Morneau to set up blind trust, divest shares in firm
FINANCE MINISTER BLINKS FOLLOWING DAYS OF STEADY PRESSURE OVER HIS FAMILY’S PENSION SERVICES HOLDINGS
Following days of accusations that he was putting himself in a conflict of interest, Finance Minister Bill Morneau has announced he will set up a blind trust and sell off his ownership stake in his family’s pension services company.
He also denies he was ever in a conflict, despite having personally introduced legislation last year that proposes changes to pension regulations.
The finance minister pointed out that a conflict-of-interest screen has been established in his office that requires him to be recused from discussions that directly affect Morneau Shepell, except by way of “general application.”
He could recall at least two times when he had been pulled out of a meeting because of the screen, but could not clarify what exactly those meetings had been about. “I don’t know what the issues were discussed in those meetings, because I was taken out,” he said.
Morneau described the controversy over his finances as a distraction from the work the government is trying to do, and said it was time to go “above and beyond” what Ethics Commissioner Mary Dawson had previously told him was required.
“I, perhaps naively, thought that, you know, in Canada, following the rules and respecting the recommendations of the ethics commissioner, respecting the recommendations of an officer of Parliament, would be what Canadians would expect,” he said.
“In fact, what we’ve seen over the past week is that I need to do more. As minister of finance, in this role, it’s important to make sure people have absolute confidence.”
After his election in 2015, Morneau had given interviews saying he expected his Morneau Shepell holdings would have to go into a blind trust, and it was widely believed he had set that up. Even the company itself was under that impression, giving statements to the media that the shares were held in a blind trust.
But it turned out Dawson told Morneau that Canada’s ethics laws allowed the shares to remain in a holding company, even though the holding company is in turn owned by Morneau.
On Thursday, Morneau distributed a letter dated Feb. 2, 2016, where Dawson’s office gave him recommendations. The letter says the Morneau Shepell holdings are not considered an asset personally held by Morneau, so “a blind trust agreement is therefore not required.”
It says Dawson “is of the opinion that the best measure of compliance would be to establish a conflict of interest screen which would be made public.”
Asked why he’s changing his mind now and moving forward with the blind trust and divestment, Morneau said the continuing focus on his investments made it necessary.
“At a certain stage, we can’t have tin ears. We work for Canadians ... So if we’re getting distracted because some people are worried about my personal situation, it’s time to move on.”
Opposition MPs have been hammering Morneau all week for maintaining active ownership in Morneau Shepell, particularly given the fact he introduced legislation last year — Bill C-27 — that would make changes to pension regulations. The NDP’s Guy Caron called it “the most egregious conflict-of-interest case we’ve ever seen.”
Morneau had been away from the House of Commons recently as he attended out- of- province events to roll out the smallbusiness tax reforms. But he was back in Ottawa on Thursday to defend himself in question period.
“We all thought he had placed his shares in a blind trust,” Conservative MP Candice Bergen said. “He had not done that and in fact he was enacting legislation that would directly benefit him and Morneau Shepell.”
Morneau did not answer questions about whether he had specifically recused himself from Bill C-27 discussions, but he repeatedly insisted the opposition’s attacks were really about the advice Dawson had given
IF WE’RE GETTING DISTRACTED BECAUSE SOME PEOPLE ARE WORRIED ABOUT MY PERSONAL SITUATION, IT’S TIME TO MOVE ON.
him, which he followed.
“If the member opposite is actually suggesting that the ethics commissioner is not doing a good job, he should come out and say that to her,” he said in response to a question from the NDP’s Nathan Cullen.
Speaking to reporters, Morneau also clarified that he still owns about a million shares in the company — half of what was reported in 2015. He later said he had sold some of the shares before taking office.
Morneau said his lawyers will now get to work on setting up the blind trust for all of his assets, and then start the process to divest his Morneau Shepell shares.
“I’ ll do that as expeditiously as possible, and I expect, although I won’t know, since it will be through somebody else, that it will be through the stock market,” he said.