[Democracy Watch Logo] [Op-ed]

Loopholes and weak enforcement make Lobbying Act and Lobbyists’ Code of Conduct an ongoing joke

Set out below is an op-ed by Democracy Watch Coordinator Duff Conacher which was published in slightly different, edited form in the February 14, 2011 issue of the Hill Times

Twenty-two years after the Lobbying Act (formerly Lobbyists Registration Act) became law, and 14 years after the Lobbyists’ Code of Conduct was enacted, Cabinet ministers, government officials and the media continue to make inaccurate and deliberately misleading statements about the lobbying disclosure and ethics rules, and the strength of the enforcement system, and lobbyists continue to play secret, unethical games because of the weak enforcement system.

Yes, professor W.T. Stanbury made inaccurate claims in his article “Regulating influence of wealth on politics: comparing election finances to lobbying” (The Hill Times - Jan. 17, p. 11).

However, Treasury Board Minister Stockwell Day also makes inaccurate counter-claims in his letter about the Lobbying Act (“Former public office holders can’t lobby government for five years, Day reminds” - The Hill Times, Jan. 24, p. 9).  In fact, the Act does not prohibit “designated public office holders from lobbying the government for five years after leaving office” as Mr. Day claims, it only prohibits them from being a registered lobbyist for five years.

Similarly, Commissioner of Lobbying Karen Shepherd makes inaccurate counter-claims in her letter about the Act, which is disappointingly incredible given that she is the front-line enforcer of the Lobbying Act (“MPs, Senators cannot ‘retire and start working as professional lobbyists’” - The Hill Times, Jan. 24, p. 9).  Again, in fact, MPs and Senators can start working as lobbyists the day after they leave office, as can Cabinet ministers, their staff, Cabinet appointees, and the staff of the offices of the Leader of the Opposition in the House and Senate. The Act only prohibits them from being a registered lobbyist for five years.

To be clear, the Conflict of Interest Act does contain further restrictions for senior government officials after they leave government.  For two years Cabinet ministers, and for one year other senior staff and appointees, cannot work with or make representations on behalf people and organizations they had official, significant dealings with during their last year in office.  Consistent with her typically weak enforcement record, Ethics Commissioner Mary Dawson has not defined “official, significant dealings” so the scope of this restriction remains unclear.

Democracy Watch’s position is that other rules in the Conflict of Interest Act make it effectively illegal for senior politicians and officials to lobby or even provide strategic advice to clients after leaving public office for a much longer time period.  The Act prohibits “taking improper advantage”of one’s former office, and providing advice to clients using information learned while in office that is “not available to the public.”

Of course, former Cabinet ministers and senior officials are hired to provide advice because they have inside information that the public doesn’t know, and by selling that information they are, by definition, taking improper advantage of their former office.

However, lapdog Ethics Commissioner Mary Dawson has failed to publish interpretation bulletins or enforcement policies for these sections of the Act, and refuses to conduct random audits of the activities of former Cabinet ministers and government officials, and as a result these rules are not being enforced in any way.

Meanwhile, the Lobbying Act’s five-year ban is full of loopholes not because of lack of interpretation bulletins or weak enforcement, but simply because the Act’s definition of “registered lobbyist” is full of loopholes.  Anyone can lobby, without registering under the Act, if they are not paid to lobby.  This is a very easy loophole to exploit -- just arrange to have your client pay you for advice and other services, and lobby for them for free. 

The Act also allows anyone to lobby without being a registered lobbyist if s/he is an employee of a for-profit corporation and lobbies less than 20 percent of his/her work time every six months (ie. assuming a five-day work week, up to 25 days of lobbying every six months without being required to register).  The senior officer of the corporation is responsible for the registration, which further blurs the lines of responsibility (and, in fact, the you can be a senior officer of a for-profit corporation, and be registered as a lobbyist, and not be in violation of the five-year ban (as long as you lobby less than 20 percent of your work time every six months).

Incredibly, in her letter Commissioner Shepherd claims that this loophole does not exist, and she has an incorrect and incomplete Interpretation Bulletin on her website that fails to mention this loophole.  She claims that if the employees of a for-profit corporation collectively meet or exceed the 20 percent lobbying time threshold, then “the name of the executives and other employees performing lobbying activities must be listed in the registration” by the senior officer. 

This is the rule for other types of organizations such as unions and NGOs, but for-profit businesses only have to register employees who each spend 20 percent or more of their time lobbying.  A for-profit business can have any number of employees each lobbying 19 percent or less of their work time, and none of them are required to be registered as lobbyists.

As well, under the Act no one, not even consultant lobbyists, and no matter how much time they spend lobbying, is required to register if they are lobbying about the enforcement or administration of a law, regulation, policy or program.

Given that the RCMP and Crown prosecutors have to prove in court that you intentionally did not register, prosecutions are very unlikely, or unlikely to succeed, if they are aimed at a “free lobbying” arrangement, and/or a senior corporate officer’s “mistaken failure to register” an employee situation, or any lobbying that could be characterized as relating to enforcement.

In fact, since the Act became law in 1989, no one has been prosecuted for failing to register as a lobbyist -- no one, not even René Fugère who was clearly paid to lobby Prime Minister Chrétien for grants 12 years ago.  And Rahim Jaffer and Gilles Varin are the latest subjects of investigations, both of whom will likely not be charged because of these huge loopholes.

As well, because of these huge loopholes, it is very likely many people, including many former Conservative government officials (all of whom left the government since July 2008 when the supposed five-year ban came into force) are currently lobbying the federal government, legally, without registering.

Minister Day also states in his letter that “it is essential that all activities of those who represent Canadians in Parliament be as open and transparent as possible.”  Given this statement, it is sadly disappointing not only that the Conservatives broke their  2006 election promise to “Require ministers and senior government officials to register their contacts with lobbyists” but also that they continue to mislead the public about the ongoing secrecy loopholes.

In fact, the Conservatives have not even required registered lobbyists to disclose all of their contacts with politicians and government officials.  Only pre-arranged, oral communications are required to be disclosed, and if the government official invites the lobbyist to communicate with them, the communication does not have to be disclosed.  As well, the senior official of a corporation is listed in the registry of communications, not the actual employee who did the lobbying, and the identity of the consultant lobbyist who arranges a meeting is also kept secret.

Finally, Commissioner Shepherd claims in her letter that she is being “aggressive in fulfilling her mandate”.  Yet she refuses to conduct random audits of federal Cabinet offices and government institutions to determine who is communicating with them about their decisions, which she could do with her general enforcement powers under the Lobbying Act.  Such audits would very likely catch lobbyists who should be registered.

Commissioner Shepherd has also been on the job, including her time as Interim Commissioner, since spring 2007, and has yet to issue a ruling on five complaints alleging violations of the Lobbyists’ Code of Conduct that she inherited from her predecessor Registrar of Lobbyists Michael Nelson (the complaints were filed by Democracy Watch from 2001 and 2004). Commissioner Shepherd has also failed to issue rulings on other new complaints about violations of the Code (two of which were filed by Democracy Watch in October 2009).

In fact, because of extremely vague statements in the two annual reports she had issued, it is essentially impossible to tell whether Commissioner Shepherd is competently and effectively  investigating all complaints filed with her.  Commissioner Shepherd’s annual reports provide less detail than the reports of the recently disgraced Public Sector Integrity Commissioner, and her enforcement record is as weak.

Imagine if the police sat in their offices waiting for complaints as their method for enforcing laws about the flow of traffic (each of which contained loopholes), and then took years to investigate each complaint, and years more to lay charges and prosecute, if they ever did prosecute. 

How many speeders, red-light runners, hit-and-run and drunk drivers would be caught?  Worse, how many people would even follow driving laws?  This is the exact analogy to the loophole-filled and weak law and ethics rules and enforcement record for the flow of communication from people trying to influence the federal government for the past 22 years.

No one has to look any further than this example of sham law enforcement to understand why a larger and larger majority of Canadians lack trust in government -- if the federal government can’t ensure open and ethical lobbying, what chance is there that it will solve any societal problem?

So, will the federal parties finally do their job and work together to close these loopholes so that everyone communicating with federal government decision-makers will finally have to be open and ethical?

For more details, go to Democracy Watch's Government Ethics Campaign page