1. Immigration Minister Elinor Caplan did include a list of the identities of donors to her riding association in the forms filed with Elections Canada. However, for whatever reason, Elections Canada (the federal agency that regulates elections and donations) did not include the list in Minister Caplan's file. As a result, when Democracy Watch reviewed Minister Caplan's file it did not include the list of donors to her riding association. Elections Canada has now has now corrected its oversight and added the list to Minister Caplan's file.
2. Minister for International Cooperation Maria Minna did include a list of the identities of donors to her riding association in the forms she filed with Elections Canada. However, for whatever reason, Elections Canada did not include the list in Minister Minna's file. As a result, when Democracy Watch reviewed Minister Minna's file it did not include the list of donors to her riding association. Elections Canada has now corrected its oversight and added the list to Minister Minna's file.

1. Secretary of State (Asia Pacific) Rey Pagtakhan received $55,000 from his riding association in the form of a loan from his riding association, not a transfer of donations from his riding association. Democracy Watch has requested a clear description from Elections Canada of the disclosure requirements in the Canada Elections Act because Democracy Watch believes that the identities of the source(s) of donations that Secretary of State Pagtakhan or his riding association may receive in the future to pay back the loan do not have to be disclosed.
2. Bloc québécois leader Gilles Duceppe disclosed the identities of the 12 donors who gave in total $24, 250 of the $35,452 total his riding association gave to his election campaign. The identities of the donors who gave the remaining $11, 202 to his riding association have not been disclosed because, according to Mr. Duceppe's file at Elections Canada, each of the donors gave less than $200. The Canada Elections Act does not require disclosure of the identities of donors who donate less than $200 to a political party or candidate.
3. The Canada Elections Act does not require public disclosure of the names of donors to riding associations or candidates between elections, nor does it require expenses of riding associations to be disclosed. However, if a riding association transfers funds to a candidate's election campaign, the identity of the donor(s) of the funds must be disclosed, except:
   (a) if the donation or donations from a donor total less than $200;
   (b) if the transfer is from a surplus from the previous election campaign;
   (c) if the donation was made prior to the date on which the new Canada Elections Act became law (which was September 1, 2000); or
   (d) if the identity of donors of the funds transferred from the riding association to the candidate cannot be identified (NOTE: if this is the case, the identities of all donors who made donations to the riding association since the previous election must be disclosed).

Monday, April 23, 2001

OTTAWA - Democracy Watch today denounced the $2.1 million in hidden donations that flowed into the coffers of Liberal candidates during last November's election campaign period.

Canada's elections law requires that all donations to candidates above $200 be publicly disclosed. However, the hidden donations were routed through party riding associations using a loophole in the law that allows a candidate to avoid the disclosure requirement if a donation is made first to the riding association before the election is called and then transferred to the candidate during the campaign.

"This loophole makes a mockery of the donation disclosure requirement," said Democracy Watch Board Member Aaron Freeman. "It results in an optional system of disclosure that allows millions of dollars in hidden donations to flow freely into election campaigns."

The riding association loophole is widely used, and some candidates employ it to direct huge stealth sums to their campaigns. For example, the following are among the Elections Canada filings by Liberal candidates who received donations from riding associations during the last election:

• Government House Leader Don Boudria, the minister responsible for federal political finance rules, received half of his total election campaign funds from his riding association in one donation of $35,000.
• Immigration Minister Elinor Caplan received $64,880 from her riding association, and no other donor was listed in her filings with Elections Canada.
• Defence Minister Art Eggleton enjoyed a $60,000 donation from his riding association.
• Minister for International Cooperation Maria Minna transferred $66,000 from her riding association -- $5,000 more than she actually spent on her campaign.
• Secretary of State (Asia Pacific) Rey Pagtakhan received $55,000 from his riding association, more than double the amount received from all other sources combined.

Opposition members also moved considerable sums from their riding associations. Bloc québécois leader Gilles Duceppe's riding association gave $35,452 to his campaign. And Canadian Alliance Leader Stockwell Day received $20,000 from his association.

In the 1997 election, Liberal Cabinet ministers funneled $401,608 from riding associations into their campaigns, 15 percent of the total amount they raised. In the 2000 election, ministers raised $3.2 million, and again 15 percent -- or $490,569 -- was transferred from their riding associations.

Democracy Watch and its nation-wide, 50-member group Money in Politics Coalition, called on the Liberals to change Bill C-9, which amends the Canada Elections Act, to close the riding association loophole, and many other undemocratic loopholes, in the federal political finance system. Bill C-9 receives third reading in the House of Commons this week, and then will be reviewed by the Senate.

"Canadians have a right to know the identities of the wealthy special interests who are bankrolling the political process, especially when, as is usually the case, these interests have the greatest stake in government decision-making," said Freeman.