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As Quebec’s experience shows clearly, Ontario Liberals’ proposed annual political donation limit of $7,750 to each party won’t do anything to stop unethical influence of wealthy interests

Should be lowered to Quebec limit of $100, and candidate personal donations, and annual per-vote public funding amount, also much too high — ban on corporate, union etc. donations, and limits on party and third-party ad spending, are good

Same changes should be made at same time to municipal system across province

Tuesday, May 17, 2016

OTTAWA – Today, Democracy Watch and the 50-member group Money in Politics Coalition applauded some of the Ontario Liberals’ proposed political finance reform bill, but called on them to lower their proposed annual political donation limit, candidate personal donation limit because both are much too high and will allow wealthy interests, and wealthy candidates, to continue to have an undemocratic advantage over most voters. The high donation limits will, as Quebec’s experience shows, also facilitate and hide corrupting large donations from business and union executives and their families.

The Liberals should also lower the per-vote annual public funding amount as it will give parties more than a base amount of funding and will allow them to prosper even if they lose significant voter support in between elections. Matching funds raised by parties and candidates with public funding should also be added to the new system.

According to the Ontario government’s news release, the Liberals’ bill proposes the following good changes: a ban on donations by corporations, unions and other organizations; limits on political party and third party advertising spending leading up to an election, and during an election campaign period, and; registration requirements and limits on donations to nomination race candidates and political party leadership race candidates.

“While some of the bill’s proposals are good steps forward, the proposed annual individual political donation limit of $7,750 to each party is clearly undemocratic because it is many times higher than an average voter can afford,” said Duff Conacher, Co-founder of Democracy Watch and Chairperson of the Money in Politics Coalition. “As Quebec’s corruption scandal shows clearly, such a high donation limit will allow wealthy individuals to continue to use money as an unethical way to influence politicians, and will also allow corporations, unions and other organizations to continue to donate large amounts by having their executives and their family members all make the maximum donation each year.”

“The Ontario Liberals’ proposed high donation limit will only hide the corrupting influence of donations from wealthy interests, not stop it,” said Conacher.

Instead of matching Quebec’s world-leading political finance system of a $100 annual individual donation limit to each party, and annual public per-vote and matching funding, the Liberals propose that individuals be allowed to donate up to $7,750 annually to each party, as follows: $1,550 annually to a political party; $1,550 annually to an individual candidate (with a maximum of $3,100 to all of a party’s candidates); and $1,550 to a constituency association (with a maximum of $3,100 to all of a party’s constituency associations). And the Liberals are not proposing to limit loans to parties and candidates at all.

Even if funneling donations is made illegal (as it was in Quebec), the donors will just claim they were not forced by their company or union to make the donation, and no one will be able to prove otherwise.

Few have been charged in Quebec’s corruption scandal even though an Elections Quebec audit found $12.8 million in likely illegally funneled donations from 2006-2011. To stop the corruption, in 2013 Quebec lowered its individual donation limit to $100 annually to each party, with an additional $100 allowed to be donated to an independent candidate), and required donations to be verified by Elections Quebec before being transferred to parties and candidates. Ontario should make the same democratic changes.

The bill also allows nomination race and election candidates to donate $5,000 to their own campaign, and party leadership candidates to donate $25,000 to their own campaign. Candidates should not be allowed to donate more than anyone else to their campaign as it gives an advantage to wealthy candidates.

“Allowing candidates to donate thousands of dollars to their own campaign undemocratically favours wealthy candidates,” said Conacher.

The Ontario Liberals should also lower the proposed annual per-vote public funding subsidy from $2.26 per vote to no more than $1 per vote, and implement the same annual public funding matching system as Quebec ($2.50 for the first $20,000 raised annually by each party, and $1 for the first $200,000 raised annually). Elections Quebec has analyzed the results of Quebec’s changes and found that the parties are still adequately funded.

“To match Quebec’s world-leading democratic system, Ontario must limit individual donations to about $100 annually and use per-vote and matching public funding to give parties and candidates funding based on their actual level of voter support,” said Conacher. “Similar changes should be made to Ontario’s municipal law, taking into account that there are no parties at the municipal level, so that every municipality in the province has the same democratic rules.”

The key changes Ontario must make to actually democratize its provincial political finance system are as follows (and similar changes should be made province-wide to the municipal political finance system, taking into account that there are no political parties at the municipal level):

  1. a ban on donations by corporations, unions and other organizations (Quebec enacted such a ban in the late 1970s);
  2. a limit on annual donations by individuals to each party of $100-200 annually (Quebec’s limit is $100) with donations routed through the election watchdog agency (as in Quebec);
  3. a prohibition on loans to political parties, riding associations and candidates, except from a public fund (with loans limited to the average annual amount of donations received during the previous two years);
  4. a limit on spending during leading up to, and during election campaigns by parties, nomination race and election candidates, third party interest groups, and candidates in party leadership races;
  5. disclosure of all donations and gifts of money, property, services and volunteer labour given to any party, riding association, politician, nomination race, election or party leadership candidate, including the identity of the donor’s employer, and board and executive affiliations (and the identity of organizers of any fundraising event);
  6. a base amount of annual public funding for parties based on each vote received during the last election (no more than $1 per vote, with a portion required to be shared with riding associations);
  7. annual public funding for parties matching the first $100,000-$200,000 raised (as in Quebec);
  8. public funding for candidates matching the first $20,000 raised (as in Quebec), and;
  9. a requirement that election, donation and ethics watchdogs conduct annual random audits to ensure all the rules are being followed by everyone.

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Duff Conacher, Co-founder of Democracy Watch
Tel: (613) 241-5179
Cell: 416-546-3443
[email protected]

Democracy Watch’s Money in Politics Campaign