New Brunswick Conflict of Interest Commissioner
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Annual Report 2000-2001

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Province of New Brunswick




CONFLICT OF
INTEREST COMMISSIONER




The Honourable Stuart G. Stratton, Q.C.



ANNUAL REPORT

2000-2001





Letter of Transmittal
Report





  May 4, 2001

The Honourable Bev Harrison
Speaker of the Legislative Assembly
Room 31, Legislative Building
Fredericton, New Brunswick
E3B 5H1

Dear Mr. Speaker:

I have the honour of submitting this, the First Annual Report of the Office of the Commissioner under the Members' Conflict of Interest Act, for the period May 1, 2000 to April 30, 2001.

This report is submitted pursuant to section 31 of the Members' Conflict of Interest Act, R.S.N.B. 1973, c. M-7.01.

Respectfully submitted,

The Honourable Stuart G. Stratton Q.C.
Conflict of Interest Commissioner for the
Province of New Brunswick







THE FIRST YEAR IN REVIEW
The Office of the Conflict of Interest Commissioner opened on May 1, 2000. The Commission is located in the former Office of the Lieutenant-Governor in Edgecombe House at 736 King Street in Fredericton, New Brunswick.

In this, the First Annual Report of the Office of the Commissioner under the Members' Conflict of Interest Act (the Act), it may be of interest to the reader to record here the sequence of events and circumstances which led to the enactment of the present legislation and to set out some of the principal requirements to be met by the Members of the Legislature under the present Act.

Historically, there has been a Conflict of Interest Act in New Brunswick since 1978. This Act applied to all Members of the Legislature and to Deputy Ministers, executive staff members and heads of Crown corporations. By its terms, this Act required all of these individuals to disclose their assets and liabilities by the filing of sworn declarations with a designated judge of The Court of Queen's Bench. Indeed, this Act continues in effect but no longer has application to the Members of the Legislative Assembly.

In the years that followed the enactment of the first Conflict of Interest Act, I think it fair to say that the public came to view politicians with a great deal of cynicism and distrust. Certainly some members of the public firmly believed that some politicians were putting their private interests ahead of their public duties and responsibilities. In an effort to counteract this cynicism and belief, some of the provinces of Canada enacted legislation dealing solely with the Members of their legislatures. This new legislation required the Members of their legislatures to disclose their assets and liabilities to an independent Commissioner (in some jurisdictions called an "Integrity Commissioner" and in others a "Conflict of Interest Commissioner") and to abide by certain rules or standards of conduct.

In New Brunswick, in 1997, the Legislature retained a retired Court of Queen's Bench judge, The Honourable W.L.M. Creaghan, to assess the adequacy and effectiveness of the existing Conflict of Interest Act and, when doing so, to consider conflict of interest legislation or codes in other jurisdictions. Justice Creaghan's report of his assessment and review of the legislation in other provinces was then referred by the Legislature to the Legislative Administration Committee. This Committee recommended that new legislation be put in place. As a result, on March 12, 1999, the New Brunswick Legislature enacted the Members' Conflict of Interest Act, R.S.N.B. 1973, c. M-7.01. This Act was proclaimed to come into effect May 1, 2000. On February 1, 2000, I was appointed by the Legislature to be the Commissioner to administer the Act. My appointment was for the term of five (5) years.

I turn now to highlight some of the more important provisions of the Member's Conflict of Interest Act. Before doing so, I should perhaps state that the purpose behind the enactment of this legislation, as I understand it, is to set out acceptable standards of conduct for elected Members of the Legislature in order to ensure that the private interests of those individuals do not come into conflict with the performance of their public duties. In short, the Members of the New Brunswick Legislature must not allow their private financial interests to influence the conduct of public business.

The Act defines "conflict of interest" in these terms (s. 4):
A member shall not make a decision or participate in making a decision in the execution of his or her office if the member knows or reasonably should know that in the making of the decision there is the opportunity to further the member's private interest or to further another person's private interest.

The hallmark of the New Brunswick Act is that full disclosure is now an accepted and necessary requirement for service in public office in this province. What is required to be disclosed is defined in the Act as follows (s. 18(4)(a)):
[A] statement of the nature of the assets, liabilities and financial and business interests of the member and, so far as is known by the member, of the member's spouse and minor children, and of private corporations controlled by the member, the member's spouse and minor children, or any of them ... .

In addition, a Member must disclose any salary, financial assistance or other benefit the Member has received from a registered political party or a registered district association (s. 18(4)(b)). Also, a Member must disclose any fee, gift or personal benefit greater than $250.00 in value that is connected directly or indirectly with the performance of the Member's duties of office (s. 8).

There are other important provisions of the Act of which a Member must be aware. One such provision precludes the use by a Member of insider information (s. 5). Another section precludes the use of a Member's office to seek to influence a decision made by another person so as to further the Member's private interest or to further another person's private interest (s. 6). Both of these sections were considered during an investigation by this office resulting from a request by a Member who asserted an alleged breach of the Act by a member of the Executive Council.

It should be noted that the Members' Conflict of Interest Act specifies the procedure to be followed in dealing with potential conflict of interest situations. Section 13 of the Act provides for both withdrawal or recusal from proceedings, and disclosure. It states that during a proceeding, any Member who has reasonable grounds to believe that he or she has a conflict of interest in a matter that is before the Assembly, or the Executive Council, or a committee of either of them, must disclose the general nature of the conflict of interest and withdraw from the meeting without voting or participating in the consideration of the matter.

Subsection 36(1) of the Act is of particular importance to members of the public as well as Members of the Legislature. That section permits "any person" to request the Commissioner to investigate an alleged breach of the Act by a Member. A request for an investigation must be in the form of an affidavit setting out the grounds for the belief and the nature of the alleged breach (s. 36(2)). Upon receipt of a request, the Act authorizes the Commissioner to conduct an investigation with or without conducting an inquiry (s. 37(1)). Once an investigation is completed, the Commissioner is required to report to the Speaker and to the Member who is the subject of the investigation (s. 40(1)).

The Act also provides for penalties. If any of the Private Disclosure Statement forms required by the Commissioner are not filed within the time provided by the Act, or if a Member fails to disclose relevant information in his or her statements, the Commissioner may recommend to the Legislature as a penalty a reprimand, a fine, a suspension or expulsion from the Legislature (s. 41(1)).

It should be noted too, that the Members' Conflict of Interest Act sets stringent requirements for members of the Executive Council. Subsection 14(1) of the Act provides that Cabinet Ministers shall not:
(a) engage in any trade, occupation or employment, or in the practice of any profession, (b) engage in the management of a business carried on by a corporation, (c) carry on business through a partnership or sole proprietorship, (d) hold or trade in securities, stocks, futures or commodities, or (e) hold an office or directorship, unless holding the office or directorship is one of the member's duties as a member of the Executive Council.

Finally, other important sections of the Act prohibit Members from contracting with the Crown (s. 9); or being employed by the Crown (s. 11). Also, former members of the Executive Council must not contract with the Crown or make representations with respect to any such contract for twelve months after he or she has ceased to hold office as a member of the Executive Council (s. 17). The Act also specifies the information to be disclosed in the Public Disclosure Statement filed by the Commissioner with the Clerk of the Legislative Assembly (s. 20(2)), which is then made available to the public.

PROGRESS AND ACTIVITIES OF THE OFFICE
Subsection 31(1) of the Members' Conflict of Interest Act mandates that the Commissioner "shall in each year submit to the Speaker an annual report describing the progress and activities of the Commissioner in the previous year".

In this, the First Annual Report of the Commissioner, I wish at the outset to record my appreciation and thanks to Mrs. Loredana Catalli Sonier, the Clerk of the Legislative Assembly, and to Ms. Gisèle Osborne, Executive Officer in the Clerk's Office, for their tremendous support and assistance to me as I undertook the duties of this office.

Upon my arrival, Mrs. Catalli Sonier provided me with a comprehensive orientation manual containing the background material leading to the enactment of the new Members' Conflict of Interest Act. In addition, Mrs. Catalli Sonier prepared and submitted draft copies of disclosure documents to be completed by the Members of the Legislature. These documents were subsequently finalized and circulated to all Members of the Legislative Assembly.

Ms. Osborne, for her part, assisted in the preparation of the disclosure documents, arranged the appointments for interviews with the Members, organized a filing system and generally assisted me in setting up the Commissioner's Office.

These two individuals, together with the assistance and co-operation of other members of the legislative staff, made it possible for the Members of the Legislature and the Commissioner to complete a successful first year of operation.

I should also record that last fall, Mr. Shayne Davies, LLB, joined the staff of the Office of the Clerk of the Legislative Assembly as a Committee Clerk - Research Assistant. One of Mr. Davies' duties in this position is to assist in the management, administration and operation of the Office of the Conflict of Interest Commissioner.

Following the circulation of the required private disclosure documents to all Members of the Legislative Assembly, I met with the members of the Conservative and Liberal Caucuses to discuss and explain these documents to them. I also met personally with Ms. Elizabeth Weir, the Leader of the New Democratic Party. Subsequently, all Members filed their disclosure documents with me and I met with each of them to ensure that adequate disclosure had been made and to provide advice on the Member's obligations under the Act. In all cases, the Members were forthcoming and co-operative with me and appeared to me to be aware of their duties and responsibilities under the Act.

In writing this report, I must, however, record my concern that some Members were late in filing their disclosure documents. Moreover, many of those who filed in time did so just before the expiry of the statutory period of sixty days allowed by the Act. This lead to a delay in the completion of my interviews with the Members and in the filing of Public Disclosure Statements with the Clerk of the Legislative Assembly. This is a situation that I trust will not be repeated in future years.

Much of my time since the filing of Public Disclosure Statements with the Clerk has been taken up with the drafting of revised private disclosure documents. I should perhaps note here that the Act requires the filing of Disclosure Statements on an annual basis. In any event, a complete revision of the disclosure documents required of new Members has been concluded. In addition, in order to simplify and expedite the process, new short form Disclosure Statements have been prepared for use by continuing Members of the House who previously completed their initial documentation.

An interesting issue that arose during the year under review and alluded to earlier in this report, was the investigation of an allegation by a Member of the Legislative Assembly that the Minister of Transportation may have used insider information to further the Minister's private interest in violation of section 5 of the Members' Conflict of Interest Act. The issue arose as the result of a letter sent by the Chairman of the Minister's Fundraising Committee to a number of businesses and individuals across the province, including Members and Associate Members of the Road Builders' Association of New Brunswick. The letter in question solicited donations for the Minister's Constituency Association to help the Minister, as stated in the letter, "prepare for future elections."

Following an investigation of the matter, I reported to the Speaker on December 5, 2000, that the assertion by the Member that the Minister had breached section 5 of the Act had not been established. During the course of my investigation, however, I raised the question whether section 6 of the Act might have application to the facts as established. That section deals with the issue of influence and prohibits a Member from using his or her office to seek to influence a decision made by another person so as to further the Member's private interest.

After receiving the submissions of the parties with respect to the application of section 6 to the established facts, I concluded and in my report to the Speaker stated that there was a "political interest," i.e. fundraising for Members of all political parties, rather than a "private interest" involved in the case and that section 6 did not have application in this instance. This notwithstanding, I expressed the opinion that the solicitation of political donations by the Minister of Transportation from the Members and Associate Members of the Road Builders' Association, a specific and important group doing major work for the Department, was conduct that ought not to be repeated.

In a Bulletin circulated to all Members of the Legislative Assembly in May 2000, I stressed the advisory role of the Commissioner under the Act. Indeed, section 29 of the Act expressly authorizes the Commissioner to give advice and recommendations of general application to Members or former Members respecting their obligations under the Act. Section 30 of the Act goes even further. That section permits a Member or former Member to seek the written advice of the Commissioner on any matter respecting the Members' obligations under the Act. If a member provides all relevant details to the Commissioner and follows the advice of the Commissioner, that Member is protected from any actions under the Act relating to the matter in question.

I would report that during my first term in office, in all of my discussions with the Members, I have stressed the fact that I was available to assist them in any way I could to ensure that they avoided any conflicts of interest as they went about the province carrying out their duties and responsibilities as Members of the Legislature of New Brunswick. To this end, I have given oral and written advice to the Members on a number of topics.

Finally, my only regret during my first year in office is that a sudden illness prevented me from attending the Annual Meeting of the Canadian Conflict of Interest Commissioners, (CCOIN), which was held in St. John's, Newfoundland, in September 2000. I had made all of the necessary arrangements to attend this informative and valuable gathering and was deeply disappointed when I was hospitalized and unable to attend.

During the fiscal period which ended March 31, 2001, the expenditures of the Commissioner's Office for salaries and benefits, office equipment and supplies totalled $85,775.93. I end this report by again expressing my appreciation and gratitude for the support and assistance so pleasantly provided to me by the Clerk of the Legislative Assembly and her staff, and for the co-operation and constructive relationship which existed with all Members of the Legislature.

Dated at Fredericton, New Brunswick this 4th day of May 2001.

The Honourable Stuart G. Stratton Q.C.
Conflict of Interest Commissioner for the
Province of New Brunswick



Office of the Integrity Commissioner
Edgecombe House, 736 King Street
Fredericton, N.B. CANADA E3B 5H1
tel.: 506-457-7890
fax: 506-444-5224
e-mail:coi@gnb.ca

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