Transcript: May 8, 2013 meeting of Senate committee on internal economy

8/13/2019 Transcript: May 8, 2013 meeting of Senate committee on internal economy

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THE STANDING COMMITTEE ON INTERNAL ECONOMY, BUDGETS ANDADMINISTRATION

EVIDENCE

OTTAWA, Wednesday, May 8, 2013

The Standing Committee on Internal Economy, Budgets and Administration met this day at 6:40 p.m. in camera, pursuant to rule 12-7(1), to consider financial and administrative matters.

Senator David Tkachuk (Chair ) in the chair.

[ English ]

The Chair: Colleagues, I call the meeting to order.

Just a lock-up that we have here; we're going to have the reports distributed and you'll have anhour to read, have a bite to eat, talk amongst your colleagues, and then Deloitte is going to come at6:30 and we'll be able to ask questions, and then we're going to consider the three reports.

For the purposes of due process, and the fact that we have informed the three senators that we aremeeting today and we are meeting again tomorrow morning, what I'd like to do tonight, with yourconcurrence, is that we discuss all three reports today, of the subcommittees, that we finish ourdiscussion but not have the vote, that we would wait for the vote tomorrow morning in case somesenators aren't able to make it tonight and can make it tomorrow morning and I understand that that's

the case.

So what we'll hopefully have is an agreement that we can actually complete any debate we mayhave and not restart it tomorrow, but to allow the they can get copies they'll all be able to talktomorrow and say what they want to say, and some of them may be here tonight, I don't know that,

but they won't be here until 6:30, but my understanding is that we'll have one or two here tonight after6:30.

The last item is we have the travel policy and we will deal with that tomorrow, unless we havetime tonight. If we go lickety-split through this thing then we'll deal with the travel policy tomorrow

I do, I am an optimist as you know, George so that's what we'll try and do, if not, then we'llfinish the travel policy off tomorrow morning.

We have the room tomorrow all morning in case we need it, the room tomorrow morning, ourregular meeting room, 160, we have that all morning, starting at 8:30, so that's when we reconvene.

Senator Cordy: Chair, you say they will be able to speak tomorrow, you mean the three people

The Chair: Yeah, they can participate.

Senator Cordy: That was just a question, I'm not saying they should or shouldn't, I'm just asking,you said they, I wasn't sure.

The Chair: That's right, they as the three of them.

Senator Cordy: So do we get to ask questions?

The Chair: Well, I don't know if they lead us into debate I guess you can debate them. I meanwe're all colleagues here, so I think I'm going to just follow the rules that I would in regularcommittee, if a senator showed up he can participate, or she can participate.

Senator Cordy: I agree.


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Senator Furey: Are any of the three senators here tonight?

The Chair: As far as I know I think two are coming.

There are two coming today, we think.

Mr. Patrice: Yes, my understanding is that Senator Harb will be here tonight with his counseland Senator Duffy will attend tonight.

The Chair: Without counsel.

Mr. Patrice: Without, yes, that's my understanding.

The Chair: Anyway, good reading, and we'll convene formally at 6:30.

Senator Furey: Was there anything else?

Mr. Patrice: Basically Senator Harb's counsel asked if discussion on the report could be postponed Senator Duffy's, is that what I said? could be postponed until tomorrow.

The Chair: But I said no, we're debating it tonight.

Senator Furey: What was the reason?

The Chair: We're debating it tonight.

Senator Furey: Yeah, but what was the reason?

Mr. Patrice: She could not attend. Senator Duffy's counsel, but she would be able to attendtomorrow.

[Translation ]

Senator Carignan: I am sorry, but the process for the senators affected by the decision isintended to be fair and to allow them to participate or to make their views known.

My understanding is that they were invited to express their views tomorrow.

Am I to understand that they will participate today as well and that they will also be invitedtomorrow?

I think the first step is for us to get a handle on the issue and to take stock of the whole situationso that we can perhaps come up with questions to ask them tomorrow.

Otherwise, I have trouble understanding the process.

[ English ]

The Chair: The process is, and maybe if the translation misses something, Michel, you mightwant to help me, right?

Mr. Patrice: Yes.

The Chair: But we're going to spend this one hour going through the report in a lock-up fashion.We're going to call the meeting to order at 6:30, the senators were invited, they said they weretold, they were told of the meeting tonight and told of the meeting tomorrow at 8:30. Whether theywish to come tonight or they wish to come tomorrow or they wish to come both times, I didn't reallycare, right, it's up to them. So, some of them may show up here today. They'll be part of the process,

okay.


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I'm going to then, another question on procedure?

Senator Charette-Poulin: Just a question; you mentioned that Senator Duffy's counsel was notavailable to come tonight. Why would we say no to tonight then, why wouldn't we accommodateSenator Duffy so he could have his counsel tomorrow?

The Chair: We're not voting today, so if there's anything he wishes to say tomorrow, he can sayit.

Senator Charette-Poulin: But . . .

[Translation ]

Senator Carignan: I am just trying to understand, because they cannot participate in thecommittee proceedings related to the case. They can express their views without participating in thedecision-making debate. I do not see how they could participate in that.

That can also prevent the more timid senators from expressing their views during the debate if the person is there.

Senator Charette-Poulin: In addition, if Senator Duffy is more comfortable with his lawyer, Iwould like him to have an opportunity to have his lawyer with him.

Senator Carignan: Yes, that is true as well.

Senator Charette-Poulin: I would really like us to be more than fair.

Senator Carignan: Yes, I agree.

[ English ]

The Chair: They've been invited. They can come if they wish. Their lawyers cannot speak.They're senators. They can participate for all I care and they have the right to participate.

Senator Carignan: Mic please.

The Chair: They have no right to vote. So with that, let's start the lock-up. George.

Senator Furey: Sorry, chair, there's one other issue that Senator Charette-Poulin just slipped mea note indicating that it is her understanding that one of the counsel coming is Mr. Bastarache; is thatcorrect? The committee should be aware that Senator Charette-Poulin is a colleague ofMr. Bastarache's at Heenan Blaikie. That may put Senator Charette-Poulin in a conflict.

Senator Charette-Poulin: So I will leave the room at that time and Senator Fraser is replacingme officially so she will be able to vote in my place.

(The committee suspended.)

(The committee resumed.)

The Chair: Welcome, colleagues; could we have some order here. We have a number ofmeetings going on at the same time.

The process now will be, we have the auditors here so they're open for questions. I want to alsolet Senator Harb and Senator Duffy, if they want to ask a question, they may do so. Just get on thespeaker's list the same as us.

Senator Stewart Olsen: When may I move this motion?


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Gary Timm, Partner, Financial Advisory, Deloitte LLP: In terms of when we did that analysis actually, I do want to mention, Alan mentioned that Senator Duffy wasn't available to meet. Latein the process there was an offer for Senator Duffy to meet with us and we were directed that, by thecommittee, in order to not have any delays, to not meet with him. So I just want to caveat what youhad said, Alan, okay.

In terms of our analysis, and I'm not sure that we had some slides where we put all the analysistogether, so since I won't be able to do the slides today, what I may do is instead of going through totry and deal with that detail, what we did was we used the four indicators as you saw in the report thatwere used by the committees and we've got that summarized. We also then looked at the variousother documents to try and determine a location of the senators on the 549 days in question, under ourreview period, and from that that's documented again in the reports. I'm not going to go through allthat, but the one emphasis though as well is that for the majority of those days we're able to confirmthat we feel very confident in the location that we've identified where the three senators were. That'sshown in the report as well, and then the tables in our reports, I know you've had them so I'm notgoing to go through those numbers. We had summarized them and put them side by side so that wecan have some comparisons today. Unfortunately, there was a bit of miscommunication and we only

brought it in English. I apologize for that.

At this point I'll stop there and we'll take your questions.

The Chair: Okay, Senator Furey.

Senator Furey: Thank you chair.

Senator Duffy: Mr. Chair, I'm sorry to interject, but just so I get it on the record, I'm objecting to I'm here to observe, but I will not take part tonight because I was only informed of this meeting atfour o'clock and both of my lawyers were unable they were previously committed to other things.They communicated that to Mr. Patrice, asking for a delay until tomorrow, and they were told thatthis would be discussed tonight and tomorrow. So I'm here but I want to file that protest and, as anaside, I'm a bit surprised we can read about this from Bob Fife but not get notice til four o'clock.

The Chair: Senator Furey.

Senator Furey: Well, I'm a bit loath to begin asking questions. Would it be appropriate for the

committee to discuss what Senator Duffy has just introduced?

The Chair: No, I think we should get right to the point of let's discuss the report and let'sdiscuss the three reports. They're here to answer questions so that senators are well-informed aboutwhat they're going to be talking about when we consider the report, so Senator Munson.

Senator Munson: I don't know, chair, how this can be a fair process unless Senator Duffy haslegal counsel with him. I mean we are here for two days. I think there is a process that we have to

be

The Chair: Senator Duffy has informed me that he will have legal counsel tomorrow.

Senator Munson: I don't know how we can talk about Senator Duffy in his particularcircumstance from the auditor's report without legal counsel being here to witness the conversation.

The Chair: Senator Cordy.

Senator Cordy: And I agree with that. I think that with due process it should, he should haveaccess to it.

The Chair: Senator Campbell.


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Senator Campbell: There's a rush to justice here that is so unsightly that it makes we want tothrow up. There is simply no way that you can expect somebody to defend themselves when youhaven't told them that there is a meeting, that they don't find out till four o'clock and then you insiston ramming it through. It's unjust, it's not fair and I'm not going to participate in it.

The Chair: Senator Campbell, we are not voting on any report. What we're going do is start the

Senator Campbell: We are not talking about voting on any report. We're talking aboutdiscussing the report that involves senators, and when they don't find out that we're having a meetingand they don't have the opportunity to participate in it it's wrong. It is simply wrong. There is no rush.There is nothing here that says this has to be decided tonight, tomorrow or next week. This is being

pushed by you, by your side, and it's wrong and we're going to pay for it down the road.

The Chair: All right, any further discussion? Senator Fraser. Senator Carignan and then

Senator Fraser. Sorry about that.

[Translation ]

Senator Carignan: I am sorry, but allowing the senatorsSenator Duffy, Senator Harb, SenatorBrazeau, who is not here, but I understand was notifiedto be here when the report is being read andthere is still a debate going on... The report is complete and was received by the senators a few daysago, if I understand correctly. We are in the process of deliberations. Allowing the senators to be partof this process is a rather exceptional privilege; it is quite rare for the people targeted by a decision to

participate in the proceedings.

In terms of following the rules of procedural fairness, they have never been followed to thisextent in my experience. It seems to me, seeing a judge involved in the discussions with the parties isas good as I have ever seen.

There is another meeting tomorrowbecause the decision will not be made todayat which thesenators will be able to express their views, using documents, reports and draft reports; they will beable to give us their side of the story in compliance with the rules of procedural fairness. I personallyfeel that being called on short notice or not having your lawyer with you does not break the rules ofnatural justice and procedural fairness because we are currently dealing with something that goes

beyond the rules.

I understand this may make us uncomfortable, but, in my view, this is out of the ordinary.

[ English ]

Senator Duffy: Mr. Chair, I don't want to impede the committee in any way. I just wanted to puton the record my concern. I'm quite happy to sit here and listen, take notes. My lawyer will be heretomorrow morning, and I understand everybody's busy and so on. It would've been preferable had Iknown earlier to be able to make arrangements, but what's done is done. I don't want to be aroadblock to this. I just want to put that on the record and reserve an opportunity tomorrow to

basically make my case.

The Chair: That was my understanding. Senator Fraser.

Senator Fraser: It seems to me that we may not need to make quite such a big deal out of this asit seems. I would agree that when we come to specific discussion of Senator Duffy's case, it would begreatly preferable for him to have his counsel here, but Senator Harb has his counsel here.Senator Brazeau I gather has not responded. Silence lends consent, so we will assume that he's okaywith having things go on.


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We have the auditors here. They've just explained to us in some detail how they followedcomparable procedures for all three reports. Any questions that we address to them will presumably

be based on the comparable format and procedures that they followed so they would be applicable toall three senators. It seems to me that if we manage to get through that plus discussion of SenatorsHarb and Brazeau this evening we will have bitten off a great chunk and can turn ourselves to thespecifics of Senator Duffy's case tomorrow, when he has his counsel here.

Might I, for the record, chair, say that I actually disagree with the auditor's conclusions aboutunclear language? Clarity of language has been my business for more than 50 years now, and I havenever found the least ambiguity in those particular sections of our rules.

The Chair: Thank you, Senator Fraser.

Just so that it's on the record for the whole Internal Economy Committee, the members, the threesenators received the audit reports on Monday, at the same time that we received them. They were

free to talk to counsel, to study it no, no, the same time as the steering committee and thesubcommittee got them, right, and we deliberated, the subcommittee deliberated and so did we. We

just finished up this afternoon at two o'clock, our deliberations, and we're trying to move the processforward.

We're trying to be, or I think we're trying to be as reasonable as we can, and with that, anyquestions of the auditors? I will start with Senator Furey.

Senator Furey: Just for the record, I share the concerns expressed about the due process. I wasnot part of the decision that indicated we would proceed and I share the concern expressed by

Senator Fraser that apart from general comments, which the auditors have already made, when itcomes to Senator Duffy's report that we delay that until tomorrow when he has an opportunity tohave counsel with him.

The Chair: Senator Duffy's report will be discussed today. We can begin the discussion today. Iwant all three reports discussed today if we can, and then we'll continue the discussion tomorrow andhave our vote. So with that, Senator Furey, do you have any questions?

Senator Furey: I do.

In your deliberations you're trying to determine what primary residence was. I know you wentafield of the actual report that senators signed declaring what their primary residence is to state thatthey're on travel status within the NCR. Did the travel patterns of the senators that you looked at,were they taken into consideration when you were trying to determine basically where these people,where their primary residence was?

Mr. Stewart: Yes , they were.

Senator Furey: Did that not clarify anything for you?

Your report says, for example, that some senators, their predominant travel pattern is Ottawa tosome other place in Canada, to Ottawa, versus some other place in Canada to Ottawa and back again.Didn't that tell you anything?

Mr. Stewart: I believe you're speaking about the specific claims that certain senators made,Senator Furey.

Senator Furey: I'm talking about the general pattern. You've identified general travel patterns.

Mr. Stewart: Correct.

Senator Furey: Was the general travel pattern any assistance to you in trying to determine wherethe primary residence of the senator was?


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Mr. Stewart: The travel pattern that we established for each of the three senators

Senator Furey: Okay, let me make sure you're clear on what I'm asking. I'm from Newfoundland, from St. John's. If my primary travel pattern, my predominant travel pattern isOttawa, St. John's, Ottawa, versus St. John's, Ottawa, St. John's, does that tell you anything about

where my primary residence is?

Mr. Stewart: I would say it depends on the number of nights you might spend at any location.

Senator Furey: I said predominant, so the majority were Ottawa, St. John's, Ottawa?

Mr. Stewart: It depends on your definition of primary residence.

Senator Furey: We're back to that.

Is there an ordinary definition of primary that you're familiar with, an ordinary dictionarydefinition without going afield?

Mr. Stewart: Of primary?

Senator Furey: Yes .

Mr. Stewart: I believe that would be first.

Senator Furey: For now, thank you.

The Chair: Any other questions? Senator Downe.

Senator Downe: Are you familiar with Canada Revenue Agency's definition of residence fortax purposes and what is that if you can inform the committee?

Mr. Stewart: I am familiar that there is one and I'm familiar it is quite specific as to the numberof days but, I'm sorry, I don't know the exact number of days that is required for residency.

The Chair: Any other? Senator Comeau.

Senator Comeau: In your study, did you look at such items as in order to confirm residence

such as where one goes to church or where one's children live or where one's spouse may live, clubs,volunteer groups to which you might belong in the community, in other words to establish acommunity within which you reside as your home versus a community in which you work? Youknow, in other words, if you, if Ottawa, for example, is my away-from-home residence, I probablydon't belong to too many clubs and so on, whereby at home in Nova Scotia I belong to clubs. Did youlook at this kind of pattern at all?

Mr. Timm: No. What we were looking at is trying to determine where they were on any givenday in the 549 days, and again, going back to the definition of primary, or whatever, what you'resuggesting is potentially some criteria. We mention in there that there are no criteria that we as

auditors can measure against to make that conclusion. What you're suggesting is some criteria thatcould be used to measure that. So without that criteria we did not, as auditors, go out and try to

benchmark that and we couldn't because that's not something we you benchmark what exists andthat we don't see in your criteria.

The Chair: Are you done, Senator Comeau?

Senator Comeau: Yes .

The Chair: Senator Munson and then Senator Fraser.


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Senator Munson: Thanks for being here. Just first a simple question: I'm not used to going overauditors' forensic audit reports but I'm used to going over different reports and you do seeobservations and findings. Why don't you have recommendations based on what you gleaned from allof this information that the senators gave you?

I recognize you were using the words lack of clarity, but for my purpose it would have beenhelpful to, based on all the evidence that we have in front of us, a recommendation or two might have

been helpful. You don't do that, or you just go A, B, C, D, whatever adds up at the end of day?

Mr. Timm: In fact, typically, in terms of the report, we report our findings, number one, but thenthere typically as well, in a number of our engagements when we do these types of engagements therecan be, I don't want to say a management letter but a separate letter that provides recommendations.In fact, we had talked about that we could potentially look into doing that as well, absolutely, butright now we are trying to answer the questions in terms of findings in this report. So it is part that wehave done it and do do it, it 's just . . .

Senator Munson: Why didn't you do it in this case? I'm not getting that.

Senator Fraser: You weren't asked?

Mr. Timm: It wasn't as effectively we weren't asked to give the recommendations butcertainly I want to say that I believe they would be a welcome as indicated in terms ofrecommendations but we were trying to answer the mandate that we were asked to provide here.

The Chair: Senator Munson, are you done? I have Senator Carignan, Senator Fraser and

Senator Tardif. Senator Carignan.[Translation ]

Senator Carignan: Let us agree that this is lacking clarity. My understanding is that, if we lookat the term primary residence in isolation, primary means that it comes first. That is sort of whatyour figure showed.

The only trouble is that the words are being used in different circumstances without beingdefined. The following terms are used: primary residence on occasion, secondary residence,NCR residence, provincial residence and registered residence. The definition of primaryresidence refers to the principal residence. What is the primary residence? Is it the place of birth?

So there are a bunch of words being used indiscriminately to refer to different places, which isconfusing. That is my understanding of your remarks.

[ English ]

Mr. Timm: That's exactly right.

The Chair: Senator Fraser.

Senator Fraser: Thank you; just two points of clarification. I happen to be looking at the reporton Senator Harb's claims but I think it's the same in all of them. The tables you present use theheading primary residence. You've just been explaining to us you don't know what that means. Itake it that that refers to what the senator has declared as his primary residence.

Mr. Timm: That's correct.

Senator Fraser: Okay.

Mr. Timm: If you move to page 2


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Senator Fraser: In the body of the text you say that but I'm looking at the tables.

Mr. Timm: If you look at the tables, page 2 of Senator Harb.

Senator Fraser: Page 2.

Mr. Timm: Page 2, table 1.

Senator Fraser: Declared primary residence.

Mr. Timm: It says declared primary residence.

Senator Fraser: There are a number of others. I just wanted to be sure that we were all talkingabout the same thing.

Similarly, I'm now into these lovely colour-coded columns and one of them carries the heading

primary residence-day trip. Could you just explain what that means; a day trip to the primaryresidence, from the primary resident, both, neither, I don't know?

Mr. Stewart: That's where we had evidence that the senator, in this case Senator Harb, made aday trip to or from the primary residence.

Senator Fraser: To the National Capital Region.

Mr. Stewart: Yes .

Senator Fraser: To or from, and you don't know which way it was, or at least this table doesnttell us which way it was?

Mr. Timm: Initially, basically because we were asked about privacy concerns, in each of these boxes it actually identified which way it was. So we've taken it out basically because of privacyconcerns for all of these in here. So yes, it did have it initially.

Senator Fraser: Okay. Thank you chair.

The Chair: Senator Tardif.

Senator Tardif: Thank you, chair. In your reports you indicated that documentation, that somedocumentation was not available or not received. What effect did this have on your fact finding?

Mr. Stewart: As we said in terms of our ability to confirm the location of each of the senators onany given day in the period, we are very confident that we have identified the location of the senator

based on the information that was available to us. There were certain things that would perhaps have been more helpful in explaining some of the unexplained days or putting some of the likely days intoa confirmed category and also, without speaking to Senator Duffy, we couldn't confirm certain thingsthat we have perhaps assumed, that, for example, his cellphone was constantly in his presence, heused his cellphone all the time because we used his cellphone for a lot of his location.

Senator Tardif: I guess I'm trying to determine, based on the fact that you had no documentationin some cases, you are unable to indicate whether the locations were likely or not likely orunconfirmed. How can you establish, I guess, some of the claims that you've made?

Mr. Stewart: Perhaps it would help if I explained in a little more detail each of those threecriteria. Where we have a confirmed location, we would have one or more of a cellphone transactionor a financial transaction, or some other indicator that would confirm one of the senators' locations asOttawa, Gatineau, wherever we have put them. That would be confirmed. An example of a likelylocation would be where we have a confirmed location on a Monday in Ottawa, say, a confirmed

location on a Wednesday in Ottawa, but no information on a Tuesday, so no cellphone, no financial


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records, nothing else. We would consider it likely that the senator was in Ottawa that Tuesday, themiddle day. That would be a likely.

Where we have unconfirmed, that is where we have basically no indication and no previousdays or subsequent days that would allow us to conclude that they likely were in one location over

another. In some cases some senators travelled internationally, so we may not know exactly wherethey were.

Senator Tardif: I'll leave it. Thank you, chair.

Senator Kinsella: Does Revenue Canada issue interpretation bulletins as to residence?

Mr. Stewart: I believe they do.

Senator Kinsella: Would you know how many interpretation bulletins Revenue Canada hasissued on the term residence?

Mr. Stewart: I'm sorry, I don't.

Senator Massicotte: I just read these things. I'm not a member of the committee but I read them briefly. The mandate was obviously, it seems to me, that we're trying to find out whether this demandof reimbursement of expenses was consistent with the intended policies of the Senate. What I'mhearing tonight is because in your mind the definition of residency is not crystal clear; you couldnot satisfy that objective or that mandate. So the rest of the exercise is providing what I call semanticsor technical information on facts, but, again, without really satisfying the mandate.

So, given you knew what the mandate was why would you not have used a common senseapproach of principal residence or looked up in Webster's Dictionary principal and say, Giventhose circumstances, let me try to get to the answer? Why wasn't this even attempted as opposed tosimply saying unclear? Let me provide an appendix of additional information and I'm out of here.It seems like a cop-out. Why didn't you do that?

Mr. Stewart: Part of our mandate was to assess the claims into three different potentialcategories: appropriate and keeping with Senate practice; subject to reimbursement; or subject to theinterpretation of this committee.

As Gary outlined, and I think I've said as well, there are no specific benchmarks that we can applyto understand the intent, which you just spoke about, of the Senate in deeming a primary residence.We have set out a number of facts that could be used to interpret primary residence. There areothers, like the clubs that you are members of, where your spouse resides, where your children reside,et cetera. We are categorizing these expenses in that third category, which is subject to thiscommittee's determination.

Senator Massicotte: But if you couldn't satisfy the mandate, did you advise your employer,saying, Let me ring the bell. I'm not going to get there. I know what you've got to get at, but, giventhe lack of clarity and given I don't want to use any discretion to get there, I can't satisfy theobjectives of the mandate, which you obviously knew what it was. Did you advise your employer,saying we are going to do all of this work and spend all of your money for maybe a nil conclusion orfor something that is not very clear?

Mr. Stewart: With respect, I don't think it is a nil conclusion. We've categorized expenses into athird category, which is putting it back to you to determine whether it is appropriate or not. And, yes,we advised the subcommittee and the steering committee as we went that this was our likelyconclusion.

Senator Massicotte: The percentage of time is not a definitive conclusion, in my opinion, of

residency. There is a lot of other stuff and I'm surprised you did not go into the other stuff. I see


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corroboration a lot of detailed information but I suspect there is a bit of frustration due to thefact that we got some reports but it doesn't tell us very much. It satisfies a pure accounting detailedaccumulation of information and it seems and I repeat the word like a cop-out. It seems like theeasy way out to avoid coming to a hard addition. Thank you.

The Chair: That was a statement or a question?

Senator Massicotte: A statement.

The Chair: That was a statement.

Senator Furey: I just want to follow up on Senator Massicotte's point. You were charged withassessing where the primary residence is located. I want to know what, if any, weight you give to thefact that senators signed documents declaring where their primary residence was. Would you haveassumed that they understood what they were signing or the reverse, and did you give any weight to

that?

Mr. Stewart: I'm not quite clear on your question, senator.

Senator Furey: Okay. When a senator signs a document indicating where his primary residenceis, or whether or not it's within 100 kilometres of the National Capital Region, did you give anyweight to that i.e. did you assume that a senator who signs such a document knew what they weresigning?

Mr. Stewart: I believe a senator would have his own interpretation of what that meant to him orher as he or she signed it, yes.

Senator Furey: So if a senator signed a document saying my primary residence is within 100kilometres of the National Capital Region, you would assume that the senator knew what he wassigning?

Mr. Stewart: Yes.

Senator Furey: Okay. Thank you.

Senator L. Smith: To follow up on the line of questioning from Senator Furey and Senator

Massicotte, page 2, page 3 I guess page 2 of Senator Harb, and then page 3 of Senator Brazeau;and then page 2 of Senator Duffy, just so I understand, you have been very clear on some of the lackof detailed information, but what are we supposed to ascertain of declared primary residence and thenumber of days let me start that back. You have identified a total of 549 days in each case as a

base point for measurement, is that correct?

Mr. Stewart: That's correct. That's the period that we reviewed.

Senator L. Smith: Right. Secondly, you have various definitions, if you like, of facts that youwere looking for in your graphs, is that correct? Is it correct?

Mr. Stewart: No; they're not definitions. That's the location of the senator at the end of everygiven day.

Senator L. Smith: Locations, right. There are two I would just like to ask about. One is TotalSenate Business and one is Declared Primary Residence. Did you use the definition of primaryresidence that we use as senators?

Mr. Stewart: We used the locations declared by the senators themselves on their annualdeclarations.


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Senator L. Smith: Were you going to tell us what those findings were other than us just readingthe report? I mean, I'm trying not to be rude, but I am just trying to understand. You have declared

primary residence for three senators. What are we supposed to glean when we look at the number ofdays and the percentages of each in terms of the definition of primary residence?

Mr. Stewart: We're setting out the facts. So for Senator Harb, out of the 549 days we identifiedthat at the end of 118 days in that period, he was at his declared primary residence and similarly forthe other two senators. It's at the end of that many given days they were at their declared primaryresidence. So we have made no interpretation of what primary residence is. That is what theydeclared their primary residence to be.

Senator L. Smith: Okay. So that if they declared that to be their primary residence, is that thesame definition that we use as primary residence within the Senate? So, therefore, would we beable, as a group, to ascertain that the senator spent that percentage of time in their primary residence?Yes or no?

Mr. Stewart: Yes.

Senator L. Smith: Okay. That's all. I just wanted to find out.

Senator Cordy: I think you and I are also frustrated with your comments, with the lack of clarityof the definition of primary residence. I think you have to look at what Revenue Canada wouldsuggest and what a reasonable person would ascertain when they were signing a document to saywhether or not their primary residence was within 100 kilometres.

Having said that, if in fact you've said there is a lack of clarity about principal residence, shouldin fact these senators have to repay money to the Senate of Canada?

Mr. Stewart: That would be up to this committee to decide.

Senator Cordy: But you are saying that the definition is fuzzy?

Mr. Stewart: Yes.

The Chair: Senator Cordy, any further questions?

Senator Cordy: No.

[Translation ]

Senator Carignan: In your observation on the lack of clarity, have you noticed that the Englishand French definitions are different? In French, rsidence principale was defined as the designatedresidence. In English, the term is

[ English ]

primary residency, the residence identified by the senator as his main residence.

[Translation ]

Is that part of the lack of clarity you have noticed?

Mr. Stewart: In terms of that definition, we feel the meaning is similar. Whether identified inEnglish or dsign in French, that has to do with

Senator Carignan: I do not think you understood my question. We are talking about thedefinition of primary residency that refers to the principal residence identified by the senator. InFrench, it is the other way around. The rsidence principale is defined as the designated residence.The words are switched around.


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Mr. Stewart: I do not see a problem with the two definitions.

Senator Carignan: Okay.

Mr. Stewart: Generally speaking, in our approach, the English version of the documents takes

precedence. Our report was based on the English version of the documents.

Senator Carignan: Okay, but not in the Senate. This will be my final comment. First, not in theSenate; and second, questions have been asked about taxes and the number of days.

Do you agree that being senators and having to move for a good chunk of the appointment tocarry out our duties does not mean that our primary residence is not outside?

A plumber who goes home every night might skip a few days from time to time, but has a home base as a general rule; it is easier to find. However, it is important to consider that senators arerequired to carry out their duties outside their province or home, which is not really considered in theincome tax. The income tax is not done for senators based on the definition of residence.

[ English ]

Mr. Stewart: Yes. I think income tax parameters are one of a number of variables and we haveset out another lot of variables in terms of time spent in various places, and there are others, asSenator Comeau mentioned, that we have not considered, but all can go into a definition of primaryresidency.

Senator Carignan: Okay.

Senator Kinsella: I would just like to pick that up. Now you have made reference to the IncomeTax Act. Would you be surprised if I was to suggest that there are multiple interpretation bulletinsfrom Revenue Canada as to what residence means under the Income Tax Act?

Mr. Stewart: Not at all. No, I think there will be many.

The Chair: Senator Fraser and then I've got Senator Massicotte and Senator Downe. Anybodyelse on the list? Senator Furey?

Senator Furey: Mine is actually just a follow-up to Senator Kinsella's. I would like to go back tothe point I made. You still do not change your mind, though, that if I say to you, you assume that if asenator indicates by signing a document where his primary residence is that he knows what he'ssigning? You make that assumption you said you did before, so I'm assuming that you're not goingto change that from your last answer.

Mr. Stewart: Okay. A senator signs for what he believes, she believes, is her primary residence.

Senator Furey: And you make that assumption on good faith?

Mr. Stewart: Yes.

Senator Furey: That they're not signing something that they don't know what the heck they'resigning?

Mr. Stewart: They have their own definition when they're signing it.

Senator Furey: And you assume they know what it is when they're signing it?

Mr. Stewart: Yes.

Senator Furey: Thank you.


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Senator Fraser: More than that, there's a follow up to Senator Smith's question because as I waslistening to Senator Smith's question, it seemed to me anyway, this is what I took from thatexchange that he was saying if you have a given number of days listed as having been included ata senator's declared primary residence can we take that to mean that that was the number of daysspent at the senator's real primary residence? Am I misinterpreting you, Senator Smith? No.

You answered yes, but everything else I've heard you say today has indicated that you are notmaking any judgments at all about what a real primary residence is. You are hanging your hat onwhat has been declared and you are absolutely refraining from judging where a real primaryresidence is. Am I correct about that?

Mr. Stewart: I much appreciate the clarification, but that's not what I took from Senator Smith'squestion.

Senator Fraser: You and I took totally different things. He's sitting down there nodding sagely at

everybody.

Mr. Stewart: We have made no interpretation as to real primary residence.

Senator Fraser: Thank you. What most senators would consider to be thank you very much.

[Translation ]

Senator Massicotte: Am I mistaken in saying that you referred to the Constitution and the factthat the definition of a senators residence is not clear?

[ English ]

Mr. Stewart: I don't think we said the Constitution was unclear.

Senator Massicotte: Relative to the nomination of senators and residence?

The Chair: Will you repeat your answer?

Mr. Stewart: We did not say the Constitution was unclear.

Senator Massicotte: Do you make reference to that relative to the residency?

Mr. Stewart: We make reference to it.

Senator Massicotte: Where is it again?

Senator Fraser: Page 6 on Duffy.

Senator Massicotte: Okay, English. What paragraph? I've got the French one. I guess myquestion would be and I have the French copy when you read that, whoever wrote this, wereyou looking at the English copy of the Constitution or were you looking at a French copy?

Mr. Stewart: I looked at the English copy.

Senator Massicotte: Yes? Because in the French one, residency is quite well-defined andaccepted in jurisprudence; in the English one maybe debate exists, but if you had a read the rightcopy. Thank you.

The Chair: Any further questions? If there are no further questions, gentlemen, thank you verymuch. You will be on call tomorrow, if that's okay.

Senator Duffy, did you have any questions?


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Senator Duffy: Well, I was waiting I did not realize these gentlemen wouldn't be heretomorrow.

The Chair: They'll be here tomorrow.

Senator Duffy: I see. I was simply going to follow up with a question of travel patterns. Ifsomeone drove their automobile from their province of principal residence and had it parked and usedin Ottawa, would the travel pattern not then be Ottawa to, say, Prince Edward Island and return asopposed to flying from P.E.I. to Ottawa and return? In other words, if someone tries to draw someconclusion out of the fact that people are flying Ottawa-Charlottetown return as opposed toCharlottetown-Ottawa return, maybe the reason is they have driven in the fall from Prince EdwardIsland to Ottawa and have a vehicle parked here which they use and then they don't have to fly fromP.E.I. to Ottawa in the first instance, they have driven. Therefore, the pattern becomes Ottawa-P.E.I.-Ottawa as opposed to P.E.I.-Ottawa-P.E.I.; something to ponder on the travel pattern issue.

The Chair: Is that a question well, you just stated the fact; you didn't draw any conclusion, theauditors, if I remember correctly.

Mr. Timm: That is correct.

The Chair: You stated the fact this is the travel pattern.

Mr. Timm: That was the travel pattern that was recorded on the travel claim and that is what wasstated in the report; that is correct.

The Chair: Right. Thank you, Senator Duffy, for that question.

Senator Cordy, we were going to end this but we will start again?

Senator Cordy: I am just curious because the auditors made mention of a couple of thingsregarding Senator Duffy. Will we ask them now about what they commented on in their introduction,or will we wait until tomorrow?

The Chair: You can ask. This is for all three of the audit reports, so ask ahead.

Senator Cordy: I am just wondering

The Chair: The more we get done today the less we have to do tomorrow.

Senator Cordy: In your introduction you said you didn't meet with Senator Duffy and you didn'tget documentation, but you did say that Senator Duffy did ask to meet with you. I wonder if you canrecall the date when he asked to meet with you, if you could tell us.

The Chair: It is actually in the report.

Senator Cordy: Okay. What would that be, then? Sorry. It's in the report, so I can find it later.You have it?

Mr. Timm: I've got it.

The Chair: Mr. Timm?

Mr. Timm: Okay. It would have been April 20, 2013. And that was a letter from Senator Duffy'scounsel, which attached a letter from Senator Duffy, okay?

Senator Cordy: But we don't have a copy of that letter, do we? It's not in the report, I don't believe. There's reference to it.

The Chair: No we don't. There's reference to the report; that's correct.


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Senator Munson: Briefly, on Senator Harb, can you go back to the recommendations part? I'mstill perplexed. You did not give us any recommendations to work with and yet we are going to bedealing with issues of payback or not payback, or whatever the claims may be, but in Senator Harb'syou did come to a conclusion on Senator Harb's travel expense claims that overall here is aconclusion: We have assessed that all trips between Cobden, Westmeath and Ottawa claimed bySenator Harb did take place or could have taken place.

Mr. Stewart: Correct. It was part of our mandate to assess that.

Senator Munson: But you did come to a conclusion on some of these issues?

Mr. Stewart: Yes.

Senator Munson: We could take from that recommendations or non-recommendations onSenator Harb, I guess, in terms of you made a conclusion. I just think we've had a vague night.

The Chair: We are not done yet, senator.

Senator Munson: I know, but I appreciate your answer.

The Chair: Senator Munson, these reports were sent to subcommittees. The subcommittees prepare reports for consideration and I believe they do have recommendations.

Senator Fraser: May I please squeeze in a supplementary?

The Chair: A quick question? Sure; why not.

Senator Fraser: A quick question and a quick answer.

Senator Munson: Why does it have to be quick?

The Chair: There is no hurry. I asked twice whether there were any further questions and nowyou are starting in.

Senator Munson: We just got these reports two hours ago; we are still thinking, processing,understanding.

The Chair: Senator Munson, please; Senator Fraser, please.

Senator Fraser: In answer to Senator Cordy's question you gave the date when you received theletter from Senator Duffy, but can you tell us when you had begun your examination of SenatorDuffy's expenses, even approximately?

Mr. Timm: I am going to say it would have been in or about early to mid-February 2013. I'mgoing by correspondence to Senator Duffy's counsel making a request for information. It might have

been a bit before that.

Senator Fraser: That would have been when you first contacted his counsel. Thank you verymuch, chair.

The Chair: Senator Cordy, do you have a question?

Senator Cordy: I didn't really have my hand up, but now that you have asked me.

The Chair: Well I had your name down on the sheet.

Senator Cordy: I wonder if tomorrow we could have a copy of the letter that Senator Duffyrequested. And also, Senator Duffy referenced a letter from you and that was included. Could we

have a copy of that letter?


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When I was appointed to the Senate I met with Mr. Blisle at the time. I told him about the factthat I have a property; the location of the property. I asked Mr. Blisle at the time and he cantestify before the committee if you wish if there was any issue with that whatsoever. He told meno. As a matter of fact, there are other senators who are less than 100 kilometres from the city andthey qualify. Senator, he said to me, these are guidelines. No issue there.

Every time I have renewed my declaration and signed the principal residence document, theaddress was on the property for the duration of when I became a senator up until now. There are rulesin place; I followed the rules. If there are changes to the rules and changes to the criteria that I canmeet those criteria, then I will follow them.

I expect colleagues that, when you deliberate and make your decisions on what is next to take intoconsideration a legal basis to take into consideration criteria as they are set out if there are nocriteria, if there are only indicators, you may want to revise those indicators and set them out.

I just want to urge to you that with the definition, as Speaker Kinsella said in terms of RevenueCanada, there are a number of various interpretations in terms of what defines principal residencies. Itry my best. I follow the rules as they are set out and, if these rules change, I will continue to abide bythem.

The Chair: Any further questions?

Senator Downe: Is this the same auditing firm that's auditing Senator Wallin? And, if so, what isthe timeline on that audit? Can we check that shortly? Is this the same group?

The Chair: I don't know if it is the same people working on the group.Mr. Timm: Yes. The answer is yes. Obviously, it is a different mandate so different things we

are looking at, but we have been asked to look at two additional years and so that material is comingin. We've got some in for the first year. The second year, hopefully we should have most of it by theend of this week. So we are working on that. Once we've got that, it's a matter of

Senator Downe: I could assume that by the end of June we'll have a document at the latest?

Mr. Timm: Absolutely.

The Chair: Thank you, Senator Downe.

Senator Tardif: Is the mandate that you have been given for Senator Wallin the same as themandate that you received for the previous three?

Mr. Timm: In terms of Senator Wallin, it's not looking at the issue around primary residence; it'slooking at the actual claims themselves, and it's a different issue in there that we are looking at.

The Chair: Okay. We are going to

Senator Tardif: So it is more specific?

Mr. Timm: Yes.

The Chair: Thank you gentlemen and please, tomorrow, if you could, at 8:30. Thank you.

As a result of the intervention of Senator Campbell accusing me of a rush to judgment, being atyrant, we are going to adjust the agenda. So today we're going to deal with Harb and Brazeau, andtomorrow morning we'll deal with Duffy and the travel policy, okay, 8:30 tomorrow.

Senator Campbell: Thank you, chair.


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The Chair: Honourable senators, we need enough time to finish tomorrow, so I would like yourcooperation that we finish at a reasonable time so if there's any changes and stuff, there's time thattranslation will be ready and it can be tabled. I think people have waited a long time for it to betabled. There'll be lots of time for debate, I gather, but it will be tabled tomorrow.

Senator Furey: Senator Tkachuk and I had a discussion about doing this and breaking off thereport on Senator Duffy and he wanted some sort of assurance that tomorrow we won't get boggeddown in debate and discussion about due process and that. I assured him that if he did that hewouldn't get it from our side.

The Chair: Okay? I might get it from mine, but that shows you how much control I have.

With that, honourable senators, Senator Cordy had a question and Senator Campbell, I think.

Senator Cordy: I requested letters one that was written by you to Senator Duffy and one that

was written from Senator Duffy to you.

The Chair: Yes.

Senator Cordy: I am wondering, because it is in the morning, if those letters could just be presented in the language in which they were originally written?

The Chair: We are arranging translation so it'll be all done.

Senator Cordy: You are?

The Chair: Yes, we are.

Senator Cordy: That's fabulous. I just thought maybe there wasn't

The Chair: I will now call on Senator Marshall to give the report of the subcommittee. It wasSenator Marshall, Senator Comeau, Senator Campbell. So, Senator Marshall, please proceed.

Senator Marshall: Thank you very much, Mr. Chair.

I assume everybody has a copy of the subcommittee's report. In my remarks I won't quote directlyfrom the report, but I will sort of follow that outline and emphasize what I think are the mostimportant points.

Even though Senator Brazeau was the first senator whose primary residence was referred to thesubcommittee, because Senator Harb is here tonight, we'll do Senator Harb and then I will backtrackand do Senator Brazeau.

Just some background information: It was December 6 of 2012 that the subcommittee was askedto investigate media reports with respect to Senator Harb's living allowances in the National CapitalRegion. Because we had already established a period of review for Senator Brazeau to be April of2011 to September 30 of 2012, we used that same period of time for Senator Harb. We didn't gooutside that period of time because we knew that, after looking at Senator Brazeau's expenses in a fairamount of detail, this was quite a big period of time to look at on a day-by-day basis, so we wanted tokeep it within a manageable time frame and also to have it consistent with Senator Brazeau's review.

Because we had started to do detailed work on Senator Brazeau, once we had gotten into SenatorBrazeau's expenditure claims, we realized the magnitude of it. So when we were assigned SenatorHarb's primary residence and related issues, we decided that we wouldn't take the time to go in anddo a lot of detailed analysis as we did with Senator Brazeau. Rather, we would refer it directly toDeloitte. We thought that that was the best course of action. So a contract was issued on January 3 of2013 to Deloitte for an examination of all claims and related documents for Senator Harb dating backto April 2011.


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Deloitte went through what the terms of reference was I won't repeat them, but they wereasked to review the travel claims and supporting documentation to determine whether the traveloccurred or could have occurred. Then they were also asked to categorize the claims and there wereseveral other factors. Those are outlined in the report that was issued by Deloitte.

When Deloitte did their work, they did their work along the lines that we had carried out our preliminary work on Senator Brazeau, and that's that they provided a detailed analysis of the claims.They used a variety of sources and they mapped out a daily calendar for each month for an 18-month

period. They used that, along with a lot of source documents, such as phone bills, the MasterCardstatements, et cetera, to determine exactly where Senator Harb's location was on a daily basis for the

period that was under review. We relied on that information. That information was fundamental tothe determination of Senator Harb's primary residence, in our opinion. I'll get into that later on.

If you look at page 3 of the report, I consider the primary issues within our report. There's a lot of background information, but if you look on page 3 you will see the full paragraph there that startswith Your subcommittee acknowledges Deloitte's observation regarding the absence of criteria. Wehad a lot of discussion regarding that with Deloitte and they've indicated that because there wasn'tany criterion, they were looking for something black and white to determine primary residence. Butin our deliberations, we spent quite a bit of time going back over the declaration of primary andsecondary residence. We looked at the guidelines that were in effect; we looked at the policies. And,after going through the material, we were of the opinion that we didn't think it was as vague as whatDeloitte thought it was. We thought that it was quite clear what the purpose and intent was of the

policies and the guidelines and the declaration of primary and secondary residence.

We summed it up. We spent a lot of time on the wording of this, but we felt that the purpose andintent of the policies, the guidelines and the declaration was to allow senators who do not have theirhome within 100 kilometres of Parliament Hill and would not be in Ottawa if it were not for the factthat they are senators and must attend Senate business to not incur additional costs foraccommodations to their own expense while in Ottawa to attend Senate business; and to claim livingexpenses in the National Capital Region, any residence owned or rented by a senator must be asecondary residence and not the place where he or she ordinarily lives.

So we felt that the language that was in the declaration, the language that was in the policies andthe language that was in the guidelines, we didn't think it was ambiguous. We thought that it wasunambiguous and we thought that it was clear, and we were of the opinion that if a senator resides

primarily in the National Capital Region, then he or she should not be claiming living expenses forthe National Capital Region.

So when we looked at Senator Harb, of course, we looked at the chart that was provided byDeloitte's, the chart that was done on a daily basis. If you look at the Deloitte's report, on page 2, forSenator Harb, we looked at the numbers and we said: Okay, Senator Harb spent 62 per cent of histime in Ottawa, and he spent 21 per cent of his time at his primary residence.

So we felt that his primary residence was actually in Ottawa and not in Westmeath. So for the 549days that we looked at, from April 1, 2011 to September 30, 2012, there were 103 sitting days; andSenator Harb spent 340 of those days in Ottawa, at his secondary residence, but only 118 days in his

primary residence in Westmeath. So we came to the conclusion that his primary residence wasactually in Ottawa, and he shouldn't have been claiming.

As a result, we're recommending that he be ordered to reimburse the receiver general for Canadafor any living and related mileage expenses reimbursed to him by the Senate of Canada for the periodApril 1, 2011 to September 30, 2012; and the amount to be reimbursed is outlined in the Deloitte'sreport.

Now, I should mention that Senator Harb's situation is a little bit different from Senator Brazeau'sin that Senator Harb, based on my understanding, is that he had a secondary residence in Ottawa prior


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to the period that we looked at. So what we are recommending is that an internal investigation becarried out on Senator Harb's travel patterns and living expense claims, that it be extended back to the

period prior to April 1, 2011. I think that the finance department would have records going backseven years, so we're recommending that we go back to that period of time.

Our third recommendation is that future expense claims submitted for reimbursement by SenatorHarb be overseen by the Subcommittee on Agenda and Procedure of the Standing Committee onInternal Economy, Budgets and Administration from the date of the adoption of this report, for a

period of not less than one year. When we use the term overseen, then we would leave that to thediscretion of the subcommittee.

So I would be interested in taking any questions.

The Chair: Would you like to move that the report be adopted so we can begin discussion?

Senator Marshall: I move that the report be adopted.

The Chair: Is there a seconder? Senator Campbell.

Discussion. Senator Furey.

Senator Furey: Thank you, Senator Marshall. I know you touched upon travel pattern, but whenyou were making your in your deliberations, did you put a significant amount of weight on thetravel pattern Ottawa-Westmeath-Ottawa? Could you just explain why you did that?

Senator Marshall: I can't say that we put a lot of weight on it, but we did acknowledge it, that

because the travel claims were outlined as Ottawa, Westmeath, back to Ottawa, it appeared thatOttawa was the primary residence. But that wasn't our primary consideration. Our primaryconsideration was the amount of time that was spent in Ottawa compared to the amount of time thatwas spent at the declared primary residence.

Senator Furey: So it was a combination of all those things?

Senator Marshall: A combination, yes.


The Chair: Further discussion?

Senator Munson: Senator Marshall, what is the amount you said it's here somewhere thatyou're recommending?

Senator Marshall: Yes. I can actually give you the amount, Senator Munson. I have it here. Theamount is around $43,056. It's on page 13, I believe, of the report. We would leave it to the discretionof the committee whether we would charge interest. We would want it consistent with we haven'tdone Senator Duffy's report yet, but we would look that, you know, if we're charging interest, that it

be applied consistently across the board.

Senator Munson: And when you talk about travel patterns and living expenses be extended tothe period prior to April 1, 2011, are you talking about going back to the time when Senator Harb wasappointed to the Senate? Are you going back forever?

Senator Marshall: No. I would expect that it would go back seven years. The finance departmentis required to keep seven years of records, so I would expect that we would go back seven years.

Senator Munson: Thank you.

The Chair: I've got Senator Johnson. Did you have your hand up, Senator Johnson?


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Senator Johnson: No.

The Chair: Who had his hand up? Then it would be Senator Carignan and thenSenator Massicotte, then Senator Fraser.

[Translation ]

Senator Carignan: Based on my understanding of the Deloitte report and the report you are presenting, it seems that the situation has been much clearer since June 5, 2012, with the policy in place, and that, before June 5, 2012, the situation was clearI would not go any further than that, butlet us say clear, given the fact that we were required every year to sign the declaration stating our

primary residence.

When was the first time we were required to sign the current document with our primaryresidence for reimbursement? When was the document adopted? When did it come into force?

[ English ]

Senator Marshall: We always had guidelines in place up to June 4 of 2012, and of course wehad the declaration that had to be signed. Then there was a policy that was put in place June 5, 2012.But we felt that each of those documents and policies and guidelines were clear. We felt that thedeclaration itself was very clear, that the intent was that if senators come to Ottawa for Senate

business, then they should be reimbursed for their living expenses. But if a senator resides primarilyin the National Capital Region, then he or she should not be claiming living expenses in the NationalCapital Region.

[Translation ]

Senator Carignan: Since when have we been required to sign this particular form on which wehad to declare our primary residence for reimbursement purposes? Might Nicole have theinformation?

[ English ]

The Chair: Senator Carignan, we've been signing that declaration since 1998.

Senator Carignan: 1998?

The Chair: Yes.

Senator Carignan: Okay. Perfect.

The Chair: Senator Massicotte, just so we're clear here: Senator Fraser and Senator Harb, andthen Senator Munson. Okay. We'll start with Senator Massicotte.

[Translation ]

Senator Massicotte: I assume that your subcommittee with its three members agrees with thosereports? Is it unanimous?

[ English ]

Senator Marshall: Yes. It was unanimous, and we spent a significant amount of time discussingthe paragraph that I referred to on page 3, because we felt that that was really the thrust of the wholereport.

[Translation ]


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Senator Massicotte: From your deliberations and review of the facts and information, wouldthere be a reason to conduct other studies or investigations on the senators claims, on Senator Harbsclaims in that case?

[ English ]

Senator Marshall: We don't feel that there's any additional investigation needed of the periodApril 1, 2011 to September 30, 2012. But, as I was saying earlier, I do think we need to go back,

because my understanding is that Senator Harb also had a secondary residence prior toSeptember 2011, and I think that it would be incumbent upon us to go back and take a look. But weweren't thinking along the lines of having Deloitte's do the work. I think that we do have thecapabilities in-house that we could do that.

Senator Massicotte: Thank you.

The Chair: Senator Harb. Senator Fraser. I'm sorry, senator. Senator Fraser.

Senator Fraser: I'm happy to let Senator Harb

The Chair: No, no. You go ahead, and then he can maybe if you've got issues, he can addressthem all at once.

Senator Harb: Honestly, colleagues, I think it would have been just very fair for me to have mylegal counsel ask a question of the chair of the committee, with the situation that basically you wouldthrow me into the train without me having the opportunity to defend myself with my counsel, who isa constitutional expert, who has a lot of experience in the field, and who could enlighten thecommittee on the notion of what is it you are trying to do here.

My colleague talked about the number of days I am here, but she ignored the fact that the tableshe mentioned, there are times that I'm outside of the country. There are 70 days, actually, during theyear that I'm outside of the country. If you were to take that and add it to the 21 days, that wouldmake it about 35 per cent of the time, or 40 per cent of the time.

I want to ask my colleagues how many of my colleagues spend most of their time in Ottawa.Many of my colleagues spend a lot of their time in Ottawa. If this is going to go out in the publicdomain and you're going to get every journalist calling around and finding out how many days didyou spend in Ottawa to determine whether this is your primary residence or secondary residence. Ifollowed the rules. Finance knew. I signed a declaration every year. It wasn't a secret. It was knownto everybody what it is.

Colleagues, I think we're making a big mistake here, absolutely a terrible mistake here, trying tocreate a political interpretation of what is supposed to be a legal fact, the facts as we speak of them.There are facts, and the facts state what you sign.

You have taken the effort in order to send me to an independent auditor who has looked at everysingle claim and who has concluded that I did nothing wrong with that. Now you want to take me

back seven years, without me having an opportunity to have proper representation. I don't think it'sfair, honestly, colleagues. I don't think it's fair at all.

Senator Furey: Can I ask Senator Harb a question, chair?

The Chair: Sure.

Senator Furey: Senator Harb, are you satisfied that you had adequate opportunity to first meetwith the committee that were doing the investigation, and subsequently with the auditors?

Senator Harb: I never met with the subcommittee, never had the chance.


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Senator Furey: How about the auditors?

Senator Harb: I met with the auditors about four or five different times, and I gave them everysingle document; and they concluded that, with the exception of their recommendation, in fact,they concluded that $623, they thought that reimbursable to the Senate. I met with the auditor, telling

her that I want to pay that, and she said to wait on that because this is subject to interpretation of thecommittee. That's the only thing that came out of this whole report, after costing me a lot of energyand financial resources in order to provide them with the documentation.

We met with them, and they looked at the rules and then they applied the rules as they see them. Ihave my legal counsel, which I consulted with, and he can testify to the fact that I met all of the rulesas they set out.

Senator Furey: But is there anything additional that you think you ought to have had anopportunity to supply to the auditors? Are you satisfied that you've given them everything that was

necessary?

Senator Harb: Everything they asked of me.


Senator Harb: Without any exception.

The Chair: Senator Munson.

Senator Munson: Two things. The reason I

The Chair: Sorry. Senator Fraser.

Senator Fraser: That's all right.

The Chair: It was just that I skipped your name and it went to Senator Harb, and after SenatorHarb was Senator Munson.

Senator Fraser: Let him go. He's my whip. I've got to earn brownie points.

Senator Carignan: Point of order. Will we have a period of time where Senator Harb couldexplain his point of view or present his argument somewhere in our deliberation, now, in one hour, ortomorrow? Can we have a period of time that we will listen to Senator Harb?

The Chair: We are listening to Senator Harb.

Senator Carignan: I don't think that we listen to Senator Harb, actually. I think it's that he triedto be . . .

[Translation ]

He is trying to be heard. Like the rest of us, he participates in deliberations, but I do not feel thatSenator Harb has the opportunity to express his view on the whole situation right now. I think weshould perhaps take some time, after Senator Marshalls presentation perhaps, to give Senator Harbthe opportunity to present his views in a structured fashion so that we can take a look at it allafterwards. Otherwise, that does not seem right.

[ English ]

Senator Furey: I don't really understand what you're trying to get at, Senator Carignan. We'renow in the stage where we're discussing the report, that Senator Marshall has presented. Senator Harbhimself has asked to intervene, and I think any time he asks, he should be given the opportunity to doso. So I really don't know what point you're getting at.


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The Chair: Senator, I've got to follow a speakers list here, so I'm going to try my best. I don'twant to skip Senator Fraser one more time. So I'm going to go to Senator Munson still, becauseSenator Fraser has said I could; and then after him, Senator Fraser, then Senator Kinsella. Is thereanybody else?

[Translation ]

Senator Fraser: Senator Carignan has not finished.

Senator Carignan: In line with what I was saying, I would like to address Senator Furey becausehe asked me a question and said he did not understand my view. I am talking about having somestructure and being fair to those who might receive a report recommending that they pay back

perhaps $100,000 or $150,000. That is a major conclusion that will have a major impact on SenatorHarbs situation.

I think we should listen to Senator Marshalls presentation and let everyone ask questions,including Senator Harb; but then, we should have the opportunity or give Senator Harb theopportunity to present his view and say whether or not he agrees with either the Deloitte report or thesubcommittee report, so that we can make a decision afterwards. Otherwise, I think we are missingthe boat.

[ English ]

Senator Furey: Okay. So you weren't suggesting, Senator Carignan, that he wait until the end;you're suggesting that he continue to intervene whenever he feels like [inaudible] speakers list.

[Translation ]

Senator Carignan: Yes, that is correct. And we should at least have some time for Senator Harb.

[ English ]

Senator Furey: But at the end, we offer him an opportunity to sum up or make a presentation ifhe so wishes.

Senator Carignan: Yes.

The Chair: I've got no problem with that. We're just going to continue on.

Senator Munson: Very good point, senator. Just a few points. Personally, I think that SenatorHarb has already been hung out to dry in the court of public opinion. I asked the figure, and it comesout to 43,000, and yet we turn on our television sets last night and a certain reporter talked aboutclose to 50,000. So somehow this information is getting out even before we senators see it.

Number two: The subcommittee, with respect, had a great deal of time to come up with yourreport, yet at 5:30 this evening was the first time I saw the first of three reports. And yet, we're beingasked this evening or by tomorrow to say yea, nay, or abstain on this, without having athorough look through this and to have a reflection on what is in this for Senator Duffy, for SenatorBrazeau and Senator Harb.

We also have lawyers around this table who will quiz Senator Harb about all of his issues, and yethis legal counsel sits behind me silent. So I'm not sure whether and I don't know how this works,

because I've never done this before, or in this kind of format whether he should have legal counselat this table. Because it seems that we're in a court now and judging a person's livelihood, judging a

person's life, based on something that I've only seen for two hours and 15 minutes. Thank you.

Senator Furey: If I may respond to that, Senator Munson. The committee is the directors of itsown committees, in general, are directors of their own procedures. But in past what we have done


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is allowed senators to have legal counsel. Legal counsel can sit with Senator Harb, if he so chooses;and Senator Harb, before answering any questions, can consult with legal counsel, but it's SenatorHarb who interacts with the committee in terms of questions. But in no way, shape or form would he

be impeded or stopped from consulting with legal counsel. If it feels more comfortable to have legalcounsel sit at the table with him, it's not a problem.

The Chair: Can I go to the speakers list, and then you can go forward? Because otherwise I'mgoing to lose track here, and I just want to make sure that everybody's got an opportunity.

Senator Munson, we went through the process last Wednesday. I went deliberately through it. Itwas a process that was decided by steering committee. We said what was going to happen. We saidexactly what was going to happen each day. We said how the lock-up was going to take place, thatyou'd be given an hour; there would be three reports the audit report would be circulated; and thenwe would deliberate the reports. You have to remember that your subcommittees have also studiedthese reports and these audits, as Senator Marshall so aptly put it, which is her job to do.

Senator Fraser.

Senator Fraser: Thank you, chair. I appreciate that the steering committee reached certaindecisions. I must say, I have been accustomed in the past, when in a lock-up, to have a little moretime to understand complicated documents, but we are where we are.

So the question I'm going to raise is very delicate. It has to do with all three reports. I want tostress that I make no judgment about the answer to my question. I am not qualified, nor do I have anyevidence, to judge the answer to my question, but I would like to know why nowhere in these reports

or, as far as I can determine, in any other proposed report is there any discussion of whether thereshould be penalties in any or all cases where money was wrongly claimed. By wrongly I mean notaccording to the rules. I hear no discussion about whether, as this Senate has done in the past in orderfor an unbiased judgment about the ultimate disposition of cases, whether any or all of these casesshould be referred to outside authorities for examination.

I repeat: I do not know what such an examination or such penalties would consist of, and I'm notsure any of us around this table knows. But I do know that we will face a barrage of questions aboutwhy we did not even address this matter. So I'd like to know, to begin with, why the subcommitteedid not.

Senator Marshall: Thank you, Senator Fraser. We actually did discuss the issue of penalty, aswell as disciplinary action. The penalty that we decided on was a repayment of the amounts that had

been paid, plus interest.

Senator Fraser: So there is no penalty. So repay money that was I've had the financedepartment come back to me and say, You made a mistake. Send back the money, not only here butelsewhere. And I didn't consider that a penalty; I just considered that it's like when your tax peopleget when the tax people give you a reassessment and say, Oops, sorry. You owe more moneythan we thought. I don't think that's a penalty.

Senator Marshall: That was the issue that we talked about. And we did discuss disciplinaryaction, and we decided that we would not recommend that in our report. We were aware that thesteering committee was reviewing a senator, in addition to the two that we were reviewing, and thatthe issue may come up at the committee. But the subcommittee did not recommend anything in thearea of disciplinary action, although we discussed it.

Senator Fraser: Here I am jumping in with all my hobnailed boots. Why did the steeringcommittee not make recommendations of this nature?

Senator Marshall: No. What I had meant if I said steering committee, I had meant theInternal Economy Committee, Senator Fraser.


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Senator Fraser: You meant the whole committee?

Senator Marshall: Yes, this committee, because we knew that we had to report back to thiscommittee, and disciplinary action was a very serious thing.

Senator Fraser: It is. Understanding I'm not out on some kind of crusade here, but I think this isan issue we cannot evade.

Senator Furey: Just to follow up on that, Senator Marshall. I take it from your response that youwere leaving that matter to the full committee; is that what you meant?

Senator Marshall: We had talked about it within the subcommittee and we had decided againstrecommending disciplinary action, but we did discuss the possibility that it was something that thefull committee may discuss during its deliberations.

The Chair: Senator Kinsella.

Senator Kinsella: Thank you, chair. I'd like to turn to the second report of your committee,Senator Marshall, the one dated May 9, and to page 3, the second paragraph, where the report statesthat:

Your Committee acknowledges Deloitte's observation regarding the absence of criteria fordetermining primary residence. It is nonetheless our conclusion that the Primary andSecondary Residence Declaration form in force during the scope of these investigations andsigned by Senator Harb is amply clear, as is the purpose and intent of the guidelines (as ofJune 2012 . . .)

I wonder, chair, whether, through you, I could ask Senator Harb: Is it his view that the purposeand intent of the guidelines, as of June 2012 policy, were amply clear?

Senator Harb: The guideline and the policy talk about the address where you put the mailingaddress, like your driver's licence address, your principal health card address, your income taxaddress, those mailing addresses. I'll be honest with you; I wasn't aware of that at all. I wasn't evenaware that this existed at all.

My understanding of the driver's licence, provincial health card and income tax were for the

provincial, that if you are from Manitoba, for example, or Newfoundland, you have to have a healthcard in Newfoundland, you have to have a driver's licence in Newfoundland, you have to pay yourincome tax in Newfoundland. I had no idea those applied to Ontario, because I'm an Ontario resident.Therefore, my primary residence or my secondary residence, I had no issue with putting theaddress as my primary residence or secondary residence. The only reason why the address was here,my secondary residence, because I do my banking here.

Senator Kinsella: So are you disputing

Senator Harb: Well, I'm saying these are indicators. These are not

Senator Kinsella: the words that are in this report on page 3, where the committee is advisingthis committee that the criteria for determining primary residence is amply clear, are you telling usthat, in your view, they are amply clear or not amply clear?

Senator Harb: Not amply clear. I have legal counsel here who could testify to the fact. This is alegal matter we're dealing with. This is more than a political matter. That's why I'm not equipped inorder to handle legal issues. That's why I brought my legal counsel.

Senator Furey: Let's follow up on that, chair.


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The Chair: Honourable senators, maybe you can give me some guidance here, from both sides.Senator Harb is here to listen and participate in the debate. He is not a witness.

So I just want you to know, Senator Harb, if you don't want to answer any questions, you don'thave to. But if you want to participate in a little debate I'm going to give it some licence to allow it

to happen. I just don't want it to preoccupy our time and we're not sitting here interrogating SenatorHarb.

Senator Furey: No, no. I just wanted to clarify the question your response to the question thatSenator Kinsella raised. When you signed that document whether you agree with the committee ornot is another thing, but when you signed that document that your primary residence is more than 110kilometres, you clearly are saying that Westmeath is your primary residence.

Senator Harb: That's my home. This is a home that I bought

Senator Furey: So there's no confusion about that in your mind?

Senator Harb: Absolutely. This is my home. This is where I entertain my family. This is where Ispend my time. This is where I go every Friday, come back every Sunday. This is where I spend mostof the time during the summer, when I'm not in the Senate.

Senator Furey: And that document, in your view, didn't lack any clarity when it came to tickingthat box?

Senator Harb: Over a hundred kilometres. Of course that's what it is.

Senator Furey: Okay. Now, whether you agree with the conclusions of the committee, thesubcommittee, that's a different thing; but there was absolutely no doubt in your mind that when youticked that box, that Westmeath was your

Senator Harb: That's my home.

Senator Furey: primary residence, and you understood what a primary residence was?

Senator Harb: Absolutely, I know.


Senator Harb: This is my home. This is my place. This is where I entertain my family. This iswhere my brothers and sisters go. This is where we have our big meals.


Senator Harb: Furthermore, it is my hope that we it's a legal matter. We need to look at it inlegal terms, not political terms, and I beg you don't look at it in political ways. Look at it in legalterms, what we are dealing with here. That's why I have my legal counsel with me.

The Chair: Any other questions? Senator Johnson.

Senator Johnson: Senator Marshall, your subcommittee recommended number 2. Would youexplain that to me, please, that you want to do a further investigation, and prior to April 2011?

Senator Marshall: Yes.

Senator Johnson: Why is that?

Senator Marshall: Thank you very much, Senator Johnson. Yes. As I was saying at the beginning of my presentation, the first senator that was referred to the subcommittee was SenatorBrazeau, and a period of review was established upfront as April 2011 to September 2012. So of


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course when we did Senator Harb, by the time we started Senator Harb's review, we were aware ofthe magnitude of the 18-month review that we were doing for Senator Brazeau. So we use the same

period of time, 18 months.

But we are aware that Senator Harb had a secondary residence prior to April of 2011, so we felt

that we should go back to the prior period to see if there are any issues similar to the issues that wereraised by the external auditors.

Senator Johnson: But you've already investigated it as a secondary residence

Senator Marshall: Yes, but

Senator Johnson: primary residence, so

Senator Marshall: But it was only for an 18-month period, and we haven't done anything wehaven't looked at anything relating to expenditures prior to April 2011.

Senator Johnson: And you feel you have to?

Senator Marshall: Yes, we feel that it's warranted.

Senator Johnson: Thank you.

The Chair: Any further questions? Senator Massicotte.

Senator Massicotte: Thank you, chair.

I don't have an opinion. I didn't study the information as you did, Senator Marshall, and yourcommittee. I'm sure you're acting in immense sincerity, immense honesty, and I appreciate that. Butlet me just be a devil's advocate, because I guess we're all searching for the truth and proper justice. Iguess two contrary opinions. Let me start with the first one.

When you say your committee's not recommending any penalty, whatever, I'm just sort ofthinking about what the public will say is fair. The best comparison: Somebody robs a bank, and hesays, Well, I brought her home. Oops, you got caught. He puts back the money. It doesn't seem to

be a proper balance of fairness if that's the only consequence.

How do you respond to that?

Senator Marshall: Well, I wasn't looking at Senator Harb's

Senator Massicotte: I'm not talking about Senator Harb. I'm talking a

Transcript: May 8, 2013 meeting of Senate committee on internal economy

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Transcript of Transcript: May 8, 2013 meeting of Senate committee on internal economy