THE ETHICS COMMISSIONER SAYS SHE TOLD THE FINANCE MINISTER HE DID NOT HAVE TO SET UP A BLIND TRUST FOR HIS SHARES IN PENSION GIANT MORNEAU SHEPELL BEFORE JOINING CABINET. NOT GOOD ENOUGH, SAY CRITICS.
Opposition cites possible conflict, seeks probe
OTTAWA • Speaking for the first time on the escalating controversy over Finance Minister Bill Morneau’s personal finances, Ethics Commissioner Mary Dawson clarified on Tuesday she had simply told Morneau it wasn’t a requirement to set up a blind trust, rather than advising him against it.
Her comments come as opposition MPs demand an investigation into whether the finance minister is in a conflict of interest, and push for transparency on the murky question of whether Morneau still owns shares in the pension services company he used to run.
Meanwhile, Morneau has sent a letter to Dawson requesting a meeting to discuss whether further measures are required for his assets.
Speaking to reporters outside a Commons committee meeting, Dawson said she had told Morneau it “wasn’t required” that he set up a blind trust after his election.
“I’m saying that I took a look at what he disclosed, and according to what was disclosed, and which I do for anybody, I make a judgment as to what’s necessary,” she said.
But pushed on how Morneau could be in compliance with a law requiring ministers to either sell controlled assets in an arm’slength transaction or put them in a blind trust, Dawson indicated the shares may be held in a manner where they are not directly controlled by Morneau.
“A controlled asset is something that somebody holds. You hold the asset. Sometimes the asset is not directly held. Our (Conflict of Interest Act) covers things that are directly held,” she said.
She then declined to comment directly about whether Morneau still holds shares in Morneau Shepell.
“If you have ownership or shareholders in a corporation, that doesn’t reach down through the corporation into the other items that the corporation manages. I’ll just leave it at that.”
One of Dawson’s most persistent critics rejected that explanation.
“We know he owned the shares when he became a cabinet minister,” said Duff Conacher, the co-founder of Democracy Watch. “Within 120 days he has to sell them or put them in a blind trust. No exceptions. And any other advice would be illegal.”
Documents show that before his election in 2015, Morneau held 2.07 million common shares in Morneau Shepell, which would be worth around $43 million today. Morneau’s office will not say if he has since sold any shares in the company, or whether the shares may have been transferred to a trust or to his wife, Nancy McCain.
After the election, Dawson did instruct Morneau’s office to set up a conflict-of-interest screen that requires the minister to recuse himself from discussions and decisions that would directly affect Morneau Shepell. However, the screen comes with an exception for policies that would affect the company by way of “general application,” which critics say makes the screen ineffective.
In his letter to Dawson, Morneau requests another meeting to discuss his assets and disclosures, citing the “increased public scrutiny” on her earlier judgment.
“As a result of this meeting, should you determine that additional measures — such as a blind trust — would be an appropriate course of action, I would be pleased and eager to move forward on any revised recommendations you might provide.”
During the day on Tuesday, both opposition parties set their sights squarely on the question of Morneau’s holdings.
The NDP called on Dawson to investigate whether a government bill relating to pensions puts the finance minister in a “worrisome conflict of interest.” They argued that a government bill on pensions — Bill C-27, which was introduced a year ago but hasn’t yet been debated — would provide a boost to Morneau Shepell due to companies switching from defined-benefit pension plans to target-benefit pension plans.
“It is undeniable that if Bill C-27 were to become law, Morneau Shepell would significantly benefit in additional business and revenue,” said Nathan Cullen, the NDP’s ethics critic.
The Conservatives put forward a motion calling on Morneau to table all the documents that he submitted to the ethics commissioner, setting up nearly a full day of debate on the topic.
“He who has the most control over the nation’s finances should have the most transparency over his interests,” Conservative finance critic Pierre Poilievre said.
The NDP’s Cullen added that it shouldn’t be a hard decision for Morneau.
“If he’s acting in a way that doesn’t personally benefit or enrich him and his family, then he should be able to tell us,” Cullen said.
Morneau was not in attendance for the debate, instead holding an event in Montreal to promote the government’s changes to how private corporations will be taxed.
When a reporter asked in French whether the whole controversy over the tax proposal, including the opposition attacks on his finances, has caused him to rethink his involvement in politics, Morneau quickly shot it down: “Absolument pas.”