Monday, July 9, 2001

OTTAWA - Today, in response to the recent release by Elections Canada of last year's donations to political parties, Democracy Watch called on the federal government to close the many loopholes in Canada's political fundraising system that allow secret donations of any amount.

"As the fundraising loopholes become ever more apparent, politicians are responding by ploughing their heads deeper into the sand," said Aaron Freeman, a Democracy Watch Board Member.

The loopholes in Canada's fundraising rules allow donors to have undue influence in the political system, often beyond public scrutiny. They include the following:

1. Candidates in political party leadership races are not required to disclose their donors and donation amounts.
2. MPs do not have to disclose donors and donations between elections.
3. Party riding associations are not required to disclose all their donors and donation amounts, and are not required to disclose their expenses.
4. Donations are not required to be disclosed until up to 18 months after they are made, with no requirement to disclose on what date the donation was made.
5. There is no limit on donations. Donors may spend whatever they wish in their attempts to influence the federal government.

These loopholes have been repeatedly identified by Canada's Chief Electoral Officer, as well as Canada's Royal Commission on Electoral Finance (the Lortie Commission). They remain, despite being closed in many other jurisdictions. Quebec and Manitoba, for example, have placed a cap of $3,000 on all political donations, and have banned donations by corporations and other organizations. Many provinces, including Alberta and Ontario, require disclosure of all donations to riding associations. In the U.S., donations are disclosed on a monthly basis, and the figures are available on the Internet.

"When Canadians went to the polls last November, they had no idea who was bankrolling the various parties on the ballot," said Freeman. "Making the public wait up to 18 months to find out donors shows a complete disdain for the public's right to transparency in the political process."

Recent media attention has focused attention on the hidden money flowing into the un-official Liberal Party leadership race, with some campaigns claiming to have raised pledged amounts as high as $10 million. While the donors remain secret, serious questions have been raised about whether the money comes from companies the ministers regulate in their portfolios.

"Fundraising for leadership races is a practice that is fraught with potential conflicts of interest," said Freeman. "The only democratic solution is to put all the money raised on the table."