Scrutinizing private members' bills

When Bill C-228 was passed unanimously by the House of Commons last month, there was plenty of self-congratulation among MPs and enthusiasm from pensioner groups and trade unions. The legislation, now before the Senate, will radically alter Canada's bankruptcy law by giving pension plans super-priority when a company fails.

That means a defined benefit pension plan will rank with unpaid taxes at the top of the list when a company fails, ahead of secured creditors like banks and unsecured creditors like suppliers and landlords. The goal is to protect pensioners from suffering a cut in their expected payouts when a company goes bankrupt and leaves behind a pension plan with a large unfunded deficit, as occurred with the failures of Nortel and Sears.

"This is what Canadians want to see, Parliament working together to improve our country," said the bill's sponsor, Conservative MP Marilyn Gladu.

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On this topic, read: Broken branches: Has Ottawa undermined the lawmaking process?

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But critics say Bill C-228 is the product of poor public policy, a politically expedient piece of legislation that short-circuited careful oversight and industry consultation in its formulation, a measure that will lead to massive unintended consequences and possibly be challenged in court because of imprecise drafting. The Canadian Bankers Association, which has warned of the bill's negative effects on companies seeking credit, wasn't even given the opportunity to present its views to the Commons committee studying the bill.

And it's happening more and more often. Before the last election, Parliament passed Bill C-208, a change in the Income Tax Act that expedites the inter-generational transfer of businesses. Pushed successfully by farm groups and the small business lobby, the Finance Department warned MPs that it would create a tax loophole that would allow high net-worth individuals to engage in "surplus stripping" without paying tax. MPs ignored the warnings. When the bill passed with all-party support, Finance initially said it would delay implementing the legislation but was forced to relent. In delivering the last budget, Finance Minister Chrystia Freeland said the legislation would be replaced, but the department only says it will take next steps "in due course."

The Senate is also pushing ahead with Bill S-210, aimed at limiting access by minors to sexually explicit material online, despite concerns that it would impose broad age verification requirements — possibly using facial recognition software which raises significant privacy concerns. Michael Geist, Canada Chair in Internet and E-Commerce Law at University of Ottawa, says the bill is well-intentioned, but its details seem so "crazy" that some experts probably avoided appearing as witnesses before the Senate because they thought the bill would never get passed. "Are we really going to require Google to impose age verification for someone to conduct a search?" asks Geist, who's convinced the bill will invite a court challenge if it gets passed into law.

"The bill isn't just a slippery slope," he told the Senate committee studying the bill. "It's an avalanche."

What's unusual about all these bills is that major changes in public policy usually originate in government-sponsored legislation, carefully developed by policy experts in the public service after extensive consultation with stakeholders. Then it falls to Department of Justice lawyers with expertise in the legislative matter to draft the legislation. 

Private members' bills, in contrast, are written by individual MPs. Historically, these bills were largely ignored in the parliamentary process. Occasionally, a bill on a motherhood issue like the one brought forward by Senator Jim Munson designating a National Kindness Week would pass into law. Most, however, would die at the end of each session.

"They went nowhere," said John Mark Keyes, who was chief legislative counsel for the federal Department of Justice before retiring and now teaches at the University of Ottawa Law School. "They did nothing. Maybe once every decade, something would happen and that was it."

That's changed, and Mr. Keyes is alarmed that a plethora of private bills are being presented and becoming law without adequate oversight. "If you've got bills that are going forward and are getting passed by the House and the Senate, and they're kind of wonky in terms of the policy, that's a problem."

Keyes dates the change to the government of former Prime Minister Jean Chrétien in the 1990s. Faced with a huge majority of potentially "restive MPs" without enough to do, his government carved out parliamentary time for private members' bills — allocating one hour per week in the Commons. It created a list of 30 private members' bills for each session of Parliament based on a lottery. A lot of horse-trading goes on, and MPs will swap places to get to the top of the list.

Once ignored, these bills now have a real chance of getting passed and with a minority Parliament, even more so. C-228, the pension fund bill, has been presented in different forms since 2004, initially by MPs from the NDP and the Bloc Quebecois, drawing opposition from Liberals and Conservatives. Then the Conservatives, in their more populist guise, changed their approach under former leader, Erin O'Toole, and decided to back the proposal.

According to Keyes, private bills originate in MP's offices and then head to the offices of the law clerk for the House and the Senate. "There typically are not a lot of drafters in these offices, given the number of bills they're drafting. They're drafting well over 100 bills a session." And these drafters are generalists. "They have virtually no legal backup," from the phalanxes of specialist lawyers in constitutional, administrative and tax law scattered throughout federal departments.

"Sometimes, the MPs are getting their policy from lobbyists and the lobbyist says, 'wouldn't it be great to introduce a bill like this?'," he continued. "And staffers in the MP's office don't have any particular policy expertise."              

Keyes cites the example of Bill C-337, presented in 2017 by Rona Ambrose, a Conservative MP, which required judges to take judicial training on sexual assault. According to Keyes, it was well-intentioned but posed serious constitutional problems, including a possible violation of the protection of judicial independence. The issue was finally resolved by making the training the responsibility of the Canadian Judicial Council. The legislation was presented again as a government bill that eventually passed into law.

Senator Peter Harder is alarmed by the private-bill phenomenon. He says changes to core statutes like the Criminal Code and the Income Tax Act should not be done through private bills. "It's a travesty. The Income Tax Act should not be amended through a private member's bill. The Income Tax Act is a very specialized legislative drafting process, and the Department of Finance and Justice are not going to help with what they consider to be inappropriate amendments," he said.

"Having a good bill is not just having the proper legal language. It's having the right policy frame for what they're advocating," he said. "We don't scrutinize our colleagues' bills as critically as we do government legislation. Government legislation is by definition much more rigorous because it has to go through the appropriate bureaucratic challenges on the way through the cabinet system."

The private bills often cover so-called motherhood issues, like protecting pensions or saving the family farm, which parliamentarians are hesitant to oppose. "Who wants to support online porn? I don't," Harder says of Bill S-210. "But I don't want to pass legislation that is unimplementable and flawed in a drafting sense."

Harder doesn't see an easy solution to the problem, but he thinks there are ways for his colleagues to better contribute to public policy. "Rather than have the Senate draft a private member's bill, why not have the Senate do a study on the problem and air the public policy issue . . . By leaping to a bill you're avoiding the policy debate and the challenges it would expose."