An investigation by the federal ethics watchdog has found that Minister Diane Finley was in breach of conflict of interest rules when she approved $1 million for a Jewish community centre under a fund created to improve access to buildings for the disabled.
Finley greenlit funding for the Markham Centre for Skills and Independence under the Enabling Accessibility Fund in August 2011, when she was the Minister of Human Resources and Skills Development.
She is now the Minister of Public Works.
After an investigation, Ethics Commissioner Mary Dawson found that the project received “preferential treatment.” As such, Finley contravened subsection 6(1) of the Conflict of Interest Act, which “prohibits public office holders, in exercising an official power, duty or function, from making decisions that they know, or reasonably should know, would place them in a conflict of interest.”
Speaking during Tuesday's question period, Finley repeatedly said she "always believed" the project was valid and "in the public interest," but added that she accepts the findings of the ethics commissioner "to ensure that this subsidy program is administered equitably, accessibly, and efficiently for everyone concerned."
After Dawson issued her report on the matter Tuesday, the PMO issued a brief statement saying Finley “acted in good faith.”
“The Prime Minister accepts that the Minister acted within her discretionary authority and in good faith in approving a project to improve the accessibility of a community centre in Markham.”
Prime Minister Stephen Harper reiterated during question period that Finley acted “in good faith” and said that she had “no personal interest whatsoever in this decision.” He also denied any previous knowledge of the project.
MP Charlie Angus, the NDP ethics critic, said during question period that Finley should apologize.
“You expect that when a minister breaks the rules, there’s a ‘sorry,’” he said.
Sources have told CTV News that Finley will not resign from her current cabinet post.
Dawson said she launched her probe of the incident after media reports suggested the Markham proposal may have received special treatment from Finley.
A conflict of interest can occur when a public office holder has an opportunity to further his or her own private interests or those of relatives or friends, or an opportunity to further the private interests of another person.
“I found that the Markham proposal clearly received preferential treatment,” Dawson said, noting that it was the only one allowed to submit additional information after its proposal failed an initial assessment by Finley’s department.
Finley herself added the project to a list of four that had already been selected from more than 160 proposals submitted for funding.
The proposal was also the only one to be granted an evaluation extension at Finley’s request, Dawson said.
The Prime Minister’s Office, staff at Finley's office, two ministers – including then-foreign affairs minister John Baird and then-environment minister Peter Kent -- and senior department officials also engaged in “a number of interventions in relation to the proposal,” Dawson said.
The project was spearheaded by Rabbi Chaim Mendelsohn, on behalf of the Canadian Federation of Chabad Lubavitch. Mendelsohn was reportedly closely linked to Baird, and was among the delegation that travelled with Harper to Israel in 2014.
According to Dawson, Nigel Wright, then the PM’s chief of staff, told her he was approached by Finley outside a cabinet meeting to ask whether Mendelsohn’s proposal was considered important.
“He told her he had been asked by the prime minister to ‘sort it out,’” Dawson said. “According to Mr. Wright, he did not intend to suggest to Ms. Finley that funding should be approved for the Markham project, only that it was important that the matter be considered carefully and fairly.”
Wright also told Dawson that Kent had urged fair consideration for the project.
Kent represents a riding that is approximately one-third Jewish, according to Statistics Canada.
The Chabad Lubavitch federation ultimately couldn’t obtain timely construction permits. After spending $50,000 of the $1 million approved by Finley, the remainder was withdrawn.
Dawson said that Finley told her “several colleagues” brought the Markham project to her attention. She denied or did not remember speaking to Baird, Kent or Wright about the proposal.
When considering adherence to subsection 6(1), Dawson had to determine whether Finley improperly furthered the private interests of any person in exercising her powers as minister, and whether she knew or should have known that she would be in a conflict of interest when making her decision.
Looking at the rules governing Finley as she exercised her duties, including the Treasury Board’s policy on transfer payments and a directive from the prime minister for ministers and ministers of state, Dawson said “it appears that some of these guiding principles were not top of mind in the handling of the Markham proposal.”
As a result -- and particularly because the Markham proposal received preferential treatment -- Finley’s decision to fund the project was “improper” and she should have known she would be in a conflict of interest, Dawson said.
Dawson also examined whether Finley was in violation of section 7 of the Act, which prohibits public office holders “when exercising an official power, duty or function, from giving preferential treatment to a person or organization based on the identity of someone representing that person or organization.”
Dawson concluded that Finley did not contravene section 7, which is “very limited in its application.”
With a report from CTV’s Ottawa Bureau Chief Robert Fife and files from The Canadian Press
