Canada's Original Think Tank

Second reading of Bill C-50, An Act to amend the Canada Elections Act (political financing)

Second reading of Bill C-50, An Act to amend the Canada Elections Act (political financing)

Second reading of Bill C-50, An Act to amend the Canada Elections Act (political financing)

Hon. Terry M. Mercer (Deputy Leader of the Senate Liberals):

Honourable senators, I rise today to speak to Bill C-50, An Act to amend the Canada Elections Act (political financing). This bill proposes amending the Canada Elections Act to bring enhanced openness and transparency to federal political fundraisers.

I am particularly interested in this bill as my experience with political fundraising is well known to most. As a certified fundraising executive and active member of the association of fundraising professionals, I’ve spoken extensively on ethical fundraising techniques. As a past national director of the Liberal Party, a large part of that job had to do with fundraising at that time.

As the minister pointed out to our colleagues in the other place, this legislation is designed to encourage more transparency in our public institutions and our political parties.

Before I begin, I’d like to congratulate Minister Gould on the upcoming birth of her child. The minister will now be on maternity leave.

Honourable senators, section 3 of the Charter of Rights and Freedoms guarantees every citizen the right to vote. Our right to vote is probably the most important right we have, to freely choose how we want to be governed. Canada is also an example to other countries in the world struggling to attain or defend that right.

The Charter also enshrines the freedoms of association and expression. Section 2 has been interpreted to include the right of Canadian citizens and permanent residents, subject to reasonable limits, to make a donation to a political party and to participate in fundraising activities.

Political parties are vital to our system of governance. They unite people from different regions and with a variety of different perspectives, backgrounds and experience. Citizens are free to join or donate to a political party of their choice. I could recommend a certain party to them, of course. Voting in an election or for a candidate for the political party is one of the ways Canadians play an active role in society.

To help Canadians decide for whom to vote, fundraising activities fund the party’s ability to operate its internal structures, which helps to expose the party’s policies to the general public. This is partly done through hosting events. Events also provide the opportunity to say “thank you” to its donors. Some fundraising events are really friend-raising events, and we would do well to remember that.

Stewardship is a very important aspect of donor relations. It is what an organization does to ensure that donors experience a certain level of encouragement and gratitude in order for them to start donating, but more important, to keep them donating. I am sure if my old friend and fellow fundraiser, albeit for the Conservatives, Senator Gerstein were here, he would wholeheartedly agree that fundraising activities are at the very heart of how political parties operate. Raising money for a party or donating money to a party is not a bad thing. We shouldn’t treat it as such.

For many Canadians, making a donation to a political campaign is a meaningful way to play a direct role in our democracy. I have done that for many years, and I’m sure that many of you have. We must continue to uphold and protect the right to financially support a political party, because donations help make the work of Parliament possible.

Indeed, as professional fundraisers, we are guided by principles with respect to ethics and transparency. For example, the Donor Bill of Rights was created by the Association of Fundraising Professionals, the Association for Healthcare Philanthropy, the Council for Advancement and Support of Education, and the Giving Institute — all leading consultants to non-profits.

It has been endorsed by numerous organizations, including, by the way, the Liberal Party of Canada. I believe it still is the only political party in the world to do so. It was created:

To assure that philanthropy merits the respect and trust of the general public, and that donors and prospective donors can have full confidence in the not-for-profit organizations and causes they are asked to support . . .

It includes such things as information sharing, organizations’ board structures, access to financial statements and how a donation is handled by an organization. There are structures, guidelines and laws out there to protect organizations and donors.

What we see here today with Bill C-50 is designed to improve upon already existing structures in place to guide political parties in their activities. While we as senators may not be elected, we do understand through past or current experience with our political parties, and donating and volunteering, how fundamental it is to be able to participate in the electoral process however we see fit. Every Canadian enjoys this, too, of course.

Honourable senators, Canada is known around the world for its diligence when it comes to our political fundraising rules.

I would remind everyone that in 2003, Bill C-24, an Act to amend the Canada Elections Act and the Income Tax Act (political financing), was introduced by the government of Prime Minister Jean Chrétien. I had the opportunity to be involved in that process. The bill made sure that rules surrounding political fundraising were clear and transparent. It restricted contributions and contribution limits, and also introduced a per-vote subsidy.

Some didn’t like the bill at the time. Indeed, the per-vote subsidy introduced in the bill was phased out by the Harper government in 2015. Sometimes it’s good to remember our history, honourable senators.

From some research I was given by the department, I note that in 2016 there was an OECD report called Financing Democracy. It focused on the risk that public policy-making can be captured by private interest. OECD Secretary-General Angel Gurría warned that the consequences include the erosion of democratic governance, social cohesion and equal opportunities for all, as well as the decline of trust in democracy itself.

Of the member countries surveyed, just under half had no donation limits. Of the rest, some were higher than Canada’s. There is only one country, Belgium, which had a lower limit than Canada’s, although it is important to note that in Belgium, public funding covers 85 per cent of the funding going to political parties.

It is also important to note that while we may have rebates available during elections and tax receipting for donors who contribute to parties, we no longer have a per-vote subsidy, which I mentioned earlier.

This reminded me of an interesting fact. In the United States, there are spending limits for political parties but not really for candidates. It is quite a complicated system. In Canada, we have limits for both parties and candidates.

To illustrate this, let’s take a look at the election of 2000 for the Senate seat in the state of New York. Democratic candidate Hillary Rodham Clinton and Republican candidate Rick Lazio spent approximately $70 million. It was one Senate seat, one state — $70 million.

By comparison, in the 2000 Canadian general election, the then six major political parties in Canada spent a combined total of $35 million — six parties across the whole country. And they spent $70 million in the state of New York alone. That’s about half for the entire country versus one state.

Some other research I have seen was from Transparency International’s 2016 Corruption Perceptions Index. This annual study measures perceptions, because it is impossible to accurately measure the actual incidents of bribery and other forms of corruption around the world. The 2016 report reviewed 176 countries and placed Canada as one of the least corrupt countries in the world. This is good news. Among the G20 countries, Canada was number one, topping the Americas in the charts by a considerable margin.

I am not surprised by this. Our history of expanding and improving upon laws that make political donations more transparent is quite clear. Improvements have been made by both Liberal and Conservative governments.

Honourable senators, political parties need funding to operate in order to pay for staff, office space, advertising, et cetera, and we all need strict rules to govern the funding of these parties. We do face a balancing act. We need to respect the constitutional rights of Canadians to participate in our system while ensuring that all Canadians are able to exercise these rights equally.

This was also clear when Parliament was debating Bill C-24 many years ago. As a review, in Canada, donations from corporations and unions are prohibited under the existing legislation. There are strict limits on the contributions an individual can make. Canadian citizens and permanent residents can contribute a maximum of $1,550 annually to each registered political party. That’s cumulative; you can’t give that amount to each party. That’s a cumulative total. They can donate $1,550 to leadership candidates in a particular contest. Again that’s a cumulative number, not individual.

In addition, they can donate $1,550 to contestants for nomination and/or candidates in a riding association for various political parties. Again, that’s a cumulative number.

Contributions are reported to Elections Canada, and the name, municipality, province and postal code of those who contributed more than $200 are published online. Please note that fact as we continue. It’s online; you can go and have a look at it.

Bill C-50 builds on this. When a fundraising event requires an attendee to contribute or pay a ticket price totalling more than $200, the name and partial address of each attendee, with certain exceptions, will be published online. The exceptions, so you will be clear, are youth under 18, volunteers, event staff, media, someone assisting a person with a disability, or support staff for a minister or party leader in attendance. They don’t need to report.

Bill C-50 aims to provide Canadians with more information about political fundraising events in order to continue to enhance trust and confidence. If passed, Bill C-50 would allow Canadians to learn where and when a political fundraiser that has a ticket price or requests a contribution above $200 is happening and who attended. This legislation would apply to all fundraising activities attended by cabinet ministers, including the Prime Minister, party leaders and leadership contestants that meet the criteria.

This provision also applies to appreciation events for donors to a political party.

I would point out here that if a donor has given $200 to their party of choice, that information will be published already by Elections Canada, so by publishing the names again after an event is held may seem like a moot point. What it does is allow Canadians to see exactly who attended what political event in order to show that the event and, in particular, the party has nothing to hide.

Honourable senators, Bill C-50 requires parties to advertise fundraising events at least five days in advance. Canadians would know about political fundraisers before the event takes place, giving them an opportunity to inquire about the ticket if they wish. The legislation would apply only to parties with a seat in the House of Commons.

Bill C-50 would also give journalists the ability to determine when and where fundraisers are happening. At the same time, political parties would retain the flexibility to set their own rules for providing media access and accreditation. Parties would be required to report the names and partial addresses of attendees to Elections Canada within 30 days of the event. That information would then become public with the exception of fundraisers that occurred during an election period. Fundraisers for an election period have similar rules with different timelines for publication.

The bill would also introduce new offences in the Canada Elections Act for those who didn’t respect the rules and require the return of any money collected at that event. These sanctions would apply to political parties and event organizers.

At this point, I would like to thank everyone who participated in the bill review process in the other place. The government accepted several amendments to the legislation in committee. I look forward to reviewing those and the bill when we get the bill to committee here in the Senate.

As mentioned by the minister in the other place — and I think this bears repeating — Stéphane Perrault, the Acting Chief Electoral Officer, endorsed Bill C-50, stating the following:

Generally speaking, the bill increases the transparency of political fundraising, which is one of the main goals of the Canada Elections Act. It does so without imposing an unnecessary burden on the smaller parties that are not represented in the House of Commons or for fundraising events that do not involve key decision-makers.

Honourable senators, while we know that Canadians do have confidence when it comes to political financing and donating, I believe there is always room for improvement. Improving upon how fundraising activities operate builds on our already strong system for political fundraising in Canada. Some say, “Why bother then?” Some may say we already have enough in place to protect the system.

I say it’s never a bother when we can improve it, as long as it does not overburden that same system with regulations that make no sense. Fundraising is already hard enough without putting more pressure on it. I do not believe this bill adds more burden, and I look forward to discussions further here and in committee. Thank you, honourable senators.