The board of directors for the Social Security Board was mostly empty for about five months in early 2020, but leaders couldn’t offer a clear explanation for that fact last week while responding to criticisms about a lack of transparency in appointing candidates to statutory boards under the purview of the Ministry of Natural Resources, Labour and Immigration.
NRLI Acting Permanent Secretary Joseph Smith-Abbott, who assumed the role in May, said during a Commission of Inquiry hearing on Sept. 8 that his ministry fell short of certain transparency standards in appointing members to two of the statutory bodies it oversees: the SSB and the National Parks Trust.
He also answered questions about how candidates are selected, especially after the current government announced a new “policy” of replacing board members after a new administration comes to power.
In hearings with Mr. Smith-Abbott and NRLI Minister Vincent Wheatley the same day, the commission only briefly mentioned the two other bodies that fall under the NRLI ministry: the Immigration Board and the temporarily suspended Land Survey Board, which doesn’t have the necessary members to function.
Social Security Board
The SSB board of directors is governed by the Social Security Ordinance, which was amended in 2014 to increase the number of board members from seven to nine. The law mandates that Cabinet must approve candidates before a minister can appoint them, COI Counsel Bilal Rawat said during Mr. Smith-Abbott’s hearing.
The law requires the board to include two members each to represent employers and employees, as well as the chief medical officer, two other government representatives, and the SSB’s director and deputy director, he read from the law.
In response to questions from Mr. Rawat, Mr. Smith-Abbott said he couldn’t find any evidence of how employer representatives were selected in the past. The law says that they can only be appointed after consultation with other employers or associations to make sure they generally represent people throughout the territory.
“The common practice would have been that there would have been informal conversations with any myriad of interests, stakeholders, that perhaps may lead to the selection of individuals for the office, or for the membership and to a board,” he said. “But again, I cannot say with certainty that these consultations would have taken place.”
As for the future of the ministry’s oversight of these boards, Mr. Smith-Abbott said, “There’s evolution and development in thinking about what constitutes an appropriate governance framework for the selection, the consideration of board members.”
Citing a document in a bundle provided to Mr. Smith-Abbott, Mr. Rawat asked for confirmation that the board of the SSB only had three members — the chief medical officer, the director and the chairman — between the end of 2019 and May 2020.
Mr. Smith-Abbott answered in the affirmative.
The other members’ terms had expired, Mr. Rawat noted. But considering that only three of nine positions were filled, he then asked if the board was actually functioning at the time.
Mr. Smith-Abbott responded, “I cannot say to the degree to which the board may or may not have been active. I don’t know that.”
When it came to filling those positions at the beginning of 2020, Mr. Smith-Abbott said he couldn’t provide any records of how the qualifications of the new board members were assessed, or how any potential conflicts of interest may have been determined.
The vacancies were filled in May by Tasha Bertie, Derek Marshall, Lyra George, Dr. Mitchell Penn, Maya Barry and Patsy Lake, Mr. Rawat read from Cabinet records. Ms. Lake was appointed deputy chairwoman through an expedited contract.
Mr. Smith-Abbott said he couldn’t find a record of how the minister selected the members.
The chairperson position has been vacant since the recent expiration of Ian Smith’s appointment, but government advertised the position on Sept. 9, requesting applications by Sept. 21.
The COI also gave Mr. Smith-Abbott a chance to respond to a range of “potential criticisms” that were raised in the inquiry, mainly concerning the appointment of the SSB board members in May 2020.
They centred around various provisions that the COI said are lacking: public advertising of board vacancies; profiles detailing each member’s competency; an “independent or transparent process by which a suitable pool of candidates are identified;” transparency in how members were selected; formal interviews of candidates; and “due diligence carried out in respect of any of the proposed appointees.”
After Mr. Rawat read these concerns, Mr. Smith-Abbott agreed that they were all valid.
However, he argued that an absence of written guidelines doesn’t mean the ministry’s appointment process is lax.
“I really do not believe, in all honesty, that over the decades of appointing members to various boards, that it would be a fair statement to say that no effort was made to identify and select,” Mr. Smith-Abbott said, adding, “A lot of thought is given, I would say, to the notion of who are the people who should serve on these boards. We look very critically at the contribution that those individuals make within society, their participation in civil society, their stature within the community, what contributions, what educational background, depending on the type of boards.”
Sir Gary responded, “Given that there was no advertisement and so on, which necessarily will exclude some people, because they won’t know that the posts are available, how can we say that an effort was made to identify and select the most suitable and the most qualified candidates for membership? There may be candidates out there about whom you know nothing.”
Mr. Smith-Abbott answered that the selection process is still evolving since a major push for reform in 2006, which received a boost when the Climate Change Trust Fund Act passed in 2015.
He added, “But to the point of being the most qualified, no, I cannot certify that they are the most qualified, because we would not necessarily know the full scope and range.”
Mr. Rawat said another potential criticism alleged that the familial relationships of some candidates and Cabinet members was not properly recorded, and “on at least one occasion, the relevant Cabinet member did not excuse himself when the nomination was being considered.”
He said this failure to recuse applied both in early 2020 with the board appointments and with the selection of Jeanette Scatliffe-Boynes as the acting SSB director.
However, Mr. Smith-Abbott argued that anyone who needed to know about potential conflicts was already aware.
Mr. Rawat made the point that without a written trail to audit for the selection process, it’s not possible for the government to show if potential conflicts of interest were even flagged.
The COI also asked Mr. Smith-Abbott about the NPT board, which oversees the management of the territory’ 21 protected areas.
Mr. Rawat said that according to the National Parks Trust Act of 2006 and amending legislation, it is up to the relevant minister to fill “periodic” vacancies.
On Nov. 29, he said, the ministry appointed eight members for varying lengths of time.
The law states that it’s up to the minister to stagger the appointments, a requirement that Mr. Smith-Abbott said helps with ensuring that important institutional knowledge is passed from senior to newer members.
He confirmed that according to the law, the minister doesn’t need Cabinet approval for appointments, and that there is no requirement to advertise when a position is open. Instead, other sources, including members of government, can make informal recommendations.
While other bodies like the Climate Change Trust Fund — which used to fall under the NRLI but was moved to the Premier’s Office in 2019 — have “transparent” mechanisms for filling vacancies written into their governing legislation, the NPT doesn’t, he said.
Mr. Rawat asked, “Without being critical, that process gives you a small pool of people because you’re not expanding it through advertising and going out to the public, but you collect a small pool of names, and that pool of names could reduce a little more if people don’t want to serve when approached?”
“That is correct,” Mr. Smith-Abbott answered.
Later the same day, the commission called the NRLI minister and asked similar questions.
During the hearing, Mr. Wheatley defended the “policy” of widespread board replacements that the government adopted shortly after the 2019 election.
“We came in with a transformative aggressive agenda, and we felt the best thing to do is to find persons who align with our ambitions,” Mr. Wheatley said.
Sir Gary questioned why keeping the already-appointed members would be a problem considering that statutory boards are meant to be autonomous from the government.
“Let’s put it very colloquially,” he said, “and I don’t mean to be disrespectful, but you wanted to put your own men and women into these boards to pursue your—”
Mr. Wheatley interrupted, “No, I can’t agree with that at all because not all boards change all members. … I can’t think of any single board that changed every single member. We’re saying we want the option to be able to do it.”
Mr. Rawat asked if the underlying goal of the policy was to prevent ministers from ending up with boards that “frustrated your mandate.”
“I think every minister would have that concern,” Mr. Wheatley replied.
Sir Gary asked if the expectation that appointees commit to fulfilling a current administration’s mandate, as determined by the relevant minister, makes for “overtly political appointments.”
Mr. Wheatley conceded that the selection process may need review. But he said leaders have to select board members somehow, and he argued that the new policy gives an administration the flexibility to pick who it sees fit.
Mr. Rawat also asked Mr. Wheatley about the gap in board members serving on the SSB.
The minister responded that he didn’t know what happened to the board between the end of 2019 and May 2020, considering that he inherited the board upon assuming office.
He added that he didn’t attend to the boards under his ministry until April 2020. He remembered getting a briefing on the board when he took office, but he didn’t recall ever learning a reason for the dwindling numbers.
“My first priority was to get the board functioning,” he said. “There were some programmes we had to get moving, and we need the board functioning to make certain decisions.”
One of the biggest decisions SSB made in 2020 was designating a $40 million grant for pandemic relief efforts, which was announced about a month after the new board was appointed.
Given a chance to respond to “potential criticisms” that the board appointment process lacks transparency, Mr. Wheatley echoed Mr. Smith-Abbott, arguing that the ministry did carry out adequate “informal” reviews.
He also said that he has already given a directive to amend the legislation behind appointing board members for the SSB to make the guiding ordinance more “prescriptive” in what qualities candidates must possess. He also said overall transparency and the documentation process for identifying conflicts of interest need to be formalised.
Returning to an earlier hearing, Mr. Rawat noted that Ms. Lake was identified as Premier Andrew Fahie’s first cousin on his father’s side, leading the premier to recuse himself from voting on her appointment in Cabinet.
Mr. Wheatley said he was aware of a family connection between the two, but not the degree. He said most people in the VI don’t consider cousins close family, but he agreed there is a lack of clarity in the law as to the extent of family connections to be considered in government affairs.