Reform of political financing and the control of election expenses - The Chief Electoral Officer makes a positive assessment and recommends further action

QUEBEC CITY, Sept. 4, 2014 /CNW Telbec/ - In a report released today, the Chief Electoral Officer of Québec, Lucie Fiset, provides a positive assessment of the reforms to political financing and the control of election expenses in Québec enacted since 2010. "We have come a long way in terms of cleaning up financing and improved enforcement of rules, and this has helped restore citizens' faith in our democratic institutions," Ms. Fiset pointed out, "especially since the new powers granted to the office of the Chief Electoral Officer since 2010 have made us more effective in our role as watchdog and prosecutor before the courts."

Increased powers and responsibilities of the Chief Electoral Officer

The report filed today indicates, amount other things, that the capacity of the office of Chief Electoral Officer to obtain tax-related information has enabled it not only to draw up a revealing portrait of sectoral financing, but also to issue more than 200 statements of offence in cases involving straw man schemes. In the aftermath of these legal proceedings, the office has claimed $177,000 in non-compliant contributions at the provincial level and $35,000 at the municipal level. Moreover, a substantial number of investigations are currently being carried out by the institution with regards to financing.

The fact that contributions made at the provincial level have been paid directly to the Chief Electoral Officer since May 2011 has allowed the institution to have direct contact with contributors and ensure a prompt start of the verification process. In this regard, between 16% and 20% of contributions have required additional verification, since 2011, for reasons outlined in the report. Furthermore, as a result of the agreement concluded in July 2012 with the Agence du revenu du Québec concerning access to contributors' tax-related information, the office of Chief Electoral Officer created a special investigation unit, which can act upon the verification work and gather the necessary evidence as regards the commission of offences, which could lead to the filing of criminal proceedings.

The 2010 reform has resulted in illegal contributions becoming corrupt electoral practices. To punish these offences, the office of Chief Electoral Officer has five years to initiate proceedings, a deadline that does not appear sufficient to achieve the desired deterrent and exemplary effect. The Chief Electoral Officer therefore recommends that the limitation period be increased from five to seven years. Recent investigations conducted by the office demonstrate the great difficulties of gathering documentary evidence to establish a violation of the law if a period of more than seven years has elapsed since the event in question.

The 2010 reform included another component giving the office of the Chief Electoral Officer new responsibilities, namely supervising leadership campaigns of provincial and municipal political parties. Prior to the amendments to the Act in December 2011, there was no ceiling for contributions collected by candidates, no restrictions for businesses that wished to contribute, nor any obligation to disclose information about contributions received or expenses incurred. Since the entry into force of the new provisions, provincial political parties have held five leadership campaigns.

Countering the use of straw man schemes

The strengthening of the principle according to which a contribution can only be made by an elector, and the introduction of a mandatory and explicit contribution slip that every elector must complete, should ensure better compliance with rules and help make people who contribute to a political party or an authorized independent candidate more accountable. Moreover, the decline over three years of the maximum allowed contribution from $3,000 to $100, at the provincial level, and from $1,000 to $300 at the municipal level, should make it more difficult to carry off the straw man practice. We should also mention that new offences were added to the legislation and that the penalties found therein, including fines, are much stiffer now.

To achieve greater transparency, the rules governing contributions can, however, be improved with respect to the circulation of cash. In this regard, the office of Chief Electoral Officer proposes a ceiling of $20 as the maximum amount an elector can give in cash for each contribution to an authorized political entity, both at the provincial and municipal level. The prohibition of anonymous contributions and the obligation to consider the cover charge for a financing activity as a political contribution, along with the abolition of the tax credit for political contributions at the provincial level, should help counter the straw man practice and eradicate hidden financing.

At the provincial level: a decrease in election expenses and an increase in public financing

The 2012 reform led to a 30% reduction in the maximum allowed election expenses, the idea behind this measure being mainly to reduce the financial needs of the provincial political parties. Analyses by the office of Chief Electoral Officer have however shown that the increase in these needs has especially been caused by the election of minority governments and the holding of four general elections in seven years between 2007 and 2014. A review of election expenses over fifteen or so years has in fact shown a downward trend in the amount of money being spent by political parties compared to the legal limit.

Another highlight of the reforms adopted since 2010 has been a significant increase in the public financing of provincial political parties to compensate for a decrease in the maximum allowed contributions by electors. The allowance granted annually to the parties by the office of Chief Electoral Officer was increased by $1.8M in 2011 and by $4.2M in 2013, while the new matching of contributions mechanism resulted in the political parties receiving, last March, a total of $1.9M in regular matching and $530,000 in electoral matching. Looking back, the proportion of public financing represented 18.4% of the total revenue of parties in 2009 while it increased to 73% in 2013. 

At the municipal level: the necessity to continue the financing reform

The holding of municipal general elections in November 2013 led the National Assembly to adopt a" transitional" reform of financing and election expenses. According to the Chief Electoral Officer, the National Assembly needs to establish a permanent funding arrangement based on the system in place at the provincial level, in order to ensure adequate financing for political parties and independent candidates. In this regard, the office of Chief Electoral Officer has drawn up a series of proposals for municipalities with a population of 5,000 or more concerning, in particular, political contributions, rules on the reimbursement of election expenses, support for parties and candidates by the municipalities, and the establishment of mechanisms for public financing. The Chief Electoral Officer has reiterated her recommendation that municipalities with a population of under 5,000 be subject to a simplified system of political financing and control of election expenses.

The report released today by the office of Chief Electoral Officer includes a total of 10 recommendations that can serve as the basis for legislative changes.

The Rapport sur la mise en œuvre de la réforme des lois en matière de financement politique et de contrôle des dépenses électorales (report on the implementation of the reform of the legislation governing political financing and the control of election expenses) is available on the website of the Chief Electoral Officer at www.electionsquebec.qc.ca.

SOURCE: Directeur général des élections

Sonia Fontaine, Information Officer, (418) 644?3320 or 1-888-870-3320, [email protected]