Updated: Governor Carney's vacation stay with Liberal critic not a conflict, BoC says

OTTAWA – The Bank of Canada tried to quell questions about its governor’s impartiality and judgment Monday, saying Mark Carney was not afoul of conflict rules by vacationing in the summer at the cottage of the Liberal finance critic.

The central bank confirmed a weekend report that Carney stayed at Scott Brison’s Nova Scotia cottage while key members of the Liberal party were courting him for the leadership.

Spokesman Jeremy Harrison said there was nothing improper in the visit, and that bank duties were not discussed.

“The Bank of Canada’s general counsel, who is responsible for enforcing the bank’s conflict of interest policy, has assessed that this visit does not breach the bank’s conflict of interest guidelines in any way,” Harrison said.

“Neither the Bank of Canada, nor governor Carney, have an actual or potential commercial or business relationship with Mr. Brison.”

Harrison added that Carney and Brison had been friends for about a decade and that the visit to the MP’s cottage at Cheverie, N.S., cannot “be defined as partisan or political activity.”

Brison confirmed the friendship, which began in 2004 when Carney was an associate deputy minister at Finance and the Nova Scotia MP was the Liberal public works minister, but refused to elaborate about the visit.

“We entertain friends often at our Cheverie home. It is not our intention to publicly discuss personal time with friends in our private space,” he said.

Carney is used to being courted, most successfully by the finance minister of Great Britain, who has convinced him to become the next governor of the Bank of England in July.

But the report that Carney had been sought out for the Liberal leadership — particularly the suggestion he did not immediately shut down the entreaties — has placed him and the bank in a murky area of ethics, causing some to review his past speeches and policy decisions for signs of taint.

Desjardins Capital Markets economist Jimmy Jean noted the “chatter,” but called “reckless” one assertion that the central bank might have “intentionally kept monetary policy too restrictive (recently) such as to tarnish the Conservative party’s economic track record.”

Finance Minister Jim Flaherty, who appointed Carney to the job in 2008, shut down any questions on the issue when asked both Sunday night and Monday.

“I have no comment on any of that, and I usually have comments on everything,” he said.

Several Bay Street economists, who asked not to be quoted, said they saw no evidence that Carney had conducted monetary policy in any way other than impartially.

Carney has acknowledged in the past to being approached by Liberals for the job, but maintained he was not interested, at one time jokingly responding: “Why not become a circus clown?”

In the Globe and Mail article, Carney said he had been approached by “different people, different parties.”

The article quotes Carney as saying that he never sought the job and did nothing to encourage suitors.

“Nobody did anything on my behalf. I never asked anybody to do anything. I never made an outgoing phone call. I never encouraged anybody to do anything.”

Liberal MP John McCallum, also a former finance critic and private sector economist, said he had a short conversation with Carney in August because he had heard the speculation, which he said he found “unusual.”

He Carney neither confirmed or denied interest.

“I wasn’t lobbying, I just casually mentioned it.”

The Bank of Canada’s conflict-of-interest policy cautions against the “appearance of impropriety,” and says employees offered hospitality or other benefits should ask themselves: “Does it feel right?”

Other questions to be considered: “Is there a chance that this could reflect negatively on me or on the Bank? What would a reasonable person think about my actions? Would I be embarrassed if others knew I took this action?”

The policy does not ban outside political activity. “Employees are not excluded from participating in political activities as long as their actions are not likely to be interpreted by the public as being representative of Bank policy.”

Carney, who briefed finance ministers on the state of the economy at a federal-provincial meeting at Meech Lake, Que., on Monday, left the meeting without taking questions from reporters.

Looking for more?

Get the Best of Maclean's sent straight to your inbox. Sign up for news, commentary and analysis.