The Weakest Link

John Geddes December 11 2000

The Weakest Link

John Geddes December 11 2000

The Weakest Link


John Geddes

In the fined days of the election campaign, some of Prime Minister Jean Chrétien's closest advisers were feeling angry and anxious. The polls showed the Liberals cruising to a majority, which is, of course, how things turned out on Nov. 27. There was a chance, though, that the imminent triumph might become tainted. The revelation that Chrétien had repeatedly lobbied the federal Business Development Bank of Canadas president to lend money to a hotel owner in his riding threatened to take on the smell of a full-blown scandal. As seasoned campaign strategists, members of his inner circle judged that the issue would not seriously jeopardize their reelection chances. But as old friends of Chrétien, their feelings ran much deeper—so they took pains to try to quash the developing controversy. “This was a very important part of the campaign with serious issues of principle being raised,” said one close Chrétien confidant. “But in the process, the Prime Minister has been clearly vindicated.”

How clear that vindication was, however, remains a matter of intense partisan debate. Liberals attach definitive importance to the opinion the government’s ethics counsellor, Howard Wilson, issued in the final days of the campaign. Opposition politicians dismiss those findings as far from conclusive. Wilson said Chrétien broke no rules when he lobbied the bank in 1996 and 1997 for a $615,000 loan to Yvon Duhaime, an old business acquaintance and owner of the Auberge Grand-Mère in his home riding of Saint-Maurice, Que. But critics argue Wilson could hardly have found otherwise, since

there are no explicit rules governing dealings between cabinet ministers, including the Prime Minister, and such Crown corporations. And because Wilson reports direcdy to Chrétien, he is ffequendy derided as more a lapdog than a watchdog. But he vows that the review he has promised on the fallout from the case will be no whitewash. “I take this seriously,” Wilson told Macleans in an interview “There have been important points raised in the debate over the past few weeks.”

The possibility of a close look at the ethics rules guiding MPs and cabinet ministers—or lack of them—could be one of the few real policy spinoffs from a campaign widely decried as thin on substance. In the aftermath of last week’s decisive Liberal victory, most of the soul-searching in the losing parties was not over platforms, but on tactics and leadership. Bob Runciman, the prominent Ontario Conservative who was co-chairman of the Canadian Alliance’s disastrous campaign in the province, even suggested another new party of the right might have to be created—likely without Stockwell Day as leader. But Day vowed to stick around to fight the next election, and blamed his failure to score a breakthrough in Ontario on scaremongering by the Liberals over the Alliance’s plans for health care and seniors’ benefits. As for Chrétien, radiating satisfaction with the result, he was hardly in a mood to concede any need to rethink his governing style. “We won,” he said at a news conference. “We won big.”

Yet the energy Chrétiens top advisers put into trying to quiet the uproar over his riding activities suggested that they saw the

Chretien won big, but the question of ethics may return to haunt him

ethics issue as more than a passing concern. To some Liberal insiders, government ethics is regarded as the weakest link in his political legacy. The powerful performance of the Canadian economy under Chrétiens watch, along with the transition from deep federal deficits to soaring surpluses, has secured—with a little help from Finance Minister Paul Martin—his claim to being a successful economic manager. Accomplishments like the Canada Child Tax Benefit and this falls agreement with the provinces to ramp up health spending give him grounds to claim a solid social-policy record.

But on “governing with integrity”—as the ethics agenda was called back when he was bidding for his first mandate in 1993—Chrétiens record is cloudy. Seven years ago, the Liberals promised that the new ethics counsellor would report to Parliament; instead Wilson answers direcdy to the PM. The party pledged to draft a code of conduct for MPs and cabinet ministers; it was never delivered. And there was no renewal of the ethics theme—in fact, barely any mention of it—in the Liberals’ slim platform for this fall’s campaign.

Instead of taking the initiative on ethics, the government has fallen into a pattern of reacting to trouble—from the scandal over job-creation spending at Human Resources Development to repeated flare-ups over grants and loans flowing into Chrétiens riding. At the core of the controversies are often questions about the proper role of members of Parliament, especially MPs who make it into cabinet. Clear rules are in place for only narrow circumstances. Cabinet ministers are forbidden, for instance, from trying to influence the decisions of quasi-judicial federal agencies, such as the Canadian Radiotelevision and Telecommunications Commission in issuing lucrative broadcasting licences, or the Immigration and Refugee Board in deciding who gets to stay in Canada.

Those limits were imposed only in 1994, after Michel Dupuy, then Canadian heritage minister, wrote to the CRTC, an agency under his department’s control, on behalf of an applicant for a TV licence. Wilson says the resulting strict prohibition on helping constituents get what they want from quasi-judicial boards remains a hard pill to swallow for some cabinet ministers. Most are longtime MPs before they get the big promotion, and many have routinely helped out constituents. They find it politically awkward to end that sort of local involvement—and are often proud of the expertise their staffs have in working with quasijudicial processes. “They view it as terribly important,” Wilson explained. “In one case, I was telling a new secretary of state that he couldn’t deal with a CRTC issue, and he was hearing back from his constituent, ‘Oh, now that you’re a minister, you’re too good for us.’ ”

But while ministers have had to back off from quasijudicial matters, they are still allowed to support constituents who are dealing with other arms of government. The only limits on what a cabinet minister, including the Prime Minister, can do are those laid out in what is called the Conflict

of Interest and Post-Employment Code for Public Office Holders. Its main thrust is to prohibit government officials from getting mixed up in cases where they have a direct financial conflict. That was a question raised concerning Chrétiens lobbying of the Business Development Bank on behalf of Duhaime’s Auberge Grand-Mère. The Prime Minister had owned a share in a golf course next to the inn. Wilson ruled that Chrétien had sold his stake in 1993, although the question of when he ceased to have a financial interest is complicated by the fact that he was not actually paid until 1999.

Chrétiens closest advisers are irate over suggestions that he stood to gain personally. They stress that he has always put enormous stock in what he sees as a duty to directly intervene on behalf of constituents in his Saint-Maurice riding, where

he was first elected in 1963. “A lot of politicians, when they are elected, leave their riding and don’t represent it,” said one old friend. “He is passionate about his riding. He is going to go back there when he retires. It was the most normal thing in the world for him to make this representation.”

But can that sense of obligation to constituents be squared with the clout a cabinet minister or prime minister has with federal agencies? The conflict of interest code states that “public office holders shall not step out of their official roles to assist private entities or persons in their dealings with the government where this would result in preferential treatment to any person.” Wilson said that rule cannot be allowed to trump what he views as the fundamental job of an MP, even one who serves in cabinet, to represent a constituency. But he admits there is “a tension” between the two principles. “I’m hoping that we can find a fine balance,” Wilson said, adding he doubts rules as sweeping as the one forbidding contact with quasi-judicial agencies

Instead of taking the initiative on ethics, Ottawa reacts to trouble

will be extended to other types of federal government bodies.

Yet curtailing the role of MPs is already a key part of the governments response to perhaps its most damaging controversy this year. In the aftermath of the outcry over massive misspending in the human resources development department, the practice of involving MPs in decisions to allocate job-creation grants to companies and nonprofit groups in their ridings was singled out as a major problem. “I think this was a way that has led to difficulties,” admitted International Trade Minister Pierre Pettigrew, a former human resources minister, “and we have changed it and the MPs are no longer consulted.” It took a sustained uproar to separate MPs from their influence over that job-creation spending. Now, the question is whether Wilson’s review might lead to a wider move to further untangle the duties of MPs to their constituents from the influence those same politicians often wield when it comes to who gets government money. After a campaign generally seen as light on substance, this is one election issue that could lead to real reform—and is at least bound to keep generating fierce debate. E¡3