Taking early action to raise ethical standards and reinforce integrity in government, Prime Minister Paul Martin provided Cabinet strengthened standards and guidelines to follow

December 13, 2003
Ottawa, Ontario

NEWS RELEASE

PRIME MINISTER REVISES ETHICAL STANDARDS FOR MINISTERS AND OTHER PUBLIC OFFICE HOLDERS

Taking early action on his commitment to raise ethical standards and reinforce integrity in government, Prime Minister Paul Martin provided to Cabinet Ministers today strengthened standards and guidelines that Ministers and other public office holders will be required to follow.

The Prime Minister said, “We must restore Canadians’ trust that their government will conduct itself in an ethical manner. We have heard the concerns of Canadians and a number of measures are being implemented to reassure the public that our new government will act with integrity.”

Tougher Conflict of Interest and Post-employment Code for Public Office Holders

The Prime Minister’s new requirements include a strengthened and updated Conflict of Interest and Post-Employment Code for Public Office Holders. The government will move immediately in the new session of Parliament to reinstate legislation to establish the office of an independent Ethics Commissioner, as well as a Senate Ethics Officer. Until legislation is passed, the Ethics Counsellor will continue to administer the Code. Strengthening of the Code includes:

• A ban on Ministers and Ministers of State accepting travel on private aircraft for any purpose except in exceptional circumstances and only with the prior approval of the Ethics Commissioner, and public reporting on such travel within 30 days;
  
  
• Stricter provisions on accepting gifts, hospitality and other benefits;
  
  
• A requirement to place gifts valued over $1000 into the Government inventory;
  
  
• Public disclosure of financial liabilities when requested by the Ethics Counsellor; and
  
  
• A recusal process which requires a public office holder to withdraw from participating in a matter that could create a conflict with their private interests as determined by the Ethics Counsellor.
  

• key elements of the democratic reform initiative, including greater freedom for Private Members to voice their views and those of their constituents through an increased number of free votes on government legislation, and a reinforced role of House Committees in shaping legislation through more frequent referral to committees of government legislation prior to second reading; and
  
  
• a new policy requiring mandatory quarterly publication of travel and hospitality expenses of Ministers, Ministers of State, Ministers’ offices, and Parliamentary Secretaries. This policy will also apply to Deputy Ministers.
  

• A robust new recusal mechanism to avoid conflict of interest that includes:
  
  
  
  • recusal when approved by the Ethics Counsellor (s. 13(1));
    
  • public disclosure of matters the Ethics Counsellor considers require the recusal of a public office holder (s. 7(2));
    
  • public disclosure of the process to be put in place to administer the recusal (s. 7(2));
    
  • annual reporting on recusal practices by the Ethics Counsellor ( Schedule, page 23); and
    
  • prohibiting Ministers, including the Prime Minister, from exercising powers or performing duties in matters which could create a conflict of interest (Schedule, page 24);
    
  
  
• A prohibition on Ministers, Ministers of State, and Parliamentary Secretaries from accepting travel for any purpose on noncommercial charter or private aircraft, except in exceptional circumstances and only with the prior approval of the Ethics Counsellor. (S.20(2)) When such travel is approved, it must be declared publicly within 30 days, identifying the travel provider and the circumstances. (s.20(3));
  
  
• A new requirement in the Code that public office holders must place into the government inventory any gifts valued over $1000 arising out of activities associated with the performance of their official duties and responsibilities. (S.22(2));
  
  
• A new requirement for public office holders to consult the Ethics Counsellor when they have any doubt as to the appropriateness of accepting an offer of a gift, hospitality or benefit, including from family members and close personal friends, and to obtain the approval of the Ethics Counsellor to accept the offer. (S.22(4));
  
  
• A provision enabling the Ethics Counsellor to require ministers of the Crown, Ministers of State and Parliamentary Secretaries to disclose publicly the source and nature of liabilities that could create a conflict of interest. (s. 14);
  
  
• A new requirement that public office holders’ confidential reports to the Ethics Counsellor must cover income, and a new requirement for public office holders to disclose to the Ethics Counsellor any other information required to ensure compliance with the Code (s. 9);
  
  
• A clarification that meetings between those managing assets in a blind management arrangement and the public office holder (in exceptional circumstances where an extraordinary event could affect the assets) must be in the presence of the Ethics Counsellor (Schedule 1(b) on Blind management arrangements, page 23);
  
  
• A new provision to prevent destruction of the records of a public office holder if a complaint or investigation is underway (s. 5(3));
  
  
• A requirement that the Prime Minister can only reduce limitation periods on post-employment requirements with the Ethics Counsellor’s approval (s. 31(1)); and
  
  
• New prohibitions on avoiding or attempting preferential treatment to prevent public office holders from:
  
  
  
  • using their position to influence others improperly (s. 23(4)); and
    
  • using insider information (s. 23(5)).
    
  
  

• The Prime Minister’s message urges his Cabinet to lead in adapting our political institutions to enhance confidence in Canada’s system of government. It also sets out that the core principles of the government will be transparency, accountability, financial responsibility, and ethical conduct (Page iii).
  
  
• A greatly expanded role for Parliamentary Secretaries is outlined, ensuring that they are key resources in a Minister’s portfolio, full participants in the government’s work, and a fundamental link between Ministers and Parliament. They can be assigned specific duties by the Prime Minister on key policy issues. To reinforce their expanded role, they are being sworn in as Privy Councillors so they can be invited to Cabinet and Cabinet Committee discussions as appropriate. They will play a pivotal role in representing the concerns of Parliamentarians to their Minister and within government more broadly (Pages 9-11).
  
  
• In support of the Democratic Reform agenda, the Guide describes:
  
  
  
  • a three line voting system which will give Private Members much greater freedom to voice their views and those of their constituents through an increased number of free votes on government legislation other than votes of confidence and a limited number of matters of fundamental importance to the government (Page 16);
    
    
  • what the more active role of parliamentary committees in policy development, legislative review, and expenditure oversight will require of Ministers and their officials to promote ongoing dialogue (Page 19); and
    
    
  • how appointments to certain key positions, including heads of Crown corporations and agencies, will now be subject to prior Parliamentary review. The government will consult with the appropriate House committees on how best to proceed on prior review of these appointments. The government will specifically consult with the Standing Committee on Justice and Human Rights on how best to implement prior review of appointments of Supreme Court of Canada Judges. These committees will also have the opportunity to consider which other appointments could be subject to their review (Page 26).
    
    
  • The Guide signals the government’s move to better financial management, underscoring:
    
    
  • the Treasury Board’s oversight role on financial management and spending, and the requirement for deputy ministers to report based on the criteria outlined in the Treasury Board Secretariat’s recently released Management Accountability Framework (Page 12);
    
    
  • Treasury Board Secretariat’s role in overseeing government-wide management practices and ensuring value for money (Page 24) and
    
    
  • the enhanced role of the Comptroller General in setting reporting standards and working with departmental comptrollers to ensure that all requirements for expenditure planning, control and oversight are met, including in the development of policy proposals (Page 12).
    
  
  
• Increased accountability and transparency in the management of public resources are also reflected in the following changes:
  
  
  
  • the new requirement for Ministers, Ministers of State, Parliamentary Secretaries, and Ministers’ offices to post travel and hospitality expenses on the departmental website on a quarterly basis. This policy will also apply to Deputy Ministers (Page 37); and
    
    
  • integrated portfolio management to achieve good governance, coherent coordination of policy, legislation and programs, excellence in delivery of programs and services, and meaningful accountability to the public, through Parliament, for the activities of the full portfolio (Pages 6-8).
    
  
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  RECUSAL PROCESS FOR THE PRIME MINISTER
  
  The following recusal mechanism has been approved by the Ethics Counsellor and put into place, effective December 12, 2003.
  
  1. Areas of Recusal
  
  
  
  
  • Recusal is necessary when a decision maker could be put in a position of dealing with a matter which could represent a perceived or actual conflict of interest as outlined in the Conflict of Interest and Post-Employment Code for Public Office Holders (the “Code”).
    
    
  • The Ethics Counsellor indicated in a July 2003 letter to Paul Martin, that should he become Prime Minister, he would be required to recuse himself where the matter under consideration has a specific and direct link to Canada Steamship Lines.
    
    
    
    • He noted that matters of general impact on Canada Steamship Lines, i.e., those which impact a broad base of businesses across the economy, would not necessitate recusal.
      
    
    
  • The Ethics Counsellor has confirmed that, further to his July 2003 letter, the areas of recusal for the Prime Minister remain:
    
    
    
    • shipbuilding;
      
      
    • marine transportation policy issues; and
      
      
    • fees for the St. Lawrence Seaway.
      
    
    
  • The Ethics Counsellor has also confirmed that the activities of Canada Steamship Lines and its holdings will need to be evaluated on an ongoing basis to consider their impact on these, and possible new areas of recusal.
    
    
  • The Chair of Canada Steamship Lines has formally agreed that he will keep the Ethics Counsellor aware of corporate developments that could impact on recusal.
    
    
  • Matters related to the three areas of recusal can form part of information or decision items in the course of:
    
    
    
    • attending Cabinet or committees;
      
      
    • being briefed by officials, orally or in writing, on Cabinet or committee business, as well as with respect to policy, program and process matters; and
      
      
    • attending meetings or participating in discussions.
      
    
    
  • In light of the recusal process established for the Prime Minister, he will not be involved in decisions or receive information related to the areas of recusal. This is similar to the approach used when the Prime Minister was Minister of Finance. As a result, the Prime Minister may need to refer issues to the Deputy Prime Minister for consideration from time to time.
    
  
  2. The Administration of Recusal
  
  
  
  • Administering this recusal process involves three parties:
    
    
    
    • the Ethics Counsellor (1) - who establishes the areas of recusal, determines whether circumstances will necessitate recusal in a specific instance, and carries out all public communications with the media on these matters as required;
      
      
    • PCO officials - who have control over much of the information flowing to the Prime Minister from the Public Service through oral and written briefings or Cabinet attendance; and
      
      
    • PMO officials - who also provide information to the Prime Minister and manage his agenda and schedule meetings.
      
    
    I) Ethics Counsellor
    
    
  • The Ethics Counsellor examines the Prime Minister’s assets, liabilities and activities, and instructs him on how they are to be handled to avoid conflicts of interest. The Ethics Counsellor also continues to monitor these interests for any changes which could impact on possible conflicts of interest.
    
    
  • After instructing on the areas of recusal (initially and on an ongoing basis), the Ethics Counsellor works with the lead PCO official to assess potential areas of conflict related to the Prime Minister’s duties and responsibilities as they arise.
    
    
  • The Ethics Counsellor is responsible for:
    
    
    
    • identifying the areas of recusal, as well as any changes;
      
      
    • informing the Prime Minister, the PCO and PMO, of his decisions on how these are to be handled in general, as well as in specific instances; and
      
      
    • handling all public communication regarding conflict of interest recusal matters involving the Prime Minister.
      
    
    
    ii) PCO
    
    
  • The lead PCO official:
    
    
    
    • liaises with the Ethics Counsellor;
      
      
    • keeps other PCO officials informed of areas which could become potential conflicts of interest; and
      
      
    • advises and assists PCO officials on recusal in general and provides guidance on how to handle specific cases.
      
    
    
  • The Deputy Secretary Operations, in conjunction with Counsel to the Clerk of the Privy Council, is the lead PCO official for recusal purposes, given that most, if not all, of the instances where recusal might be required would fall within this Deputy Secretary’s areas of responsibility. These include Cabinet Committee agendas and briefing notes.
    
    
  • All PCO officials who provide written or oral advice to the Prime Minister, or who are responsible for Cabinet or committees, will be informed of the areas of recusal which apply to the Prime Minister.
    
    
    
    • Assistant Secretaries supporting committees will also need to anticipate possible conflicts well in advance so that information is not inadvertently provided to the Prime Minister.
      
    
    
  • Officials are expected to monitor their briefing notes, Cabinet and committee agendas, and Cabinet documents, as well as forward agendas to determine if they contain items which could raise matters for potential recusal.
    
    
  • Should an official identify an issue which falls within the areas of recusal, the official should raise the matter with their direct report who will then discuss it with the Assistant Secretary for the unit, who will be responsible for referring this to the PCO lead.
    
    
  • Once the matter has been referred to the PCO lead, the lead will inform the Ethics Counsellor and, as necessary, work with the Ethics Counsellor to gather additional information within PCO that the Ethics Counsellor may need to make a final determination. This process will be documented so that the decision to recuse, or not, is properly recorded.
    
    
  • If the Ethics Counsellor concludes that recusal is required, the Clerk of the Privy Council and the PCO lead will be informed.
    
    
  • The Clerk will then discuss the matter with the Prime Minister’s Chief of Staff. As necessary, each will then ensure that appropriate steps have been taken to keep the matter in question from the Prime Minister.
    
    
  • Where recusal occurs and the matter requires input and/or decision, the Clerk will refer the matter to the Deputy Prime Minister for consideration.
    
    
    
    • If the matter involves an issue before Cabinet or its committees, the Prime Minister will recuse himself and this will be recorded in the minutes of Cabinet proceedings.
      
    
    
  • Ongoing consultation with the Ethics Counsellor will take place to ensure consistent interpretation is applied to the areas of recusal.
    
    iii) PMO
    
    
  • PMO officials will follow the same recusal guidelines as PCO officials (with the Chief of Staff fulfilling the same role as the Clerk of the Privy Council), with support provided directly by the Ethics Counsellor. PMO will identify a liaison person to work with the Ethics Counsellor as issues arise.
    
    
  • In the case of PMO, particular attention will be paid to the Prime Minister’s:
    
    
    
    • political activities and engagements; and
      
      
    • meetings and phone calls.
      
    
    
  
  3. Transparency and Reporting
  
  
  
  • In order to properly support the recusal process, making a determination on whether a recusal is necessary will be documented appropriately by the Ethics Counsellor, PCO, and PMO.
    
    
  • In addition to public release of the areas of recusal and any changes which may occur over time, and description of the procedures in place to implement the recusal process, the Ethics Counsellor will provide public information in relation to specific instances where the Prime Minister has recused himself, subject to respecting Cabinet confidences and the Access to Information and Privacy Acts.
    
  
  
  The recusal process for the Prime Minister is available on the Ethics Counsellor’s website:
  
  www.strategis.ic.gc/ethics
  
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  (1) When Bill C-34 of the 2nd Session of Parliament, An Act to Amend the Parliament of Canada Act (Ethics Commissioner and Senate Ethics Officer) and other Acts in consequence, is reinstated and if it is passed by the Parliament of Canada, the Ethics Counsellor will be replaced by the Ethics Commissioner.