The rules in Canada for donations and loans to political parties are unfair, undemocratic, corrupting and rigged in favour of a few wealthy voters, wealthy candidates, the big parties and Canada’s Big Banks, and is essentially a legalized bribery system
The only way to stop the unethical influence of big money donations and loans is to prohibit big money donations and loans
This video gives a brief summary of key facts and figures, and all the details are set out below
Voters are allowed to donate thousands
to federal political parties each year
The amount that a voter is allowed to donate each year to a federal political party grows each year by $25, so the amount was $1,525 in 2016 and the amount in 2024 is $1,725.
Each voter is also allowed in 2024 to donate another $1,725 to each party’s riding associations.
So the total amount each voter is allowed to donate in 2024 to each federal party and its riding associations is $3,450.
Wealthy nomination contestants that can afford it are also allowed to donate an additional $1,000 to their own campaign, and wealthy election candidates are allowed to donate an additional $5,000 to their own campaign, and wealthy party leadership contestants are allowed to donate an additional $25,000 to their own campaign.
But a large majority of voters only donate about $75 a year
Do you have an extra $3,450 laying around to donate to a federal party?
Did you know that, on average from 2016 to 2022, out of every 100 donors to the main Canadian federal political parties, approximately 75 donors donated only about $75 each year?
To see details about donations to the main federal parties from 2016 to 2022, click here.
NOTE: 2023 donation figures are not included in these calculations because final statistics for the number of voters who donated various amounts to a federal party in 2023 will not be available until summer 2023. To see the 2023 statistics that are available, click here.
Only about 5% of donors donate more than $1,000 to a federal party
Did you know that only about 5 out of every 100 donors donates more than $1,000 a year?
To put it another way, out of more than 27 million voters, on average only about 11,000 voters donate more than $1,000 a year to any of the main federal parties.
Wealthy donors use their big donations to buy influence
Because their donations are so much bigger than what most people give, those 11,000 donors, which again are only about 5% of all donors each year, donate on average
- about 40% of the total amount donated each year to the Liberal Party
- about 30% of the total amount donated to the Conservative Party
- about 20% of the total amount donated to the NDP
- about 17% of the total amount donated to Green Party
- and about 11% of the total amount donated each year to the Bloc Quebecois
Donors who donate $1,000 or more donated on average 30% of the total average amount raised by the 5 main parties each year from 2016 to 2022.
So those wealthy donors who donate more than $1,000 are very valuable to the main federal parties, especially to the Liberals and Conservatives.
Studies conducted worldwide have shown that the best way to influence someone’s decisions is to give them something or do them a favour, and big money donors give a lot to politicians, which is a huge favour for them. Click here to see a summary of these studies.
There have been examples across Canada of wealthy donors using big donations to gain access to, and influence, politicians:
- at the federal level with the SNC-Lavalin scandal;
- and also at the federal level when B.C. donors donated to Ontario and Quebec ridings;
- and when Quebec construction firm executives made large federal donations;
- and in Ontario with the Greenbelt scandal;
- also in Ontario with the Hydro One scandal;
- in Alberta with the labour law scandal;
- and elsewhere.
To see details about the top donors to the main federal parties, click here.
NOTE: 2023 donation figures are not included in these calculations because final statistics for the number of voters who donated various amounts to a federal party in 2023 will not be available until summer 2023. However, the available 2023 statistics show that donors who donated $1,000 or more donated about 46% of the total amount raised by the Liberals; about 35% of the Conservative total; about 19% of the NDP and Green Party total; about 17% of the PPC total, and about 15% of the Bloc total. To see the 2023 statistics that are available, click here.
Of course, parties supported most by wealthy donors benefit most from big money donations, as do nomination contestants, election candidates and party leadership contestants who are supported by wealthy donors.
Canada’s big money donation system also favours wealthy nomination contestants as they are allowed to donate an additional $1,000 to their own campaign, wealthy election candidates as they are allowed to donate an additional $5,000 to their own campaign, and wealthy party leadership contestants as they are allowed to donate an additional $25,000 to their own campaign.
Allowing big money donations also makes it easy to funnel large amounts of money to parties, including from foreign governments
Also, while it is illegal for a business, union, organization or voter to funnel money through other voters, because voters are allowed to donate more than $3,000 a year to federal political parties and their riding associations, it is easy to funnel tens of thousands of dollars annually.
Big businesses and other organizations can do this easily by giving their executives a bonus each year that they donate to the party that does the most for the business or organization.
It is impossible to charge or prosecute any business or organization that does this because all the executives have to do is say that they donated with their own money.
In fact, this has happened at the federal level and in every province and territory because they all, except Quebec, allow donations of more than $1,000 annually. To see details about all of these donation-funneling schemes across Canada, click here.
When big money donations are allowed, it also makes it easier for foreign governments to funnel large amounts of money through individuals and lobby groups to influence Canadian politicians and parties.
No matter what problems concern you, as long as wealthy interests can use big money donations to influence politicians, it is unlikely politicians will solve the problems that concern you.
Democracy Watch needs your support now to stop the unethical, undemocratic influence of big money on politicians across Canada!
Please donate now at: https://democracywatch.ca/donate/
And please go to StopBigMoney.ca and join the tens of thousands of voters calling for these and other key changes to stop the unethical, undemocratic influence of big money on politicians across Canada!
Only about 240,000 voters donate to a federal party each year, and 9 out of 10 donate less than $500
What about the people in the middle of the 5% or so of wealthy big money donors who donate more than $1,000 and the 75% or so of donors who donate only about $75 a year?
Only 6 out of every 100 donors donates between $500 and $1,000, while 16 out of every 100 donors donates between $200 and $500.
Only a very small percentage of Canadians donate to any of the main federal political parties. Out of more than 27 million voters, only about 240,000 donate each year, less than 1% of all voters:
- about 173,000 voters donate only about $75 each year
- about 38,000 donate between $200 and $500
- about 15,000 donate between $500 and $1,000
- and again only about 11,000 donate more than $1,000
In total, all the voters together donate an average of about $52 million each year to the main federal political parties.
To see details about donations to the main federal parties from 2016 to 2022, click here.
Federal parties spend most of what they raise each year, and rely on unethical big money loans from banks to pay for their election campaigns
However, most of the main federal parties spend almost all of the money they raise each year, and so when an election happens they don’t have very much money to pay for their election campaign.
So what do they do? The 3 main parties, the Liberals, Conservatives and NDP, get huge loans of millions of dollars from banks and other financial institutions to pay 70% to 80% of their total election costs (and sometimes even more).
These banks and other financial institutions are covered by the federal Bank Act which is under the control of federal politicians. So giving these loans is a huge favour that the banks do for the main parties, a favour that creates an appearance of a conflict of interest for all the politicians in these parties.
To see details about bank loans to parties, click here.
Tens of millions of your tax money is given to the parties each year, mostly to help wealthy donors and the big parties
Canadian taxpayers support the main political parties just as much. Parties that receive more than 2% of the total number of votes each election – or 5% of the total votes in the ridings where the party runs candidates – get half, 50%, of the money they spent on the election back, reimbursed with our tax money.
Also, election candidates from any party who win 10% or more of the total votes in their riding get 60% of the money they spent on their election back.
On average, the 5 main federal parties all together receive about $34 million back after each election, and their candidates receive about $29 million in total back, paid for with our tax money.
Only 1 other party in one election (the People’s Party of Canada in 2021), and only a few other candidates in each election, have received these taxpayer subsidies since 2004.
To see details about how much the federal election reimbursement system is unfair and favours the main parties, click here.
You may be thinking – but aren’t small donations and big money donations equalized because small donors are allowed to deduct most of their donation from their taxes?
It’s true that all Canadians support federal political parties through the tax system as part of a donation can be deducted from income tax that a donor pays.
But, as with donations, the income tax deduction favours wealthy donors.
First, you have to pay taxes to benefit from the deduction, so people with low incomes, even if they have money to donate to a party, don’t benefit from the deduction because they don’t pay income tax.
Secondly, wealthy voters who make big money donations claim most of the tax deduction. On average from 2017 to 2020, voters who earn $100,000 or more claimed almost half, 50%, of the about $27 million in total tax deductions claimed each year for donations to federal political parties.
Meanwhile, voters who earn $45,000 or less, the amount most voters make each year, only claimed 13% of all the tax deductions for donations.
To see details about who claims tax deductions, click here.
Conclusion: We need to prohibit big money donations and loans and, if public funding is given, make it democratic
So that’s how the rules in Canada for donations and loans to political parties are unfair, undemocratic, corrupting and rigged in favour of a few wealthy voters, wealthy candidates, the big parties and Canada’s Big Banks, and is essentially a legalized bribery system:
- A small number of wealthy voters donates a large part of the money each of the main federal parties raise each year (especially to the Liberals and Conservatives).
- The system favours wealthy contestants and candidates – if they can afford it, nomination contestants are allowed to donate an additional $1,000 to their own campaign; election candidates are allowed to donate an additional $5,000 to their own campaign, and party leadership contestants are allowed to donate an additional $25,000 to their own campaign.
- A small number of banks loan the main parties 70% to 80% of the total amount of money they spend each election.
- All taxpayers give about $27 million each year to the main parties in subsidies through tax deductions that mostly go to their wealthy big money donors.
- And after each election all taxpayers give the main parties about $34 million, and their candidates about $29 million, in direct reimbursements of 50% and 60% of the money they spent on their election campaign.
None of this is fair, ethical or democratic.
If we want to have a fair, democratic political system that is not corrupted by wealthy big money interests, the amount that a voter is allowed to donate to each party should be limited to the amount most voters give – only about $75 a year.
And the amount that any voter can loan to a party should also be limited to $75.
If the amount that a voter is allowed to donate and loan to each party is limited to only $75, which is again the amount that about 75% of donors donate each year, what would happen?
The main political parties would likely claim that they would have much less money than they have now, and that would cause problems for them reaching and informing voters, running their operations, and running their election campaigns.
But these would be false claims.
Remember, only about 240,000 out of more than 27 million voters currently donate to any of the main federal parties each year. So the parties have more than 26 million other voters they could get donations from to make up the amount they would lose from stopping big money donations and limiting donations to $75 each year.
About 1 million voters belong to the 5 main federal parties. So all the parties have to do is get about 500,000 more of those 1 million voters to donation $75 each a year and they would raise the same amount of money they raise currently each year. Again, that’s only about 500,000 extra new donors out of the total of more than 26 million voters who currently don’t donate to any federal party.
The Conservatives would need to convince about 220,000 more voters to donate to them, the Liberals about 170,000, the NDP about 63,000, the Greens about 30,000 and the Bloc about 10,000.
NOTE: 2023 donation figures are not included in the calculations in the above chart because final statistics for the number of voters who donated various amounts to a federal party in 2023 will not be available until summer 2023. To see the 2023 statistics that are available, click here.
Lowering the donation limit to $75 a year would make all the parties more connected with more voters, and more connected with the concerns of more voters, which is democratic.
Lowering the donation limit to $75 a year would also prohibit wealthy individuals and businesses and lobby groups (including foreign government-sponsored lobby groups) from using big money donations and big money fundraising events as a way of unethically influencing the decisions of politicians and party leaders.
With a donation limit of $75 a year, the only voters who should receive a tax deduction or subsidy for making a donation should be voters who have very low incomes.
What if the parties can’t raise as much as they raise now if donations are limited to $75 a year?
If the parties claim they can’t raise enough from donations to inform voters and run their offices, or that they can’t save some of their money each year so that they have enough to pay for their next election campaign, they should be required to prove both those claims before they are given any public funding.
If the parties can prove either of these claims, the best way to provide public funding is to match the donations the parties raise with public funding, so that the parties always have to convince voters to donate in order to get public funding.
If matching donations still doesn’t give the parties enough to run their election campaigns, a public fund should be set up to lend them money for their campaign based on the number of candidates each party has.
This will stop the Big Banks from buying influence by giving the parties big loans worth millions of dollars for their election campaigns.
And, to make the public election subsidies fair, every party should receive 50% of the money they spend on elections back from public funds, and every candidate should receive 60% of what they spend back.
Making these changes will make Canada’s political donations and loans system fair and democratic, instead of unfair, undemocratic, corrupting and rigged in favour of a few wealthy voters, wealthy candidates, the big parties and Canada’s Big Banks.
Making these changes will also help stop foreign interference in Canadian politics.
These same changes are also needed in all provinces and territories except Quebec which already has a $100 limit on donations each year and donation-matching public funding.
Saskatchewan, Newfoundland and Labrador and the Yukon have no limits on donations, and still allow donations from businesses, unions and organizations even from outside the province or territory. They are the most undemocratic and unethical jurisdictions in Canada with their “best government money can buy” systems.
But all other provinces and territories also still allow big money interest to unethically influence politicians and parties, as they all still allow individual voters to donate from $1,200 up to $10,000 dollars annually to parties and their riding associations, which is much more than most voters can afford.
No matter what problems concern you, as long as wealthy interests can use big money donations to influence politicians, it is unlikely politicians will solve the problems that concern you.
Democracy Watch needs your support now to stop the unethical, undemocratic influence of big money on politicians across Canada!
Please donate now at: https://democracywatch.ca/donate/
And please go to StopBigMoney.ca and join the tens of thousands of voters calling for these and other key changes to stop the unethical, undemocratic influence of big money on politicians across Canada!