How to stop Big Money from corrupting Canadian politics

We will only eliminate corruption in politics if we impose strict limits on fundraising and spending

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political financeOTTAWA, Ont. April 6, 2016/ Troy Media/ – We need a clear set of new, stringent rules to stop big money from corrupting Canadian politics at all levels.

While the federal government banned corporate and union donations in 2007, its $3,050 annual donation limit for individuals ($1,525 to a party and the same amount to its riding associations) is still much more than an average Canadian can afford.

As a result, wealthy people can use money to influence federal politics, especially since they can give $3,050 to more than one party. That high donation limit also allows businesses, unions and other organizations to funnel donations through their executives.

Some propose that requiring donors to identify their employer would stop this funnelling. However, donors could just claim they were not forced to donate and no one would be able to prove otherwise.

Quebec learned this the hard way: few have been charged in a corruption scandal even though an Elections Quebec audit found $12.5 million in likely funnelled donations from 2006-2011. To stop the corruption, in 2013 Quebec lowered its individual donation limit to $100 annually and required donations to be verified by Elections Quebec before being transferred to parties and candidates.

Some claim that political parties wouldn’t have the money they need to operate under the Quebec limit. They conveniently fail to mention other elements of Quebec’s world-leading system, and also that email and social media make reaching voters less expensive than ever.

Quebec has per-vote annual funding for political parties (as do four other provinces, although Stephen Harper’s Conservatives eliminated it at the federal level), plus public funding that matches the first $200,000 raised by a political party and $20,000 raised by an election candidate. These amounts close the gap left by ending large donations from wealthy interests.

Some argue against the per-vote subsidy – even though it upholds the key democratic principle of one-person, one-vote – by claiming it forces voters to give money to parties they don’t support. Actually, the $1 or $2 comes from taxes everyone pays and goes only to the party they support (and only if they vote).

Matching funds raised is also more democratic than other options, since a party or candidate needs broad support to access significant funds, and the matching helps equalize the funding available to all.

A per-vote subsidy shouldn’t provide more than half the annual funding for any party, to ensure parties can’t prosper by offering voters false promises to boost the votes (and money) they receive.

The current voting system and other subsidies shift a lot of taxpayer money in undemocratic directions. For example, in the 2011 federal election the Conservatives elected 24 MPs more than their popular support justified (they received 39.6 per cent of the vote but won 54 per cent of the seats). Each of those MPs received about $440,000 annually in salary and office expenses, so the Conservatives received a subsidy of $10.5 million every year until the 2015 election. Now the Liberals receive roughly the same amount of unjustified subsidy.

As well, the average individual donation to each federal party is only $100 to $250, yet people who donate up to $400 receive a 75 per cent tax deduction. And people who donate the maximum $3,050 receive half that total as a tax deduction. These taxpayer-funded subsidies add up to more than $20 million annually.

We also need to limit loans to parties and candidates. Currently, financial institutions (and, in some jurisdictions, businesses, unions and individuals) can loan them unlimited amounts.

As well, all campaign spending by parties – including for nomination races, election and party leadership candidates – must be limited to no more than a dollar per voter.

Spending on advertising by third party interest groups must also be limited during campaigns – only the federal government and five provinces now have such limits – and each third party should have to prove its supporters (or shareholders) approved the spending.

Election and ethics watchdogs must do regular audits, including of politicians’ bank accounts, to ensure everyone follows all the rules.

Finally, individuals and interest group should be required to disclose how much they spend on any issue campaign between elections, and their funding sources. If that reveals a huge disparity in funding and funding sources, limits should be imposed.

These changes won’t stop bribery but they will make it more clearly illegal and increase the chances of getting caught. Until all Canadian jurisdictions (federal, provincial, territorial and municipal) make these changes, big money will continue to dominate, and corrupt, our politics.

Duff Conacher is the co-founder of Democracy Watch and a visiting professor at the University of Ottawa.

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