Proceedings of the Standing Senate Committee on
Legal and Constitutional Affairs
Issue 11 - Evidence, October 5, 2006
OTTAWA, Thursday, October 5, 2006
The Standing Senate Committee on Legal and Constitutional Affairs, to which was referred Bill C-2, providing for conflict of interest rules, restrictions on election financing and measures respecting administrative transparency, oversight and accountability, met this day at 9:05 a.m. to give consideration to the bill.
Senator Donald H. Oliver (Chairman) in the chair.
[English]
The Chairman: Honourable senators, this is our twenty-fifth meeting in relation to Bill C-2, providing for conflict of interest rules, restrictions on election financing and measures respecting administrative transparency, oversight and accountability. The bill is more commonly known as the federal accountability act.
As senators, our witnesses, and members of the public both here in the room and across Canada on television know, this bill represents a central portion of the new government's agenda. It is one of the most significant pieces of legislation brought before Parliament in recent years. The committee is giving the bill the extensive, careful and detailed study that it deserves. During over 75 hours of meetings to date, we have heard from more than 130 witnesses. We have discussed topics ranging from accountability, ethics and conflict of interest, parliamentary privilege, political financing, the parliamentary budget office, access to information, privacy, whistle-blowing to audit powers and procurement.
This week we are focusing on the question of lobbying. At yesterday's meeting, we heard some very insightful comments which are sure to help us in today's deliberations.
To begin this session, I am pleased to welcome Mr. Leo Duguay, president, and Ms. Lisa Stilborn, vice-president, of the Government Relations Institute of Canada. GRIC is a national professional association representing a broad cross-section of consultant, organizational and corporate lobbyists. Joining them is Mr. Joe Jordan, a senior consultant with the Capital Hill Group, a privately owned government relations company with offices in Ottawa, Toronto and Montreal. Also at the table is Mr. Michael Murphy, executive vice-president, policy, with the Canadian Chamber of Commerce. The chamber's mission is to foster a strong, competitive and profitable economic environment that benefits not only business but all Canadians. Welcome to you.
[Translation]
The committee wants to thank you for appearing before us. You now have the floor. After your presentations, we will have a questions and discussion period which I hope will be very useful for the members of the committee.
[English]
We look forward to your presentation.
Joe Jordan, Senior Consultant, Capital Hill Group: Thank you for the invitation to be here today to discuss various aspects of Bill C-2. By way of introduction, I am a former member of Parliament. I served as Parliamentary Secretary to both the Prime Minister and the President of the Treasury Board. I was a director of parliamentary affairs in a minister's office. I am a member of the Queens' Privy Council and am currently a senior consultant with the Capital Hill Group, which is a Canadian-owned government relations company. To use the vernacular of the bill we are studying today, in the last four years I have been a public office-holder, a reporting public officer-holder, a senior public office-holder, and a registered lobbyist. Apart from the fact that I apparently have trouble holding a job, I think I can draw on some of those experiences while we discuss the various aspects of this bill. I am looking forward to that.
On a personal note, I want to state clearly that I fully support the objectives of this bill. I have experienced firsthand the cynicism that takes root when people no longer see government as having any value in their lives. If the measures in this legislation can address that perception, the entire system will benefit and the Canadians that that system serves will benefit.
Having said that, though, the bill is unprecedented in its scope and scale. It contains five sections, and I understand there were five separate drafting teams. It has 234 pages and 300 clauses. It establishes a new officer of Parliament — a parliamentary budget officer — and a director of public prosecutions and contains over 100 amendments to 30 other pieces of legislation. It would be unusual that an undertaking of this magnitude in the timelines available would foresee the potential impact of every unintended consequence. In that context, I am looking forward to a discussion about the bill and how we can perhaps improve its ability to meet the policy objectives that are outlined in its title.
In the interests of time, I will spend a few minutes on proposed amendments to the Lobbyists Registration Act in order to lay the foundation for a productive discussion of the bill. Although Bill C-2 contains eight components that directly impact the current regulatory framework for lobbying, I want to mention only two issues.
The first is more of a structural issue. The amendments in Bill C-2 will shift the lobbyist oversight mechanism from one of monitoring activity to one of regulating activity.
The Chairman: Mr. Jordan, you are reading from a paper. Do you have something I could circulate to honourable senators?
Mr. Jordan: It is in only one language, so I do not think it can be circulated. However, I can certainly leave it with the clerk.
The Chairman: If you will be talking about amendments, it would be great to have something we could read.
Mr. Jordan: It does not get that technical.
Given that one of the motivations for this change was identified as low registration compliance, that is, people were conducting lobbying activities and not registering, I feel it might be helpful if the activity is defined in either Bill C-2 or, more appropriately, the new lobby act. In the Lobbyists Registration Act, section 5 lists certain activities that require registration, but it might reduce ambiguity to have a definition in the bill. I would like to see ``lobbying'' defined along the lines of ``communicating with government decision makers to effect outcomes.'' I did not make that up; that is the Internal Revenue Service definition in the United States. It seems to me that if we put the time, energy and resources to an enforcement regulatory framework, it might be useful to clearly define what activities we are enforcing. Perhaps we can get into that during the discussion.
I make this point because I agree with the premise. A number of people carrying out lobbying activities do not consider themselves as having to register. As you raise the bar, I think that issue will become more problematic. It may look, on the surface, like we have taken steps to improve the situation but I am suggesting that perhaps in reality it might be the reverse.
Another advantage to a clear definition of lobbying is that it also provides us with a definition of what lobbying is not. It is not communications consulting and it is not polling consulting. If you look back at the examples used to justify these changes, you will find that they involved firms that carried out communications consulting for the government one day and showed up the next with paying clients to lobby the government on government relations capacities.
This bill does nothing to address that. At the very least, companies that are paid to provide consulting services for the government should not be allowed to accept payment from private companies to lobby the government. You can play around with the language of firewalls all you want, but anything short of a complete prohibition would simply be chasing your tail.
The second issue I want to address, and I am sure it will be picked up by my colleagues, is the increased regulation around disclosure of activities. This is much more of a conceptual notion because the details will be prescribed by the new commissioner of lobbying. What we do know is that the current act requires that any information collected be publicly available and the usual reference is for it to be on a website. If the committee accepts the notion that proprietary, commercially sensitive information exists, then there is a direct correlation between the level of detail required in the new reporting requirements and the potential for inadvertent release of that information. I would be more than happy to pick up that theme in the discussions.
In conclusion, this is clearly an exercise in balancing interests. The public has a right to know and companies have a right to engage decision makers without telegraphing their strategic plans and intentions.
I am confident that balance can be achieved. I do not believe that the intention of this legislation is to post transcripts of all meetings on a publicly accessible website, but in the absence of specific regulations we need to be cognizant of that issue.
Any analysis of Bill C-2 needs to take into consideration the political context in which it was developed. I recognize and even reluctantly sit in admiration of this bill in terms of its politics. This bill is great politics. What serves Canadians, and is clearly the heavy lifting that the Senate is doing, is ensuring that this bill is also good policy. I wish senators luck in that regard and look forward to a more detailed discussion on that subject.
Michael N. Murphy, Executive Vice-President, Policy, Canadian Chamber of Commerce: Honourable senators, it certainly does give me great pleasure to come before the committee this morning to present the views of the Canadian Chamber of Commerce. I will not spend much time talking about the chamber in terms of the widespread nature of our membership across the country, geography and size or type of business. We pretty well cover the gamut across the country.
We have heard from many members about this particular bill. A variety of business folks have expressed concerns to us. I would like to give you a sense of where some of those concerns lie.
Let me begin by stating that our members believe that the basic premise of the bill, increased accountability and transparency and oversight in government operations, is a solid one. In fact, we would agree there is general support in the business community for many of the measures proposed. Reforms in the area of political party financing, the role of the ethics commissioner, government polling and advertising, protection for whistle-blowers, strengthening the power of the Auditor General will be and have been well received by many in our membership. In short, the chamber supports the goals of the bill with respect to increased government accountability.
However, that said, there are areas where we have some concerns about how this increased accountability will be implemented and about the impact that certain proposals will have on the relationship between the federal government and my constituency, which is the business community.
I will start with the issue of confidentiality, which is our most significant concern. With the increased scope of the Access to Information Act, particularly with the addition of the commissioner for lobbying, our members are concerned that information of a confidential nature that they provide to government officials might later be released to the public under Access to Information Act provisions.
For example, as proposed by Bill C-2, when our members meet with certain government officials they will now need to report the subject matter of the meeting, as you know. Sometimes when companies are planning mergers, acquisitions, expansions, new facilities or other changes in their business, they wish to consult with government officials to ensure their plan for moving forward will be approved by government, if that is required, or identify areas where further details will be needed prior to obtaining government approval. Many of these discussions could also involve tax or regulatory rulings. Those companies might be hesitant to conduct these discussions if they knew their competitors could find out their business plans through an access to information request.
The Canadian Chamber of Commerce would hope any information of a confidential nature that is provided to government officials in good faith would remain confidential and not be released to the public. An exemption from reporting should be made for this type of confidential information, consistent with the rules of disclosure under section 20 of the Access to Information Act, as one example.
Section 20 of that act lists several types of information that may not be disclosed to the public, including trade secrets of a third party; financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party; information the disclosure of which could reasonably be expected to result in material financial loss, or gain, or could reasonably be expected to prejudice the competitive position of a third party; or, finally, information the disclosure of which could reasonably be expected to interfere with contractual or other negotiations.
The Chairman: Mr. Murphy, could I ask you to slow down a bit. What you are saying is being translated. This is just to be fair to the translators. I am not going to cut you off; just please go more slowly.
Mr. Murphy: I guess I am more used to the House, Mr. Chairman.
In our view, amending Bill C-2 to acknowledge the need to protect confidentiality of commercial information would be a very positive step.
The Canadian Chamber of Commerce, noting that the bill adds Export Development Canada, EDC, to the list of institutions that have a statutory prohibition against disclosure of certain information, supports the bill as drafted in this regard. The protection of third-party customer information, in the case of EDC, is critical and serves as a very good example of the need for broader protection for Canadian businesses communicating with the federal government. That is my point in raising the EDC issue today; it is a sample of how we could move forward here.
In the absence of needed assurances in this area, the Canadian Chamber of Commerce would be very concerned about a potential chilling effect in much needed and important communications between business representatives and senior public office holders. That needs to form part of the policy dialogue in this country. This could have a detrimental effect on the development of good public policy in Canada, and while there may be no intent to chill private sector dialogue, it is our view that the bill may well achieve that negative result.
One final thought on the topic of confidential or proprietary information and the need to protect it, is the impact on Canadian competitiveness, something we think about in our organization every day. It is already apparent that access to information requests are used by foreign sources to seek valuable competitive information on companies operating in Canada. Bill C-2 could exacerbate this problem by providing another avenue for those seeking to gain competitive advantage. If our competitors, in some cases, do not permit this opportunity, why would we?
I will talk briefly about the public appointments commission. I will make one comment before proceeding along the lines of the focus issues that you have for your committee today.
We supported the provision in the bill regarding the implementation of a public appointments commission and deeply regretted the events that occurred earlier this year with respect to the treatment of Mr. Gwyn Morgan, the government's nominee to chair this new commission, further to his appearance before the House of Commons Standing Committee on Government Operations and Estimates. Quite apart from the loss to the country of his exceptional talents, the chamber is concerned about the message being sent to Canadians offering to serve our public institutions. The potential chilling effect, the act of a handful of members of Parliament in that particular case, could harm our ability to attract first rate leaders from many walks of life.
Bill C-2 would also prohibit ministers, ministerial staffers and senior public servants from registering to lobby the Government of Canada for five years after leaving office. The Canadian Chamber of Commerce is concerned that this might limit the number of qualified people to pursue a career in the public service. If someone is to be prohibited from working in the government relations field, for which departing civil servants are often most qualified, they will be hesitant to take a job within government. That will mean that the pool of potential office-holders will be reduced and the people most qualified, in some cases, for these positions might be unwilling to risk applying for them. Our suggestion is to think about reducing that time frame to two years, which might be more appropriate as a reasonable length of time. We can discuss that later.
With regard to the paper burden that the bill might impose, the Canadian Chamber of Commerce notes that under the bill, those who meet or contact senior government officials will need to report those contacts within a short period of time to provide details as to the kind of contact and the subject matter discussed. This added burden of tracking meetings with government officials could be onerous for many of our small businesses, of which there are a great many. The majority of our 170,000 members are small businesses, and some are very small, as you can imagine given the size of our economy and the importance of small business to that. Our concern is about creating a barrier in this area. The opportunity in terms of increasing the burden for these companies is one that we have our eye on and we hope to think about in terms of the legislation or the regulations that follow.
The CCC hopes that the information required in these reports will be kept to a minimum and that the procedures for submitting this information will be streamlined, easy to use and not create a barrier to those wishing to have communications with senior government officials. There will need to be a careful balance between the checks and balances sought in the proposed legislation and the likelihood of more bureaucracy for its own sake.
Thank you, Mr. Chairman and honourable senators, for the opportunity to be here today to discuss this important issue. We appreciate your time and are happy to engage in discussion.
The Chairman: Thank you for your presentation. As you know, yesterday I raised a number of questions with a number of witnesses about whether the disclosure requirements could potentially compromise commercially sensitive information. I was happy to hear your comments on that today from the point of view of the Canadian Chamber of Commerce.
Mr. Duguay, please proceed with your presentation.
[Translation]
Leo Duguay, President, Government Relations Institute of Canada: Honourable senators, thank you for providing us this opportunity to appear before your Committee.
It is not my intention to repeat the presentation we have already made to the House of Commons. You already have a copy of that in hand.
You also have a copy of a letter we sent in answer to questions we were asked by the House of Commons' committee.
[English]
Our association stands proudly on the fact that we have supported every change to the Lobbyists Registration Act since its inception and this one is no different. We stand firmly behind the principles of transparency and accountability. Those are the things we think make lobbying a legitimate profession. On several occasions, the House of Commons and the Senate have reinforced that by passing bills, including the preamble, which led to the Lobbyists Registration Act, which says that lobbying public office-holders is a legitimate activity.
It is desirable that public office-holders and the public be able to know who is engaged in lobbying activities. A system for the registration of paid lobbyists should not impede free and open access to government. Those are the principles on which we have been operating.
I hasten to add that Canadians already know quite a bit about lobbyists and they know who we are, which firms we represent, who our clients are and which policies, programs and legislation we are trying to affect; that is already in the Lobbyists Registration Act. We often remind people that more information about us will not necessarily be better information. Senators might want to be mindful of the fact that they could ask us to provide much more information but it might not satisfy the public interest.
I will highlight two or three things that are key to the presentation we have made. The House of Commons asked the GRIC about the cost of recording contacts. In fact, the House was likely asking us to comment on balancing the public interest with the regulatory burden, because if the regulations are too difficult, public interest might or might not be served when there is the risk of people going underground. Other regimes in countries around the world have not adopted transparent accounting rules and, therefore, much of their business is underground. I hasten to add that much of the lobbying business in Canada was underground during the time that I was growing up.
With regard to commercially sensitive contacts, I will provide the committee with a short list of our concerns: discussions about regulations and policies concerning mergers or acquisitions; the introduction of new products, for example, vaccines, drugs or environmental devices; corporate strategies; individual and/or corporate tax matters; matters of national security; and any corporate or not-for-profit creative idea that proposes regulatory or legislative change. Those six examples represent the kinds of things that over the last 18 years my clients and I have discussed with government as being commercially sensitive. If such subjects were disclosed prematurely, there would be problems. We would suggested that the committee look at preventing premature disclosure of those subjects.
As a historical fact, none of us would have any difficulty recognizing that we made a presentation four months ago about a particular topic and the public ought to know that we did that but that now the deadline for the introduction of this new product or tax regulation has passed. From a historical perspective, we would not object; but commercially sensitive matters are often time sensitive, and that may give senators some room for dealing with this topic. We would suggest that the information under this proposed subsection be disclosed only under section 20 of the Access to Information Act, which describes commercially sensitive information.
Our point is not that Parliament should change the laws. We have no fundamental objections to anyone seeking greater transparency or accountability from lobbyists. We want senators to be sensitive to the fact that our clients have commercially sensitive information and the premature release of that information could cause significant commercial problems. Mr. Murphy commented on access to information and providing information to one company that another would be hesitant to have released.
The Chairman: Thank you. Mr. Duguay, you said that perhaps the committee could look at ways to prevent premature disclosure. You are not the first witness to make that suggestion. As you are likely aware, Mr. Nelson appeared before the committee yesterday and suggested that what could be done in respect of sensitive information is what Quebec now does: allow submissions to the commissioner that sensitive information should be registered but not on the public registry. Are you aware of that suggestion? I would like to hear the comments of each witness on that.
Mr. Duguay: Mr. Nelson, our board members and I have discussed this on a number of occasions and that would be perfectly acceptable.
Mr. Jordan: Certainly, that is one of the options that I considered. One challenge is that it would require an amendment to the current framework because the commissioner is required to disclose all information that he receives. That would be a structural fix.
It is not unlike the conflict of interest code for MPs and senators. As a public office-holder, you would disclose all kinds of financial information about your portfolios and your spouse's portfolio. That information is taken, but only a summary of it is made public. There is precedent for such an approach. I guess the push back would be, are you providing enough information in terms of the public's right to know? It is an option, but you will have to be prepared to be engaged in that subsequent discussion.
Mr. Murphy: This is an important point, and we would agree with it. The objective clearly has to be to avoid compromising the commercial objectives of businesses in Canada. That is one way you could do it. In Quebec, they have found a way to do it with their existing act. That would certainly be acceptable to us.
Senator Campbell: Mr. Jordan, I believe Mr. Beatty will be appearing before us some time in the future, but there was a suggestion that this bill could cause lobbyists ``to go underground.'' I do not know whether that is true or not. To ensure that that does not happen, I am wondering whether this proposed legislation should require the people who are listed as senior public office-holders to report, on a monthly basis, their contacts — that is, the people with whom they come into contact — so that the commissioner of lobbying can then cross-reference what is happening. It would seem to me that the onus is always being put on the lobbyist, with none on the part of the person who is being lobbied. Do you think that would be reasonable?
Mr. Jordan: I think it could address the problem. I do not want to sit here and make the economic argument. There would be a tremendous cost associated with that, and that cost would be coming out of other things. From my perspective, that would certainly go a long way to fixing it. If you look at people that would be engaging in lobbying that are not registered, you would catch those contacts, absolutely, and the commissioner could reconcile lists. It might be an easier way to do it. You also have a category of people who legitimately engage in these activities but do not trigger the 20 per cent threshold. That is another issue you may want to examine. However, your suggestion would certainly close that loop.
Senator Campbell: In fact, if the person who was being lobbied had to report it, then it would be up to the commissioner to ascertain whether the 20 per cent level had been reached or not reached and who reached it. In fact, you would be catching everyone.
Mr. Jordan: Absolutely. It would be an exception rule. They would deal with the ones that do not fit.
Mr. Duguay: I wonder, senator, if I might add a comment. We are already finding that most public office-holders ask us, ``Who are you calling on behalf of?'' Many people are asking for our registration and who our clients are.
I am very happy personally that, in the last year, we have been able to get into the newspapers the use of the term ``unregistered lobbyist.'' Many people who have been causing the profession a bad name are not registered lobbyists. Registered lobbyists are quite anxious to comply with all the rules and regulations. There were Criminal Code provisions for influence peddling. They have been in existence for a long time. Many of the accusations levelled against lobbyists should have been settled in a court of law.
Senator Campbell: I do not disagree with you, but I fail to see how this bill will stop somebody from taking a brown paper bag of money. If you want to be a crook, you will be a crook, and no law will stop you.
Mr. Jordan, I have another question, arising from your article, ``Can I go to the hockey game?'' You go to a hockey game with the Senators or senior officials or whoever — the Senators being the hockey team, not the parliamentarians — and you bump into somebody and refer to it as a happy taxpayer intervention. Anybody who has been a politician, as you say, understands that. The question I have is raised in this article. When you get to the point of disclosure, you say it really depends on whether you define yourself as a public office-holder as defined by the Lobbyists Registration Act, or as a senior public office-holder as defined by the accountability bill amendments to the Lobbyists Registration Act, or as a public office-holder as defined by the Parliament of Canada Act, or as a public office-holder as defined by the accountability bill, or as a public office-holder as defined by Part II of the Conflict of Interest and Post- Employment Code for Public Office Holders, or as a reporting public office-holder as defined by the accountability bill.
Is this true? Are there that many different places where there are definitions?
Mr. Jordan: To the best of my knowledge, that is true. That was the point I was trying to make.
Senator Campbell: How do you figure it out? You would need a list as long as your arm to come to a conclusion. Under each one of these different acts, you become a different person. Do you have a solution?
Mr. Jordan: Part of the problem is that there are codes of conduct that contain definitions but do not have the power of law. There is the Lobbyists Registration Act which you are in the process of amending, and the amending bill identifies new categories of public office-holder. It is the nature of the evolution of the process. It might make more sense to work backwards from what you are trying to accomplish. That is why I suggested at least having in one of these acts a definition of lobbying. You could spend a lot of time building a mechanism to enforce and regulate and take corrective action, but without a clear definition of lobbying, you have built that foundation on sand.
Mr. Duguay is correct that people who are registered in the system now will do exactly what you tell us to do. It is not in our interest to not do that. My concern is that you may not be capturing the most grievous offenders, like my example of companies that get paid to help the government develop communications around future policies and then, knowing what the future policies are, they also do government relations and get paid by companies to help them anticipate what the government might do.
I would challenge the committee to look at the public references used to justify these changes, and I would almost guarantee you that that is what you will find. It is not government relations companies that cause the problem here; is companies that engage in a number of activities. I would suggest, not speaking on behalf of the association but as an individual, that you should not allow companies to get paid to help the government and then get paid to help businesses figure out what the government will do. If you have only so many hours in a day and you want to make the situation better, I think you could probably take a look at that issue. It might not be as politically appealing as cracking the whip, but at the end of the day you may be serving Canadians better.
Senator Zimmer: Welcome, and thank you for your presentations this morning. I would like to recognize two old friends. Mr. Jordan, it is good to see you again, and Mr. Duguay, who is a Manitoba colleague from many years ago. I am not expressing a conflict of interest, but I am happy to see my old friends. I do not take part of any of their lobbying.
Mr. Jordan, you indicated a five-year ban. What are your thoughts on that? Mr. Murphy referenced that it probably should be two years. It would be interesting to get your further opinions on a five-year ban. Is it too long or too short?
Mr. Jordan: I am not making a decision on the issue of the policy behind that. I think I would lean towards the position of the Canadian Chamber o Commerce. Five years is a long time.
When I left as an exempt staff in a minister's office, which would be a senior public office-holder, I had a one-year ban on files and people that I dealt with in my capacity as director of parliamentary affairs. I had to sit down with the Ethics Commissioner on three occasions and go through what I did. Afterward, I received a letter saying that for the next 12 months I could not contact these people, groups or departments.
Extending that time to two years and making a total prohibition might be the way to go but not necessarily; it needs to be looked at. If the potential for abuse is so grievous that a total ban for five years would be necessary for anyone in that position, in fact so grievous that it would be retroactive, then let us include MPs and senators in the ban. You are trying to tell me that a 20-year-old staffer who is keeping a minister's schedule is banking political currency at a rate that exceeds that of a backbencher? MPs should be demonstrating outside in protest because they know stuff too. If it is that serious, Senator Zimmer, then include them in it. It makes no sense to pick on the staffers only, who, from my own experience, spend a great deal of time fighting with the bureaucracy because they are defending the interests of their ministers against the interests of the department. It is not always a holding-of-hands situation.
The public might think that five years sounds good and would be a good thing — as I said in my opening remarks, ``good politics'' — but if you truly think it is that serious, then make it wider and include MPs and senators in the five- year ban. Personally, I think that five years is too long.
The Chairman: Yesterday, one witness used the word ``networking capital,'' talking about capital in terms of the way one can use a network of contacts. Do you think that would apply to all people who work in a minister's office? Would they have networking capital?
Mr. Jordan: Absolutely yes, as would MPs and senators have networking capital. It is the nature of the business.
Mr. Duguay: As do former hockey players.
Senator Zimmer: Another outcome might be that executive exchange between the government and the private sector would end because of such a long period of time.
Lisa Stilborn, Vice-President, Government Relations Institute of Canada: Public office-holders take an oath with respect to keeping matters confidential while you are in government. What is the fear? I agree with the points made by Mr. Duguay, Mr. Jordan and Mr. Murphy. Why was this provision proposed and introduced? What are the goal and objective? It may have unintended consequences. There is networking capital in business or any other sector, including sports and entertainment. Is there a fear that current information would be current for five years and then somehow disclosed? Public office-holders sign an oath and they are bound by it when they leave government. There is a much wider spectrum of public office-holders that should be considered for a cooling-off period.
Many of you around the table are likely aware that a number of people would have gone in to assist the new government for a short period of transition time. They would assist in the public policy process for the learning and measuring experience. They most likely resisted that opportunity because of the five-year ban. I would point out that the ban has been expanded to people who participated in a transition exercise, which is also a challenge in itself, but to enforce that on a retroactive basis is a major challenge. The committee might want to consider that as well.
Mr. Duguay: Although I have fostered for most of my life the presumption that those of us who have been public office-holders know a lot, in my most candid moment I should admit that we did not know all that much.
Senator Zimmer: Mr. Murphy, you make a good point in your presentation that this might limit the number of qualified people willing to pursue a career and to provide good information to governments.
Mr. Murphy: We are a public policy advocacy organization for business, which engages us in a wide variety of issues and management on their behalf. What is important about the inside of that system is the public policy capacity to be as strong as possible, to have the ability to do the work, and to make the good decisions that the government needs to make. You want a system that encourages the best resources to work within it.
Something like this comes along once in a while that can affect the substance of the job that needs to be done so you have to pay attention and ask what the motivation for it was in the first place and whether there might be an unintended consequence as a result of it on something as important as the nation's capacity to do federal public policy.
Senator Zimmer: Mr. Duguay, in your testimony four months ago in May concerning the filing of returns, you suggested that rather than prescribe a specific time limit for the filing of returns within the bill, the filing of returns should be left to the discretion of the lobbying commissioner in respect of commercial sensitivities. How would you respond to concerns that such an open-ended reference could lead to an overuse of commercial exemptions?
Mr. Duguay: If the new position were an officer of Parliament, then I would assume that Parliament would give that person some confidence and would question the officer about the way in which that is done. I will go back to my earlier comments that these things should be made available historically such that at the end of a given year, the officer of Parliament could be required to give MPs and senators the facts of the reviewed cases, who was granted permission and why they were granted permission.
Senator Zimmer: Thank you for your candour.
Senator Joyal: Mr. Jordan and Mr. Duguay, I would like to continue the discussion on the scope of a five-year ban. We raised that issue yesterday with witnesses before the committee. Perhaps you are aware of their testimony. The fundamental principle is that someone who has been in government, whether in the House of Commons or in the Senate or in a minister's office, should not be put in a position whereby he or she would use his or her government network in the field where he or she was active.
As you said, Mr. Jordan, it is preposterous to say that a minister's assistant should be banned for five years while a senator or an MP, whose network might be much broader, could resign and immediately enter the private sector and enjoy their network. Either the principle is worthy or it is not worthy. How do we balance the system? Someone has to be the arbitrator to advise on the limits of the activities permitted for an individual.
We should establish the principle then give the commissioner the authority to arbitrate on a reasonable basis based on a period of time. There has to be a period of time, objective criteria and authority of the commissioner to review and determine each case.
Personally, I support the position that MPs and senators should be included. Senators are visible and MPs are even more visible. It is difficult for the public to have trust in the government when, for example, somebody who is involved in health happens to be defeated, resigns or does not seek re-election, then appears 30 days later on behalf of a health company or group; it creates the perception that it is a revolving door. And it is more so in the case of an MP or a senator than an anonymous staffer in a minister's office. If we are to adopt a principle that it has to be transparent, this is a case to consider.
On the other hand, we do not want to be unfair. An MP who was defeated has a compensation of some months of salary. A senator, if he or she has been serving for a minimum period of time, enjoys a pension. There is compensation for somebody who would be deprived of seeking honest work in our economy. But there is a question of balance here. Five years is a very long period, especially, as Mr. Murphy has said, if the person is not lobbying in the same sector. If you are the deputy minister of defence and you go to the supply of armaments, well, somebody will think that you should have a lapse in time. The Public Service Commissioner has been telling us that. We understand the principle of five years. It is to allow a cooling-off period and a change of guard in the department.
There has to be gradation in the system if we want to be reasonable. The objective here is to maintain transparency and be reasonable at the same time.
If the limit is five years, it should be for people who are active in the same milieu for which they were responsible in the government. There could be another period for people who were not active in that milieu, and then MPs and senators with somebody to arbitrate in between. To establish a ban all across the board seems to me unreasonable, based on my personal experience as a parliamentarian.
Mr. Duguay: I agree with everything you have said. You put some balance to the question.
I would like to throw in one more thing. I have been in this business since 1991, and I think the perception of lobbyists is that every time we talk to people, we are talking bad, we are sneaking in bad things. I would suggest that we often do good things.
We work with not-for-profit associations and we work with companies who have genuine problems that the government did not know about. We often bring to the attention of the government some really good ideas and some really good things. That should also be put into the hopper with the concept that all lobbyists do is sneak around, find their old friends, meet them at midnight in a bar over a drink and solve all these rich problems for which they get richer. If that were true I would be in the Caribbean enjoying all the money I made. It does not happen that way.
Back to the question about the cooling-off period, we agree a cooling-off period is necessary. Whether it should be two, three or five years, all we can say is that in industry, where these things are treated seriously, it is unusual to find a cooling-off period much beyond two years.
Senator Joyal: That was my second question. How do we determine the length in comparison to what is available in provincial and foreign governments?
Mr. Jordan: I am glad you focused on this. We are talking about taking away people's rights to make a living and I do not think we want to do that lightly.
We have gone from an existing framework of a one-year ban for public office-holders or exempt staff, during which they cannot engage in lobbying activities with people they had come into contact with in their job, and a two-year ban for ministers, to a five year total ban.
To speak to motive, as registered lobbyists, if we flag that as perhaps too long, I think there is some credibility there. If you want to shut the door behind me and prevent anybody from entering this business after I am in it, you will do me a huge favour. My political stock will go way up because no one who has the political experience I do will follow me into this business.
In a self-serving way I would say yes, be more restrictive. However, I do think five years is too much. You could go to a total ban of two years, but the leap to five years is a quantum leap.
You are also toughening up the regulations in other areas simultaneously. Much is happening here. It is hard sometimes to figure out where this will get us.
I think the five-year ban is prohibitive. A two-year total ban would accomplish what this legislation is trying to do.
Senator Joyal: Many of us around the table have been involved in previous discussions on conflict of interest. We want to avoid that here.
Let me give you an example: We, as senators, are prevented from sitting on the boards of non-profit corporations that might seek government support. Many of us here have had that experience. We are all involved in our respective communities, but once we are senators we are prevented from sitting on non-profit boards. However, when we are no longer senators or MPs, we can join the board and lobby the department where we feel support could be offered. There is an inconsistency there.
There should be a cooling-off period for senators and MPs, if we want to be logical with the system; otherwise, we are still in a grey or muddy area in the eyes of the public.
We have to be rational and coherent in our approach. I think we have to determine a maximum period for public office-holders, ministers and maybe some others who could not lobby in the same areas where they have been making decisions. A second tier prevents lobbying for a reasonable, but shorter period of time. Then, there is a period whereby it is in arbitration. In other words, there is arbitration, a decision being taken, because that person might not have been in a position of having a network or creating any perception. If the approach is not rational, we will muddy the system and not achieve the desired objectives but still take away people's rights.
My second question is about the time. Mr. Murphy, you suggested that two years, as used by accountants, would be reasonable. Can you give us examples or precedence from other systems to support a two-year ban?
Mr. Murphy: I do not have a specific example that would apply directly here of a government's deciding that two years is the right number.
We have rules in Canada for senior public servants and others that they cannot go back and lobby their department for a year. Mr. Jordan mentioned what happens to former MPs.
There are all kinds of rules out there. There are private sector practices, as Mr. Duguay mentioned, and auditors who have rules with respect to how soon they can return to certain areas in the corporate world. There are many examples like that. They are all over the map. There is no magic number.
We picked two years because it is, I will be frank, a long way from five. You used an excellent expression: ``cooling- off period.'' Five years, in our view, was far more chilling than cooling. Whatever the word might be, it is far more excessive.
The motivation for picking five years was a big concern as well. Somehow, there is something so egregiously wrong with the system today that we have to go to the extreme of picking a five-year period, and the impact of that I think was not clearly thought through when the number was chosen.
Senator Joyal: Can you refer us to any American precedents that employ such a lengthy ban?
Mr. Murphy: I am not aware of any; although that does not mean that they do not exist. It is just not something I have investigated. I am sure that could be determined.
Mr. Duguay: I do not have any specific information to give you, but I can tell you that the former commissioner, Mr. Wilson, has done significant work in this area. You have had him as a witness, and you may want to ask him.
From what our association has observed, Canada is probably 10 years ahead of any jurisdiction in the world in addressing lobbyist registration. Europe is now looking at a piece of legislation that will be exactly what we had when we first started in 1997. When you look at the control of lobby activities, Canada is the world leader.
Senator Joyal: Mr. Jordan, do you have any additional information on that subject?
Mr. Jordan: No, but on the point you make about the various levels and the flexibility and finding the balance and the assumption that the balance point is not exactly the same in every case, I point out that we are in a series of minority governments. You could end up with a situation where somebody is elected as an MP and a month later is no longer an MP. That person now faces a five-year ban. There needs to be some arbitration component. I think you expressed it well. In case people are worried about abuse, the commissioner could come before the Senate and House committees in camera and go through the exemptions to bring comfort to people that this is not an abuse of that power. There are ways of doing it, but initially there needs to be a discussion around the objective of this thing. Without including MPs and senators, the argument seems to indict itself, and I think you need to look at that.
Senator Andreychuk: We can discuss whether it is two years or five years, but that is a judgment call by a government as to where they think they should place the line. We can give advice as to whether we believe it is fair or not. I have absolutely no difficulty in putting MPs and senators into that category. It makes sense. There may be other ways of doing it in other pieces of legislation. It does not have to be here, but perhaps through codes of conduct, et cetera.
We are talking here about the right to livelihood for someone who has come into a system. I must honestly say the public I talk to believes that perhaps the people who take the jobs in and around the political system have capability, but they also have an ``in,'' as it is said. You are there, so you have a political leaning or an ideological leaning to work in that office.
Executive assistants and people near a minister or a parliamentarian are known to be the conduit between the minister and the public service. I have been inside the public service of Canada, and I have been a parliamentarian. People have said to me, ``We can either elect or choose not to elect a minister; a public servant is subject to the Public Service Commission, et cetera. However, all those grey people who wield power in between — we do not know how they get there.'' People are upset when they see those people in a lobbying capacity after they have left the Hill. Is this not one of the problems that we are addressing? I might say facetiously, or perhaps not facetiously, that Yes, Minister is watched here across the country, ``mandatorily,'' as someone said. We may not be dealing with a reality but rather a perception, and one that is pervasive across this country.
Mr. Jordan: I was not suggesting that legislation not do that. Those people will be captured in this bill, including ministers' exempt staff by definition and senior public office-holders, and they will have that five-year ban. Why are MPs and senators not included as well? That is my point. I agree with you that the decision to restrict rights in legislation is made when the potential for abuse is surpasses the grievous threshold. If it is so serious an issue that it needs that blunt an instrument, I have trouble following the logic of not including MPs and senators. The details, and whether two years or five, need discussion, but if you back up to the motivation, the principle itself, I am confused by the logic. I defaulted to the question of policy versus politics. To hang in the window a sign, ``We are going to address that problem,'' might very well resonate today with the electorate, given the mood, but going forward, if you are really trying to solve a problem, you either expand the scope of who is covered to everyone that potentially has access to networks and political currency, or you look at the bluntness of the instrument and perhaps find some kind of balance point or determine criteria to find a balance point.
Senator Andreychuk: I like what you have said about including. I see no reason why we should not.
Mr. Duguay: There are easy cases and hard cases. Should the associate deputy minister responsible for drug approval after retiring on Monday be helping a drug company? Should the military officer responsible for the helicopter program be out on the street within three months helping an opposing company do the work? Those are the easy cases.
The balance we are talking about says that in cases where there is direct implication, the ban should be longer, and the question of whether it is two years or five years we will leave to you. We accept the principle that if your commercial value is high, you ought not to be working in the business on Monday. For many people, their commercial value is rather limited because they worked in general areas without specific knowledge that is valuable in a commercial sense. You will have to exercise some judgment about what is appropriate. Knowing the rapidity with which government moves, I am sure that most information is stale-dated after two years.
Senator Andreychuk: You are addressing what you know and how you use it. One of the concerns I have is who you know, and those friendships go a long, long time. It is not a question of working in agriculture with the minister; it is a question of knowing the people and having access to the Hill.
Mr. Duguay, I liked what you said about the registered lobbyists and having that understood by the public, as opposed to all other kinds of activity. We have had the dialogue for many years, decades, if I may say, in Canada about access to a parliamentarian to have your views known as a citizen. It is very difficult to participate in democracy if you are sitting in Regina, Saskatchewan, in a job with a normal life. It is hard to influence the politicians on the Hill. If your member of Parliament is a backbencher in the opposition, it distances you that much further, particularly when you add the layers of the current stakeholders and focus groups, et cetera.
I think citizens are feeling disconnected and they see other people who are connected. Is that part of the culture that we have created around Parliament Hill that we should be addressing and which Bill C-2, in my opinion, is starting to address?
Mr. Duguay: I think we have to do more talking about the business of who you know. Frankly, I have been living in Ottawa for a long time, and as my mother would say, ``Il a le nez fourré partout.'' I have been in all kinds of places and I know lots of people.
My point is simple. I have many friends in Ottawa, some from the golf course, some from hockey, some from my days in Parliament. I want to tell you what happens if I ever try to call them with a dumb idea. Some of them have been polite when I have raised a dumb idea, but they sure as heck have not been polite the second time, if they ever called me back the second time.
Knowing people is a great advantage in life in every field. People like you are not susceptible to dumb ideas, but what you are susceptible to is a company, the kind I represent, with a problem, particularly if you have a problem with the area as well and we bring about a solution. That is when the business works really well, when creative lobbyists or companies bring to government solutions to real problems. That is when the system works. I suspect that if all one brings the government and one's friends is dumb ideas, one will not have a very long career.
Senator Andreychuk: The point I was trying to make is that you can bring the idea to the government because you have the opportunity to bring the idea to the government, whereas many other people whom we are supposed to be serving do not have the opportunity to bring their good or bad ideas forward.
Mr. Duguay: I do not think any of us can apologize for the fact that we have been places and done things and known people. If I may turn this around a bit, I think that it is incumbent upon public office-holders to ensure that they meet the people they ought to meet.
Throughout this discussion, we have been worried that some public office-holders do not want to meet anyone. They like the idea that they can sit in their offices with two or three trusted advisers and do what they want. This is giving them one more excuse to tell people, ``We cannot meet because the Lobbyists Registration Act says we cannot talk about these things.''
I am with you, senator. I would like to see it opened more and more. However, that is not up just to me; it is also up to you. I watch the Senate hearings with great interest. You have heard from a substantial number of people on this issue. Your researcher can probably give you the same list that I have, but I have a list of groups that have appeared before you that have made the same points, including the Canadian Society of Association Executives, the Canadian Council of Chief Executives, the Canadian Medical Association, the Canadian Bar Association, Genome Canada, and the Edmonton Journal.
The Chairman: We are quite aware of that list.
Mr. Duguay: I am a lobbyist. My role in life is not to promote the public interest. Your role in life is the public interest. We will defer to you. However, there are many other people who make the same point, and I think they make a very good point, which is that they are not against transparency or accountability, but there is a point at which those two objectives get in the way of good public policy. They are the kind of people, senator, whom you are talking about, who should be able to meet with you. I am not the only one who should be able to meet with you.
Senator Andreychuk: I think you started by saying that you do advocate good legislation, that you are supporting this legislation, but that you have some concerns with the legislation.
Mr. Duguay: That is right.
Senator Zimmer: The point was raised that it is who you know. That is true, if the status quo remains the same. Mr. Jordan and Mr. Duguay, you have both gone through election changes, where the status quo does not remain the same. Your contacts change dramatically and the effect and the response changes dramatically with a change in government. In fact, you may automatically go through a cooling-off process of two to five years without doing anything about it. When government changes, your life also changes. Could you comment on that?
Mr. Duguay: First, If everyone who told me they had voted for me had in fact voted for me, I would still be a member of Parliament.
Second, I have been a lobbyist in Ottawa since 1991, during which time there have been three or four different governments. The people change all the time. I think the people in our industry who have been there a long time, competing companies, are pretty competent people; otherwise, they would not be here for a long time.
In terms of the business of using your friends to solve a problem, your friends do not last forever. Either you have very good friends in very important places or you are very good at making new friends. It is one of the two. I suspect that for the majority of the industry, it is more than just having friends, because no one has enough friends.
Mr. Jordan: The point has been made that the contacts do change. To back up a bit, we are concentrating on one end of this transaction, which is the lobbyists' interaction with government and how that works.
I also teach government relations at arguably one of the best business schools in Canada, the Rotman School of Management in Toronto, and I can tell you that in a global world, business's interaction with government is critical. It is a critical factor in how our economy functions. Historically, Canadian businesses have not had the same level of interaction. They spend a lot of time and money managing stakeholder relationships with suppliers and customers, but that probably has its roots in the rather socialist nature of Canadian government in terms of what government does for people. However, globalization is changing that.
If you think that government relations or lobbying as an activity will decrease, I am here to tell you that you are wrong. It will only increase. You are putting in place a set of rules that will be used moving forward to monitor increased activity. It is critical that Canadian businesses can compete globally, but it is also critical that Canadian government can compete globally. It is not just one side of the equation. That does not happen if government makes its decisions in a vacuum. That does not happen if policy-makers do not want to see anyone because it means they have to fill out some forms. I do not want to minimize that. You are putting in a regulatory framework that will change that dynamic. You do not want to do it lightly.
In terms of the transaction, yes, we deal with government. However, at the back end, what puts food on our table, is that we are dealing with globally competitive companies. If we are not supplying value, they will not pay us. If all we are doing is exploiting our buddies in the locker room, we are not going to be in the business long.
There is a Darwinian aspect to this industry. Someone may be able to exploit their Rolodex for six to eight months, maybe two to five years, but I can tell you that as a profession, this is not an old boys' network in the sense that you will not be able to convince companies to pay you when margins are tight and they are competing globally if you are not providing some value. This profession polices itself to a certain extent.
The Chairman: Mr. Murphy, would you like to comment on that?
Mr. Murphy: For us, as a broad-based business organization, knowledge is the key issue, but it is knowledge in terms of being able to make a contribution to the substance of the public policy debate. That is where we provide value to our members. It is a member-driven organization. That is what our members expect of us. I hear that daily from them and I talk to our staff about it on a regular basis. The interests that we have to represent are important interests in the dialogue in the country. Doing substantive work on their behalf is significant not only in terms of how we interact with our members but also in terms of a contribution to making good public policy in Canada, which matters very much to the business community.
Senator Ringuette: This is very interesting. You have identified two situations that seem to be ongoing and yet are not addressed in Bill C-2. One is with regard to lobbyists, ``expert communicators,'' who one day do communications for the government and the next day lobby the same people for policy. You have also told us that there is an entire segment of lobbyists who have not declared themselves as lobbyists.
How can we address these two situations in this bill?
Mr. Jordan: I am not a lawyer, and that is not an apology.
You need to look at a prohibition. As I said, the registrar wrote an interpretive paper in 2001, I believe, on the issue of firewalls, the notion that you can put in place regulations to prohibit people in the same firm from talking to one another. If you can do that, you do not need to have as blunt an instrument in other areas, as you do in this bill. In the interests of consistency, if you want to fix that, prohibit companies from doing both. If you are selling your services to government, you should not be also selling your services to industry. To me, that makes a lot of sense.
With regard to unregistered lobbyists, these people look at the definitions currently in the Lobbyists Registration Act and find some rationale for why that is not what they are doing. That is why I suggested communications with the government decision makers to affect outcomes. Guess what? That is everyone who is talking to government. Then I would look at removing the 20 per cent threshold.
If I am a lawyer and do all kinds of legal things, but 19 per cent of what I do is government relations on behalf of my clients, I do not have to register. I am not caught up in this. I can carry out my business and not be the slightest bit concerned about this new set of rules.
The Chairman: That is what Duff Conacher told this committee.
Mr. Jordan: Duff and I do not agree on many things, but it follows the same logic. Be consistent with what you are trying to do. Will it be a little cumbersome for people? Yes. However, you will then not have a situation where someone is engaging in activities that we clearly need to regulate but is of the opinion that they are not covered. Believe me, that is the current case.
Senator Ringuette: You are saying that the 20 per cent threshold, which is arbitrary, should be removed?
Mr. Jordan: Yes.
Mr. Duguay: We have not talked about this, but it is an important part of the system. The Lobbyists Registration Act requires the commissioner to collect data, and that person has been so busy collecting information that they do not have time to do much else. You may know that already the time it takes for one of us to register a new client and the time before that appears on the lobby registration monitor publicly is quite long. The new requirements will require a whole new system for that kind of activity.
Our association reported cases to the commissioner over a long period of time. Justice Canada advised the department that under the previous act, in which lobbying was defined as attempting to influence prosecution, it would be almost as difficult as prosecution under the Criminal Code, so they changed the language to ``communicating for the purposes,'' which appears to be better. Now the commissioner advises that he is currently investigating four or five cases. He may have told you that.
The Chairman: He said ten.
Mr. Duguay: He may have said four or five serious cases.
The Chairman: He will report on four cases within the next few weeks.
Mr. Duguay: We are looking back to 1997. Our problem is that the wrongdoers are escaping. You have to do something about those who are doing wrong so that the rest of us can get on with our lives. This has been a serious difficulty, and I think you run the risk of more information's not being better information.
Senator Ringuette: I agree that the system gets bogged down and becomes inefficient because of a surplus of unnecessary information.
Mr. Duguay: Did anyone ask the commissioner how much it would cost for a new structure to do this?
The Chairman: Yes. He will be getting $3.5 million for his current operations, and there is a provision for more. He has done some internal costing for the number of new persons he will need.
Mr. Duguay: Could we lay a slight wager about whether that will be enough money?
Mr. Jordan: With regard to time, it is easy to talk conceptually, but I will give a specific example of how it can be problematic. In the resource industry in Canada, over the last while you have seen a lot of merger and acquisition activity. Some of these activities potentially trigger regulatory responses and Industry Canada needs to look at them in the context of the Investment Canada Act.
There are things that companies need to do in a hurry if they are to get in the sandbox and play. If it takes three months to register a new client — and senior public office-holders will not meet with a lobbyist unless they are registered in the system — you have a structural problem, because the deal may be done before you can get in and do what you need to do.
The Chairman: Does it in fact take three months? Is that a realistic figure?
Mr. Duguay: Sometimes it does.
Mr. Jordan: Sometimes it takes longer and sometimes it takes less time, but three months is a fair number to use.
There 4,700 to 5,000 registered lobbyists who now register their clients twice a year. We met with a representative of the office and have learned that the process is becoming more robust. They are questioning entries. We used to simply change the name on the top of the sheet and register five people. They are doing their job, or trying to, but they are stretched in terms of resources.
If you are now going to require filings for phone calls and meetings, that will be 300,000 to 400,000 filings a month. Government is running a registry. Think of our experiences with this. I agree with Mr. Duguay. Take the current budget for this office and, if all you want them to do is the paperwork, multiply by 30. If you want them actually to analyze the paper and take action on problems they see, multiply it by 50. I am not saying that transparency decisions should be made based on cost. I am only saying to get your cheque book out because this will be expensive.
Mr. Duguay: It is not only a matter of bringing on new people. These people have to be trained. You should see some of the questions that came back from my last batch of registrations. The people have not had time to be trained. They do not know the difference between a division of a company and a subsidiary. They are checking the websites of the companies and coming back with questions. Some of the questions have been very robust when we did not do what we should have done in the initial registration. Some of the questions have been —
The Chairman: Less than robust?
Mr. Duguay: They have been just as robust but less than something else.
Senator Ringuette: Thank you very much. This enlightens me on the entire registration and non-registration situation.
You have talked about the protection of commercially sensitive information. I would like you to expand on that. How can this bill be improved in order to protect it?
I agree that we live a global business environment and as Canadians, we want to ensure that our Canadian companies have an edge, if possible. Certainly, we do not want to remove whatever competitive ability they have by providing sensitive information to their competitors.
How can we in Bill C-2 ensure that we do not remove any kind of competitive advantage, or time-sensitive issues, as you just mentioned?
Mr. Duguay: Let me give one simple example. I sometimes have been called by companies or individuals who are not residents of Canada who have been caught up with a Canadian taxation matter. We say they should have a lawyer and an accountant. There are also fairness committees at Canada Revenue Agency, and we are better equipped at dealing with the fairness committees because we have more experience. It is less a legal and accounting environment. It is more that a problem is here; how can we resolve it? That information cannot be made public. It is too sensitive to the individuals concerned.
Our suggestion is that section 20 of the Access to Information Act already has provisions for dealing with commercially sensitive information. Perhaps you ought to duplicate those provisions in this bill.
Another way of approaching it would be to say that there is no such thing as commercially sensitive information, but some of it cannot be released today; it can only be released later.
The Chairman: That has been suggested in response to the Quebec example. All three of you answered that already.
Mr. Duguay: You may want to look at other jurisdictions, because not everything that is done everywhere else is as simple as it appears.
Quebec has sections about the costs of lobbying. If you look at what was reported last year in terms of cost, lobbyists in Quebec do not get paid very well because their total amount reported is less than it takes to run the lobby registration office. Part of that is because of the way in which they define costs. Costs are not strategy and not meetings; they are only the actual lobbying aspects. You might want to ask Quebec, New Brunswick, the United States and Europe.
I am certainly no expert, but we watch what they do to a degree. I offer the opinion that Canada has done very well and the lobbyists in Canada are proud of what Canada has done. If you are going to do more, then put it to the test: Does it improve transparency, does it improve accountability, or is it just more information for the sake of more information?
Senator Ringuette: In regard to the cooling-off period, we have talked extensively about what is reasonable and what is not. We talked this morning about someone from a public service position moving into the lobbying business.
We have not talked about, and this bill does not address, the reverse situation. I am sure that there are many capable, intelligent sector experts in your lobbyist organization who would then have access and would agree to become a public office-holder, coming from the lobbyist side of the equation. How can we address that? If a cooling-off period is fair for one side of the equation, how can we ensure that there is also a cooling-off period on the other side, that it is not a strategy for a lobbyist firm to make sure that they get one of their experts hired within to facilitate lobbying on a specific issue? How can we make sure that there is fairness on both sides of the equation?
Mr. Jordan: You get them at the other end. Lobbyists would be reluctant to accept positions that would classify them as senior public office-holders if they then had to respect a cooling-off period at the other end. I cannot imagine a situation where it would be worth their while to spend a year in a minister's office if they had to wait five years to go back to earning a living.
I am not sure that that issue is as open to potential abuse or perception of abuse as the other one.
There will also be many more public servants becoming public office-holders because there is not a talent pool in the general population to staff ministers' offices. I do not know whether anyone has looked at that situation, but you will have to recognize that is coming.
The other thing to keep in mind is that if all you did was the five-year ban, you could go home at night and say, ``I think we have done something.'' However, you are also increasing the disclosure requirements. Even if you did not do the five-year ban, you might very well catch somebody who is abusing their stuff because you are tracking what they do.
You need to look at this situation in a comprehensive way. You are making many changes simultaneously that are pushing in the same direction, but you must keep that comprehensive view in mind.
Senator Day: Mr. Duguay's suggestion of hearing from witnesses from other jurisdictions is an interesting one. We have not concentrated on that. We have been thinking more about our system and the federal side. It is funny that I should pick up on that. However, I am mindful of Mr. Jordan's point that we are 10 years ahead of most other jurisdictions. In that case, we may not get much guidance.
My understanding is that the current Lobbyists Registration Act came into force recently. It has recently been amended. Since those amendments, and given there is a five-year automatic parliamentary review built in, can you refresh my memory on what problems have become known to us? What lobbying scandals have we had in Canada that have resulted in a need for this change to legislation that was only recently reviewed and has a built-in review?
Mr. Jordan: One of the examples used to justify this step and this shift from oversight to regulation involves companies that were on communications contracts with ministries. There were employees of those companies at cabinet meetings, and those exact companies were turning around and selling their services in the private sector with information that I believe was not available in the general community.
The Chairman: Do you have examples of that?
Mr. Jordan: Check the public record. You can look at the examples that the Prime Minister cites when he talks about the need for these registrations. They always seem to mention one company. I think that you will not catch them here. You will make registered lobbyists jump a lot of hoops and, as we say, we are prepared to jump them. We will do what you tell us to do.
In our experience on the street, the abuses we see are not being captured by this bill. I am not aware of it but perhaps Mr. Duguay, in his affiliation with the association, is aware of government relations or lobbying scandals over the last little while. I have not been party to those.
Mr. Duguay: I have had an ongoing discussion with all of Canada's large newspapers about the use of the word ``lobbyist.'' Whenever they use ``lobbyist'' I send off a note saying ``not lobbyist, not registered.'' What they mean is ``unregistered lobbyist.'' The public perception is that those two are exactly the same. A piece of proposed legislation such as Bill C-2 responds to a public perception that lobbying is bad, that inappropriate activities are happening and that government has to resolve those issues. We are okay with that, as Mr. Jordan said. Certainly, it is not for me to tell legislators how legislation should be written, but it seems to me that good legislation states the policies, the principles and the themes, and then leaves room for the regulations to resolve the matter.
One problem that we had with the previous piece of proposed legislation, which took close to three years to be proclaimed, was that it was written like a regulation in that it went into details about how things should be done. Those things would be better left to a commissioner of lobbying who would bring some balance to the issue by a strict two- year rule and other rules relating specifically to the departments of the individuals.
Most of this is because of the public perception and the bad name of these unregistered people. In the case of AdScam, not one person referenced as a lobbyist was registered, to my knowledge.
Senator Day: The Lobbyists Registration Act begins unusually by stating that the act is respecting the registration of lobbyists and then says that lobbying is a good thing and should be pursued in an open and democratic society.
Each of you stated that you are supportive of the principles of the proposed legislation on transparency and accountability and a means of keeping the government accountable. We accept those principles as well. We are trying to determine whether this part of Bill C-2 in any way advances those laudable objectives. That is the reason for my question: What is driving an amendment so quickly on the heels of the previous legislation? It is interesting that you are making a point about unregistered lobbyists when the bill speaks to lobbyist registration and says that lobbying is good. As Mr. Jordan points out, it does not tell the reader what lobbying is because there is no definition of lobbying in the bill.
This committee will want to think about that. If the driving force behind this portion of Bill C-2 and the proposed accountability act is the lack of public confidence in lobbyists, then that means there are people and organizations lobbying who are not being caught and are creating a sense of unease amongst the public. We have to try to rein in that perception and convince the public that the amendments in this proposed legislation are achieving the goal.
Perhaps the committee should consider the suggestion of having a definition of lobbying. Mr. Jordan mentioned an American definition that the committee could consider. That might help to capture the intent and create the confidence that the public is seeking.
Senator Zimmer: Senator Day raises a good point about the definition of lobbying. When we heard testimony from whistle-blowers last week, Senator Campbell made a good point. He said that ``whistle-blower'' should be changed to ``information patriot.'' I would suggest, with a little humour but in all sincerity, that what you raise is the connotation of the word and you might want to call yourselves ``marketing patriots'' rather than ``lobbyists'' because the latter provides a bad connotation immediately. When you hear the word ``whistle-blower,'' it goes down that same road. Are there any comments?
Mr. Jordan: We like the term ``government relations consultant.'' It speaks to the same point. People assume that everyone knows what that term means. However, you are making regulations and an enforcement mechanism, and we have not spent the time up front to say exactly what that is.
To introduce a little clarity, if you were to talk to an unregistered lobbyist, you would learn that they think they are doing nothing wrong. This is not a dark science wherein they are operating one step ahead of the law. They are of the view that their work is not an activity that can be registered, and they will have sophisticated arguments about why that is the case. It is not that they are thumbing their nose at the rules, but they think that what they are doing is not captured in the current definitions of lobbying.
Mr. Duguay: It is difficult to say whether the name should be changed. I suspect that if you were to change the name, not much else would change. I was a member of Parliament and found at times it was good and at times it was not so good.
The other problem raised by the registrar of lobbyists on a number of occasions is what kind of language to use in legislation that would allow prosecution. They did not use ``attempting to influence'' because the Justice Canada felt that phrase provided the same strength as the Criminal Code provisions and, therefore, would be too hard to prove. Instead, they used the same language that they use for other professions, which is ``communicating for the purpose of.''
If you want a new definition and your objective is to prosecute, then you will have to be guided by lawyers who know their work.
Senator Day: My objective is to try to create public confidence in the process.
Mr. Duguay: You could truly help us in the area of unregistered lobbyists. These are the people we are talking about, and not our group of registered lobbyists. We register; we comply with the Lobbyists Registration Act; we have a code of ethics, which we discuss with our members regularly; and we have reported people to the registrar.
Senator Day: Do we have to change the definition or ask the registrar to investigate these people and tell them they should be registered?
Mr. Duguay: The Lobbyists Registration Act gives quite a bit of force to the registrar. There are fines for not registering and all kinds of things they can do. You have to give them the tools to use. I hasten to add that one of the tools might not be to ask them to collect more information about the gang you already know a lot about.
Senator Day: You said that they will have to review 300,000 to 400,000 reports. Over what period of time would that be?
Mr. Jordan: I am assuming 10 meetings or calls per week per registered lobbyist. I know people that do much more than that.
Mr. Duguay: They sometimes do that in one day.
Senator Day: The current registrar said he has three investigators to determine whether someone should be registered. As well, he will require the means to process 300,000 to 400,000 reports. The public-office holders will have to keep records to answer any one of those reports in case the proposed commissioner asks for confirmation.
Mr. Duguay: Civil servants have logs and assistants for their work and we have the same. We usually know whom we have met and what we have talked about, just as you usually know whom you have met and what you have talked about. The information is available provided you collect it from everyone, every day, all the time. That is a great deal of information. You might save time in this area if the system identifies only those who are not registered.
Senator Day: That is an interesting point.
Switching topics to the contingency fees, these are success fees. Currently, you are required to report those to the registrar. If you take on a client on and you are given a success fee, you put that in your report.
I remember the development of the issue of contingency fees or success fees in the legal profession. They were totally prohibited. As time moved along, it was felt that, as long as there was transparency, as long as people knew what was happening, it was okay. That seems to the theory up to Bill C-2. Now Bill C-2 says that we are going the other way and do not want any of that. What is your comment on that? Have you found that is an abuse, and is it just as well we say now you cannot use it?
Mr. Duguay: We have not made an issue of it because a very quick canvass of our members showed that none of them were doing it anyway. We have matured to the point where people expect to be paid for the service they provide and do not expect it to be a great big boon at the end of the cycle. It is not a big issue with any of our members now.
Mr. Jordan: Given the arbitrary nature of whether you are moving a file or not, most people in the industry are against anything that would tie compensation to getting across the finish line. The argument for it, if there is one, would be in the case of non-profits that do not have many resources. That is the argument they use in the legal community as well. I think that the proportion of the costs of engaging government, the government relations piece, would make up. In my own view, it is better to ban it than to deal with the exceptions and work it through.
Senator Day: What about a very small start-up industry looking for some government assistance to go to the next step?
Mr. Jordan: That is why it is useful that the Canadian Chamber of Commerce is here. Many of those groups will use their association as their initial vehicle for government relations. Many of those associations are conducting seminars with their members. I am not sure that is enough of an issue. If you were to ban them, you are probably doing the right thing.
Mr. Duguay: If they are that small and the issue is not complex, many of our members are doing it pro bono anyway. It is not that big a deal.
Senator Day: I see our time is running down, which disappoints me, but that happens. The definition of senior public office-holder is in clause 67on page 66 of Bill C-2, which would amend subsection 2(1) of the Lobbyists Registration Act. All the different sections are listed as to who is caught up, including section 2 of the Financial Administration Act. When you go there, that term brings in many others, so you have to jump all over the place to find out who these people are. Then it adds
(c) any individual who occupies a position that has been designated by regulation under paragraph 12(c.1).
Then, in addition to everything that is defined, you go to 12(c.1) and it says that the Prime Minister and his cabinet can name any individual or person or class of positions he wishes. Does it cause you any difficulty that, in something like this, the Prime Minister in council can determine who, including an individual position, is subject to the five-year ban?
Mr. Jordan: I guess you could look at the potential for abuse. I do not know the logic behind the drafting, but if the Prime Minister just starts randomly naming people whom he says he sought advice from or got advice from during the transition, that would be an interesting way to cause some of your enemies grief. Who checks to make sure they actually did anything? We always assume the best, but that looked a little loose when I saw it.
To add to your note, you also need to go to the Public Service Employment Act to figure out what a senior public office-holder is, because it references a clause there. It used to be quite simple. Ministers had staff, and then they had what was called exempt staff. Generally, your exempt staff were your senior policy advisor, your director of parliamentary affairs, your director of communications and your chief of staff. The trade-off for being an exempt staffer, which meant you were bound by post-employment code, was that you had bumping rights into the civil service when the house of cards came crumbling down. You also changed that. You are looking at removing that. That is a whole separate debate. However, the balance is being changed here simultaneously in many different areas. I am not sure why they could not go back to a much simpler classification of who is covered by this and who is not. That confusion is what is used to justify the activities of people who think they do not need to register — ``I do not talk to senior public office-holders. I talk to public office-holders and reporting office-holders, but according to that, it only applies to seniors.''
Senator Day: Reporting office-holders is in another act.
Mr. Jordan: That is right. The confusion around that point is not helpful on the street. The point I was making in the article I wrote and that the senator used as an example was that anything you could do to simplify it would go a long way to sorting out who is on the right side and who is on the wrong side of this.
Senator Day: Yesterday we debated what should be done by regulation, by Order-in-Council, by the Prime Minister, by Governor-in-Council, and what should be done by the commissioner who is working in this area all the time and sees where the abuses and problems are. That is an important debate that we as a committee have to consider.
Mr. Duguay: We have focussed far less on the list of contacts than we have on commercially sensitive information. Adding people to the list of whom I have to report does not help me much if I have to report commercially sensitive information.
Senator Day: I got your point on that. It is critically important, especially when we do not know now what you will be required to report. We are passing legislation that is a pig in a poke here. We do not know what it will be, but it could impact very seriously on you and your clients.
Mr. Duguay: And on the chamber.
Senator Day: I was speaking collectively.
Senator Campbell: We are focusing on the lobbyist meeting with people in government.
What happens to the lobbyist who goes into government and then gets appointed to a position that is directly related — I will not name names because it has happened. Or what happens if you leave. You are a senior officer in a company and you go into government and are appointed into a ministry directly related to the position you just left. Is that not a difficulty also?
Mr. Jordan: I certainly think it could be. The commissioner of lobbying would have a record of public office- holders, their backgrounds and bios, and that would need to be tracked through activity or somebody complaining.
Senator Campbell: I am in that position, and I am not a lobbyist. I am a minister. Where is it here that I have to report to whom I speak? You have to report if you speak to me, but I do not have to report to anybody the people to whom I speak. I support this bill, but this wall is going up here, and it is all going this way. On the other side of the wall are the people you are talking to, and there is no compunction on their part.
Mr. Duguay: Senator, you will not resolve every single problem that ever surfaces with this bill.
Senator Campbell: That is why we are senators, is it not?
Mr. Duguay: I have been on your side of the fence. I have been a chief of staff and a member of Parliament. People have called me with dumb ideas, and I did not think it required an act to tell them the idea was dumb and we would not talk about it.
Senator Campbell: We are not talking about dumb ideas. We are talking about an act that deals with a perception. The perception is that lobbyists are bad people and that the act of lobbying, although in other areas spelled out as a noble and just cause, is referred to in the press in negative terms. There should not be a double standard. If you have been a lobbyist or a senior executive, I have no problem with you going into government. I have a problem with you becoming a minister in an area in which you were previously either a lobbyist or employed in a senior position. What is good for the goose should be good for the gander.
Mr. Murphy: I understand your point, but I have the opposite view. It is important to think about various contributions that can be made. I made the point earlier about getting the right kind of people into public policy roles. I think this has been one of the failings of the system. I will use the Interchange Canada program as one example. The idea of that program was to bring a number of good people from the private sector into public service and vice versa. Over the years we did well from business into government. Many senior business representatives have had good experiences in the public sector. We have not done well with moving people the other way.
We think part of the answer is to encourage people to enter government and make a contribution at any level, ministerial or otherwise. We need to get good people in government to ensure that we are not doing anything that will discourage people from getting into the system, through legislation or otherwise, which is the point we made with respect to the five-year problem.
Mr. Jordan: Every system has good points and bad points. The Americans seem to move people from industry in and out of policy positions very quickly. Government and business need to be much more connected now. The government cannot act independently of what is happening in other jurisdictions. There are all kinds of pressures on business to compete globally. If you accept that, we can look at how to do it.
People approach government, either as individuals, companies or through lobbyists, for one of three reasons. The first has to do with policy. They do not like the rules and want you to adopt new ones or they say the government is not following the rules. The second reason is procurement; they want to sell the government something. The government buys over $13 billion a year in goods and services. The third reason is that they want grants or contributions.
The potential for abuse it probably not at the policy end. If you move people in and out of government and want them, because of their experience in business, to help make better policy, I think you can sleep at night without worrying about someone running off with buckets of cash, because that will not happen. However, if someone from a business moves into a position where they have control over either procurement or grants and contributions that could be directed to that area, there is a red flag. In the interests of perception, surely something needs to be done to at least let people know that you recognize there is potential for abuse.
Mr. Duguay: It took me some time to understand the example Senator Campbell referred to, but I now have it. When you are elected to Parliament, you are elected by a group of people in a community, and that community is responsible for your behaviour as a member of Parliament and the Prime Minister is responsible for how the cabinet behaves. That principle is far different from lobbyists.
At one time, to be the Solicitor General you had to be a lawyer. I do not know if that is still the case. A particular unique background was essential to fulfilling that cabinet position. I do not think that being a lobbyist should make you more appropriate or less appropriate for cabinet. It is a job you used to do.
The next principle is that it is incumbent on people in public life — members of Parliament and cabinet ministers — to behave appropriately. I have answered that question before about the person to whom you referred. His previous profession was no different than any other profession.
Senator Campbell: I am not referring to one person. I know at least three off the top of my head from all parties.
Mr. Duguay: I accept that. I may be referring to one of the three I also know. The point is the same. What people did before they entered public life should neither qualify nor disqualify them from any position in cabinet.
Senator Cowan: In many instances the easy solution is to have a prohibition, whether forever or for a period of time. In many circumstances, and I am thinking about universities and other activities in which all of us are involved, disclosure is important. When you and I have a conversation, it is important for me to know who you are and where you come from, and for you to know the same information about me. You can evaluate what I tell you, and you may dismiss it as simply special pleading because I happen to be a lawyer, a Liberal or whatever. You judge that.
However, if we have a conversation and you do not know that information about me, you may misinterpret what I say and give it more weight or less weight. In so many situations the easy way out is to impose a prohibition either from taking a job forever or for a period of time. What we really need is to have more disclosure of our backgrounds, our interests and the clients we represent, and then leave it up to the people with whom we meet to judge our representation accordingly.
Mr. Jordan's point is a good one about the distinction between the categories of policy development. We want to get the best possible input, regardless where it comes from, in situations where someone moves from one sector to another where they will purchase goods and services, perhaps from somebody by whom they were recently employed.
Mr. Duguay: Senator Andreychuk raised the point about the poor people who cannot hire lobbyists and should be heard in public. I am subject to a different pressure. When I represent a client as a professional lobbyist, the person I talk with expects a professional presentation. Imagine the difficulty we would be in if our presentation was poor. It is a different test.
I agree that test should often be from the person who is listening. If the presentation is from one of the top companies in Canada with a top lobby firm supported by the best lawyers and accountants and the argument being made is not very good, I think the listener would judge that negatively. If a small not-for-profit corporation from a small rural community makes a presentation, I think the listener would be more receptive to the lack of a printed PowerPoint presentation.
I agree wholeheartedly. You judge the people who present to you all the time. If they do not disclose who they are, we would think that is a bad thing. They should identify themselves, the group of people they represent and the issue they wish to speak about.
Senator Stratton: I want to put a fence around this, because we have been all over the lot this morning. We are trying to start a process, as Senator Andreychuk has stated, whereby you achieve a change in culture. That is what this bill is all about. I think everybody agrees with that.
To change a culture, we talk about public perception. We defend ourselves endlessly in that area, rightfully or wrongly, but for the most part rightfully. You look at that and you say, ``How do we do that and still respect what you need as the registrar of lobbyists?'' I will use registered lobbyists. I look at the issue of the information you supply. I agree with you that it is commercially sensitive and should not be subject to the provisions of the Access to Information Act.
In essence, the bill tries to establish a paper trail. That paper trail is the essence of what we are doing, so that if something goes wrong there will be a trail to determine how and why it went wrong. That fundamental principle is what we are doing here.
Accepting that, how does this committee, with your help, accomplish that? That is the second principle.
If that is the case, let us go to the third step: how to decide who should and should not be under the provisions of this act. As Senator Joyal has stated, there should be clear definitions. Who decides that? In essence, that is our role. Like you, I do not agree that a chauffeur or somebody filing in a minister's office should be caught under this provision. We all agree with that. Nor should a one-term MP be caught under this provision. If an MP serves for one term and is then out of office, the MP has to earn a living. That is important to remember. A one-term MP has no real influence on how government operates, so that MP should not be caught under this. Of course, we should consider MPs and senators.
You then look at the other side of the issue. Someone such as a retired senior civil servant or a retired person who worked for the Department of Defence as an armed forces colonel or whatever, should be caught under this; these people should be defined. That is where we need to wrestle with the definitions of five years and two years.
I have said a lot but I would like your quick reaction because we are out of time.
Mr. Duguay: I like the idea in particular of changing the culture. I have watched a number of your hearings some of the House proceedings on television. If you get the public to understand there are lobbyists who follow the rules and behave appropriately, and members of Parliament, cabinet ministers and exempt staff who behave appropriately, then those of us who are in that gang can get on with our business. If you can highlight the other group of people who do not register and who use their friendly networks to do bad things, then you would be helpful.
As I have said, we are in favour of transparency, accountability and all those things that accomplish that in this bill. We ask you from our point of view to protect commercially sensitive information. We did not even ask to ban it. We just said it can be historical.
Senator Andreychuk: The point is well taken.
Mr. Jordan: Our discussion today is probably a symptom of the problem. This bill is huge and I have mentioned two things in it. The rest of the bill is good. As I said in my opening remarks, I had to go door-to-door asking people for their vote when they thought I stole their money. This situation is not a good one to be in. A rising tide and a lowering tide affect all vessels equally. There needs to be — and this is not the focus of this committee — some time spent in telling people how well government works. We have a great system of government in this country. We have a professional civil service. The nature of the system focuses on the issues on which we disagree and these issues receive disproportionate attention. People who focus only on headlines and problems can sometimes fall into the trap of assuming that they are indicative of the entire system when they clearly are not. There is political capital to be gained by having these kinds of discussions.
Everybody has a responsibility to ensure that there is balance in discussions. This bill is good politics. I do not deny that for one second. However, people like us have to live with it on a daily basis. As I said, I fully support it.
With regard to the commercially sensitive issue, where the train comes off the rails is when all the information is put on a website. In the Lobbyists Registration Act, that information is publicly accessible. You can put in a system to collect all the detail you want. If the commissioner keeps it, uses it for investigative purposes, checks it or whatever, and it is not accessible through access to information and privacy, ATIP, I do not see any problem with it at all.
The Chairman: I want to give Mr. Murphy an opportunity to respond to the question as well.
Mr. Murphy: The issue of culture change is important. It is not unique to this particular bill in terms of things that may need to occur inside government.
Culture change presents its own challenges, not only in terms of agreeing that it is the right thing to do but then in understanding that it must be done correctly. That is difficult to do. I will give you one example. We have heard often in the discussions over the months with respect to this bill that some of the concerns we raised should wait until we arrive at the regulations stage and things will work out. That would be an example of a lack of cultural change that we would be very concerned about.
You have the opportunity to take action to improve the bill in the areas that we have identified. You should look at those areas seriously. These are deficiencies. Yes, go ahead and think about the tenets of the bill, proposing a major culture change with respect to transparency and accountability. We have already stated that the business community has no problem with that. It is only a question of execution.
From our standpoint, it is a matter of taking the opportunity before you. You can do some good work here.
Senator Ringuette: I would like to comment. The group in front of us recommended that we have witnesses tell us what is happening in other jurisdictions. That would be appropriate. It was mentioned that Quebec has a lobbyist act. Because of the nature of your lobbying activity, I suspect a portion of it would be in the international realm because of globalization. It would be appropriate for us to look also at other jurisdictions outside Canada.
Senator Stratton: Are you suggesting we travel to Dubai?
Senator Ringuette: No: We can probably have some experts come to Ottawa. We do not need to go to Dubai to hear what is happening in Quebec with regard to its legislation, how it works, and whether there are problems with it.
The Chairman: Normally, that is not the business for our presenters but it is done by a committee's steering committee.
Am I right that all four of you are registered lobbyists?
Mr. Murphy: Yes.
Ms. Stilborn: Yes.
Mr. Duguay: Yes.
Mr. Jordan: Yes.
The Chairman: You work in the field and do it on a daily basis.
There have been a number of questions about how old this Lobbyists Registration Act is and when was it amended, et cetera. We in this committee and in other Senate committees have staff from the Library of Parliament who have Ph.D.s, they are experts in various areas, and they prepare many background papers and documents for us.
I would like to take two minutes of this committee's time, particularly for those who are watching and do not have a copy of the Lobbyists Registration Act, to give them the history and the background.
The Lobbyists Registration Act has evolved significantly since 1989, in large part due to a statutory review provision in the legislation that requires periodic parliamentary reviews of the act.
The most recent review was conducted in 2001 by the House of Commons Standing Committee on Industry, Science and Technology. In its report, Transparency in the Information Age: The Lobbyists Registration Act in the 21st Century, the committee made several recommendations aimed at improving the operation of the act.
Bill C-15, an act to amend the Lobbyists Registration Act, responded to some of the major recommendations of the industry committee's report. Specifically, it sought to improve investigation and enforcement of the act, to simplify and harmonize the registration requirements for lobbyists, to clarify and improve the language of the act and to give effect to several technical amendments.
Although Bill C-15 received Royal Assent on June 11, 2003, the amendments did not come into force and effect until June 20, 2005 — last year — along with regulations amending the Lobbyists Registration Regulations. The delay was necessary to update the Lobbyists Registration Act regulations as well as the electronic filing system for online registration, which you have already referred to.
Indeed, on June 20, 2005, a new, more user-friendly lobbyist registration system was launched to ensure that Canadians have full and easy access to the information compiled and developed by the Office of the Registrar of Lobbyists. It is worth noting as well, that the delay in coming into force, of Bill C-15, has served to delay the next five- year statutory review of the Lobbyists Registration Act until 2010.
My question is: As registered lobbyists, does this information sound like it fairly represents the history of that statute since 1989?
Ms. Stilborn: Yes.
The Chairman: Thank you very much.
Honourable senators, we are 25 minutes overtime. I deliberately provided all senators with ample time to ask their questions and we appreciate your answers.
We have before us this morning Simon Rosenblum, a member of the steering committee of Campaign 2000 to end child poverty in Canada. Campaign 2000 is a cross-Canada public education movement to build Canadian awareness and support for the 1989 all-party House of Commons resolution to end child poverty in Canada by the year 2000.
Welcome to the committee. After you make your presentation, senators will pose questions to you and we can enter into a lively exchange. You now have the floor.
Simon Rosenblum, Member of the Steering Committee, Campaign 2000: As I look behind me as the room changed its composition, I remember many years ago testifying at hearings of the House of Commons foreign affairs committee, at that time under the chairmanship of Bill Graham. Preceding me was the head of the Canadian Labour Congress, Bob White. As soon as Mr. While finished his presentation, everyone deserted the room to chase him. I find that once again I can clear a room. This time even my colleagues who were to join me on this panel have deserted me.
With the time that you have generously provided to me, I would like to provide some context regarding the bill at issue and what I will call small non-profit NGOs.
I have spent my lifetime, more or less, working for small non-profit NGOs in one capacity or another in terms of government as the Chief of Staff to the Finance Minister of Ontario.
When I talk about small non-profit NGOs, I am talking really small. I am talking in terms of the three NGOs that, in my retirement years, I now work with on their steering committees and policy committees: organizations with budgets of $100,000 to $200,000 and with staff ranging from half a staff member up to three staff members.
That context is useful, I hope, in that you can imagine that any additional workload for these organizations, when they are already as stretched as they are, is significant. I will not blow smoke and suggest that everything will collapse if they need to do a little more paperwork and reporting; at the same time, I do not want to make it seem insignificant. There are tipping points at which things become unmanageable.
I will talk not only of Campaign 2000, but also of the Campaign Against Child Poverty and the World Federalists of Canada. They all fit into the size category I just mentioned, that type. Only one of them, Campaign 2000, is presently registered.
There is a large grey area in terms of whether an NGO registers or not: how it does its arithmetic to get to that 20 per cent of a person, and whether that counts or not. A lot of discretion is involved. I suggest that the more strenuous the process is, the more that people will opt out on one side of that grey area, depending on how it is policed.
Undoubtedly, the reporting mechanisms that are called for here are not enormous. Some people might even trivialize the mechanisms and say they are minor. However, when the NGO already has an unmanageable workload, keeping files in such a place that they know everyone that they have talked to and what meetings they have had — they have everything in that file case and they submit the information once a month, quarterly, or whatever the situation may be — is not something to dump casually on these organizations.
I do not mean to suggest that all other NGOs do not perform terribly important work, but I draw to your attention the public policy contribution of the three organizations that I have familiarity with.
When we deal with child poverty, people do not beat down the doors to send cheques. Poor people do not have the monies to contribute to organizations such as the Campaign Against Child Poverty or Campaign 2000. These people exist on a fragile basis.
Yet, when we think of the purpose that they serve as the primary advocates of over 1 million kids who are in poverty in this country, and when we contextualize that — there are always measurement issues, whether it is one out of six or seven kids and we can do our methodological comparison — no matter what the point of comparison is, we end up looking bad compared to other market democracies such as the OECD countries. Western Europe has one-half the child poverty that Canada has; Nordic countries have one-third of what we have.
There is a desperate need for organizations such as ours to do grassroots organization, moulding public opinion — or influencing it, at least, to some degree — trying to create a climate where people understand better the urgency of the issue. Obviously, there is some lobbying, although not necessarily in the more traditional vein of what people think lobbying is, but maintaining relationships with politicians so they have the most up-to-date information, appearing before committees and so on.
I point to the other organization that I play a large role in — the World Federalists of Canada. We are in a unique situation. Not too many years ago, Canada became a major player in creating the International Criminal Court. That idea did not come out of thin air. It came from the World Federalists — not just the Canadian section but our international section. We were large enough to influence a policy there, and it shows that even a small organization can play a significant role. Canada adopted this notion of a responsibility to protect in egregious situations, whether it is genocide, ethnic cleansing or other massive crimes against humanity. Again, this notion of humanitarian intervention did not come from thin air. It came from non-governmental organizations such as ourselves, who pushed it for a long time.
A major public policy contribution is made even by very small organizations who work in a niche environment. These organizations are highly professional; they are state of the art in terms of their knowledge base and their capabilities. I mentioned the World Federalists. When I think of people who have left cabinet positions and come to chair our organizations — whether it be Flora MacDonald, Warren Allmand recently or Allan Blakeney before that — we are not dealing with crackpot organizations who can open up an office.
I would hope you agree with two things. First, you do not want to create certain barriers unintentionally, where it is more difficult for them to speak to government, to try to influence it, to make sure everyone is working off the same song book as regards the data. Second, you do not want to complicate their lives unduely.
We all understand why this bill is here. Largely speaking, it is something that pertains to the for-profit sector and commercial transactions. In the House of Commons, others suggested and asked for consideration to take non-profit organizations out of the bill. It is apples and oranges. There is little to be served by lumping them together in this fashion.
I do not go so far as to say that is absolutely necessary to take them out. I conclude by appealing to you to use your good influence and powers to make life as easy for us as possible.
Senator Campbell: My first question is, are you registered?
Mr. Rosenblum: The primary organization I represent is registered; that is Campaign 2000. The other two are not.
Senator Campbell: Are you registered as a lobbyist?
Mr. Rosenblum: It will not be difficult for anyone to catch me up on details here. No one person is registered as a lobbyist. The organization is registered; if there is a name attached, I guess it would be that of the executive director.
The amount of contact with government is not enormous. However, at times, when the government considers certain bills or options in a budget, there is a rush. There are periods of time when the organization tries to meet with as many MPs as possible. When it is manageable and doable at the other end, the organization talks to deputies and associate deputies, as the case may be. It ebbs and flows.
Senator Campbell: Are you familiar with Bill C-2?
Mr. Rosenblum: I have read the sections that pertain to us. The reporting issues are the only issues I am talking about. Filing these reports and keeping the records needed to file those reports can be burdensome.
One thing you do not want is the unintended consequence of having people who would otherwise register — those who are right on that cusp of that grey area — not register because it has become a nuisance. I do not know if public policy would be served there.
Senator Campbell: Are you aware that if less than 20 per cent of one individual's time is spent lobbying, there are no requirements for filing?
Mr. Rosenblum: I have read that and I tried to get an interpretation of it. We received a call about this several days ago; my knowledge base regarding this provision goes back only three days.
When we talk about 20 per cent of one person's time, let us say you had three staff and they all put in 7 per cent, now you are at 21 per cent. On that basis, for that limited intervention vis-à-vis government and with nothing to sell per se, everything is on the public record.
We do not need to add the onus of reporting to an already backbreaking workload. When I say ``we,'' I mean the public.
Senator Campbell: One difficulty we are dealing with is that it is not public knowledge that less than under 20 per cent of one person's time spent lobbying does not require filing. It is not seen as an overriding concern of an organization.
When it is greater than 20 per cent it falls into the reporting portion. I agree with you that we should not put up barriers but there is a reason for this bill. Yesterday, we heard testimony from the Registrar of Lobbyists and one area discussed was education. If nothing else, we need a way to educate the public and the lobbyists on their respective responsibilities.
Clearly, less than 20 per cent will not affect your organization. More than 20 per cent would likely require registration and filing. You have noble ideas and I agree with what you are doing: however, education is critical. Under 20 per cent, there is no effect, but over 20 per cent, we will see what the effect will be.
Mr. Rosenblum: The 20 per cent sounds like a healthy slice of something but it is not 20 per cent of the organization's time. It could be an insignificant percentage of the organization's time because there could be three people at 7 per cent but that totals 21 per cent for the organization.
I would like to know what you mean by education. People will know neither more nor less about Campaign 2000, for example, just because we are registered.
Senator Campbell: This education is not about what people know about Campaign 2000.
Mr. Rosenblum: How we access government.
Senator Campbell: The education I am talking about is ensuring that organizations are aware of, through the office of the commissioner of lobbying, the responsibilities, the rules and the regulations. I am talking about that education and it is one component that I understand is wanted but the resources are not in place.
I am not talking about you educating us on your organization. I am talking about you accessing information to educate yourself on your responsibilities as a lobbyist.
Mr. Rosenblum: Some senior people who have held cabinet positions in this country —
Senator Campbell: Warren Allmand would not be covered by this.
Mr. Rosenblum: We are not babes in the woods in terms of our organizations' rights and responsibilities and as NGOs, how we relate to government. I think we do so in a highly professional way. There is not a great learning curve to this education. I do not think that all of a sudden we will have a better sense of our responsibilities to the Canadian public and to the Canadian Parliament by virtue of these reporting relationships.
Senator Andreychuk: I want clarification. You said that you were contacted six days ago — by whom?
Mr. Rosenblum: A senator called Campaign 2000 to ask whether we might be interested in testifying before the committee.
Senator Andreychuk: Is that the first time you reflected on this?
Mr. Rosenblum: Yes, it is the first time.
Senator Andreychuk: Are you aware of the Lobbyists Registration Act.
Mr. Rosenblum: We are registered lobbyists.
Senator Andreychuk: Is Campaign 2000 registered under the LRA or under the Charitable Registrations Act?
Mr. Rosenblum: We are registered under the LRA.
Senator Andreychuk: Is Campaign 2000 in compliance with the existing act?
Mr. Rosenblum: That is correct.
Senator Andreychuk: I am a bit confused. Are you against the current system or are you simply directing your comments to the amendments pursuant to Bill C-2?
Mr. Rosenblum: The latter.
Senator Andreychuk: Why?
Mr. Rosenblum: As I indicated I do not want the objections to be over blown. The reporting mechanisms for very small NGOs, in particular, can be burdensome. That is my only point to the committee. I ask whether the game is worth the candle, given the major public contribution of small NGOs. That question must be weighed by members of the committee. I can only repeat and there is not much purpose in that.
Senator Andreychuk: What draws you to conclude that you will have to register differently in any way with the amendments as opposed to the existing LRA?
Mr. Rosenblum: As I have been briefed, I am told that under the amendments, more reporting would be done.
Senator Andreychuk: Where did you get your briefing?
Mr. Rosenblum: From a staff person at Campaign 2000.
Senator Andreychuk: Was it in preparation for this meeting?
Mr. Rosenblum: That is correct.
Senator Andreychuk: Senator Campbell's comment to you was that under the existing act, there was no education to tell the public about the requirements. Under the proposed act, that should be clarified if the money follows.
My understanding is that you probably will not have to register because you are not that kind of an organization. Unless you are a paid person, you will spend much more time lobbying the government than you will have to.
Mr. Rosenblum: We are registered. I did not make that decision and I did not participate in the discussion on that decision. There was a sense that the 20 per cent threshold was crossed.
Senator Andreychuk: You registered under the LRA. What would change for you under the proposed legislation?
Mr. Rosenblum: It is my understanding that to date the organization has not been filing the periodic reports, although perhaps it should have filed, about whom we met and what was discussed. That is the part that is new, so I am told.
Senator Day: Would it surprise you if I told you there was no definition of ``lobbyist'' in the LRA under which you are registered?
Mr. Rosenblum: Maybe.
Senator Day: We had a discussion with previous witnesses that it might reduce confusion if there was a definition of ``lobbyist.'' Especially with smaller NGOs, it would determine whether they should file.
Section 7 of the LRA says that those duties constitute a significant part of the duties of one employee or would constitute a significant part of the duties of one employee if they were performed by only one employee; and that is the 7 per cent issue.
If three employees spent 7 per cent of their time making contacts with the government in some manner, then that equates to more than the 20 per cent. You are absolutely right on that. It has to be an organization that employs one or more individuals. All three do not have to be employed and 17 can be volunteers. It is wide in scope.
Mr. Rosenblum: Campaign 2000 is embedded in a larger organization called Family Social Services in Toronto, and the FSA sought legal opinion at that time. I saw the letter from a lawyer and the legal opinion was that we should be registered. We did what we thought was both the honourable and responsible thing to do, and that was the letter of the law, so we registered.
Senator Day: I commend you for that, even though it was burdensome. I note that one of the activities that require not-for-profits to register is the awarding of any grants, contributions or other financial benefit by or on behalf of Her Majesty in right of Canada.
If any not-for-profit volunteer organizations lobby or talk to the government with respect to the awarding of any grants, contributions or financial support, that activity requires the organization to register.
Mr. Rosenblum: Yes.
Senator Day: I am concerned that we have had two of the three smaller groups. I know how burdensome this registration requirement is for you and the reporting requirement. My understanding is that previously you reported every six months or so, that it was just the person responsible for filing returns.
Under the proposed legislation, it is monthly. It is an amendment to section 7 of the Lobbyists Registration Act, on page 72 of Bill C-2. Proposed section 7(4) says: ``The officer responsible for filing returns shall file a return, in the prescribed form and manner'' — so it is likely to have more information, and ``not later than 15 days after the end of every month, beginning with the one in which the return is filed.'' You will be required to file initially and every month thereafter unless you do not have any contact at all with anybody.
We understand that you have been briefed by your organization, and that is the filing requirement that they are concerned about. Is that correct?
Mr. Rosenblum: I have referred to that. I have read the 10 pages that are relevant to the section.
Senator Day: In a small registered organization that has only three or four people or fewer, if one of those happens to be somebody like Warren Allmand or some other former federal senior office-holder, or an office-holder, you are required to put on the return the name of the office-holder, the person who is working there and the senior office- holder. You need to tell all the information that made that person a senior office-holder. With respect to that information, what kind of burden will that be on a little organization like yours?
Mr. Rosenblum: I will say to you again that for the one, two or three staff involved in these small organizations — I do not want to make a mountain out of a molehill here — maintaining the files and doing the monthly reporting adds to an already unsupportable workload. I do not need to tell you that no one gets rich working for these organizations, and they work extremely long hours. More paperwork means something else does not happen.
I myself would err on the side of making life as easy as possible for these organizations that, frankly, are an open book. They know what they are presenting to governments and they are at standing committees all the time. They do not say anything that they do not present to standing committees, and I do not think the body of knowledge is improved one iota. That is my humble opinion. I see only a downside.
Senator Day: Mr. Rosenblum, you represent an organization that is registered, as well as two other NGOs that are not. We had hoped two others would be here, and I am disappointed they could not be, but we appreciate your comments. I hear you saying that you do not want to make a mountain out of a molehill. Are you concerned about being here today?
Mr. Rosenblum: There is a reason why the other organizations are not here, and it is workload. It is just an indication, pure and simple, of being stretched beyond where they should be stretched.
It so happens I am a volunteer and it is a little different. Because I have done this type of work in my life, it is easy to get up to speed enough to do it. Other organizations may not have a resource like that.
We thought it was worth our while to make this intervention. Again, we want to do so with the common understanding that our world will not fall apart if you proceed as envisioned, but our life would be easier if you did not.
Senator Day: You are here today voluntarily.
Mr. Rosenblum: Yes, I am.
Senator Day: Do you have any concerns about being here talking about legislation proposed by the government? Are you worried about what that might do to your relationship with the government?
Mr. Rosenblum: Absolutely not.
Senator Day: I am glad to hear that.
Mr. Rosenblum: I do not think there is a chill. We may not be in a policy sense exactly on the same page as the current government, but that being said, nothing has happened in terms of our ability to speak to government. There is no chill or no barrier from what it was previously.
Senator Day: Are you concerned about the five-year prohibition — we have called it a ``cooling off period'' — for any staffer, for example, cabinet ministers being able to be involved in NGOs? Does that cause you concern?
Mr. Rosenblum: It is not a common occurrence. However, I am a former chief of staff to a finance minister. I went back and forth between NGOs and government. There is something there.
Senator Day: If the five years had applied to you in that you were defined as a senior officer and therefore not been able to volunteer your time with an NGO for five years, would you find that oppressive?
Mr. Rosenblum: Yes, absolutely, I do. I do not think the public interest is served by that. You need to create a wall here of some sort between commercial and non-commercial issues. It is a world of difference.
Senator Joyal: Mr. Rosenblum, a previous witness this morning, Mr. Jordan, was here on behalf of Capital Hill Group. He mentioned there are three kinds of lobbying: lobbying for policy change; lobbying for procurement, that is, to sell goods and services to government; and, lobbying for grants or financial support.
In which of the three categories do your lobbying activities fall?
Mr. Rosenblum: It is 99.5 per cent in the first category.
Senator Joyal: According to the comments from the witnesses this morning, lobbying for policy is in the realm of the intangible. You make your presentation and you try to argue your case. However, many other people want to propose policy views or an aspect of a reality, where, in my opinion, it is the least difficult to conclude that the result is less close to buying favours. If a non-profit organization says that it wants a policy change for the kids of Canada, it will not be the non-profit organization that benefits.
The children of Canada will benefit. If the act bans a commission, if you succeed or not, we have set that aside. Your benefit is minimal because you are not the one who will benefit from the decision. If you sell goods and services, of course you will benefit because there will be a profit. That is the sense of a transaction. You then benefit directly. We now need to know about that kind of activity. The public has a right to know about that kind of activity.
We then go to the third type, which is the grant. If the government gives money to your organization, Canadian taxpayers have a direct right to know where their money goes and for what purpose. The government takes a decision based on other issues but you receive some tangible benefit.
In the first case, there is no tangible benefit, in my opinion. You are not the direct beneficiary, especially if you are an advocacy group. If we are to make a distinction for the non-profit corporations, we should take into account that kind of thing. As much as I support disclosure for procurements and grants, and as much as I understand that in the case of policy issues and advocacy groups, the tangible benefits do not accrue to the people who do the advocacy; the benefits are shared by thousands of people.
I am tempted to make a distinction on the basis of what Senator Campbell has said, that for non-profit corporations, when it is advocacy, you are right. As you say, advocacy is 99.5 per cent of the activities of your group. That is a peculiar and different situation. It has a different purpose. Money is not directly involved. It does not accrue directly to the group per se. There is a distinction to be made there.
Mr. Rosenblum: It is to say better what I was trying to say, to put it into the appropriate category.
We talk about financial interest. If in fact we were successful in the advocacy that we do, we would put ourselves out of business. We would be happy to do that.
Senator Joyal: You turn the world upside down.
We understand that for a great number of NGOs who do advocacy, part of their advocacy takes the majority of their supporters and those involved in it. It is a different situation if a not-for-profit corporation would try to sell goods or services to the government or try to obtain a grant. If a not-for-profit corporation spends more than 20 per cent of an employee's time or a volunteer's time to obtain support from the government through money or grants, I agree that the lobbying has to be disclosed. We know there is a direct benefit accruing to the group.
In the case of an advocacy group, I do not see the benefit flowing directly to those people. It flows to a class or group of people, but certainly, most of the time it does not benefit the person who does the advocacy. There is a distinction to be made between the two. Would that cover most of what you are looking for?
Mr. Rosenblum: I would say it covers it completely. Insofar as we try to get a grant or two for our projects, in one ministry Human Resources and Social Development Canada or in another case Foreign Affairs and International Trade Canada, I am in total agreement with you. Whatever disclosure is necessary should be provided.
If this committee and the Senate as a whole proceed on the basis you recommend, Senator Joyal, this recommendation would be well received in my community.
Senator Andreychuk: I want to pursue this line of questioning about advocacy. I do not want to talk about your organization; it would be unfair. I know it but I do not know it well enough to know every nuance. I am well aware of many organizations that would find it difficult to say, ``We are advocates now,'' but if you are a good advocate you are often the person who is then involved in the implementation of it and that leads to the grant. Let us use the International Criminal Court, or the World Federalists, of which I am a part, by the way, which started with advocacy but that advocacy led to a lot of implementation, seminars, facilitating the court, oversight of the court, and funds that have flown into it as a result of the credibility of the advocate. How do you separate advocacy and granting? How could we say today you are advocating and, by the way, tomorrow you will apply for a grant? You have to think of that or you would be precluded from the grants, if I follow your line of thinking.
Mr. Rosenblum: I do not want to split hairs. In the example you use, it is not the position of the World Federalists of Canada.
Senator Andreychuk: I appreciate that. I did not want to use a specific example.
If I advocate for something and if I do a clear case of it, it is something I am committed to so I want to see it to fruition. I start with advocacy but I end up with implementation, which is the grant possibility.
Mr. Rosenblum: You can on an occasional basis find a situation like that. I do not have a ready answer to that. It is a legitimate point to factor in. Within my experience, it is not something that happens often. Clearly, you have one that has happened, even though the only difference is that we are dealing with Canadian organizations and the reporting of Canadian NGOs.
Senator Andreychuk: Let us talk about Canadians. I worked with children's issues and many family services type of organizations. We were committed to getting our idea across and to implementing it because we cared enough about the issue. It would be as if my left hand is the advocacy and my right hand is the implementer. Thank God we have those kinds of NGOs, because they start the job and finish it. That is why I have a hard time from a government perspective trying to figure out how you are okay until you hit this point. From an advocacy point of view, I would then feel hamstrung. I have sold a good idea but now I cannot be part of it because I did not disclose that early enough.
Mr. Rosenblum: It is also true that advocates for children's poverty issues never have and have no pretensions; they are not in the delivery field.
Senator Andreychuk: You are not. That is why I did not want to use you.
Mr. Rosenblum: We are the primary organizations known in terms of the child poverty issue.
Undoubtedly, you could find somebody who might be. If I were in your shoes, I would want to factor that in.
Senator Joyal: On the same point, if an advocacy group in the course of its representation over policy change is successful and then applies for a grant or financial support to implement part of the program or objective that they have been fighting for, I totally agree with Senator Andreychuk. Then you are in the third tier, which is receiving government money. You then have to report. I have no quarrel with that. On the contrary, I am in favour of it.
When an advocacy group promotes a policy, I do not see the need to burden the not-for-profit organization for registration each month and the details that Senator Day has read into the record. However, as soon as the objective changes, the association should register.
The Chairman: On behalf of the committee, I would like to thank you for coming and sharing your thoughts and the thoughts of your organization on Bill C-2.
The committee adjourned.