Our Scandalous Senate. J. Patrick Boyer
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Stewart-Olsen, a resident of New Brunswick, where she and her husband have a home at Cape Spear, would become a senator. Prime Minister Harper now had a tested and trusted confidant in the upper house, an active supporter seasoned in the backrooms of parliamentary politics. She joined Senator Tkachuk on the Internal Economy Committee’s smaller, and even more powerful, steering committee, where delicate decisions needed to be taken on how to handle the problematic expenses of Stephen Harper’s celebrity senators.
In 2010, veteran journalist Peter Worthington made one of his formidable forays into the operations of Canadian public affairs by recommending, in the Toronto Sun’s December 22 edition, that the Senate of Canada needed “a watchdog.” It was his way of saying the Internal Economy Committee was coming up short, that independent eyes were needed to ensure senators complied with rules and did not waste public money.
Although Worthington’s slant on issues was often at odds with the conventional wisdom prevailing in Canadian political circles, on this issue he was the exponent of a fairly widely held view. Anyone who paid attention knew the Senate did not meet present-day standards in any department. The puzzle was that anybody would even waste their time or talent bothering to mention it. Especially for so skilled a marksman as Peter Worthington, the hoary Senate seemed too easy a target.
But in the eyes of the Internal Economy Committee’s chair David Tkachuk, Worthington’s in-bound missile required some counter-fire. “One matter that has drawn media attention, and which unfortunately has been misinterpreted, concerns the manner in which our expenses are approved,” the senator responded.
“Senators,” Tkachuk explained, “are responsible and accountable for their expenses.” He was referring, of course, to the long-established “honour system” whereby members of the upper house submit chits, or stubs, or receipts, or scrawled notes, or nothing at all, then declare that the spending was for “Senate business” on a covering sheet and sign it. Tkachuk claimed that this system of individual accountability and responsibility was backed up by a strong administrative regime. “The Senate also has rules and limits to govern what is paid, and a vigorous process that ensures only legitimate and reasonable expenses are paid.”
That process involved expense claims being reviewed by the Senate’s Finance Directorate of accountants and bookkeepers. These employees, Tkachuk explained, “ensure that each expense passes the test of the Senate administration’s rules before payment is made,” adding that each claim was “reviewed line-by-line by two separate financial officers.” If they found “anything questionable,” Tkachuk as chair of the Internal Economy Committee would submit it to a committee of three other senators for review, “before payment was made.”
The system was so rigorous, apparently, that if this committee of three senators was not satisfied, chairman Tkachuk would take the questionable expense before a committee of fifteen other senators to defend the expense. He added that senators sometimes even referred an expense issue to outside auditors for independent review. The powerful senator than confidently concluded that the Senate’s own internal process of “a second set of eyes examining our expenses” was “more stringent and onerous” than any “second-level sign off involving auditors” would be.
While Senator Tkachuk dished out such public reassurances, behind the scenes this “stringent and onerous” verification process continued to examine the submitted expense claims of senators Duffy, Wallin, Harb, Brazeau and several others who would later come under scrutiny for seeking improper reimbursements or submitting claims unsupported by proper documentation. But at the time, following “line-by-line review by two separate financial officers,” the Senate approved and paid them all. This had actually been going on for years.
In his response to Peter Worthington, the chair of the Internal Economy Committee further noted how “the auditors found no evidence of wrongdoing. Most of the problems concerned paperwork and documentation, and we are attending to these problems.” He concluded with a final gratuitous salvo, “Senators are dedicated to moving forward in making the institution more accountable to the Canadians they serve, and will continue to strive to manage public funds conscientiously and carefully as we carry out our duties as parliamentarians.”
It was after two more years of this conscientious and careful management that the auditor general of Canada released a report on his audit of Senate administration, stating the upper house had “a reasonable financial management framework in place.” Because “reasonable” was obviously less than “first-rate,” the auditor general recommended that “Senate Administration should ensure it has sufficient documentation to clearly demonstrate that expenses are appropriate” and “should bring to the attention of the Internal Economy Committee any cases in which the Administration believes that required documentation is not sufficient to clearly demonstrate that expenses are appropriate.”
In response to that revealing recommendation, the Senate, still cocooned in its traditional culture of budget management, defensively asserted that it had “clearly defined rules for processing expense claims that are rigorously enforced. As in the private sector, the senator signs his or her expense claim form and attaches the receipts, according to strict rules and guidelines.”
In broader terms, through various public statements between 2010 and 2012, Senator Tkachuk further asserted that for senators’ expenses, “rules and limits govern what is paid,” a “vigorous process ensures only legitimate and reasonable expenses are paid,” and that “strict rules and guidelines” were in place and operating.
By this time, another twenty-four months of expense claims by senators who would subsequently be driven from office on the grounds they’d made false or inappropriate claims had been submitted, reviewed, approved, and paid. The most rigorous part of the Senate’s administrative process appeared to be its ability to cut cheques.
Almost any organization with sizeable amounts of money on tap will spring leaks. Employees may make mistakes on the paperwork, greed could entice one or two to float claims that will enrich them, and every now and then a fraudster might test how successfully he can scam the operation.
If the funds are not earned by an organization’s own hard efforts, but simply turned over from taxpayer revenues each year — for instance to a government department, Crown corporation, or body like the Senate of Canada — a further insidious element may also creep in. Many in government today view public money almost as being what economists call a “free good.” The numbers are abstract. Figures appear on a screen rather than printed on physical currency that is seen and touched and is able to impart a tangible sense of value.
A reckless attitude about dollars emerged during the 1970s that would be abhorrent to an earlier era, when Prime Minister King’s finance minister James Ilsley treated money raised through taxes as a “trust fund” he and others in government operated, with a fiduciary duty, on behalf of the Canadian people. Such frugality gave way to an “Easy come, easy go!” outlook, a transition over several decades that included structural removal of safeguards. Financial controls were loosened, budgets swelled, national debt soared. I explore the causes for this in book-length detail in “Just Trust Us”: The Erosion of Accountability in Canada and also Hands-On Democracy: How You Can Take Part in Canada’s Renewal.
Throughout it all the Senate carried on with its antiquated honour system and loose financial administration, and so, as if in some perverse nightmare, the rest of public sector spending seemed to be finally catching up with senatorial standards of practice.
There have been, fortunately, several countervailing forces.
Partisans, auditors, and reporters were poised to curb those ripping off Senate money or just mindlessly splashing it away. Examining how the expenses of senators were being handled in practice, each would ensure, in their different ways, that the latent potential of the Senate expenses scandal would become real.
The “partisans” in the Senate are the Liberals and Conservatives who, from the upper house’s inception in the 1800s, have populated the place and run it.
Although they sometimes glow about the collegial bond they share and the reputed bi-partisan nature of their committee work, the truth is a large majority of senators arrive on the