Thursday, September 26, 2002

OTTAWA - Today, Democracy Watch filed an open letter with Ethics Counsellor Howard Wilson requesting that he investigate and determine whether lobbyists who paid to gain access to federal Cabinet Ministers and ministerial staff broke ethics rules for lobbyists (Please see letter set out below).

On August 19th, the federal Liberal Party held a charitable golf tournament in Chicoutimi as part of its annual caucus meeting. According to media reports, as part of the benefits for participants in the tournament, $2,500 gave the participant the privilege of golfing with a Cabinet minister, and for $1,500 participants were given the privilege of golfing with the staff person of a Cabinet minister.

According to media reports, more than 140 people signed up for the tournament, including representatives of Air Canada, Bank of Nova Scotia, the Canadian Bankers Association, and the Insurance Brokers Association of Canada, all of which are registered to lobby the federal government.

Bell Canada and the Royal Bank sponsored the tournament, and Democracy Watch is also requesting the Ethics Counsellor to determine whether these two corporations, both of which are registered to lobby the federal government, violated ethics rules for lobbyists by partnering with the Liberal Party in holding the tournament.

"Paying money to gain access to Cabinet ministers is not only unethical, it is also undemocratic," said Duff Conacher, Coordinator of Democracy Watch. "We believe the ethics rules for politicians and lobbyists clearly prohibit such access-for-cash schemes."

Rule 8 of the Lobbyists' Code of Conduct states that: "Lobbyists shall not place public office holders in a conflict of interest by proposing or undertaking any action that would constitute an improper influence on a public office holder". Among other rules, part I, sub-section 3(1) of the Conflict of Interest and Post-Employment Code for Public Office Holders (the Public Office Holders Code) states that public office holders must "arrange their private affairs in a manner that will bear the closest public scrutiny, an obligation that is not fully discharged by simply acting within the law" and subsection 3(5) states that they "shall arrange their private affairs in a manner that will prevent real, potential or apparent conflicts of interest from arising . . ."

As a result of these rules, Democracy Watch believes that federal politicians cannot sell access to themselves, nor can federally registered lobbyists buy access to federal politicians.

"Lobbyists represent private interests, but politicians are supposed to uphold the public interest," said Duff Conacher, Coordinator of Democracy Watch. "Any activities which tie lobbyists and politicians together are not only unethical, but also threaten the protection of the public interest."

Democracy Watch is filing the complaint with federal Ethics Counsellor Howard Wilson despite the fact that it believes that Wilson is biased in his legal position as enforcer of the Lobbyists' Code of Conduct because Wilson also holds the separate legal position of compliance officer for the Public Office Holders Code (a position completely controlled by the Prime Minister). As a result of the Prime Minister's control of Wilson in his one position, Democracy Watch believes that Wilson cannot in his other position fairly and impartially uphold the Lobbyists' Code. Democracy Watch filed an application in Federal Court last December challenging a past ruling of the Ethics Counsellor and the legality of Wilson holding both positions. The case is proceeding through the Federal Court.

Howard Wilson
Ethics Counsellor
66 Slater St., 22nd Floor
Ottawa, Canada
K1A 0C9
Fax: (613) 995-7308

September 26, 2002

Dear Mr. Wilson:

Democracy Watch is filing this letter to request that you, in your legal position as enforcer of the federal Lobbyists' Code of Conduct (the Lobbyists' Code), investigate situations that Democracy Watch believes raise serious questions concerning violations of the federal Lobbyists' Code.

Democracy Watch believes that you personally are biased in fulfilling the role of enforcing the Lobbyists' Code because you also hold the separate legal position of compliance officer for the Conflict of Interest and Post-Employment Code for Public Office Holders (the Public Office Holders Code), a position completely controlled by the Prime Minister. As a result of the Prime Minister's control of you in this position, Democracy Watch believes that you personally cannot fairly and impartially uphold the Lobbyists' Code. As you know, Democracy Watch has filed an application in Federal Court challenging, among other things, the legality of you holding both these positions.

However, Democracy Watch is still filing this letter without prejudice to that court application because it believes that, if you are replaced by another person in the legal position of enforcer of the Lobbyists' Code, the position has sufficient independence and powers to fairly and impartially uphold the Lobbyists' Code as set out in sections 10.1 to 10.5 of the federal Lobbyists Registration Act, CHAPTER L-12.4 (R.S., 1985, c. 44 (4th Supp.)) (the Act).

As you know, the Lobbyists' Code covers all lobbyists required to register under the Act. On August 19th, the federal Liberal Party held a charitable golf tournament in Chicoutimi as part of its annual caucus meeting. According to media reports, as part of the benefits for participants in the tournament, $2,500 gave the participant the privilege of golfing with a Cabinet minister, and for $1,500 participants were given the privilege of golfing with the staff person of a Cabinet minister.

According to media reports, more than 140 people signed up for the tournament, including representatives of Air Canada, Bank of Nova Scotia, the Canadian Bankers Association, and the Insurance Brokers Association of Canada, all of which are registered to lobby the federal government.

In addition, Bell Canada and the Royal Bank sponsored the tournament, both of which are registered to lobby the federal government.

Principles set out in the Lobbyists' Code require that all lobbyists follow "not only the letter but the spirit" of the Lobbyists' Code and all relevant laws, including the registration requirements of the Lobbyists Registration Act, and that lobbyists conduct all their relations with " integrity and honesty" and "observe the highest professional and ethical standards."

In addition, Rule 8 of the Lobbyists' Code states the following:
"8. Improper influence
Lobbyists shall not place public office holders in a conflict of interest by proposing or undertaking any action that would constitute an improper influence on a public office holder."

The Act defines public office holders as including all members of the House of Commons and the Senate (subsection 2(1)).

The Public Office Holders' Code requires ministers, ministerial staff, and others covered by the Code to adhere to the following rules (NOTE: "Every public office holder" (including, Democracy Watch believes, all members of the House of Commons and the Senate) is required to conform with the principles set out under Part I, section 3 of the Code, while only specific public office holders (defined in section 4 of the Code) are required to adhere to the other rules contained in the Code):

• under Part I, sub-section 3(1), " to uphold the highest ethical standards so that public confidence and trust in the integrity, objectivity and impartiality of government are conserved and maintained."
• under Part I, sub-section 3(2), "to perform their official duties ... in a manner that will bear the closest public scrutiny, an obligation that is not fully discharged by simply acting within the law."
• under Part I, sub-section 3(5), "to arrange their private affairs in a manner that will prevent real, potential or apparent conflicts of interest from arising but if such a conflict does arise between the private interests of a public office holder and the office duties and responsibilities of that public office holder, the conflict shall be resolved in favour of the public interest."
• under Part II, subsection 23(1), to "take care to avoid being placed or the appearance of being placed under an obligation to any person or organization, or the representative of a person or organization, that might profit from special consideration on the part of the office holder."

Democracy Watch believes that a reasonable interpretation and application of these rules in the Lobbyists' Code and the Public Office Holders Code, along with a reasonable interpretation of the common law standard for finding that a public office holder is in a "conflict of interest", would result in the conclusion that any lobbyist who paid the fees at the Liberal Party's golf tournament to play with a Cabinet Minister or ministerial staff person, violated Rule 8 of the Lobbyists' Code. Democracy Watch also believes that it is reasonable to conclude that by co-sponsoring the tournament with the Liberal Party, Bell Canada and the Royal Bank also violated Rule 8 of the Lobbyists' Code.

Democracy Watch believes the ethics rules for politicians and lobbyists clearly prohibit such access-for-cash schemes and co-sponsorship arrangements between the governing party and private corporations.

In your legal position as Ethics Counsellor enforcing the Lobbyists' Code, you are required under the Lobbyists Registration Act to investigate if you have a reasonable belief that a violation of the Lobbyists' Code has occurred. You have the full powers of a judge in your investigation (including the power to subpoena witnesses and compel evidence), and you are required to report your ruling to Parliament (via the Registrar General of Canada).

We believe that a full and detailed investigation, using all of the investigative powers of the Ethics Counsellor under the Act, is justified and needed to determine which lobbyists paid the fee at the Liberal Party golf game that gave them access to a Cabinet Minister or ministerial staff person, and to determine whether the lobbyists who paid this fee have violated Rule 8 of the Lobbyists' Code.

We therefore request that you use your full powers under the Act to investigate these situations, to determine if any of the lobbyists have violated Rule 8 of the Lobbyists' Code, and to report your rulings on these lobbyists to Parliament, as you are legally required to do.

The standard for evaluating activities of public office holders under the Public Office Holders Code is whether "real, potential or apparent conflicts of interest" have been created (emphasis added). This standard creates an affirmative obligation on all public office holders to avoid even potential or apparent conflicts of interest.

We look forward to your investigation of this matter, and await your reply.

Sincerely,
Duff Conacher, Coordinator
On behalf of the Board of Directors of Democracy Watch