The 2018-2019 Annual Report

Annual Report Conflict of Interest Act

Mario Dion Conflict of Interest and Ethics Commissioner Conflict of Interest and Ethics Commissioner – Annual Report 2018-19, in respect of the CONFLICT OF INTEREST ACT

For additional copies of this document, please contact: Office of the Conflict of Interest and Ethics Commissioner Parliament of Canada 66 Slater Street, 22nd Floor Ottawa, Ontario K1A 0A6 Telephone: 613-995-0721 Fax: 613-995-7308 Email: [email protected]

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This document is available online at the following address: http://ciec-ccie.parl.gc.ca

June 2019

The Honourable George Furey, Q.C. Speaker of the Senate Senate of Canada 2 Rideau Street, Room E64-A Ottawa, Ontario K1A 0A4

Dear Mr. Speaker:

I am pleased to submit to you my report on the performance of my duties and functions under the Conflict of Interest Act in relation to public office holders for the fiscal year ending March 31, 2019, for tabling in the Senate.

This fulfills my obligations under paragraph 90(1)(b) of the Parliament of Canada Act.

Sincerely,

Mario Dion Conflict of Interest and Ethics Commissioner

ciec-ccie.parl.gc.ca PARLIAMENT OF CANADA PARLEMENT DU CANADA @CIEC_CCIE | @CCIE_CIEC 66 Slater Street, 22nd floor 66, rue Slater, 22e étage TEL/TÉL 613.995.0721 Ottawa, Ontario K1A 0A6 Ottawa (Ontario) K1A 0A6 FAX/TÉLÉC 613.995.7308

June 2019

The Honourable Geoff Regan, P.C., M.P. Speaker of the House of Commons House of Commons West Block, Room 233-C Ottawa, Ontario K1A 0A6

Dear Mr. Speaker:

This fulfills my obligations under paragraph 90(1)(b) of the Parliament of Canada Act.

Sincerely,

Mario Dion Conflict of Interest and Ethics Commissioner

02 Our Mission

03 Our Stakeholders

05 Our Achievements

Compliance Direction and Advice Education and Outreach Enforcement Contacts with Parliament Public Communications Collaboration and Best Practices Transparency

20 Our Tools

Our People Our Plan Our Infrastructure

22 Our Challenges

Safeguarding the Public Interest Leveraging New Technology Election Readiness Court Matters

25 Appendices

Financial Resources Summary Our History

COMMISSIONER’S MESSAGE

Having completed my first full fiscal year as importance of Commissioner, I am pleased to report on the conducting administration of the Conflict of Interest Act in investigations in a 2018-2019. timely manner, and the desirability of The regimes administered by our Office reflect greater transparency. what are, in my view, the four pillars common This report illustrates to all effective conflict of interest regimes: the progress that has accountability, transparency, fairness and been achieved in consistency. these areas, as well Accountability means being responsible and as the work that answerable for one’s own actions. remains to be accomplished. Transparency relates to the public disclosure of public oﬃcials’ private interests and providing I have also identified several other areas of the public with unobstructed access to that focus, including election readiness. In fact, informa�on. I have requested and obtained a small budgetary increase to ensure continued Fairness requires a lack of bias on the part of operational excellence going forward as we the decision-maker and relates to procedural prepare for the upcoming election. fairness. I remain honoured to have been entrusted with Consistency means ensuring the same results the opportunity to administer two important when the facts are the same. components of Canada’s ethical framework on behalf of Parliament and Canadians, and With these imperatives in mind, our Office I would like to commend our employees for strives to continuously improve the way we their dedicated work in 2018-2019. administer the Act.

In last year’s annual report, I identified several activity areas that required special attention as they are in keeping with the aforementioned pillars. I noted, for example, the continued need to provide clear and consistent advice to public Mario Dion office holders and Members of the House of Conﬂict of Interest and Ethics Commissioner Commons, the potential benefits of a greater focus on education and outreach, the

1 OUR MISSION

Our Office provides independent, rigorous and consistent direction and advice to Members of Parliament and federal public office holders, conducts investigations and, where necessary, makes use of appropriate sanctions in order to ensure full compliance with the Conflict of Interest Code for Members of the House of Commons and the Conflict of Interest Act.

2 OUR STAKEHOLDERS

Our Office’s stakeholders include not only the Ministers and parliamentary 3% individuals who are subject to the conflict of secretaries (71)

interest regimes that we administer, but also 19% Governor-in-Council Parliament, academics, ethics practitioners and appointees (525) others with an interest in the field, as well as 24% Ministerial staff (667) the media and the general public. Public office holders While this report touches on all of our 54% without repor�ng stakeholder groups, its focus is on the obliga�ons (1,495) 2,758 public office holders who are subject to the Conflict of Interest Act. Although the population of public office holders fluctuates throughout the year, this number represents the individuals who were subject to the Act on Graph 1—Types of public office holders subject to March 31, 2019. Conflict of Interest Act on March 31, 2019

All public office holders are subject to the Act’s PUBLIC OFFICE core set of conflict of interest and post- HOLDERS employment rules. The Act applies to ministers, ministers of state, “Public office holders” are subject only to those parliamentary secretaries, the Chief Electoral general rules. They include part-time members Officer, the Parliamentary Budget Officer, of federal boards, commissions and tribunals, ministerial staff, ministerial advisers and most and some part-time ministerial staff. Governor-in-Council appointees, some ministerial appointees and any person “Reporting public office holders” are also designated to be subject to the Act by the subject to the Act’s reporting and public Governor in Council. (Ministers, ministers of disclosure provisions, as well as to its state and parliamentary secretaries are also prohibitions against engaging in outside subject to the Conflict of Interest Code for activities and holding controlled assets. Members of the House of Commons.) Reporting public office holders include ministers, ministers of state, parliamentary The Act sets out a number of obligations aimed secretaries, ministerial staff and full-time at preventing conflicts between private and Governor-in-Council appointees such as deputy public interests and prohibits various activities ministers, heads of Crown corporations and full- that could give rise to such conflicts. time members of federal boards.

Additional rules apply to reporting public office holders who are ministers, ministers of state, parliamentary secretaries or ministerial staff.

3 After they leave public office, public office holders. Others apply only to former reporting holders are subject to the Act’s post- public office holders during a one- or two-year employment rules. Some rules have no time “cooling-off” period. limits and apply to all former public office

1,495 1,263 1,290 1,349 1,242 1,112 Public oﬃce holders without 923 1,012 repor�ng obliga�ons Governor-in-Council 525 appointees 481 449 Ministerial staﬀ 476 667 Ministers, ministers of state 566 and parliamentary secretaries 497 381 66 66 65 71

2015-16 2016-17 2017-18 2018-19

Graph 2—Types of public oﬃce holders subject to Conﬂict of Interest Act in previous years

825 516 385 Public office 239 440 holders without 277 repor�ng obliga�ons Newly Public office appointed holders who Repor�ng public office public office le� office holders holders

Graph 3—Appointments and departures of public oﬃce holders in 2018-2019

OUR ACHIEVEMENTS

Administering the Conflict of Interest Act conflict of interest rules, and send them a letter requires our Office to undertake the following summarizing the Act’s post-employment rules core activities, among others: informing public as soon as we learn they are leaving public office holders about their obligations under the office. Act, giving them confidential direction and advice, receiving and reviewing their Among other activities, we provide reporting public office holders with information when confidential disclosures and public declarations, maintaining a public registry of publicly they are appointed or reappointed, we help declarable information, enforcing the Act as them complete their initial compliance process, we initiate their annual reviews, and we ensure appropriate, and reporting to Parliament. that all declarable information is posted in our The following pages explain how we undertook public registry. Although we respond to all these core activities during fiscal public office holders’ requests for compliance year 2018-2019. advice, we typically receive very few of such requests from those who are not reporting COMPLIANCE public office holders. Helping public office holders achieve and In order to help them comply with the Act, we maintain compliance with the Conflict of have established a service standard that Interest Act constitutes the core work of our requires that we contact all public office holders Office. We have ongoing contact with public within three days of our Office being notified of office holders starting around the time of their their appointment or reappointment. In appointment and continuing, in some cases, 2018-2019, this occurred in 62% of cases. The even after they have left public office. target for achieving this service standard was Accordingly, the Advisory and Compliance set at 80%. This discrepancy is attributable to a Division accounts for over one third of our system upgrade where numerous components human resources. (Please see figure 1 on required enhancements that slightly impeded page 21.) service delivery. We are working diligently to We communicate regularly with reporting address these issues to ensure service public office holders, given their reporting standards are met. We note, however, that first obligations under the Act, but we do not letters were sent within five business days in typically have a lot of contact with public office 90% of cases. holders who are not reporting public office holders. We do, however, reach out to these individuals when they are first appointed or reappointed to public office, send them an annual letter reminding them of the Act’s

865 381 2,066 1,913 885 516

Informa�on kits Ini�al Instances of Annual Public Informa�on on for new and compliance advice provided reminders registry post- reappointed processes to public oﬃce and annual pos�ngs employment public oﬃce holders reviews obliga�ons holders

Graph 4—Compliance ac�vi�es for public oﬃce holders in 2018-2019

Initial Compliance Process establishment of conflict of interest screens, and recusals. We guide reporting public office holders through the initial compliance process, which Our Office prepares a summary statement of begins soon after they are appointed or each confidential report and, where applicable, reappointed to public office. a public declaration of assets, outside activities and other appropriate measures. Initial contact takes the form of a first letter advising them that they must submit to our Next, we send reporting public office holders an Office a confidential report outlining their intermediate letter formalizing the advice and assets, liabilities, income, current and past measures determined by the Commissioner that activities and any other information the we provided to them verbally and asking them Commissioner considers necessary, within to sign these documents. They must return 60 days after their appointment. With the these signed documents within 120 days after letter, we send newly appointed or reappointed their appointment. We then place the summary reporting public office holders a copy of the Act statements in our public registry. and a summary of the rules that apply to them. A final letter sent by the Commissioner to Our Office provides assistance in completing the reporting public office holders signals the confidential report, as needed. Advisors review completion of the initial compliance process. each confidential report and discuss with the Information on ongoing reporting obligations, reporting public office holders any measures gifts and administrative monetary penalties is that may be needed to ensure they are enclosed. complying with the Act. Compliance measures may include the public disclosure of certain In 2018-2019, our Office established information, the divestment of controlled assets 18 compliance measures and required through a blind trust or arm’s-length sale, the

55 reporting public office holders to divest their Material changes: Reporting public office controlled assets. holders must inform us of any material change to any matter that they were required to Ongoing Reporting Requirements disclose during the initial compliance process, Reporting public office holders also face a within 30 days of the change. number of ongoing reporting requirements Gifts or other advantages: Reporting public throughout their terms of office. office holders must publicly declare any Annual review: Reporting public office holders acceptable gifts or other advantages that they must review their disclosures with advisors or their family members accept from any one from our Office every year and update source in a 12-month period with a total value information previously disclosed. of over $200. The disclosure to our Oﬃce must be made within 30 days a�er the day on which Our Office sends reporting public office holders the value exceeds $200. All public office holders an annual review letter accompanied by copies must forfeit any gifts received as an expression of their summary statement and Part 2 of the of courtesy or protocol valued at $1,000 or Act, as well as a questionnaire. Each reporting more and the forfeiture is subject to public public office holder is asked to review their disclosure. information and advise us of any change. If there are changes, an advisor in our Office may Private flights: Ministers, ministers of state and contact the individual to advise if there are any parliamentary secretaries must publicly declare, measures that they must take and whether a within 30 days, any travel on non-commercial new summary statement or declaration is chartered or private aircraft accepted for required. themselves, their families or ministerial staff or advisers. They can only accept such travel if required in their capacity as public office holders, in exceptional circumstances or with my prior approval.

125 declarations of assets 4 declarations of travel 209 gifts or on a non-commercial other advantages chartered or private 18 agreed compliance aircraft measures, including 14 conflict of interest screens 4 recusals 28 declarations of liabilities 106 outside activities

Recusals: All public office holders must recuse We have observed small increases in the themselves from any discussion, decision, volume of requests for advice in the period debate or vote on any matter in respect of following the release of an examination report. which they would be in a conflict of interest. Although we cannot ascertain that these surges Reporting public office holders must publicly are directly linked to the release of reports, we declare any recusal because of a conflict of can only assume that reports serve as a interest within 60 days after the day on which reminder to public office holders of their the recusal takes place. obligation to comply with the Act.

Firm offers of outside employment: Reporting In last year’s annual report, I acknowledged the public office holders must disclose to our Office importance of ensuring that the advice our all firm offers of outside employment, within Office provides to public office holders is clear seven days after receiving them. and consistent. Different public office holders who find themselves in the same situation must : Acceptance of offers of outside employment receive the same advice in order to reduce Reporting public office holders must disclose to uncertainty and confusion and to ensure all our Office and their employer the acceptance of public office holders feel confident that the an offer of outside employment, within seven advice they receive is fair and appropriate. days after accepting it. In 2018-2019, I continued to address this DIRECTION AND challenge by engaging in ongoing dialogue with employees who provide advice to public office ADVICE holders. Our Office also reviewed internal Public office holders frequently seek advice processes in order to support advisors in from our Office, either during or after their providing comprehensive, clear and consistent term of office. They may consult their advisors advice. in our Office about how to arrange their affairs to comply with the Conflict of Interest Act, how Outside to make a public declaration, and how to deal activities with various situations, such as whether they Post- may accept certain gifts or other advantages. employment 191 Material obliga�ons 278 659 changes Our Office provides tailored advice to public 403 office holders both during and after the initial Gi�s or other 535 General advantages compliance process. obliga�ons

Requests for advice relating to the acceptance of gifts represent 20% of the total requests Graph 5—Types of direc�on and advice given to public oﬃce received by our Office. This number has holders in 2018-2019 remained consistent in the past fiscal years.

Furthermore, our upgraded Integrated Case significantly different types of work, Management System, deployed in experiences, levels of responsibility and degrees November 2018, was launched to maintain our of influence—in order to ensure they are as ability to assist public office holders who effective as possible. This approach is reflected contact our Office for direc�on and advice. in the activities described below. (Please see Our Tools on page 20.) In 2018-2019, we started moving away from a We recognize the importance of responding to traditional “classroom” approach by developing requests for advice from public office holders in webinars, online videos and other products a timely manner and have established service using new media in order to inform and educate standards to help us do so. The target for public office holders about their obligations achieving those service standards was set at under the Act. 80%. In 2018-2019, requests from public office Our Office undertakes a range of education and holders were dealt with within three business outreach activities to help public office holders days in 92% of cases. understand and meet their obligations under the Act. They are designed to supplement, not replace, the advice and direction provided to individual public office holders on a confidential 1,843 1,753 2,084 2,066 basis by myself and by advisors in our Office, as 2015-16 2016-17 2017-18 2018-19 well as other communications we have with them regarding the initial compliance and Graph 6—Instances in which public office holders annual review processes. sought direc�on and advice Informational materials: Our Office issues, EDUCATION AND updates and disseminates a variety of documents that provide information about the OUTREACH requirements of the Act, including summaries of While I have no specific mandate under the the rules that apply to different groups of public Conflict of Interest Act to undertake educational office holders, and information notices that activities as I do under the Conflict of Interest explain the application of various provisions. Code for Members of the House of Commons, our Office implements education and outreach In April 2018, I launched a review of all initiatives on both regimes. informational materials our Office has issued under the Act to explain how the rules apply. Our Office has started following through on a The goal is to simplify them and reduce their commitment I made in last year’s annual report number to make them a more effective source to adapt our Office’s outreach and of information for public office holders to communications tools to the particular consult. In 2018-2019, we revised and updated characteristics and needs of the three distinct 12 of our informa�on no�ces and condensed groups of public office holders—ministers, their content into seven new no�ces. We are ministers of state and parliamentary planning to update and publish the rest of the secretaries, ministerial staff, including students, informa�on no�ces in 2019-2020. and Governor-in-Council appointees, each with

The updated information notices are available Correspondence: In November 2018, our Office on the Office website and accompanied by sent an annual letter to public office holders videos which are also available on our YouTube who do not have reporting obligations to channel, Ethics Canada. Together these aim to remind them of the Act’s conflict of interest offer accessible ways for public office holders to rules, with an emphasis on political activity in learn about and understand their obligations preparation for the upcoming election. under the Act. Social media: We use Twitter to communicate One of my key roles as Commissioner is to directly with public office holders, for example interpret the Act. In reviewing the informational by tweeting links to our updated information materials published by our Office for public notices and accompanying videos. (Please also office holders’ guidance, I applied an see Public Communications on page 15.) interpretation of section 35 of the Act that Collaboration: We started implementing the represents a departure from that of my predecessor. Based on a plain reading of the memorandum of understanding that I signed Act, I am of the view that public sector entities with the Commissioner of Lobbying in March 2018 to cooperate on education and are captured by the post-employment provision as they are an “entity.” In September 2018, I outreach. Under it, we agreed to jointly informed all reporting public office holders of organize educational activities for individuals affected by the work of both offices. this change via email. It is also reflected in an updated information notice on post- Accordingly, in October 2018 I co-hosted with employment rules. the Lobbying Commissioner two webinars on the subject of gifts, one in English and the other Presentations: In 2018-2019, our Office gave in French, reaching over 110 participants. 30 presentations to offices and organizations whose members are subject to the Act, reaching ENFORCEMENT a total of 314 participants. I adopted a proactive While preven�on is my major focus, I also apply approach by directly offering presentations to the enforcement provisions of the Conflict of several organizations with large numbers of Interest Act as appropriate. The enforcement public office holders and received a positive func�on also adds to the educa�onal role of our response. Office, as it has the effect of promo�ng awareness and understanding of the rules While all of our presentations to public office under the Act. holders in the last fiscal year were delivered in- person by myself and our employees, we now There are several means of enforcing the Act. have the technological capacity to offer such I can impose administra�ve monetary penal�es presentations via webinar, allowing us to reach for failures to meet certain repor�ng greater numbers of public office holders, requirements. I can issue compliance orders to including those who work outside of the ensure that public office holders meet their National Capital Region, and to better obliga�ons in the future. I can also ini�ate accommodate their busy schedules. formal inves�ga�ons, called examina�ons, of possible contraven�ons of the Act.

Administrative Monetary Penalties Compliance Orders I can issue administrative monetary penalties In cases where public office holders are not for failures to meet certain reporting meeting their obligations under the Act, I can requirements of the Act within the established issue compliance orders. deadlines, including confidential report filings, Under section 30 of the Act, I may order a disclosures of material changes, firm offers of outside employment and their acceptance, and public office holder to take any compliance public declarations of gifts and recusals. measure that I determine is necessary to comply with the Act. For example, I could order Sixteen administrative monetary penalties were imposed on public office holders in 2018-2019. public office holders to submit documents for the required annual review of the information When a penalty is issued, the Act requires that contained in their confidential report, to cease the Commissioner make public the nature of prohibited outside activities, to divest the violation, the name of the public office controlled assets, or to refrain from seeking to holder and the amount of the penalty. This has influence a decision. been done to date by means of the public registry, which is accessible through our Office’s In 2018-2019, I issued one compliance order website. To enhance their deterrent effect, on that required a public office holder to resign April 1, 2018, we started announcing on Twitter from an outside activity which conflicted with administrative monetary penalties imposed the public office holder’s position. under the Act. It is now our standard practice to Examinations announce these penalties on Twitter soon after they are added to the public registry. I can conduct examinations of possible contraventions of the Conflict of Interest Act. All examination reports are made public.

I can launch an examination at the request of a 12 14 16 16 Senator or Member of the House of Commons

2015-16 2016-17 2017-18 2018-19 who provides reasonable grounds to believe the Act has been contravened. Graph 7—Number of administra�ve monetary penal�es issued The Act also gives me the discretion to conduct an examination on my own initiative if I have Failure to reason to believe the Act has been publicly declare a gi� within contravened. I may base my decisions to self- 30 days 2 initiate an examination on information that Failure to report comes to the attention of our Office in various 4 Incomplete 10 a material ways, including media reports and complaints conﬁden�al change within report 30 days from members of the public.

Graph 8—Administra�ve monetary penal�es issued in 2018-2019

8 4 7 Case files s�ll under 3 7 considera�on at fiscal year-end 9 Case files that warranted an examina�on Case files closed without 21 31 36 28 proceeding to an examina�on

2015-16 2016-17 2017-18 2018-19

Graph 9—Concerns reviewed by our Oﬃce

Within the Current or Office Referral from former Public Sector Person not minister or subject to the parliamentary Integrity Act secretary Commissioner Current or former Members of 4 1 public oﬃce 1 4 Members the House of 30 holder 15 of the 23 Commons general

public

Graph 10—Subjects of concerns raised Graph 11—Source of concerns raised

12 8 5 4 4 2

Furthering a Preferen�al Post- Duty to Gi�s and other Inﬂuence private interest treatment employment recuse advantages rules

Graph 12—Nature of concerns raised

When our Office receives information about a It was alleged that Mr. Morneau was in a possible contravention of the Act, we open a conflict of interest when he introduced Bill C-27 case file. We review the information to because the changes to the legisla�on he determine whether the concern raised falls proposed in it could further his private interests within the mandate of our Office and, if it does, as a shareholder of Morneau Shepell Inc., a whether the Member or Senator set out their major administrator of pension plans. I needed reasonable grounds to believe or, in the case of to determine whether the interests involved a self-initiated examination, whether I have were private interests within the meaning of reason to believe that a contravention may the Act. Subsec�on 2(1) of the Act states that have occurred. Some of these initial reviews private interests do not include an interest in a lead to examinations. In other cases, an decision or mater that is of general applica�on examination is not found to be warranted and or that affects a public office holder as one of a the files are closed. broad class of persons. Since the mater under examina�on related to all stakeholders affected In 2018-2019, our Office issued five examina�on by Bill C-27, I determined that it was of general Conflict of Interest Act reports under the : applica�on. Therefore, Mr. Morneau’s interests, In the Carson Report, issued on June 7, 2018, those of his rela�ves and those of Morneau I discon�nued an examina�on under the Act of Shepell Inc. were excluded from the applica�on the post-employment conduct of of the Act. Mr. Bruce Carson, a former senior advisor in In the Chapman Report, issued on Prime Minister Stephen Harper’s Office. This June 22, 2018, as a result of a referral made by examina�on had been commenced in the Public Sector Integrity Commissioner, I April 2011 and was suspended in November of found that Ms. Marie Chapman, Chief Execu�ve the same year as a result of a criminal Officer of the Canadian Museum of Immigra�on inves�ga�on. I was only able to resume the at Pier 21, did not contravene subsec�on 6(1) or examina�on in April 2018, at which �me I sec�on 21 of the Act when she hired an alleged determined that there was no need to expend friend. I found that while Ms. Chapman had a further public resources by con�nuing an friendly working rela�onship with the examina�on of a mater that had been dealt individual, they were not “friends” for the with finality by the Supreme Court of Canada purposes of the Act. Furthermore, I found that and where all the relevant facts were public. the staffing processes were neither irregular nor In the Morneau Report, issued on unusual. Consequently, I found Ms. Chapman June 18, 2018, I found that the Honourable not to be in a conflict of interest by furthering Bill Morneau, Minister of Finance, did not the private interests of a friend or by contravene subsec�on 6(1) or sec�on 21 of the improperly furthering those of another person. Act in making decisions or having failed to In the LeBlanc Report, issued on recuse himself in rela�on to the introduc�on of September 12, 2018, I found that the Pension Bill C-27, which sought to amend the Honourable Dominic LeBlanc, when he was Benefits Standards Act, 1985. Minister of Fisheries, Oceans and the Canadian Coast Guard, contravened subsec�on 6(1) and

sec�on 21 of the Act in rela�on to his decision to pursue issuing an Arc�c surf clam licence to 39 concerns reviewed the Five Na�ons Clam Company.

The proposal submited by the company had 5 examination reports published named Mr. LeBlanc’s spouse’s first cousin, a “rela�ve” for the purposes of the Act, as General Manager should it be granted the 2 ongoing examinations on licence. The rela�ve stood to benefit financially March 31, 2019 if a licence was granted. When he made the

decision to pursue next steps in issuing the In 2018-2019, I also had two other examina�ons licence to the Five Na�ons Clam Company, under the Act that I have yet to report on. One Mr. LeBlanc had read the proposal in full, and is related to the allega�on that the was aware of the family rela�onship and the Prime Minister’s Office atempted to pressure rela�ve’s extensive involvement in the fishing the Atorney General of Canada in rela�on to industry. Furthermore, the rela�ve had raised the SNC-Lavalin prosecu�on. The nature of the the licensing issue with Mr. LeBlanc prior to the other examina�on has not been made public. decision. By deciding to pursue issuing the Arc�c surf clam licence to the Five Na�ons Clam Our Office is o�en asked for informa�on about Company, Mr. LeBlanc had an opportunity to examina�ons that are in progress, but strict further the private interests of a rela�ve in confiden�ality requirements set out in the Act contraven�on of subsec�on 6(1) of the Act and prevent us from providing any informa�on. As failed to recuse himself as required by noted elsewhere in this report, I issue a public sec�on 21. report upon the comple�on of an examina�on. When I decide to discon�nue an examina�on In the Kristmanson Report, issued on launched in response to a request from a December 12, 2018, I found that Member of the House of Commons or a Dr. Mark Kristmanson, Chief Execu�ve Officer of Senator, I issue a discon�nuance report. the Na�onal Capital Commission (NCC), contravened subsec�on 11(1) of the Act on In my last annual report, I undertook to ensure each of the 12 occasions he had accepted that our Office conducts examinations with due invita�ons, considered gi�s for the purposes of dispatch, while still conducting them thoroughly the Act, that could reasonably be seen to have and with proper diligence and being careful to been given to influence him in the exercise of respect procedural fairness. his official powers, du�es and func�ons. Dr. Kristmanson had accepted invita�ons from The average length of time it took to complete NCC stakeholders, namely Place des Fes�vals, the five examinations that I reported on in the Na�onal Arts Centre, the Canadian Museum 2018-2019, including two that were launched of Nature, VIA Rail and the Royal Canadian by my predecessor, was 212 days, compared to Geographical Society, which at the �me each an average of 336 days during our Office’s first invita�on was accepted, had ongoing or 10 years of operation. foreseeable official business with the NCC.

present my thoughts on possible amendments CONTACTS WITH in fall 2018, and that I would include something PARLIAMENT in my 2018-2019 annual reports. As an independent officer of the House of My recommenda�ons regarding possible Commons, I report directly to Parliament, amendments to the Act are described in broad through the Speaker of the House of Commons. terms below. While there is room for I am required to submit an annual report to improvement with regard to clarifying the rules Parliament by June 30 each year on the and their applica�on, I wish to emphasize that administration of the Conflict of Interest Act. I I believe the Act allows our Office to properly report on my examinations under the Act to the fulfil its mandate in the immediate term. Prime Minister. Several of my recommenda�ons seek to I also testify before parliamentary commitees strengthen the Act’s consistency and fairness, about our Office and its work. In 2018-2019, by simplifying and standardizing its provisions I was summoned to appear before two dealing with gi�s and other advantages, committees: improving its categoriza�on of public office holders, strengthening post-employment • On May 1, 2018, I appeared before the repor�ng requirements, as well as House of Commons Standing Commitee on strengthening the provisions regarding Access to Informa�on, Privacy and Ethics repor�ng obliga�ons of public office holders. about our Office’s budgetary submission for the 2018-2019 Main Es�mates. My other recommenda�ons seek to improve our Office’s efficiency and transparency by • On June 7, 2018, I appeared before the ins�tu�ng mandatory training requirements for Senate Standing Commitee on Legal and public office holders, improving inves�ga�on Cons�tu�onal Affairs during its study of processes and establishing deadlines for annual Bill C-50, An Act to amend the Canada reviews. Elections Act (political financing). Possible Amendments to the Act PUBLIC During my appearance before the House of COMMUNICATIONS Commons Standing Committee on Access to In last year’s annual report, I identified an Information, Privacy and Ethics on May 1, 2018, increase in the number of communications from I was asked if I would be making any members of the public and requests for recommendations in my 2017-2018 annual information or interviews from the media as reports to strengthen the Conflict of Interest Act significant trends. Those numbers remained at and the Conflict of Interest Code for Members of relatively high levels in 2018-2019. the House of Commons. Our Office undertakes a range of initiatives I told the Committee I did not feel I had been aimed at educating and informing our Commissioner long enough to be able to do so stakeholders, including ethics practitioners, in my last annual reports. I also expressed my academics and others with an interest in the hope that the Committee would invite me to

field, as well as the media and the general Also in November 2018, I gave two public, about Canada’s federal conflict of presentations to political science students at interest regimes and the role of our Office in the University of Ottawa, and a senior administering them. representative of our Office did so in March 2019. At the March event, we started Website: We make a wide range of information using an Internet-based audience interaction available on our Office website, which we tool that enables audience members to use update on an ongoing basis. In late 2018-2019, their mobile devices to ask questions and we started work on the development of a new participate in live polls. website that will be launched in advance of the October 2019 federal election. Media and public inquiries: Cognizant of the important role the media play in promoting Social media: We have used Twitter to awareness of the mandate and activities of our communicate more information about our Office, I have undertaken to ensure we provide Office and its activities and to retweet items of them with as much information as the regimes interest to our Office and the ethics community that I administer allow. at large, such as relevant reports from other Canadian conflict of interest commissioners and In our dealings with the media, we always take international organizations. We currently have the opportunity to inform and educate them two Twitter accounts, one for each official about my role and mandate and the functioning language. Counting the number of followers for of the Act and the Code, in order to help them both accounts, we have more than doubled our report accurately about our Office. We issue number of Twitter followers (1,023 on media advisories and news releases about our March 31, 2019), surpassing the goal of work, such as the issuance of public reports, 1,000 that I set for the end of 2018-2019 and and publicize other information, such as the increasing our Office’s social media reach. imposition of administrative monetary penalties and compliance orders via Twitter. I Presentations: Giving presentations to various participated in 14 interviews with journalists in organizations and at various events contributes 2018-2019. to public awareness of Canada’s federal conflict of interest regimes and increases public We also receive a large volume of inquiries from understanding of the Commissioner’s role and members of the public. Similarly, when we mandate. respond, we take the time to educate them about our role and mandate and, when their In November 2018, I delivered the Annual Public concerns do not fall within our mandate, try to Policy Lecture at York University’s McLaughlin direct them to other organizations that might College. I shared my perspective on the be better able to assist them. development of ethics regimes governing the conduct of federal officials in Canada and Our Oﬃce received 2,499 communications from discussed the relevance of conflict of interest the media and the public in 2018-2019. This regimes to the broader field of ethics and to represents a 19% decrease compared to last politics and democracy.

16 fiscal year. This may be due to the fact that our Office as a whole received less aten�on on COLLABORATION AND Twiter, in the news and during Ques�on Period BEST PRACTICES compared to the previous year. Our Office acts as an information resource for other jurisdictions and organizations, both The Office was domestic and international, by meeting with men�oned in 33% of visiting delegations, responding to information requests and participating in conferences Ques�on Periods in the 7,345 tweets related to conflict of interest and ethics. men�oning the House of Commons Office Our Office continued to work with counterparts in Canada and other countries in 2018-2019, 491 media men�ons of exchanging information about conflict of the Office interest rules and practices and discussing related issues in order to stay abreast of We recognize the importance of responding to concerns and developments in the field. communications from members of the public Domestic Outreach and the media in a timely manner and have established service standards to help us do so. In May 2018, our Office participated in the The target for achieving those service standards Public Sector Ethics Conference in Toronto, was set at 80%. Media requests were where I took part in a panel discussion on responded to within three hours in 86% of financial disclosure. cases. Communications from members of the In September 2018, several representatives of public were responded to within two business the Office and I attended the annual meeting of days in 81% of cases. Because of high volumes the Canadian Conflict of Interest Network and in order to maintain the high quality of our (CCOIN), held in St. John’s, Newfoundland and responses, we are looking at revising our service Labrador. Created in 1992, CCOIN is made up of standards. conflict of interest commissioners at the federal level and from all Canadian provinces and 143 315 411 260 territories. Our Office has coordinated information-gathering for CCOIN since 2010. 2015-16 2016-17 2017-18 2018-19

Graph 13—Requests for informa�on and interviews International Outreach from the media Achieving a culture of ethics and integrity is a keystone of good governance. It is also necessary for the effective functioning of democracies. Individuals who hold public office, 1,373 2,066 2,662 2,239 whether elected or appointed, are expected to always act in the public interest. Their decisions 2015-16 2016-17 2017-18 2018-19 must never be guided by their private interests Graph 14—Communica�ons from the public or those of their friends, families or relatives.

A legal framework setting out rules governing represented as well, and a senior representative conduct helps to ensure the decisions of those of our Office participated in a panel discussion who hold public office are made in the public about reporting obligations. interest. In March 2019, our Office was represented at Because these expecta�ons are clearly the Global Anti-Corruption and Integrity Forum embedded in the Conflict of Interest Act and the hosted in Paris by the Organisation for Conflict of Interest Code for Members of the Economic Co-operation and Development House of Commons, many other countries look (OECD). to Canada as a model for the development of their own conflict of interest regimes. In 2018-2019, a number of our international counterparts approached our Office to organise In July 2018, I helped found a new network of delegation visits. During such visits, we provide conflict of interest and parliamentary ethics a brief overview of the Canadian ethical organizations within the Organisation framework, as well as the role and mandate of internationale de la Francophonie. The Réseau our Office. It is also an opportunity for our parlementaire will foster the sharing of best Office to learn firsthand about the ethics practices among commissioners and other regimes in other countries. In November 2018, ethics and conflict of interest bodies. The goal is we hosted incoming delegations from the Haute to enhance expertise among the parliaments of Autorité de la Bonne Gouvernance of the Ivory Francophonie member countries in order to Coast, and the Anti-Corruption and Civil Rights adopt ethics principles and conflict of interest Commission of South Korea. rules.

In October 2018, a senior representative of our TRANSPARENCY I believe Canadians should receive as much Office made a presentation on my behalf at the information as possible about the work of our High-Level Conference on “Strengthening Office. Transparency and Accountability to Ensure Integrity: United Against Corruption.” The In last year’s annual report, I committed to event, which took place in Croatia, was making our Office and its work as transparent as organized jointly by the Group of States Against possible, while respecting the strict Corruption (GRECO) and the Croatian confidentiality requirements set out in the government. GRECO is the Council of Europe’s Conflict of Interest Act, particularly regarding anti-corruption monitoring body. examinations and advice provided to public office holders. In December 2018, several representatives of our Office attended the annual conference of There may also be other valid reasons in some the Council on Governmental Ethics Laws cases for not divulging information even when (COGEL), in Philadelphia. COGEL is a U.S.-based, we are permitted to do so. For example, I have international not-for-profit organization of chosen to not identify the subjects of ongoing government ethics practitioners of which our examinations at this time in order to safeguard Office is a member. A number of Canadian their privacy against the possibility of undue conflict of interest and integrity offices were reputational damage. If those examinations

proceed, we will report publicly on the findings figures on how our Office meets its service upon their completion. standards.

While respec�ng these constraints and other We also use the data internally to gauge our considerations, we will be as forthcoming with workload and performance, and to measure Parliament, the media and the public as we are progress towards the objectives set out in our permitted to be under the Act. Office’s strategic plan (please see Our Plan on page 20). The data also contributes to strategic In support of that commitment, in 2018-2019 decision making. we began releasing quarterly statistical reports. The purpose is to align our activities with our Our quarterly statistical report is released on mission, assess our workload and identify the last business day of the month following the current trends. end of the quarter for which the data is compiled. The aggregated data for 2018-2019 is The quarterly sta�s�cal report contains data on published in this report and in the annual report various activity areas, including the provision of under the Conflict of Interest Code for Members direction and advice to public office holders and of the House of Commons. Members of the House of Commons, education and outreach, and enforcement. It also includes

OUR TOOLS

The success of our Office’s mission is supported by the strength of our people, our plan and our OUR PLAN A rolling three-year strategic plan, which is infrastructure. published on the Office website, helps guide our projects and activities in support of our mission. OUR PEOPLE It identifies three key priorities and the means I recognize that any accomplishments I may by which we will achieve them. have as Commissioner depend on the hard work and dedication of our employees at all levels In 2018-2019, we completed a number of within the organization. specific projects and activities, identified elsewhere in this report, that contributed Accordingly, I have taken steps to ensure our directly to the following priorities: Office invests in employees’ training and • professional development and provides the Build and improve communications and outreach processes tools and equipment they need to perform their • jobs effectively and safely. I have also acted to Modernize technology and information ensure it offers a respectful, diverse and management structures • inclusive workplace and am mindful of the Maintain operational excellence importance of an appropriate work-life balance. Our strategic plan is an evergreen tool that is meant to capture the Commissioner’s vision. In The Quality Workplace Promotion Committee, January 2019, one year after I started my which I established early in my tenure as mandate as Commissioner, we conducted a Commissioner to promote employees’ strategic plan refresh exercise to pinpoint well-being, is playing a key role in some of these projects to be undertaken in the next fiscal important areas. One of the initiatives year. Those discussions led to a small shift in introduced through the Committee is the our priorities, which were identified as follows: implementation in our Office of the Canadian Mental Health Association’s Not Myself Today • Build and improve communications and program. It focuses on building greater outreach processes awareness and understanding of mental health, • Improve the Office’s mechanisms for conflict reducing stigma, and fostering safe and of interest prevention supportive work cultures. • Maintain operational excellence (tools and people) These priorities will be supported by specific projects and activities that we have identified.

Progress against our strategic plan will continue to be monitored on an ongoing basis and I will report on it in future annual reports to Parliament.

Our Office’s financial statements are audited OUR each year by an independent external auditor INFRASTRUCTURE and no concerns have been raised. A Financial We have a sound internal management Resources Summary appended to this report framework in place to ensure the prudent outlines our financial information for the stewardship of public funds, the safeguarding of 2018-2019 fiscal year. public assets and the effective, efficient and In November 2018, we launched an upgraded economical use of resources. Integrated Case Management System. All Because I am an independent officer of the informa�on from our old system was migrated House of Commons and our Office is a to the new one, supported by the House of parliamentary entity, we are not generally Commons’ informa�on technology group. subject to legislation governing the Several customiza�ons that had been made administration of the public service or to previously were replaced with more Treasury Board policies and guidelines. We try streamlined solu�ons so opera�ons were not to ensure that our resource management interrupted. Our upgraded information practices are, to the greatest extent possible, technology infrastructure is compa�ble with consistent with those found in the public service exis�ng systems and allows our Oﬃce to and in Parliament. We also look at various explore new technology op�ons for delivering policies and practices of other parliamentary our mandate. Because of the scope of this entities and generally follow what they do, transi�on, we are s�ll dealing with technical and unless there is a valid reason for our Office to procedural issues that we are working to take a different approach. resolve.

Commissioner’s Oﬃce (4)

Inves�ga�ons Communica�ons, Advisory and Corporate and Outreach and Compliance Management Legal Services Planning (18) (11) (8) (8)

Figure 1—Distribu�on of posi�ons within our Oﬃce

OUR CHALLENGES

The way I implement my mandate as As shown in graph 15, a large majority of Commissioner can be impacted by reporting public office holders have historically developments in the external environment. respected the deadlines imposed by the Act. Some of those may be viewed as challenges and I also believe that increased communica�ons others as opportunities. In my view, however, with our Office are another indicator of they all represent the potential for positive change. compliance. I have been interested in determining the average number of �mes that a public office holder contacts our Office to SAFEGUARDING THE request advice, or to make updates to their PUBLIC INTEREST files. One of the purposes of the Conflict of Interest

Act is to “minimize the possibility of conflicts arising between the private interests and public duties of public office holders and provide for the resolution of those conflicts in the public interest should they arise.”

By helping public office holders avoid and prevent conflicts between private and public 89% 91% 87% 91% 94% 93% 96% 80% 92% 96% interests, I believe our Office plays an important role in maintaining the integrity of public officials and the public institutions in which they serve.

I believe that respect of the reporting deadlines Graph 15—Percentage of new or reappointed set out in the Act are an indicator of how repor�ng public office holders who have filed within effectively we are fulfilling that role. Our data one week of the deadlines imposed by the Act illustrates that most reporting public office holders meet the deadlines set out in the Act. In One can assume that this voluntary compliance some cases, deadlines are missed because of on the part of public office holders is a step in delays in notifying our Office of appointments, the right direc�on for safeguarding the public or because of other circumstances beyond the interest. reporting public office holders’ control. We have determined that, on average, public office holders request advice twice per year.

Organisa�on for Economic Co-opera�on and LEVERAGING NEW Development’s 2019 Integrity Forum, whose TECHNOLOGIES theme was “Technology for Trust.” The Forum Just as we have made use of new technologies explored the many ways technology is being to increase the reach of our education and used by governments and organiza�ons to outreach activities and their ease of access, implement and improve their ethics I believe there are opportunities to leverage frameworks. As well, an Office employee new technologies so our Office can better assist recently atended seminars focusing on ar�ficial public office holders in identifying potential intelligence and business analy�cs in order to conflicts of interest in order to prevent them help us to start incorpora�ng technology in from developing. more of our internal processes. For example, I believe ar�ficial intelligence ELECTION READINESS could have great poten�al in the development With a federal election scheduled to take place of an electronic oversight tool. It is not beyond in October 2019, our Office’s workload is the realm of possibility that one day we could expected to increase significantly. General have a system that contains data not only on elections always occasion a high level of public office holders, such as their assets and turnover among ministers, ministers of state, liabili�es, but also on the official decisions they parliamentary secretaries, ministerial staff and are making or have made. The system would be ministerial advisers, all of whom are subject to able to automa�cally generate red flags that the Conflict of Interest Act as reporting public would alert individual public office holders as office holders. well as the Commissioner, making it possible to avoid conflicts of interest or to address them In fact, parliamentary secretaries cease being right away. We are, of course, a long way from reporting public office holders under the Act achieving such a system, and there are issues once the writ is dropped and become subject that would have to be addressed, such as how only to the Act’s post-employment provisions. to obtain and input data on decisions, as well as (Ministers, ministers of state and ministerial privacy considera�ons. staff remain subject to the Act as reporting public office holders during the election period.) In October 2015, our Office launched a secure declara�on portal to facilitate the process by In addition to assis�ng those leaving public which public office holders meet their repor�ng office with their post-employment obligations requirements. The portal usage is high (74% of under the Act, we will have to guide newly declara�ons are approved or submited through appointed ministers, ministers of state, the portal). As the portal has become a popular parliamentary secretaries, ministerial staff and tool, our Office is considering ways to increase ministerial advisers through the initial its poten�al in order to improve efficiency. compliance process. Harnessing the use of technology to improve compliance is a trend that is being seen on a global level. Our Office was represented at the

We started preparing for the elec�on in House of Commons in November 2017 that he 2018-2019. For example, we worked on had sold all the shares in his family company, processes for the hiring of employees and which rendered the applica�on moot. students to help with the increased workload. In Democracy Watch v. Attorney General of We updated leters and documents, and Canada et al., improved our fillable electronic forms to make 2018 FCA 194, the Court it easier for repor�ng public office holders to dismissed Democracy Watch’s applica�on for judicial review challenging the Commissioner’s complete their confiden�al report. We also offered presenta�ons about the Act’s post- authority to determine whether a conflict of employment rules. interest screen was an appropriate compliance measure under sec�on 29 of the Conflict of Interest Act as it applied to the Honourable COURT MATTERS Dominic LeBlanc. Our Office was granted Maters involving our Office have been the intervener status by the Court. The Court object of several applica�ons for judicial review. concluded that screens are a reasonable While dealing with them can consume a exercise of the Commissioner’s authority and significant amount of Office resources, I believe that the former Commissioner’s interpreta�on they can also be opportuni�es to clarify the and applica�on of her home statute, the basis Commissioner’s mandate and powers. for screens, was reasonable. In arriving at its decision, the Court considered the broad On October 26, 2018, the Federal Court of language of the Commissioner’s discre�onary Appeal rendered two separate unanimous powers under sec�on 29 of the Act, and judgments dismissing applica�ons for judicial determined that screens, meant to prevent review filed by the advocacy group Democracy conflicts of interest, are a measure en�rely Watch that were challenging “decisions” taken compa�ble with the intent and spirit of the Act. by the former Commissioner. Democracy Watch sought leave to appeal this In Democracy Watch v. Attorney General of decision to the Supreme Court of Canada, which Canada, 2018 FCA 195, the Court dismissed dismissed the applica�on on May 2, 2019. Democracy Watch’s applica�on for judicial On December 19, 2018, the Federal Court, in review because of mootness. Democracy Watch Democracy Watch v. Attorney General of was challenging the former Commissioner’s Canada, 2018 FC 1290, rendered a judgment leter to the Honourable Bill Morneau on the dismissing an applica�on for judicial review filed basis that it was a refusal by the former by Democracy Watch challenging the Commissioner to exercise her jurisdic�on. In appointment of Mr. Mario Dion as Conflict of that leter, Mr. Morneau was informed that he Interest and Ethics Commissioner. This decision was not required to divest his shares of private is presently being appealed by the applicant. holding corpora�ons which held publicly traded shares of a family company. The Court considered that Mr. Morneau had stated in the

APPENDICES FINANCIAL RESOURCES SUMMARY

(thousands of dollars)

2017-2018 2018-2019 Alignment to Program Activity Actual Main Total Actual Government of Canada Spending Estimates Authorities Spending Outcomes Administration of the Conflict of Interest Act and the Conflict of 5,973 6,134 6,134 5,827 Government Affairs Interest Code for Members of the House of Commons Contributions to 665 734 734 691 employee benefit plans Total Spending 6,638 6,868 6,868 6,518 Plus: Cost of services 1,148 n/a n/a 1,110 received without charge Net Cost of Department 7,786 6,868 6,868 7,628

The budget process for the Office of the Conflict of Interest and Ethics Commissioner is established in the Parliament of Canada Act. Before each fiscal year, the Commissioner has his Office prepare an es�mate of its budgetary requirements. The es�mate is considered by the Speaker of the House of Commons and then transmited to the President of the Treasury Board, who lays it before the House with the es�mates of the Government of Canada for the fiscal year. The mandate of the Standing Committee on Access to Information, Privacy and Ethics includes reviewing and reporting on our Office’s effectiveness, management and operations, together with its operational and expenditure plans.

Complete audited financial statements can be found on our website at ciec-ccie.gc.ca.

OUR HISTORY

The Office of the Conflict of Interest and Ethics Commissioner was created in July 2007 when the Conflict of Interest Act, passed in 2006 as part of the Federal Accountability Act, came into effect. It is important to understand, however, that significant milestones had already been achieved in the preceding decades.

1973 Prime Minister Pierre Elliott Trudeau introduced conflict of interest guidelines 1974 for cabinet ministers; guidelines for Prime Minister Pierre Elliott Trudeau various groups of public servants and appointed David Taylor as Canada’s first Governor-in-Council appointees were federal conflict of interest administrator, announced an Assistant Deputy Registrar General;

office established within former Department of Consumer and Corporate 1985 Affairs Prime Minister Brian Mulroney issued Conflict of Interest and Post-Employment Code for Public Office Holders,

consolidating in one document the rules for ministers, parliamentary secretaries, ministerial staff and Governor-in-Council appointees 1994 Prime Minister Jean Chrétien appointed Howard Wilson to new position of Ethics Counsellor, which replaced Assistant

Deputy Registrar General; Ethics Counsellor reported to Prime Minister 2004

An Ethics Commissioner, created as a

separate parliamentary entity, replaced the position of Ethics Counsellor; Bernard Shapiro appointed to the position; Conflict of Interest Code for Members of the House of Commons 2006 adopted Prime Minister Stephen Harper introduced Conflict of Interest Act as part of Federal Accountability Act, 2007 replaced Conflict of Interest and Post- Conflict of Interest Act came into effect; Employment Code for Public Office Mary Dawson appointed first Conflict of Holders; position of Conflict of Interest Interest and Ethics Commissioner and Ethics Commissioner was created

2017 Mario Dion was appointed second Conflict of Interest and Ethics Commissioner