2012 FDA Global Electoral Finance
Audit of Canada‟s 10 Provinces
Executive Summary
The FDA audit entailed a comprehensive ...
Prepared By
Mr. Stephen Garvey, Executive Director Foundation for Democratic Advancement, Bachelor of Arts
in Political Sc...
raise public awareness by initiating and leading change through report research and analysis. Please
contact the FDA at (4...
Table of Contents
Introduction 6
How to Read the Report 7
Chapter 1: Electoral Finance 9
Alberta 9
Analysis 14
British Col...
References 79
Appendix: Research Methodology 81
FDA Audit Team & Associates 86
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 6
Introduction
The FDA audit ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 7
How to Read the Report
Chap...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 8
Electoral finance
Electoral...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 9
Chapter 1: Electoral Financ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 10
Electoral Finance Transpar...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 11
No Party or Candidate may ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 12
Goods, services or gifts t...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 13
FDA researchers could find...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 14
Is there an effective legi...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 15
parties, no campaign expen...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 16
British Columbia
Tables 2 ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 17
this purpose prior to beco...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 18
receipts etc. of a party, ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 19
Electoral caps on contribu...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 20
candidate, and the new can...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 21
60% of .75 = 0.45
Total sc...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 22
Manitoba
Tables 3 Electora...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 23
Contributions to registere...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 24
In a year, individual cont...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 25
In an area of less than 30...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 26
If a registered party had ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 27
The FDA researchers found ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 28
New Brunswick
Tables 4 Ele...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 29
Registered third parties m...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 30
Electoral caps on contribu...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 31
Election expenses apply to...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 32
D is the total number of v...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 33
0.3823 of .0.5 = 0.1912
Le...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 34
Newfoundland and Labrador
...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 35
Registered parties are req...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 36
Are there caps on contribu...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 37
Research Findings
Newfound...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 38
misconduct. The FDA believ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 39
Nova Scotia
Tables 6 Elect...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 40
Parties must fully disclos...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 41
Third parties must submit ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 42
2761/5000 = 0.534
0.534 of...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 43
Are there public subsidies...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 44
Analysis
Based on the FDA ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 45
Ontario
Tables 7 Electoral...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 46
regarding financial statem...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 47
Affiliated political organ...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 48
Campaign expenditure
Are t...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 49
Research Findings
Ontario'...
Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 50
income, does not regulate ...
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report
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2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report

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Executive Summary

The FDA audit entailed a comprehensive audit of the electoral finance legislation of Canada's 10 provinces. The audit is restricted to capturing systematic corruption. The FDA measured exceptional legislation in Québec and Manitoba, very good in Nova Scotia, acceptable in New Brunswick, unacceptable (passing) in Ontario and Newfoundland and Labrador, and unacceptable (failing) in Alberta, British Columbia, Prince Edward Island, and Saskatchewan. The FDA believes that the legislation from Alberta, British Columbia, Prince Edward Island, and Saskatchewan is systematically corrupt by favouring minority/special interests over the interests of the people. The FDA identified major deficiencies in many areas of these provinces' legislation including the addition of corporations and trade unions in electoral contributions, high caps on contributions, no expenditure limits, public subsidies which favor large, established parties, no regulation of third party expenditure, and/or low fines on corporations and trade unions for electoral wrongdoing. In contrast, FDA auditors measured zero deficiency in Québec's legislation. This measurement means that Québec's legislation is working completely in the interests of the people of Québec. The FDA recommends that the rest of Canada's provinces model their legislation after Québec's.

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2013--Revised 2012 FDA Canadian Provinces Electoral Finance Report

  1. 1. 2012 FDA Global Electoral Finance Audit of Canada‟s 10 Provinces Executive Summary The FDA audit entailed a comprehensive audit of the electoral finance legislation of Canada's 10 provinces. The audit is restricted to capturing systematic corruption. The FDA measured exceptional legislation in Québec and Manitoba, very good in Nova Scotia, acceptable in New Brunswick, unacceptable (passing) in Ontario and Newfoundland and Labrador, and unacceptable (failing) in Alberta, British Columbia, Prince Edward Island, and Saskatchewan. The FDA believes that the legislation from Alberta, British Columbia, Prince Edward Island, and Saskatchewan is systematically corrupt by favouring minority/special interests over the interests of the people. The FDA identified major deficiencies in many areas of these provinces' legislation including the addition of corporations and trade unions in electoral contributions, high caps on contributions, no expenditure limits, public subsidies which favor large, established parties, no regulation of third party expenditure, and/or low fines on corporations and trade unions for electoral wrongdoing. In contrast, FDA auditors measured zero deficiency in Québec's legislation. This measurement means that Québec's legislation is working completely in the interests of the people of Québec. The FDA recommends that the rest of Canada's provinces model their legislation after Québec's. Electoral Fairness Audit Completed April 10, 2012 Revised September 29, 2013
  2. 2. Prepared By Mr. Stephen Garvey, Executive Director Foundation for Democratic Advancement, Bachelor of Arts in Political Science, University of British Columbia and Master of Philosophy in Environment and Development, University of Cambridge. Purpose of the Canadian Provinces Electoral Finance Audit The purpose of the Foundation for Democratic Advancement (FDA)‟s electoral finance audit (the Audit) is to determine a comprehensive grade for electoral finance in Canada at the provincial legislative level of government. This Audit is an extension of the FDA‟s global audit of electoral fairness involving all countries that hold political elections. The purpose of the global audit is to quantify electoral fairness, establish benchmarks for electoral fairness, identify areas of democratic advancement and progression, and encourage democracy reform where needed. The goal of the FDA's provincial report is to give the people of Canada and other stakeholders an informed, objective, comparative perspective of the Canada's provincial electoral systems and provide recommendations for reform of the systems where needed. Canadians may want to use this information as a way to help determine their electoral choices in upcoming provincial elections. The release of the FDA province report just prior to the 2012 Alberta Election coincides with this initiative. The views in this electoral finance audit are the views of the FDA only. The FDA‟s members are in no way affiliated with any of the provinces' election administrators or any of the provinces' registered/nonregistered political parties. The Audit is an independent assessment based on objectivity, transparency and non-partisanship. The FDA assumes no responsibility or liability for any errors in the measurement and calculation of its audit results or inaccuracies in its research of relevant provincial legislation. About the Foundation for Democratic Advancement The Foundation for Democratic Advancement (FDA) is an international independent, non-partisan democracy organization. The FDA‟s mission is to measure, study, and communicate the impact of government processes on a free and democratic society. Overall,the FDA works 1. to ensure that people become more knowledgeable about the outcomes of government processes and can then make decisions that are more informed; 2. to get people involved in monitoring government processes at all levels of government and in providing sound, practical, and effective suggestions. (For more information on the FDA visit: www.democracychange.org) To ensure its objectivity and independence, the FDA does not conduct privately paid research. However, if you or your organization has an important research idea or are aware of an important issue on government processes, the FDA is available to listen to your idea or issue and possibly help
  3. 3. raise public awareness by initiating and leading change through report research and analysis. Please contact the FDA at (403) 669-8132 or email us at info@democracychange.org for more information. An online version of this report can be found at: www.democracychange.org For further information and/or comments on this report please contact Mr. Stephen Garvey at stephen.garvey@democracychange.org
  4. 4. Table of Contents Introduction 6 How to Read the Report 7 Chapter 1: Electoral Finance 9 Alberta 9 Analysis 14 British Columbia 16 Analysis 21 Manitoba 22 Analysis 27 New Brunswick 28 Analysis 33 Newfoundland and Labrador 34 Analysis 37 Nova Scotia 39 Analysis 44 Ontario 45 Analysis 49 Prince Edward Island 51 Analysis 54 Quebec 56 Analysis 63 Saskatchewan 64 Analysis 68 Chapter 2: Overall Audit Results 69 Chapter 3: Analysis 70 Chapter 4: Conclusion ` 76 Chapter 5: Recommendations 78
  5. 5. References 79 Appendix: Research Methodology 81 FDA Audit Team & Associates 86
  6. 6. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 6 Introduction The FDA audit of the Canadian provinces' electoral finance legislation is based on non-partisanship and objectivity. The audit process entails three major components: 1. Research of the provinces' electoral legislation. 2. Audit of the legislation based on audit team consensus, and FDA matrices and scoring scales. 3. Analysis of findings. The value of scores in the FDA matrices are based on fundamental democratic principles of legislative neutrality, political freedom, and political fairness, and the comparative impact of variables on democracy. For example, if there is no electoral finance transparency then this result will impact other sections such as the legislative process, because without financial transparency, it will be difficult to enforce electoral finance laws and prevent and discover electoral finance wrongdoing. Consequently, according to the FDA scoring system, zero financial transparency will result in a zero score for legislative process as well. The FDA research component is objective, because it is simply a compilation of the same legislative and financial data for each province. The FDA audit component is both objective and subjective. It is objective when determining yes and no facts, such as does Province A have caps on electoral contributions—yes or no? It is subjective because of the predetermined scores for each audit section, and the scores given for each section. The FDA acknowledges that there is no absolute scoring system. The FDA minimizes subjectivity through non-partisanship, the predetermination of scores based on consensus of FDA auditors, the application of core democratic concepts such as the neutrality of electoral legislation, political freedom, and political fairness, and the valuation of the comparative impact of variables on democracy. In addition, the FDA has a minimum quorum of five experienced auditors during audit sessions. For further discussion of the FDA methodology please see the Research Methodology chapter on page 81.
  7. 7. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 7 How to Read the Report Chapter 1 focuses on the FDA‟s electoral finance audit of the Canada‟s 10 provinces. These chapters are formatted in the following manner 1) Introduction to the audit. 2) Summary for audit results for each province. 3) Audit questions, legislative research and audit findings on each province. 4) Analysis of audit measurements and findings for each province. Chapter 3, „Overall Analysis‟, pertains to the measurements and findings from the audit results and findings for each province. Definition of Key Terms The Foundation for Democratic Advancement characterized the following definitions Electoral fairness The impartiality and equality of election law before, during, and after an election period. In the context of the audit, electoral fairness involves concepts relating to election content in the media, candidates and parties, electoral finance, and voters. In particular, this includes evaluating impartiality and balance of political content in the media, equitable opportunity and ability for registered candidates and parties to influence voters and government, equitable electoral finance laws, and equitable opportunity and ability for voters to voice political views and/or influence the outcome of an election. Electoral fairness does not allow bias through, for example, legislation that gives a distinct electoral advantage to one registered party over another, or laws that allow equitable access to media without facilitating equal opportunity to take advantage of this access. In contrast, electoral fairness would include a broad, balanced diffusion of electoral propaganda by registered political parties during the campaign period, equal campaign finances (beyond equal expenditure limits) for all registered parties according to the number of candidates endorsed, and the registration of parties based on reasonable popular support (rather than financial deposit or unreasonable popular support). Electoral fairness in any democratic process must include an equal playing field for registered parties and candidates, distinguishable by voters according to a clear political platform, and a broad and balanced political discourse in where information about electoral choices are clear and available to the voting public.
  8. 8. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 8 Electoral finance Electoral finance laws applied to registered candidates and parties before, during, and after an election period. Electoral finance also encompasses campaign finance which is restricted to the campaign period. In the context of the FDA electoral fairness audit, electoral finance includes: 1) Caps on electoral contributions (or the lack of). 2) Caps on candidate and party electoral expenditures (or the lack of). 3) Procedures for financial disclosure and reporting of candidate and party electoral finances. 4) Procedures for the handling of electoral contributions by registered candidates and parties. Electoral finance does not include non-financial laws, regulations, procedures etc. such as those relating to candidate and party access to media, civil rights laws such as freedom of speech and assembly, rules on right of reply in the media, laws on the election content of media, and laws on voter assistance. Special interest-based democracy A system in where either individual or corporate interests dictate government action, and factions with the most economic and political power in society influence policies and legislation. The electoral system is set up to allow special and minority interests to impact election outcomes primarily through electoral finance and media access and exposure. In addition, people do not have substantial political say on government policy and legislation between elections. People-based democracy A system where political power is invested in the people and the population as a whole to influence government policies and legislation. The electoral system is set up in a fair and equitable manner so that all people, within reason, have an opportunity to influence the election outcomes to the same degree. In addition,people have mechanisms for substantial political say on government decision- making, policies, and legislation between elections.
  9. 9. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 9 Chapter 1: Electoral Finance This chapter focuses on Canadian provincial electoral finance laws and the FDA's audit of them in terms of electoral fairness. Based on the political concepts of egalitarianism and political liberalism, the FDA team audits electoral finance laws according to their equity for registered candidates, parties, and voters (see Appendix: Research Methodology for further explanation). The FDA team audits from the standpoint of a peoples-based democracy. The FDA focuses on six finance variables: electoral finance transparency, contributions to candidates and parties, caps on contributions to candidates and parties, campaign expenditure limits, caps on third-party expenditures, and legislative process for electoral finance. The FDA chose these finance variables because they represent core areas of electoral finance.The audit of electoral finance includes examination of Canadian provincial electoral finance legislation and the application of legislative research to the FDA matrices. Matrix scoring is based on an overall score of 0 to 10 out of 10. What follows are the audit results and questions, legislative research, and audit findings for each province: Alberta Tables 1 Electoral Finance Audit Scores and Percentages for Alberta Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight Alberta Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.0 66.6% Caps on Contributions to Candidates & Parties 20% 2.0 1.0825 54% Campaign Expenditure Limits 22.5% 2.25 0.0 0.0% Caps on Third-party Expenditures 12.5% 1.25 0.2794 22.35% Legislative Process 10% 1.0 0.40 40% Total 100% 10 4.76 47.6%
  10. 10. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 10 Electoral Finance Transparency Are candidate and party finances transparent to the public? Legislative Process The Chief Electoral Officer may examine all financial statements and affairs of all political candidates, election campaigns and registered third parties (Election Finances and Contributions Disclosure Act, Article 4). All records must be maintained for a period of at least three years (Election Finances and Contributions Disclosure Act, Article 10.1). All documents filed with the Chief Electoral Officer are public records and available upon request during normal business hours (Election Finances and Contributions Disclosure Act, Article 11). Any campaign funds not used are held in trust, to be used during the next election. These funds may be transferred to the registered party that supported the candidates bid for election in the previous election. If the candidate is not nominated for the following election, he is to transfer these funds to the registered party or candidates that supported his bid in the previous election. If funds cannot be transferred, they are transferred to the Crown (Election Finances and Contributions Disclosure Act, Article 12). All contributions must be deposited in the account registered with the Chief Electoral Officer (Election Finances and Contributions Disclosure Act, Article 14). Every candidate, constituency association and political party must have a chief financial officer who is not eligible for election and is appointed prior to the party registering with the Chief Electoral Officer. Contributions may only be accepted by the chief financial officer or another person who is deemed authorized to accept contributions, according to the records of the Chief Electoral Officer (Election Finances and Contributions Disclosure Act, Article 29, 31). A third party must register if it has or plans to incur expenses of $1,000 or more, or makes advertising contributions of $1,000 or more (Election Finances and Contributions Disclosure Act, Article 9.1). Contributions to Candidates and Parties Are contributions restricted to citizens? Are contributions disallowed by foreigners, public institutions, and charities? Are anonymous contributions set at a reasonable level? Research Findings
  11. 11. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 11 No Party or Candidate may accept contributions unless they are registered. Requirements: must be non-profit, funds must be deposited within a financial institution in a registered account, must file a report of contributions and expenditures at the end of each tax year (before April 1) (Election Finances and Contributions Disclosure Act, Article 6). No contributions to registered parties, constituency associations, and candidates from non- Alberta corporations and trade unions, public post-secondary institutions, prohibited corporations, school boards, Métis settlements, municipalities, and provincial corporations (Election Finances and Contributions Disclosure Act, Definition of prohibited corporation). No contribution of funds may be made if said funds do not belong to the contributor or originate out of province. During a campaign period, a provincial party may accept a maximum $150 per candidate from a registered federal political party (Election Finances and Contributions Disclosure Act, Articles 34, 35, 36). Anonymous contributions are not allowed in excess of $50. Those in excess must be returned to the contributor. If this cannot happen, it must be paid into the general revenue fund through the Chief Electoral Officer (Election Finances and Contributions Disclosure Act, Article 21.1). Caps on Contributions to Candidates and Parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaigns? Are the caps on candidates own contributions reflective of mean total income? Research Findings Alberta's 2009 mean total income is $35,250 (Statistics Canada, 2011). In any year contributions may not exceed $15,000 for a registered party and $1,000 for a registered constituency association (only during a campaign period) and $5,000 in aggregate for registered constituency associations of each registered party (Election Finances and Contributions Disclosure Act, Article 17). In any campaign period, contributions may not exceed $30,000 to registered parties less any contributions made that calendar year, and $2,000 to any registered candidates (only during a campaign period) and $10,000 in the aggregate to registered candidates of each registered party (Election Finances and Contributions Disclosure Act, Article 17). Contributions to a candidate may only be made during an election period (Election Finances and Contributions Disclosure Act, Article 17). No party or candidate may knowingly accept contributions greater than these limits (Election Finances and Contributions Disclosure Act, Article 19).
  12. 12. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 12 Goods, services or gifts that do not exceed $50 are not considered contributions, and are not to be transferred, but are recorded under the gross amount (Election Finances and Contributions Disclosure Act, Article 12). Contributions other than money must be valued at market value at the time of the election (Election Finances and Contributions Disclosure Act, Article 44.31). The unanimous decision of the FDA audit team is that 10% of personal mean income is a reasonable limit to contribute to candidates and parties. 10% of average income is $3,525. The maximum contribution is $40,000. 3525/40000 = .0881 0.0881 out of 1.0 (FDA Audit Team, 2012). Registered candidates own contributions to their own campaigns are subject to the contribution limits to registered candidates ($2,000 limit) (Election Finances and Contributions Disclosure Act, Article 17). Based on the 2009 Alberta mean total income of $35,250 (Statistics Canada, 2011), the FDA auditors think that $2,000 is a reasonable limit on contributions by candidates to their own campaigns. The FDA auditors believe that candidates would likely be more willing to contribute to their own campaigns than to others, and that if candidates did not have personal financial resources to cover the $2,000 limit, they have the opportunity to raise electoral monies through contributions from citizens and corporations and fund raising events. Further, a $2,000 difference in campaign contributions by candidates, for example, will likely not determine the election results for a particular constituency (FDA Audit Team, 2012). Campaign Expenditure Limits Are there campaign expenditure limits on candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? Research Findings There are no electoral expenditure limits on registered candidates and parties (FDA researchers could find no Alberta legislation that placed direct limits on electoral expenditures). In contrast, the Canadian federal electoral system has candidate expenditure limits on each constituency based on location and size of population, and expenditures limits on political parties based on the number of candidates endorsed by each party (FDA Electoral Fairness Audit of Canada, Electoral Finance, 2011).
  13. 13. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 13 FDA researchers could find no legislation on public subsidies, ergo, conclude that there are no provincial subsidies of candidates, parties, or third parties. Caps on Third Party Spending Are there caps on third party spending? If there is third party spending, is it restricted to citizens only? If there are caps on third party spending, are they attainable, reasonably, by all adult citizens? Are there public subsidies or other financial instruments that create an equal level of third party spending? Research Findings Alberta's 2009 mean total income is $35,250 (Statistics Canada, 2011). Third party expenditure is limited to $15,000 in one calendar year and $30,000 in year of an election less any expenditure made that year (Election Finances and Contributions Disclosure Act, Article 44.2(3)). Those who may not register as a third party are: individuals that are not permanent residents of Alberta; corporations that do not carry out business in Alberta; registered charities; prohibited corporations; and trade unions or organized labor groups not defined by the Election Finances and Contributions Disclosure Act (Election Finances and Contributions Disclosure Act, Article 9.1). No advertising contribution may be made or used unless it is by someone registered as a third party and subject to the same limits (Election Finances and Contributions Disclosure Act, Article 44.2). The FDA assumes that all corporations and unions can afford the $30,000 expenditure. $30,000 limit on third party expenditure in election year. 10% of income equals 3,525. 3525/30000 = .1175 0.1175 out of .25 (max score) = 0.0294 (FDA Audit Team, 2012). There are no provincial subsidies of candidates and parties, and third parties (FDA researchers could find no legislation on public subsidies). Legislative Process Is legislative process to enforce the electoral finance laws?
  14. 14. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 14 Is there an effective legislative process to enforce electoral finance laws? Research Findings Alberta has comprehensive laws and regulations for the enforcement of the Alberta Election Act. There are established fines and persecution through the Provincial Courts that covers both offenses and violations to the Election Act and electoral corruption. However, the Chief Electoral Officer is only person who has the power to proceed with prosecution under the Election Act (Election Act, Articles 154-184). The maximum fine for contraventions for registered parties is $10,000 and $1,000 for registered candidates and constituency associations. The maximum fine for a general offence is $10,000 for corporations and trade unions, and $1,000 for individuals. Maximum fines for third party advertising violations are $10,000 for an individual and $100,000 for corporations and unions. There are no prison sentences for electoral infractions in Alberta. (Election Finances and Contributions Disclosure Act, Articles 4553). Based on low general fines of $10,000 for corporations (except for third party fines), low fines for registered candidates and individuals, and no prison sentences, the FDA auditors determine a 20% score. (The FDA auditors assume that a fine $200,000 and/or 1 or more years imprisonment is effective against corporations, and $5,000 fine and/or 1 or more years imprisonment is effective against individuals). 20% of .75 = .15 The Court may order parties to bear their own costs for an appeal and/or recount. Depending on the situation, costs may be paid by the Crown in right of Alberta (Election Act, Article 148.1). Finances Act does not apply to leadership conventions within political parties (Election Finances and Contributions Disclosure Act, Article 2). Finances Act does not apply to leadership conventions within political parties (Election Finances and Contributions Disclosure Act, Article 2). Total score for the electoral fairness of electoral finance: 47.6 percent out of 100 percent. Analysis Based on the FDA scoring scale (see the Conclusion chapter), Alberta is in the failing zone for fairness of electoral finance legislation. The scores reflect systematic corruption in Alberta‟s electoral finance legislation. Systematic corruption refers to legislated public processes that favour minority interests over the interests of people as a whole. Barring electoral finance transparency and reasonable caps on contributions to candidates, Alberta‟s electoral finance legislation favours the wealthy segments in society. The inclusion of corporations and trade unions in electoral contributions and third party spending, high caps on contributions to
  15. 15. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 15 parties, no campaign expenditure limits, high third party expenditure limits, and ineffective penalties against corporations and trade unions is evidence of this fact. Québec, which attained a 100 percent score for electoral finance legislation, provides an example and model of electoral finance legislation that reflects the interests of people as a whole. In Québec, unlike Alberta, contributions and third party expenditure is limited to the electorate, the Court imposes effective fines for corporate contraventions, and there are reasonable caps on contributions and expenditures for parties and candidates.
  16. 16. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 16 British Columbia Tables 2 Electoral Finance Audit Scores and Percentages for British Columbia Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight British Columbia Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 0.5 33.3% Caps on Contributions to Candidates & Parties 20% 2.0 0.25 12.5% Campaign Expenditure Limits 22.5% 2.25 1.25 50% Caps on Third-party Expenditures 12.5% 1.25 0.25 20% Legislative Process 10% 1.0 0.65 65% Total 100% 10 4.91 49.10% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidate and parties and not the public? Are candidate and party finances only transparent to the government? Legislative Process Parties and constituency organizations must register to incur election expenses (Election Act, Article 154). Donations of money and the value of goods and services to parties and constituency associations, as well as to candidates, leadership contestants and nomination contestants where it is to be used for their campaign, are considered contributions (Election Act, Article 180). Loans that are write-offs, forgiven, or unpaid six months past their due date without legal action by the creditor are considered contributions. In the case of loans given at less than the prime rate of interest, the difference between the interest charged and that expected by the prime rate is considered a contribution (Election Act, Article 181). Election expenses include expenses used to promote or oppose, through direct or indirect means, the election of a candidate or a party. This includes expenses used for
  17. 17. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 17 this purpose prior to becoming a candidate and any deficit incurred from a fundraising function. Election expenses are nomination expenses in excess of 10% of total election expenses. Nomination expenses less than this amount and personal election expenses, such as family care, travel and lodging costs or disability expenses, are not considered election expenses (Election Act, Article 183). Registered political parties, constituency associations, candidates and leadership contestants must have a financial agent. Financial agents can serve more than one individual or group (Election Act, Article 175). The financial agent must maintain records of all contributions, expenses and loans incurred by the individual or group they represent for five years. The financial agent must also document the particulars of expenditures greater than $25 and ensure that an appropriate financial institution handles all money received or spent by the person or organization (Election Act, Article 177). All registered parties, registered constituency associations and candidates must appoint an auditor. Auditors may serve more than one individual or group (Election Act, 179). The financial agent must record a contribution's value, date of contribution, contributor name, address and classification. For those donating more than $250 the record must indicate contributor names, classification, and date and amount of the contribution. For anonymous contributions, the agent must report a description of the function at which they were collected, its date, the number of people in attendance, and the total anonymous amount accepted. For any other contributions, the total amount and number of contributors must be reported (Election Act, Articles 190 and 206). Financial agents must provide records for each candidate to their political party within 60 days of polling. They must also provide records for a constituency association to their party by February 15 of the following year (Election Act, Article 191). The chief financial officer for a party or constituency organization must file a financial report with the Chief Electoral Officer by March 31 regarding finances of the previous year for the parent organization and any subsidiary organizations. This report must include all of that year's political contributions, assets, liabilities, receipts and loans. The report must also include contributions to one or more members of a party, its constituency associations and its candidates if the total is greater than $250 (Election Act, Articles 206 and 207). A candidate must provide a personal expenses report within 60 days of polling to a financial agent, provided the candidate is not acting as his or her own financial agent (Election Act, Article 208). A candidate's financial agent must file a report with the Chief Electoral Officer within 90 days of the election. The report must contain election expenses, contributions, receipts and income, and is available for public viewing at the office of the Chief Electoral Officer during regular office hours for one year following the election (Election Act, Article 209). The financial agent of a party or constituency association must file a report for the party or constituency association, and any subsidiary organizations with the chief electoral officer within 90 days after the polling day. The report must detail the expenses, contributions, tax
  18. 18. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 18 receipts etc. of a party, constituency association, and any subsidiary organizations incurred between December 31 of the previous year and the end of the campaign period (Election Act, Article 210). If the financial agent discovers that information disclosed in any report has changed or is inaccurate or incomplete, s/he he must file a supplementary report, subject to the same requirements as the report it supplements, with the Chief Electoral Officer within 30 days of discovery (Election Act, Article 212). For all reports required by the British Columbia Election Act, the auditor of the party, constituency association or candidate must make a report to their respective financial agent, using accepted auditing standards to ensure that the report follows typical accounting practices. The financial agent must grant the auditor access to financial records deemed necessary for their audit (Election Act, Article 214). Following the election, the Chief Electoral Officer must publish a report summarizing political financing, including the information from election financing reports, election expenses limits, advertising disclosure reports, as well as a list of all individuals and groups who did not file the necessary reports, filed reports late, or exceeded election expenses limits (Election Act, Article 215). Independent sponsors incurring expenses greater than $500 during, or 60 days before, the election period, must file a report with the Chief Electoral Officer that outlines contributions, the value of advertising and the sponsor's assets. The records are retained at the office of the Chief Electoral Officer for no less than five years and are available for public inspection during regular office hours (Election Act, Articles 244,245 and 250). Electoral contributions to candidates and parties Are electoral contributions restricted to citizens? Are electoral contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral contributions set at a reasonable level? Research Findings British Columbia's 2009 mean total income is $27,970 (Statistics Canada, 2011). Contributors can include individuals, corporations, unincorporated businesses, trade unions and non-profit organizations (Election Act, Article 190). Unregistered political parties, unregistered constituency associations, parties registered by the Canada Elections Act and charities cannot make political contributions. Contributions must be made from one's own funds. (Election Act, Articles 186 and 187). Anonymous contributions can only be collected as part of a fundraiser specifically related to the purpose of the group or individuals running it. Anonymous contributions are limited to $50 and may total no more than $10,000 for a party or $3,000 for a candidate in a calendar year (Election Act, Articles 186 and 188).
  19. 19. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 19 Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings British Columbia's 2009 mean total income is $27,970 (Statistics Canada, 2011). Anonymous contributions can only be collected as part of a fundraiser specifically related to the purpose of the group or individuals running it. Anonymous contributions are limited to $50 and may total no more than $10,000 for a party or $3,000 for a candidate in a calendar year (Election Act, Articles 186 and 188). FDA researchers found no other caps on contributions. Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings A candidate, party, constituency association, or any of these in cooperation with a third party must not incur expenses if they will result in exceeding the expense limit (Election Act, Article 196). For general elections and by-elections, the Chief Electoral Officer must adjust election expense limits in accordance with a consumer price index. S/he will publish these limits in the Gazette and inform the candidates, parties and constituency associations of the changes (Election Act, Article 204). For general elections, the total election expenses incurred by a registered political party must not exceed $1.1 million for the 60 days prior to the campaign period and $4.4 million during the campaign period. If the campaign period is extended due to the death of a candidate, election expenses for that district are increased by $70,000 (Election Act, Article 198). For all elections, prior to and during a campaign, the total election expenses incurred by a candidate must not exceed $70,000. If the campaign period is extended due to the death of a
  20. 20. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 20 candidate, and the new candidate is nominated prior to new election proceedings, the expenditure limit is $140,000. If the candidate is nominated after election proceedings, the expense limit is $70,000 (Election Act, Article 199). The FDA researchers found no public subsidizing of parties or candidates. Electoral caps on third parties Are there caps on third party electoral spending? If there are caps on third party spending, are they restricted to citizens? If there are caps on third party spending, are they attainable, reasonably, by citizens? Are there public subsidies or other financial instruments that help create an equal level of third party spending? Research Findings Third party spending by individuals or organizations on advertising for a general election may not exceed $3,000 for a single district, or $150,000 overall, for a single individual, group, or by a collective, for the period 60 days before the campaign period to the end of the campaign. For a by-election, spending may not exceed $3,000 (Election Act, Article 235.1) $150,000 maximum expenditure for third parties. 10% of income = $2,797. 2,797/150000 = 0.0186. 0.0186 out of .5 = 0.0093. The FDA researchers did not find public subsidizing measures for third parties. Legislative process Is legislative process to enforce the electoral finance laws? Is there an effective legislative process to enforce electoral finance laws? Research Findings The British Columbia Election Act outlines contraventions to the Act and the corresponding punishments, including fines as high as $20,000, two years imprisonment, or both, though usually a $10,000 fine, one years imprisonment or both (Election Act, Article 251-267). The FDA auditors assume that $200,000 is a minimum effective fine against corporations and trade unions, and $5,000 against individuals. The FDA auditors deducted 40% of the score for low fines against corporations and trade unions, in consideration of the high fines against individuals and lengthy prison sentences.
  21. 21. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 21 60% of .75 = 0.45 Total score for the electoral fairness of electoral finance: 49.1 percent out of 100 percent. Analysis Based on the FDA scoring scale (see Conclusion section), British Columbia received a failing score for its electoral finance legislation, which means that British Columbia's electoral finance legislation is systematically corrupt. Systematic corruption refers to legislated public processes that favour minority interests over the interests of the majority. Despite electoral finance transparency and expenditure limits, British Columbia‟s legislation is biased. This is evident in the inclusion of corporations and trade unions in electoral contributions and third party spending, no caps on contributions, no public subsidies to help create an equal playing field for candidates and parties, high caps on third party expenditures, and low fines against corporations and trade unions for electoral misconduct. The FDA believes that British Columbia‟s political establishment favours wealthy segments of British Columbia and large, established political parties, and functions at the expense of British Columbians as a whole.
  22. 22. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 22 Manitoba Tables 3 Electoral Finance Audit Scores and Percentages for Manitoba Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight Manitoba Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.5 100% Caps on Contributions to Candidates & Parties 20% 2.0 1.9493 97.46% Campaign Expenditure Limits 22.5% 2.25 2.25 100% Caps on Third-party Expenditures 12.5% 1.25 0.0 0.0% Legislative Process 10% 1.0 0.8125 81.25% Total 100% 10 8.512 85.12% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidate and parties and not the public? Are candidate and party finances only transparent to the government? Research Findings Registered parties are required to keep a designated bank account (Elections Finances Act, Article 10). The Chief Electoral Office can request financial information from registered parties, candidates, constituency associations, and third parties. They have 30 days to comply with the request (Elections Finances Act, Article 57 (2)). Registered parties and candidates, constituency association organizations, and third parties must preserve their financial records for at least 5 years from date of filing, and maybe longer if the Chief Electoral Officer requests an additional period (Elections Finances Act, Article 58). Within 3 months of the end of each year, registered parties must submit audited financial statements to the Chief Electoral Officer (Elections Finances Act, Article 59). Contributions to individuals must include record of contributor's name and residential address, date received, amount, and name of person collecting or receiving it. For contributions over $100, the record must include the contributor‟s signature (Elections Finances Act, Article 37.2(1)).
  23. 23. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 23 Contributions to registered candidates, parties and constituency associations must include a record of the contributor's name and residential address, date received, amount, and name of person collecting or receiving it. For contributions over $100, the record must include the contributor‟s signature (Elections Finances Act, Article 37.3). All electoral financial documents, statements, reports, receipts, invoices etc. filed with the Chief Electoral Officers are public information, and the public may inspect and copy them (Elections Finances Act, Articles 70(1)-70(2)). Electoral contributions to candidates and parties Are electoral contributions restricted to citizens? Are electoral contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral contributions set at a reasonable level? Research Findings Only individuals who are normally residents of Manitoba can contribute (Elections Finances Act, Article 37.1(1)(a)). Only individuals who are normally residents of Manitoba can receive contributions from another individual (Elections Finances Act, Article 37.1(2)). Anonymous contributions cannot exceed $10 (Elections Finances Act, Article 42). Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings Manitoba's 2009 mean total income is $28,480 (Statistics Canada, 2011). In a year, an individual can make two contributions in kind with a market value of less than $20 to the same registered candidate, party, and constituency association and the law does not consider those donations contributions. Any subsequent donations in the same year the law does consider a contribution (Elections Finances Act, Article 40.1 (1)). Electoral law considers contributions in the form of goods and services at market value at the time of the donation (Elections Finances Act, Article 40 (1)).
  24. 24. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 24 In a year, individual contributions are limited to $3,000 to any combination of candidates, constituency associations, registered parties, and leadership contestant (after the leadership contest ends) (Elections Finances Act, Article 41(1.1)) Individuals cannot contribute more than $3,000 to one or more leadership contestants during a leadership contest period (Elections Finances Act, Article 41(1.1.1)). Individuals cannot contribute through monies received on behalf or from other individuals or organizations (Elections Finances Act, Article 41(1.2)). Electoral law considers loans to registered parties, candidates, and constituency associations a contribution if the interest rate is less than prime, with the contribution being the difference between rates (Elections Finances Act, Article 44.1(2)). Loans from an individual or organization to registered parties, candidates, and constituency associations are limited to $3,000 in a calendar year (Elections Finances Act, Article 44.1(3.2)). Maximum contribution is $3,000. 10% of mean income is $2,848. (The FDA auditors assume that income earners can spend reasonably 10% income on contributions.) 2948 of 3000 = 0.9493 Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings In 2010, Manitoba's per capita income for individuals is $29,840 (Manitoba Bureau of Statistics, 2011); in 2007, the top 20% of earners had 8.1 times more income than the bottom 20% of earners (Statistics Canada, 2011). Registered parties during a general election cannot have electoral expenses that exceed $1.79 times the number electors on the voting lists in which the party endorses candidates (Elections Law, Article 50(1)(a)). Registered parties during a by-election cannot have electoral expenses that exceed $3.22 times the number electors on the voting lists (Elections Law, Article 50(1)(b)).
  25. 25. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 25 In an area of less than 30,000 square miles, registered candidates' election expenses cannot exceed $2.72 times the number names on the voter lists for the electoral divisions (Elections Finances Act, Article 51(1)(a)). In an area of greater than 30,000 square miles, registered candidates' election expenses cannot exceed $4.33 times the number names on the voter lists for the electoral divisions (Elections Finances Act, Article 51(1)(b)). Expenditure limits can decrease or increase based on any percentage change in the Consumer Price Index for the City of Winnipeg (Elections Finances Act, Article 52). Advertising expenses in a year of fixed date election and outside of the election period are $250,000 for a registered party and $6,000 for a registered candidate (Elections Finances Act, Article 54.1(1)). In a general election, advertising expenses for a registered party shall not exceed $0.92 times the number of names on the voter lists for all electoral divisions in which party endorses candidates (Elections Finances Act, Article 50(2)(a)). In a by-election, advertising expenses shall not exceed $1.61 times the number of names on the voter lists for all electoral divisions (Elections Finances Act, Article 50(2)(b)). The total advertising expense of a candidate, whether incurred by the candidate, constituency association or individual acting on the candidate's behalf, shall not exceed $0.56 times the number of names on the voters list for the electoral division in which candidate is part of (Elections Finances Act, Article 51(2)). Advertising expenses are part of election expenses (Elections Act, Article 50(3)). Registered parties are entitled to public subsidy each non-election year based on $1.25 times the number of valid votes received by each candidate endorsed by the party in the most recent election. The maximum for said subsidy is $250,000, which is subject to the total expenses paid by the party in the year (Elections Finances Act, Articles 70.2(2)). During an election year, a registered party is entitled to a public subsidy based on the following formula: $1.25 × [(A× B/E) + (C × D/E)] In this formula, A is the number of valid votes received by each candidate endorsed by the party in the general election; B is the number of days in the year after the polling day of the general election; C is the number of valid votes received by each candidate endorsed by the party in the preceding general election; Dis the number of days in the year up to and including polling day of the general election; E is the number of days in the year.
  26. 26. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 26 If a registered party had at least one elected member in the Assembly during the previous election, the minimum allowance payable to that party in an election year is $10,000, or $600 in any other case (Elections Finances Act, Article 70.2(4)). A registered candidate is entitled to receive a public subsidy if the candidate receives at least 10% of all eligible votes cast in the electoral division in which s/he was a candidate (Elections Finances Act, Article 71(1). The public subsidy covers 100% of the following expenses: (i) the reasonable child care expenses incurred by the candidate to enable the candidate to campaign in the election period, (ii) the reasonable expenses incurred by a disabled candidate in relation to his or her disability to enable the candidate to campaign in the election period; and (b) 50% of the actual election expenses, excluding donations in kind, incurred by or on behalf of the candidate, to a maximum of 50% of the total election expense limit of the candidate under subsection 51(1), as varied in accordance with section 52 (Elections Finances Act, Article 71(2)). A registered party is entitled to reimbursement of election expenses if it obtained at least 10% of all valid votes cast in the last election. The amount of the reimbursement is 50% of the actual election expenses, excluding donations in kind, incurred by it or on its behalf, to a maximum of 50% of the total election expense limits (Elections Finances Act, Articles 71(3) and 71(4)). Electoral caps on third parties Are there caps on third party electoral spending? If there are caps on third party spending, are they restricted to citizens? If there are caps on third party spending, are they attainable, reasonably, by citizens? Are there public subsidies or other financial instruments which help create an equal level of third party spending? Research Findings FDA researchers could not find legislation that regulates third party expenditures. Legislative process Is legislative process to enforce the electoral finance laws? Is there an effective legislative process to enforce electoral finance laws? Research Findings The Election Commissioner through his or her own initiative or at the request of another person may investigate any act which violates the Elections Finances Act (Elections Finances Act, Article 77.3(4) to 77.3.1(3)).
  27. 27. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 27 The FDA researchers found extensive legislation that enforces the Manitoba Electoral Finance Act, including up to $50,000 fines against corporations, $25,000 fine against registered parties, and maximum general fine of $5,000 against individuals (The Elections Finances Act, Articles 78-91(5)). The FDA auditors assume that a minimum effective fine against corporations is $200,000, therefore, deducted 50% of the maximum score for low fines against corporations and absence of imprisonment terms. 50% of .75 = 0.5625 Total score for the electoral fairness of electoral finance: 85.12 percent out of 100 percent. Analysis Numerous areas of Manitoba‟s electoral finance legislation stand out, and based on the FDA scoring scale (see Conclusion chapter), Manitoba's score of 85.12 percent is exceptional. This measurement means that Manitoba's electoral finance legislation is highly democratic and puts the interests of the majority in Manitoba above the minority. The FDA measured exceptional legislation in almost all aspects of the Manitoba's electoral law, with the exception of third party expenditure and legislative process. The FDA believes that reasonable caps on third party expenditure and higher fines for corporate electoral misconduct would move Manitoba's score even higher. Unlike Alberta and British Columbia, Manitoba disallows contributions by corporations and trade unions to candidates and parties. However, with no regulation of third party expenditures, corporations and trade unions could have a disproportionate influence on elections outcomes.
  28. 28. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 28 New Brunswick Tables 4 Electoral Finance Audit Scores and Percentages for New Brunswick Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight New Brunswick Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.0 66.6% Caps on Contributions to Candidates & Parties 20% 2.0 1.0863 54.15% Campaign Expenditure Limits 22.5% 2.25 2.25 100% Caps on Third-party Expenditures 12.5% 1.25 0.25 20% Legislative Process 10% 1.0 0.625 62.50% Total 100% 10 7.211 72.11% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidate and parties and not the public? Are candidate and party finances only transparent to the government? Research Findings Contributions from individuals that total more than $100 for a semi-annual period are disclosed to the public (Election Financing Manual). All contributions from corporations and unions are disclosed to the public (Election Financing Manual). Registered political parties, candidates, and district associations must disclose all sources of revenue and expenditures. They must submit financial returns to the Supervisor of Political Financing. Financial returns are available to the public for examination (Election Financing Manual). All third parties are required to disclose their advertisements, which include name and phone number of person who manages books and records, and signed authorization from third parties for advertisements (Election Financing Manual).
  29. 29. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 29 Registered third parties must have a Chief Financial Officer (Election Financing Manual). All third party advertising expenditure books are made available to the public for examination, and details of contributions to third parties over $100 will be made available to the public (Election Financing Manual). Registered parties and candidates must have official representatives and agents who manage electoral finances (Election Financing Manual). Registered parties shall have licensed auditors (accountants practicing in Province) (Political Process Financing Act, Articles 51-57). Registered parties are required to submit two detailed financial returns a year: one for first 6 months and one for last 6 months (Political Process Financing Act, Articles 58-64). Electoral contributions to candidates and parties Are electoral contributions restricted to citizens? Are electoral contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral contributions set at a reasonable level? Research Findings Only individuals, corporations, and trade unions can contribute to registered parties and candidates. Contributions can be made only to registered parties, candidates, and district associations (Election Financing Manual). Corporations that contribute must do business in New Brunswick, and trade unions that contribute must hold bargaining rights in New Brunswick. There is no requirement that individuals who contribute reside in New Brunswick (Election Financing Manual). Corporations are deemed associated if they are controlled by one or related person. Associated corporations can only contribute to one source (Election Financing Manual). Associations and groups cannot contribute. However, individual partners in a partnership may contribute in their own names (Election Financing Manual). Contributions from individuals that total more than $100 for a semi-annual period are disclosed to the public (Election Financing Manual). All contributions from corporations and unions are disclosed to the public (Election Financing Manual).
  30. 30. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 30 Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings New Brunswick's 2009 mean total income is $25,890 (Statistics Canada, 2011). Contributions are limited to $6,000 to each party and any of its district associations per year (Election Financing Manual). Contributions are limited to $6,000 to one registered independent candidate per year (Election Financing Manual). Candidates may incur personal election expenses during the election period up to $2,000. The Province does not reimburse these costs (Election Financing Manual). The maximum contribution is $6,000 per party, and there are five parties in New Brunswick, therefore the maximum contribution is $30,000 (5 times $6,000) 10% of mean income is $2,589 2589 of 30000 = 0.0863 0.0863 of 1.0 = .0863 10% of mean income is $2,589 Maximum candidate contribution is $2,000 2589 of 2000 = 1.2945 Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings
  31. 31. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 31 Election expenses apply to the election period and to all expenditures before an election for literature, objects or materials of an advertising nature (Election Financing Manual). Electoral law does not consider volunteer service that is not part of one's employment a contribution (Election Financing Manual). Election expenses less than $100 incurred by an individual, but not reimbursed to the individual, are not considered election expenses (Election Financing Manual). Registered candidates and parties have expenditure limits. Expenditures other than expenses incurred for advertising on broadcasting in newspapers, periodicals, or other printed matter, are limited to $3,500 per year for registered parties and $2,000 per year for registered district associations and registered independent candidates (Political Process Financing Act, Article 50(1)). During the campaign period, election expenses for registered parties shall not exceed $1.00 times the number of electors in the total number of electoral districts in which the party has candidates. The expenditure limit is set at $7,000 for each by-election (Political Process Financing Act, Article 77(1)). During the campaign period, expenses for registered candidates shall not exceed $1.75 times each elector in the electoral district s/he is a candidate. In no case in a general election shall a candidate's expenditures be limited to less than $11,000 and exceed $22,000. In a by- election, the expense limit for registered candidates is set at $2.00 times each elector in the electoral district s/he is a candidate (Political Process Financing Act, Articles 77(2)-77(3)). Registered candidates receive reimbursement of their election expenses if they receive at least 15% of the votes cast in their electoral district. Candidates who are entitled to receive reimbursement will receive an amount equal to the lesser of: 1. the amount of the election expenses of the candidate or 2. $0.35 for each elector in the electoral district (Political Process Financing Act, Articles 78(1)-78(2)). Registered parties receive an annual allowance if they have representation in the Legislative Assembly or had at least ten official candidates at the preceding general election. The parties receive public monies based on the following formula: (A-B) x (C/D) where A is the amount of the appropriation authorized by the Legislature for making all of the payments which are required under this Act to be made to all of the registered political parties during the fiscal year; B is the total amount paid under section 57 to all registered political parties during the fiscal year; C is the total number of valid votes cast for all of the official candidates of that qualifying political party at the preceding general election; and
  32. 32. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 32 D is the total number of valid votes cast for all of the official candidates of all the qualifying political parties at the preceding general election (Political Process Financing Act, Articles 31-33). Electoral caps on third parties Are there caps on third-party electoral spending? If there are caps on third-party spending, are they restricted to citizens? If there are caps on third-party spending, are they attainable, reasonably, by citizens? Are there public subsidies or other financial instruments which help create an equal level of third-party spending? Research Findings New Brunswick's 2009 mean total income is $25,890 (Statistics Canada, 2011). Individuals, corporations, trade unions, charitable organizations, social groups etc. can spend electorally as third parties (Election Financing Manual). Only third parties that incur expenses over $500 are required register (Election Financing Manual). Third parties expenditures are restricted to 1.3% of the election expenses limit of registered political parties that present a full slate of candidates in the 55 electoral districts. (1.3% of $1.00 times the number of electors in all 55 electoral districts.) (Political Process Financing Act, Article 84.15(1)). In 2010, there were 520,872 electors on the New Brunswick voter list, which means that in 2010, the law capped third party expenditures at $6771.40 (CBC News, “N.B. voter turnout lowest since 1978”, October 1, 2010). Electoral advertising expenses in a single electoral district or a by-election are capped at 10% of the province-wide limit (Political Process Financing Act, Articles 84.15(2)84.15(4)). Third parties can receive contributions from individuals, trade unions, and corporations only (Political Process Financing Act, Article 84.5). 1.3% times number of electors in all 55 districts. In 2011, there were 520,909 electors (2010). 1.3% times 520,909 = 6771.817 10% of mean income = $2,589 2589 of 6771.817 = 0.3823
  33. 33. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 33 0.3823 of .0.5 = 0.1912 Legislative process Is legislative process to enforce the electoral finance laws? Is there an effective legislative process to enforce electoral finance laws? Research Findings Under the Provincial Offences Procedures Act, there are severe penalties in place for violators of the election finance laws. Convictions can result in a fine ranging from $500 to $10,250 and jail terms of not more than 180 days (Election Financing Manual). The maximum fine in New Brunswick is $10,250. The FDA auditors assume that the minimum effective fines against corporations and trade unions are $200,000 and jails times of at least one year according to the offense. Ergo, the FDA auditors deducted 50% from the score. 50% of 0.75 = 0.375 Total score for the electoral fairness of electoral finance: 72.11 percent out of 100 percent. Analysis Based on the FDA scoring scale (see Conclusion chapter), New Brunswick received a satisfactory score for its electoral finance legislation. The score means that New Brunswick's electoral finance legislation is working overall in the better interests of the people of New Brunswick. At the same time, the FDA recognizes there is room to improve the legislation. For example, it believes that corporations and trade unions should be banned from making electoral contributions to candidates and parties, that there should be reasonable caps on third party expenditures, and that the province should increase significantly the fines against corporations and trade unions for electoral misconduct. The FDA assumes that a lack of regulation for third party expenditures may allow wealthy segments of New Brunswick to have a disproportionate influence on election outcomes, and the minimal fines against corporations and trade unions may not be enough to discourage electoral misconduct.
  34. 34. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 34 Newfoundland and Labrador Tables 5 Electoral Finance Audit Scores and Percentages for Newfoundland and Labrador Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight NF Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.0 66.6% Caps on Contributions to Candidates & Parties 20% 2.0 1.0 50% Campaign Expenditure Limits 22.5% 2.25 1.5 66.6% Caps on Third-party Expenditures 12.5% 1.25 0.25 20% Legislative Process 10% 1.0 0.625 62.5% Total 100% 10 5.125 51.25% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidates and parties and not the public? Are candidate and party finances only transparent to the government? Research Findings Parties must disclose to the Chief Electoral Officer the existence of trusts (Election Act, Article 271). On reasonable grounds, the Chief Electoral Officer or representative can inspect books, papers, and records of a candidate or party, enter and search premises, and make copies of documents (Election Act, Article 274). The Auditor General shall audit the financial transactions of the Chief Electoral Officer (Elections Act, Article 276). All documents filed with the Chief Electoral Officer are public records, and may be inspected and copied by the public (Elections Act, Article 277). The names and addresses of electoral contributors and the amount of contributions are recorded by the chief financial officer of each party (Elections Act, Articles 299 (1) and (2)).
  35. 35. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 35 Registered parties are required to record contributors (individually or in sum) and related information who exceed $100 in contributions (Elections Act, Article 299 (3)). During the campaign period, contributions over $100 to candidates or parties must be filed with the Chief Electoral Officer (Elections Act, Article 299 (4)). Publishers of political advertisements must maintain advertisement records for 2 years and relevant information including the cost for advertisements and names of persons who sponsored the advertisement. The records must be made available to the public for inspection (Elections Act, Article 288 (3)). Electoral contributions to candidates and parties Are electoral contributions restricted to citizens? Are electoral contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral contributions set at a reasonable level? Research Findings Only citizens, corporations, and trade unions can make electoral contributions (Elections Act, Article 282 (1)). Corporations must conduct business in the province, trade unions must hold bargaining rights in province, and citizens must be natural persons of the province, whether or not they are residents of Newfoundland and Labrador (Elections Act, Article 282 (2)). Only registered parties and candidates may accept contributions (Elections Act, Article 282 (3)). Contributions in excess of $100 must include the name of the contributor. (Elections Act, Article 282 (5)). Electoral law does not allow anonymous contributions in excess of $100 (Elections Act, Article 283). Contributions must be from the private funds of an individual, corporation, or trade union (Elections Act, Article 285). The FDA auditors assume that charities have to be non-partisan and thereby contribute equally to candidates and/or parties. Therefore, the auditors gave full marks for subsection two. Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income?
  36. 36. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 36 Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings Newfoundland and Labrador's 2009 mean total income is $24,550 (Statistics Canada, 2011). The FDA Researchers found no legislation that places caps on contributions. Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings Newfoundland and Labrador's 2009 mean total income is $24,550 (Statistics Canada, 2011). The election expenses of a registered party must not exceed $3.125 times the number of electors in the electoral district where the party endorses candidates (Elections Act, Article 310 (1)(a)). The by-election expenses of a registered party must not exceed $3.125 times the number of electors in the electoral district where the by-election occurs (Elections Act, Article 310 (1)(b)). The election expenses of candidates shall not exceed $3.125 times the number of electors in the electoral district where s/he is a candidate (Elections Act, Article 310 (2)). Regardless of Articles 310 (1) and (2), no election expenses of a candidate or party shall be limited to an amount less than $12,000 (Elections Act, Article 310 (3)). Election expense amounts in Article 310 are adjusted according to the Consumer Price Index for the 12 month period and dividing the aggregate number by 12 (Elections Act, Article 311). Electoral caps on third parties Are there caps on third party electoral spending? If there are caps on third party spending, are they restricted to citizens? If there are caps on third party spending, are they attainable, reasonably, by citizens? Are there public subsidies or other financial instruments that help create an equal level of third party spending?
  37. 37. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 37 Research Findings Newfoundland and Labrador's 2009 mean total income is $24,550 (Statistics Canada, 2011). The FDA researchers could find no restrictions on independent third party electoral expenditures, other than to identify both the persons buying advertisements and the sponsor of the political advertisement to the publisher (Election Act, Article 288 (2)). Electoral advertisements which have the consent or knowledge of a registered party or candidates that promote or oppose a party or candidate are considered contributions to the relevant party or candidate (Elections Act, Article 288 (1)(a)). Legislative process Is legislative process to enforce the electoral finance laws? Is there an effective legislative process to enforce electoral finance laws? Research Findings The legislation outlines various punishments and fines for electoral offenses. For example, corporations are subject to a maximum fine of $10,000 for violating the Elections Act and individuals are subject to a $1,000 fine or 3 months imprisonment or both for general offences. For exceeding the election expenditure limit or related misconduct, the offender is subject to a maximum fine of $10,000 or 3 months imprisonment or both. Delivering false statements or false receipts carries a maximum fine of $5,000 or 3 months imprisonment or both (Elections Act, Articles 316-327). With a maximum fine of $10,000 and prison time of 3 months, the FDA auditors deducted 50% of the score. The FDA auditors assume the minimum fine for corporations should be $200,000 and minimum prison time of one year. 50% of 0.75 = 0.375 Total score for the electoral fairness of electoral finance: 51.25 percent out of 100 percent. Analysis Based on the FDA scoring scale (see Conclusion section), Newfoundland and Labrador received an unsatisfactory score of 51.25 percent. This score means that Newfoundland and Labrador has numerous deficiencies in its electoral finance legislation and borders on a failed democratic state. The FDA believes that this legislation is not working in the interests of the majority in Newfoundland and Labrador. Although there is electoral finance transparency and campaign expenditure limits, Newfoundland and Labrador does not limit contribution amounts, offer public subsidies, or regulate third parties. It allows contributions from corporations and trade unions and imposes minimal penalties for electoral
  38. 38. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 38 misconduct. The FDA believes that the shortcomings in these areas could undermine a fair and democratic election process in Newfoundland and Labrador. Candidate and party funds might not reflect popular support due to a lack of caps on contributions and allowance for corporate contributions. The absence of third party regulations might allow for wealthy segments of society to have a disproportionate influence on election outcomes.
  39. 39. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 39 Nova Scotia Tables 6 Electoral Finance Audit Scores and Percentages for Nova Scotia Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight Nova Scotia Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.5 100% Caps on Contributions to Candidates & Parties 20% 2.0 1.0513 52.5% Campaign Expenditure Limits 22.5% 2.25 2.25 100% Caps on Third-party Expenditures 12.5% 1.25 0.3168 25.34% Legislative Process 10% 1.0 0.625 62.5% Total 100% 10 7.743 77.43% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidate and parties and not the public? Are candidate and party finances only transparent to the government? Research Findings The Chief Electoral Officer reports to the Assembly after an election (Election Act, Article 163). The Chief Electoral Officer shall retain election documents transmitted pursuant to Article 160 until the appeal has expired, or in accordance with Government Records Act, whichever is longer (Election Act, Article 165). Official agents are responsible for recording contributions and campaign expenditures, issuing tax receipts etc. for candidates, parties, and electoral district associations (Election Act, Article 171). Every party shall have a public accountant who acts as an auditor, and who must adhere to the provided audit and reporting standards or face disqualification (Election Act, Article 177).
  40. 40. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 40 Parties must fully disclose assets in its annual report to the Chief Electoral Officer (Election Act, Article 192). Electoral district associations must fully disclose their assets in an annual report to the Chief Electoral Officer (Election Act, Article 194-198). Candidates, parties, and electoral district associations must deposit all monies in a designated financial institution disclosed to the Chief Electoral Officer (Election Act, Articles 209-212). Electoral law categorizes loans to candidates, parties, and electoral district associations where the difference between a lower interest rate and the prime rate as a contribution (Election Act, Article 215-219). Within 120 days of the end of the fiscal year, a registered party must publish an audited financial statement that is readily available to the public free of charge (Election Act, Article 222). Within 120 days of a by-election or election, a registered party must file a report withthe Chief Electoral Officer that contains all electoral expenses, invoices, receipts, vouchers etc. (Election Act, Article 223). Within 10 days of receiving parties' expense reports, the Chief Electoral Officer will publish of the summary of the reports (Election Act, Article 223). Invoices, receipts, vouchers etc. which are the part of the parties' expense reports are held by the Chief Electoral Officer and s/he shall permit any elector to inspect them (Election Act, Article 223). Electoral district associations must file an annual financial report (Election Act, Article 227). Candidates have 80 days after a by-election or election to file expense reports with the Chief Electoral Officer (Election Act, Article 229). The Chief Electoral Officer will publish a summary of a candidate‟s expense report within 10 days of receiving the report (Election Act, Article 229). The Chief Electoral Officer shall keep invoices, receipts, vouchers from each candidate‟s expense reports for six months, and shall permit any elector to inspect them (Election Act, 229). Candidates must file an annual financial report (Election Act, Article 229). Parties, candidates, and electoral district associations that receive any contribution in excess of $200 must disclose the source of the contribution to the Chief Electoral Officer. The Chief Electoral Officer publishes the information (not including residential addresses) for public viewing (Election Act, Articles 240).
  41. 41. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 41 Third parties must submit an election advertising report to the Chief Electoral Officer that s/he will publish (Election Act, Article 284). Electoral contributions to candidates and parties Are electoral donations/contributions restricted to citizens? Are electoral donations/contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral donations/contributions set at a reasonable level? Research Findings Only individuals who are residents of Nova Scotia can make one or more contributions to registered parties, electoral district associations, registered candidates, or registered third parties (Election Act, Article 236). No organization can contribute to registered parties, candidates, electoral district associations, or registered third parties (Election Act, Article 236). Individuals who are residents of Nova Scotia and are temporarily outside of the province can make one or more contributions to registered parties, electoral district associations, registered candidates, or registered third parties. This provision does not apply to persons who are temporarily away for personal or commercial reasons (Election Act, Article 236). Electoral law does not allow anonymous contributions (Election Act, Article 241). Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings Nova Scotia's 2009 mean total income is $26,710 (Statistics Canada, 2011). Total annual contributions to each registered party cannot exceed $5,000 and total contributions to all electoral district associations and candidates of that party cannot exceed $5,000 (Election Act, Article 236). Total contributions to third parties cannot exceed $5,000 per year (Election Act, Article 236). Candidate contributions to their own campaigns cannot exceed $5,000 per year (Election Act, Article 236). 10% of mean income is $2,671
  42. 42. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 42 2761/5000 = 0.534 0.534 of 1.0 = 0.534 0.534 of 0.5 = 0.2671 Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings A registered party has an expenditure limit based on $2.29 per number of electors in the electoral districts where it presents one or more candidates (Election Act, Article 259). During a by-election, registered parties have an expenditure limit of $5,723.20 (Election Act, Article 259). During an election, a candidate must not exceed the following expenditure limits: $5.72 per elector in any district with up to 5,000 electors $4.86 per elector in any district with more than 5,000 electors and less than 10,000 electors $4.29 per elector in any district with more than 10,000 electors These limits apply to multiple candidates from the same party running in an electoral district. The law views them as one candidate and they can divide the expenditure limit between themselves (Election Act, Article 260). Each fiscal year the province provides registered parties with $1.53 per each vote received in the most recent election (Election Act, 191). Elected candidates and candidates who garner at least 10% of valid votes cast receive $1.43 from the provincial government. Multiple candidates from the same party are viewed a one candidate, and may divide the reimbursement if they qualify (Election Act, Article 267). Electoral caps on third parties Are there caps on third party electoral spending? If there are caps on third party spending, are they restricted to citizens? If there are caps on third party spending, are they attainable, reasonably, by citizens?
  43. 43. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 43 Are there public subsidies or other financial instruments that help create an equal level of thirdparty spending? Research Findings Nova Scotia's 2009 mean total income is $26,710 (Statistics Canada, 2011). Third parties have an expenditure limit of $10,000 during an election (Election Act, Articles 275). No more than $2,000 of third party expenditure can be used to promote or oppose a leadership candidate in a given electoral district (Election Act, Article 275). Individual residents of Nova Scotia and corporations that are registered in Nova Scotia can make third party expenditures (Election Act, Article 275). 10% of mean income is $2671. Maximum expenditure is $10,000. 2671/10000 = 0.2671 0.2671 of 0.25 = 0.0668 Legislative process Is there an effective legislative process to enforce electoral finance laws? Research Findings Nova Scotia has an extensive legislative process to enforce electoral finance laws, including compliance agreements. Fines range from $5,000 for individuals to $50,000 for registered parties and imprisonment for up to one year. There are no specific provisions for corporations and trade unions (Election Act, Articles 285-348). Although Nova Scotia has effective penalties for individuals and registered parties, it is deficient in fines applied to corporations and trade unions, and therefore, FDA auditors deducted 50% from score out of .75. Total score for the electoral fairness of electoral finance: 77.43 percent out of 100 percent.
  44. 44. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 44 Analysis Based on the FDA scoring scale (see Conclusion chapter), Nova Scotia received a very good score for its electoral finance legislation. This score indicates that the legislation is working in the interest of the majority in Nova Scotia. For example, Nova Scotia does not allow corporations and trade unions to make electoral contributions, and the campaign expenditure limits reflect the provincial mean income. However, the FDA identified certain areas of legislation that are deficient and could potentially affect the election outcome by weakening voice of the majority at the ballot box. Although campaign expenditure limits are reasonable, contribution caps and third party spending by corporations and trade unions are not reflective of the mean income and therefore favour wealthy segments of society. Penalties for electoral misconduct against corporations and trade unions are also decidedly low and potentially ineffective for preventing electoral fraud.
  45. 45. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 45 Ontario Tables 7 Electoral Finance Audit Scores and Percentages for Ontario Electoral Finance Section Variables % Subsection Audit Weight Numerical Subsection Audit Weight Ontario Audit Results % Results Electoral Finance Transparency 20% 2.0 2.0 100% Contributions to Candidates & Parties 15% 1.5 1.0 66.6% Caps on Contributions to Candidates & Parties 20% 2.0 1.1934 59.67% Campaign Expenditure Limits 22.5% 2.25 2.25 100% Caps on Third-party Expenditures 12.5% 1.25 0.0 0.0% Legislative Process 10% 1.0 0.4375 43.75% Total 100% 10 6.880 68.8% Electoral finance transparency Are candidate and party finances transparent to the public? Are candidate and party finances only transparent to candidate and parties and not the public? Are candidate and party finances only transparent to the government? Research Findings Only registered parties, constituency associations or candidates can accept contributions. In registering with the Chief Electoral Officer, political parties, constituency associations and candidates must declare the names of all individuals who may accept contributions and the names and addresses of the financial institutions that will hold their contributions. Parties and constituency associations must also declare their assets and liabilities (Election Finances Act, Articles 10, 11 and 13). Prior to registration, all parties, constituency associations and candidates must declare a chief financial officer. It is the responsibility of the chief financial officer to create and maintain an accurate record of expenses and contributions, to issue receipts, and file financial statements with the Chief Electoral Officer (Election Finances Act, Article 33). Candidates must appoint a licensed auditor at the time of registration, and by parties and constituency associations within 30 days of registration. An auditor will provide a report
  46. 46. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 46 regarding financial statements to the chief financial officer, and has access to the necessary records and documents from the candidate, party or constituency association whom the auditor is working with (Election Finances Act, Article 40). Before May 31 of each year, the chief financial officer of a party or constituency association must file a report with the Chief Electoral Officer concerning the assets, liabilities, income and expenses (excluding campaign expenses) for the previous year. In the case of an election, the chief financial officer files a subsequent report with the Chief Electoral Officer within six months of the poll containing all election-related income received or incurred by parties, constituency associations and candidates during the campaign. In the case of a by-election, only contributions and expenses of related candidates, parties or constituency associations must be reported (Election Finances Act, Articles 41 and 42). Contributions greater than $100, in a single donation or in the aggregate from a single contributor, must be reported by the chief financial officer to the Chief Electoral Officer within 10 days of its receipt. In turn, the Chief Electoral Officer publishes the report and its contents online (Election Finances Act, Article 34). The public may view all documents filed at the office of the Chief Electoral Officer during normal office hours. They are entitled to make copies of these documents, or extracts of, at the cost of making such copies (Election Finances Act, Article 15). The Chief Electoral Officer is responsible for publishing a summary of income, expenses and reimbursement for all candidates and their constituency organizations both online and in The Ontario Gazette (Election Finances Act, Article 2). Electoral contributions to candidates and parties Are electoral donations/contributions restricted to citizens? Are electoral donations/contributions disallowed by foreigners, public institutions, and charities? Are anonymous electoral donations/contributions set at a reasonable level? Research Findings Contributions to parties, constituency organizations and candidates may only be made by individuals, their estate, non-charity corporations and trade unions (Election Finances Act, Article 16). Contributions may only be accepted from persons residing in Ontario, corporations which carry out business in Ontario, and trade unions which hold bargaining rights for Ontario employees (Election Finances Act, Article 29(1)) Funds from federal political parties are only acceptable during the campaign period. These funds may only be accepted by a party, and may only total $100 per candidate endorsed by that party. These are not treated as contributions, but are still sourced and recorded with the Chief Electoral Officer (Election Finances Act, Article 20).
  47. 47. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 47 Affiliated political organizations may make contributions to their related parties, constituency associations, or candidates (Election Finances Act, Article 26(3)). Contributions which break the Ontario Election Finances Act must be returned. Anonymous contributions are not allowed. If received, they must be given to the Chief Electoral Officer for use in their role (Election Finances Act, Article 17). Electoral caps on contributions to candidates and parties Are there caps on contributions to candidates and parties? Are the caps on candidates' and parties' contributions reflective of mean total income? Are there caps on contributions by candidates to their own campaign? Are the caps on candidates own contributions reflective of mean total income? Research Findings Ontario's 2009 mean total income is $29,980 (Statistics Canada, 2011). Contributions are multiplied by an indexation factor, which is the percentage change in Statistics Canada's Consumer Price Index over a five-year period. The Chief Electoral Officer publishes the indexation factor both online and in the Ontario Gazette. The current five-year period is 2009-2013 (Election Finance Act, Articles 18(1) and 40.1; Essensa, 2009). During a calendar year or a campaign period (treated as a separate year), an individual, corporation or trade union may donate a maximum of $7500 (currently adjusted to $9300). The maximum contribution to a single constituency association or candidate is $1000 (currently adjusted to $1240) or $5000 (currently adjusted to $6200) taken together, per calendar year (Election Finances Act, Article 18 (1); Essensa, 2009). Electoral law treats the personal funds of candidates used for their campaigns as contributions and must be recorded as such (Election Finances Act, Article 18(3)). At the discretion of the contributor, goods or services having an aggregate total of $100 or less, contributed by a person, corporation or trade union, are not considered a contribution (Election Finances Act, Article 21 (2)). Annual membership fees for parties may not be considered contributions as long as they do not exceed $25 and membership payment records are maintained (Election Finances Act, Article 30). 10% of mean income equals $2,980. Maximum contribution is $9,300. 2980 of 9300 = 0.1943 0.1934 of 1.0 = 0.1943
  48. 48. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 48 Campaign expenditure Are there campaign expenditure limits on candidates and parties? If there are campaign expenditure limits on candidates and parties, are they attainable, reasonably, by all registered candidates and parties? Are there public subsidies or other financial instruments for candidates and parties? If there are public subsidies or other financial instruments, do they create an equal level of campaign finances for candidates and parties? Research Findings Campaign expenditure limits for all registered parties, individuals and organizations acting on their behalf are multiplied by an indexation factor dependent on the percentage change in Statistics Canada's Consumer Price Index over a five-year period. The current five-year period is 2009-2013 (Election Finances Act, Articles 38 and 40.1; Essensa, 2009). The expenditure limit for all registered parties, individuals and organizations acting on their behalf is $0.60 ($0.74 today) multiplied by the number of electors in all the districts they run in, or in the case of a by-election, the relevant district (Election Finances Act; Essensa, 2009). The expenditure limit for a registered candidate, a constituency association endorsing them, and any other organization acting on their behalf is $0.96 ($1.19 today) multiplied by the total number of electors in their district. For example, in 2011 in the district of Brampton- Springdale, the expenditure limit was $1.19* 87, 543 = $104,176.17. For those running in select northern districts, the expenditure limit is increased by $7000 ($8680, currently). For example, in 2011 in the district of Kenora-Rainy River the limit was $1.19 * 48, 369 = $57559.11 + $8680 = $66239.11 (Election Finances Act, Article 38; Elections Ontario, 2011a, 2011b; Essensa, 2009). Candidates who receive at least 15% of the popular vote for their district may be reimbursed the lower of 20% of their campaign expenses or 20% of their expenditure limit. Candidates running in certain northern districts will have their total eligible amount increased by $7000 ($8680 currently). Political parties that receive at least 15% of the popular vote in any district may be reimbursed an aggregate amount of $0.05 for every elector in the district. In addition to these requirements, any candidate, party or constituency association seeking reimbursement must file a financial statement (Election Finances Act, Article 44). Electoral caps on third parties Are there caps on third-party electoral spending? If there are caps on third-party spending, are they restricted to citizens? If there are caps on third-party spending, are they attainable, reasonably, by citizens? Are there public subsidies or other financial instruments that help create an equal level of thirdparty spending?
  49. 49. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 49 Research Findings Ontario's 2009 mean total income is $29,980 (Statistics Canada, 2011). Third parties must register and appoint a chief financial officer if they incur expenses of $500 or more. The chief financial officer must file a report concerning the third party‟s expenses, contributions and receipts with the Chief Electoral Officer within six months from polling day (Election Finances Act, Articles 37.5, 37.6 and 37.12). Third-party contributors are limited to Ontario residents, non-charitable corporations that do business in Ontario, and trade unions representing Ontario employees (Election Finances Act, Article 37.10(1)). Third parties must appoint an auditor if they incur expenses greater than $5000. The auditor will report to the chief financial officer, and must have access to the relevant documents to do so (Election Finances Act, Article 37.7, 37.13). Legislative process Is legislative process to enforce the electoral finance laws? Is there an effective legislative process to enforce electoral finance laws? Research Findings The Ontario Election Finances Act enforces electoral laws, with $50,000 as the maximum possible fine for corporations and unions, and $5000 as the maximum fine for all others (Election Finances Act, Articles 46-53). The FDA determined that the maximum fine of $50,000 is well below its accepted effective penalty of a minimum fine for corporations of $200,000 and/or a year prison sentence. Ergo, FDA auditors gave a 25% score. 25% of 0.75 = 0.1875 Total score for the electoral fairness of electoral finance: 68.80 percent out of 100 percent. Analysis Based on the FDA scoring scale (see Conclusion chapter), Ontario received an unsatisfactory score for its electoral finance legislation. The score means that Ontario's legislation has deficiencies that could potentially benefit the wealthy segments of society and prevent the electoral process from working in the interests of the majority. Ontario has electoral finance transparency, reasonable caps on campaign expenditures, and public subsidiaries that encourage broad political participation. However, it allows corporations and trade unions to contribute to campaigns, does not apply caps on contributions that reflect the mean
  50. 50. Foundation for Democratic Advancement | 2012 FDA Canadian Provinces Electoral Finance Report 50 income, does not regulate third party expenditure, and imposes minimal penalties against corporations and unions for electoral misconduct. This could allow third parties to have a disproportionate influence on the electoral discourse and election outcome. Additionally, high contribution caps for third parties do not reflect the mean income; therefore, the funds for candidates and parties might not be a sign of popular support. As is the case with Newfoundland and Labrador, any of these areas can potentially prevent a fair and democratic election process in Ontario.

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