Public Policy Issues and the Oliphant Commission The independent research studies in this volume reflect the views of their authors and do not necessarily reflect those of the Commission or the Commissioner. Public Policy Issues and the Oliphant Commission Independent Research Studies Prepared for Commission of Inquiry into Certain Allegations Respecting Business and Financial Dealings Between Karlheinz Schreiber and the Right Honourable Brian Mulroney Craig Forcese Director of Research © Minister of Public Works and Government Services Canada 2010 Cat. no.: CP32-92/1-2010E-PDF ISBN 978-1-100-15637-8 Library and Archives Canada Cataloguing in Publication Public policy issues and the Oliphant Commission : independent research studies / prepared for Commission of Inquiry into Certain Allegations Respecting Business and Financial Dealings Between Karlheinz Schreiber and the Right Honourable Brian Mulroney ; Craig Forcese, director of research. Issued also in French under title: Les questions de politiques publiques et la Commission Oliphant. Available also on the Internet. ISBN 978-1-100-15637-8 Cat. no.: CP32-92/1-2010E-PDF Contents Foreword ......................................................................................................ix Introduction ...............................................................................................xi 1 Regulations on Post–Public Employment: A Comparative Analysis LORI TURNBU ll Introduction .........................................................................................................1 A Cautionary Note on “Best Practices” .................................................................4 Ethics Codes Are Reactionary and Poorly Designed .......................................5 Ethics Codes Do Not Enhance Public Trust ...................................................6 Ethics Codes Undermine Politicians’ Attempts to Demonstrate Moral Fibre .....8 Ethics Codes Are Ineffective at Detecting and Deterring Misconduct ...........9 Ethics Regulation May Undermine Recruitment and Retention .....................10 The Alleged Business Relationship Between the Right Honourable Brian Mulroney and Karlheinz Schreiber ....................11 The Conflict of Interest Act ..............................................................................12 The Conflict of Interest Code for Members of the House of Commons .........15 Summary .......................................................................................................16 A Comparative Assessment of Post–Public Employment Regulations ...................17 What Behaviours and Circumstances Do Post–Public Employment Rules Regulate? ..................................................................................17 Influence .................................................................................................17 Ingratiation .............................................................................................22 Profiteering .............................................................................................23 Switching Sides .......................................................................................25 A Note on President Barack Obama’s 2009 Regulations ..........................26 Restrictions Relating to Foreign Entities ..................................................27 How Are Post–Public Employment Rules Applied and Enforced? ..................27 Conclusions and Recommendations .....................................................................31 2 Employment and Post-Employment Restrictions on Prime Ministers and Members of Parliament in Canada GRE G ORY J. LEVINE Introduction .........................................................................................................35 Analytical Framework: Method and Data .............................................................36 Further Questions ..........................................................................................36 Information ..................................................................................................37 Method ..........................................................................................................38 Analysis and Discussion........................................................................................38 The Purpose of Restraining Outside Employment and Imposing Restrictions on Post-Employment Activity ...............................................38 Integrity and Employment Restraints ............................................................38 Contract and Employment / Post-Employment Restrictions ..........................39 Legislation and Policies Dealing with the Employment and Post-Employment Activities of Elected Public Officials ............................41 The Criminal Code .........................................................................................41 The Conflict of Interest and Post-Employment Code for Public Office Holders, 1985 ...............................................................42 The Conflict of Interest Act ..............................................................................45 The Conflict of Interest Code for Members of the House of Commons .........49 The Lobbying Act ............................................................................................51 The Parliament of Canada Act ........................................................................52 Comment ......................................................................................................52 The Questions: Answers and Interpretations .................................................52 Retainer Agreements Made by a Prime Minister .............................................54 Application ..............................................................................................54 Private Business, Offers, and the Prime Minister ......................................54 Members of the House and Retainer Agreements ...........................................58 Application of the Members Code ...........................................................58 Private Business, Offers, and MPs ............................................................58 vi CONTENTS Retainer for Work After Leaving Office ..........................................................60 Forming a Contract While in Office ........................................................60 Forming a Contract for Work to Be Done After Leaving Office ...............61 Post-Employment Restrictions and the Conflict of Interest Act ...........61 Post-Employment Restrictions and the Lobbying Act ..........................64 Subject Matter of the Retainer .......................................................................65 Subject Matter .........................................................................................65 Type of Work ..........................................................................................65 Retainer Payment After the Individual Has Left Office ..................................66 Retainer Paid When the Prime Minister Left Office .................................66 Does the Length of Time After Leaving Office Matter? ............................67 Contacting Foreign Entities ...........................................................................67 Summary .......................................................................................................68 Strengthening the Current Legislation ..................................................................69 Transformation of the Conflict of Interest and Post-Employment Code to the Conflict of Interest Act ...............................69 Amending the Conflict of Interest Act ..............................................................71 Apparent Conflict of Interest ...................................................................71 Monitoring Contracting by Former Reporting Office Holders .................72 Offer, Acceptance, and Employment ........................................................72 Retainer ...................................................................................................73 Ambiguities ............................................................................................73 Amending the Members Code ......................................................................74 Status .......................................................................................................74 Apparent Conflict of Interest ...................................................................74 Post-Employment Restrictions .................................................................74 Culture and Enforcement Issues .....................................................................75 Culture ....................................................................................................75 Enforcement ............................................................................................75 Conclusion ...........................................................................................................76 CONTENTS vii 3 Who Is Getting the Message? Communications at the Centre of Government PAU L G. THOMAS Introduction .........................................................................................................77 The Communications Environments of Government ...........................................81 The Interface Between Structures and Communications .......................................85