Friday, June 6, 2003

OTTAWA - Democracy Watch today praised the work of the House Standing Committee on Procedure and House Affairs, which strengthened key provisions of the government's proposed political fundraising law, Bill C-24.

"MPs on the committee worked diligently on this bill, and demonstrated integrity by strengthening it," said Democracy Watch Board Member Aaron Freeman, who also chairs the 50-group Money in Politics Coalition.

The committee reduced the bill's individual donation limit from $10,000 to $5,000, reducing the amount of money that donors can give to try to influence politicians.  The committee also improved the political party donations reporting system.  Currently, parties report their donations six months after the end of the year, with the result that disclosure occurs up to 18 months following receipt of the donation.  Under a government-sponsored amendment, the committee changed the bill to require disclosure of donations by major parties every 3 months.

In another improvement to the disclosure regime, an NDP amendment moved by MP Dick Proctor adds a requirement to disclose the conditions of all loans to parties and candidates.

In addition, a government-sponsored amendment lowered the expense limit for nomination race contestants from 50 percent to 20 percent, or about $15,000 per candidate.

"The committee's changes strengthening Bill C-24 will keep the cost of running for office more reasonable, improve transparency, and limit the influence of wealthy donors," said Freeman.

Weaknesses still remain in Bill C-24.  Secret donations to MPs' trust funds, which can pay for a wide range of personal expenses, are not dealt with by the bill, nor are expense limits for leadership races.  The committee also balked at eliminating corporate and union donations.  While the $1,000 annual cap on these contributions will limit the influence of these donors, it will create headaches for Elections Canada officials and donors alike, as it will be difficult for corporate donors, unions and unincorporated organizations to coordinate with all of their subsidiaries and affiliates when making political donations, and difficult for regulators to determine if links exist among different organizational donors.

"Time will show that it makes more sense to simply ban donations from corporations, unions and other organizations so that only individuals can make donations, as in Quebec and Manitoba," said Freeman.

However, Democracy Watch and the Money in Politics Coalition believes Bill C-24 takes some good steps toward an open, democratic, and ethical political donations system, and called for the committee-amended version to be passed before the Parliament rises this summer.

Media reports suggest that when Bill C-24 returns to the House of Commons, the Liberal Government will introduce amendments increasing the public subsidies proposed in the bill.  Democracy Watch believes that this increase in taxpayer support to political parties and candidates is unnecessary and wasteful, especially since current provisions in the bill already compensate the parties for any revenues that would be lost as a result of Bill C-24's donation restrictions.  The public subsidy to parties should be reduced to effectively require parties to democratize themselves by reaching out and building a broad base of individual donors.

The 50-group Money in Politics Coalition will continue to push to strengthen Bill C-24 in the ways proposed above as the bill moves through Parliament.