House Committee Calls Ethics Commissioner to Testify on Green Fund Violations

The Canadian flag blows on the Peace Tower on Parliament Hill in Ottawa on June 28, 2024. The Canadian Press/Sean Kilpatrick

The Industry and Technology Committee has voted to call the ethics commissioner to testify on his report on conflict-of-interest rule violations connected with Ottawa’s now-defunct federal green fund.

“We are seeking a meeting with the ethics commissioner to discuss his findings, and we need to do that quickly because the transition is ongoing of this fund to the [National Research Council] right now,” Conservative MP Rick Perkins said at the committee meeting on July 31.

He was referring to the findings of the commissioner’s investigation into former chair Annette Verschuren of Sustainable Development Technology Canada (SDTC).

When Parliament resumes in September, the committee will hear from Ethics Commissioner Konrad von Finckenstein for one hour and Verschuren for two hours.

The committee’s vote came a week after the ethics commissioner released a report finding that Verschuren failed to recuse herself from decisions that benefited organizations she had ties to.

While serving as chair of the SDTC board, Verschuren continued serving on the boards of the Verschuren Centre for Sustainability in Energy and the Environment, which she founded, and the MaRS Discovery District. She also remained chair, CEO, and majority shareholder of NRStor Inc., a company she founded.

Last year, following complaints that she had approved money for NRStor, Verschuren told the committee that a legal professional she consulted had cleared the move, as she had previously declared a potential conflict to the board and the money was a blanket COVID-19 relief payment to all SDTC portfolio companies. She resigned on Dec. 1, 2023.

In early June, a report by Auditor General Karen Hogan found some 90 conflict-of-interest rule breaches related to SDTC, with money being given to dozens of ineligible projects.

Hogan said her office found “significant lapses” in the governance and stewardship of taxpayers’ funds at SDTC. Out of 58 projects her office examined, 10 projects received a total of $59 million despite being ineligible. Of the remaining 168 start-up and scale-up projects approved during the audit period, from March 1, 2017, to Dec. 31, 2023, an estimated 16 were ineligible.

The auditor general found that 63 of the 90 conflict-of-interest violations were related to two COVID-19 relief payments that Verschuren approved for her own company NRStor, in 2020 and 2021.

Hogan said those payments also violated the government contribution agreement, which does not allow blanket payments and instead “requires that each individual contract and payment be looked at on a merit basis and awarded to a specific project.”

Following release of Hogan’s report, the government announced that the SDTC would be disbanded and all programs under it would be transferred to the National Research Council.

Industry Minister François-Philippe Champagne said in a June 4 statement that the auditor general’s review had “revealed serious weaknesses in SDTC’s governance.”

Disagreement Over When to Meet

During the Industry and Technology Committee meeting on July 31, Liberal MP Pam Damoff said there was no disagreement that Verschuren had behaved improperly.

“This was someone who had a history going back to the Harper years of being appointed to boards and advisory committees, and I pointed out to her that even if she got advice to the contrary, she should have known better and should have recused herself,” Damoff said.

Much of the meeting was spent debating a sub-amendment to the main motion, which called for the ethics commissioner to testify as soon as Parliament returns in September instead of within a month.

Conservative MP Michael Cooper said that given the importance of the ethics commissioner’s report, there was “no reason” why the committee should wait nearly two months to hear from him. He also said the auditor general had identified 20 additional conflicts, valued at nearly $2.6 million, where Verschuren voted in favour of motions that resulted in money being given to companies she had a stake in.

“It underscores why we need to hear from Ms. Verschuren sooner rather than later. She needs to come before committee and she needs to address these 20 additional conflicts, and then based upon her testimony, additional steps can be taken, including referring the matter to the ethics commissioner to undertake a further investigation,” he said.

NDP MP Brian Masse said Conservatives on the committee had filibustered on various issues during the last sitting of Parliament, which had delayed the committee from discussing the SDTC. He also said that even if the committee met within a month to discuss the issue, there is “very little that we can do until the House resumes.”

Conservative MP Larry Brock said the SDTC scandal went to the “core of good governance” and that MPs on the committee could investigate it before Parliament resumes. “We can walk and chew gum at the same time. We can fulfill our obligations on this committee to ensure that taxpayers are receiving good value for their money,” he said.

The sub-amendment for the committee to meet when Parliament resumes in September ultimately passed despite the Conservatives voting “no,” and the subsequent amendment passed unanimously.