|New Brunswick Conflict of Interest Commissioner
Conflict of Interest Bulletins
Issue No.2 - June 2001
To: Members of the Legislative Assembly
From: Hon. Stuart G. Stratton, Q.C.
One of the general duties assigned to the Commissioner under the Members' Conflict of Interest Act is to promote the understanding by the Members of their obligations under the Act. In furtherance of this duty, the Act provides that the Commissioner shall prepare and disseminate to the Members written information concerning Disclosure Statements. That is the purpose of this second bulletin.
As an aside, you may be interested to learn that the first bulletin, which was sent by our office to all Members of the Legislature in May of last year, is to be published nationally, in a slightly different format, in a forth coming issue of the Canadian Parliamentary Review.
May I begin this second bulletin by reminding all Members of the New Brunswick Legislature that the public expects persons in public life to observe the highest possible standard of conduct. Members must therefore always so conduct themselves as to ensure that their private interests do not come into conflict with the performance of their public duties. To this end, the New Brunswick Legislature has enacted the Members' Conflict of Interest Act. This Act sets out acceptable standards of conduct for all elected Members and reiterates the basic principle that the Members of the Legislative Assembly must not allow their private financial interests to influence the conduct of public business.
Disclosure is one mechanism by which the public may be assured that efforts are taken to ensure that actions in the public interest are paramount and that no Member uses his or her public office to the Member's personal benefit. In furtherance of this objective, the Members' Conflict of Interest Act outlines a number of obligations on Members. Principle among them is the obligation to fully disclose their assets, liabilities and business interests to an independent Commissioner. In this respect, section 18 of the Act requires all Members of the Legislature to file an annual "Private Disclosure Statement" with the Commissioner. Subsection 18(4) dictates what must be disclosed in the Statement. To quote from the Act, a Private Disclosure Statement must contain:
(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 .... .
Subsection 18(4) also requires a Member to disclose "any salary, financial assistance or other benefit the Member has received from a registered political party or a registered district association".
But not every asset owned by a Member is required to be disclosed in a Private Disclosure Statement. Some assets are exempt from disclosure. Pursuant to subsection 18(5) of the Act, these exempt items include the Member's primary residence; primary recreational property; automobiles owned or controlled by the Member, the Member's spouse or minor children; items of domestic, household or personal use or ownership, including cash, non-convertible bonds, trust and bank certificates, registered retirement savings plans which are not self-administered and any property placed in a blind trust.
It should also be noted that subsection 18(6) of the Act provides for a meeting of the Member with the Commissioner. Thus, after a Private Disclosure Statement has been filed with the Commissioner, the Act directs that "the Commissioner shall consult with the Member and the Member's spouse, if available, to ensure that adequate disclosure has been made and to provide advice on the Member's obligations under this Act."
In addition to the Public Disclosure Statement referred to above, the Member's Conflict of Interest Act requires the completion of three additional disclosure documents. The first of these pertains to gifts. In this respect, subsection 8(1) provides that a Member shall not accept a fee, gift or personal benefit that is "connected directly or indirectly with the performance of the Member's duties of office." This restriction does not apply, however, in respect of gifts or personal benefits that are received "as an incident of the protocol or social obligation that normally accompany the responsibilities of office." Where, however, these latter types of gifts or benefits exceed $250.00 in value, or the total received from any one source in any twelve month period is greater than $250.00, the Member must file a "Gift Disclosure Statement" with the Commissioner without delay indicating "the nature of the gift or personal benefit, its source and the circumstances under which it was given and accepted."
The second of the additional disclosure documents required to be filed with the Commissioner is entitled a "Private Corporation Statement". This Statement, which deals with the assets, liabilities and financial interests of private corporations, need only be filed by those Members, who alone or with the members of their family, control private corporations.
The third of the additional disclosure documents is entitled a "Statement of Material Change". Pursuant to subsection 18(7) of the Act, if there is a change in the assets, liabilities or financial or business interests of a Member, or his or her spouse or minor children, or by any private corporation controlled by any of them, which would reasonably be expected to have a significant effect on the information previously disclosed, the Member must file a Statement of Material Change with the Commissioner within thirty days of any such change.
These then are the documents which a Member is required to complete and file with the Commissioner within 60 days of becoming a Member, and in each subsequent year at the time specified by the Commissioner. Should a Member fail to file a Private Disclosure Statement within the period of time prescribed by the Act, the Commissioner must, subsequent to one written reminder, inform the Speaker of the Member's default. The Speaker must then table the Commissioner's report before the Assembly.
After the Commissioner has received and reviewed the Member's Private Disclosure Statement and any other documents required by the Act to be filed with him, and following the Commissioner's meeting with the Member, the Commissioner must prepare a Public Disclosure Statement for each Member. Pursuant to section 20 of the Act, this Public Disclosure Statement shall, subject to some exceptions, "state the source and nature, but not the value of the assets, liabilities, and financial and business interests" of each Member as well as "any salary, financial assistance or other benefit the Member has received from a registered political party or a registered district association during the preceding twelve months" and any gift or benefit that has been disclosed.
But, as noted above, there are exceptions to what must be disclosed in the Commissioner's Public Disclosure Statement. Excluded are:
(i) any asset or liability worth less than $2500.00; (ii) any interest in a pension plan, employee benefit plan, annuity or life insurance policy; (iii) any interest in an open-ended mutual fund that has broadly based investments not limited to one industry or one sector of the economy; and (iv) any other asset, liability or financial or business interest that the Commissioner approves for exclusion.
The Act requires the Commissioner to file the Public Disclosure Statement with the Clerk of the Legislative Assembly who "shall make each Public Disclosure Statement available for public inspection". Although not required by the Act, Members are given an opportunity to review the Public Disclosure Statements before those documents are filed for public viewing at the Clerk's Office.
Subsection 41(1) of the Act is also important in connection with the filing of documents with the Commissioner. This subsection provides that the failure to file a Private Disclosure Statement, a Gift Disclosure Statement or a Statement of Material Change within the time provided by the Act can lead to serious consequences including a reprimand, a monetary penalty, suspension from the Assembly or expulsion.
While not specifically dealing with the disclosure documentation required by the Act, other provisions of the Act are also important and bear repeating. These other sections provide that Members may not:
(i) use insider information to their benefit; (ii) use the influence of their office to obtain a decision to further their private interests; (iii) be a party to a contract with the Crown under which the Member receives a benefit; or (iv) be employed by the Crown in right of Canada or in right of New Brunswick.
It is to be observed that other sections of the Act deal specifically with members of the Executive Council. For example, section 14 of the Act provides that a member of the Executive Council shall not:
(i) engage in any employment or in the practice of a profession; (ii) carry on a business; (iii) hold or trade in securities, stocks, futures or commodities; or (iv) 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.
Additional sections of the Act of which all Members should be aware provide for investigations and inquiries by the Commissioner. Specifically section 36 of the Act states that any person may request an investigation into allegations of a breach of the Act. Such requests must be in the form of an affidavit setting out the grounds and the nature of the alleged breach. In addition, the Assembly may, by resolution, request the Commissioner to investigate an alleged breach of the Act by a Member.
On receipt of a request for an investigation, the Commissioner must review the matter and decide whether or not there is jurisdiction under the Act. If there is jurisdiction, the Commissioner must then decide whether to conduct an investigation with or without conducting a formal inquiry. The Member against whom an allegation is made must be given reasonable notice of any investigation and be given an opportunity to respond to the allegation.
If the Commissioner is of the opinion that the request is frivolous, vexatious or not made in good faith, or that there are no grounds or insufficient grounds for an investigation, the Commissioner may refuse to conduct an investigation, or may cease the investigation.
Following an investigation, the Commissioner's Report is filed with the Speaker who must lay the Report before the Assembly. The Assembly may either accept or reject the findings of the Commissioner or substitute its own findings and may vary the recommended sanction or impose no sanction. The sanctions that may be recommended range from a reprimand to expulsion from the House. The Commissioner may also recommend no sanction if the breach that occurred was trivial or committed through inadvertence or an error in judgment made in good faith.
A final note. This year, because the Members have previously filed disclosure documents with this office, we have prepared and will be circulating "Short Form Private Disclosure Statements" to all Members of the Legislature. These short forms can, in the main, be completed by simply checking "yes" or "no" to most of the questions asked and required to be answered to comply with the provisions of the Act. If, when completing this new form, you have any questions or encounter any difficulty, please contact our office.