Legislative Assembly of Ontario

CONFLICT-OF-INTEREST GUIDELINES

PREMIER OF ONTARIO

CONFLICT OF INTEREST COMMISSIONER

CONTENTS

Monday 18 February 1991

Conflict-of-interest Guidelines

Premier of Ontario

Conflict of Interest Commissioner

Adjournment

STANDING COMMITTEE ON ADMINISTRATION OF JUSTICE

Chair: White, Drummond (Durham Centre NDP)

Acting Chair: Fletcher, Derek (Guelph NDP)

Vice-Chair: Morrow, Mark (Wentworth East NDP)

Carr, Gary (Oakville South PC)

Chiarelli, Robert (Ottawa West L)

Harnick, Charles (Willowdale PC)

Mathyssen, Irene (Middlesex NDP)

Mills, Gordon (Durham East NDP)

Poirier, Jean (Prescott and Russell L)

Sorbara, Gregory S. (York Centre L)

Wilson, Fred (Frontenac-Addington NDP)

Winninger, David (London South NDP)

Substitutions:

Murdock, Sharon (Sudbury NDP) for Mr F. Wilson

Scott, lan G. (St George-St. David L) for Mr Chiarelli

Wood, Len (Cochrane North NDP) for Mr Winninger

Also taking part:

O'Neil, Hugh P. (Quinte L)

Marland, Margaret (Mississauga South PC)

Clerk: Freedman, Lisa

Staff: Swift, Susan, Research Officer, Legislative Research Service

The committee met at 1305 in committee room 2.

CONFLICT-OF-INTEREST GUIDELINES

The Chair: I would like to call the meeting of the standing committee on administration of justice to order. This afternoon we are meeting from 1 o'clock until approximately 4 o'clock with reference to the conflict-of-interest guidelines; to speak to them we have Premier Bob Rae.

PREMIER OF ONTARIO

Hon Mr Rae: Thank you, Mr Chairman. I cannot remember the last time a Premier appeared before a committee when I was in opposition, but I am just delighted to be here and to basically answer questions. I have a very brief statement that I would like to make. I would like to explain a couple of things and respond to a couple of earlier comments that had been made by opposition critics with respect to this issue and try to explain my own views and the views of the cabinet with respect to this situation.

The first thing I want to say is that in my view we have made, and are making, a lot of progress. When I say "progress," I mean historically speaking. If you look at this issue, which is one that has troubled different governments at different times, I think it is worth pointing out that we have now reached a level of understanding and sophistication and of knowing some of the pros and cons of different ideas, and we have had a fuller airing of these things over the last few years than in the past.

I think basically the public is well served by a continuing debate, and it is because of my desire for a continuing debate that I encouraged very much the House leaders to establish this committee to consider further the questions of conflict laws as they need to be continually updated.

Members should have received -- which was done very helpfully by staff of the Ministry of the Attorney General -- a comparative chart with respect to a set of guidelines which should have been made available to people, showing some of the evolution of what has taken place.

When I made the statement in the House on 12 December 1990, opposition critics made different points and I want to respond to them very briefly.

The critic for the Liberal Party, Mr Sorbara, who is here, objected at a policy level and a philosophical level because he felt that with the guidelines, no one who had any business interests would ever enter politics. I would just disagree with that and say that is not the intention of the additional guidelines which I put forward for the cabinet. Rather, it is the intention to say divestment where possible; divestment is obviously the easier solution, but if that is not possible for a number of reasons and criteria that are set out very specifically in the guidelines, that it then is set up as a trust and is explained in that context.

I do not know whether members are interested in this, but in 1986 I wrote to Mr Aird, who was establishing the proposal for the legislation in the previous government. If members are interested in seeing that letter, which is a six-page letter, I am happy to leave it with the committee; and if you want to have some further insight into some of the reasoning behind the distinctions I have made, I would be happy to leave that with members of the committee.

The other thing that Mr Sorbara said was that I was taking all this into my own hands and taking it out of the hands of the commissioner. That is the opposite of what I intend to do. The difficulty is that by means of guidelines, I could not extend the power of the commissioner; it would be illegal for me to do that. I cannot legally extend the power of the commissioner.

Mr Sorbara: You can make a change to the bill.

Hon Mr Rae: Yes, we can, and that is one of the reasons why the matter is before the committee, and I hope that the committee itself will be making recommendations that will allow us to draft legislation that I hope will make it very clear.

Mr Evans is here, and you will have a chance to question him after I have gone. I think it is fair to say that we are, not in daily contact, but certainly in regular contact --

Mr Scott: Oh, you will be in daily contact with him as things go on, I can assure you of that.

Hon Mr Rae: Thank you, Mr Scott.

We discuss regularly issues that involve matters of judgement. That relationship is one that I think again is all to the good and is one that I think needs to be clarified in the legislation. As I say, it is not something that I can do by means of the guidelines, but it is something that I think is appropriate.

The second kind of criticism which the guidelines received was some very specific criticisms from the critic for the Conservative Party, Mr Sterling. Those criticisms basically were that the guidelines which I had put forward were different from those put forward by Mr Davis and in particular that they treated the question of the activities of spouses and minor children differently, in particular, spouses. That is true. I think it is a basic question of value and of philosophy that I have to wrestle with, that cabinet has to wrestle with and indeed this committee, now that it is seized of this question, has to wrestle with as well. That is, I simply do not believe that in modern economies such as ours in 1991, or modern societies such as ours, it is possible to bind spouses in the way that Mr Davis may have thought it possible to do back in the early 1970s. It is not a question of its being too onerous. For me, it is a question of its simply being inappropriate. The rule there has been, and it is again a rule, I think, that was followed by the previous government and it is one which we have put forward in the guidelines, that disclosure is appropriate, necessary and vital, but that there should be basically no additional requirements, except of course to make it clear there are situations and circumstances where that disclosure has to be acted on by a member of cabinet in indicating that he or she cannot participate in a cabinet decision because it might involve a potential conflict. As I say, that is an issue that the cabinet wrestles with. I am sure others have wrestled with it as well.

We also wrestled with the question of to what extent it is appropriate to bind other members of the family. There, I must confess, I find it very difficult to see how one can legitimately argue that brothers and sisters, cousins or others should be prevented from carrying on normally with business and indeed being involved in companies that contract with governments, as long, again, as that information is well known and as long as everyone understands it. Again, in the kind of society and economy that we live in, it is ludicrous for us to suggest that the entire extended family of a member of the Legislature, a member of cabinet, should not be able to participate in business or economic life, simply by virtue of the fact that one member of their family saw fit to enter public life.

I think that, all in all, we are trying to do a number of things. One is to constantly reassure the public that information is available, that people know what interests members of the Legislature have in an economic sense. We are trying to provide a degree of confidence to the public to which we feel that they are fully entitled and the public is fully entitled to it.

We are also trying to strike a balance between what is necessary and what needs to be done to establish very clearly the highest standards in terms of the integrity of government and the integrity of the political process.

We are also trying to be reasonable and practical in recognizing that there is a diversity of interests which people have and that those interests which people had prior to entering public life are perfectly legitimate. Where, for example, divestment is impossible or where it would cause great hardship to the individual or to their family, we would continue to provide for the principle of a trust which would be in place, which would not be directed by the member or indeed by the member's family, but which would be allowed to continue to operate. That is the principle that has been established.

There are a number of tricky issues which I am sure you are aware of and are going to ask me about, both in terms of individuals and in terms of hypothetical situations, which I would be glad to discuss with people. I can only assure you that I do not enter into this discussion with a sense of having any monopoly, either on virtue or on knowledge of the practical situations. I think it is important to say that the reason this committee was established was in order to allow members to participate fully in the discussion of how the law could usefully be reformed and how it could be better implemented and to get the views of members with respect to these questions.

I myself felt it was inappropriate for me to simply impose on members standards which had not been discussed with them or which they had not been involved in discussing or involved in developing. At the same time, I think it is important that this process be done in a way in which the public sees there are a variety of interests which are being considered and a variety of experiences which are being drawn on in order to allow for better legislation. As I say, the legislation which we have goes a good way. I think it establishes some important principles. The guidelines which I have set down, I hope, will advance the debate a bit further. I think it is important for us to explore whether these standards need to be further made available to members, or whether it is simply a question of applying them to the executive council.

One other thing that I did that again has not been done before was to apply the guidelines to parliamentary assistants. I can tell you that this was not an easy decision to take. It was based on my view that, if you look at the future of parliaments, the work of parliamentary assistants is going to become more important rather than less important. Their involvement, for example, in our government in decisions of cabinet, cabinet committees and so on, is going to be even more the case, rather than less the case, and in that circumstance it seemed a natural thing for us to extend the application of the guidelines to parliamentary assistants.

As I indicated last week, because we are doing something new, the application of these guidelines to parliamentary assistants in particular has had to be extended until 31 March. I guess it is a combination of a practical change being introduced for parliamentary assistants and the fact that the economic situation in the province is such that to simply require divestment out of the blue would cause some difficulty for people and I thought it would be wise to extend the time until 31 March.

I have also made certain clarifications with respect to rental accommodation, registered retirement savings plans and mutual funds which again simply responded to the practicalities of the situation. If you have any questions about those, I would be glad to respond as clearly as I can to them, because I think it is important that that be done.

I am now in your hands and would be glad to answer any questions that I can. The only thing I would say to you, Mr Chairman, is that I do have some obligations to be at a cabinet committee meeting at 2:30 and if I could possibly be away before then I would appreciate it, but I am in the committee members' hands. They may not want to see me for that long, I do not know.

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The Chair: I do not think it is a major problem. That does create a small change in our agenda, but I notice that the Honourable Gregory Evans is with us. In any case I am sure you would be here for most of the Premier's address, sir. Perhaps we could start.

Mr Sorbara: Given our experience last week in disagreements in this committee over timing, I want to first express my surprise that the Premier wants now to leave at 2:30. Our understanding was that he was going to be here until 3. Can we come to some agreement now as to how we are going to divide up this time? My submission would be that, given that these are the Premier's guidelines and that there has probably been a thorough discussion of them in his own caucus, the time available to us -- that is, the hour and 10 minutes available to us -- ought to be distributed between our party and the Progressive Conservatives. I am in your hands, Mr Chairman, and the hands of the committee, but I think we should deal with that now.

The Chair: I would certainly welcome the comments of the government caucus.

Ms S. Murdock: I certainly think we should have the opportunity, and I am almost positive I can expect comments -- certainly from Mr Sorbara -- that I would like to comment upon. I think, therefore, that all three parties should have the opportunity to question the Premier.

Mrs Mathyssen: I would like to concur with Ms Murdock and I would propose that there be an equal division of time between the three caucuses.

The Chair: There is a motion for equal division of time, Mr Sorbara.

Mr Sorbara: Whenever the government makes a proposal on this committee, Mr Chairman, they have the majority so I guess that is what it is going to be. How shall we proceed? Shall it be our party first and then the Tories and then the government, or what do you propose in that regard?

The Chair: I was going to suggest that. Go ahead, sir. I would also like to welcome Mr Scott and Mr Wood.

Mr Scott: Perhaps I can begin by asking a question of the Premier. Section 14 in the guidelines calls for a declaration of a conflict of interest in cabinet, and I take it that the Premier would have regarded that as appropriate with or without the guidelines and would have applied that since his first cabinet meeting in October. If a minister had a conflict, you would have expected that minister from the first meeting to stand up in cabinet and say, "I have a conflict, I own shares in this company we are talking about," or whatever it might have been.

Hon Mr Rae: Yes, that is correct.

Mr Scott: Have such declarations been made by any of your ministers -- I am not asking for names or anything like that -- since 1 October?

Hon Mr Rae: To my recollection, yes, there have been.

Mr Scott: Can you tell us approximately how many times?

Hon Mr Rae: Twice.

Mr Scott: When are you going to disclose those conflicts, as section 14 requires?

Hon Mr Rae: I will have to discuss that with the secretary of cabinet, but in terms of when that is to be done, as I would understand it, it should be done when a decision is made. And you must not hold me to the twice; it might be more than that in terms of individual decisions. Let me give you a couple of examples, Mr Scott, just so you can know, because sometimes raising the question raises questions in people's minds.

Mr Scott: I accept what the Premier says.

Hon Mr Rae: Rather than let hypothetical ghosts dance through the heads of people who are listening, let me give you a couple of practical examples. People, for example, whose extended family, sisters, uncles, brothers, fathers, may in their view -- in my view, most cabinet ministers are excessively careful -- may feel that there might be a conflict in a particular decision being made. You know the way cabinet works; you get 25 recommendations coming from the Ontario Development Corp and somebody says, "Wait a minute; maybe I should declare a conflict here" --

Mr Scott: Premier, if you will forgive me for interrupting, our time with you has now been cut down by half an hour. I am trying to keep my questions short; I would appreciate, in the tradition, that you might do so as well if possible.

Hon Mr Rae: I will do my best.

Mr Scott: I take it that it goes without saying that you will see to it that those decisions are communicated to the public as quickly as possible.

Hon Mr Rae: Yes, quite simply, as simply as I can, I would say that would be my intention.

Mr Scott: Under section 15 of the guidelines, ministers are required to divest themselves except where they satisfy you of a number of conclusions, in which case you can in effect waive the divestment. I am summarizing the effect of the section. Have any people applied to you to waive divestment under section 15 so far?

Hon Mr Rae: That is a discussion that is still ongoing. As I said to you, the deadline has been extended to 31 March. I would also say to you that I do not intend to take any decision with regard to a particular minister or parliamentary assistant without discussing it with Judge Evans.

Mr Scott: No. I understand that perfectly. I am simply asking not whether you have made a decision but whether applications have been made to you under that section by ministers or parliamentary assistants, or requests made orally.

Hon Mr Rae: I think we are at the stage right now, particularly with PAs, where there are some oral requests and some discussions that certain PAs are having. I have received nothing yet in writing, and obviously this will be done by means of correspondence being exchanged and then a discussion with Judge Evans with respect to a particular situation.

Mr Scott: So you have received no such requests.

Hon Mr Rae: I have received some, but I have made no decisions yet of a final nature and I have had no discussions yet with Judge Evans except of a very informal nature with regard to a number of situations which again arise simply as a matter of course.

Mr Scott: When you say you have received some requests, can you help us by saying whether that would be less than 10 or more than 10?

Hon Mr Rae: Yes, far less than 10.

Mr Scott: And would you like to tell the public the names of the ministers who have asked for this benefit?

Hon Mr Rae: Not yet because -- you said it was ministers. It is not necessarily ministers; it is also parliamentary assistants.

Mr Scott: I see. Them too.

Hon Mr Rae: Some. But again there are situations that involve the interests that I think have already been disclosed to Judge Evans and that are there as a matter of record. But as I say, those decisions are not going to be made in a final form until 31 March. I think it would be better, and it would be my intention, to probably try to release all the decisions together as a package and present them to you and to the House for further discussion by 31 March.

Mr Scott: Two other matters, I hope very short. When the conflict-of-interest bill was debated, the theme of the bill was that conflicts, whether they be conflicts in the form of requiring disclosure or some other positive act, should be capable of being examined by an independent official; that is, an official independent of politicians like you and me. The purpose of that, as I understand it, was at least twofold; first of all, so that the public would have the sense that politicians were not making these decisions about who could do what, or who could own what, or who could join what organization, and so that the person accused of a conflict would also have access to an independent judge. That is why the act was passed in the form it is.

Why is it that these guidelines put all these powers in the hands of a politician, namely, the Premier? It is the Premier who can decide whether divestment is required. It is the Premier who can decide whether it goes into a blind trust under section 15. It is the Premier who decides whether there is a public interest at stake. It is the Premier who decides whether he is satisfied that there would be hardship.

There are several other sections in the guidelines which in effect give the Premier, as far as I can tell, almost the exclusive right to decide these things. When you decide that someone does not have to divest or someone does not have to declare a conflict, it seems to me that is going to be that, is it not?

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Hon Mr Rae: First of all, I think I made clear to Mr Scott in my opening statement -- and this again is something I think needs to be debated by the committee; it is something on which I would be glad to have the advice of the committee, and I mean all the members of the committee; first of all, by means of the guidelines, I could not extend the power of the commissioner. I did not legally have the power to do that and it was the legal advice of the Ministry of the Attorney General, a ministry with which I am sure you are acquainted.

Mr Scott: I barely recollect it.

Hon Mr Rae: With moments of great fondness, I am sure. They reminded me of the fact that I could not by means of guidelines give the commissioner powers which he otherwise did not have.

Let me just say to you that this is something I want to hear from the committee about, with respect to it being the commissioner who would make judgements. Again, I will leave with you the six-page letter that I wrote to Mr Aird where I indicated that I thought, with respect to the ongoing management of the trust, for example, that it would be thoroughly appropriate for the commissioner to have the power to review the management of a trust if there was any concern that he or she had that the trust was not being managed in an appropriate way. In terms of extending the powers of the commissioner, that would make me very happy if that is something that the committee wanted to do in terms of a new law. I did not feel I could simply bring in a new law without giving the committee the chance to discuss its implications.

But let me also say to you, however, that at a certain level these things all become political questions, and at a certain level the buck does stop with the Premier. At a certain point, my observation would be that there are situations where you are likely not to be satisfied and others are likely not to be satisfied with my or any Premier, not to personalize it, but indeed any Premier, saying, "Send that to the commissioner and let the commissioner decide."

There is also this question of political accountability and people needing to know what the rules are and being able to ask questions about it in the House. You may not agree with the response, you may not like the response, but at least there is a sense of political accountability. I guess what I am saying is that, sure, at a certain level, yes, I understand your model, the model that you introduced in your legislation.

Mr Scott: It is your model.

Hon Mr Rae: It is the model that we are all left with now, but I mean it is the model that you presented to the House. I can understand it and I see its logic and its merit. I also think there is a political reality that even with the working and the advice and the views of the conflicts commissioner, there are times and situations when an additional level of political accountability is necessary.

Mr Scott: Premier, you began by saying that you would like the commissioner to do all this, and then you went on to say "but however," a phrase that we are hearing quite a lot since 6 September. I just draw to your attention that when you were taxing the previous government about this in July 1986 there was not the slightest doubt that all this should be done in a court, that is what you were talking about, and in public so that the public could see what was being decided, not in the privacy of some Premier's office. What you said --

Hon Mr Rae: Nothing has been decided. I make decisions in various places, and the consequences of those decisions and the wording of those decisions and the meaning of those decisions is very public. It is a very public process.

Mr Scott: But do you not remember, Premier, when you used to tell us about Manitoba and Saskatchewan and how great they were under the NDP governments? July 1986, page 2123 of Hansard -- I can just hear it now; I must have been there:

"Let us go back to this point. Is the Premier aware that there are at least two jurisdictions next door to us in this country, Manitoba and Saskatchewan, where this determination is made in the courts? A determination is made after an application is made either by the voters or by a standing committee of the Legislature with respect to a violation. All the questions the Premier is unable to answer are answered by a court, and if the court finds there has been a violation, the individual found to be in violation is disqualified from running in the next election."

We are talking about conflicts or any of these things.

Will you recommend to your cabinet that these guidelines should be incorporated in legislation so that all these determinations can be made either by a judge or by the Conflict of Interest Commissioner?

Hon Mr Rae: I have no difficulty with that at all, Mr Scott, none at all.

Mr Scott: Good. Tell him to get the bill.

Hon Mr Rae: But let me say to you, since you have asked the question, if you look at the terms of reference of this committee -- which were drawn up by all three parties but which I can assure you our party had something to do with and I did happen to see before they went out -- we make it very clear that giving increased legal rights to citizens to apply, giving a legal capacity for citizens to get these things enforced and to have these questions done in public, are things I am quite happy to do.

You can be implicitly critical of me for not bringing forward a piece of legislation, but since you have asked, let me say to you very directly, I think it would be far better for us to have this discussion, for us to have the views that are out there in the committee, and for us to have Judge Evans coming forward with his suggestions, which are very practical because he has seen into the affairs and into the realities of the life of every single member of this Legislature, before I suddenly bring forward a piece of legislation. I think that is a better approach.

Mr Scott: I think we are all grateful for that, Premier.

The Chair: I think Mr Sorbara was wanting to ask a question as well.

Mr Scott: Can I just follow one thing up if you will permit me? I am grateful for your view that this kind of guideline should be put in legislative form. I take it I also have it from you as part of that that the decisions that are now made under the guidelines by the Premier will be, under such legislation, made by an independent commissioner like the Chief Justice.

Hon Mr Rae: Sure, but let me also say to you --

Mr Scott: "Sure, but"?

Hon Mr Rae: No, "sure and" or "however" or "wherever" or "whatever." I know you are spending some of your time in courts these days, but this is not one of them.

Mr Scott: You were the one who said we should be in court on these things. That is what I am asking.

Hon Mr Rae: I say it right here. We establish here "the need to strengthen the investigatory powers of the commissioner, to establish a judicial proceeding for adjudicating conflicts, appropriate means for electors to initiate investigations of alleged conflict of interest." It is all here.

Mr Scott: Sure. I am with you.

Hon Mr Rae: That is exactly what we are suggesting, that this is what the committee should be seized of. l would like to hear the view of the committee and I would like to hear your views, because it seems to me there are times and occasions when, in opposition, you are going to want to say to the Premier, "It's all very well, don't tell us what the standards are in the law; tell us what your own standards are and tell us what you think should happen."

I suspect that, looking at members of the opposition, there is going to be the occasion when you are going to want to ask that question. And I do not think you are going to be satisfied with the answer that says: "Oh well, wait a minute now, we've got a committee looking into that. As soon as I hear back from the committee I'll get back to you." It has been my sense that at some point the buck also stops at the Premier's office and there has to be that understanding.

Mr Scott: I stand with the Bob Rae of 1986 on this issue.

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The Chair: Greg Sorbara of 1991?

Mr Sorbara: Premier, I was interested in your comments on my comments the day on which you introduced these guidelines. I was interested because at that time you did not refer to the fact that it was impossible to incorporate into these guidelines additional powers to the commissioner. What you did in the guidelines was simply put additional powers into your hands, and I understand your position today is at least somewhat qualified in that regard. When I listened to your introductory remarks, you said you thought it was important that information be available to the general public and to members and that there be confidence in the public. I would like to go over perhaps four or five cases where decisions of this type on government integrity have been made and the people who were really left in the dark were the public, and I would like to be able to give you an opportunity to comment on any or all of them.

First of all, in the case of Tony Rizzo, he was -- I guess there is no nice way to put it -- thrown out of your caucus based on allegations which were never aired in public or known to the public, but they had to do apparently with some sort of alleged criminality or quasi-criminality.

In the case of Dennis Drainville, who was convicted of a criminal offence, he was not asked to leave the caucus. In fact, apparently he was congratulated by you upon the actions that he had taken.

In the case of Anthony Perruzza, the member for Downsview, there were some press allegations that he had inappropriately used resources of the city of North York, and there seemed to be no consequences in that regard.

Now, two other cases which I think touch directly on the conflict-of-interest guidelines are these -- perhaps I will let you comment on those and --

Hon Mr Rae: No. Keep going.

Mr Sorbara: Okay, maybe I will, because you never know when the Chairman is going to ring the bell and say, "Time is up."

Hon Mr Rae: I just want to have them all out on the table.

Mr Sorbara: In the case of the Minister of Colleges and Universities and the Minister of Transportation, there were suggestions on the last day of the House that inappropriate contact had been made with city of Hamilton NDP council members. On that day, in fact, in question period you said you had made inquiries sufficient to satisfy yourself that a mistake had been made, but the mistake was not fatal. Could you tell the committee what inquiries you made and the extent to which you asked others to do an independent inquiry before you made the political decision that there should be no consequences to the discussions had by the Minister of Transportation and the Minister of Colleges and Universities?

Finally, in the case of the Minister of Community and Social Services, a few days ago in a scrum you suggested that her letter to the city of Toronto, in fact intervening in a hearing which was currently before the city of Toronto, was a mistake. But apparently you had made sufficient inquiries to determine, I guess individually or in counsel with your advisers, that the mistake was not sufficiently serious such that there should be consequences for her interventions there.

I point out to you that the city of Toronto was undertaking a quasi-judicial hearing in considering an application by St Michael's College for a change in land use, and I point out to you as well that the city of Toronto, basing its information on the fact than an inquiry was made by a minister who was responsible largely for its social service funding, agreed, without representation from the University of Toronto or St Michael's College, to defer its decision.

My problem in all of these cases is that, from a Premier who has claimed that it is important for the public to know, who demanded inquiry upon inquiry when he was the Leader of the Opposition, in none of these cases has there been even the semblance of some sort of public disclosure about what actually happened. In some cases there have been consequences: Rizzo. In some cases there have not been consequences: Richard Allen, Ed Philip, Zanana Akande and, of course, Dennis Drainville. Can you tell us what inquiries you made in each of those cases and the basis upon which you decide when there shall be consequences and when there shall be no consequences?

The Chair: I suspect the answer will take almost as long as the question, so I --

Hon Mr Rae: No. The answer will be fairly brief. I will try to keep it brief.

The Chair: Fine.

Hon Mr Rae: But first of all, Mr Sorbara, you have used the words "alleged criminality or quasi-criminality" with respect to Mr Rizzo. You have used those words. I would not use them. You have used them. Okay? I just want to make that clear. Those are your words, no one else's.

The situation with Mr Rizzo and his membership in our caucus had to do with a matter that had been before the Ontario Labour Relations Board, which is again a public body which made a public decision with respect to companies of which Mr Rizzo was the owner, and the fact that it had been in violation of the Labour Relations Act with respect to --

Mr Sorbara: That has happened to a lot of companies in the history of the labour board.

Hon Mr Rae: I am just saying to you, that is the extent of the situation. Mr Rizzo made a decision with respect to withdrawing from the caucus because, frankly, I had not had any knowledge of any of these difficulties at any time and I think Mr Rizzo felt that --

Mr Sorbara: If he were a matter of public record -- in fact, you nominated Tony Rizzo, did you not, at his nomination meeting?

Hon Mr Rae: There were many things to be a matter of -- no, I did not nominate him. I was at the meeting, as leaders are often at many different political meetings. But again, in answer to that particular allegation of yours, no, that is not correct either.

Mr Scott: Okay, so he broke the Labour Relations Act. Tell us about breaking the Criminal Code.

Hon Mr Rae: Wait a minute. No. Mr Scott, you have made a comment on the record which you can make which I am simply going to leave without comment.

Mr Rizzo made a political decision with respect to his membership in our caucus, and in my view that is the beginning and the end of it. I felt as leader that I had been let down because I had not been aware of any of these situations, and Mr Rizzo made a judgement with respect to his participation in the caucus. I think it is also known to you and it is known to everyone that there have been a number of inquiries into the city of York which are being completed. Mr Rizzo, I think, felt that until those inquiries were completed and everything was over it would be better for him to stay out of our caucus. That was a political judgement on his part. It had nothing to do with conflict legislation. It had nothing to do with --

Mr Sorbara: It has to do with integrity.

Hon Mr Rae: It had to do with his sense of his relationship with our caucus and with where we are.

With respect to Mr Drainville, his conviction was because of his convictions, because of his being on the Red Squirrel Road; he was there as a matter of conscience. He was charged, he was tried, he was found guilty and he has been sentenced. That is all a matter of record. I do not think anything of which he has been convicted -- and again this is the judgement I make, for which some will criticize me and others will not -- speaks to or shows a defective character. What he has done he has paid a price for, and frankly, I think it would be inappropriate for me as leader to -- he has been elected to a position of responsibility in our caucus and presumably it will be up --

Mr Sorbara: He is the chairman of caucus, is he not?

Hon Mr Rae: The chairman of our caucus, and it will be up to our caucus to determine whether he is re-elected when he next stands for office. Again, that is a matter that --

Mr Sorbara: You make those decisions.

Hon Mr Rae: No, I do not make those decisions.

Mr Sorbara: Are there other criminal offences which would disqualify him from being the chairman of your caucus?

Hon Mr Rae: Are you alleging so?

Mr Sorbara: No. I am just asking, because you make those decisions.

Hon Mr Rae: Oh, you are just asking. I see. I am not going to dignify that particular question with an answer.

Mr Sorbara: No, but --

Hon Mr Rae: Simply go on, Mr Sorbara, since you have made another set of accusations. I want to just respond to them. You have said there were press allegations with respect to Mr Perruzza.

Mr Sorbara: There were allegations in the press.

Hon Mr Rae: In the press, that is true.

The Chair: Mr Rae, were you wishing to continue with this?

Hon Mr Rae: I am just responding to these ones as I can. Again, Mr Sorbara, I can only say to you that there are a lot of allegations in the press at various times on various people. Mr Perruzza used some stationery, the stationery of the municipality for which he was elected. An allegation was made that this was inappropriate. I think there were future stories which showed there was nothing unusual or untoward in any way in what had happened.

With respect to the conduct of the Minister of Colleges and Universities and the Minister of Transportation, there was a very lively political conflict in the House the last day of the session before Christmas. Frankly, I did not hear any evidence of any conduct that would bring a member into conflict with either the Legislative Assembly Act or the conflict act.

Mr Sorbara: There was some allegation in respect of the oath of a cabinet minister.

Hon Mr Rae: Yes. We had that discussion. I would be happy to go through that again with you, and I said again --

Mr Sorbara: But what I ask here is, what inquiries did you make? What investigations did you make?

Hon Mr Rae: Inquiries that I made were the ones that one would normally make. I spoke to the ministers in question.

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Mr Sorbara: And?

Hon Mr Rae: I spoke to them very thoroughly with respect to what they say happened. I spoke to other members from Hamilton who were alleged to have been involved and discussed it with them and satisfied myself that a political error of judgement had been made, which was admitted to by the minister. I also discussed it with the mayor of Hamilton and with the regional chairman, both of whom said that while they were not happy with the decision with respect to the Red Hill Creek Expressway, they had nothing at all to complain about with respect to the conduct of the two ministers in question in terms of their integrity or in terms of their dealings with them. And that satisfied me.

While there were certainly grounds for a lively discussion in the House, which there will be on many occasions and indeed in this committee, we are not talking about anything that could be said to resemble a conflict. With respect to the Minister of Community and Social Services, what I said to the minister was -- and again, what inquiry did I make? I spoke to the minister very directly, and what she told me was --

Mr Sorbara: Her interest would be in defending herself, would it not?

Hon Mr Rae: Mr Sorbara, we do these things quite publicly. These things are subject to public scrutiny and public accountability. What I said was, I do not think there is anything wrong with individual members of the Legislature -- and maybe you do -- writing a letter on behalf of their constituents. What is inappropriate, and the guidelines state this quite clearly --

Mr Sorbara: Oh, clearly, and the guidelines were violated.

Hon Mr Rae: Well, you say they were violated.

Mr Sorbara: They are your guidelines and the fact situations are clear.

The Chair: Mr Sorbara, we have run out of time.

Hon Mr Rae: I would say to you that it is my judgement that they were not, that what was inappropriate was not making it clear that one was writing as a member of the Legislature rather than simply as a member of cabinet, and those are distinctions that need to be made.

Mr Sorbara: Are you of the opinion, then, that a cabinet minister can separate himself or herself from the cabinet --

Hon Mr Rae: I am of the view, Mr Sorbara, that when you join the cabinet, you should not suddenly be prevented from dealing normally with your constituents. I am the Premier --

Mr Sorbara: Did you respect those views during the last Parliament?

Hon Mr Rae: I have constituency hours as you do --

Mr Sorbara: Sure you do; as I do and I did.

Hon Mr Rae: -- and as other members do. If I could just complete, Mr Chairman, I have constituency hours and I think it is fair game for me to be able to make representations on behalf of constituents as long as it is very clear, as long as it is clear in the guidelines.

Mr Sorbara: All I can tell you is you are going to have a lot more problems of the kind you have identified today.

Hon Mr Rae: I would like to hear your suggestions as to what --

Mr Sorbara: My suggestions are, with respect, Mr Chairman, that a cabinet minister can never shed the robes that he or she wears as a cabinet minister no matter what stationery he or she writes a letter on. You cannot do that. When you write a letter on behalf of your constituents, everyone knows that Bob Rae is the Premier of Ontario even if you put it on blank letterhead.

Hon Mr Rae: I understand that. But are you saying, therefore, that there is no circumstance in which members of cabinet can make representations on behalf of their constituents?

Mr Sorbara: I am saying that I believe there are no circumstances in a quasi-judicial hearing where a minister who is the source of major funding for that very body can make an intervention, particularly when the other parties to the hearing are not even advised that the intervention is going to be made. It was you who said there has to be consequences to these things, and as of yet we have had no inquiry. It was you, as a result of allegations in the press during the last Parliament, who demanded public inquiries and we have had a number of situations here where there has been no public inquiry, no public consideration of the evidence.

Mr Scott: I want the old Premier back.

Hon Mr Rae: I am not surprised you want the old Premier back in.

Mr Scott: If I cannot get the 1986 Premier back, l want Bob Rae from 1986 to come back.

The Chair: With due respect, Premier, while I appreciate your desire to dialogue with Mr Sorbara, the Conservative Party should also have an opportunity to pose questions.

Mr Harnick: Premier, the guidelines do not in any respect deal with the public service, and I am specifically speaking of the level of deputy minister.

Hon Mr Rae: Right. They do not.

Mr Harnick: It is a concern to me because deputy ministers are nameless, faceless people in so far as the public is concerned. I do not know this, because I have never been there, but they also are probably privy to more information than a minister, or certainly than a parliamentary assistant. Your guidelines do not deal with it. How do you intend to rectify that?

Hon Mr Rae: Mr Harnick, it is a very good question and a very direct question and I will answer it as directly as I can. We are going to be introducing appropriate codes of conduct and amendments to the Public Service Act with respect to deputies and other senior appointees. It is our view, as I think I said in my statement, that because they are all crown employees, as are ministers' confidential staff, it would be more appropriate for that to be dealt with under the Public Service Act. But you are quite right when you say that this is an area that has been unexamined and unexplored for a while and that it is important for us to explore it.

Having said that, I want to say on the record that while you have described them as nameless, faceless people, they are not to me any more, since they are people whom I have gotten to know and who work on behalf of all the public. As you get to know them and as others do, you will see that they are very talented, dedicated people of tremendous integrity. And I do not want to --

Mr Sorbara: They have just become so since 6 September.

Hon Mr Rae: No, that is not true. I felt that way about most of them before that.

Mr Sorbara: They always spoke highly of you, Bob.

Mr Harnick: Will you ensure that when the Public Service Act is amended, the necessity for disclosure and divestiture by those individuals will be made?

Hon Mr Rae: Yes.

Mr Harnick: Just to deal with section 14 of your guidelines, let me pose a hypothetical to you.

Hon Mr Rae: Oh oh.

Mr Harnick: Probably not a good one, but --

Hon Mr Rae: No, but that is just very risky to get into.

Mr Harnick: Let's say a minister declares a conflict of interest at a cabinet meeting, indicating something to the effect, "All my money is tied up in company X, or my wife's money is tied up in company X, and therefore l cannot be involved in this decision, but the ramifications of dealing with this in a particular way are going to hurt me very badly." Once that disclosure is made in front of the full cabinet, assuming their colleagues and friends do not want to hurt this individual, how can you then go ahead and proceed as if there is no conflict of interest? I think the whole mechanism set out in section 14 is suspect.

Hon Mr Rae: Okay. How would you do it?

Mr Harnick: I do not know if the disclosure should be made to the whole cabinet. Maybe the disclosure should be made only to the Premier or to the commissioner, because the rest of the cabinet still has to determine what they are going to do with that issue.

Hon Mr Rae: I see. What you are saying is -- try to imagine a situation -- there are situations with respect to appointments and there are situations with respect to order-in-council discussions and there are decisions that are made, for example, not of a routine nature. Let us say the Ontario Development Corp is making a whole bunch of different loans; it is usually not ministers being involved but it is usually sometimes saying "Well, I have some connection with that" or whatever. You are saying that rather than have that made before the whole cabinet, you would rather the minister simply not take part in that discussion or not be there.

Mr Harnick: It may well be that because of the individual's particular circumstances, the rest of the cabinet may feel inclined, subconsciously or otherwise, to protect that individual once he discloses what his problem is in view of the full cabinet. He may then withdraw, but the rest of the cabinet may say, "Boy, we had better look after our colleague; he could be in real trouble here." In a sense, although he has disclosed and he has complied with what section 14 says, there is great abuse possible, only because his friends and colleagues do not want to hurt him.

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Hon Mr Rae: I do not want to denigrate the hypothetical at all, but I just say to you that, first of all, members' interests are public. For example, the range of shares that a member owns is something that is publicly available. I have just been reminded by Mr Shipley, who is working with the Ministry of the Attorney General, that under the Members' Conflict of Interest Act, you are required to make a declaration. All we are doing, for the first time, is in a sense breaking cabinet traditions by making it public so that after the decision has been made, it will be said that the Premier declared a conflict for whatever reason, or somebody else declared a conflict, then you will all ask questions and press will ask questions as to what that was about. It is so the public will understand --

Mr Sorbara: It's at that point we get stonewalled.

Hon Mr Rae: Why? How? No, I do not know how else we would do it, Charles. You have to make the declaration. I do not know how you avoid the problem. If you really think the cabinet sits around and says, "How can we help old Joe or Alice with this one because it is going to help them out?" I mean, that really is not the criterion. In fact, people are so worried about the appearance of a conflict that you make every effort to go the other direction because you know that it is going to look terrible if it appears that you are simply rewarding somebody or somebody's friend.

Mr Harnick: All I point out, though, is that you can comply with the wording of the section but the abuse can still remain. You are exonerated because you complied with the wording.

Hon Mr Rae: Let's face it, there is a legal issue here and there are technical requirements, and then there is the basic political rule that if it looks bad and sounds bad, you are going to get criticized for it anyway. Ultimately, the public makes a judgement call as to how bad that really is, depending on the allegation and the merits of the allegation. You cannot stop the alligators -- like Mr Sorbara, for example. You know, the alligators, like Mr Sorbara and others, who make these allegations. You cannot stop those alligators.

Mr Harnick: That is what happens when you are --

Mr Sorbara: Excuse me, Mr Chairman, while I file my teeth.

Mr Harnick: When you are here for five years you get like that.

Mr Sorbara: Can I do that in public?

Mr Harnick: Premier, one last item following up from one of Mr Scott's questions. He pointed out that you felt strongly at one point in your life about making sure there is access to the court system as there is in other provinces. Now, we have the opportunity to examine you here today. We may not have that opportunity again. You have told us to go ahead and make recommendations. My party wants to see what you people think should be in the next bill. If we recommend that access to the court system be available, will you give us your assurance that it will in fact find its way into the bill?

Mr Scott: He has already done that. Be careful, he may change his mind.

Mr Harnick: I am not so sure he did that.

Mr Scott: Oh, I think he did it.

Hon Mr Rae: Charles, let me be very clear. I suggested, for example, that instead of having a conflicts commissioner we should give it all over to the Commission on Election Finances. That is obviously not my view today. But for matters of historical record, I would be happy to leave with you the letter I wrote in August 1986 to Mr Aird and say to you that not only do I have no problem, I think it is entirely appropriate that if somebody, as a private citizen, wants to challenge or make a particular allegation and has the evidence to back it up and wants to proceed beyond the conflicts commissioner, that is something I would have no difficulty in supporting, if that is the direction people wanted to go.

Mr Harnick: Thank you.

Mr Carr: I want to go back to something that was mentioned earlier and has been brought up; I refer to the purpose of the guidelines, which is to increase the public confidence in the integrity of the government. The situation of Mr Drainville has been brought up and I was wondering how you reconcile that situation, having been in cabinet. How can you, for want of a better word, okay what he did and yet at the same time introduce this legislation which will increase the public confidence in the integrity of the government? I am having a little bit of difficulty understanding how you can reconcile those two, and I was wondering if you could go over it again for us.

Hon Mr Rae: I am sure everyone here knows as matter of record my own involvement with this issue.

Mr Scott: That is not the reason, is it?

Hon Mr Rae: No, it is not. But I might as well get it out --

Mr Scott: I am delighted to hear that; I was very nervous for a minute.

Hon Mr Rae: Since you and others are in the room, I might as well have it all out so we can all have all the facts out on the table and nothing is being said implicitly that should not be said explicitly.

Mr Scott: You did the same as Dennis, that is it.

Hon Mr Rae: I refer to the conflict over the Red Squirrel Road, which by the way the previous government decided not to proceed with in its wisdom, after there were several hundred arrests on the Red Squirrel Road. Mr. Drainville, prior to his being a member of the Legislature, was involved in being on the road.

Mr Scott: Worse for a member of the Legislature.

Hon Mr Rae: And, I guess, you make your judgement. He took a position which resulted in a criminal charge and he was convicted. The question is, is there a difference between that and other infractions of the Criminal Code? Is there a difference between an act of civil disobedience which one individual decides to do, knowing that there are going to be consequences, and committing fraud or theft or an act that would be described as one of moral turpitude, which I think would be the sort of formal or legal expression? I think there is; I think there is a distinction. My own judgement would be that it would be a mistake not to see the distinction. But I am prepared to take criticism and to accept the fact there will be people who will disagree.

Mr Carr: Let me use a hypothetical situation. If somebody was to rob a bank, but did it in terms of giving money to the poor, would that be one of conscience where you would allow that?

Hon Mr Rae: I do not think we have to deal with hypotheticals, Mr Carr.

Mr Carr: It is the same type of situation which you break the law or you do not, in my mind. It is obviously not in yours.

Hon Mr Rae: We have the difficult situations in front of us. What is your suggestion with respect to individuals who are faced with this situation? Are you saying that people --

Mr Carr: What I am saying is, if the purpose is to have public confidence in the integrity of government when you have people who break the law -- and I am not talking about charges; I am talking about after conviction -- and then you have a Premier who says, "That's okay, because maybe that law was meant to be broken," is it one of conscience if you rob a bank but then give it to the poor? I am having trouble following your --

Hon Mr Rae: No, I am saying that Mr Drainville is a parliamentary assistant. He is somebody who was elected to be the chairman of caucus. I think what happened to him and the decisions that he made and the reasons for him making those decisions are well known. I have made a judgement that this was not in any sense an act of dishonesty or anything of that nature in terms of what he did. He did what he did along with a number of other people because he felt it was the right thing to do and was prepared to take the consequences for doing so.

Mr Carr: I guess what I am saying is that you are talking about the purpose of the law being to increasing public confidence in the integrity and yet --

Hon Mr Rae: I do not think that anything Mr Drainville has done has decreased the confidence of the public in the integrity of this government or the integrity of government generally. I do not really believe that.

Mr Carr: I guess we would disagree. I will jump to another question, then -- maybe there is time for Charles -- and it deals with the case of Mr. Mackenzie and Mr Philip. One of the fundamental principles you have in there is, "Ministers shall at all times act in a manner that will bear the closest public scrutiny." In that situation you have a man like Mr Hinkley, who says one thing, and the minister says the other, and you say, "Okay, I believe the ministers." Yet when we wanted to have an open forum like this where we could call witnesses and ask them questions, you, for want of a better word, put the kibosh on it. I was wondering how you can say, under the fundamental principles, that the ministers will act in a manner that will bear the closest public scrutiny and yet when it gets down to it, you will not have any public inquiries where we can get to scrutinize some of the ministers. What do you say to the public about that?

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Hon Mr Rae: I think the public, on a daily basis and on a regular basis, does have an opportunity to judge and to make up its mind with respect to the conduct of ministers. If I can just say so with respect to another matter -- I think you were referring to Mr Philip and to Mr Allen -- it is a judgement that premiers make and for which premiers are either praised or criticized, depending on who is doing the praising or the criticizing, and that is the reality. We take these knocks on a daily basis. It was my judgement that they made a mistake; that in terms of the public scrutiny, the manner in which they discussed this after the cabinet decision was not terrific. I have said this to them. But again, I did not regard it as a capital offence. I did not regard it as a fundamental conflict. Despite the questions that were put to us in the Legislature and the vague kinds of statements made in the Legislature by some in the opposition, there is no evidence that I have seen of any kind that anybody benefited in any financial sense certainly, or indeed, one could argue, even in any political sense.

Mr Carr: Definitely not, and I want to apologize for saying "Mr Mackenzie." Of course it was Mr Allen, as you well know, so I apologize, thinking it had been in the Hamilton area. But what I am getting at is that here you come in with the legislation to build confidence in the integrity of the government when in fact your very actions are not doing that. In fact, we could probably go even further by the backtracking on the Agenda for People by saying, how can there be integrity when people make promises to win elections and then have to backtrack on them?

Hon Mr Rae: Again, let's separate out the politics of this from the --

Mr Carr: No, but integrity does not get split out like that. Integrity is there.

Hon Mr Rae: I agree. All I can tell you is that the people will judge us, and on a daily basis, with respect to our overall integrity. We will share views back and forth as to how well we are doing or how badly we are doing in completing our election commitments and other commitments we have made to the people of the province. That is a test you meet every day.

All I am saying is that every time somebody makes a mistake I think there has to be a judgement made as to how serious that mistake is, or if somebody does something that, for example, happened to Mr Drainville, the Premier and others have to make judgements as to whether or not this is something that is sufficient to cause a resignation or something of that kind. That is a judgement call you make.

Mr Carr: But, you see, I believed you when you said in the throne speech that while we make mistakes we all admit them --

Hon Mr Rae: And we have admitted them. If I can be very direct with you, I think we have admitted them as clearly as we possibly can. I have been very clear in admitting my mistakes.

Mr Carr: But the minister stayed. We are admitting that the minister is still there; the minister stayed in the case of the Hamilton situation, Red Hill Creek. We admit the mistakes.

Hon Mr Rae: Yes.

Mr Carr: The integrity of the whole system by situations like that --

Hon Mr Rae: I do not think that every mistake that a cabinet minister makes should lead to the equivalent of capital punishment in terms of leaving the cabinet.

Mr Carr: What I am saying is that if your job is to influence the public confidence and integrity of the government like you have said you have done, when you let incidents like this go out, the Drainville situation and the situation with Red Hill Creek, then you lose the credibility for everyone -- not just for yourself but for all politicians.

Hon Mr Rae: We will see. When we all make judgements on a daily basis about our lives, about our families, about our kids, in terms of trying to make judgements about standards and conduct, not every mistake we make as individuals is a huge one. Some of them are small ones. All of them are worth admitting. I would just disagree with you when you say that every time something happens this somehow casts a pall over the entire integrity process. I do not agree with you.

Mr Carr: It does. As a matter of fact, when I go out to the people --

Hon Mr Rae: I think it depends on how we respond.

Mr Carr: When you backtrack on your promises, you know what the people do; they blame all of us. They say, "All you politicians, you all make promises" --

Hon Mr Rae: Mr Carr, if I am causing you difficulties in your riding, I am sorry. I would be glad to come down and talk to your people and try to explain to them how we are doing. I am sorry if I am causing you difficulties politically.

Mr Carr: I will keep you to that, Premier.

Hon Mr Rae: The last thing I would want to do is cause you difficulties in your own constituency.

Mr Fletcher: I have just one question. Do you believe the conflict-of-interest guidelines should extend to all members of the Legislature, and if so, why?

Hon Mr Rae: Well --

Mr Scott: Did you hear him sigh? That may be your parliamentary assistantship. When a Premier sighs like that you are in serious trouble.

Mr Fletcher: I have been in trouble since the day I got here.

Hon Mr Rae: Derek, in answer directly to your question, I think additional guidelines should apply to all members. I am not persuaded that complete divestment rules, for example, could or should reasonably be expected to apply to all members of the Legislature. I think that would be unduly difficult and an undue imposition of duties on a member of the Legislature. At the same time I do think, for example, the phrase "private interest" needs to be clarified, and I think some of the restrictions on acceptance of gifts and benefits and so on need to be made clearer. I think the principle of more frequent disclosure is the issue on which I would like to hear from the committee -- and again it is something that members need to express themselves frankly on -- as to whether the commissioner should be expected to make public even more information that he receives. As you all know, the commissioner receives a lot of information and then he issues statements about categories with respect to what members' interests are, but he does not have to disclose amounts or even ranges of amounts.

Those are things that I think need to be tackled again by the committee, and I would like to hear from the committee on those views, because I think they are very important to hear from people on.

Mrs Mathyssen: Premier, in part D of your suggestions to the members of this committee you suggest a need to strengthen regulations on activities of members after leaving office. Once a member leaves public life, I suppose he or she would be ostensibly a free agent. I was wondering, to what situation could this particular clause relate, and how did you anticipate regulating the activities of former ministers, PAs and MPPs?

Hon Mr Rae: Principally I was thinking of former members of the executive council, of former cabinet ministers. Section 18 of the current act sets out the principle that there is a 12-month expiry period during which activities of former cabinet ministers or members of the executive council are limited. We also have the issue which deals with the Public Service Act, which I think it would be also appropriate for members to think about, and that is the question of former deputy ministers who very quickly can become involved in the very industries which they were regulating, and it is a problem.

Having said it is a problem, the answers are not that easy to find, because you can put a quarantine period on of a year or you can extend it for two, but obviously the thing you are trying to avoid is a situation where, in anticipation of a future benefit, people's decisions are influenced in some way. It is a situation that is easier to describe than it is to figure out what law you can have that will deal with it. Whether it should also apply to members of the Legislature or not, I do not know. My own view would be that this is pretty onerous, and it would be pretty hard to make a rule like that really work or stick. But that is the kind of situation I was thinking of.

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Mr Morrow: First of all, Premier, I would like to thank you for coming here to sit with us for this hour and a half.

Hon Mr Rae: It has been a pleasure.

Mr Morrow: A very brief question: What type of investments can cause conflicts?

Hon Mr Rae: The origin of the conflict legislation in this province was, I think everyone knows, land dealings by cabinet ministers which became publicized after they were disclosed. This is before there were any requirements on the creation of trusts or anything else, and obviously decisions of cabinet in respect to zoning and land development and things of that kind have a real impact. So that is one area.

The view has been that as much as possible one should be hoping that private business dealings or private business ownership or corporate ownership can create situations in which there is the potential for conflict. One only has to read the newspapers to understand what this potentia! is in terms of the perception that there is a mix between public and private business. Whenever there is a sense of a mix between public and private business the concern is that one is using public office to advance a private interest.

I would urge the committee to call on Eldon Bennett, who has been very much involved with Mr Aird in bringing forward his recommendations. I would urge the committee to talk to Mr Bennett, not because he agrees with my views but because he is somebody whose views I have come to respect a great deal. He has made it very clear that the question of a private interest cannot realistically be restricted only to the question of economic benefit; it extends beyond that.

Mr Sorbara: I just want to ask the Premier whether he has ever owned a business.

Hon Mr Rae: No. I think my economic circumstances are well known.

Mr Sorbara: It is okay. I just want to know whether you have ever owned a business.

Hon Mr Rae: No.

Mr Sorbara: In your practice of law, did you ever act for clients who bought or sold a business?

Hon Mr Rae: Yes.

Mr Sorbara: Was that a big part of your practice?

Hon Mr Rae: No.

Mr Sorbara: So how many businesses have you been involved in from the perspective of a lawyer, acting for a seller or a buyer?

Hon Mr Rae: Oh, a few. I cannot give you a list, but --

Mr Sorbara: Do you know what a shotgun clause is in an agreement of purchase and sale or in an agreement as between shareholders?

Hon Mr Rae: Yes.

Mr Sorbara: Could you explain to the committee what a shotgun clause is?

Hon Mr Rae: When someone has to sell to someone else or someone is required to sell to someone else, that is the term of a partnership or the term of a shareholder agreement; something of that kind.

Mr Sorbara: It is close. That is sort of a B-minus answer.

Hon Mr Rae: Oh, I am sorry.

Mr Sorbara: It is. A shotgun clause is a very --

Mr Harnick: He still passed the bar exam. It does not matter.

Mr Sorbara: Under your guidelines, at least until we have different guidelines or legislation, you would make the decision about whether or not a minister would have to sell his or her business. Let's say a minister said to you: "Premier, there is a shotgun clause in my agreement with my partner. I only own 49% of the business and if I have to trigger that shotgun clause, I have to suffer a loss of, let's say, $100,000, because he can set the price." You have to make a decision under those circumstances. What would you do?

Hon Mr Rae: I would be guided first of all by two things: the wording of section 15, which I think you might have a look at --

Mr Sorbara: Yes, I have read section 15.

Hon Mr Rae: -- which says they are required to divest "except where the minister satisfies the Premier that the interest has been fully disclosed, that undue hardship would be created by divestment, that retaining the interest is not inconsistent with the public interest and that the minister has given appropriate undertakings to avoid a conflict in respect of the interest." I know what I am saying, so my answer to your question --

Mr Sorbara: I am putting a hypothetical situation to you.

Hon Mr Rae: My answer to your question would be that this is precisely the reason why we have the exception clause. The reason we have exceptions is precisely in order to avoid the kinds of hardship you are describing.

Mr Sorbara: Okay. Does this constitute an exception, then? Your minister, whom you very much want to have in the cabinet --

Hon Mr Rae: I am not going to answer that on the basis of a hypothetical, because I would have to take a number of other considerations into account.

Mr Sorbara: Like what, for example?

Hon Mr Rae: All the other circumstances surrounding the case.

I would also be relying on the advice of the conflict commissioner with respect to the fairness of the --

Mr Sorbara: Hold on a second. The guidelines say you make that decision.

Hon Mr Rae: I have also made it --

Mr Sorbara: Name me three other circumstances that would impact on your decision.

Hon Mr Rae: No. I think I have answered you as clearly as I can.

Mr Sorbara: You are not saying anything, with respect.

Hon Mr Rae: I am. I am saying that the reason we have exceptions and exemptions is in order to deal with situations of that kind. I do not think it is terribly helpful to get into a whole bunch of hypotheticals. What other kinds of situations was I thinking of? Not only situations of that kind, which would be one potential; other ones would be where, for example, because of a total change in market circumstances, to require somebody to sell at a certain point would mean the person would suffer an enormous loss.

Mr Sorbara: What is an enormous loss? How much does it cost to be in your cabinet? How much?

Hon Mr Rae: You should ask some of my cabinet ministers. I do not know.

Mr Sorbara: But you have said publicly that most of your cabinet ministers do not own any assets. I am asking you, how much does it cost to be in your cabinet? For example, if a potential minister had to experience a 20% loss in the value of his assets, is that too much? Is that undue hardship?

Hon Mr Rae: Mr Sorbara, let me answer you very directly. You say, "How much does it cost to get in your cabinet" --

Mr Sorbara: No; one would suffer a loss if the market conditions were bad.

Hon Mr Rae: There are many other situations where I can describe people as suffering losses from going into public life generally.

Mr Sorbara: There is no doubt about that.

Hon Mr Rae: Most of the lawyers in the Legislature who are not practising law privately --

Mr Sorbara: Yes, we are all making less than we would outside. I agree.

Hon Mr Rae: -- and most of the doctors and a great many in the professions, a great many people in business.

Mr Sorbara: I hear you, but I am talking about your guidelines. You have to make a decision as to whether or not it represents undue hardship. If a minister says to you, "I'm going to lose about 20% of my net worth," what would your decision be?

Hon Mr Rae: I do not think I can answer on that kind of level except to say that --

Mr Sorbara: That is what the minister is going to come to you and suggest.

Hon Mr Rae: That is right, but I mean --

The Chair: Mr Sorbara, you were able to treat witnesses last week with some respect.

Hon Mr Rae: I will just say very directly to Mr Sorbara that where that kind of situation exists and where there is a feeling that this would work an unusual or undue hardship, that is precisely the situation where you would create the exception with all the rules that are there. You will be in a position to make that judgement, along with others --

Mr Sorbara: In about four years.

Hon Mr Rae: It may even be sooner than that; anything is possible in that regard.

Mr Scott: The Premier will have to leave us soon and I just wonder if I could follow up a question that Mr Carr raised before he goes, because the Drainville case is a very troublesome case for a number of us. I am entirely sympathetic to what the Premier says about the difference in cases, and there is also some recognition in our law that even if you have sinned you have not sinned for ever; you do not pay the price for ever. The Premier says you have to look at the motivation and there will be differences of opinion. The Premier's opinion, which I respect, is different than the trial judge's, because the trial judge concluded this was sufficiently contumacious to require an imprisonment. There is an appeal, so we should all bear that in mind, to be fair to Mr Drainville.

But would the Premier agree, as a matter of principle and perception at this stage, that should this appeal not succeed and should a sentence of imprisonment result, that it would not be possible, for example, for Mr Drainville, wherever else he may serve, to become the Attorney General or the Solicitor General of the province or a parliamentary assistant to either of them?

Hon Mr Rae: I think you are putting an impossible question to me, Mr Scott, because there are several levels of hypotheses. First of all, as you have quite rightly pointed out, the issue of sentencing is now being appealed. Second, I think I would have to reflect on that quite seriously and look at it in all of its consequences before being able to answer. I cannot give you a quick, short answer.

Mr Scott: There are lots of other cabinet jobs, Premier. I just think, consistent with Mr Carr's concern, that it would be a matter of very great confidence to the public to know that a contumacious breach of the Criminal Code, while it might not disqualify you for a lot of other wonderful jobs in public service, would make it very difficult to run the police force or the administration of justice in the province. I think we would like to hear that from the Premier, just as a matter of general impression.

Hon Mr Rae: I am not going to satisfy you today, Mr Scott, but I am going to take your views under advisement very seriously. I can think of a lot of situations where as a general rule -- it is a good idea to avoid making general rules; I would have to look at the situation, and at the circumstances --

Mr Scott: You have recommended a few for us.

Hon Mr Rae: But I hear what you are saying and, as in all things, I take your view seriously.

Mr Harnick: Premier, one of the things that concerns me about the Drainville matter is the fact that he having been convicted and having appeared at the time that he was sentenced and not showing any remorse for what the court found, how can you then not come to the conclusion that he has been disrespectful to the system of justice? That is what bothers me about it; it is not the fact that he did it and he did it in good conscience. But now he has been determined by a properly constituted court to have done something wrong and contrary to the Criminal Code, and he has shown no remorse. I would be very concerned about that. He belittles the system of justice.

Hon Mr Rae: I think that until the question of Mr Drainville's sentencing is resolved by a higher court, it would be wrong of me to comment any further.

Mr Harnick: I am not asking you to comment on the sentence. The fact is, he has been convicted.

Hon Mr Rae: Your comment is on the record and I think other members will have their views as well, but in terms of any further comment by me, it will have to wait that next stage. Mr Chairman, thank you very much.

The Chair: I would suggest that we adjourn for a couple of minutes.

The committee recessed at 1432.

1444

CONFLICT OF INTEREST COMMISSIONER

The Chair: Although we do not have our full membership here, I would none the less like to welcome Commissioner Gregory Evans from the Commission on Conflict of Interest.

Hon Mr Evans: I am Greg Evans, the Conflict of Interest Commissioner, and this young lady is my executive assistant, Lynn Harris. I think you have all met her.

Mr Poirier: We have all met you also.

Hon Mr Evans: You only go to confession once a year, so it is not too bad. But my responsibility as the Conflict of Interest Commissioner, as I see it, is to assist the members of the Legislature in advising them with respect to their obligations under the act, identifying areas of possible conflict of interest and providing advice to either prevent or resolve the conflict. In addition, I am empowered to investigate complaints made in conformity with the act.

It is also my responsibility to prepare and file members' public disclosure statements on an annual basis. The most recent disclosure statements, as of 19 September 1990, were filed with the Clerk of the Legislature last Thursday. Very dull reading, I can assure you; so I do not think it will get much play in the newspapers. But I am pleased to advise that the members were very co-operative in fulfilling their obligations and that all have complied with the act. I might say in passing that some would prefer to say, "Same as last year," but we do not permit that. Next year, anything that comes in like that is going to go back; so please, give it a better whirl than that "Same as last year."

With the introduction of the Premier's guidelines on 12 December 1990, he requested that I provide whatever assistance I can consistent with my statutory authority and my independence as an officer of the Legislative Assembly. To this end, I am also pleased to advise that, in my opinion, all members and ministers and parliamentary assistants have complied with the Premier's guidelines, with the exception of three parliamentary assistants. These three members were granted an extension for divestment and their efforts to comply continue to be monitored by my office. You will understand that my function is to operate within the confines of the act. The Premier is entitled to make whatever guidelines he sees fit, as any Premier I suppose is, for the members of his cabinet and parliamentary assistants. What I was doing there was to help him with the concurrence of the members of his executive council and parliamentary assistants, so in that respect I was assisting him.

I am here today to respond to your questions with respect to the Members' Conflict of Interest Act and, in some ways, with respect to the Premier's guidelines; very limited, though, I suspect, with respect to the guidelines.

The Ontario act has generated a great deal of interest in many of the provinces and as far away as Trinidad and Tobago and New Zealand and has formed the basis of legislation in a number of jurisdictions. However, like any new act, in my opinion, that act is not without some problems, some faults. In late 1989, after 16 months of responding to 63 inquiries and filing two annual disclosure statements, I submitted for consideration by the Legislature comments and suggested amendments to the act. For your convenience, I prepared a chart setting out the act and these comments, and I believe you all have a copy of it. Subsequent to that submission, and over the past year, I have made additional comments which are shown in italics. I have also prepared a similar document with respect to the Premier's guidelines which may be of some assistance to you.

The present legislation is an attempt to balance the need to maintain high standards of ethical conduct in the public service without unduly inhibiting people of outstanding ability in the private sector from seeking public office. The integrity of any political system, however, depends on the honour and integrity of the elected officials. We all know that morality cannot be legislative, and my position as commissioner should not remove responsibility for compliance from the member and transfer it to the commissioner. I think the member is ultimately responsible. But my two and a half years' experience as Conflict of Interest Commissioner have been interesting and challenging and I hope that the experience which I have had will assist you in your deliberations with respect to the act and the guidelines.

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I may say that I have received excellent co-operation from all members. Some we had to jog a little bit to get them in there and some we had to jog their memories, though it was unusual. Everybody knows their liabilities but many of them, I think for the first time, discovered what their assets were. It is understandable, because if you owe money everybody is writing to collect it, but if you have assets the bank does not call you up to tell you that you have money in the bank and how much.

So I do say that the members, for a new act and for the first time, this idea of going to confession, I am sure, may have disturbed some. What I have tried to do is keep this office small. I think if you go to confession you do not want to hear it out on the street, and that is why we have Miss Harris, who worked with me when I was a Chief Justice and has had considerable experience in these matters, and occasionally we have one assistant who will come in on a part-time basis. We want the files to be kept secret and we hope to have some legislation permitting us to get rid of the files after a reasonable period of time so that --

Mr Poirier: But not the members, just the files.

Hon Mr Evans: There is another agency that looks after that.

With that, I think I am available for whatever assistance I can give you.

Mr Scott: I would just like to ask two questions. I am conscious, Chief Justice, that you would not want to and would not feel, in your present life, any capacity to answer political questions, so I will try to avoid those in so far as I can.

Hon Mr Evans: Good

Mr Scott: I happen to know something about the draftsmanship and form of the act you are administering, and let me tell you that, in drafting the act, we tried as best we could, and there may be failures, to define what we meant by conflict of interest. That occurred for the very practical reason that at the time the act was being prepared people were talking about two things: a conflict of interest and a perceived conflict of interest. The trouble with that is, some people thought that even if you did not have an actual conflict of interest you could have a perceived conflict of interest. The trouble with that is, the question really becomes "perceived by whom?" Sometimes it is perceived by the newspapers; sometimes it is perceived by a Premier; sometimes it is perceived by somebody else. So we left out "perceived conflict of interest."

In the guidelines, on the other hand, this notion of a perceived conflict of interest -- that is, something that is not a conflict of interest but is perceived to be a conflict of interest -- comes back. Can you give us any help on how you define a perceived conflict of interest, accepting as a start-up that it would not be an actual conflict of interest?

Hon Mr Evans: Of course, as you have indicated, that is a very subjective matter. If a member has $100,000, A will say, "That person would never be corrupt because he has all the money he needs." On the other hand, B will say, "How did he get it?" and therefore, "He must have been dishonest at some stage." I do not know how you look into the perception business. It is the newspapers would believe one way and one journalist would believe one. Many of them have partisan approaches to these things. I think that would be very difficult to administer.

Mr Scott: Yes. One other question about divestment. Under the Premier's guidelines, which you have seen, in order to serve in cabinet or as a parliamentary assistant you have to either have no significant assets or be prepared to divest yourself of the ones you have or get a go-by from the Premier for the reasons that are set out in the paragraph.

We are talking about a world, by the way, in which everything is disclosed, so everybody knows what you have, and we are also talking about a world under your act where a declaration, "I am in conflict and cannot vote," has to be made, whether it is in the Legislature or in cabinet. But the divestment requirement, which is superficially so attractive, it seems to me, means that office in the Legislature or office in the executive council is going to be open only to Ontarians who either have no assets or can divest themselves of them, or get this go-by from the Premier, and the idea that the assembly is a collection of citizens representative of the whole community is in trouble. Are you familiar with any other jurisdiction that has a divestment system like this?

Hon Mr Evans: I do not believe there is any. I believe the federal bills that have been floating around for some years are still in limbo. I think they were advocating divestiture.

Mr Scott: Have you heard of any others anywhere in the world?

Hon Mr Evans: No, not that we have come across. We have most of them. That is a pretty rigorous -- and as I stated one time before I saw the guidelines, maybe the only candidates for cabinet are going to come from Millhaven or Penetang one day.

Mr Scott: I certainly will not touch that observation with a 10-foot pole.

Hon Mr Evans: I think it is a pretty draconian measure.

Mr Scott: Having known you for a long time, I know divestment never caused you any trouble as you had about 13 kids and divestment was automatic at source in your case.

Hon Mr Evans: Way ahead.

Mr Scott: But how are we going to grapple with the problem that there will be some people who have done well in this world in their communities, who have made a good living, and who are asked to make a sacrifice in terms of divestment that is really quite extraordinary in order to serve for a month, two months, three months, or four years in a cabinet? One of the concerns I have is that it is getting tough enough for all parties to get good representative candidates to run for office; we are sort of closing down the avenues because people out there are now going to be told, "Look, if you've accumulated any assets you can certainly run for office, but don't expect that you'll ever be able to get into the cabinet, because you'll have to sell them, leaving nothing that grows for your old age."

Hon Mr Evans: I agree with you. I think it would be very difficult. The only thing I can say is that I suppose each Premier, as he comes in, has the right to set certain rules for his cabinet and parliamentary assistants. But I think on some occasions parliamentary assistants stayed in for only three or four months and then were gone; their tenure is about as good as a National Hockey League coach.

Mr Scott: Even worse, if I can put it this way, the previous Premier decided that all parliamentary assistants should change every six months so that everybody would have part of the experience. It is going to be very tough for parliamentary assistants under this regime because they will have to sell their assets in order to get six months' worth of experience. Pretty tough stuff, do you agree?

Hon Mr Evans: I think it would be, yes.

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Mr Sorbara: Excuse me, Mr Chairman, are we not allocating time?

The Chair: Given that we have a fair bit of time and we are not time-limited, I suggest we rotate the questions among the caucuses as opposed to allocating time.

Mr Carr: I have a question regarding number 18, gifts and benefits. I have a particular case here --

Hon Mr Evans: Are you talking about the guidelines or in the act?

Mr Carr: The Premier's guidelines in the left-hand corner. It relates to a particular situation. I was wondering how it can be handled or what you suggest. It is a case where an artist in my riding gave the former cabinet some -- how should we describe it? -- birds as a gift worth about $400. It was done during a cabinet presentation and some of the cabinet ministers came in and they got left in the box. We are now in the situation where the artist wants his gifts back, and these things are literally lost somewhere.

It makes it very difficult when you are talking about gifts because, under this law, he would say they got them and they should have declared the birds as gifts exceeding $100. But the fact is that when most of the cabinet ministers left that meeting, the birds sat in the box and they do not have them any more. I was just wondering, when it comes to gifts and benefits like that, how practical it is to get into something in terms of gifts and so on down that low. Have you found it very difficult to enforce these types of things?

Hon Mr Evans: No, we have not. We have had this situation where an artist would give a member a painting. The artist thinks it is worth $15,000 to the member. I took the position, "What is the value of the frame?" The painting is of no value to anybody else except that particular guy. The value is the artist, and if the member would get his wife or husband convinced to hang it up in the house it would be a miracle, probably.

I did not really have too much difficulty with them. The only thing I consistently said is, "If you see a developer coming, run." But people get tickets to certain things and they are worth $300, but most of those tickets have a dinner value of about $50 and the other part, $250 or whatever, is an income tax exemption to the person who buys the ticket and not to the member. So I did not consider it was a $300 gift; I figure it was about $50. Where you can stand the rubber chicken, you go. I did not really have much of a problem with that.

Mr Carr: So the disclosure of gifts is not a big problem.

Hon Mr Evans: No, it has not been.

Mr Mills: I guess, Judge Evans, I agree with the remarks that you made. Being a parliamentary assistant, there is a tremendous price to pay for some people for a tenure of office that, to say the least, is precarious. I think particularly, if I am a lawyer, that I sell my law practice and down the road I am gone and the money I earned being a PA in no way compensates for that. To get to the point I am trying to get to: Mutual funds, I believe, are fine for someone to have. Right?

Hon Mr Evans: Some of them.

Mr Mills: Some of them. But a blind trust is not allowed. I just wonder, a mutual fund is administered at arm's length and the blind trust would be the same manner. Why would one be acceptable and one would not be?

Hon Mr Evans: I think the blind trust has probably fallen into disrepute because everybody thought it had too many eyes; there really was nothing blind about it. If you have certain assets and you know what they are, you turn them over to a trustee and you still know what he has. If he sells certain ones and then replaces them, you still know what he controls. So I do not think it is any great advantage to have a blind trust. If you put your money into treasury bills or something like that, I do not think that is any problem, or if you put it into a mutual fund where you have no control over it, or if you put it into a mutual fund where I think it is called not an open-ended one but a closed one, where it just deals in specific types of stocks and has a limited membership of shareholdings.

I think it is very difficult to really put all this aside in the hands of an independent trustee unless you are going to pay that trustee, and he should be paid, I presume by government, to manage those affairs quite independently of you. It is very difficult if you run a small business and you developed it and you turn that over to the trustee and the trustee may feel, "Oh, this is a really good business offer coming in to sell the business." I think a trustee would think a long time before he would sell it without your approval. You may not want it, so you may want to keep it for your son or son-in-law or somebody else. There are problems with any kind of trust that you set up. You can put your money into certain things, but you could put them in there yourself, without the trustee, into government securities, whether provincial or federal or something of that kind. That does not create a problem for you. I do not know whether it creates a problem if you have a small number of shares in a publicly traded company. I do not see that 200 shares of Bell Canada are going to give you much right to direct the manner in which Bell Canada carries on its business.

There is a difference if you have a private company, and particularly a numbered company, where you cannot really tell from the look of it what that company is engaged in unless you do some searching. I think that is a different situation. But even then, if you are a minority shareholder you do not have too many rights to ask in which direction the company is going. If you have a trustee, I do not think he has any rights or he may have trouble finding out just what is going on.

I do not know whether I have answered your question. I have rambled a bit. I thought I was a politician for a moment.

Mr Sorbara: In this room you can be forgiven.

Mr Mills: It is a wonderful answer. All I hope is that I can remember it, because I am not here asking that question for myself, but on behalf of a colleague who asked me to pose it so I could report back to him. He could not be here. So I hope I can grasp whatever you said.

Hon Mr Evans: What we have tried to do is to have people write in and put a question to us, but we like it not hypothetical, "What would I do if such-and-such happens?" Give us a factual situation and we will give you an answer. Hopefully it will be correct, but if not, then you are at least protected by the fact that we write back and say, "This is what we can give you."

I think more people are writing in. We do not like a phone call at the last minute. We try to give you an answer if it is urgent, but then we ask you to please write and then we will confirm it in writing, and most of them have done that. The only ones we have trouble with, I find, are those who have been on municipal councils. They just used to call up and away you go, there was nothing to it. We have to impress upon them that the days of whisky at Christmas and the turkey at Thanksgiving or a trip to the Rose Bowl are no longer done.

Mr Scott: Oh, they are a bad bunch, those councillors.

The Chair: Before Mr Sorbara's question, there are copies of Mr Rae's letter, I believe, to Mr Aird. It will be circulated.

Mr Sorbara: Let me begin by saying that we are glad, all of us, to see you here at this committee. I will call you Commissioner, although my friend calls you Chief Justice and you --

Mr Scott: Just in case he ever gets back.

Hon Mr Evans: It is not what he always called me.

Mr Sorbara: I think there are many tributes we could pay you, because you have spent a number of years serving the province and, in your current capacity, one that is, if not an enormous burden administratively, certainly a very politically tricky one, I think you would agree, in the sense that there are some difficult judgements for you to make at times.

Hon Mr Evans: Always. For 25 years I was doing it, and for 25 before that as a lawyer I did it; so you make your judgement call, hoping you are right.

Mr Sorbara: Just to fill in some of that background, during the time that you practised law, did you ever practise any corporate or commercial law?

Hon Mr Evans: It was in Timmins; there are not too many corporations. I did some but, I must say, not many. I got a real course in administrative law, partly through speaking with you and some of the accountants who came in, Joan Smith and others, in the past few years. I really got a course in corporate law. I think I could pass the bar exam now.

1510

Mr Sorbara: For the benefit of the committee, you have been sitting as the commissioner since when?

Hon Mr Evans: Two and a half years.

Mr Sorbara: Two and a half years -- really since the act was passed and proclaimed.

Hon Mr Evans: Proclaimed, yes.

Mr Sorbara: So you have been through about two years under a Liberal administration and close to six months under a New Democratic Party administration.

Hon Mr Evans: That is right.

Mr Sorbara: Is it safe to say that there is not much difference between the two, from the perspective of your work?

Hon Mr Evans: When they come in the door, I do not know who they are and I could not care less. That is about the attitude. Looking around the table today, in fact, I see your names and I know you are sitting in the Legislature, but I try not to remember. Some people I do know from past experience, but most people I do not know. When they come through the door, I assume they are all honest and wanting to do a job.

Mr Sorbara: In that you are certainly right.

You have provided us with a copy of the 1987 act, along with the commentary, and this is your commentary after two years of experience with the bill.

Hon Mr Evans: Right.

Mr Sorbara: I take it that you would be delighted if this committee could spend some time examining in detail your recommendations and include them in our recommendations to the government when we reconsider this act.

Hon Mr Evans: I would like you to take a look at it anyway.

Mr Sorbara: I would not mind going through some of those with you in just a few minutes, but for the time being, suffice it to say that these are the sum of the changes you would suggest as a result of your experience with the act.

Hon Mr Evans: That is right.

Mr Sorbara: Okay. The Premier told us this afternoon that when he introduced these guidelines, he temporarily put himself in the position of decision-maker in respect of disclosure and some other items. The guidelines were introduced on 12 December 1990, just towards the end of the first session of Parliament. Did you have any discussions with the Premier beforehand about his conflict-of-interest guidelines?

Hon Mr Evans: No.

Mr Sorbara: So he did not --

Hon Mr Evans: Well, we had a comment on the letter he sent, but that was all. The guidelines were already set out in it.

Mr Sorbara: So he did not ask you whether or not you would be prepared to make the decisions that he set himself up as making in these guidelines?

Hon Mr Evans: I did not think I was entitled to ask him that or say anything to him about that. I thought every Premier has the right to set whatever guidelines he wants for his cabinet and parliamentary assistants. I did make a few suggestions, as you will see.

Mr Sorbara: On these comments on the guidelines; but these were made and the guidelines were considered by you after they were announced in the Legislature.

Hon Mr Evans: A couple of months before that, before the end of November, I had one letter from him in which he stated, "I am writing to confirm it is the government's intention to introduce amendments to the legislation." Then he said: "The new act will deal with parliamentary assistants. I am going to communicate with them and ask their okay to discuss it with you," and so on. I did receive a copy of the guidelines and I responded to that on 7 December. I asked certain questions concerning the guidelines. I wanted clarification of it so I could --

Mr Sorbara: So you received a copy of the guidelines on 7 December?

Hon Mr Evans: Yes, I did.

Mr Sorbara: And you were asked to comment?

Hon Mr Evans: Yes.

Mr Sorbara: Not to get into the detail of your commentary, but in the letter from the Premier, did he ask whether you would be prepared to make a decision as to whether or not an individual minister or parliamentary assistant would have to divest?

Hon Mr Evans: No.

Mr Sorbara: I am not sure whether you want to answer a hypothetical question, but I am going to ask it anyway and you can just make up your own mind on it. Section 15 of the guidelines says, and if we could turn to them, I will quote from them. The initial statement is that: "Ministers are required to divest themselves of" -- if I could summarize, everything they own of a business nature -- "any asset, liability, or financial interest which causes or could appear to cause a conflict of interest; and all business interests." That is just about everything, would you not agree?

Hon Mr Evans: Yes, practically everything.

Mr Sorbara: And then there is the caveat clause, which states that "except where the minister satisfies the Premier that the interest has been fully disclosed..." etc and if undue hardship would be created.

In his testimony today, the Premier suggested that it would have been inappropriate for you, as commissioner, to make that decision as to whether or not the interest had been fully disclosed, that there would be undue hardship, etc.

My hypothetical question is this: Had the Premier asked you to take on those new responsibilities -- that is, to determine where divestiture would be necessary -- would you have refused to take on that new assignment?

Hon Mr Evans: I think I would wait for legislation. I do not think I should be jumping around because the Premier says certain things. I think my responsibility is to the Legislature, and I would think that --

Mr Sorbara: To only act under the Legislature?

Hon Mr Evans: Right.

Mr Sorbara: But there are instances in here where there are some new responsibilities for the commissioner; we could get to those later. I just noted in passing that you are referred to in here, or the office is referred to in here, for example, in section 28:

"Where the commissioner has recommended a course of action to a minister in relation to an actual or potential conflict of interest, the minister shall immediately advise the Premier of the situation and the commissioner's advice."

You have disclosed that divestiture is a rather final remedy.

Hon Mr Evans: I said draconian.

Mr Sorbara: A draconian remedy, I think you said. In your experience, given the number of disclosure statements that you have seen, as a practical matter do you think divestiture is a realistic option?

Hon Mr Evans: No, I do not.

Mr Sorbara: Neither do I, as a matter of fact. I think it is important that the committee hears you say that without taking sides on the issue --

Hon Mr Evans: I just want to qualify it to this extent: I think divestiture of certain assets may be required, but I do not think complete divestiture is practical.

Mr Sorbara: For example, if you have a 12% interest in a piece of land, how does one divest that? If a member said to you, "How do I get rid of this? I want to serve in Bob Rae's cabinet," would you be able to advise him on that?

Hon Mr Evans: I think all I could say is, if the Premier insists on this, if that is a precondition of your appointment to cabinet --

Mr Sorbara: You will have to do it.

Hon Mr Evans: He will have to do it.

Mr Sorbara: But I notice in --

Hon Mr Evans: With a 12% interest, you are not going to get very much. It is a distress sale, if you wish.

Mr Sorbara: I notice in your commentary on the act, there is a wonderful little line in here -- I am reading from page 6: "The tenure in office of a cabinet minister is about as secure as that of a coach or manager in the National Hockey League." I take it you would not be offended if I suggest to you that the tenure is even less secure than that?

Hon Mr Evans: I think I probably made this comment before the election.

Mr Sorbara: Yes. Well --

Hon Mr Evans: I know I did.

Mr Sorbara: I am not done yet. What did you mean when you made that comment? What were you thinking about?

Hon Mr Evans: I understood that there was a policy, and I know there is in certain jurisdictions, where a parliamentary assistant stays for three months and moves on. Certain parliamentary assistants, according to the conversation I have had with some, get plenty of work to do and become involved in legislation if their minister agrees, and there are others who get very little work to do.

If you are trying to rotate it through the so-called backbenchers, then you would not be in there very long. It has nothing to do with whether you were competent or not. If that was a policy, to change every three or four months and move you to another ministry or out and have you supported by somebody else, then -- if you did that, it would be a pretty tough job to pick it up after three or four months.

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Mr Sorbara: Even as a cabinet minister, would you not agree that it is the case that one unfortunate comment by a cabinet minister about thus and such, and he could see his or her career as a cabinet minister come to an end rather quickly?

Hon Mr Evans: That is true.

Mr Sorbara: And had he or she divested his or her assets, the financial losses might be very significant indeed, because divestiture at arm's length means you cannot get them back.

Hon Mr Evans: That is right.

Mr Sorbara: Just to reiterate, on the question of divestiture, you were not consulted by the Premier about your views on divestiture.

Hon Mr Evans: I think I have stated that the Premier will be very busy, that is under divestment, and undue hardship will vary according to the financial position of a particular minister. I take it if a person had $500,000 worth of real estate and had to sell it and lose 20%, that might not be quite as bad as a man who has $5,000 and has to divest. That is what I was referring to. Undue hardship is what? That becomes very difficult. That is the problem with it.

Mr Sorbara: Since the guidelines were introduced, has the Premier contacted you about the possibility of you assuming the responsibilities that he assumes to himself under section 15?

Hon Mr Evans: No. I just assumed that it would have to come before your committee and then recommendations would go to the Legislature, which would then pass upon it, and if it is included in the act, fine, try to enforce it.

Mr Sorbara: What would your recommendation be to this committee, if section 15 is going to be incorporated into the act, as to the responsibility for determining undue hardship or sufficient disclosure -- in other words, all the things in section 15? Should that responsibility, in your view, lie with the commissioner, with the Premier, with a combination of the two or with someone else?

Hon Mr Evans: I think it can be done, but I think you would have to make it by way of exemptions and giving a lot of discretion to the commissioner. I am not so sure the Legislature would be willing to do that. That is putting quite an onus on the commissioner, but if that onus is given, he will have to discharge it as best he can.

Mr Sorbara: Let us assume that section 15 becomes the law, except that where it reads "satisfies the Premier," the words are "satisfies the commissioner." How would you determine whether or not there was undue hardship? I am sorry, it is a speculative question, but would it be a 20% loss of value or a 10% loss of value? How does one evaluate undue hardship?

Hon Mr Evans: I would not know what an undue hardship is. I think there should be something better than that outlined to the commissioner. What is undue hardship? I do not know whether it is 20% or 10%, or whether it is starvation wage or what.

Mr Sorbara: These are the questions that we are going to be wrestling with, I guess, and if we can --

Hon Mr Evans: I thought if the collective minds of the Legislature were put to it, I am sure they would come up with an answer.

Mr Sorbara: What was that comment about Millhaven and where else?

Hon Mr Evans: Penetang.

Mr Sorbara: Penetang. Mr Chairman, I do not have any other questions at this time. Before we finish today -- I am not sure --

The Acting Chair (Mr Fletcher): We have lots of time, Mr Sorbara. We can come back. There is no problem with that.

Mr Sorbara: It may even be that the commissioner would revisit us, because I think we are seized of this matter until we --

The Acting Chair: You have raised some good points. Thank you.

Hon Mr Evans: Just so you are aware, I am going to be away for three weeks.

The Acting Chair: That is all right, we will make sure we come and get you.

Hon Mr Evans: Okay. I will be away probably three weeks or a month.

Mr Harnick: The act indicates that you are the person who receives the disclosure. You then undertake the investigation and, in turn, you make the decision. Having read some of the earlier debates when this bill first came before the Legislature, there was some concern in the commissioner being charged with all of those duties and being able to be perceived to carry out each task and provide the hearing or the forum so that someone could say they had their day in court. You heard the Premier earlier this afternoon indicate that he believes there should be some recourse to the courts. Can you tell us, essentially, how each of these functions are in fact dealt with and what court application should be available?

Hon Mr Evans: I think the further you stay away from the courts the better off you are going to be, because there is no quick way of getting matters before the court. At that time, the problem was either augmented or gone. I do not see any particular reason to go to the court.

Mr Harnick: What about by way of appeal from a decision you might have to make?

Hon Mr Evans: That could pretty well destroy the commissioner's office in a very short time. As I see it, anyway.

Mr Harnick: You, then, would differ with the Premier -- that is obviously an issue we are going to have to deal with --

Hon Mr Evans: I think you have to ask yourselves what is the advantage of going to the courts, because actually the Legislature is the final court; you people make the final decision. I make the recommendations. If you do not like the recommendations, I am not going to be hurt about it. But I think it is you rather than a court that should make the final determination. All I do is make recommendations in most instances and whether a court would be any better, I doubt it.

Mr Harnick: The difficulty, I suppose, with the Legislature making the final decision is that it all comes down to numbers and you may not --

Hon Mr Evans: So does everything you do.

Mr Harnick: But you may not like what the commissioner recommends; the Legislature has to make that final decision. The Legislature or the party that forms the government has the numbers; essentially, it can circumvent everything that the commissioner may recommend.

Hon Mr Evans: Well, they can do that.

Mr Harnick: At their peril, obviously.

Hon Mr Evans: I do not know how long you would have a commissioner if you overruled him too often. I think he would probably pack up and say keep it. But actually, that is your responsibility, that is what you are elected for, and I would not be upset if somebody refused to accept my recommendation. I have very limited things that I can do, anyway, by way of recommendation.

The process is slow to begin with and I think the more of those things that you have, it destroys it. You have a court system in the United States where you can make an appeal in one area in the state court and if you do not like that you go to a federal court. So, 15 years later they are still debating whether a man should be hanged or imprisoned or what should be done because of the process. Court process is slow, we know that, but it is going to speed up a bit now.

But, if I can get a plug in for the courts, legislators must become aware of the problem and do something about it. For years, when I was Chief Justice, we gave our annual statement. I concluded that while justice had a high profile, it had a low priority with the Treasury Board and now we are suffering from that.

Mr Poirier: That is a good plug for the courts.

Ms S. Murdock: He did that so well.

Hon Mr Evans: I did the job and nobody paid any attention. Not even when we got $25 million off Amway and I thought that was going to go into the court process. I was very disappointed when that disappeared into the general coffers. That was a real grab, you know that? No work on the part of the province, it was mostly federal. It happened here. I am sorry; I got distracted.

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Mr Carr: First of all, I would agree with you about the court backlog. Unfortunately, now that people convicted of drunk driving charges are getting sprung all of a sudden it is important, and it is unfortunate that we did not listen to your advice.

But going on -- I will talk about the new guidelines -- section 24 deals with another cabinet minister in a constituency office. I was wondering how you would handle a problem like this: If I am the Solicitor General and I have written the Minister of Community and Social Services about a particular problem on behalf of my constituent, as we all do, it would be inappropriate for me at the next cabinet meeting to say: "Charles" -- when he is Minister of Community and Social Services -- "what about that? What is your answer on that?" Is that what that is referring to, or am I wrong in reading that?

Hon Mr Evans: I think ministers should not be interfering with any agency of the government, and I think now that parliamentary assistants might well be in that same category. But that does not stop your constituency office from representing the constituents, and I think once you become a minister you have to have a level in there of non-intervention.

Mr Carr: So this would be for workers' compensation situations --

Hon Mr Evans: Workers' Compensation Board and things like that. I do not think it is right for a parliamentary assistant to come before the Liquor Control Board of Ontario because invariably he is going to say, "I am the parliamentary assistant to the minister." To say that the minister has a right to appear, I think he is restricted and, I think, properly. I do not think that if his constituency office goes in there they should start waving a flag that they are from the ministry of certain health and welfare --

Mr Carr: But if they cannot, then you do not see, by default, actually your constituent not being represented properly then because of that?

Hon Mr Evans: I thought that was what the constituency office was for. And is there not money paid to somebody in the constituency office, or am I wrong in that?

Interjection.

Hon Mr Evans: Yes, so you have a salaried staff in there that he would represent.

Mr Carr: So that person would do it rather than the minister.

Hon Mr Evans: I thought that was what he would do. I think it makes it very difficult for a board and you have appointed him and he has got three years or maybe three months to go and you are the minister coming in and you can get rejection of your client's application, your friend's application, whatever you want to call him, your constituent's application. I think that would be pretty difficult and embarrassing for that member, for the same reason that you do not have former members of your firm appear before you for a period of time when you are in court.

Ms S. Murdock: I have one question. But continuing in that line, for instance, I, as parliamentary assistant to the Minister of Labour, am in charge of workers' compensation. My constituency assistants then represent workers' compensation claims in my riding. You are not saying that they should not make presentations to the board, just that they should not wave the flag saying, "My boss is" --

Hon Mr Evans: Yes, that is right.

Ms S. Murdock: Okay.

Hon Mr Evans: Yes. You can represent them. I thought that was what the constituency office would do.

Ms S. Murdock: Yes, it would put a real constraint on the staff, depending on the MPP's position, whether or not they could make representations on behalf of the constituents who were having difficulty with a particular ministry.

Hon Mr Evans: I am sure if somebody comes to the parliamentary assistant and has a complaint to make, they want to see you and you then refer them over to your worker in the constituency office.

Ms S. Murdock: The question I wanted to ask is one that was actually raised, inadvertently, I guess, last week and I just would like your opinion on it. Mr Elston was talking about knowing of a case where in order to put the business interests into a trust it cost an enormous amount of money, and of course the MPP got no recompense for that.

Hon Mr Evans: Right.

Ms S. Murdock: I would like to know what your thoughts on that were, whether or not there should be some form whereby ministers and PAs who have to put their assets into a trust should be recompensed.

Hon Mr Evans: I think they should be. In the federal proposed legislation there is a provision in there that they pay for it. You are penalizing him by putting it into a trust and then you turn around and make him pay for it. You can say, "What is an arm's-length transaction?" You cannot have your brother in there, but you might have somebody else come in to work in the business for you. I think if you are going to go that far to divest and really shove it away and get a trust company or a trustee or an accountant or somebody like that who is independent and removed from you to carry out the duties of the trustee, then the government should pay it.

Ms S. Murdock: Okay. I have to apologize because I am a guest here today and I have not read it all, not realizing that I was going to be here I did not, so I am not familiar with the exact clauses. Is there anything within the legislation or in place within the legislation that would allow, or could we just add it, that the government should recompense costs?

Hon Mr Evans: I think we just add it. There is the federal legislation but, as I say, that has never been passed. In my speaking with those in charge of it down in Ottawa, it is never going to pass in the form that they have got.

Ms S. Murdock: And does that legislation recommend --

Hon Mr Evans: Because of the divestment.

Ms S. Murdock: Divestment and payment.

Hon Mr Evans: And payment, yes.

Ms S. Murdock: And it probably will not pass. Is there any reason for that, other than the obvious?

Hon Mr Evans: Apart from the obvious, there is the fact that it has been on the order paper for some time and nothing has been done about it. It has been brought up and it died. So this is about six years since it has been there.

Mr Sorbara: Commissioner, you have interviewed a lot of MPPs. Would you agree with me that they are generally a collection of quite honest men and women?

Hon Mr Evans: I believe that, yes.

Mr Sorbara: Have you ever seen a case in your two and a half years of interviewing where you had grave suspicions about the purpose for which the individual had entered politics, that is, for personal gain?

Hon Mr Evans: No, I have not. I may say, though, probably I am biased because, having been a judge for some time, people say, "Why did you become a judge when you're going to get half the salary you made as a lawyer?" I think maybe you owe something to the country, and I did not think I was alone in owing something to the country. I think being a politician is a lousy job from my observation of it. It is hard work. It is like when you are a lawyer you think the judge has an easy thing; he just sits up there, dispenses it left and right, does not even have to think. When you become a judge you find out that it is a little different; you work hard and politicians work hard.

As I say, with everybody who came through that door I assumed that he was an honest individual who wanted to do the right thing. The only reason I have asked them on one occasion in there, and you will probably see it, I might have the right to do a little spot-checking, not for the purpose of finding because I do not believe him, but because I think some members are a little careless. I just want to bring home to them that the filing of this return is important and we would like it accurate.

What I am talking about is that it probably comes in and you look at it and you say, "This is the same as I had last year," where he just changed a few dollars or something. You get a pretty good picture overall of his worth and so forth. It just cannot be. So I would likely ask him, "Please bring me your last statement from the bank" -- not a whole lot of work or anything like that; just to bring it in -- to impress upon him, not that I do not trust him but that I think he is just careless.

Mr Sorbara: So it is like supporting documentation.

Hon Mr Evans: That is right. That is all I want. I do not want the right to go down and pry into his business affairs.

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Mr Sorbara: What about the other "private" interests that politicians have, the private political interests? My own impression is that most of us, once we are confirmed in our commitment to this crazy life, set aside monetary interests in favour of that other interest; that is, political support. It seems to me that sometimes we will do far too much to ensure that we have enough monetary support from a business or an agency of government, but what about political support from the various constituencies to which we direct our political attention, whether that be our electoral district, or if I am the Minister of Consumer and Commercial Relations, the constituencies that I deal with in that ministry, or if I am a parliamentary assistant of Labour, perhaps various elements of the trade union movement? Is that not a private interest as well that we should be concerned with? Have you got any thoughts on that?

Hon Mr Evans: I do not think you can divorce yourself completely from your background, for instance if you are interested in commercial activities. I do not think you can quite divorce yourself from it, but I believe all of them do their best to set that aside. I did say to Premier Peterson at that time when I saw this for the first time, "You don't pay them enough." I really thought some of them were flirting with bankruptcy, and quite honestly I thought some must be having a pretty difficult time with families to make ends meet, and the contribution they are making I wonder whether it is worth while.

Mr Sorbara: But on the political spectrum if, for example, I as one of the incumbent ministers did emerge out of a job in which she was a chief negotiator for the public sector trade union, the Ontario Public Service Employees Union, and then becomes the Chairman of Management Board, she quickly switches roles and may well have some moral or political debts to pay. Is that a conflict of interest in your view?

Hon Mr Evans: No, I do not think so, unless something is done, and we are talking then about perception. I think you would have to wait and see that something has happened. It is just the same as somebody who has been a General Motors executive or something and is retired and comes here or a school teacher who is retired; I think they would leave that aside. Probably they are the best people. They know how the other side operates, and the fact that they have been in that position for some time and then moved over, I do not think makes a --

Mr Sorbara: And in fact there would be no way to divest yourself of that former responsibility.

Hon Mr Evans: Short of a lobotomy.

Mr Sorbara: Short of a lobotomy. In your view, and I want to tell you that I agree with you, there is absolutely nothing inappropriate for someone, having been elected and been chosen to play that role, to emerge out of something that would be a conflict if you are trying to do both of them at the same time but no longer is a conflict because it is disclosed that you had that former role. People can evaluate your performance as the Chairman of Management Board based on that information.

Hon Mr Evans: Right.

Mr Sorbara: So it is disclosure to the public that really is the sine qua non of dealing with conflicts.

Hon Mr Evans: Correct.

Mr Sorbara: We had discussions here about a person being arrested and convicted. As long as that is part of public information, the public can make a determination.

Hon Mr Evans: Right.

Mr Sorbara: I do not know who else has questions. I would like to get your commentary on the bill. What I would like to do is just invite you to highlight for the committee the changes that you think should be incorporated into a bill amending Bill 1.

Hon Mr Evans: Some of them are kind of housekeeping.

Mr Sorbara: Yes. And I invite you to go wherever you want. Obviously we do not need to go over every section in detail, but I would like you to highlight the major thrust of the comments and the major thrust of the amendments that you are recommending.

Hon Mr Evans: In section 1 I wanted a private interest to be defined differently. The private interest is one of these negative ones; it does not include an interest in a decision. I thought it should be: "'private interest' is a benefit which accrues to the advantage of a member or a person or corporation to which the member knowingly seeks to give an advantage over other members of the public but does not include an interest in a decision" -- and you put (a), (b) and (c) after that. I thought that was better than the way in which it is drawn.

I was looking, too, for a little assistance on section 7, because the act purports to deal with members of the Legislative Assembly, and that particular section includes "an employee of a ministry." I do not think that should be in there because I do not think I have anything to do with it.

Mr Sorbara: That brings in a whole new category of people.

Hon Mr Evans: Yes, someplace else.

Mr Sorbara: The Public Service Act or something like that.

Hon Mr Evans: One of the other ones was section 10.

Mr Sorbara: Could I just stop you for a moment before we get to section 10? Section 8 is, I think, probably you will agree, the major prohibition in the act. The prohibition against a cabinet minister engaging in business in any respect seems to me to be the one that gives rise to the obligation upon a minister to arrange his or her affairs in the way that has him not in violation of this section. Now, in your experience, has that been a difficult section for some ministers to comply with?

Hon Mr Evans: No. I thought the (b) section of 8 should be "actively carry on a business." Then we have stopped lawyers from advertising and so forth, but if a lawyer or a doctor has bills coming in after he assumes the position of the minister, surely he is entitled to fees on that basis and sharing of profits, but I do not think that he should be actively carrying on a business any more than the practice of a profession or anything else.

We have no provision in the act as to what happens -- in other words, there is no penal section in there -- if he does not do it.

Mr Sorbara: That is, if a minister is carrying on a business or engages in a profession.

Hon Mr Evans: If he does not comply with it.

Mr Sorbara: But presumably if, as a result of the annual disclosure made, it becomes apparent to you that the individual is carrying on a business, that is something you would report to the Legislature.

Hon Mr Evans: But that may be quite a way down the road.

Mr Sorbara: Sure.

Hon Mr Evans: At the present time it is 61 days or something.

Mr Sorbara: Okay. I am sorry; I interrupted you. Were you going to section 10?

Hon Mr Evans: I went to 10 because I wanted the files to be exempt from disclosure under the Freedom of Information and Protection of Privacy Act. I think they are, but I would be happier if it was spelled out in the legislation because I do not want to get into a hassle with the privacy commissioner; but unless they are private the whole purpose of this is destroyed.

Mr Sorbara: Because you filter the information.

Hon Mr Evans: Yes. Right.

Mr Sorbara: So you are in fact a privacy commissioner in the sense that you receive information privately disclosed and determine what shall be publicly disclosed.

Hon Mr Evans: Right.

Mr Sorbara: I think that is extremely good, but have you had requests under the freedom of information act to disclose the raw material of a member's file?

Hon Mr Evans: No. Also, I think there should be a provision for an interim commissioner in the event that something happens -- incapacity or something like that. Today I feel pretty good, but that means nothing. I think there should be some provision for that. Also, someplace there might be a general clause giving some discretion to the minister.

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We have had people in from other provinces, and in two or three of the situations that arose I was asked what I would do and I told them what I would do. It was not in conformity with the act, but you have a situation with that long bundle of paper. I inherited this act. I did not draft it, and I did not draft the paper that goes with it. We have cut it down this last year and we would like to do more, but there are things that come in to me, such as support.

One member -- not one member from here but these are two instances from other jurisdictions -- said he had been married and divorced and he remarried, but he did not tell his second wife there was a child from the first marriage who was being supported by him. I asked myself: "Whose business is that and where is the conflict? What business is it of the public or his seatmate or anybody else?" That was one where, when they asked me what I would do, I said I would not disclose it. There was no point in destroying his marriage; he was probably having trouble enough.

Mr Sorbara: If he is a politician, that is true.

Hon Mr Evans: The other one was interfamily. This was a situation where the man had a family of two daughters. One became a radiologist and married a doctor, no children, and was doing very well. The other daughter married a mechanic, had two children, lived close to the grandparents and needed some money, so they prepared to give them a mortgage and to forgive part of it. He wanted that to show in the event of his death and his wife was living. He was afraid that this was going to create problems. The other daughter, while she was doing well and so forth, would wonder, "Why would Father give this one money and not me?" Or a member who borrows from his parents to buy a house in Toronto or elsewhere: What business is that of anybody's?

I have consistently, in my own situation here, not shown those things because, again, that is not my view of what this whole legislation is about as a conflict. When redrafting is done, I would like to be able to knock out some of those clauses that refer to these items. I am only making a recommendation -- you will decide it -- but I am telling you what my view is of it. Everyone who has come in I have asked them about these things.

The same thing too, I think it might be cleared up that we do not disclose the value. We show bank accounts, certain banks, but we do not show the amount. Some policy people are telling me that I was not doing this correctly. I asked everybody who came in and there were only two who said, "Oh no, I think we should make full disclosure of whatever I have in the bank." One fellow came in and he said, "I have $147.13 in my pocket, cash." I said, "Did you count that?" He said, "Yes, today. Wasn't I supposed to?"

Mr Sorbara: Was that his net worth?

Hon Mr Evans: No, he was better off than that. But actually I think it is spelled out. I asked everybody who came in, "Did you feel when this legislation was passed that you may be compelled to divulge the amount of money you have and the value of all your assets in a public declaration?" They said, "God, no, I never thought that."

I think, too, that we should make it clear in the legislation that "private" is one thing and "public" is another. That is not quite clear, in my view, throughout the act. "Private" is what you tell me, "public" is what I tell the public you have, but we do not put any of that in. Otherwise they are going to lie. Human nature being what it is, I think we would have problems.

Mr Sorbara: If you have done your review of the act, I think these are going to be very helpful for the committee members in making recommendations to the government on a redrafted act.

My final question has to do with the real nature of divestiture and what that means. You have seen a lot of disclosure statements and you have seen some fairly complicated ones if you have looked at -- let us call it what it is -- my disclosure statement or Joan Smith's or some other member's. These are pretty complicated financial documents.

Hon Mr Evans: Right.

Mr Sorbara: So let me put this hypothetical to you: If I own a piece of land that is worth $1 million and the law requires me to divest myself of that land, let us assume that I am extremely anxious to be in cabinet and I have to sell it but I sell it for $800,000. I have now taken a $200,000 loss, but in the 60 or 90 or 120 days or whatever the Premier has given me or the law gives me, I can only find an arm's-length purchaser who was willing to give me $200,000 in cash and has required that I take back a mortgage of $600,000. Is it not the case that I have, under the law, as significant an interest in that piece of land as I did before I sold it?

Hon Mr Evans: Right.

Mr Sorbara: Because I hold a mortgage on it and the quality of my interest really has only changed from fee simple to that of a mortgage holder. That divestiture, if it is going to really mean anything, not only means sale but sale in cash so that there is not any residual interest in the assets being divested.

Hon Mr Evans: There is no doubt that this is very difficult -- same thing with family corporations.

Years ago when I was practising law you set up an estate family trust to avoid duplication of succession duties. We are out of succession duties for the time being, but it does not seem realistic, if you have a family corporation and yourself, your wife and two children each holding a quarter share, to say that you are going to force the member to give up his one fourth share over to somebody else who is far removed from the other three. That is just a figment of the imagination, because the other three are certainly going to talk with the father about this matter.

From a practical aspect it is unwise, because then you are bringing into that family someone with a one fourth interest as trustee. Maybe he knows very little about it and he is going to depend on the other three in any event, or else he is going to cause problems for the other three. Something, I suggest, should be done about that when the business is not likely to become involved with government. There are lots of businesses that do not deal with government -- with a shoe store you are not selling many shoes to the government. These are things that I think one might take an interest in and probably correct.

Complete divestiture is an alternative to some form of trusteeship, but I certainly think it is going to eliminate a lot of people from cabinet positions. I think, too, to require the transfer of a business to a trustee and anticipate that there will be no consultation between the trustee and the settler, you are just expecting those parties to be walking around with the angels. I question whether it is necessary or whether the public actually requires such a trusteeship or accepts it. Proper disclosure and a rigid enforcement of section 9 of the act, I think, should be generally adequate; that is, if you are involved in something you do not vote on it and you get out.

We have done pretty well with people to whom -- well, it is not in the act -- we have said, "Look, if you have any substantial change in your assets, liabilities and so forth, please let us know," and they do. In that way we could not wait until the next year to find out whether people were having some difficulties. I think that now that they are getting accustomed to the act they come in and ask more questions.

Mr Sorbara: In summary then, a system of ongoing disclosure, in your view, would be the best way to protect against the members knowingly placing themselves in a conflict.

Hon Mr Evans: Right.

Mr Sorbara: That is, all the world will know if I do this, so I ought not.

Hon Mr Evans: You pay the price.

Mr Sorbara: Yes.

The Acting Chair: Thank you, Mr Evans, for appearing here today. Your information was well rounded and accepted.

Before everyone leaves, the clerk does have something that she would like to mention to us.

Clerk of the Committee: I just want to bring everybody's attention to the agenda for this week.

The only change in the agenda is, I am still trying to book two more academics but they will be booked Thursday morning. It does not affect the agenda. Therefore, we are not meeting tomorrow; we are meeting Wednesday morning and all day Thursday.

For next week, the Progressive Conservatives have exercised their option to reschedule their 123 matter to 27 and 28 February. So we are doing clause-by-clause on the 25th and 26th and standing order 123 on the 27th and 28th, which will flow over to the first week back.

The only other thing to mention is that this committee does have to write a report, review and make recommendations with respect to the guidelines governing conflict of interest. The suggestion would be that the researcher summarize everything that happens this week, send it out over the next two weeks to members and we consider instructions to the researcher on the report on 18 March when the House reconvenes.

Mr Sorbara: Just on that, are we subject to a time limit as far as conflict-of-interest guidelines are concerned?

Clerk of the Committee: No. There were no specific instructions from the House with respect to a time limit.

Mr Sorbara: Okay.

The Acting Chair: Anything else? Thank you. The meeting is adjourned until Wednesday 20 February at 10 am.

The committee adjourned at 1601.