Federal conflict rules would have barred energy minister from joining corporation involved in nuclear developments in New Brunswick

Former provincial cabinet minister Mike Holland would have been barred by conflict of interest legislation from joining nuclear energy giant AtkinsRéalis (formerly SNC Lavalin) if he had been in federal politics, an expert in government and corporate ethics has concluded.

Holland, the former New Brunswick Minister of Energy and Natural Resources as well as Ontario Energy Minister Todd Smith both left their positions over the summer and signed on with Montreal-based AtkinsRéalis within a couple of weeks of quitting politics, The Energy Mix reports in an exclusive news story today.

Holland resigned from the government in late June and was appointed as Atkins’ director of business development for North America in early July. He is now a registered federal lobbyist.

Smith quit in mid-August and was hired as vice-president, marketing and business development for Atkins subsidiary Candu Energy two weeks later.

But Democracy Watch’s co-founder Duff Conacher said neither official would have been allowed to make the move if they’d been serving in the federal cabinet.

“At the federal level you wouldn’t be allowed to do what they did,” said Conacher. “There’s a preceding transaction, a negotiation they provided advice on. They were both quoted in AtkinsRéalis’ news release.”

A preceding transaction

In the April 13, 2022 release, Candu Energy and Saint John-based Moltex Energy announced a “strategic partnership to advance the development and deployment of next-generation Small Modular Reactor (SMR) nuclear technology in Canada,” including a “first of a kind” installation in New Brunswick.

In that release, Holland and Smith both showed up as early boosters for the partnership.

“New Brunswick welcomes investment in clean energy, especially as it builds on the province’s established core of expertise in nuclear technology,” Holland said in the release. “This agreement contributes not only to the growth of long-term, high-quality jobs in New Brunswick’s energy sector; it also recognizes the leadership role of both Moltex and the province in advancing the next generation of nuclear technology.”

“I’m thrilled to welcome this new partnership between Moltex and SNC-Lavalin that builds our provincial energy industry, one renowned for its talented work force and strong nuclear supply chain,” Smith added. “This partnership enhances our clean energy advantage and reputation as a global hub for SMR expertise, making Ontario an even more attractive place to do business and create jobs.”

The release cited Candu Energy as a subsidiary of SNC-Lavalin, the politically connected but often deeply troubled global firm that eventually rebranded as AtkinsRéalis in September, 2023. But not before it set up Candu Energy by acquiring key commercial nuclear contracts, intellectual property, and personnel from federally-owned Atomic Energy of Canada Ltd. in 2011.

Holland’s and Smith’s career moves are permitted by New Brunswick’s and Ontario’s conflict of interest rules. Both provinces set 12-month bans on activities like direct lobbying after a former official leaves office, but do not bar other employment with a company that does business with the official’s former government.

‘You’re Never Allowed’

Neither Holland nor Smith would have been allowed to join AtkinsRéalis if they were bound by the federal Conflict of Interest Act, said Democracy Watch’s Conacher.

“You’re never allowed to act on behalf of any person or organization connected with something you were involved with in government. It’s not 12 months. It’s never. You’re never allowed,” Conacher said.

“And then secondly, you’re not allowed to give advice to anyone using confidential information,” he added. That amounts to a blanket restriction because “they learn things every day that are not disclosed,” which means all the advice a former cabinet official gives is based on confidential information.

“How do you unknow what you know and then give advice pretending you don’t know what you know? It’s impossible.”

That concern doesn’t apply in New Brunswick or Ontario, and Conacher said New Brunswick’s conflict of interest rules are the weaker of the two.

Lobbying and other ways to be useful 

In mid-August, Holland was listed in the federal lobbying registry as an AtkinsRéalis senior officer whose lobbying activities represented more than 20% of his duties.

But direct lobbying isn’t the only way, or even the most useful way, a former cabinet minister can help a new corporate employer.

If a provincial ban applies only to lobbying, “you just don’t make the representation,” Conacher explained. “You give strategic advice to the company’s lobbyists on who they should be talking to, who’s the real decision-maker in cabinet, and what you should be saying to make something go through smoothly or get some extra benefit, like a subsidy or a [deadline] extension without any penalty. And that’s why they’re hired—because they have that inside knowledge.”

Although the federal government and every province have some form of ministerial committee on policy and priorities, “it’s hard to tell from the outside who really holds the power in a government, and who’s the real decision-maker on any issue,” he added. “People on the inside know this stuff, and that’s valuable information because you want to lobby the real decision-maker, not the person who’s identified as the decision-maker.”

AtkinsRéalis “delighted” with its new hires

Laurence Myre Leroux, AtkinsRéalis’ manager of external communications and media relations, said the company was “delighted” to welcome Holland and Smith into the fold “given the renewed interest in nuclear power in many jurisdictions,” and that both new hires received guidance from their provincial integrity commissioners before accepting their new gigs.

“While we understand your concerns and the sensitivity of hiring former elected officials, we want to make it clear that we comply with all the rules applicable to this situation, and that we are exercising increased diligence to ensure that guidelines are followed,” Myre Leroux wrote in an email.

Leroux said the company “has implemented a first-class integrity program to promote and facilitate ethical decision-making; this program includes rigorous internal controls designed to reduce or eliminate the risk of real or perceived conflicts of interest.”

The seven-page document deals primarily with disclosures: it states that having a conflict of interest (COI), real or perceived, “does not constitute wrongdoing or a breach to our Code. However, not deliberately disclosing a COI situation is a breach of the Code and of the terms and conditions of employment, which may lead to disciplinary measures.”

Based on that procedure, Myre Leroux said, “our Integrity team carried out a full analysis of Mr. Holland’s file and Mr. Smith’s file prior to their hiring.”

Mitchell Beer is publisher of The Energy Mix, which published an exclusive earlier version of this story on September 12, 2024.