The new Lobbyists' Code of Conduct, which was presented to MPs at committee on Monday, will further prohibit lobbyists activities and interactions with public officials, but makes no direct mention of “friends.”
Lobbying Commissioner Karen Shepherd appeared Monday at the House of Commons Standing Committee on Access to Information, Privacy and Ethics to speak on the Main Estimates 2015-16.
The commissioner used the opportunity before committee, likely her last appearance there before the House rises at the end of June, to present her new code for lobbyists.
Shepherd began consultations in 2013 to see if there was a need for changes to the Lobbyists' Code of Conduct. In 2014, her office put out a revised code and undertook more consultations to get feedback from stakeholders on the changes.
Shepherd said there are three major changes to the ethical rules for lobbyists. The code has been changed to be more consistent with the Lobbying Act and all mentions of the interaction between lobbyists and their clients have been removed, since the code is meant to govern relationships between lobbyists and public office holders; a new principle stating that lobbyists should act in a manner that shows respect for Canada's democratic institutions was added to reflect the role lobbyists play in the public policy process; and changes were made to clarify conflict of interest rules to align with the 2009 Federal Court of Appeal judgment in Democracy Watch v. Campbell in 2009, which said that no conflict of interest is acceptable.
New rules were added to clarify issues around preferential access, conflict of interest and obligation; political activities; and hospitality and gifts in line with the court ruling.
Regarding preferential access, Shepherd removed all references to the word “friend,” which had been in an earlier version of the code. The addition of the concept of "friend" without a definition created a lot of controversy and confusion among the lobbying community.
Instead, Shepherd's new code focuses on relationships that could reasonably be seen to create a sense of obligation because of a close, personal relationship between the lobbyist and public office holder.
Relationships created through financial or business dealings, if the lobbyist is a relative of the public office holder, or if they are close, personal friends could all be seen to create a sense of obligation, Shepherd said during her appearance at committee.
Liberal MP and critic for open government and ethics Scott Simms raised concerns at committee over the prohibition on lobbying public office holders with whom the lobbyist shares a close relationship.
“This town is not that big,” Simms said of Ottawa. “We tend to see each other in social settings.”
Shepherd responded to Simms concerns about a chill over lobbying activities and said she agreed that she doesn't want to stop good public policy, and that nobody wants government operating in a vacuum.
Lobbying law expert Guy Giorno, a partner at Fasken Martineau and former PMO chief of staff, said in a report to clients on Tuesday on the new rules that the “sense of obligation” test is the most significant change to the code of conduct.
“The Lobbying Commissioner has embraced the Court of Appeal ruling and, through the new Code, she will prohibit any lobbying of an official whom a reasonable person believes would feel a sense of obligation to the lobbyist,” Giorno said.
The new rules also aim to clarify which political activities undertaken by lobbyists would put a public office holder in a real or apparent conflict.
“The code will explicitly prohibit lobbyists from lobbying members of Parliament and ministers when they have carried out political activities that could reasonably be seen to create a sense of obligation,” Shepherd said in her opening remarks. The ban would be for a “specified period,” according to the code, which has yet to be determined.
The political activities that Shepherd said would result in the lobbyist being prohibited from lobbying a public office older include organizing a fundraising campaign or event, writing speeches, preparing candidates for debates, and serving on the executive of an electoral district association.
This prohibition in the new code goes a step further to restrict lobbyists from lobbying staff who work in the minister or MP's office if the lobbyist conducted political activities to help the member get elected.
“When certain political activities are carried out by lobbyists, it is reasonable to think that political staffers who serve at the pleasure of the member or minister may also feel a sense of obligation,” Shepherd said.
Shepherd also clarified political activities that would not create a sense of obligation, such as making a donation, putting up a lawn sign, being a member of an electoral district association or attending fundraising events.
The Government Relations Institute of Canada (GRIC) and the Public Affairs Association of Canada (PAAC) jointly responded to the new code in a release on Monday.
“GRIC and PAAC are encouraged generally that the Revised Code brings a measure of clarity and consistency to some areas that were addressed by stakeholders in this process,” the release said.
“At the same time, we expect to hear concerns from our members with respect to the Revised Code's cynical treatment of participation by public office holders in charitable and community events (suggesting that the judgment of MPs and Public Office Holders cannot be trusted if they accept a ticket to a dinner or lunch event).”
The Lobbyists' Code of Conduct is set out in the Lobbying Act as a set of rules and ethical guidelines for registered federal lobbyists to follow. There are no monetary or legal penalties associated with breaching the code, but the commissioner can make a public report to Parliament, naming and shaming lobbyists who break the rules.
Shepherd told The Lobby Monitor after committee that even though the new code may not come into effect for several months, the 1997 version of the code is the rule that currently stands and the guidance her office has published on the website should act as a good guide for anyone with questions before the election.
“The guidance that's out there for now for lobbyists still stands,” Shepherd said. “And really, the only thing that's happening with the new code is there's some new rules, but a lot of it is to clarify what's actually in the guidance.”
Shepherd said her office will use the summer months to work on further guidance and educational tools for lobbyists to help them comply with the new code, and plans to have the new code go through the Gazetting process in late fall.
The Lobbyists' Code of Conduct has never been amended since it came into effect in 1997.
Shepherd said she will consider hosting cross-country roundtable discussions with lobbyists to further educate them about the requirements of the new code and that she may create an annotated code as part of tools and guidance her office will work on over the summer months.
“Lobbyists very much want to comply with the act and the code, so I feel that it's my job to ensure that they have the necessary guidance and tools in order to be able to do that,” Shepherd said.
Lobbyist gifting banned
The new code bans all lobbyist gifting, except those gifts that are a “normal expression of courtesy or protocol.”
The new rule prohibits lobbyists from giving gifts to public office holders, whether the lobbyist has lobbied that person, or not.
Shepherd said this additional rule on gifts is more for the occasional lobbyist than the professional, full-time consultants who are already familiar with what public office holders are allowed to accept.
“Rather than getting into what public office holders can accept, saying 'no gifts' makes it a lot easier,” Shepherd said.
Expressions of courtesy and protocol include accepting a meal during an event that takes place over a mealtime, Shepherd said. She also said she doesn't see public office holders attending parliamentary receptions as creating a sense of obligation to that lobbyist or group who hosted the event if those events are open and all MPs are invited.
Shepherd investigating Duffy's meetings with lobbyists
At committee, Shepherd confirmed that her office is investigating the activities of the lobbyists mentioned in former Conservative senator Mike Duffy's personal diaries from his time as a senator, which were made public through the criminal trial where Duffy is facing 31 counts of fraud and breach of trust.
Duffy kept a detailed record of conversations and events in his calendar, and his private schedule between 2009 and the end of 2012. Duffy listed meetings, meals and phone calls with a wide variety of individual lobbyists who have worked or work for corporations and government relations firms.
The lobbying commissioner conducts her investigations in private and cannot discuss details publicly regarding the parties being investigated or the nature and scope of the investigation, but Shepherd said the allegations came to her attention this year through media reports and that her office takes all allegations seriously.
At committee, NDP MP Charmaine Borg asked Shepherd if there was a legislative loophole that needed closing with respect to the 20-per-cent rule that might have led lobbyists to engage in unregistered activity with Duffy.
In-house lobbyists only need to register with the federal lobbyists' registry if they meet the “significant part of duties” test. This rule permits in-house corporation or association staff to lobby without registering, so long as the activities constitute less than 20 per cent of the person’s duties.
Shepherd said Monday, as she has said in past committee meetings during the review of the Lobbying Act, that this rule is difficult to calculate and enforce and she recommended it be removed.
Treasury Board President Tony Clement, whose department is responsible for changes to the act, has suggested his department is looking into the recommendation, along with others, although no action has been taken.
Shepherd said at committee that while registered lobbyists are usually not required to file a monthly communication report if the public office holder initiated the conversation, a lobbyist would still be required to file a report if there is a financial benefit to be gained by the lobbyist or the lobbyist's client.
CORRECTION: An earlier version of this story incorrectly stated that an individual would be required to file a monthly communication report even if an initial registration is not required, if there is a financial benefit to be gained by a communication with government, regarless of who initiated the communication. This is not the case. The Lobbying Act only requires those who file an initial registration to file monthly communication reports.
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