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Stop the privatization of MOECC inspections

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An analysis of Bill 151, the Waste-Free Ontario Act, 2016

Bill 151: Purpose

Bill 151, the Waste-Free Ontario Act, 2016, is an omnibus bill that would enact two acts – the Resource Recovery and Circular Economy Act, 2016 and the Waste Diversion Transition Act, 2016 –and replace the existing programs operated under the Waste Diversion Act, 2002, which would be repealed.

Resource Recovery and Circular Economy Act, 2016

This act would:

  • establish an overarching provincial interest in resource recovery and waste reduction and enable the government to issue policy statements to support this interest;
  • authorize policies that advance the provincial interest and require provincial ministries, municipalities, producers and others with obligations under the specified acts to perform in a manner that is consistent with those in the policy;
  • make producers accountable in full for recovering resources and reducing waste associated with their products and packaging so that producers and anyone else involved with reducing, reusing and recycling would need to register, report, promote and encourage public participation in recycling activities; and
  • overhaul Waste Diversion Ontario, the oversight body currently overseeing waste diversion programs, and convert it into a new Resource Productivity and Recovery Authority, with new powers, compliance and enforcement tools, and enhanced oversight and accountability.

Waste Diversion Transition Act, 2016

This act allows the existing waste diversion program to be transitioned into the new producer responsibility model. This would ensure that access to existing recycling services is not disrupted.

Key issue: Privatization

OPSEU’s chief concerns with Bill 151 are the provisions that provide for private inspectors to be hired by the new Authority.

As background, the Waste Diversion Act, 2002 clearly set forth that Crown-employed provincial officers would be responsible for investigations and prosecutions of any violations of the Waste Diversion Act. The new Resource Recovery and Circular Economy Act in Bill 151 contains the same provisions as the Waste Diversion Act related to Crown-employed provincial officers; however, the act includes new provisions allowing the Authority to hire private inspectors who are not Crown employees.

OPSEU strenuously disagrees with this provision.

Key issue: Accountability

As a general overview, the Waste Diversion Act and the Resource Recovery and Circular Economy Act primarily deal with ensuring that municipal hazardous waste, waste electronics, waste oil and blue box recycling materials are dealt with properly.

Waste Diversion Ontario is a private entity that is currently responsible for these programs under the Waste Diversion Act. Its main objective is to ensure that industry pays for these programs.

The government has determined that the Waste Diversion Act lacks the ability to undertake compliance inspections to ensure that the regulated community complies with requirements of the Waste Diversion Act. The current act does not have provisions for inspectors to do inspections. With Bill 151, the government has proposed that inspectors undertake compliance inspections. The bill sets up an inspection regime similar to the current model of the Technical Standards and Safety Authority (TSSA) and the Electrical Safety Authority. This private inspection approach has been criticized, notably in regard to the Sunrise propane event.

Currently, MOECC inspections and investigations/prosecutions are two separate duties. However, both duties are carried out by formally educated, well-trained, professional Crown employees. Generally speaking, if MOECC inspectors find significant violations, or they are unable to bring a client into compliance, that matter will be reviewed by MOECC investigators to determine whether the client should be prosecuted.

Under Bill 151, private inspectors who are not Crown employees will do what is now the job of Crown-employed inspectors, but investigations/prosecutions will continue to be done by Crown-employed investigators.

OPSEU does not believe this is a practical, reasonable or cost-effective approach.

Currently, some 400 MOECC Crown employees are responsible for inspections that deal with municipal hazardous waste, waste electronics, waste oil and blue box recycling materials. OPSEU does not believe that a new private inspector’s regime is necessary to ensure compliance with these programs. MOECC Crown-employed inspectors have a strong track record of ensuring compliance with these programs. These inspectors have a strong understanding of the diverse client group and are well suited to ensuring that clients comply with Bill 151.

OPSEU supports extended producer responsibility. However, we also believe that the programs associated with Bill 151 should be undertaken by Crown employees – not a private board of directors and private inspectors. OPSEU believes that Bill 151 should transition the provisions of the Waste Free Ontario Act to the responsibility of MOECC as an expansion of the Waste Diversion Act.

OPSEU has reviewed other organizations’ comments on Bill 151. The Canadian Environmental Law Association (CELA) and its allies echo OPSEU’s observations. CELA strongly suggests that the functions of the proposed Authority be returned to MOECC’s care and control. If Bill 151 were rewritten in the manner specified by CELA, the bill would better protect the public health, public money and the environment.

In defence of keeping inspections public, CELA states:

  • “Any delegation of enforcement powers from the Ministry (which has the necessary resources, mandate and experience) to a third-party entity (which has none) will seriously threaten the administration of justice in Ontario;
  • there is no evidence to substantiate the apparent belief that transferring enforcement powers from the Ministry to a third-party entity will necessarily result in more timely or effective enforcement of environmental law;
  • to the contrary, evidence arising from the track record of the Technical Standards and Safety Authority (which assumed compliance/enforcement powers from the Ministry of Government Services) has been troubling and problematic, as confirmed by the provincial Auditor General and other commentators;
  • transferring enforcement powers to a third-party entity raises concerns about independence, credibility and fairness, particularly if the entity is being expected to conduct prosecutions against its contacts within the regulated sectors; and
  • law enforcement is a core government function that should remain within government itself for accountability purposes.”

Key issue: rationale for privatization

OPSEU strongly supports a rewritten Bill 151 that transitions the provisions of the Waste Free Ontario Act to the responsibility of MOECC.

The government has clearly demonstrated in Bill 151 that it wishes to have significant involvement in the new Authority. For example, the ministry will retain control of policy and enforcement through the Investigations and Enforcement Branch. However, the ministry will give compliance (inspection) abilities to the private sector through the bill.

OPSEU does not support the erosion of public services by allowing a private agency to appoint inspectors. Inspectors employed by MOECC are highly educated, trained, experienced and qualified individuals who take their responsibilities to the public and the Crown very seriously. Private inspectors will not be instilled with the same sense of responsibility, and the public interest will not be served by using private inspectors.

OPSEU’s position paper Justice: Not for sale sets out how incentives differ for public versus private officers in the field of civil enforcement. Public enforcement officers are trained professionals who perform their duties under careful oversight. They are also Ontario Public Service employees who are keenly aware of their duty to protect the public. Because profit is not their concern – this is the only motive for private inspectors – public enforcement officers perform their job without bias.

The government has so far been silent on why the inspectors are to be privatized. One may speculate that the government believes provincial officers “do not need” to do this work, perhaps characterizing it as administrative: Inspectors may only deal with paperwork and collecting money, rather than compliance items that could have an adverse effect on public health or the natural environment.

In fact, much of the work that provincial officers do now is administrative. There is very little difference between the work proposed in the bill and the current workload of a provincial officer. MOECC Crown‑employed inspectors are well suited to ensuring compliance with the provisions of Bill 151. They could seamlessly add this new work to their current duties.

One may conclude that the reason the government wants to privatize inspectors is because private interests want it that way. They would profit from fees charged to the public purse for relatively quick and inexpensive inspections, while Crown employees would retain the lengthy and expensive task of prosecuting violators.

With Bill 151, the government may be showing its true colours. It talks tough and pretends it is protecting the public interest. However, it shields itself from complaints and Freedom of Information requests, lets industry self‑regulate, and allows a private entity to donate money collected through fees to the Liberal Party. Further, the government would be able to reward its benefactors and allies by appoint them to the Authority’s board of directors.

Conclusion

Bill 151 fails to live up to the current public interest standards of Ontario’s strong environmental legislation. The bill does not meet the high expectations of the people of Ontario because it:

  • privatizes inspections
  • excludes the Authority from the Freedom of Information and Protection of Privacy Act
  • fails to hold directors of corporations accountable
  • allows industry to self-regulate
  • taxes the public through cost recovery

OPSEU agrees with the polluter-pay principle. For example, if a company causes a spill, the polluter, not the public, should bear the cost of cleaning it up.

However, under Bill 151, the Authority will set its own fees. The fee will take into consideration three revenue demands:

  1. the cost of running the Authority itself (which would likely be much less, were its operations carried out within the ministry)
  2. the cost of running its programs
  3. extra revenue requested by the government

Bill 151 allows the government to request a certain amount of revenue yearly, which could be above and beyond what the Authority needs to carry out its operations.

Industry will need to work into its costing model the fees charged by the Authority. The extra cost will be passed on to the consumer. In effect, the consumer will be paying an added tax to the government through the higher price it pays for products and services it purchases.

The government should consider other models of cost recovery and use qualified MOECC inspectors to perform the bill’s inspection functions. It needs to rewrite Bill 151 and continue the tradition of strong, publicly enforced environmental legislation in Ontario.

Appendix 1: Problems associated with privatization

Problems with a two-tier system

  • The government is essentially creating a two-tier MOECC inspection regime, where public environmental officers and private environment inspectors will conduct the same work.
  • This may present legal problems when there is a disagreement between a private inspector and a provincial officer, as has occurred with Waste Diversion Ontario (WDO). For example, one provincial officer relates that, during an inspection, he tried to ensure compliance with Ontario Regulation 347 waste classes. The client indicated that an industry funding organization had provided contrary direction to the client.
  • This could be confusing for industry and municipalities.

Possible conflict of interest

  • Private inspectors will be funded by private industry.
  • How will they be able to remain objective in the performance of their duties?

The private sector has wasted money

  • WDO and its industry funding organizations (IFOs) have failed to properly manage taxpayers’ money. One need only look at the eco fees scandal, where consumers were charged a separate tax that was often above the actual cost to recycle the product purchases. One may also look at the expenses scandal at Ontario Tire Stewardship, an IFO of the WDO.
  • It makes no sense to give these organizations more powers to control taxpayers’ money.

Possible privatization expansion

  • For OPSEU, it appears that no current bargaining unit jobs are at risk, and that the new organization will not assume any current ministry programs.
  • OPSEU remains concerned about the precedent of having privatized inspectors in MOECC.
  • It is likely that clients of MOECC will support the privatized inspector model and lobby the government to privatize more of MOECC’s inspection work. This is because the salaries of the inspectors will essentially be paid by the regulated community that they are inspecting. Once industry sees there is the possibility of a private inspection program – with less scrutiny and oversight – they are likely to lobby the government for more privatized inspectors. Other publicly run programs could then be more easily be privatized.
  • Other elements of provincial officers’ work that could be privatized include inspection of:
    • landfills
    • waste transfer stations
    • hazardous waste depots
    • generators of hazardous waste
    • haulers of waste
  • Inspection of waste audits and waste reduction plans, packaging audits and packaging work plans, recycling facilities, and other clients to ensure they are actually recycling. It is important to note that it appears that these types of inspections will be given in whole or in part to the new private inspectors.
  • This is the first example of privatized environmental inspections in the Province of Ontario. It needs to be stopped. 

Private sector expansion erodes public services

  • With this bill, the government is trying to avoid problems associated with WDO and the IFOs.
  • It is unlikely that strengthening and expanding these organizations will result in better public services.
  • The government takes pride in the quality of its public service.
  • Expanding these organizations and allowing more private inspectors will erode public services and public confidence.

Appendix 2: OPSEU commentary/recommendations on Bill 151

OPSEU proposes that many sections of Bill 151 be reworked to be similar to the Environmental Protection Act (EPA).

The EPA’s core values are protecting human health and the natural environment. It includes strong provisions to enforce these values. It provides for provincial officers with all of the powers, responsibilities and attributes necessary to ensure the public is served in good faith. The EPA also protects provincial officers and their directors from political influence to act to protect human health and the natural environment.

Examples and commentary are provided below.

Reworking Bill 151 to mirror the EPA would strengthen the public interest, better protect the environment, and remove privatization provisions.

Bill 151, An Act to enact the Resource Recovery and Circular Economy Act, 2015 and the Waste Diversion Transition Act, 2015 and to repeal the Waste Diversion Act, 2002

 

Section 1, “definitions”

Add: “Provincial Officer” means a person who is designated by the Minister as a provincial officer for the purposes of this act and the regulations; (“agent provincial”)

Section 10: “regard for provincial interests”

Comment: Section 10 primarily appears to deal with privatized employees of the Authority and inspectors appointed by the Authority. Section 10 would not be necessary if MOECC staff were responsible for implementing the act.

Section 11: “policy statements”

Comment: Section 11 makes clear that MOECC plans to set and control the Authority’s policy. This is a typical government approach to legislation. However with this act, MOECC employees will not be responsible for implementing government policy.

Section 12: “consistency with policy statements”

Comment: Section 12 primarily appears to deal with privatized employees of the Authority and inspectors appointed by the Authority. This section would not be necessary if MOECC staff were responsible for implementation of the act.

Section 13: “application and exceptions – geographic areas”

Comment: Section 13 is of concern, because it is not typical that policy be set for different areas of the province, although some exceptions exist in the environmental legislation for activities in northern Ontario. The public interest is served by having a clear, consistent legislative framework throughout Ontario. This creates an even playing field and consistency for business. If there are inspections and enforcement measures under the act, they must be delivered in a fair and equitable manner across Ontario.

Subsection 14(5): “prescribed instruments”

Comment: Subsection 14(5) may have implications for the ministry’s Approvals Branch. An instrument likely includes an Environmental Compliance Approval or other government-issued instruments. Depending on the policy, Environmental Compliance Approvals issued by MOECC may need to be amended, and future Environmental Compliance Approvals may contain provisions to ensure compliance with the act. This effectively means that the MOECC Approvals Branch staff will be involved with ensuring compliance with the act and may take direction from the privatized Authority. While the government may be setting the policy of the Authority, it is clear that the Authority will be responsible for implementing the policy.

Section 15: “conflicts”

Comment: Section 15 should be clarified. An instrument is typically a legal document setting out compliance standards. The concern is that a policy may take precedent over a legally binding document. This should not be allowed to occur. This has the potential to create situations where Provincial Officers employed by the government are trying to enforce a requirement of an instrument, but are prevented from doing so by a policy statement.

Section 16: “appointment of directors”

Comment: Section 16 is of concern, because it states that the minister can limit the powers of the directors as he sees fit. This has the potential to cause many problems. Section 16 should mirror the relevant section in the EPA (see below). Directors are currently delegated responsibilities for certain sections of a certain act and are given sole responsibility to exercise their authority, free from political interference. Section 12 allows the minister to “adjust” the director’s authority to suit a political agenda.

From the EPA:

5. (1) The Minister may in writing appoint as Directors any of the following persons as the Minister considers necessary in respect of the sections of this act or of the regulations that are set out in the appointments:

1. Public servants employed under Part III of the Public Service of Ontario Act, 2006 who work in the Ministry or the members of classes of such public servants.

2. Subject to the approval of the Lieutenant Governor in Council, any other persons or the members of any other classes of persons.  2006, c. 35, Sched. C, s. 36 (1).

Section 17: “reviews”

Comment: It is of concern that section 17 appears to give directors authority to oversee privatized entities’ employees, similar to the current bureaucratic process. The director should be overseeing public servants – not private employees.

Section 20: “minister’s declaration”

Comment: Section 20 may allow the minister political interference in matters related to the public interest. Section 20 does not appear to be consistent with other pieces of legislation. Public servants must be allowed to operate without political interference.

RESOURCE PRODUCTIVITY AND RECOVERY AUTHORITY

Comment: The following sections provide for the privatization of public services. This work should be undertaken by the Ontario Public Service.

Section 37: “not Crown agents”

Comment: Section 37 is not required, because the Authority and its members, officers, employees and agents should be agents of the Crown.

Section 40: “contribution to defray costs”

Comment: The sections below allow the Authority to recover costs. Section 40 allows the government to charge the Authority whatever it sees fit to recover costs. This appears to be a further pay-for-service and a tax, because, ultimately, the public will pay these costs. What the government may charge the Authority needs to be flushed out further. Is the government going to charge the Authority costs if the government undertakes a prosecution under the act? If this is the case the Authority may not wish to incur this cost and, therefore, not lay charges. This may affect how the public interest is served. If the government is using the polluter-pay principle, there are other options for implementing this act using public servants.

Subsection 41(4): “establishment and publication of fees, etc.”

Comment: If the Authority is not a Crown agency, why does it need to do public consultation? The government may want to give the illusion that the public interest is being served, without having to be responsible for the actual fee being charged. The government should take ownership of this program. The fees that a government-run program would charge would likely be substantially less than the fees a top‑heavy, private, bureaucratic Authority would charge.

Sections 45-49: “registrar”

Comment: Sections 45 to 49 should mirror the EPA, sections 3, 4 and 5. The following sections provide for the privatization of inspection services. Other provisions, such as posting of orders, should be a public function. Clearly, while the government does not want to be involved in setting fees for the public, it wants the Authority to act as a public agency.

Section 47: “inspectors”

Comment: A private agency must not be allowed to appoint inspectors. Inspectors employed by MOECC are highly educated, trained, experienced and qualified. They take their responsibilities to the public and the Crown very seriously. Private inspectors will not be instilled with the same sense of responsibility. The public interest will not be served by using private inspectors. The government has clearly demonstrated in this act that they wish to have significant involvement in the implementation of its provisions. However, by not using public servants as inspectors, they show they are not actually interested in the public interest. One may conclude that the government does not wish to bear the costs associated with inspectors. The government should consider other models of cost recovery and use qualified MOECC inspectors to perform the inspection functions of this act.

Section 54 “administrator”

Comment: Section 54 would not be necessary if the programs specified in the act were run by the Ontario Public Service.

Subsection 54(10): “minister’s directions”

Comment: Subsection 54(10) potentially allows the minister to interfere politically with the board.

Section 56: “right to use French”

Comment: It is unclear if this language is consistent with the government’s policy on French-language services. Section 56 provides an exemption if the Authority does not wish to provide services in French.

Section 57: “confidentiality of information”

Comment: Section 57 appears to allow the Authority’s private inspectors to communicate with a public MOECC inspector. Section 57 appears to suggest that inspectors employed by MOECC may be called upon to help during an inspection. Section 57 suggests that prosecutions of violations of the act will be completed by MOECC staff. Why is the government not allowing the Authority to conduct investigations and undertake prosecutions?

It is unclear why “provincial offences officers” are included in clause 57(3)(d). It is clear that the inspectors appointed under this act are not peace officers or provincial offences officers or Crown agents. It is likely they are included because provincial offences officers employed by MOECC/the Crown could be somehow used by the Authority. It is of concern, because a situation could occur where the Authority is providing direction to Crown employees to do work. We have already seen that political pressures could be brought to bear on the Authority, and that public employees could be forced to undertake work not necessarily in keeping with the public interest. In addition, the Authority will be fraught with private sector influence, which could further cloud the judgement of the Authority. In effect, industry could essentially be in a position to direct Crown employees.

Subsection 57(4): “testimony in civil proceeding”

Comment: This is similar to protection for public inspectors. The government should not be extending this provision to private employees, who are not agents of the Crown.

Section 76: “definitions”

Comment: Section 76 should mirror Part XV (sections 156 to 168) of the EPA.

Section 78: “inspection”

Comment: The inspection of waste disposal sites and waste management systems under this provision clearly rests with MOECC provincial officers designated under the EPA. Section 76 creates a situation where an owner of a waste disposal site and waste management system is regulated by MOECC through two different types of inspectors. This creates an unnecessary overlap in inspection services and wastes taxpayers’ money. Currently, when MOECC provincial officers conduct inspections of such facilities, they are assessing compliance with multiple pieces of legislation with which site owners must comply. Many of the provisions are administrative in nature, similar to the provisions set forth in this act. Current MOECC inspectors could easily conduct inspections under the act during the course of their normal inspections. Having two different inspectors also increases the risk of officially induced errors stemming from inaccurate advice given by private inspectors who do not fully understand all of the environment legislation applicable to these sites.

Subsection 85(2): “application of Provincial Offences Act”

Comment: It is unclear whether it is legally possible for a private inspector who is not a “provincial offences officer” to be compelled to comply with the Provincial Offences Act, as stated in subsection 85(2).

Sections 86 and following: “compliance orders”

Comment: The order provisions set out below are basically the same as other pieces of environmental legislation.

Section 87: “deputy registrar”

Comment: The deputy registrar is clearly fulfilling the traditional role of director under other pieces of environmental legislation. However, the deputy registrar does not have to keep in mind the public interest, as does a member of the Ontario Public Service.

Section 90: “failure to pay administrative penalty when required”

Comment: It is of concern that a private organization can use the public court system to enforce the collection of funds owed as a result of administrative penalties.

Section 97: “appeals from tribunal”

Comment: It is of concern that the private Authority will have access to a public review tribunal system.

Section 98: “offences”

Comment: It is clear that MOECC is regulating the Authority. It the provisions of the act were performed by the Ontario Public Service, there would be no need for these offence sections.

Subsection 98(12): “limitation”

Comment: Who is the “provincial offences officer” this section references? It is likely an MOECC provincial offences officer performing an investigation and/or prosecution on behalf of the Authority. It is of concern that a private Authority will have access to Crown employees to undertake enforcement on their behalf.

Section 99: “obstruction, etc.”

Comment: Section 99 clearly sets out that MOECC public servants will be involved in implementing the act.

Section 100: “serving a document”

Comment: This is not a typical provision in other laws concerning the serving of documents. It may not be legally possible to serve minors with documents under this act. Generally, these service provisions lower the standards for document service set out in other environmental legislation, essentially creating two separate document service delivery standards. If the government was intent on ensuring the public interest was served, they would include the standard document service provisions.

Waste Diversion Transition Act, 2015

General comments on the Waste Diversion Transition Act: This act should be transitioning the provisions under the Waste Diversion Act back to the responsibility of MOECC.

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