Bill C-18 (Historical)
An Act to amend the Canada Elections Act (verification of residence)
This bill was last introduced in the 39th Parliament, 2nd Session, which ended in September 2008.
Peter Van Loan Conservative
This bill has received Royal Assent and is now law.
July 15th, 2008 / 10:05 a.m.
Marc Mayrand Chief Electoral Officer, Elections Canada
Good morning, Mr. Chair and members of the committee.
I am accompanied today, as the chair indicated, by Mr. François Bernier, the legal services director at Elections Canada.
I was requested by the chair of this committee to assist members in the study of the review and treatment of election financial returns and the key considerations involved in the review of these returns. In discussions prior to my appearance, the chair requested that I provide a detailed explanation of the aspects of the legislative and administrative framework that relate to political financing under the Canada Elections Act and, more specifically, of the treatment of election expenses.
This will be the subject of the first part of the presentation. I hope it will provide the committee with a better understanding of the operating context in which decisions are made regarding reimbursement of electoral expenses. I will then turn to the subject of particular decisions of interest to the committee and explain how they relate to the legislative and administrative framework.
The mandate of Elections Canada is to administer the Canada Elections Act in a fair, consistent, transparent and impartial manner. As an officer of Parliament, my first duty is to serve Parliament and Canadians. While the committee is reviewing the activities of public office holders, I trust it will understand that in my capacity as Chief Electoral Officer of Canada, I can only speak to electoral matters. I will not comment on ongoing investigations of the Commissioner of Elections Canada, or the specifics of the case currently before the Federal Court. As well, I will not deal with any individual cases.
Mr. Chairman, with your concurrence, I will now proceed with the first part of my presentation. The committee has already received a presentation that extends to a number of pages—42 pages, I believe. So I won't read each of those pages, but I will simply make the main comments on the essential aspects of the presentation.
The presentation will contain four parts: first, the objective itself, as well as a part dealing with the key principles underlying the legislation and the administration of that legislation, the key aspects of the legislation, and, lastly, the aspects of the administration of that legislation. I will also provide a brief conclusion.
I think it's fair to say that the first hundred years of federal democracy in Canada have been focused almost exclusively on the conduct of elections and on progressively expanding the franchise--the right to vote--to all Canadian citizens. In fact, the right to vote became a fundamental right protected by the Constitution and the Canadian Charter of Rights and Freedoms in 1982.
This focus continues today, as the agenda of the 39th Parliament attests. For example, Bill C-2, the Federal Accountability Act, dealt with the appointment of returning officers, who are now the responsibility of the Chief Electoral Officer. It also dealt, under Bill C-31, with the integrity of voting. It also dealt with the issue of proof of residence, under Bill C-18. And it is considering, currently, Bill C-6, which deals with visual ID; Bill C-16, which deals with advanced polling; and Bill C-20, an important piece of legislation that deals with the appointment of senators. This is all to show that there is still a focus on the electoral process and the conduct of elections.
However, over the last 40 years, growing concerns have been expressed with regard to the influence of money in the electoral process. These concerns have led Parliament to incrementally design a regulatory regime to govern the use of money during electoral campaigns. We are now at the point at which Canada is at the forefront among mature democracies in how it regulates the influence of money in election campaigns. This regulatory regime of political financing was initially built in the seventies, and it has since witnessed repeated legislative reform that continues today. Again, this Parliament passed Bill C-2, which deals with contributions and gifts and which banned contributions from corporations and unions. It is also considering another important aspect of the financial regime, under Bill C-29, with regard to loans.
My purpose today will be to deal with a particular and key aspect of our political financing regime, that of election expenses and their treatment by Elections Canada under the Canada Elections Act. More specifically, I will touch on the legislative framework, the administrative framework, and the compliance and enforcement program.
There are certain principles underlying the legislative and administrative framework. First, to maintain public trust, are transparency and fairness. These principles are expressed through various provisions in the act that deal with public disclosure, expense limits, public funding, compliance and enforcement, and, something that is often forgotten, the distinctiveness of political entities. Each has its own regime, with distinct rights and obligations.
Transparency is about disclosure. It's about providing information to electors on candidates, parties, and other entities. It involves, with regard to financial matters, reporting revenues and expenses and the sources of those.
Fairness is the key principle of a healthy democracy. In our democracy, fairness is about allowing political parties' candidates to have an opportunity to present their visions, their policies, and their values to electors. What those are and how they are communicated to electors is the exclusive domain of political parties and candidates. However, legislation seeks to ensure that the competition among political parties and candidates to secure the vote of electors be conducted within certain rules designed to create and maintain a level playing field. One area of legislation, again, over the last 40 years, has been the adoption of rules that will foster this level playing field. These rules deal specifically with how money can be raised and how it can be spent in order for them to present ideas and reach out to electors.
The Canada Elections Act passed it to the CEO to administer these complex rules, with a view to ensuring that key principles are maintained at all times. In doing so, Elections Canada must act fairly and impartially and exercise due diligence at all times. When it finds evidence of non-compliance and possible offences, it must exercise the authorities provided by the legislation in accordance with all the requirements of fairness and due process, within the strict limits of the law. To do otherwise would undermine not only Elections Canada as an institution but also the democratic process itself.
Let me turn now to the key aspect of the legislative framework as it relates to the treatment of election expenses and the role these key principles play in the electoral law.
The relevant aspects of the legislative framework involve key definitions, a brief discussion of duties of official agents, the notion and concept of election expense limits, the concept of transfers among political entities, reporting requirements for those political entities, entitlement to reimbursement, and key differences between parties and candidates. Note that some misunderstand the system and tend to view parties and their candidates as a single entity, yet the law makes clear distinctions and establishes distinct responsibilities, benefits, and obligations for parties and candidates. For the most part, these are treated independently of one another. This is particularly true in disclosure and reporting requirements, which are different for parties and candidates. Access to public funding is different. Spending limits are set differently for candidates and parties. To some extent, rules governing the raising of contributions are different for candidates and parties.
Let's first look at key definitions. Under candidate electoral campaign expenses, there are three key definitions that need to be considered: candidate electoral campaign expenses; candidate election expenses; and candidate personal expenses.
Electoral campaign expenses are expenses reasonably incurred in the election and include election expenses themselves and personal expenses. There are electoral campaign expenses that are neither election expenses nor personal expenses. An example is the audit expense in excess of the subsidy. It is an electoral expense, but it is not an election expense. There is also the rent of an office outside the rent period. For example, when a candidate rents an office before the writ is dropped or carries the office after the polling date, these are electoral campaign expenses, but they are not election expenses.
An election expense includes any cost incurred or non-monetary contribution received to the extent that the property or service for which the cost was incurred or non-money contribution received is used to directly promote or oppose a candidate during an election period. The expression “directly promote” does not refer only to expenses incurred to expressly urge voters to vote for or against a particular candidate. It has a much broader meaning that encompasses all expenses that directly assist in getting a candidate elected. For example, it includes the rental of office space, equipment in that office, the computers, the supplies, and the remuneration of campaign workers during the election period. All such expenses directly promote the candidate and are thus election expenses for the purpose of the act.
The third definition has to do with personal expenses. Personal expenses of a candidate are his or her electoral campaign expenses other than election expenses reasonably incurred in relation to his or her campaign. Personal expenses include travel and living expenses, child care, and similar expenses.
It's important to note that there are three categories of expenses, each with its own definition and standards. Election expenses must generally be disclosed. They are subject to a reimbursement, and they are subject to spending limits. Personal expenses must be disclosed, and they are subject to a reimbursement. Residual expenses that are neither personal nor for an election must be disclosed, but they are not subject to a reimbursement. Again, I mentioned previously the subsidy for audit.
Another key concept in looking at election expenses is the notion of transfer. The act allows specific political entities of the same political affiliation to move resources amongst themselves without being subject to the restriction on the source and amounts of contributions set out in the act. A contribution is the amount of money received that is not repayable; otherwise it would be a loan. It is the amount of money received that is not repayable, or the commercial value of a service or a property, or the use of property or money to the extent that it is provided without charge or at less than commercial value.
Again, this is a new, essential concept--commercial value. How is commercial value defined? It's the lowest amount charged for a property or service by the person who is in the business of providing that good or service. Alternatively, it's what another commercial provider charges for the property or service who is not in that business.
At the end of the electoral campaign, candidates must file an electoral campaign return. That return is an account of all financial transactions for an election. It consists of a form that has 15 pages and is divided into four parts. It's a bit longer than even a tax return, so there's a level of complexity attached to filing those returns.
Let me give you an example of how these concepts can come together. Let's assume that a party pools the purchase of lawn signs for its candidates and offers those lawn signs to candidates. They have the option of accepting the package or turning it down. Let's say one candidate agrees to purchase 1,000 signs for his campaign and that those signs have a value of $10,000; however, the candidate can only afford $2,000. Provided the signs are used during the campaign to promote the candidate, the return will have to show the transaction as follows. First of all, the election expense will be $10,000 for the candidate, because he received those 1,000 signs and used them during the campaign. That's the amount shown as the expense. Within that he will show the paid expense as $2,000. He will show a non-monetary transfer of $8,000, which is the commercial value of the signs that were transferred from the party to the candidate. The amount shown as the expense will be counted against the spending limit and it will be eligible for reimbursement. The amount shown as non-monetary will count against the spending limit, but it will not be reimbursed since nothing was paid for that amount.
This is a very simple example of how those transactions have to be reflected in the return.
To emphasize the critical role of money and the need to rigorously control inflows and outflows and ensure that financial activities are strictly within the constraints of the legislation, the legislation provides or requires that each candidate appoint an official agent. In fact, a candidate cannot officially run as a candidate without having appointed an official agent. This is a must under the legislation.
An official agent is much more than a bookkeeper. In fact, if we can do an analogy, he or she could be seen as a treasurer or a financial comptroller. You have on slide 9 the key duties of an official agent.
Generally, the official agent is responsible for controlling all electoral campaign expenses; that is, for a candidate's campaign, only the official agent or the candidate or someone authorized in writing can incur an electoral campaign expense. So you will understand that to fulfill his or her duties, the official agent must of course be familiar with all the concepts and the definitions I mentioned earlier and must develop a good understanding of the underlying principles of the legislation.
Let me talk briefly about expense limits. The first point to note is that there are separate limits for parties and candidates and that those limits apply to election expenses, whether paid or unpaid, and include the commercial value of non-monetary contributions or transfers.
Elections Canada calculates those limits for each in accordance with a formula set out in the act. I will not go through the specifics of the formula, except to say that, for candidates, that formula takes account of the number of electors, the population density in the riding, and the geography of the riding, and provides an adjustment for inflation.
Spending limits for parties are a little bit simpler to calculate. It's the number of electors in the ridings for which candidates are presented by the party.
For the 39th election—that's slide 13—the average expense limit for candidates per electoral district was a bit over $81,000, and for a registered party that endorsed a candidate in all 308 ridings, the limit was set at a bit over $18 million. What does that mean? One may be tempted to say that in total a party having 308 candidates could spend altogether up to $18 million for the party and up to $24 million, almost $25 million, given the limits of each and every candidate, for a total of $43 million. However, to look at it in this manner would be mistaken, as the law does not consider the political family as one entity but rather, in this case and this example, as 308 distinct, separate entities with their own rights and obligations.
Let me talk briefly about transfers. The Canada Elections Act recognizes the organic link that exists in the family of political entities, allowing them to move funds, goods, and services among themselves without treating those movements of resources as contributions. The provision of resources from one political party to another, which is not specifically provided for under the act, constitutes a contribution and is subject to the eligibility and limits set out in the act.
Transfer of expenses is not permitted, as this would render the distinct limit of parties and candidates meaningless. As you can see, it is absolutely essential to keep all those definitions and concepts as we look through various returns provided at the end of electoral campaigns.
You will find on slide 15 a table showing the transfers, what is allowed and what is not allowed. Clearly, you will see that transfers between parties and candidates are perfectly allowed by the Canada Elections Act. It has some standards, but they can move resources freely between entities.
You will note that for candidates, these movements of resources can start only after they've been officially declared candidates, meaning that their candidacy has been registered with the returning officer. You will also note that transfers to candidates after polling day are allowed only to pay for unpaid claims and for nothing else.
You will find again at slide 16 another way of looking at it. There is a triangle on that slide that shows the relationship between the party, the candidates, and the EDAs, and the respective rights and obligations for each. You will see clearly that the transfer of money, goods, and services among all three entities is allowed. You will also note that the transfer of expenses is not allowed, and you will see that Elections Canada is overseeing, through various programs, how the money flows among entities.
I should point out that for the 39th election, Elections Canada dealt with 15 registered parties that had over 1,200 electoral district associations, and with over 1,600 candidates, each with their respective agents.
On page 17 you will find a table of the transfers reported in Canada through returns for the 39th election. You will see that all parties represented in the House have transferred resources with their affiliated entities. These have taken place between candidates and parties, between candidates and EDAs, and between parties and EDAs.
Message from the Senate
December 14th, 2007 / 1:15 p.m.
The Acting Speaker Royal Galipeau
I have the honour to inform the House that when the House did attend His Honour the Deputy to Her Excellency the Governor General in the Senate chamber His Honour was pleased to give, in Her Majesty's name, the royal assent to the following bills:
Bill C-15, An Act respecting the exploitation of the Donkin coal block and employment in or in connection with the operation of a mine that is wholly or partly at the Donkin coal block, and to make a consequential amendment to the Canada--Nova Scotia Offshore Petroleum Resources Accord Implementation Act--Chapter 33;
Bill C-28, An Act to implement certain provisions of the budget tabled in Parliament on March 19, 2007 and to implement certain provisions of the economic statement tabled in Parliament on October 30, 2007--Chapter 35;
Bill C-12, An Act to amend the Bankruptcy and Insolvency Act, the Companies' Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005--Chapter 36;
It being 1:20 p.m., the House stands adjourned until Monday, January 28, at 11:00 a.m., pursuant to Standing Orders 28(2) and 24(1).
(The House adjourned at 1:20 p.m.)
Message from the Senate
December 14th, 2007 / 1 p.m.
The Acting Speaker Royal Galipeau
I have the honour to inform the House that a message has been received from the Senate informing this House that the Senate has passed the following bills:
Canada Elections Act
December 13th, 2007 / 3:05 p.m.
Canada Elections Act
December 13th, 2007 / 3:05 p.m.
The House resumed consideration of the motion that Bill C-18, An Act to amend the Canada Elections Act (verification of residence), be read the third time and passed.
Business of the House
December 13th, 2007 / 3:05 p.m.
Peter Van Loan Leader of the Government in the House of Commons and Minister for Democratic Reform
Mr. Speaker, there is a response to the Thursday question and then I will get to the specifics that the member has asked about as part of our business to attend to Bill C-18.
This entire week has been a week of delivering results. I am pleased to see that we have done that this week. The House performed in an exemplary fashion on Tuesday, I believe, when we dealt with the legislation on the national research universal reactor to get that safely restarted so tens of thousands of Canadians and people all around the world can benefit from the availability of isotopes.
Earlier today, we voted on the budget implementation bill.
This bill reduces taxes for Canadians by, for example, decreasing the GST to 5%, and reduces personal and corporate taxes. The bill is now in the Senate. The government hopes that the upper chamber will examine it quickly so that it becomes law on January 1.
As well, just before question period, the House passed Bill S-2, implementing a tax treaty. It is now awaiting royal assent. It will help provide certainty and benefits for Canadian business.
We hope that in a few moments our verification of residence bill for elections will pass the House. This bill is important because it solves the problem of verifying the residences of voters who do not have a civic address on their identification. I know that all members want to ensure that legitimate voters are able to exercise their fundamental rights.
We will have business when we return on January 28. We will continue to focus on the priorities that were laid out in the Speech from the Throne.
They include: tackling crime and strengthening the security of Canadians, providing effective economic leadership for a prosperous future, strengthening the federation and our democratic institutions, improving the environment and the health of Canadians and strengthening Canada's sovereignty and place in the world.
Before we go to the motion, I would like to recognize the work done by all members of the House over the past year. We have delivered results in 2007, and the week's theme was accurate.
While at times the activities and debates do get heated and tense, I know that all members have the best interests of their constituents at heart and that all members are working hard to make Canada a better place to live, work in and raise a family.
Since this is the last Thursday statement of the year, I want to take the opportunity to wish all members of the House, including the House leaders in particular, with whom I work closely, and you, Mr. Speaker, the staff and the pages of this great chamber, and the people of Canada a merry Christmas and a happy new year.
Business of the House
December 13th, 2007 / 3:05 p.m.
Ralph Goodale Wascana, SK
Mr. Speaker, perhaps instead of the normal Thursday question, I wonder if the government House leader would be prepared to see if there is a disposition in the House to deem Bill C-18 to be read a third time and passed. Then there might also be a disposition to see the clock as 5:30 p.m.
Canada Elections Act
December 13th, 2007 / 1:35 p.m.
Charlie Angus Timmins—James Bay, ON
Mr. Speaker, my colleague, in representing an area like Cape Breton, will know the problems. I do not know where Elections Canada gets its maps from sometimes but I know that in my riding people are sent to polling stations 40 or 50 kilometres up the road. The result of that is that they simply do not vote or, if they do try to vote in their own town, they are told they cannot even though they have been in that town their whole life, and they end up not voting. That is a very serious issue.
When Bill C-31 was brought forward, our party brought forward a number of amendments to try to make the bill workable because at the end of the day, as I keep repeating, our job is to make legislation that works and that is practical.
When we found that there was not that much interest in addressing the issues we were raising, the fact that numerous people would not meet this new requirement and we needed to fix the problem, we ended up voting against that bill because we felt that it would come back to haunt us. It has already come back to haunt us twice.
The other astounding testimony that was given just the other day on Bill C-18 by Jim Quail was that this was now facing a charter challenge. It was going to court. Again, no one seemed interested in asking him any questions about the fact that we might get legislation that gets its rear-end kicked all over the courts. However, I asked him questions and there was a clear legal precedent about any interference in the right to vote.
Once again, if we are going to make laws, we need to ensure they stand up to scrutiny and the test of time. Unfortunately, Bill C-18 could have done it, and we were certainly willing to work at it, but at the end of the day I think we will be back to square one. We will still have problems with the way the vote has come down.
Canada Elections Act
December 13th, 2007 / 1:30 p.m.
Libby Davies Vancouver East, BC
Mr. Speaker, I would like to thank the member for Timmins—James Bay for the incredible work that he did at the committee in trying to correct the serious flaws in the bill.
Bill C-18 has a bad history. It started with Bill C-31 when the government moved on legislation that was supposedly based on incidents of voter fraud. I was at some of those committee meetings where we asked questions on whether there was voter fraud going on across the country. Elections Canada told us that there were only isolated incidents and yet that original bill was brought in to a crushing effect. Hundreds of thousands of people, including in my own community of East Vancouver, are now disenfranchised as a result of the original bill and would still be disenfranchised as a result of Bill C-18 that is before us today.
I want to thank the hon. member for the valiant efforts that he made in committee to ensure that some witnesses were allowed to point out the serious flaws in this process and in this bill. However, it seems that this has fallen on deaf ears. Not only has the government been in denial about the impact of this bill, but so has the official opposition and the BQ.
It is quite stunning to see that other parties in this House have refused to acknowledge the disastrous impact of this bill and the impact it will have on people in urban areas, as well as rural areas, but because the issue in urban areas was never addressed we are now disenfranchising people.
I would like to ask the hon. member to comment from the point of view of what he heard from the witnesses and what he will see as the impact of this bill on people in urban areas.