Conflict of interest guidelines: too little or too much?

• Author: Lindy Kasperski, and others

One session at the 37th Canadian Regional Conference of the Commonwealth Parliamentary Association featured a discussion of conflict of interest guidelines. The session, held on July 27, 1998 was chaired by Jocelyn Burgener MLA (Alberta). The topic was introduced by Lindy Kasperski MLA (Saskatchewan) and several members from other jurisdictions also participated. The following extracts, based on the transcript for the session, raise many interesting questions in this area.

Lindy Kasperski (Saskatchewan): Although far from an expert on this topic I will try to introduce the topic and provide some background for discussion. Let us begin with the question of definition and here I rely on a recent work by political scientists Ian Greene and David Shugarman, Honest Politics: Seeking Integrity in Canadian Public Life. They state:

A conflict of interest between public and private interests occurs when a public official is in a position to use his or her public office to gain personal benefit or benefits for his or her family or party that are not available to the general public. Conflicts of interest are unacceptable in a society that values the rule of law: the law is to be applied equally to everyone except in the case of justifiable exceptions written into the law. Moreover, public officials who use their positions to provide special benefits to themselves, their families, or their political friends undermine the principle of social equality. We expect public officials -- whether they are permanent or contracted public servants, elected representatives or senators -- to serve the public interest. Where there is a conflict between the public interest and private, family, or party interests, the public interest should always prevail.

These are general principles and there is little consensus about exactly how these principles should apply to different and individual cases. That is where the rules of ethical politics come into play. Ethical rules represent the political system's current efforts to reconcile general principles with society's expectations about appropriate behaviour of public officials.

This study on conflict of interest goes on to outline a four-tier hierarchy of conflict-of-interest violations. At the top are conflicts involving financial benefit to a public official. These traditionally have been covered by the Criminal Code.

Second in the hierarchy are conflicts without direct financial benefit to elected officials. This type of conflict of interest involves influencing decisions that benefit family, friends or business associates. If public officials fail to remove themselves from the potential conflict of interest, then they can be guilty of a real conflict of interest even if they do not receive any direct financial benefit.

The third level of conflict-of-interest violation is violation of conflict of interest guidelines without a real conflict having occurred. Most conflict-of-interest codes now in Canada require public officials to make a confidential or a public disclosure of non-personal assets and liabilities. This information enables ethics counsellors and conflict-of-interest commissioners to provide specific advice about how to avoid conflicts of interest. Failure to make full disclosure is a breach of the rules even if the assets and liabilities would not result in a conflict of interest.

Fourth in this hierarchy of violations is the apparent conflict-of-interest situation. Even when all the rules have been complied with, most conflict-of-interest guidelines state that public officials have the responsibility to show publicly that they are attempting to act impartially at all times.

Recently, public sentiment seems to expect public officials to have a duty to avoid these apparent conflicts of interest. This potential conflict of interest can become a real conflict unless the public official takes action to avoid any situation by disposing of relative assets or withdrawing from certain public duties or decisions.

Let me now give a brief background on federal and provincial conflict-of-interest rules. At the federal level the first written guidelines for cabinet ministers in this country came into effect in 1964. As of 1996 there were still no written guidelines for MPs and senators, although there has been recently considerable debate in various Commons committees, especially since 1988. These original guidelines that were developed by the Pearson government were really in effect until 1973, when public concern was raised by several allegations of conflict of interest involving federal cabinet ministers. In that year Allan MacEachen, President of the Privy Council, produced a green paper containing draft legislation designed to prevent conflicts of interest among MPs and senators, including cabinet ministers. According to this paper, all public office-holders are trustees of the public interest and if they allow their private interests to take precedence over public interests, a conflict of interest has occurred.

The recommendations of the MacEachen report focused on preventing situations in which members could derive personal financial gain from public office. However, the legislation that was recommended in this report never did materialize.

The Trudeau government used a set of written guidelines in the form of a letter to cabinet ministers which contained some specific conflict-of-interest guidelines reflecting the MacEachen report, but that was all. The guidelines provided for the disclosure of non-personal assets and the choice of either selling assets with conflict-of-interest potential or placing them in a blind trust.

In 1974 the federal government also created what is known as the OADRG - Office of Assistant Deputy Registrar General - which was created to process compliance documentation.

In 1979 the Joe Clark government broadened the guidelines to apply to spouses and dependent children of cabinet ministers. The guidelines were also made public for the first time. The application of the guidelines to spouses proved very controversial at the time and in 1980 the Trudeau government removed the applicability of the conflict-of-interest guidelines to spouses.

In 1983-84, in response to a much-publicized conflict-of-interest allegation another federal task force on ethical conduct was created, jointly chaired by Michael Starr and Mitchell Sharp. This report was one of the most comprehensive attempts at documenting a conflict-of-interest definition of its time. The report clearly stated that conflict-of-interest rules are intended to promote impartial decision-making and equality of treatment. This task force also envisaged a legislative code of ethical conduct applicable to practically all public office-holders...