prime Minister.

    You are now setting up two offices that will conflict with each other, even though they both have the independence that people have been calling for, for some time, from the Prime Minister.

    The only way to solve this, and the only way that makes any sense at all, is that the new ethics commissioner also be given the power to enforce the lobbyists' code of conduct. Take it out of the registrar's hands and put it all into this one entity. And while you're at it, add the public servants' code of conduct and allow the ethics commissioner to enforce the public servants' code of conduct and to protect whistle-blowers who blow the whistle on violations of any of these codes. It simply makes sense. Otherwise, you are going to have conflicting rulings and you're going to have as many problems as we have seen over the past nine years in terms of enforcement of the code.

    Moving on to the third area that John Chenier raised, it's not so much the fees that the coalition would like to see disclosed. What has been raised in the past is that the federal government cannot require fees to be disclosed, because those are matters of contracts, and contracts are property matters and are within the constitutional jurisdictions solely of provinces.

    However, you can require the clients of lobbyists, under a federal law, to disclose how much they spend on a campaign. We haven't quite believed this whole constitutional jurisdiction issue, but if you want to test it, then require that they disclose how much they spend with two separate line items, one for the amount they spent on their lobbyists and the other for the amount they spent overall on their advocacy campaign, in terms of newspaper ads, etc.

    We believe Canadians have a right to know this information. It goes to the merits of the decision. Were decisions bought? Did all sides of an issue have equal resources, with the government able to hear from all sides equally, making a decision on the merits? How much was spent by the four banks that were proposing to merge back in 1998? I've seen figures ranging from $30 million to $100 million. Canadians have a right to know what it was. How much did the Bank of Nova Scotia, which was against the merger, spend? I can tell you how much our coalition spent. We had $170,000 to spend.

    That should all be registered, and Canadians across the country should be able to search the lobbyists' registry and easily determine whether one side is simply overwhelming politicians by the amount of money they have. It is in the public interest that Canadians be able to easily access this information.

    Moving on to the other key areas or key loopholes that the coalition sees in Bill C-15, the coalition disagrees with John Chenier that it is perfectly fine that lobbyists are working in senior campaign positions for politicians, candidates for public office, and parties. In fact, the Prime Minister disagrees as well. In June, he brought down a guideline saying that lobbyists cannot work with a minister whom they are lobbying on any private, personal, or political activity. Broaden that and make it law, not just a guideline for ministers. Simply make it a prohibition across the board that lobbyists cannot work in senior campaign positions for any politician, candidate for public office, or political party, as is the case in Maryland and New Mexico. The Prime Minister believes in this principle. There's no reason why it shouldn't be in the act.

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    Also, lobbyists should be prohibited by law from working for the government or having business ties to anyone who works for the government. The ethics counsellor has put forward an interpretation bulletin saying that lobbying firms have to maintain a so-called Chinese wall between their communications divisions that do work for the government and their lobbying divisions that are trying to lobby the government. There are no Chinese walls out there. The ethics counsellor doesn't even have any power to go in to audit whether this interpretation bulletin is being followed.

    We need to eliminate the clear pattern of abuse and unethical ties between politicians and lobbying firms that has been most directly illustrated by the finance minister in the past nine years. Paul Martin has his ties to Earnscliff, and work has been done for him by lobbyists at Earnscliff and by others at Earnscliff in the communication division.

    Finally, in order to close another clear loophole, the whole revolving door needs to be shut much more securely than it has been by any law or code. The best way to do that is to prohibit ex-ministers and former senior public officials from lobbying the government in any way for five years. For ministers, it's currently a two-year prohibition, with a one-year prohibition for former senior public officials, if that provision is even enforced, which it hasn't been by the ethics counsellor. It needs to be five years.

    The fact is that these people can go out there and their inside access and influence and knowledge has market value. This shows that Canada, the federal government, is not a democracy at all, because they can sell their inside access and influence for top dollar. It shows that the government is not acting in a way that is citizen-driven, that it's not reviewing issues based on the merits, and that it is a “who you know” system. The only way to eliminate that is to keep those people out of the lobbying business for a longer period of time by increasing the prohibition to five years.

    The Chair: I must cut you off.

    Mr. Duff Conacher: I will be passing out a one-page, bullet-point list of recommendations to you, and I welcome all of your questions. Thank you very much for this opportunity.

    The Chair: Sorry about that, but I let you go over by two minutes, and then three minutes, and it was a bit too much.

    I will now start off with questioning. Maybe you can finish some of your points during the questioning.

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    Mr. Duff Conacher: Those were all of them.

    The Chair: Mr. Rajotte.

    Mr. James Rajotte (Edmonton Southwest, Canadian Alliance): Thank you, Mr. Chairman.

    Gentlemen, thank you for coming in today and for your comments.

    I want to start off with something that two of you certainly raised, which is paragraph 4(2)(c). Mr. Chenier and Mr. Conacher, you both raised it. What is your recommendation as to what we do with this? The committee recommended that this section be deleted altogether. It's now being replaced with the new section. Do you recommend that we go back to the old section, or do you recommend that the section be deleted altogether?

    Mr. John Chenier: My recommendation would be to delete it altogether. The purpose seems to be to not require people who simply collect information to register. My point would be that this is what most of the Ottawa lobby community does. That's what they're paid to do. From that, it becomes an integral part of the campaign strategizing and implementation.

    When that was removed, I said hooray. When I saw them grappling with a definition that said “communicating with an attempt to influence”, and then saying they were going to take “with an attempt to influence” away and leave just “communicating”, I said that lobbying is finally going to be reported. But then I go down the bill and see that, oops, they don't have to register if they're just seeking information. Of course, that's going right back to “communicating with an attempt to influence”. The purpose of that has always been to exclude, in my view, what the majority of lobbying activity is comprised of and what the majority of people do.

    I'm not saying consultant-lobbyists don't register. What I'm saying is that they have a practice of deciding how many people they want to register for and which campaigns it will be. For those that they don't wish to appear in, they don't have to because they can easily structure the campaign so that this is the case. If this remains, it will allow that to continue.

    Personally, I don't think it belongs there, but that's your decision. I'm just saying the effect of that is simply to continue the practice.

    Mr. Duff Conacher: I agree. Simply eliminate paragraph 4(2)(c) and then you'll be left with 4(2)(b), which is essentially saying communication “with respect to”, which could be changed to “with regard to”, another wording.

    We're happy to see this broadened. We thought it would eliminate this loophole. At the same time, we're a bit disgusted because the whole change of not enforcing “communicate with an attempt to influence” was a big sham created by the government in order not to charge René Fugère with breaking the Lobbyists Registration Act, simply because he's the right-hand man of the Prime Minister in Shawinigan.

    It is somewhat closed by changing it to “communication with respect to”, but you're still leaving this huge loophole. I again agree entirely with John Chenier that it will leave the discretion in the hands of the lobbyists in terms of whether to register or not and will be as unenforceable as the previous wording, as the Department of Justice claims.

    Mr. James Rajotte: My second question deals with the whole notion of the enforcement of the lobbyists' code. The recommendation from the committee in June was

that the Act be amended to create a new office, which shall have the exclusive responsibility of investigating and reporting to Parliament on alleged violations of the Lobbyists Code of Conduct.

Mr. Conacher, you recommended that this all be brought within the powers of the ethics commissioner.

    First of all, I'd just like to ask this of all three of you. Mr. Conacher has made his position known, but I'd like to ask the other two witnesses whether you agree with this and whether it should be brought within the power of the ethics commissioner.

    Secondly, I don't know if this is a fair question, but should we wait until the rest of the package is through Parliament before we make our decision on this bill? I assume we'd have to go through this bill again if that committee recommends either that way or another way.

    Mr. John Chenier: I can make two points with respect to that.

    As I see it, the draft bill creating the independent ethics counsellor simply removes from the Lobbyists Registration Act any mention of the ethics counsellor. That's the way it goes about it, so I don't know how you would, other than perhaps removing that and leaving your reference to the ethics counsellor in. However, they would then have to come up with wording to incorporate your concerns from the lobbyists' registration angle.

    I would argue, though, that there needs to be a senior, independent person to oversee the act and the acts of lobbying, which is essentially where policy and politicians often meet. There's a growing amount of money being spent in Canada and elsewhere, in other jurisdictions, to attempt to influence policy. Again, I don't think it's wrong. It's just a fact. But sometimes...am I going on too long?

º  (1615)  

    Mr. James Rajotte: No, I just want to....

    How should that person be chosen? How would you recommend choosing that person?

    Mr. John Chenier: I think it should be an independent person. I think that person should report to Parliament, because they could be reporting on anybody: a senior official, a member of Parliament, a senator, a minister. So the office has to have an individual who has the gravitas, shall we say, and the independence to take on some of these issues.

    I would also add one other thing, and it's evident in the Quebec act. It seems to me that you need some sort of audit function. Right now, a lot of the information that is provided is not necessarily what I would call clear. As a matter of fact, it's often obscure, and the lobbyists have intentionally obscured their lobby target while using the act as it is, just by checking off a bunch of departments that perhaps aren't relevant to the lobby campaign.

    It seems to me that we need an independent ethics counsellor whose job or office—as it will be in Quebec—is to sometimes audit these registrations, to actually walk into the office and say, “You said you were going to do such-and-such. Can I see the contract?” You might then impose some kind of honesty. And I'm not saying everyone's dishonest. All I'm saying is that you would certainly make the people think twice before filing a false registration—something they don't have to even think about today, to be honest.

    So, yes, we need reinforcement, and, yes, it needs to be independent.

    Mr. Duff Conacher: If I can pick up on part of where I think you're heading, I wouldn't go into detail on the ethics commissioner proposals because they're not a part of a bill but are before this other committee.

    We disagree with the appointment process. It should be done with the approval of all the parties of Parliament. But if it is a separate office, as long as rule 8 in the lobbyists' code is there, you're going to end up with conflicting rulings or the possibility of conflicting rulings. That's going to be a very unresolvable situation when the lobbyists' registrar, as is currently proposed, says the lobbyist put the minister in a conflict, while the ethics commissioner says the minister is not in a conflict in this situation. Both of them are going to have to look at it, because under the proposals, when there's reasonable belief that the codes have been violated, both are required to investigate. So you're going to have this conflict. That's why you should just put it under the one office.

    But there are other things we disagree with in the proposal, such as how that office would be structured and appointed, including the idea that opposition parties are being shut out of it. It's just going to be a cabinet appointment as proposed.

    The Chair: Mr. Grainger, do you have a comment before I go to the next speaker?

    Mr. Brian Grainger: Yes, please. Taking a perspective, and it's a very good question you've posed and I'm intrigued by the responses of my friends here, in the G-7--pick England, pick the States, or whatever--there are a number of ethics commissioners who are independent at the federal or national level, if you like. It does not appear to have made for a particular problem.

    In fact, I might suggest that in the case of just one, the jurisconsult in London, in the Parliament of England, versus the public conduct office, it has been important to separate the two for at least two reasons--one, I'll use the word small-c constitutional. In other words, why would you have some things messing around in Parliament and with members' privileges? That seems to be in the wrong place. Perhaps that independent commissioner has too much under her or his purview.

    On a straight governance level, corporate governance or good governance level, the other problem there is confidentiality. At some point, when you have all these things happening, it's kind of nice to know that the privacy commissioner, for example, is over here and the other commissioner is over there, and so forth. I'm not sure if members want to risk too much in one office where their private MP code material is sitting around. I would caution them on that one. We have a good record in this country, I should quickly add, but still, I would be very careful about that.

    I think a person with a larger role or more independent in terms of the registrar function, if you like, has perhaps some merit, and we do have models. The government, as you may know, created the role of a public service integrity officer, Dr. Edward Keyserlingk, sitting in the Privy Council Office, and I haven't heard anyone suggest that this isn't a man of great character and great independence.

    So we have ways of dealing with the registrar issue as has been raised, and maybe it should be, for argument's sake, outside one department--let's call it the industry department at the moment--and put in somewhere else. But we have models that would keep it out of the Auditor General/independent commissioner role.

    Finally, I stand to be corrected, but as far as I know, parties are going to be consulted and Parliament has to agree on the independent commissioner, and I've seen nothing to the contrary. If members would like to correct me, I'd be delighted to be corrected.

º  (1620)  

    The Chair: Thank you.

    Mr. McTeague.

    Mr. Dan McTeague (Pickering—Ajax—Uxbridge, Lib.): I'll cede to Mr. Bagnell, Mr. Chair.

    Mr. Larry Bagnell (Yukon, Lib.): Thank you, Mr. Chair. I just have one quick question, so if I can share my time....

    I apologize for not being here when you started; I was speaking in the House of Commons, and unfortunately I have to rush back there. But I was very interested in what you were saying.

    I have one question, and I'm probably more in agreement with you. It's on the clause about people just calling for information. I probably agree with your position, but just to be the devil's advocate, what I was saying in the House of Commons when you were giving your presentation here was that there's a disconnect between my constituents, because my riding is the farthest in the country from Ottawa. All those rural ridings and those distant from Ottawa and the House of Commons don't feel connected, because they can't see what's going on as much, and they can't walk into the offices, and so on.

    I was in a restaurant on the west coast and asked someone what province the House of Commons was in, and they didn't even know.

    So by having this amendment, freeing up the ability of people to phone Ottawa--and remember, when they know that little about Ottawa, it could be anyone in Ottawa. Do you think having such an amendment would free up people just to call for information, which hopefully they would do more, look for information? But all of a sudden they think, well, without that amendment I might be charged; I haven't registered as a lobbyist. You know how these things work in reality; people think this way, and they just don't bother. Do you think there's any possibility that by not putting that amendment we would reduce people's comfort, the comfort of some people on some occasions, to connect with Ottawa in a harmless manner?

    Mr. Duff Conacher: I don't think so, if you put in a time threshold and say you have to spend a significant amount of time and that's the threshold.

    You can leave it as just paid. So then you're going to capture a small slice.

    There are lots of volunteer groups out there that lobby quite a bit, and they don't have to register. But we think you should capture some of those voluntary groups, because sometimes they're quite powerful, and we think Canadians have a right to know that people are spending hours and hours and months and months meeting with lots of people here in Ottawa.

    But as long as it's a significant amount of time, you're not going to turn off an average Canadian from calling and asking what's going on about one issue, once a year or even ten times a year.

    The Chair: Mr. Chenier.

    Mr. John Chenier: I have two points. One, my comments were directed at the paid consultant-lobbyists, who basically spend most of their time doing that, and not at the average citizen. In other words, you'd have to be paid to lobby on behalf of someone else before this would become applicable. You could essentially put that underneath the requirements for consultant-lobbyists, because each one has different requirements for registering, how they register, and what they have to register for.

    Secondly--to pick up Duff's point--there are some things in there dealing with grassroots lobbying. I think it's very important to get at organized attempts to get people to write about or try to influence public policy. But I would underline the term “organized”. That means people who try to organize through registering, and not the person who's writing the letter on behalf of this or becoming part of the campaign itself. It's those people who organize it that we're trying to catch.

    The Chair: Mr. Grainger.

º  (1625)  

    Mr. Brian Grainger: I tend to agree with where John and Duff are coming from, but there's an amazing amount of “how many angels dance on the head of a pin” these days, and this goes in that direction. In other words, just how many ways are we going to tell people not to do this, do this? While there may not be confusion, I think a number of Canadians are going to say, “Hey, we could have figured that out ourselves”.

    We should be following what we're all saying about paid lobbyists. Those who want to disguise themselves as something else should be known. That seems to be the purpose and the goal. A lot of Canadians, if not all of them, are quite smart enough to figure that out. There's just so much we're putting in legislation, hoping to catch the horse that's already out of the corral.

    This is more of a common sense, logical response. My theme is that we're trying to clean it up there for sure.

    The Chair: Monsieur Crête.

[Translation]

    Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ): Thank you, Mr. Chairman.

    Thank you for your very interesting presentations that will give us food for thought. I have a question that perhaps may be directed more to Mr. Conacher, but if the others have opinions on the matter, please feel free to give them.

    My question pertains to the information request that we have already discussed at great length. I want to ensure that you understand this issue as I do. We, the members of Parliament, often request information over and over again in the committees. However, if we ask a question that involves details and clarification, we ultimately wind up lobbying or influencing.

    Mr. Conacher, is that the matter that you are raising, namely, that when there is a request for information, that this should indeed be part of the disclosure. Otherwise, we won't be able to distinguish between a party that we want to influence and a party where there is simply a request for information per se.

[English]

    Mr. John Chenier: Monsieur Crête, are you saying that members of Parliament would be subject to this, or people writing to you?

[Translation]

    Mr. Paul Crête: No. I was referring to members of Parliament, meaning that we too, in doing our jobs, at times must ask questions and, even in asking a question, we influence the answer. Is this not something of a parallel that you are drawing, when you say that if there is no registration, that will perhaps open the door to conduct which, otherwise, should not be tolerated?

[English]

    Mr. John Chenier: First of all, the act excludes members of Parliament, and wouldn't affect any of those other groups that are excluded, of which there are seven or eight.

    In 1989, when I began writing about this, my first indication was when I saw “with an attempt to influence”. There were seven categories, and one of them explicitly omitted going after information. I said, “I can think of a dozen ways one could pose a question seeking information that would direct the thinking of a person.” I know lobbyists do this quite often. In posing the question, they indicate the answer they would like. So that, in part, is one of my concerns.

    But there is a lot of information gathering, which is an integral part of a lobbyist's campaign. It is an integral part of the payment, the contract, and everything like that. At the moment, that does not need to be disclosed, and I feel it does.

    Sorry to use your time to go back to Duff Conacher here, but he suggested that because I believe lobbyists are intricately involved in the game of politics, I'm condoning certain behaviours. I'm saying that right now a lobbyist can be working for a minister and have clients who have interests in that minister's department, but because they're only giving them information or advice, they don't have to register that activity.

    I am arguing that if this were removed--and I'm not going to name names here--any lobbyist who was also very active in a minister's campaign, or closely tied to a department, would have to disclose those clients and that they were indeed advising them. Then the cat would be out of the bag. My point is that would not be tolerated, and I don't think I would tolerate it either. Right now, I'm just saying it doesn't have to be disclosed.

º  (1630)  

[Translation]

    Mr. Paul Crête: Does Mr. Conacher have anything that he wishes to add?

[English]

    Mr. Duff Conacher: I agree with Mr. Chenier again, in terms of the importance of closing this particular loophole of information gathering. I wish I could agree with him that it would not be tolerated if a firm were both lobbying a minister and working for a minister. But that has been tolerated for nine years by the ethics counsellor, who has simply repeatedly failed to uphold his legal duty to enforce the lobbyists' code of conduct.

    We have nine outstanding complaints in to the ethics counsellor about lobbyists breaking rule 8 and putting ministers in conflicts of interest. Of those, three are over two years old, three are over one year old, one is five months old, and another two we've filed in the past month and half. He hasn't ruled on any of them. There's no reason for those kinds of delays.

    That's what's so important about ensuring independence and effectiveness, and not just creating a situation with a new ethics commissioner and the registrar, who will possibly be at loggerheads because of rule 8 in the lobbyists' code. You don't eliminate the rule. You need a rule that says lobbyists can't put public office-holders in a conflict of interest. You eliminate the conflict between, right now, an ethics counsellor who is controlled by the Prime Minister and making decisions about lobbyists putting the Prime Minister in a conflict, or, in the future, as now proposed, a registrar and an ethics commissioner possibly making conflicting rulings.

[Translation]

    Mr. Paul Crête: Are there any countries which have any experience or legislation pertaining to information disclosure that would be of any use to us as a model? Could we obtain a sample of what works well and what does not work so well, so that we could determine whether, in our bill, it would be appropriate to look elsewhere for a way that would enable us to respond to your objection pertaining to information?

    My question is for anyone who wants to answer.

[English]

    Mr. Duff Conacher: You can. It's simply a matter of having an appointment that's more than arm's length from cabinet. The powers are there, both under the current Lobbyists Registration Act for a watchdog over lobbyists and in the proposals to the changes to the Parliament of Canada Act for the new ethics commissioner.

    There are some problems with the powers. When investigating MPs and senators, the results of the investigations will be reported, in secret, to a joint committee of MPs and senators. So that's not the best way to go.

    All the rulings should be public. The public is going to be shut out of filing complaints in the future, and that's a mistake. But generally, the power structure and the appointment structure are there in what already exists or what's proposed in these changes to the Parliament of Canada Act.

    The Chair: Mr. Grainger, did you have a point on that?

    Mr. Brian Grainger: Yes. Correct me, Mr. Chair, or others, but I'm sure there has been some research done over the last year or two by staff to this committee and others on this point.

    In Great Britain, under Prime Minister Major, there were some most embarrassing questions—which touches on the very points you've raised about members of Parliament and information gathering—paid for by lobbyists, questions in the House of Commons. Among others, one of the lobbyists is rather famous for who he thought he'd be the father-in-law of. They put in place this exceptionally interesting landscape or ethics package, which everyone—the G-7 and ourselves—now has, if you look at what has been happening in the last couple of months and last year. England put in place a code of conduct that affected both parliamentarians and public servants.

    The country that doesn't have a written constitution, but only the Magna Carta of 1215, had to put in a full or detailed package somewhat like the one we're just talking about all around. If you look at what they did with lobbyists and members of Parliament in their office of public conduct—which is found on the website of the government of England—you'll find this point is well covered from the point of view of the expectations of lobbyists, members of Parliament, and senior public office-holders—and senior public servants, for that matter.

    The experience to date has been very positive because it has narrowed down the problems, much in the way that John, Duff, and I would like to see them narrowed down. It has really brought the issue down to much smaller issues than the major problems with lobbying. So I would urge that we take a look at that model.

    There are other models. The Australians have done much the same thing. The American model is very complicated because of the nature of the size and structure of government in Washington, but it has some useful examples, as well. But I would mention Great Britain and Australia, looking at the actual workings of this public conduct office.

º  (1635)  

    The Chair: Mr. Chenier.

    Mr. John Chenier: I would just like to add that legislation in this area, like many others, becomes sort of an iterative process. The Americans, for example, had fee disclosure. The fees disclosed were only lunches, taxis, or things like that, and not other things. Then they brought in another law, which then led to slightly more disclosure. Then, finally, they banned lobbying as a tax deduction. So their law requiring disclosure on what lobbyists spent finally became understandable and enforceable, because they then had a tax law or an IRS definition of what lobbying was.

    In Canada we've had similar things. We've extended the statute of limitations from six months to two years. Quebec's statute of limitations, for example, is three years—based on experience that sometimes these things come up much after the fact. I'm sure that even if all of our suggestions were taken, and the laws were changed to reflect some of our concerns and some of your concerns, there would be ways...I mean, our law has never been challenged in a court of law. We've never gone to court and had a judge say, “This is nonsense. Throw it out. This isn't lobbying or anything like it.” We don't know. Whenever it has come up, we have said, “Oh, it is past the statute of limitations”, or, “Oh, this definition of lobbying won't stand”.

    I would point out that the definition of lobbying used in the other four jurisdictions in Canada—British Columbia, Ontario, Nova Scotia, and Quebec—is to communicate with an attempt to influence.

    Anyway, this aside, I think it's an iterative process. Sooner or later—albeit not to my liking—we might have to go to court and put some flesh around some of the bones. But we'll never completely....

    The Chair: Merci.

    Mr. McTeague.

    Mr. Dan McTeague: Thank you, Mr. Chair.

    Thank you for being here. I apologize to my other colleagues for the delay in getting quorum here. Like Mr. Rajotte, I was caught in the wrong building. Unfortunately, we thought we were meeting in the West Block today.

    I was very interested in the rounds of questions that have been received. Your presentations have been very diverse and very helpful to the committee.

    However, I have a simple question, I think, with respect to the bill as it proposes to remove the exception for communications made in response for a request by public office-holders. What do you envisage this will do to the volume of registrations if we have one simple oversight—as Mr. Conacher has proposed—as opposed to a registrar and an ethics commissioner? Either way, do you feel you're going to see a trebling of registrations overnight as a result of this change?

    Mr. John Chenier: No, I think when we get to the consultative phase, for most organizations and corporations that are involved in very broad consultations, eventually that subject matter is reflected in one of the lines of their registration. Again, if you look at the registration filed by an organization, it can be this long in terms of the number of issues they're working on. Adding another line or six words to outline that issue is hardly going to increase the volume at all.

    When it comes to consultant-lobbyists, yes, there would probably be a surge, I would say, of probably double or triple the number of registrations. But this is an automated system. We're not talking about something that's going to overload it by any means. As a matter of fact, I believe the system was designed to handle probably about ten times the registrations that it currently holds. So in my view it's not going to flood the system or be an undue hardship on anybody.

º  (1640)  

    Mr. Duff Conacher: I think the increase you'll see is more in the area where there will be a level playing field between what I have to do now as a coordinator of a not-for-profit corporation that lobbies as opposed to what for-profit corporations have to do. Bill C-15 proposes that there will be a collectivizing of the time spent by for-profit corporate lobbyists, and they will all have to be listed. We have to do that already; we have to list anybody we pay and take into account all our work in terms of crossing that 20% threshold.

    But in terms of in-house consultant-lobbyists, I think they'll use proposed paragraph 4(2)(c) and just rearrange their activities to hide anything they want to hide. So there won't be an increase in registrations. They'll just say, well, I was lobbying on that directly; now I'll just make the calls for information and you guys can do the lobbying. You're not spending 20% of your time doing it, so no one will cross any threshold.

    As I say, the proposed changes will not do enough to end secret lobbying and unethical ties between politicians and lobbyists. You would think the government would be interested in ending both of those activities.

    Mr. Dan McTeague: Mr. Grainger.

    Mr. Brian Grainger: I would suggest, as my colleagues have done, that the numbers are not the issue, and there's not going to be a large number or a large increase. I think what's going to happen is that perhaps some will go the way that Duff has suggested, but I'd like to think any number of them, being professional and certainly Canadian, would take the right road and register properly. That's what I've assumed of all lobbyists. I haven't met a lobbyist yet who has gone out of his or her way to escape every particular tentacle of this law or some other law.

    It's to abuse these Canadians to suggest that every one of them is out to rip off this country or to rip off some parliamentarian. I find that a very unpleasant thought. Sure, maybe some of them would go in the direction that Duff is mentioning. There are always those apples in anybody's collection. But I think maybe they'll just meet the requirements of the law and move on, go forward.

    Mr. Dan McTeague: I think all of us are intrigued, as members of Parliament, not ministers, as to the extent to which this is used, and members of Parliament of course do provide themselves with, and are provided, opinions on a constant basis. Are any of you concerned about the democratic freedoms of individuals to relate issues to their members of Parliament?

    Mr. Conacher, you talked a little bit about unpaid lobbyists, people who communicate or influence, for instance, a member of Parliament, who may not be paid. Is there not a fine line here, both with one's democratic rights as imbued in our charter as well as the role of the privilege of members of Parliament, which has to be considered as well?

    Mr. Duff Conacher: It's just disclosure. You still have a right to do it; you just have to let Canadians know you do it. How does that infringe your right to do it?

    Mr. Dan McTeague: Let me be more specific. Many of us have just come back from our ridings. I have a member of my legion who has a particular concern about the treatment of veterans in hospitals. Is that person required to, under this, under your rubric? Obviously the person is not paid by the legion. The person does services for the legion. He is retired, more than likely, and receives a pension. It would appear that some of this, the essence of what you're suggesting, would capture people like that and put them in a position where they obviously have to disclose what they're doing. But is that where we really want to go with this legislation?

    Mr. Duff Conacher: If they were spending a significant amount of their time in a threshold, just put the word “significant” in there and leave it to what I hope would be the independent ethics commissioner to do an interpretation bulletin, as has already been done, on what “significant amount of time” means for someone who's unpaid.

    No, we don't have to capture every letter that's coming through to you or ministers. There's a woman, her last name is Smith, I believe, who has been campaigning for years and years for better tax treatment of women's work at home. She should be registered. She was spending a lot of her leisure time lobbying, and just spending time with someone can be a powerful lobbying force. It takes once every six months to just spend two minutes on the Internet updating it. That doesn't infringe on your rights at all. It just makes it easy for people to know who is spending a lot of time lobbying the government, paid or unpaid.

º  (1645)  

    Mr. Dan McTeague: Mr. Conacher, I get a lot of people in my constituency, and I think my colleagues could probably attest to this, who spend an inordinate amount of time lobbying me on issues. Some of them are repeaters, coming maybe even on a monthly basis.

    One has to take into account whether or not what they're trying to do is influence, without being paid, the position I take with respect to a particular bill or act that is before Parliament in terms of whether or not we should treat these people as if there's some kind of overarching interest. And if they're not paid, then what, sir, would be the interest, in your view?

    Mr. Duff Conacher: They have their interest because they're forwarding an interest and they're lobbying. It's called the Lobbyists Registration Act. We're just asking for registration of lobbying.

    Mr. Dan McTeague: But you're suggesting that it include those who are unpaid, and I'm suggesting to you that there may be people in this country who would see that as a democratic right to be able to lobby their member of Parliament regardless of payment.

    Mr. Duff Conacher: And they have the right to do it.

    Mr. Dan McTeague: But you suggest payment is a factor.

    Mr. Duff Conacher: No, I'm saying they have a right to do it. This is just a disclosure act. Believe me, given how the ethics counsellor has been enforcing the act to date, no one's ever going to be charged. They're just going to be called up if they're in the papers or they catch wind...or if there's an access to information request and someone files it with the ethics counsellor, or the registrar, or the ethics commissioner--whoever enforces this in the future.

    They'll call them up and say, do you know there is a law? It just requires you to disclose. It's an easy thing to do; go to the website and it'll take you two minutes. And they'll do it. It doesn't infringe their rights to lobby. It's disclosure. We're not saying they can't lobby.

    Mr. John Chenier: I'm a bit confused here, Mr. McTeague. It seems to me if we take four quadrants here, we have, on the one hand, paid and not paid. Under those categories we have seeking information on both sides and we have advocacy on both sides. My concern is on the paid and whether they're seeking information or advocating that they should be required to register.

    If we're talking now about the unpaid seeking information, to me that's not even in the same ballpark. We're then talking about that fourth quadrant at the bottom, unpaid lobbying or advocating change.

    Mr. Dan McTeague: That's answered my question.

    Thank you.

    Mr. John Chenier: I don't know where you come down on that. If it's a grassroots lobby campaign and many people are organized, I would hope our lobby registration would pick up those people who are organizing and telling it to write in. But certainly not the person who's sitting there and one day they're writing “We need better pensions”, the next day they're writing “We need day care”, the next time they're writing on.... They're spending a lot of time advocating. But let's hope it picks the people who are organizing or signing up and not the people who are signing the individual letters or in a sense dedicating themselves to making their community better for no benefit of their own. Again, I think we have to draw a distinction.

    I will raise one thing, though, which I threw out in my discussion and no one picked it up, and that's a threshold. For some reason, over the last month I have had three charitable groups call me concerned about this 20% threshold and its interpretation. Their concern is very real, but perverse. They're concerned that if they register with the 20% threshold, they're in a sense saying that they are spending 20% of their resources in advocacy, which of course would strip them of their charitable status, because the charitable status says you may only do 10%.

    I talked to them and I said, yes, but it's 20% of a person's time, and that doesn't necessarily have to be 20% of your resources, that could be only 2% of your resources. There's a concern out there, and I would suggest to you that several charities are taking themselves off the registry because of that concern. I've encouraged them to call the lobbyist registrar. I don't know what responses they've been getting, but all I'm saying is this 20% threshold is causing some confusion out there among some groups.

    The Chair: Thank you, Mr. McTeague.

    I'll now go to Mr. Masse.

    Mr. Dan McTeague: Mr. Chair, I believe Mr. Grainger wants to comment.

    The Chair: Oh, sorry.

    Mr. Brian Grainger: Thank you.

    I'd like to make two quick points. One is that I don't think too many Canadians would welcome the notion that we're trying to capture, for example, someone who has been working full time following up on World War II pensions. I don't think that's going to sell. I dare say that no MP--forgive me for suggesting this--should be out there trying to sell that one.

    Secondly, based strictly on my experience of the last 12 years, if there's an ethics deficit worldwide or wherever you want to point your finger to, this point of leaving them out does not contribute to good corporate governance or an ethics deficit. It would not have saved us from Enron, WorldCom, Tyco, or--dare I even use it--Bre-X.

    I'd just like to repeat something I mentioned the other day in another place when asked about all of this. I pointed out that in the last 150 years there has been no example of a municipal, provincial, or federal public office-holder or public servant ever kick-starting the likes of Enron or WorldCom. So let's not create an environment in which we increase the trust problems between members of Parliament and whomever else. There has to be a balance.

    I have all the time in the world for the obvious critiques that you and my colleagues are offering about this bill. But let's take another look here.

º  (1650)  

    The Chair: Mr. Masse.

    Mr. Brian Masse (Windsor West, NDP): Thank you, Mr. Chair.

    Mr. Conacher, you mentioned in your presentation the revolving door, and we haven't touched on that. I know some would argue that members of Parliament and senior bureaucrats have obtained their knowledge and experience while being reimbursed by the citizens of this country, and that knowledge and experience is to some degree owned by the people because they've paid for that and they've fostered that development.

    Two years and one year were mentioned as potential scenarios. Maybe we could get everybody's opinion in terms of what the year criterion should be. Why not five years, for example? It would seem that with those timeframes you could go on vacation and then you'd be right back in the loop, depending upon when the election is and when things are happening, when maybe there should be more distance.

    Lastly, should there be something related to years of service and duties as requirements in terms of measuring the influence or effectiveness you could have obtained by the reimbursement you received as either a member or a bureaucrat?

    Mr. Duff Conacher: Currently, the conflict of interest in public office-holders code only applies to senior public officials, ministers, and parliamentary secretaries. It doesn't go down through the House of Commons and the Senate, nor through the public service. So in that way it sort of reflects the level of duties, at least, because there's no rule for others.

    A period of five years may not be enough, but at least you'll likely have an election in between, and that can lead to a change and hopefully some turnover in the public service. Also, it should hopefully encourage a lot of the ex-ministers and ex-senior public officials to find some other line of work, which a one- or two-year period doesn't really encourage. It's pretty easy to sit out for that short period and then come back, especially if you have a nice patronage appointment you can just exist on for that time. If you wanted to make it longer, we would agree with that, but we think five years is a reasonable proposal that would help shut down the revolving door somewhat.

    Should this be extended to other public servants? Yes, I think so. I mentioned earlier that the public servants ethics code needs to be strengthened, and it needs some independent enforcement.

    I disagree with Mr. Grainger about the independence of the office of the public integrity officer that's been created. It's not independent enough. It just makes recommendations, in secret, back to senior bureaucrats on problems that whistle-blowers have brought up. It's hardly an effective system.

    You need to have the full independence from the public service that an ethics commissioner would have, and you need to have all rulings made public. Otherwise, it'll be just too easy for things to get hidden and not get cleaned up.

    So extend these rules to the public service more directly, on a sliding scale based on level of duty, and extend the proposed ethics commissioner's duties to cover not only lobbyists but also public servants. Then they'd be enforcing the whole package of laws. You wouldn't have conflicting rulings. You'd have consistency of advice given by an advisory division and of rulings made by the administrative tribunal.

    Just to mention one other thing about that proposed ethics commissioner, we think it should be an ethics commission. Mr. Grainger mentioned that you may not want to trust one person with all these duties. You shouldn't. If you have three to five people on an ethics commission, you're going to also decrease the likelihood of conflicts of interest within that commission itself, or of having one person captured by everyone who is concerned about the wrath they may feel from the Prime Minister or a minister. If you have three to five people, it's going to be pretty difficult to stack it with a bunch of hacks who won't do their jobs and will act as front men, in the same way the ethics counsellor has been acting as a front man for the past eight and a half years.

º  (1655)  

    Mr. Brian Grainger: I would make a couple of points. One is that the difficulty with the three-year, five-year, or twenty-year limit, as I've noticed, is that anyone can slip into a corporation, a law firm, a medical firm, or whatever, and do all the things they need to do under the guise of X, Y, Z corporation except show up in your office or a minister's office. So just putting limits on their ability to appear in your office or in the minister's office is not going to do anything, because right now people can be employed by X, Y, Z, or companies that have been well known to all of you, and sit at a desk and do “research” until the limit expires, and then they'll appear in your office.

    So dealing with it that way does not solve the problem. The problem is only going to be solved when we look at this issue from the point of view of how to prepare people professionally to use some strong values, core values, values judgment in all these relationships, and not assuming that we can create rules and regulations or even, to a degree, three- and five-person commissions or tribunals or court systems within the bureaucracy or within the public office-holder venue in the hope that somehow this new tribunal--call it whatever you want--is going to be any quicker or better than a single “judge”, if I can use that term, doing their thing. There's no evidence to suggest that by putting a bunch of people in an ethics commission tribunal we're going to move this file forward. There certainly isn't any evidence.

    As to the independence, well, I can appreciate that it's difficult to get independence in any job in the public service if you're looking for perfection, but in terms of disclosure, it's well known that there's a balance between confidentiality and what I would describe as not secrecy. Disclosure doesn't happen in an environment, private or public, where the disclosing person or, to use the other word, whistle-blower knows full well that this is all going to be on the front page of the The Globe and Mail or Le Devoir tomorrow, with chapter and verse about himself or herself. That doesn't normally help disclosure, certainly not in more complex and sensitive cases.

    Mr. John Chenier: Post-employment guidelines are a revolving door and have proven to be one of the most difficult aspects of lobbying to implement.

    When the Clinton administration came in, they were concerned about the revolving door. It had been an issue with the Bush administration, and with Reagan before that. They didn't think they had the time or the ability to get a law through Congress, so they had all their people sign civil contracts, and depending on where they were, these civil contracts either banned them from working--so if they were in trade and at a certain level they could never work for a foreign company, ever, or for five years or two years, depending on their level.

    Well, that lasted until Vernon Jordan, I think, who was the first guy to leave. He went right into a lobby firm and essentially, poof, there was the thing, it was gone.

    Post-employment guidelines are there for two reasons, it seems to me: one, it's a cooling-off period. It's to make sure that a file you were working on isn't there when you come back--which I know is very difficult when things bounce around for twenty years. But as well, it's to give public assurance that people aren't necessarily profiting, or profiting immediately. But for them to work, they have to be realistic. Five years is totally unrealistic. You have to tie it to some degree of what these persons are able to influence from outside once they've gone there. So I think two years or six months, depending on the individual, is the maximum.

    The other thing, of course, is how you apply this, and I go to comments from my colleague over here who talks about people just sitting at a desk and doing research for a year or two, and then, bingo, they turn on the tap. I guess my point would be that if these things are realistic but they are also going to be applied, a person can't go to a firm that has any dealings with them. Whether they're going to be associated with their old friends or not, they simply can't go to that firm.

    Of course, where it really is very common and kills everybody is in the military, where you have retired service officers, Canadian and particularly U.S. armed services, who walk out their doors, and the next minute they're working for the company that has been selling goods and services to the military for years.

    I think by and large in Canada we give dispensations too often. Essentially, people will go to the ethics counsellor and he'll give three months' dispensation or say you can go here or you can go there. I think the law should be clear, it should be reasonable, but it should be enforced right across the board, which in any case in the Canadian context has not been followed.

»  (1700)  

    Mr. Brian Masse: To follow up, it gets problematic. I hear from constituents all the time that somebody leaves, goes to a lobby firm, and starts making money. Differentiate this from an early retirement, I guess, where somebody leaves and they're almost hired back by the company, or somebody else, on contract. How do we reconcile this situation, where they're still involved in the line of work they did, either for the same company or a different company?

    Mr. Duff Conacher: Through all of this enforcement system and all of these codes, I think you simply need anti-avoidance, and to follow the spirit of the codes, not just the actual technical line of all of the codes. Otherwise, I'm sorry, but people will say, “That wasn't specifically prohibited”. They'll do it routinely.

    We have a complaint in about John Dossiter, senior policy adviser to Allan Rock when he was the Minister of Health. He is now active on the biotechnology file as the government relations VP for Monsanto. He's not registered as a lobbyist, and he's not violating the post-employment code, according to.... Well we'll see; we're waiting. This is one of the complaints that's over a year and a half old.

    The Chair: Mr. Chenier.

    Mr. John Chenier: I again think this is germane to the Lobbyists Registration Act, where we're talking about post-employment guidelines for people who go to an agency where they are going to influence, or attempt to influence—or where the agency has a stake in the influence of that individual's previous employment—not someone who is going on pension and getting another job, or something like that. We're dealing strictly here with the ability of this person, because of their inside knowledge, to be of value to the firm they're going to. I guess what we're saying is that we should prescribe a different value to different levels, such as six months, eight months, ten months, a year, or whatnot. The restrictions should involve going to a firm that has dealings, and not only in the sense of being associated with those dealings.

    But the restrictions should be reasonable; people have to earn a living. That's reality. Governments are going to be defeated, ministers are going to leave, and ministerial assistants are going to be out in the street. What are we essentially telling them about their employment prospects? I think six months for a ministerial aid is plenty of time.

»  (1705)  

    The Chair: Mr. Grainger, did you have something to say before I go to the next question?

    Mr. Brian Grainger: Yes, because I think the members asked for some response to these points, and also for some other practical suggestions.

    About eight or nine years ago, the Australian national defence forces ran into some very serious problems, which are well documented. If anyone's interested, I'm sure we can provide details of these. They did something rather interesting as a result. Whether it is their own employees or the suppliers to the department, they regularly meet and have documentation provided regularly and frequently to both employees and suppliers—or clients, if you like—which clearly state what corporate people are expected to do and not expected to do. They call them in and have an eyeball-to-eyeball meeting, with none of this stuff, “Read my note on the e-mail”, which you can ignore or pretend you didn't get, or which is so impersonal that you don't care. I'm going back now to Duff's point that if people don't respect the spirit of these things, these things won't happen.

    I would like to commend National Defence. They recently started into this process a bit as well. There's a document they've created that talks about their relations with the private sector and corporations. You might want to take a look at it.

    I think this is really important: people should be hauled in. There are not that many corporations in this country doing big business, the big players Mr. McTeague was mentioning.

    To take this to another level, or another jurisdiction, the committee might wish to have someone take a look at something called the Defense Industry Initiative on Ethics and Conduct--dii.org--which is the single oldest evaluated ethics club of corporations available. It is independently evaluated—and not by Arthur Andersen. They clearly did not, fortunately.

    Take a look at this. You'll see in there these efforts at the practical level. Haul people in and say to them, “This is our professional obligation on this side of the equation, and this is yours on that side of the equation. Do you understand the point?” And then tell them the consequences: “We told you six months ago not to do that. You did it. Well, you're off the supply list. We don't do business with you.” That's what the Australians have done: “We don't do business with you.” That's a bigger hammer than every piece of paragraphing we can put into any one of our pieces of legislation: “We don't do business with you; that's it, you're off the list.”

    The Chair: Thank you very much.

    Mr. Fitzpatrick.

    Mr. Brian Fitzpatrick (Prince Albert, Canadian Alliance): I'm certainly not as familiar with this stuff as any of the gentlemen at the front, but in listening to what I've been hearing and to what Mr. McTeague mentioned and so on, there's a bit of caution I would throw out.

    There are 30 million Canadians in this country, and each in their own way may want to influence government policy at different times. I remember not too many years ago that somebody said there really weren't very many firearms in Canada, that it would be a very simple process to start registering them, that it would be easy for people to deal with it, and so on. I don't want to get involved in that debate, but I would say it became a lot more complicated than everybody thought it would be.

    When I think of the Income Tax Act, it seems to me that it has been one game after another in which somebody has said the government should do something about something. The Income Tax Act has gotten more and more complicated, and guess who eventually benefits from a more complicated Income Tax Act? It's the wealthy and the powerful who can hire Arthur Andersen and figure out strategies to get around it.

    If I've heard him correctly, I think Mr. Grainger has said to keep it simple and not put up walls and barriers for people to deal with their government. I guess that would be my sentiment with it. I'm a lawyer. As soon as you start mentioning disclosure, it opens up a can of worms that never ends. It's not just a simple matter. All they have to do is disclose something and....

    I'm going to raise another comment here. I presume this bill does not deal with it, but if I'm a person who really wants some big-time influence over government, I'm not going to waste my time lobbying individual MPs, cabinet ministers, or some government department. I'm going to go directly into the political party process, through donations and other things, to do my business to get what I want. I'm presuming this bill does not have anything to do with that dimension, or leadership campaigns, as far as they go. I could get involved in a leadership campaign and put a whole bunch of money on the plate.

    Does this bill deal with any of those sorts of considerations?

»  (1710)  

    Mr. Duff Conacher: No, what has been promised in—

    The Chair: Mr. Conacher, I need to recognize you so that it goes on the tape. I was going to recognize Mr. Chenier first, and then just go across the table.

    Mr. John Chenier: Even with those things, if that were indeed the way to donate to campaigns and the like, you would still have to articulate what it is you want for your money afterwards. That's where your lobbyist or someone else would come in and say, “Here's what we want, here's what we're after, and here's the law we would want.” Now, this is a question like, “When did you stop beating your wife?”

    I'm not suggesting that is what happens. What I'm saying is that I think the campaign donation, whether it's a leadership campaign or otherwise, is one thing. Organized lobbying is much bigger than any money we spend on elections in a given year. The amount of money spent on lobbying in Ottawa in a year is about $300 million. We don't spend that much in a general election.

    Mr. Brian Fitzpatrick: So far.

    Mr. John Chenier: So far. Right.

    So if we're talking about how much we're spending to influence an issue by campaign financing or leadership financing, versus how much we spend on an ongoing basis in an advocacy attempt to influence policy, the two don't even—

    Mr. Brian Fitzpatrick: The only point I would make from my own experience, after having been here for only two years, is that I've run into a lot of lobbyists on different issues, and all they're trying to do is inform me of their position. Quite honestly, I can't think of anybody who I would say has had a sinister objective.

    Mr. John Chenier: Lobbying is not sinister, sir. We recognize that the preamble of the act says lobbying is perfectly legitimate and legal. What we're trying to do is tell the people of Canada who is being paid to attempt to influence the policy.

    The Chair: Mr. Conacher.

    Mr. Duff Conacher: Changes to the political finance system were also promised in the so-called ethics package released by the Prime Minister in June. What has been more recently promised is that there will be changes to the Canada Elections Act, and possibly a new law to cover leadership campaigns and donations to riding associations, to MPs directly, and to parties, and that it will be introduced in the form of a bill before the break for the holidays, in less than a month.

    So that will hopefully be addressed in another bill. Whether it will be passed or not, and whether the changes to the whole ethics counsellor system and the code of conduct for MPs and senators will be passed or not, remains to be seen. All of it was promised back in 1993, but we're still waiting fully nine years later.

    The Chair: Mr. Fitzpatrick.

    Mr. Brian Fitzpatrick: I must confess I haven't read all of the details of this bill. Maybe the individuals could help me out on it.

    There are organizations out there that I think receive substantially all of their income from government, and they seem to spend virtually all their time lobbying the government, maybe for money, and also to influence their point of view. Does this bill deal with that kind of issue?

    The second question is, is there any ethical question surrounding that sort of arrangement where somebody receives almost all of their funding from government and they spend virtually all of their time lobbying government for something?

    The Chair: Mr. Grainger.

    Mr. Brian Grainger: That's a very interesting question. I think, in theory, this legislation and previous legislation is trying to shed light on as many people who are trying to influence government, particularly in a paid way--they're paying and spending money to achieve this. There's no doubt government will give money to persons or organizations who perhaps don't have a voice and it's viewed that they need a voice. That voice is underwritten, if you will, if that's the right word, by public funds.

    I think there are many good reasons and good causes, if I can for a moment editorialize, that would fit into that, whether it's around issues like access to justice and some of our more marginalized, if I can use that term, or less privileged members of our communities and our societies. I think there's a legitimate role for that.

    It seems to be done whether we're talking about the G-7 or we're talking about OECD, which is about 30 countries in what we describe as the stronger economies. That seems to be par for the course. It doesn't seem to be out of line with what our neighbours and others are doing. I don't see it, personally, as a conflict of interest.

    The degree to which some of these organizations are as transparent as John and Duff, or I or you, might want is part of, as I said, the objective of this legislation. How much should we know, and when should we know it, about their activities, if they're meant to be...and they're spending a lot of money, if you like, on these activities. But in and of itself, given my experience around the ethics file, I don't think that's a conflict of interest.

    Who influences whom in terms of why the money might have been given? That could happen anywhere, anytime. If someone in a position of power chooses to give his or her friends money for some purposes that are not really above board, that's definitely going to be a conflict of interest. What I would suggest here is that this is not the general drill, or the general effect or process, that you're describing, if I may say so, with respect.

»  (1715)  

    The Chair: Mr. Conacher, were you going to comment on it?

    Mr. Duff Conacher: Yes. First of all, the current law does require that when you register as a lobbyist you have to disclose the amount of government funding you've received as part of your registration.

    I was not thinking so much of citizen groups as I thought you we're talking about Bombardier and Pratt--

    Mr. Brian Fitzpatrick: I was thinking of anti-smoking organizations.

    Mr. Duff Conacher: Yes. I was thinking of Bombardier more, and Pratt & Whitney, and Nortel actually, if you're talking about those who are getting and relying on government for money. I think your concern should really be more about looking at something like the technology partnerships fund, where all sorts of--

    Mr. Brian Fitzpatrick: I'm including them too.

    Mr. Duff Conacher: --job guarantees are made.

    Overall there is a better way for both corporations and citizen groups, for government to hand out money, and that is to be handing it out on the merits, and based on representation and based on getting something in return and ensuring that it happens. It doesn't happen enough on either the citizen group side or the corporation side right now, and there is a big problem.

    If anyone is going to be supported to lobby, it should be citizen groups because they are at a disadvantage. Corporations like banks can easily add a nickel here, a dime there, a loonie or a toonie, to their service charges and shift all of that money into their lobbying. Who's paying for it? The customers, not the banks. Canadian citizens pay for all the corporate lobbying and advertising that goes on now. They deserve a leg up in a lot of cases.

    But there's a better way than just direct government funding, and we've proposed it. There's lots of information on our website. It's called our Citizen Association Campaign, if you're interested in looking at it, a no-cost way for government to facilitate citizen watchdog groups.

    The Chair: Mr. Chenier is next, and then I have to go to Ms. Gallant.

    Mr. John Chenier: As Duff pointed out, when you register you have to declare how government funding is involved with your organization or with the application. Again, as Duff has mentioned, if you believe in some degree of corporate taxes and you recognize that lobbying expenditures are tax deductible, then essentially whatever the corporate tax rate is, that's how much the public is paying to allow these corporations, or anybody else for that matter, to lobby.

    But more to the point, as to whether or not government should pay people to sort of mobilize public opinion, I was interviewing one of your colleagues and a few others for an article I was doing on lobbying MPs, and the first thing this person said was, “The lobbyist has to show me there's public support for this. If there's no public support, I don't go to bat for it.” Quite often, she said, when there is a need to mobilize public support for the public good, she feels the government should be allowed to educate and mobilize people through groups.

    Take smoking, for example. If we believe that smoking is bad for your health, should we not fund groups to educate us on that score? If they educate us, what should they do? They should probably lobby governments to pass laws that make it hard to sell cigarettes to children or that make advertising around schools difficult to do, or whatnot. Without public support to do this, she says the government can't act. So for government to go out there, educate people, and drum up that support to pressure them to act is a necessary function, from her perspective. I just leave that with you.

»  (1720)  

    The Chair: Go ahead, Mr. Fitzpatrick. You're sharing your time with Ms. Gallant.

    Mr. Brian Fitzpatrick: I'm not going to disagree with your comments on the smoking thing, but when you start getting into hundreds of organizations, and then you get into the francophones of Alberta against smoking, there is a question of how far you're going to go with this stuff to get your message through. On the other hand, other organizations and groups that feel they have legitimate interests are arbitrarily told, for whatever reason, they're out of the loop. You could almost divide it on a philosophical or ideological basis. There are problems with that too.

    Once you get into this area, there are lots of problems. There are lots of questions of remoteness too. You almost think sometimes that the organization is there for itself. It's a paycheque for somebody more than a campaign. They might show up in school once a year to say, “Smoking's not good for you,” and show up in Ottawa and lobby a few days.

    Mr. John Chenier: I think smoking's a bad example, because all the people I know working on that are working very hard.

    The Chair: Thank you, Mr. Fitzpatrick.

    I'm going to give each of the witnesses a chance to make some final comments, if they wish.

    Mr. Chenier, would you like to make some final comments?

    Mr. John Chenier: I have no final comments.

    The Chair: Thank you very much.

    Mr. Conacher.

    Mr. Duff Conacher: I'm fine, thank you again.

    The Chair: Mr. Grainger.

    Mr. Brian Grainger: Thank you.

    The Chair: I'd like to thank the witnesses on behalf of the committee for your very valuable input. It's not an easy subject, and I'm sure we're going to get a lot of variations, but your input today has been excellent and I want to thank you for that.

    The meeting is adjourned.