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Rights + Justice

Foreign Control of Our Officials? Fix Political Funding

Time to ban secret, unethical donations and lobbying across Canada.

Duff Conacher 23 Jun

Duff Conacher is Coordinator of Democracy Watch.

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Cut the strings by closing loopholes.

The disclosure by CSIS Director Richard Fadden that several Canadian government politicians and officials are under the influence of foreign governments is a wake-up call long overdue. It's time for all political parties across Canada to ban secret donations and secret lobbying and strengthen other ethical government rules and enforcement systems.

In his recent report on the Mulroney-Schreiber scandal, while he had a limited mandate, Justice Jeffrey Oliphant recommended closing only a few of the dozens of loopholes in federal government ethics rules, and correcting only a few of the many flaws in the enforcement system, that allow Cabinet ministers and others in federal politics act unethically.

All provinces, territories and municipalities in Canada have weaker rules and enforcement than the federal government.

Secret, unethical political donations and government lobbying are legal across Canada, as are blatant conflicts of interest, and no enforcement agency conducts audits to ensure compliance with the weak ethics rules that do exist, making it easy for anyone, including foreign governments, to corrupt any politician or government official in any government in the country.

Across Canada, unlimited donations to nomination and party leadership race candidates (and in some cases also to election candidates) are legal and are not required to be disclosed (as long as the candidates don't use the donations for their campaigns). 

Also, at the federal level, because of loopholes MPs have kept in their ethics code, volunteer services to MPs by lobbyists is legal, and unlimited travel by MPs and Senators that is sponsored by lobbyists is also legal (although it is required to be disclosed).

While the federal government and six provinces have lobbying disclosure laws, the laws have loopholes that allow for secret lobbying communications by even registered lobbyists, and for secret lobbying by representatives of foreign governments, part-time corporate lobbyists and anyone who arranges not to be paid specifically for their lobbying services.

As well, access-to-information laws across Canada are full of loopholes, and most enforcement agencies don't have the power to order the release of documents even if it is in the public interest.

Politicians and government officials across Canada are allowed to debate and vote on decisions in which they have a financial interest as long as the decision is about a general matter that applies to a broad group of people (99 per cent of decisions made by politicians are about general matters, so ethics rules actually only apply to decisions about handing out government contracts).

None of the ethics, lobbying or elections commissioners across Canada conduct audits to ensure even the currently weak rules are being followed, all have weak enforcement records, and suspicious financial transactions involving politicians and senior government officials are not required to be tracked (in violation of the UN Convention Against Corruption which Canada has ratified).

The four loopholes in rules that apply to Cabinet ministers and full-time senior government officials that Justice Oliphant recommended closing are as follows:

  1. 1. The definition of "conflict of interest" in the Conflict of Interest Act should be expanded to cover "apparent" conflicts of interest;
  2. 2. The definition of "employment" in the Act should be expanded to include contracts so that ministers and senior government officials are required to disclose offers of contracts while they are in office;
  3. 3. The definition of "offer of employment" in the Act should be expanded to include any type of offer so that all offers are disclosed, and;
  4. 4. The restrictions on activities that apply to activities after they leave office should apply to activities outside of Canada.

The 20 loopholes in federal ethics and openness rules that Justice Oliphant did not address (and that also exist in most provincial, territorial and municipal rules) are as follows:

  1. 1. Everyone in government can lie to voters about almost anything with no penalty in many cases (For more details, go to Democracy Watch's Honesty in Politics Campaign);
  2. 2. Cabinet ministers, their staff, and Cabinet appointees (including deputy ministers) and MPs and Senators can make policy decisions in areas in which they have financial interests;
  3. 3. Lobbyists can work for Cabinet ministers part-time;
  4. 4. Lobbyists can work for all MPs (including opposition party leaders);
  5. 5. Some Cabinet appointees don’t have any ethics rules (For more details about #2 - 5, go to Democracy Watch's Government Ethics Campaign);
  6. 6. Documents the public has a clear right to see can be hidden for years, or for decades (For more details, go to Democracy Watch's Open Government Campaign);
  7. 7. Part-time lobbyists for for-profit corporations, and unpaid lobbyists, can lobby in secret, and not all lobbying communications by registered lobbyists is required to be disclosed;
  8. 8. Part-time and junior ministerial staff and “employment exchange program” staff can lobby their Minister the day after they leave;
  9. 9. Staff of MPs and Senators don't have any ethics rules;
  10. 10. Cabinet ministers, their staff, and Cabinet appointees (including deputy ministers) can leave and lobby part-time the next day (with only a few restrictions on who they can lobby);
  11. 11. MPs, Senators and their staff can lobby the government and their former colleagues the day after they leave;
  12. 12. A lobbyist can become a Cabinet minister responsible for the issues they lobbied about very soon after they are elected;
  13. 13. Cabinet ministers can lobby anyone part-time two years after they leave;
  14. 14. All Ministerial staff and Cabinet appointees (including Deputy Ministers) can lobby anyone part-time one year after they leave;
  15. 15. All of the above loopholes also exist in some form for all public servants;
  16. 16. Lobbyists can give MPs and Senators the gift of unlimited “sponsored travel” (For more details about #7 - 16, go to Democracy Watch's Government Ethics Campaign);
  17. 17. Anyone can give an unlimited secret gift of money, property or services to any nomination race or non-MP political party leadership candidate (and they do so based on the principles of the science of influence and persuasion -- for more details, click here);
  18. 18. Political parties and riding associations can maintain secret trust funds for defeated or retiring MPs, and any senator or political staffperson;
  19. 19. Anyone can give a secret, unlimited loan to any Cabinet minister, their staff, Cabinet appointee, MP or senator (For more details about #s 17-19, go to Democracy Watch's Money in Politics Campaign);
  20. 20. It seems, because of lack of effective enforcement and/or vague laws, that MPs can be given appointments, money, property or services by other political parties in return for switching parties in between elections (For more details, go to Democracy Watch's Government Ethics Campaign);
  21. 21. The Prime Minister and Cabinet can appoint cronies and party supporters to more than 3,000 positions without any public or merit-based review (For more details, go to Democracy Watch's Voter Rights Campaign).

The 14 flaws in the federal government's ethics and openness enforcement systems that Justice Oliphant recommended correcting are as follows:

  1. 1. Require Cabinet ministers, their full-time senior staff, and Cabinet appointees (including deputy ministers), to report to the Ethics Commissioner about their work activities after they leave office;
  2. 2. Require the Ethics Commissioner to approve any such work activity;
  3. 3. Require the Ethics Commissioner to make approvals of work activity public;
  4. 4. Allow the Ethics Commissioner to make advice that accompanies the approval of work activity public;
  5. 5. Allow a re-consideration of the approval or disapproval of work activity if new developments in the situation occur;
  6. 6. Make it a punishable offence to fail to disclose such work activity;
  7. 7. Allow former public office holders to appeal a conviction for failing to disclose such work activity through a fair and transparent process;
  8. 8. Require MPs to disclose income received in their last two months in office to the Ethics Commissioner to ensure they are not in a conflict of interest;
  9. 9. Require current Cabinet ministers and senior government officials to confirm with the Ethics Commissioner that former public office holders they deal with are complying with ethics rules;
  10. 10. Make it a violation of a contract with the federal government if a former public office holder wins the contract while in violation of ethics rules;
  11. 11. The Ethics Commissioner should define "direct and significant officials dealings" in the Conflict of Interest Act so that Cabinet ministers and other senior government officials know who they cannot work with during their cooling-off period;
  12. 12. The Ethics Commissioner should define many other vague words and phrases in the Act, and also make public summaries of the currently secret advice and rulings she gives, and has given in the past, to public office holders (NOTE: The Senate Ethics Officer includes such summaries in his annual report);
  13. 13. All federal politicians and their staff should participate in ethics training conducted by the Ethics Commissioner;
  14. 14. All federal politicians and others covered by the Act or MPs Code should meet once each year with a staff person of the Ethics Commissioner to review their possible conflicts of interest.

The 10 flaws in the federal enforcement system that Justice Oliphant did not address (and that also exist in most provincial, territorial and municipal enforcement systems) are as follows:

  1. 1. The Ethics Commissioner and Senate Ethics Officer ignore complaints about general unethical behaviour and conflicts of interest, and can refuse to rule on any complaints filed by the public;
  2. 2. The Ethics Commissioner and the Senate Ethics Officer do not audit anyone covered by federal ethics rules (and the bank accounts of Canadian public officials are not tracked for suspicious transactions, as required under the UN Convention Against Corruption);
  3. 3. The Commissioner of Lobbying does not audit anyone covered by the Lobbying Act;
  4. 4. No one effectively enforces any of the rules in the Values and Ethics Code for the Public Service, let alone conducts regular audits;
  5. 5. Because the Ethics Commissioner, Senate Ethics Officer and Elections Canada do not conduct audits, anyone including lobbyists can easily give a Cabinet minister, their staff, a Cabinet appointee (including a deputy minister), an MP or a Senator or their staff, or any public servant money, property or services in secret, as Karlheinz Schreiber gave former Prime Minister Brian Mulroney money and services in secret;
  6. 6. The Senate Ethics Officer has no independence;
  7. 7. There are no penalties for violating many of the conflict of interest and ethics rules;
  8. 8. There are no penalties for violating open government rules, and the Information Commissioner does not have the power to order the release of documents even if it is in the public interest and no one would be harmed;
  9. 9. The approval of opposition party leaders should be required for the appointment of the Ethics Commissioner, Commissioner of Lobbying, Senate Ethics Officer, Public Sector Integrity Commissioner, Information Commissioner, Director of Public Prosecutions and Chief Electoral Officer to make them more independent from the government, and;
  10. 10. Political staff are not protected if they blow the whistle on wrongdoing, and the overall whistleblower protection system is flawed.

Democracy Watch's final submission to the Oliphant Commission details 20 unethical and excessively secret actions and situations that are still legal for Cabinet ministers, their staff, Cabinet appointees (including deputy ministers), MPs, senators, their staff and other public servants, and 10 key flaws in the federal government's ethics and openness enforcement systems.

The final submission echoes the call made in Democracy Watch's initial submission that Commissioner Oliphant make more than 60 comprehensive, detailed and strong recommendations for changes to the federal ethics, lobbying, political finance and open government laws and codes, all aimed at closing the dozens of loopholes in rules and flaws in enforcement so that these dangerously undemocratic actions are effectively prohibited.  [Tyee]

Read more: Rights + Justice, Politics

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