John Geddes

Unprecedented indictment, plus a revolutionary fix

Ottawa bureau chief John Geddes on Michael Ferguson’s two-year investigation of the Senate

(Adrian Wyld, The Canadian Press)

(Adrian Wyld, The Canadian Press)

The report of Auditor General Michael Ferguson into the expense claims of senators, finally released this afternoon, managed to pack a punch, even after successive days in which many of its key findings were leaked.

Ferguson’s most sweeping conclusion was a foregone one. “The weaknesses and problems uncovered in the course of this comprehensive audit of senators’ expenses call for a transformational change in the way expenses are claimed, managed, controlled and reviewed,” the audit says.

Still, the combination of an authoritative overview of how the Senate functions and fine-grained detail about the way individual senators behaved makes for an unprecedented indictment of the upper chamber’s handling of public money. Beyond cataloguing problematic practices, Ferguson proposes a solution.

“The oversight of senators’ expenses should be performed by a body . . . the majority of whose membership, including its chair, is independent of the Senate,” he recommends. Not only that: “The meetings of the oversight body should be open to the public, and all its reports, minutes, decisions and reasons should be published on the Senate’s website.”

That sort of transparency would be nothing short of revolutionary. In fact, it would be no less transformative if it were applied as well to the House, where the spending of MPs is also shrouded in secrecy. “In . . . our recommendations, there are things that the House of Commons should pay attention to,” Fergsuon said at a news conference. “I think there’s a lot here that they can learn from, and should learn from.”

But MPs haven’t called him in. Senators did. How did they ever come to open themselves up to this sort of scrutiny? The back story involves the rash of senators’ expense scandals—most prominently, the woes of Sen. Mike Duffy—that came to light in 2013. Under intense pressure, the Senate invited the AG to conduct a full audit. He looked at all expenses incurred by 116 senators and former senators from April 1, 2011, to March 31, 2013. His team examined more than 80,000 expense items. The claims of 30 senators, sitting and retired, were found wanting—nine seriously enough to have their files referred to the RCMP.

“The fundamental principle that guided our work was that public funds should not be used to pay for personal or private activities,” the report says. That seems straightforward enough. Yet, in the eyes of many of the senators found to have made dubious claims, it’s not so clear. Perhaps the main point of dispute is determining a senator’s “primary residence”—a major issue in Duffy’s case, which is now being argued in an Ottawa courtroom.

Senators can claim special living expenses, if their primary residence is 100 km or more from Ottawa. But how is “primary” defined? The AG accepted a common-sense standard, set by a Senate committee in 2013, that “if a senator resides primarily in the [National Capital Region], he or she should not be claiming living expenses for the NCR.”

Related: Is this the end of the Senate as we know it?

Take the case of Sen. Rod Zimmer, a Liberal from Manitoba. The report found he was in Ottawa for 613 days during the audited period, and in Winnipeg, where he claimed his primary residence, for just 118 days. The audit said Zimmer collected $47,132 he shouldn’t have, based on his residency, and another $102,524 for trips between Ottawa and Winnipeg that weren’t for parliamentary business.

In defending himself, Zimmer cited evidence that Mark Audcent, the Senate’s retired law clerk, gave at the Duffy trial. “Mr. Audcent has testified that there is ‘no percentage-of-the-year requirement’ for a senator to be in his home province for the purposes of residency,” Zimmer said in his written response to the audit.

Related: Senators cite #DuffyTrial

He went on to declare, “Winnipeg was always my home.” As well, Zimmer argued that the AG has no business trying to reach conclusions about Senate expenses, including residency rules, before the judge in the Duffy trial issues his ruling. “Will this be seen as prejudging the conclusion Justice Charles Vaillancourt will reach on the same matter, and what if Justice Vaillancourt does not agree with the auditor general’s interpretation?” Zimmer said.

Ferguson’s report documents a number of other cases where his audit found senators were not living mainly where they claimed to have their primary residences. Another recurring issue is the mixing of personal and parliamentary business when senators travel.

For instance, Sen. Gerry St. Germain, who was a politically influential Conservative senator from 1993 to his retirement in 2012, spent $4,415 on six trips to Edmonton. St. Germain said he was doing Senate business. “However,” noted the AG, “the senator was an active member of the board of directors of a private group of companies based in Edmonton, and he attended board meetings during these trips.” In his response, St. Germain said he had met with First Nations representatives on those trips regarding the development of legislation. The AG also found that St. Germain’s staff attended events at his home, including his 50th wedding anniversary party, and other events that weren’t parliamentary business, expensing $43,727.

The report was clear that senators are allowed to expense travel, not only for Senate business, but also when they are doing work for their political parties. It defined “parliamentary business” as including “all business carried on by a senator for public purposes,” including “official business, representative business, partisan business and related travel, but does not include attending to one’s private concerns.”

Related: Read the AG’s report 

Some leading senators boast of having leaped ahead in recent years in terms of how much information they routinely disclose about their spending. But the auditor general is not impressed. “We found that the information disclosed on the Senate website about senators’ expenses did not provide sufficient detail on the nature and purpose of travel and hospitality expenses,” the report said. “For example, it was not possible to know, from this information, how many trips a senator had taken in any given period, the number of travel points used, or the cost of each trip.”

In some cases, friction between the auditor general and a senator was largely over properly documenting the main purpose of a trip. Looking at the claims of Sen. Colin Kenny—a Liberal who was often in the news when he headed a Senate committee on security and defence—the audit found that at least $35,549 in travel expenses he collected were not properly documented. “Several of these trips,” the audit said, “included single, short meetings pertaining to his parliamentary business, but began with, or were followed by, personal activities.”

But Kenny fired back, in the written response that all senators named in the audit were allowed to include in the report, that he was “confounded by the reasoning” the AG used to disallow trips that combined personal and Senate business. “Invalidating an entire trip on account of one personal appointment seems disproportionately punitive,” Kenny said.

Individual senators now have the option of asking for the auditor general’s findings about them to be reviewed by retired Supreme Court of Canada justice Ian Binnie, who has been appointed by the Senate to settle disputes over the report’s findings. But on the Senate’s response as an institution, public opinion will be the court of final appeal.

Yet Senate Speaker Leo Housakos, recently appointed to the post by Prime Minister Stephen Harper, issued a written reaction that seemed to suggest senators are already on the right track. Far from seeing the audit as an unprecedented call for fundamental change, he called it merely “an additional tool to guide [senators’] ongoing efforts to be more transparent, efficient and accountable, with due regard for Canadians.”

Ferguson wasn’t buying that more incremental change along the lines of modest reforms already undertaken by the Senate will be sufficient. “This is an institution whose members have not been required to be fully transparent about their spending, or accountable to Canadians for that spending,” he said at a news conference, adding pointedly, “Our audit has demonstrated that the status quo, when it comes to senators’ spending and the way those expenses are managed, is simply not acceptable. Just changing existing rules or adding to them is not the answer.”

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