• Legislative Framework
• Government Departments, Organizations, and Agencies
• Policies and Procedures
• Conclusion

Despite the perennial existence of corruption, the Canadian government has developed certain laws, institutions, and policies which taken together can be considered to make up Canada's national integrity system. The following discussion wilI outline the basic elements of this anti-corruption system.

Legislative Framework

Canada currently has several bodies of legislation which address corruption. The most significant is the Criminal Code which prohibits several activities: bribery (s.119,120), frauds on the government and influence peddling (s.121), fraud or a breach of trust in connection with the duties of office (s.122), municipal corruption (s.123), selling or purchasing office (s.124), influencing or negotiating appointments or dealing in offices (s.125), possession of property or proceeds obtained by crime (s.354), fraud (s.380), secret commissions (s.426), and laundering proceeds of crime (s.462.31) [see Appendix A).

Although Canada does not have legislation similar to the US Foreign Corrupt Practices Act enacted in 1977, there are provisions in the Criminal Code which have the potential to address corruption taking place outside of Canada. Any person who, while in Canada, conspires with any one to commit an indictable offence in a place outside Canada that is an offence under the laws of that place shall be deemed to have committed the conspiracy in Canada [s.465(3)]. Further, any person who, while outside Canada, conspires with any one to commit an indictable offence in Canada shall be deemed to have committed the offence of conspiracy in Canada [s.465(4)].

The second major piece of legislation is the Income Tax Act, which has the potential to prohibit the deductibility of illegal payments to both domestic and foreign officials. Originally, it appeared to be the case that the deductibility of bribes was permissible under certain circumstances. This was to change when the Income Tax Act was amended in 1991 to include the following section [s.67.5(l)]:

In computing income, no deduction shall be made in respect of an outlay made or expense incurred for the purpose of doing anything that is an offence under any of sections 119 to 121, 123 to 125, 393 and 426 of the Criminal Code or an offence under sections 465 of that Act as it relates to an offence described in any of those sections.

Unlike the Criminal Code and the Income Tax Act, which potentially address the corruption of foreign officials, other Canadian laws relate directly to the integrity of domestic officials. The Financial Administration Act is designed to protect the integrity of the establishment and maintenance of the accounts of Canada and the control of Crown corporations. According to the Act [s.11(2)(f)], the Treasury Board, as the employer, may establish standards of discipline in the public service such as codes of conduct as part of their terms and conditions of employment. Other provisions create an offence for defrauding Her Majesty (s.80) or bribing anyone in public office (s.81).

The Public Service Employment Act [s.10(1)] is designed to ensure that federal Public Servants are appointed according to merit and not through a system of patronage or influence. In the case of an irregularity or fraudulent practice related to selection, the Public Service Commission may conduct an inquiry.

The Parliament of Canada Act addresses conflict of interest for Senators and Members of Parliament (e.g., s. 16). The Rules of the Senate of Canada and the Standing Orders of the House of Commons also deal with conflict of interest issues (e.g., Standing Order 21).

The Immigration Act prohibits bribery of immigration officers and adjudicators. The Income Tax Act and the Statistics Act both prohibit officials from misusing information collected for personal gain. The Privacy Act, in addition to giving Canadian citizens and anyone present in Canada access to federal information about themselves, specifies how federal organizations are to collect, use, disclose, and retain personal information.

Similar rules of conduct exist for the ten provinces and two territories. For example, members of the Ontario Legislative Assembly must follow the Members' Integrity Act which covers conflict of interest situations. The key provision is section 2:

A member of the Assembly shall not make a decision or participate in making a decision in the execution of his or her office if the member knows or reasonably should know that in the making of the decision there is an opportunity to further the member's private interest or improperly to further another person's private interest.

In the early 1980s the Access to Information Act was passed which created an enforceable right of access to information for Canadians, subject to limited and specific exceptions, and provided for an appeal process for refusal of access independent of government, first, to an Information Commissioner, and then to the Federal Court. The purpose of the Act is set out in section 2(l):

The purpose of this Act is to extend the present laws of Canada to provide a right of access to information in records under the control of a government institution in accordance with the principles that government information should be available to the public, that necessary exceptions to the right of access should be limited and specific and that decisions on the disclosure of government information should be reviewed independently of government.

What Canada does not possess, however, is whistleblowing protection legislation, unlike the United States.

Government Departments, Organizations, and Agencies

The Canadian government has several departments, organizations, and agencies which have responsibilities related to addressing corruption in government:

&#deg; The Office of the Auditor General of Canada (promotes accountability in government)

&#deg; Department of Justice (ensures a just and law-abiding society with an accessible, efficient and fair system of justice)

&#deg; Department of the Solicitor-General (maintains a just, peaceful, and safe society)

&#deg; The Treasury Board (manages government's financial, personnel, and administrative responsibilities; establishes standards of discipline in public service)

&#deg; The Office of the Ethics Counsellor (administers conflict of interest codes and lobbyists code)

&#deg; The Office of the Chief Electoral Officer (impedes political partisanship in federal elections)

&#deg; Elections Canada (responsible for integrity of federal elections and referendums)

&#deg; The Information Commissioner (investigates complaints regarding the Access to Information Act)

&#deg; Provincial Ombudsmen (investigate complaints regarding provincial government conduct)

&#deg; The Canadian Security Intelligence Agency (protects Canada against economic espionage)

&#deg; The Royal Canadian Mounted Police (maintains economic clime section to address white-collar crime)

What Canada does not possess is an independent anti-corruption agency or commission, unlike Hong Kong or Singapore.

Policies and Procedures

To enhance public confidence in the integrity of public service, employees are required to abide by conflict of interest and post employment codes. The "Conflict of Interest and Post-Employment Code for Public Office Holders" applies to all federal office holders who are not public servants such as Ministers, their political staffs, all Deputy Ministers, commissioners, tribunal members, and the heads of Crown corporations. The code deals with conflict of interest issues such as gifts, hospitality, and other benefits, disclosure of assets and liabilities, as well as restrictions on employment upon leaving public office. Public servants are required to follow the "Conflict of Interest and Post-Employment Code for the Public Service," issued by the Treasury Board of Canada, Personnel Policy Branch [See Appendix B for examples of provisions].

A minority of government departments have also established codes of conduct which supplement the conflict of interest and post-employment codes, but which their employees must also abide by. Examples include:

&#deg; Revenue Canada's "Supplementary Guidelines on Conflict of Interest for Employees of Revenue Canada" [see Appendix C];

&#deg; Office of the Auditor General of Canada's "Code of Professional Conduct";

&#deg; Canada Communication Group Employees' "Code of Conduct for Canada Communication Group Employees";

&#deg; Transport Canada's "Conflict of Interest and Post-Employment Code";

&#deg; Citizenship and Immigration Canada's "Code of Conduct";

&#deg; Foreign Affairs and international Trade's "Code of Conduct and Conflict of Interest";

&#deg; National Defence's "Statement of Defence Ethics."

A code of conduct has also been established for lobbyists who deal with federal public office holders. It appears that to date, only one government department, National Defence, has developed an ethics training video to supplement its code of ethics.

In an effort to reinforce the importance of personal integrity, all federal servants are required to take and subscribe to the Oath or Solemn Affirmation of Allegiance upon their appointment, as well as the oath or solemn affirmation of office and secrecy.

The activity of public procurement is particularly open to corruption, and in response the Canadian government has developed certain policies. First, Public Works and Government Services Canada (the government's purchasing agent) is expected to abide by the Treasury Board Policy which states that government contracting will:

Stand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds ... [section 2(a)]

Any complaints regarding the process can be taken to the Canadian international Trade Tribunal for investigation and resolution.

Second, the Canadian International Development Agency (CIDA), which funds Canadian development agencies operating abroad, has incorporated into its contribution agreements several provisions which address corruption such as a conflict of interest provision for former public office holders or public servants deriving a benefit from the agreement, as well as a provision restricting the use of lobbyists. In a recent development, Canada has indicated its intention to draft into CIDA contracts the following anti-corruption clause:

No offer, gift or payment, consideration or benefit of any kind, which constitutes an illegal or corrupt practice, has or will be made to anyone, either directly or indirectly, as an inducement or reward for the aware or execution of this contract. Any such practice will be grounds for terminating this contract or taking any other corrective action as appropriate.

Conclusion

It is clear from the above discussion that Canada has a well established national integrity system. Government legislation, institutions, and policies have been put into effect to address corruption. What is not clear is whether the laws and policies on paper are being monitored and enforced sufficiently, and whether educational measures such as ethics training of government officials could be enhanced.

To date, no comprehensive analysis has been conducted on Canada's national integrity system. This might be considered understandable given Canada's ranking as the fifth least corrupt nation out of fifty-four in which to do business (TI Corruption Perceptions Index, 1996). At the same time, Canada is clearly not devoid of corruption in government and the corporate sector. The following are some examples of media stories over the past few years: golf trips to Florida for military generals; unusual contracting practices at Natural Resources Canada; misuse of expense accounts by Saskatchewan government officials; the export of military equipment to China; and unacceptable behaviour and a possible coverup of Canadian servicemen activities in Somalia. The "Report of the Auditor General of Canada to the House of Commons: Ethics and Fraud Awareness in Government" (May, 1995, Vol. 1, chapter 1), although finding a "...strong base of ethical standards among public servants" (p. 1-5), also found some areas of vulnerability.

In the corporate sector, a survey by KPMG (1997) found that sixty-two percent of respondents from Canada's 1,000 largest corporations reported that fraud had taken place in their organization in the past year. The cover article in Canada's national magazine discusses Canada as a new haven for international fraudsters due to the current lack of enforcement (Macleans, July, 1997).