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Bill-C2 Analysis

The federal government has passed Bill C-2, (the so-called “Federal Accountability Act” (FAA)), a long overdue bill that closes some loopholes in the federal government’s accountability system.

The federal Conservatives promised during the 2006 federal election to introduce an Accountability Act containing 52 measures, but when Prime Minister Stephen Harper and Treasury Board minister John Baird introduced Bill C-2 in April 2006, the bill only contained 30 measures and cut key federal ethics rules for the Prime Minister, Cabinet ministers, their staff and senior government officials.  To see the ethics complaint that Democracy Watch has filed about Harper and Baird being dishonest by breaking their election promises and claiming that they have kept their promises, go to: Democracy Watch’s December 12, 2006 news release

Because the federal Conservatives failed to include many promised measures in Bill C-2 and also used Bill C-2 to weaken federal ethics rules, and also because no government in Canada has ever promised to close some of the loopholes set out below (let alone actually closed them), 85 undemocratic loopholes will continue to fatally undermine the federal government’s accountability and policy-making systems.  To see a summary of these loopholes, and a detailed report on the loopholes, click here.

Of the 30 measures included in Bill C-2, 25 were taken directly from the proposals advocated by Democracy Watch and its campaigns and coalitions (the Government Ethics Coalition, Money in Politics Coalition, Open Government Campaign, and Voter Rights Campaign).

Bill C-2 (the FAA) includes the following 30 key measures (NOTE:  As noted below, 15 of the 30 measures listed below are not in force until the federal Cabinet approves them, and the Cabinet is never required to approve them — To see details about these 15 measures, click here):

  • New limits on political donations under the federal Elections Act (NOTE: The new donation limits set out below will increase each year on April 1, 2007 by the percentage of inflation):
    • secret, unlimited donations of money, property or services made directly to candidates in federal elections are banned, and almost all donations of more than $500 will have to be disclosed to the Chief Electoral Officer within 4 months after each election (in the past, unlimited donations were allowed and did not have to be disclosed as long as the candidate did not use the donation for their campaign) — NOTE: this measure does not come into effect until June 12, 2007;
    • donations from corporations, unions or organizations of any kind to any party or any type of candidate at any time are banned;
    • as of January 1, 2007, the annual limit on individual donations is decreased from $5,000 to $1,100 total to each party;
    • as of January 1, 2007, the annual limit on individual donations is decreased from $5,000 to $1,100 combined total to each party’s nomination race candidates, election candidates, and riding associations;
    • as of January 1, 2007, the annual limit on individual donations is decreased from $5,000 to $1,100 total to each election candidate who runs as an independent;
    • as of January 1, 2007, the limit on individual donations is decreased from $5,000 to $1,100 to each candidate during a campaign for the leadership of a party;
    • cash donations of more than $20 are banned, to ensure that there is a written record of almost all donations;
  • General Elections Act changes:
    • the period during which Elections Act violations can be investigated and prosecuted is extended from three years to 10 years (to help ensure that violators who hide their violations do not escape accountability);
  • Government ethics changes (NOTE: the measures in this section will not come into effect until the federal Cabinet declares that they are in effect):
    • MPs who have a trust fund/bank account for collecting donations outside the limits and disclosure system set out in the Elections Act are required to shut down the trust fund/bank account if the money in the fund/account could be used in any way to benefit them at any time (however, it seems that this measure does not prohibit MPs from maintaining a trust fund/bank account for collecting donations to support other individuals or organizations);
    • federal Cabinet ministers, their staff, and some senior government officials will no longer be allowed to have dealings with the trustee that handles their assets in their “blind trust” set up to avoid conflicts of interest;
    • Dr. Bernard Shapiro, the current federal Ethics Commissioner, who has in dozens of cases failed to enforce federal ethics rules, will very likely be replaced by a new appointee to the new position of Conflict of Interest and Ethics Commissioner, in part because Bill C-2 requires the new Commissioner to have expertise in the area of ethics enforcement (which Dr. Shapiro does not have) — To see details about Democracy Watch’s court challenge of the Ethics Commissioner Dr. Shapiro’s failure to enforce federal ethics rules, click here;
    • the new Conflict of Interest and Ethics Commissioner will have new powers to investigate anyone covered by the federal ethics rules whenever there is evidence of a violation (in the past, the Ethics Commissioner often abused technical loopholes to refuse to investigate ministerial staff or to refuse to investigate if a complaint was not filed by an MP or Senator);
    • the federal Conflict of Interest and Post-Employment Code for Public Office Holders Code (which applies to Cabinet ministers, their staff, and senior government officials) is changed from a code into a law called the Conflict of Interest Act (NOTE: the Conservatives cut 5 key rules that were in the Code, and as a result the Act sets weaker ethics standards than the Code did).
  • Lobbying law changes (NOTE: the measures in this section will not come into effect until the federal Cabinet declares that they are in effect):
    • almost all senior politicians, their senior staff, and senior government officials (including people serving on “transition teams” when the ruling party changes) are banned for 5 years from becoming a lobbyist after they leave office;
    • lobbyists are required to disclose each month the subject matter of their communications with senior politicians, their senior staff and senior government officials;
    • lobbyists are banned from contingency/success commission fee arrangements with their clients (to discourage lobbyists from trying to win policy changes at any cost, including using bribes);
    • the watchdog for lobbyists, who is currently a lapdog completely controlled by the federal Treasury Board minister, will be changed into a fully independent Officer of Parliament, who will be a more fully empowered watchdog;
    • the period during which Lobbying Act (NOTE: the FAA changes the name of the Lobbyists Registration Act to the Lobbying Act) violations can be investigated and prosecuted is extended from two years to 10 years (to help ensure that violators who hide their violations do not escape accountability);
    • the fines for violating the Lobbying Act are doubled from $25,000 to $50,000 on summary conviction, and from $100,000 to $200,000 if convicted by indictment;
  • Whistleblower protection changes:
    • protection from retaliation by an independent watchdog agency (the Public Sector Integrity Commissioner) for most government employees if they blow the whistle on government wrongdoing (the protection is not as strong as it should be, but it is protection that has never existed before, and is the first such comprehensive law in Canada);
  • Open government changes:
    • the Access to Information Act has been extended to about 50 government institutions (and, in the case of Crown corporations, their wholly-owned subsidiaries) that were previously not covered by the Act (NOTE: this measure will not come into effect until the federal Cabinet declares that it is in effect);
    • a written report of all polls and surveys conducted internally by federal government institutions must be created, and must be disclosed within 6 months of receipt of the report;
  • Government spending changes:
    • a Parliamentary Budget Office will be created that will (like the U.S. General Accounting Office) provide independent analyses of government budget estimates and the state of the nation’s finances;
    • senior government officials are required to put in a written record any disagreement they have with a Cabinet minister concerning the legality of spending decisions (to help ensure that the person responsible is held accountable for illegal or unjustifiable waste);
    • new offences are added to the federal government’s Financial Administration Act making it clearly illegal for anyone involved in any government institution (including Crown corporations) that collects, manages or pays out government money to steal from the government, with the penalty of a fine of up to $5,000 and up to five years in jail if money or something worth less than $5,000 is stolen, and if money or something worth more than $5,000 is stolen, the penalty of a fine of up to the amount stolen, and up to 14 years in jail;
    • a Procurement Ombudsman, who will audit only government spending on goods and services, will possibly be created (it is only a possibility, as Bill C-2 gives Cabinet the choice of whether or not to establish and maintain the Ombudsman) to enforce a new code on procurement practices (NOTE: This measure will not come into effect until the federal Cabinet declares that it is in effect);
  • Cabinet appointment changes:
    • a Public Appointments Commission, which will help ensure a merit-based nomination process for Cabinet appointees, will possibly be created (it is only a possibility, as the Bill C-2 gives Cabinet the choice of whether or not to establish and maintain the Commission);
  • General government accountability changes:
    • all Officers of Parliament (ie. the Conflict of Interest and Ethics Commissioner, the Auditor General, the Chief Electoral Officer, the Information Commissioner, the Privacy Commissioner, the Commissioner of Lobbyists, and the Public Service Integrity Commissioner) will now be appointed only after consultation with all parties and passage by majority vote of a resolution in the House of Commons;
    • a fairly independent Director of Public Prosecutions will be created to handle prosecutions involving federal government politicians and officials (so that the Minister of Justice does not attempt to stop prosecutions that affect the Minister’s government), and;
    • staff of politicians will no longer be guaranteed a job as a government employee if the politicians they work for is defeated or they leave their work for a politician.
  • To see a summary of the 85 undemocratic loopholes in the federal government’s accountability system that Bill C-2 (the so-called “Federal Accountability Act” (FAA)) does nothing to close, click here
  • To see the details about the ethics complaint Democracy Watch has filed about the Conservatives’ breaking their election promises concerning Bill C-2, click here
  • To see the details about the 15 of the 30 measures in Bill C-2 that will only come into force when the federal Cabinet approves them (and the Cabinet is never required to approve them), click here
  • To see an opinion piece about Bill C-2 by Democracy Watch Coordinator Duff Conacher which was published in two Canadian newspapers,click here
  • To see Bill C-2, the so-called“Federal Accountability Act”and related federal government documents go to:http://www.accountability.gc.ca