SIPO and the regulation of lobbying

A new element to ensuring transparency and high standards in public life.

Mr. Justice Daniel O Keeffe, Chairman,

Standards in Public Office Commission

Introduction

I am pleased to have been invited to address this Conference on the Regulation of Lobbying Act and I would like to thank Public Affairs Ireland for the invitation and for organising the Conference.

Although the Regulation of Lobbying Act is not commencing until 1 September 2015 and the first returns will not be due until the 21 January 2016 the Standards Commission is actively engaging with individuals and bodies who may have a requirement to register as a lobbyist.  This conference is timely, therefore, and ties in with our objective of providing information on the Act and its requirements.

I am accompanied today by our new Head of Lobbying Regulation, Ms Sherry Perreault and by Mr Aidan Moore from our Regulation of Lobbying unit.  Ms Perreault will speak to you about the Commission’s preparations as Regulator of Lobbying and how the Act will work in practice.  She will also speak about the experience of Regulation of Lobbying from a Canadian perspective.

I would like to speak to you today about the Standards Commission's role and functions, its experience as a regulator of transparency regimes and how we see the Regulation of lobbying complementing the Standards Commission’s overall remit.  I will also mention recently announced Government initiatives in relation to Ethics and Electoral legislative reform which may have implications for the future role of the Standards Commission.

Background

I would like to begin by giving you some information on

 

i)                  who the Standards Commission is

ii)               how it operates and

iii)            the various supervisory roles assigned to it.

 

The Standards Commission is an independent body established in December 2001 by the Standards in Public Office Act 2001. It has four ex-officio members – the Clerks of both Dáil and Seanad Éireann; the Ombudsman and the Comptroller and Auditor General.  It also has two “appointed” members – former TD, Mr Jim O’Keeffe and myself.  The Act provides that the Chairman shall be a judge, or a former judge, of the Supreme Court or the High Court

The Office of the Ombudsman provides the Secretariat for the Standards Commission and will do so for the new Regulation of Lobbying function. This shared service model has provided many benefits, cost savings and efficiencies for the tax payer.

The Standards Commission replaced its predecessor the Public Offices Commission which itself had come into existence in November 1995 and which initially had responsibility for the Ethics in Public Office Act 1995 only.

The Electoral Act 1997 expanded the role of the Public Office Commission to include responsibilities under that Act, including disclosure of donations and election spending and supervising the Exchequer funding of political parties under the Act.

In 2001, it was given additionalresponsibility for supervising the expenditure of what was then known as the Party Leaders Allowance and is now referred to as the Parliamentary Activities Allowance.

In 2001, the Public Offices Commission was replaced by the Standards Commission.  Functions under Part 15 of the Local Government Act, relating to the Ethical Framework for Local Government were also added to its remit in 2001.

The Department of Public Expenditure and Reform has recently published proposals for a Public Sector Standards Bill.  The Department of the Environment, Community and Local Government has also recently published a consultation paper to commence the pre-legislative process leading to the establishment of an electoral commission. Each of these proposals will have implications for the composition and future functions of the Standards Commission.

I will address each of these proposals during the course of my speech.

Existing Functions of the Standards Commission

I would now like to speak about the existing functions of the Standards Commission and how the Regulation of Lobbying Act complements these functions.  The functions of the Standards Commission can be broken down into three main areas:

  • Ethics
  • Political financing and expenditure
  • Regulation of Lobbying

 

All are important tools in a suite of transparency initiatives.  I will talk more about each in turn.  

The Ethics in Public Office Act 1995 and the Standards in Public Office Act 2001 (the Ethics Acts 

First I will discuss the Commission’s current role in relation to Ethics legislation.

One of the purposes of the Ethics Acts is to provide for disclosure of interests, including any material factors which could influence a Government Minister or Minister of State, a member of the Houses of the Oireachtas, a member of a State board or a public servant in performing their official duties. Under the Ethics Acts, as well as disclosing interests, evidence of tax compliance must be furnished to the Standards Commission by all members of both Houses of the Oireachtas, the Attorney General and appointees to senior office in public bodies.

The principal tasks of the Standards Commission under this legislation are to provide advice and guidelines on compliance with the Ethics Acts, to administer the disclosure of interests declarations and tax clearance regimes and to investigate and report on complaints and possible contraventions of the Ethics Acts.

The Standards Commission also plays a crucial role under Part 15 of the Local Government Act 2001. It must be consulted in the development or amendment of codes of conduct for both local authority members and employees. In addition, complaints may be made to the Standards Commission under Part 15 about local authority members and employees.

The Standards Commission has extensive investigative powers under the Ethics Acts.  The Commission can appoint an Inquiry Officer to assist it in considering whether an investigation is warranted on foot of a complaint made to it. The Inquiry Officer can seek statements from the person alleged to have contravened the ethics or electoral legislation and from other relevant persons and can seek the production of documents considered relevant to the inquiry.  It is worth noting that the Standards Commission will have similar investigative powers under Section 19 of the Regulation of Lobbying Act.

To date the Standards Commission has completed six investigations under the Ethics Acts.

New proposals for a Public Sector Standards Bil 

The recently published General Scheme of a Public Sector Standards Bill contains proposals for reform, consolidation and modernisation of the current Ethics framework. Key elements of the reforms include: 

  • Replacing the Standards Commission with a Public Sector Standards Commissioner who will have increased powers and, through the establishment of a Deputy Commissioner, will implement more streamlined and improved complaints and investigations procedures. The Commissioner will have stronger powers of sanction and enforcement in relation to a range of contraventions as well as a broader role in the provision of advice and guidance;  It is proposed for example that the Commissioner will be able to issue a fixed payment notice or decide to prosecute summarily a matter that may constitute an offence or alternatively to refer an offence under this Act, or under another Act, to the Director of Public Prosecutions.  
  • Establishing in legislation a set of integrity-driven principles that will apply to all public officials;
  • Strengthening the legal obligation for public officials to disclose as a matter of routine actual and potential conflicts of interest that arise in the context of the performance of their duties;
  • Declarable interests will include political donations and there will be greater consistency and certainty on the rules governing limits on the receipt of gifts and travel benefits by public officials (for example any travel, accommodation, refreshment and ancillary facilities which exceeds €600 will have to be declared).
  • The declarations of interests of politicians and senior officials will be made to the Commissioner and published;

 

  • The imposition of statutory prohibitions on the use of insider information, on the seeking or acceptance by public officials of benefits (including gifts and favours etc.) to further their private interests, and on local elected representatives from dealing professionally with land in certain circumstances. It is proposed that in certain circumstances a member of a local authority will be prohibited from dealing professionally with land both during his or her term of office and for a period of two years thereafter.
  • Establishing a new statutory board to address potential conflicts of interest as public officials take-up roles in the private sector by merging the separate Outside Appointments Board (OAB) for the Civil Service and Local Authority system.

State Funding of Political parties

The Commission is also responsible for oversight of the state funding of political parties under the Electoral Acts and under the Oireachtas (Ministerial and Parliamentary Offices) (Amendment) Act 2014, (the Parliamentary Activities Allowance Act).

The Parliamentary Activities Allowance Act provides for the payment of an annual allowance to the leaders of parliamentary parties and independent members of the Dáil and the Seanad in relation to expenses arising from their parliamentary activities. Almost €8m (€7.93m) was paid to the leaders of parliamentary parties and independent members of the Dáil and the Seanad during 2014.

Funding is also provided to “qualified” political parties under the Electoral Acts.  The four qualified political parties (Fianna Fáil, Fine Gael, Sinn Féin and the Labour Party) received funding of €5.5 million under the Electoral Acts in respect of 2014.

Separate audited annual statements of expenditure of funding received under both pieces of legislation are furnished to the Standards Commission and are published by the Commission.

Functions of the Standards Commission  under the Electoral Acts

The Electoral Acts require the Standards Commission to monitor and, where it considers it appropriate to do so, report on a number of matters including:

  • the acceptance and disclosure of donations;
  • the limitation, disclosure and reimbursement of election expenses;
  • the maintenance of the Register of Corporate Donors; and
  • the registration of "third parties"
  • the preparation of political parties annual accounts.

The introduction of the Electoral Acts in 1997 represented a significant cultural change for those who were engaged in financing of political campaigns.  It is worth noting that from a position prior to the 1997 Electoral Act where private financing of political parties and individual politicians was neither restricted nor disclosed we are now in a position where there are significant restrictions on the types and amounts of donations which may be accepted and disclosure of all donations above what are quite modest thresholds.  For example:

  • Individual politicians or a political party may not accept an anonymous donation exceeding €100 in value or a cash donation exceeding €200 in value.
  • Similarly a donation exceeding €200 in value may not be accepted from a corporate donor unless the corporate donor is registered in the Register of Corporate Donors.
  • An individual politician or a political party may not accept foreign donations.
  • The maximum value of donation(s) which an individual politician may accept from the same donor in the same calendar year is €1,000 while the corresponding amount for a political party is €2,500.
  • Donations exceeding €600 in value must be disclosed by individual politicians and political parties must disclose donations exceeding €1,500.
  • Both individual politicians and political parties must maintain dedicated political donations accounts.
  • From 2015 onwards each political party will have to prepare and submit to the Commission for publication an audited set of annual accounts.

Those covered by the legislation have adapted to the changes brought about by the Electoral Acts.  In many respects the Regulation of Lobbying Act mirrors the Electoral Acts in that it provides for the disclosure of activities which were hitherto not in the public domain.  The Regulation of Lobbying Act will also present a significant cultural change both for people carrying out lobbying activities and for those Designated Public Officials who are being lobbied.

Proposals for the establishment of an Electoral Commission

The programme for Government contains a commitment to establish an Electoral Commission which will subsume the functions of existing bodies, including the Standards Commission, which have a function in relation to the electoral process.  The Department of the Environment has recently published a consultation paper on the matter and the Commission has provided its views.

The Regulation of Lobbying Act 2015

As with theEthics and Electoral Acts, the purpose of the Regulation of Lobbying Act is to bring about greater openness, transparency and accountability.  The legislation provides that the Standards Commission will establish and oversee an online Register of Lobbying. The Standards Commission will also monitor compliance with the legislation, provide guidance and assistance and where necessary investigate and pursue breaches of legal requirements. In due course the Standards Commission will also prepare a Code of Conduct for Lobbying. Finally, it will provide suggestions to theMinister for Public Expenditure and Reform regardingproposed amendments to the legislation which will be based on the Commission’s experience of administering the legislation.

The Standards Commission is pleased to accept the regulatory role provided for it under the Regulation of Lobbying Act. It is of the view that the functions of the Standards Commission relating to Ethics legislation, including Codes of Conduct, complement each other as a discrete but coherentgroup of functions.

As with the Electoral Acts, the Regulation of Lobbying Act provides for public inspection of statutory returns.  The Standards Commission is experienced in facilitating the dissemination of such information while at the same time being mindful of the sensitivities surrounding certain information provided to it.  Similar skills will be required in relation to Regulation of Lobbying where certain information provided to it may be subject to exemption or delayed publication from the register.  Examples of communications which may be exempt include:

  • communications requesting factual information or providing factual information in response to a request for the information;
  • communications directly related to trade union negotiations;
  • communications by a designated public official in his or her capacity as a public official.

Delayed publication might arise where a person considers that publication of information could have a serious adverse effect on the financial interests of the State, the national economy, or business interests generally or the business interests of any particular set of people.

The Standards Commission’s approach as a regulator has been to assist compliance through information, guidance and advice.  The Standards Commission will be adopting a similar approach as Regulator of Lobbying.  It will have investigative powers similar to those it uses in supervising the Ethics Acts.  Under the Regulation of Lobbying Act, however, the Standards Commission will, for the first time be a prosecutory body if called upon to exercise its powers under section 20(4) or section 21 of the Act.

As the Regulation of Lobbying function is new to the Commission, it is as yet uncertain what new challenges may arise. The Commission is pleased that the operation of the Act is subject to mandatory regular review.  The first such review will take place one year after the commencement of the Act and thereafter every 3 years.

Within the scope of the statutory framework which it has been given to it by the Oireachtas, the Standards Commission has shown that it operates in an effective and coordinated manner.  It has developed experience and know-how in supervising transparency regimes.  While Regulation of Lobbying will present new challenges the Commission is confident it can discharge its duties in an efficient and effective manner and bring further transparency to Irish public life.

Conclusion:

Together each of the above pieces of legislation represent a period of 20 years of legislative development in the areas of openness and transparency.

What is the underlying principle of each of these pieces of legislation.  I suggest:

1)   They introduce and maintain a common standard in the respective specialised areas of creating a level playing field for persons or entities effected by the legislation e.g. the Regulation of Lobbying Act seeks to put information regarding lobbying activities in the public domain so as to ensure that long term commercial advantages will not accrue to any entity over another.

2)   The particular legislation seeks to implement a set of standards applicable generally to persons carrying out lobbying activities.

3)   The legislation has its own built-in structure to deal with non-compliance whether by way of enquiry with reputational sanctions or non-court penalties.

4)   Transparency underpins the regulated activities.