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Leaf's at Kanto as the reigning champion while Red's gone.
Actually, Lance is still the Champion according to this game. He's just being negligent and left his post. Again. >_>
Leaf is still imaginary though. Or chilling in Hoenn for the holidays: http://cdn.bulbagarden.net/upload/6/61/New_Years_postcard.jpg
Ethan defeated him, so he's not champion anymore. The current champion of Kanto is Leaf, while Brandon/May are this of Hoenn, and Lucas/Dawn are this for Sinnoh. This is why Lance, etc. are free to leave to Unova. It's also the same reason Iris isn't there - Rosanate left her as acting Champion so s/he could still travel.
"Murder of the living is tragic, but murder of the idea is unforgivable." - Janus, speaker of the synod