Monday, April 22, 2002

OTTAWA - Today, Democracy Watch charged that many current practices in federal party leadership races violate federal ethics rules introduced by the Liberals in June 1994. Given the lack of independent and effective enforcement of the ethics rules, Democracy Watch called on the federal government to bring party leadership races under the Canada Elections Act.

Practices that go against existing ethics rules include:

• lack of requirements to disclose identities of campaign donors and amount donated before a party leadership vote takes place;
• lack of limits on campaign contributions; and
• lobbyists or government contractors serving in senior campaign positions.

"Federal ethics rules prohibit politicians and ministerial staff from accepting donations or other benefits for a party leadership campaign, or having a lobbyist or government contractor working for them in any way," said Duff Conacher, Coordinator of Democracy Watch.

Rules 20, 21, and 22 of the Conflict of Interest and Post-Employment Code for Public Office Holders (the Public Office Holders Code), among other rules in the Code, allow politicians (especially ministers, secretaries of state and parliamentary secretaries), ministerial staff and other public office holders to accept a gift, hospitality or other benefit only if all of the following conditions are met:

• the total value of all gifts, hospitality or other benefits from any single source is less than $200 over a 12-month period;
• the gift, hospitality or other benefit could not influence the politician in his/her "judgment and performance of official duties and responsibilities" (rule 20);
• it arises out of an activity associated with the performance of his/her "official duties and responsibililities" (rule 21(2));
• it is "within the bounds of propriety, a normal expression of courtesy or protocol or within the normal standards of hospitality" (rule 21(2)(a));
• it does not "bring suspicion on the office holder's objectivity and impartiality" (rule 21(2)(b)); and
• it does not "compromise the integrity of the Government" (rule 21(2)(c)).

Public disclosure of the gift, hospitality or other benefit, the identity of the donor, and the circumstances, is required for anything a public office holder "directly or indirectly receives" that has a value of $200 or more, except for gifts etc. from a family member or close personal friend (rule 22).

"Under existing federal ethics rules, Canadians have a right to know who is bankrolling candidates for the highest offices in the country," said Aaron Freeman, Board Member of Democracy Watch.

Concerning lobbyists working on campaigns, rule 8 of the Lobbyists' Code of Conduct prohibits lobbyists from putting politicians "in a conflict of interest by proposing or undertaking any action that would constitute an improper influence" on the politician.

Among other measures in the Public Office Holders Code that govern relationships with donors, lobbyists and government contractors are rules requiring public office holders to: "uphold the highest ethical standards" (principle 3(1)); "arrange their private affairs in a manner that will prevent real, potential or apparent conflicts of interest" (principle 3(5)); "not solicit or accept transfers of economic benefit" (principle 3(6)); avoid even "the appearance of being placed under an obligation to any person or organization . . . that might profit from special consideration on the part of the office holder" (rule 23(1)).

"A lobbyist or government contractor working for a politician, including on a leadership campaign, creates clear conflicts of interest in violation of federal ethics rules," said Conacher.

A problem with existing federal ethics rules is that they only apply to current public office holders, not to candidates who do not hold office. As a result, public office holders are prohibited from doing some things that non-office holders are allowed to do during a leadership race.

Representatives of the Liberal Party have claimed that their party rules are adequate, but they only require disclosure of the identity of donors and donations made during the official leadership campaign period, with disclosure not required until months after a party leadership vote. While better than the recent Canadian Alliance leadership race, which did not require disclosure of donations or donors, the Liberal rules are still undemocratic and allow for unethical behaviour, especially leading up to a leadership race. There is also inadequate independent enforcement of rules set by parties.

"The only way to ensure politicians are not bought off by private interests is to require them under the Canada Elections Act to disclose all funds they raise for any purpose, with very high penalties for violators of the disclosure rule," said Freeman.

Effective enforcement is a key element of an ethical and democratic system for party leadership races. Political parties lack the independence and investigation powers needed for effective enforcement, as does federal Ethics Counsellor Howard Wilson. As a result, Democracy Watch believes that the new leadership race guidelines developed by the Ethics Counsellor for the approval of the Prime Minister (if and when they are made public), will not reflect the high ethical standard in existing federal ethics rules, nor will they be effectively enforced.

"The only way to have a level playing field for all party leadership candidates, and to ensure ethical and democratic campaigns with independent enforcement, is to set out a high ethical standard for all party leadership races in the Canada Elections Act," said Conacher.