Appearance before the House of Commons Standing Committee on Aboriginal Affairs and Northern Development on Bill C-27, An Act to Enhance the Financial Accountability and Transparency of First Nations

October 31, 2012
Ottawa, Ontario

Opening Statement by Jennifer Stoddart
Privacy Commissioner of Canada

(Check against delivery)

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Introduction

Mister Chair and members of the Committee, Thank you for inviting me here today to speak with you regarding Bill C-27, An Act to Enhance the Financial Accountability and Transparency of First Nations. I am joined here today by Patricia Kosseim, our Senior General Counsel.

As you know, Bill C-27 will require that First Nations chiefs and councillors provide an audited schedule of remuneration every year to the Minister of Aboriginal Affairs and Northern Development. This schedule will outline monies paid by the First Nation, or any entity it controls, to its chief and each of its councillors, acting in either their official or personal capacity.

The Bill would require that First Nations publish this schedule on their web sites, and make copies available to anyone upon request. Additionally, the Minister would be required to publish this schedule on the Department of Aboriginal Affairs and Northern Development’s website. While I understand that there are existing reporting arrangements in place for many First Nations, C-27 would effectively harmonize all reporting to the department and provide a legislative basis for proactively disclosing this information publicly available on the Internet.

The Privacy Act

In terms of our Office’s mandate, it is the Privacy Act, which applies to federal public sector organizations. While the Privacy Act is considered quasi-constitutional, some of its provisions may be superseded by other Acts of Parliament. For instance, as a general rule, personal information under the control of a government institution cannot be disclosed without the consent of the individual to whom it relates. As the law stands today, specific salaries are considered personal information within the meaning of the Privacy Act, and they cannot be publicly disclosed by the Minister of Aboriginal Affairs and Northern Development without consent. However, the Privacy Act does exceptionally allow for disclosure of personal information without consent where authorized to do so by another Act of Parliament. In other words, if this Bill were to pass, the Minister would be allowed to disclose specific salaries for the purposes set out in C-27.

The privacy issue before you is therefore not one of lawfulness, but one of principle: C-27 invokes two equally important democratic principles: accountability and privacy. The question then is, how should these two values interplay to minimize adverse impacts and maximize the democratic capital for Canadians?

Existing salary disclosure regimes

Transparency and accountability are principles that my Office takes very seriously. I have, along with Canada’s other federal, provincial and territorial Access to Information and Privacy Commissioners, signed a joint resolution endorsing and promoting open government as a means to enhance transparency and accountability. These are essential features of good governance and critical elements of an effective and robust democracy.

In considering this Bill, I note that there is a distinct trend in Canada towards publicly disclosing the salaries of elected officials along with other senior officials paid from the public purse. When money comes from taxpayers, the expectation for transparency increases as the level of responsibility or salary associated with a position increases.

At the federal level, the precise salaries of elected officials such as the Prime Minister, Ministers, Members of Parliament and other positions are disclosed every year by the Parliament of Canada on its Indemnities, Salaries and Allowances Internet page. Furthermore, pay ranges for public service positions are also made public.

Similarly, in Quebec, the salaries of elected officials are published by the National Assembly. The specific salaries of Quebec’s public servants, by contrast, are not disclosed to the public although those of high-ranking officials can be made available through access request.

In Ontario, the specific salaries of elected provincial officials are made publically available; while only public servants paid $100,000 or more per year have their name, salary and amount of taxable benefits disclosed in yearly reports.

Other provinces, including British Columbia, Nova Scotia and Manitoba also use salary thresholds as a basis for triggering public disclosure requirements of senior elected officials.

There are no comparable regimes that currently cover all First Nations across Canada. Bill C-27 would put in place a uniform standard for publicly disclosing remuneration of elected officials, among other public reporting requirements, in more than 600 First Nations. Its impact on the privacy of these officials therefore requires careful analysis and consideration.

Privacy Analysis Framework

Along these lines, our Office has a longstanding practice of examining the privacy risks posed by a particular initiative by applying a privacy analysis framework and its elements can be summarized by four key questions:

• One, is the measure demonstrably necessary to meet a specific need?
• Two, is it likely to be effective in meeting that need?
• Three, is the loss of privacy proportional to the need?
• And four, is there a less privacy-invasive way of achieving the same end?

The first question evaluates whether the proposed measure is required to achieve a particular policy objective. In most cases, the answer to this question is positive, and the current case is, at first sight, no exception to the rule: financial transparency of public monies paid to elected officials and senior government officials is an important objective that may very well warrant a legislative measure to ensure more uniform reporting requirements than is currently the case and ultimately enhance public accountability and transparency.

The second question considers whether the proposed measure will be successful in achieving the stated policy goal. There may be instances where the proposed measure may not be particularly effective in achieving the objectives for which it was designed. Given the complexity of the native governance architecture, I would respectfully submit that I may not be the right person to answer this question. In this instance, I would rather defer to the discerning assessment of experts well versed in Aboriginal issues.

The third question – which focuses on proportionality – is critical to assessing the privacy impact of a proposed measure. It essentially functions as a sort of balancing test to help determine whether the potentially harmful effects on privacy of individuals is outweighed by the salutary effects of the proposed measure. At this step, it is important to identify all the potential privacy implications of the proposed measure, the number of affected individuals and the extent of the privacy loss. Then, one can make a more enlightened determination as to whether or not the public policy benefits of the proposed measure – in this case greater, and more uniform, public disclosure requirements of First Nations – outweigh the adverse privacy impacts on individual chiefs and councillors. As Parliamentarians, you may find that proactive disclosure of exact salaries, in addition to all of the other public reporting requirements, exceeds the incremental benefits this may yield in terms of enhanced public accountability and transparency. On the other hand, if disclosing salaries of elected officials is becoming a widely adopted trend in Canada, as appears to be the case, it may well be considered reasonably in line with public expectations and proportionate to disclose the salaries of chiefs and councillors as well.

The fourth final step seeks to determine whether the proposed measure can be substituted by another measure that might have a less adverse effect on privacy. This is a time to consider whether there are different options that could yield similar results but in a less privacy-intrusive way. For instance, disclosing salary ranges or aggregate salary amounts for relevant groups, as opposed to specific salaries of individuals, could prove just as effective in achieving enhanced transparency and accountability without incurring the corresponding loss of individual privacy.

Conclusion

In closing now, Mister Chair and members of the Committee, I would like to thank you again for the opportunity to comment on the importance of privacy considerations in this proposed legislation.

Finding the right balance between achieving stated policy objectives and the protection of privacy can be a complex and difficult undertaking. I hope the analytical framework I have presented proves useful to you and I am happy to answer any questions you may have.

Thank you.