[Democracy Watch Logo][Op-ed]

Federal Liberals' Lobbying Scandal is 11 Years Old -- 
Reveals how the glacially slow-changing, still fatally flawed government accountability system is the real scandal

(The following opinion piece by Duff Conacher, Coordinator of Democracy Watch, was published in edited form in the Hill Times on October 24, 2005)

Many federal government observers are claiming that the recent scandals involving highly questionable activities by Liberal government-connected lobbyists David Dingwall, Richard Mahoney, John Duffy and others have revealed cracks in the federal lobbying regulation law system.

In fact, the cracks in the Lobbyists Registration Act, the Lobbyists' Code of Conduct, and the enforcement system, have been well-known for more than a decade -- the real scandal is how such a completely ineffective, sham system has rolled along for years and is still fatally flawed.

As I write this, on October 20, 2005, I am thinking back to October 20, 1994 when I testified on behalf of Democracy Watch before the House of Commons Subcommittee about the amendments to the federal Lobbyists Registration Act proposed in Bill C-43.

Already the new Liberal Cabinet had broken its 1993 Red Book platform promise to appoint an "independent" ethics watchdog with "the power to investigate complaints" when it established an Ethics Counsellor who was completely under the control of then-Prime Minister Jean Chrétien, and who had no powers to investigate or penalize wrongdoers.

That promise was one of many set out in the key "Governing with Integrity" chapter of the Red Book, and the fact that the Liberals' broke it only seven months after being elected sent the clear message that there was little hope that they would keep Chrétien's promises to "force lobbying out from the shadows into the open" and ban "contingency fees in lobbyists contracts," let alone his promise that no one would need a lobbyist to meet with a Cabinet minister in his government.

The proposals made to that Subcommittee by Democracy Watch and other witnesses set out an effective lobbying system that, if implemented in 1995, would have prevented the past decade of corrupt activities by not only lobbyists, but also by Cabinet ministers, senators, and MPs.

What should have happened, what did happen, and who is responsible is an all-too-typical tale of dishonesty and greed undermining good governance and the public interest.

First, the Liberal Cabinet and then-Industry Minister Allan Rock did not include in Bill C-43 Democracy Watch's proposed requirement that Cabinet ministers and other decision-making public officials regularly disclose on an searchable Internet site the identity of anyone who communicates with them in any way about any decision or proposal (which would have effectively tracked and exposed almost all lobbying efforts in detail over the past 10 years).

Instead, the Bill continued to require only some, paid lobbyists to disclose vague information about whom they were lobbying on what issues, allowing most corporate lobbyists to lobby in secret (a huge loophole that continues today).

Second, the Cabinet did not include Democracy Watch's proposed requirements that lobbyists disclose their past and current work with candidates, parties, politicians and governments (still today, only past work with the federal government is disclosed), and that lobbyists' other political activities (including donations) be restricted.

These loopholes allowed several lobbyists to work in secret for years for the Liberal Party leadership and election campaigns of Cabinet ministers they were also lobbying such as Rock, Paul Martin, John Manley and Sheila Copps.

For example, the Earnscliffe Strategy Group had people such as David Herle working on multi-million dollar contracts as inside advisors to Finance Minister Martin while Earnscliffe lobbyists such as Michael Robinson represented powerful corporate clients who wanted favourable decisions from Martin while both Herle and Robinson worked on Martin's campaigns (and were able to donate their time because of how much they were earning as consultants and lobbyists).

Fourth, Bill C-43 did not include Democracy Watch's proposal that the 1-2 year ethics code ban on Minister's and their staff and other senior public officials becoming lobbyists after they leave government be put in the law and increased to 3-5 years.  The past decade has been a revolving door of public officials becoming lobbyists becoming public officials, often in clear violation of the too-short cooling-off period.

Fourth, the Liberals' ensured that the 1994 Bill did not include Democracy Watch's proposal that lobbyists be required to disclose how much they spend on each lobbying campaign.  As a result, the public still lacks key information needed to determine whether the government is making policy decisions based on the merits of the arguments of stakeholders, or the size of the lobbyist's wallets.

Fifth, the 1994 Bill did not include Democracy Watch's proposal to prohibit lobbyists from being paid "success" or contingency fees (and still today, such corruption-encouraging fees are only banned by a poorly enforced government policy, and only when lobbying for contracts or grants).

Enforcement was the final fatal flaw not corrected by Bill C-43.  Still today the enforcement of the lobbying Act and Lobbyists' Code is completely ineffective because the enforcer (now the Registrar of Lobbyists) has always been completely under the control of the Industry Minister.

The rules of the Cabinet minister, ministerial staff and Cabinet appointees' ethics code and the new MPs Code are similarly loophole-filled, and the enforcement of these codes (while more independent since the Ethics Commissioner position was created in May 2004) also remains largely ineffective (which is why Democracy Watch has recently launched a challenge in court of both the Registrar of Lobbyists and the Ethics Commissioner).

Incredibly, Diane Champagne-Paul, the Registrar through the 2000-2003 period in which former Liberal Cabinet minister-turned lobbyist David Dingwall and other lobbyists were violating Industry Canada's Technology Partnerships Canada (TPC) fund policy against "success" fees, is still in an ethics enforcement position as the Director of the MP Code for the current Ethics Commissioner Bernard Shapiro.

Champagne-Paul and former Ethics Counsellor Howard Wilson failed to catch and prevent Dingwall from entering into illegal fee arrangements even though Dingwall admitted in his lobbying registration (which both had the responsibility to review) that he was in such an arrangement.

And still today there are no mandatory penalties such as high fines for violating the Lobbyists' Code, nor for violating the Cabinet or MP codes.

Current Industry Minister David Emerson, while cornered into taking action on the TPC lobbying success fee arrangements, has so far been too vague and secretive about enforcement actions and penalties.  He has also tried to protect the lobbyists by claiming that no one can be charged under the law because the 2-year limitation period has passed (even though the law can clearly be read as stating that the limit on laying charges only starts ticking when the violation is discovered (which only happened last year) not when it occurred).

Through the 2-year lobbying rules review that led to Bill C-15 being passed by Parliament in June 2003, the loopholes in the lobbying regulation system continued to be largely ignored by the federal Liberal Cabinet.  In fact, in part because Bill C-15 tightened a couple of the holes a bit, Chrétien and then Martin delayed implementation of the Bill's measures until June 2005.  (and if Democracy Watch hadn't blown the whistle on the delay in November 2004, Bill C-15 would probably still not be in force).  The loopholes were also not closed by Bill C-4 (passed in May 2004).

By refusing to close these gaping loopholes in the federal lobbying regulation system while claiming that they have closed them, both Jean Chrétien and Paul Martin's Cabinets have violated their own ethics rules requiring them to develop policies "in the public interest and with regard to on the merits" and "to act with honesty and uphold the highest ethical standards so that public confidence and trust in the integrity, impartiality and objectivity of government are conserved and enhanced."

Did Liberal MPs stand up to the Cabinet and amend Bill C-43 or C-15 or C-4 as they could have to close these loopholes.  Only a few have ever spoken up, while most have applauded the Cabinet's negligence or just kept quiet.  For example, then-Liberal MP Paul Zed inaccurately claimed the 1994 Bill set a world standard for lobbying regulations (Zed went on to become a lobbyist after being defeated in the 1997 election, and then returned through the revolving door to become a Liberal MP again in 2004).

Through the 1997-2000 period when the Liberals had a slim majority, and through the past 16 months when the Liberals have been in a minority government, still Liberal MPs are doing little to force their Cabinet to make the lobbying regulation system effective.

The opposition parties have not done much better, preferring to criticize the Liberals as opposed to pushing comprehensive, effective clean-up measures through Parliament by working together strategically (especially in the minority government situation of the past year).

As for the Senate, too many senators have been tied to corporations in one way or another and therefore drunk on the power they enjoy as inside government lobbyists for these corporations to have a sober second thought about cleaning up the lobbying system.  They revealed their true colours when they finally passed an ethics code for themselves in May full of loopholes and with the Senate Ethics Officer completely under the control of a committee of senators.

Of course, the most powerful lobbyists in Ottawa, members of the misleadingly named Government Relations Institute of Canada (GRIC - it is a lobby group, not an institute), have been lobbying against stricter lobbying rules every step of the way.

And while the media has dedicated pages of print and hours of broadcasts spelling out the details of each scandal, many media outlets continue to gloss over the fatal flaws in the system that are the root causes of the scandals.

Imagine how the mayor and his staff and their friends would act in a city in which they (and they alone) could drive through any red light or stop sign (or turn them into green lights whenever they wanted), and the police were hand-picked by and under the control of the mayor, and the penalties were weak or non-existent, and opposition politicians and the local media focused on the accidents that (of course) happened but not the causes.

The chaos and damage the mayor and his cronies would create over a decade with their reckless driving is similar to the harmful mess the federal Liberals' have created in their past 12 years of controlling the federal government.

So no one should be surprised by the scandals caused by dishonest, unethical, secretive and wasteful actions by Liberals and their cronies, nor by the crisis-level problems in so many key areas of Canadian society such as health care, environmental protection, social welfare, overall corporate responsibility, and transportation.

When the system is the scandal, scandalous behaviour is encouraged.  When no effective good governance system exists, the government will do no good.  As the Supreme Court of Canada stated in a 1996 ruling, "codes of conduct which, for an ordinary person, would be quite severe" to comply with are needed for Canadian politicians and bureaucrats so that they will consistently use their powers responsibly.

In other words, any government allowed to be occupied and driven by secret, behind-closed-doors, "I'll scratch your back, you scratch mine" deals with powerful corporate lobbyists won't have the time, nor the political will, to uphold the public interest and solve society's problems.

While we are moving closer to cleaning up the system, the past decade has shown clearly that three things need to happen at once in order to have the key accountability measures passed and enforced that will break this cycle of federal government corruption that is largely driven by lobbyists.

A critical mass of federal political party leaders and politicians must make iron-clad, detailed promises to clean things up.  The media and the public have to demand that politicians promise in writing to resign if they don't keep their promises.  And the courts have to require the promises to be upheld when making decisions on challenges to inaction or broken promises.

When these three things happen, Canadians will finally get the honest, ethical, open, representative and waste-preventing federal government they need, and deserve.

Duff Conacher, Coordinator of Democracy Watch
Tel: (613) 241-5179

Democracy Watch's Government Ethics Campaign

Democracy Watch homepage