Bill C-29 (Historical)

An Act to amend the Canada Elections Act (accountability with respect to loans)

This enactment amends the Canada Elections Act to enact rules concerning loans, guarantees and suretyships with respect to registered parties, registered associations, candidates, leadership contestants and nomination contestants.

Canada Elections Act

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, I rise on a point of order.

There have been consultations among all parties concerning additional report stage amendments to Bill C-29.

These amendments are necessary to ensure that other provisions of the Canada Elections Act are consistent with amendments that have been made to the bill by the procedure and House affairs committee.

Although report stage debate of the bill has already begun, and many of the amendments that have been under discussion are beyond the scope of Bill C-29, Mr. Speaker, I believe you will find unanimous consent to adopt the following six amendments.

I would ask for the indulgence of the House, as these amendments are lengthy. I move:

That, notwithstanding any Standing Order or usual practice of the House, Bill C-29 be amended by adding after line 13 on page 1 the following:

2.1 Subsection 403.34(1) of the Act is replaced by the following:

403.34(1) An unpaid claim mentioned in a return referred to in subsection 403.35(1) is deemed to be a contribution of the unpaid amount to the registered association made as of the day on which the expense was incurred or the loan was made, as the case may be, if the claim remains unpaid in whole or in part

(a) 18 months after the end of the fiscal period to which the return relates, in the case of a claim to be paid for an expense; or

(b) three years after the day on which the amount is due according to the terms of the loan, in the case of a claim for a loan made to the registered association under section 405.5.

That, notwithstanding any Standing Order or usual practice of the House, Bill C-29 be amended by adding after line 15 on page 6 the following:

7.1 Subsection 423.1(1) of the Act is replaced by the following:

423.1(1) An unpaid claim mentioned in the financial transactions return referred to in subsection 424(1) or in an election expenses return referred to in subsection 429(1) is deemed to be a contribution to the registered party of the unpaid amount on the day on which the expense was incurred or the loan was made, as the case may be, if the claim remains unpaid in whole or in part

(a) 18 months after the end of the fiscal period to which the return relates or in which the polling day fell, as the case may be, in the case of a claim to be paid for on expense; or

(b) three years after the end of that fiscal period in the case of a claim for a loan made to the registered party under section 405.5

That, notwithstanding any Standing Order or usual practice of the House, Bill C-29, in clause 10, be amended by:

(a) replacing line 1 on page 7 with the following:

10.(1) Subsection 435.24(1) of the Act is

(b) adding after line 8 on page 7 the following:

(2)The portion of subsection 435.24(2) of the Act before paragraph (a) is replaced by the following:

(2) The requirement to pay a claim within three years does not apply to a claim in respect of which

435.29(1) An unpaid claim mentioned in a return referred to in subsection 435.3(1) is deemed to be a contribution of the unpaid amount to the leadership contestant made as of the day on which the expense was incurred if the claim remains unpaid, in whole or in part, three years after the end of the leadership contest.

That, notwithstanding any Standing Order or usual practice of the house, Bill C-29 be amended by adding after line 28 on page 8 the following:

13.1 Subsection 435.29(1) of the Act is replaced by the following:

435.29(1) An unpaid claim mentioned in a return referred to in subsection 435.3(1) is deemed to be a contribution of the unpaid amount to the leadership contestant made as of the day on which the expense was incurred if the claim remains unpaid, in whole or in part, three years after the end of the leadership contest.

That, notwithstanding any Standing Order or usual practice of the House, Bill C-29 be amended by adding after line 41 on page 10 the following:

19.1 Subsection 450(1) of the Act is replaced by the following:

450.(1) An unpaid claim mentioned in a return referred to in subsection 451(1) is deemed to be a contribution of the unpaid amount to the candidate made as of the day on which the expense was incurred or the loan was made, as the case may be, if the claim remains unpaid in whole or in part

(a) 18 months after polling day for the election to which the return relates, in the case of a claim to be paid for a candidate's electoral campaign expense; or

(b) three years after that polling day, in the case of a claim for a loan made to the candidate under section 405.5.

(Bill C-29. On the Order: Government Orders:)

December 5, 2007--Report stage of Bill C-29, An Act to amend the Canada Elections Act (accountability with respect to loans) as deemed reported by a committee with amendments--Leader of the Government in the House of Commons and Minister for Democratic Reform

Business of the House

[Peter Van Loan, Conservative, Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, 2007 has been a great year for Canada and a great year for the House of Commons.

Next week is the last week of the fall sitting and the last week before the new year. The sitting and the year have been extremely successful for the federal government, as we have introduced legislation in all of our priority areas and have delivered results for Canadians.

However, since we have only a few sitting days remaining this year to address important tax cuts, security issues and other priority bills still pending, Canadians are expecting us to work very hard in the coming days to produce results for them.

We want to see our priority bills passed in this House and sent to the Senate so that they may become law before Christmas. As a result, next week will be 2007, a year of results week.

We plan to build on our past achievements by debating and passing the budget implementation bill, which would lower taxes for all Canadians by reducing the GST to 5%, as well as by bringing in tax cuts for individuals and corporations.

We will debate Bill S-2, An Act to amend the Canada-United States Tax Convention Act, 1984, which must be passed by Parliament before January 1 to ensure that it is implemented and we can benefit from that.

We will also debate our railway transportation bill, Bill C-8, and our bill on the settlement of international investment disputes, Bill C-9. Both bills will help create jobs and provide economic certainty for Canadians.

Our government will continue to show Canadians that we are serious about tackling crime and strengthening the security of Canadians. Next week, we expect that our security certificates bill, Bill C-3, will be reported back from committee. The bill will then be debated at report stage and third reading. We hope the hon. members of the House understand the importance of passing this legislation so that it may be considered and passed by the Senate before the deadline imposed by the Supreme Court.

We will debate any amendments made to our Bill C-13 on criminal procedure, currently being examined by the Senate.

Speaking of the Senate, the government hopes that the tackling violent crime act will pass the Senate so Canadians can feel safer over the Christmas holidays knowing that the bill has been enacted into law.

Canadians also expect their institutions to be more accountable and democratic. We have built a record of results on this file as well, with the passage of the Federal Accountability Act and Bill C-31 to improve the integrity of the voting process. Next week we will continue with our plans in this area by debating Bill C-29, which closes a loophole in our campaign financing laws that Liberal leadership candidates used to bypass campaign contribution limits last year.

We would also like Bill C-6, on the visual identification of voters, and Bill C-18, on the verification of residence, to be sent back by committee. It is important for these bills to become law, so that they can be implemented in time for the next byelections.

Tomorrow I will also seek consent to send Bill C-30, the specific land claims bill, to committee. This bill to create certainty and allow land claims to be resolved more quickly is a welcome addition and the country will be better off the sooner its process is put in place.

This year, 2007, has been an excellent year for Canada. Our economy is booming, the country is united and there is integrity in government.

We have achieved a lot this year. Our government has delivered real results for Canadians in 2007 and will continue to do so next week and in the new year.

Motions in Amendment

[The Acting Speaker, Conservative, Royal Galipeau]

It being 5:30, the House will now proceed to the consideration of private members' business as listed on today's order paper.

When we next return to the study of Bill C-29, there will be five minutes left for the hon. member for Halton.

[Garth Turner, Liberal, Halton, ON]

Mr. Speaker, I am pleased to speak to this bill in the few minutes left in debate here today.

Mostly, I would like to talk about the law of unintended consequences. I think it is a law that somewhat bedevils the government. For example, when it brought in legislation to fix what it perceived was a problem with income trusts, we ended up actually making the situation a lot worse with Canadians, investors and the economy. I am kind of concerned that the law of unintended consequences might click in with Bill C-29.

The bill seeks to add clarity and transparency to the way that we politicians finance our political activities, mainly election campaigns. It would disallow us the ability to go and borrow money from friends, relatives, places of employment or supporters. It would disallow us the ability, as I understand it, to finance our own campaigns with money borrowed in our own name. In other words, money now has to be borrowed only from a financial institution.

On the surface of it, that does not sound so bad because it makes somewhat of a level playing field among all of us, but when the law of unintended consequences clicks in, all of a sudden we see this. People who are without the means to convince a commercial lending institution to actually give them money for something as dubious and uncertain as running for public office end up out of luck, and, because this is now their sole ability to get borrowed funds to run, we might end up having a lot of people, who would be very worthwhile to have in this place, who would never get here.

I am worried about the consequences, for example, of people with bad credit and people who are not wealthy and who cannot put up a lot of resources to guarantee a loan. Perhaps there are people who are from various groups, female candidates or aboriginal candidates, people who richly deserve to be in this House, who will never make it because of this legislation.

I do not think that is what the government intended. I doubt it is even what the Minister for Democratic Reform intended when this legislation was brought forward. I think it was intended more to catch people, such as the member for Mississauga—Streetsville who crossed from the Liberals to the Conservatives not long ago and now sits as an Independent. I believe it was put into place to catch situations such as that, but the laws of unintended consequences here are very serious.

Effectively, because the only source of borrowed money for a political campaign would now be from a financial institution, which has the power to grant or not to grant that, financial institutions would be given the power of life and death over a political campaign. If they do not finance the campaign, the candidate does not get a campaign. I do not think that is the role of our banks in this country to do that.

I am very concerned that the bill would do nothing to encourage accountability. The system has a lot of accountability now. If people borrow money for a political campaign, they must divulge that. Our guarantor must be public. The terms of the loan must be public. Right now there is every reason to believe that we have adequate accountability in the system.

The Conservatives suggest that the law, as it now stands, somehow leads to secret financing of political campaigns. That is absolutely false. If this legislation does go forward, this place might remain the purview of guys like me: old, white, wealthy, middle class individuals, and, God knows, looking around this chamber right now, I think we have enough of them.

This legislation is actually anti-democratic and I am not about to surrender the ability of good people to run this place to the presidents of banks, and particularly the loan officers of those institutions.

Therefore, I must say that I do not agree with this legislation at all. I think it is draconian and I would call upon the Minister for Democratic Reform to withdraw it.

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, my colleague from Winnipeg Centre raises a very interesting question. A distinction must be made between, on the one hand, the legislative rules that would be brought in under Bill C-29 and, on the other hand, the constitutions of each of our parties. The NDP constitution is different from ours; the Liberal constitution is different from that of the Conservatives. It is therefore very difficult, but it is absolutely necessary—

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, I am pleased to speak to Bill C-29.The Bloc Québécois supports this bill, which seeks to prevent individuals from bypassing campaign financing rules. We support the bill for the simple reason that we think it is necessary to regulate loans in order to prevent people from getting around the financing ceilings. The problem with certain bills is that the wording may be clear, but sometimes the spirit of the letter can be abused. Sometimes a bill can be convoluted and ambiguous. This can result in misinterpretation or misapplication of the legislation. This bill establishes more rules for political financing.

I want to remind hon. members that financing ceilings were established in response to one of the Bloc Québécois' traditional demands. We demanded an end to corporate financing and limits on individual contributions, as has been the case in Quebec for 30 years.

I remember it as though it were yesterday. I can still see Prime Minister Chrétien, who was paying tribute to René Lévesque for introducing clear financing rules, or should I say, pure financing rules, in Quebec. Mr. Chrétien did not use those words, but he said that the new rules, which prohibited corporate financing, were largely inspired by what was happening in Quebec. Imagine. It was not easy for former Prime Minister Chrétien to pay tribute to René Lévesque. Mr. Chrétien probably had to dig deep for that. He probably had a hard time getting it out, but fortunately, for the benefit of everyone, Mr. Chrétien implicitly recognized that the Bloc Québécois had a reason to be persistent and to call for better financing rules at the federal level.

This bill includes the only modification proposed by the Bloc Québécois when the old Bill C-54 was at committee stage. After the throne speech, some bills had to be re-introduced, including the one before us, Bill C-29. The Bloc Québécois was strongly against political parties being held responsible for debts incurred by their candidates, particularly when the political party is not named on the contract between the candidate and the bank.

The members of the Bloc Québécois choose its candidates democratically. We sell membership cards for $5, and by purchasing a card, any person who subscribes to our values, principles and policies is showing that they support the Bloc Québécois in its defence of the interests of Quebec here on the federal scene. The membership card also gives the individual the opportunity to choose who will represent the Bloc Québécois and the Bloc Québécois platform in a byelection or general election. This is one of the benefits of being a member. There are others, such as the right to attend the annual general meeting, the right to receive party literature, and many other rights associated with being a member of a political party.

The Bloc Québécois is different from some other parties where the leader, on his or her own authority, can literally name certain people as candidates for the party. In our case, the members choose the candidates democratically. This democratic approach also means that anyone who is a member and shares the party's views can stand for nomination. This can cost candidates money. However, the bylaws of the Bloc Quebecois place a limit on what a candidate for nomination can spend. I believe it is $1 per member in good standing, but I could be wrong. At this late hour, my party's bylaws are not uppermost in my mind. Regardless, there is a limit on what candidates can spend. A person therefore could not decide to spend $350,000 to become a candidate at a Bloc nomination meeting.

During the last session, we found there was a problem with this bill, which was then known as Bill C-54. Candidates could spend up to the maximum stipulated in our party's bylaws, but if they were unable to pay their debts, if they had taken out a loan from a financial institution, the party was held responsible. We considered that totally unacceptable, and we still do. The party should not be held responsible for the debts of a candidate for nomination.

That is why, on behalf of my party, I introduced an amendment to Bill C-54, and I succeeded in convincing my opposition colleagues to bring the government into line. Unfortunately, as hon. members can read in the Order Paper and Notice Paper, the government House leader has introduced three amendments to this bill. One of those amendments would nullify the effects of the amendment my NDP and Liberal colleagues on the Standing Committee on Procedure and House Affairs agreed to after I convinced them. The government is proposing a motion to reverse this democratic decision of the committee.

With respect, I want to tell the government House leader that he will likely be disappointed, because I believe that my Liberal and NDP colleagues support the Bloc Québécois' interpretation, and we intend to reject this government amendment, which is designed to reverse what we won in committee. We do not want the government to do indirectly what it was incapable of doing directly.

Because I do not have much time, that concludes my remarks. The Bloc Québécois supports the bill, because it clarifies some rules on political party financing.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, I am very pleased to be here in the House to discuss Bill C-29, An Act to amend the Canada Elections Act (accountability with respect to loans).

We of course as Liberals certainly support the spirit of this bill, but as with most of the government bills this session there are a number of problems. We can see this simply by the fact that there are a number of amendments that have been made to the bill.

The Liberal Party has always supported carefully identified limits and in fact, as many have said in the House already, the Liberal Party of Canada brought in the largest reduction of allowable political contributions in Canadian history and included a huge decrease in what corporations could donate.

As members from different parties have mentioned, I too believe that members of Congress are in an unfortunate situation. They can only sit for two years before the next election and in that time they have to raise millions and sometimes tens of millions of dollars. Some of the members had other problems with that. I do not enjoy fundraising as it is, but the problem I have is when are we going to do our work if we are trying to raise tens of millions of dollars within a two year period.

A lot of our efforts, as all members of Parliament know, are so overburdened with things to do to help our constituents to improve laws, to attend committees, to meet with organizations that want to influence us on a national level in Ottawa, and then we go back on the weekends and hear all the same things from organizations in our ridings.

If we are going to give a fair hearing to all of these people, look at legislation carefully, prepare for our committee work, prepare for our caucus meetings, and then in a two year period have to raise tens of millions of dollars on top of that, something will be lacking.

Therefore, I certainly think the system we have is very good in that respect which is one of the reasons we limited contributions so much in our system. We support that direction in electoral reform.

Along those lines we want to eliminate any undue abuse of loans that could pervert that system. The problem is that the Conservatives are suggesting that the current legislation allows loans to be written off without consequence. This is absolutely false. Loans cannot be used to avoid donation limits and they cannot be written off without consequence.

There is also another similar point about where the proponents of the bill are misleading Canadians about the current state of the law concerning political financing. The Conservatives are suggesting that the current law allows loans to be made in secret and that Canadians are kept in the dark.

The truth is that under the law that is currently in place the details of all loans including the amount of every loan, in the name of every lender and every guarantor, must already be publicly disclosed.

Therefore, we have to be careful that we are not just writing redundant legislation that is already covering elements that are already in place, elements of course of transparency and accountability that I am sure every member of the House would like to see.

Another element that has been raised during the debate is the philosophical question as to whether it would give financial institutions the final say in who runs as opposed to Canadians. This has been raised by several members in the House and some of my colleagues. I think each member of Parliament will have to think philosophically about that situation where loans only come from those particular institutions.

Of course we all want to ensure transparency and that there is no undue access by any particular groups of people or organizations, and we want to be absolutely sure about that. However, we also do not want to restrict the rights of Canadians to access the democratic process, to take part in it, to show that they are serious, and to contribute toward what they believe in. We certainly need to get a balance in those areas.

I want to talk about the two amendments. In a bill related to accountability and the democratic process, the committee democratically approved these amendments but now the government is trying to withdraw them.

The first amendment I want to speak about would have the Conservatives changing the contribution for a leadership campaign. It is presently $1,100, a very tiny amount. We can well imagine the costs for leaders as these campaigns sometimes take several years.

However, the costs for a candidate are very high. We want to be fair to Canadians from all parts of the country and we do not want to discriminate against rural Canadians. We want to allow candidates to get across the country, but the costs and expenses of their travel, their team and the preparation of policy and promotional material, and all that is involved in preparing for debates, all of that is very expensive. So a contribution of $1,100 is not going to go very far.

The present proposal and existing law allows $1,100 per year of a campaign. Usually that would be two years or three years until the contribution has been paid off and it is not an excessive amount of money.

The Conservatives are trying to withdraw what the committee has done and only allow a contribution of $1,100 for the entire lifetime of the campaign and of the process no matter how long it is. Of course, we disagree with that as do some others.

We also have a problem with the second amendment and speakers from other parties have spoken about problems with this amendment as well. The Conservatives are trying to suggest that if a candidate runs up some debt then his or her party or the local association, if there is one, would have to pay that debt.

Really, I cannot imagine many people seeing the sense in allowing other people to run up debt. If I were to run up a debt and then tell the Conservatives they would have to pay for it when they had nothing to do with incurring that debt, that is not the way the system should work.

There could be candidates who go out and incur debt that no one knows about and that puts the onus on people who did not even know the debt was incurred to repay that debt. Or, an organization that is thousands of miles away and would not have any idea that the debt was being incurred would ask the candidates to repay such a debt.

I am not sure that would withstand any type of court challenge related to fairness. We cannot go along making loans that people do not know about and then asking them to pay for it. That is why there has been so much objection to that amendment.

In my last 30 seconds I want to emphasize a point regarding accountability. When the government is putting a whole bunch of conditions on people and government programs, then the clients who really need that money do not have a bureaucracy to make all these overzealous rules and meet these conditions are really being harmed by that mismanagement of government.

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, Bill C-29 deals with the Canada Elections Act and accountability.

I will do a bit of history and talk about public accountability. Unfortunately what has happened for decades is the confusion with respect to what public accountability is or is not and the confusion between public accountability, conduct and responsibility. To the casual observer it seems they would be very much the same thing, but they are not and the implications of that are quite significant.

I owe much of this to Mr. Henry McCandless, from Victoria, who is a retired senior member of the Auditor General's office. He has waged a battle for many years to introduce true public accountability into the public service and into Parliament for the reason of affecting conduct. If we get public accountability right, in effect what we will be able to do is affect conduct and have a transparent means upon which the public can know what we, as elected officials, do and therefore be judged by that. In fact, if we get public accountability correct it is a liberating exercise for those of us who serve and for the public itself.

Let me for a moment give a true definition of public accountability. Public accountability is the obligation of authorities to explain publicly, fully and fairly, before and after the fact, how they carry out their responsibilities that affect the public in important ways. It is an obligation to report publicly to explain the intentions and reasons, including performance standards, what those performance standards are and, after the fact, whether they have been met.

In other words, the outcome of performance and the learning game can also be applied and in doing so, it is the liberating experience. Said another way, we as elected officials and senior members of the public service have an obligation to Canadians to tell them what we will do, why we will do it and what the public performance standards are upon which we will be judged. Then the outcomes can be judged and measured. We not only can go hand on heart and tell the public, in a transparent way, what we will do, but we know what we will be judged on. We know what the goals are, the public knows what the goals are. In doing this, we can measure very clearly how effectively we have executed our duties in the interests of the public good.

That should have been in the public accountability bill, but it has nothing whatsoever to do with public accountability and had everything to do with conduct. It has put on layers upon layers of administrative oversight, which are utterly unnecessary, upon the shoulders of the public service. This has created an expensive mechanism that will add absolutely nothing to public accountability and, in fact, will diminish the effectiveness of the public service to carry out its duties.

I cannot overemphasize the fact that the public accountability bill has been one of the most damaging public initiatives by the current government, or any government, in allowing the public service to execute its duty and for the public to be served well by an effective public service and an effective Parliament. Because this happened on the back of Gomery inquiry, it was a political initiative on the part of the government to try to make it look like it was cleaner than the previous government. It was all a bunch of nonsense. It was purely a political exercise.

The tragedy of the political exercise, the public accountability bill, is it has diminished the effectiveness of the public service and Parliament. Maybe the government wanted to do that. The Prime Minister is a follower of the U.S. political philosopher, Leo Strauss, who believed that a small number of people were predestined and preordained to lead. The Prime Minister is exhibiting that in Parliament and in the execution of his duties and that of the government.

Through what he has done, we do not now have a Parliament by the people, for the people or for the public through their elected officials. We have a government that is run by the Prime Minister's office, by a small group of unelected, invisible people who govern. These people do not listen to the public service. They exclude civil society and NGOs. They certainly diminish the effectiveness of the House by not listening to their members, their backbenchers and their ministers, their executive for the most part. They certainly do not give a care what anybody else thinks in the House. They also do not care what the public thinks.

If they are so sure in their ideology, that they believed they were preordained to govern and that their ideas are the only ideas that count and they have a tin ear to anybody else's ideas, then they will only move forward what they want and they will not listen to anybody else. However, by that, the public and our country is not served well. If they do not listen to Parliament, if they do not listen to other ideas from across the House, if they do not listen to their members, if they do not work with members from different sides, if they do not listen to NGOs and civil society and experts in our country, even the provinces, which are largely and often being excluded from decisions that affect them, what we have is a government that is less than what it could be, that is open to umpteen mistakes and that makes our country less than what it could be.

Is it not a government's responsibility to tap into the best and brightest ideas in our nation? Is it not a government's responsibility to tap into those great minds and those great ideas from coast to coast? Is it not a government's opportunity to tap into those solutions and implement them in the interest of the public good? I submit they are.

If the government were to truly introduce a public accountability act, it would put the responsibility on the shoulders of elected officials and unelected public servants, which includes people in the PMO and the PCO, to tell the public what they will do, who will benefit, why they will benefit and identify the public reporting standards upon which its activities are going to be judged. This would liberating for a government. The government could go to the public, tell it what it had done and how effective it had been. In those areas where a government had fallen short, there would be lessons to learned, and the public would fully understand that.

If a government were to do that, it would affect conduct. The conduct of an individual or a party would be measured by that which it told the public it would do. The government ought to be transparent, effective, wise and accountable.

There is a misnomer that public moneys or private moneys can somehow affect decision making. I wonder how many folks out there know that the limits for what people can donate legally to our elections, and to anybody who is running federally for a public office, is very modest. I believe it is between $1,000 and $5,000, $5,000 being the maximum. Banks, organizations and such, could only donate $5,000.

That is very different from the situation south of the border, where there are no spending limits. Thankfully our country has spending limits and they are governed by law. Therefore, if somebody is going to provide big money to somehow affect the public voting or influence an elected official: (a) the amount of those moneys would have to be large; (b) the person would have to be unscrupulous; and (c) if the person accepted it, he or she would be committing an illegal act. For many years it has been illegal for elected officials to accept large sums of money that would influence our decision making.

The government's notion of public accountability is dead wrong. It needs to review what it is and implement true public accountability. It would be something that no other government has done before and it would be a remarkable legacy if it were to do that.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, on behalf of my colleagues in the NDP caucus, I am very pleased to join the debate on Bill C-29.

Let me say at the outset that I support the content of Bill C-29. I should point out that it finds its origins in a motion put forward by the New Democratic Party on the Federal Accountability Act which, sadly, failed at the time, but the government revisited the issue and saw fit to introduce the same subject matter in a separate bill. That bill is the one before us today.

We should start with the basic premise that nobody should be able to buy an election in this country. In fact, nobody should be able to buy a politician in this country. We should take whatever measures necessary to take big money out of politics for all the reasons that should be self-evident to those of us in the chamber today or anybody watching.

We only need to look south of the border to see how big money can undermine democracy. I do not want to cast any aspersions on the character of politicians there, but I would point out that it takes a couple of million dollars now to run in any credible way for a seat in Congress. Surely, people can see that if people have to start their political careers owing $2 million, it can, and I am not saying it does but it can, influence the way people make public policy. That is something we want to avoid in this country.

This bill also asks another question, and that is, when is a loan not a loan? I would put it to you, Mr. Speaker, that if a loan is never repaid, it is not really a loan anymore. It is a donation. That is the way Elections Canada views loans that are not repaid. If they are not repaid in 18 months, they become donations.

If a loan is larger than the amount people are allowed to donate and 18 months later it becomes a donation, they have made an illegal donation. There is a contradiction in our election financing laws that cries out to be addressed. This bill does just that.

Looking at the origins and history of this bill, I would like to recognize and pay tribute to the former leader of the New Democratic Party, who most recently sat as the member for Ottawa Centre, Ed Broadbent. A seven part ethics package was put together by Mr. Broadbent which became part of the NDP election campaign platform. It dealt specifically with the idea of election financing loans being problematic in our election financing system. The reason he was seized with the issue at that time is that we all observed the Liberal leadership race.

We became aware that even though the donation limits governing leadership races and other political events were quite rigid, because the very rules the Liberals established placed pretty serious limits on how much could be donated, the loans that were being made were massive. One person alone, the former NDP premier of Ontario, had $720,000 worth of loans from his brother, the executive vice-president of Power Corp. That loan would have to be repaid in accordance with the donation limits, which today would be $1,100 per person per year. We did not see how that was possible.

We were concerned that that loan would be lost in the sands of time without people aggressively policing how loans like that are repaid. People forget about them. Eighteen months later it would fall to the Chief Electoral Officer to follow it up, police it and make sure it was paid back. We are doubtful it happens in that way. This bill would preclude these big loans that are not really loans from undermining democracy and allowing big money to dominate politics once again.

There were other examples, too. Perhaps a more egregious example happened recently with the member of Parliament for Mississauga—Streetsville, who was a Liberal, crossed over to the Conservatives and now has to step out of that caucus as well because it was found that he was circumventing the election financing rules. Even though unions and businesses are not allowed to donate a single penny to finance an election, businesses can lend any number of dollars. In fact in this case, his own car dealership lent $240,000 to his riding association. Surely that violates at least the spirit of the act, if not the letter of the act.

I understand the election financing problems he has now deal more with overspending. I guess he was sitting on such a pot of money he overspent in his election campaign, but I call attention to the flip side of that coin and that is the source of that very money that he overspent, which was a loan from his own car dealership. That is fundamentally wrong.

It gives an unfair competitive advantage to somebody who can find a big corporation, or a big union for that matter, willing to finance him or her to this great extent, when the rest of us are out there scrambling around trying to raise money within the donation limit of $1,100 per year. Surely anybody can see the unfairness and the inequity of a system that would allow big money to dominate politics in that way.

As I said in my opening remarks, nobody should be able to buy an election in this country. It undermines democracy and more important, it undermines the public's confidence in their democratic institutions.

We are in the throes of a graphic illustration of how big money can undermine democracy. To those of us who sit on the ethics committee, and my Conservative Party colleague who is the vice-chair of the ethics committee perhaps feels the same way, if big money is influencing public policy decision making in the form of undue loans or loans that violate the spirit and the letter of the election financing laws, or bags of cash are given to leadership hopefuls or former prime ministers in hotel rooms, the public confidence in their institutions is severely shaken and undermined.

We work too hard to set up the best country in the world to see its democratic institutions undermined by what can be only described as greed by those who are willing to take advantage of loopholes in the election financing laws or in the lobbying registration laws, or the lack of them.

When the NDP was faced with the previous incarnation of this bill, and I believe it was Bill C-54, we spoke in favour of the bill. We note now that the government has introduced three amendments at report stage, two of which we have no difficulty with. We believe they are technical in nature and not of any substance.

The third one we do have a problem with and we will have to serve notice that we will vote against the third recommended amendment at report stage. It is a default mechanism that if the candidate in an election campaign defaults on a loan, it automatically goes to the federal party. We are not in favour of that amendment. We believe it complicates matters. Unless the political party has the right to veto such a loan, it should not be the automatic seconder or co-signer of that loan. It seems to me that it places an undue financial burden on the federal parties.

There are enough illustrations and graphic examples in the country that the general public could relate to this bill. In the spirit of fairness, in the spirit of levelling the playing field, in the spirit of creating an election financing regime where we all have an equal opportunity and we do not have a system that is dominated by big money in politics, that should be our goal. It should be our guiding principle that one of the best things about our election system, I believe, is how egalitarian it actually is.

There was a time when politics was the purview of the well connected, the rich and the powerful. We have a political system where a carpenter like me can aspire to raise the small amount of money necessary to become a member of Parliament. We have schoolteachers, auto mechanics and electricians; I have met many of my colleagues from all walks of life.

That is the system we want to preserve. We do not want to give an unfair competitive advantage to those who happen to know people who could lend them massive amounts of money far and away larger than the annual limit that we have set through the election financing laws.

[Pauline Picard, Bloc, Drummond, QC]

Mr. Speaker, under Bill C-29, loans, guarantees and contributions from individuals could not exceed the limit set out in the Federal Accountability Act, $1,100 in 2007. Only financial institutions—at commercial interest rates—and other political entities would be allowed to lend amounts exceeding that amount. The rules governing unpaid loans would be strengthened to prevent candidates from walking away from their debts.

We agree with these provisions. Quebeckers have always wanted this legislation to be as transparent as possible. We think that the way we do things in Quebec—

[Pauline Picard, Bloc, Drummond, QC]

Mr. Speaker, I am happy to take part in this debate on a bill that aims to correct another problem with the Federal Accountability Act. I would remind this House that when Bill C-2 was studied, the government was interested in passing the bill quickly, an attitude that we in the opposition parties, the media and Democracy Watch criticized.

The Bloc Québécois supports Bill C-29 in principle, because it addresses the problem of loans that allowed individuals to bypass political contribution restrictions. In fact, Bill C-29 fills the gaps the government left in studying Bill C-2, which contains little protection for whistleblowers and does nothing to improve the Access to Information Act.

Quebeckers have long understood the importance of having clear, reliable rules on financing political organizations. The Bloc Québécois supports Bill C-29 in principle, because it should prevent people from getting around the financing rules, especially as regards contribution limits.

I want to stress that the Bloc Québécois fought long and hard for these limits. Inspired by the system that has been in place in Quebec for 30 years, we called on the government to put an end to financing by companies and limit individual contributions. Bill C-29 incorporates the only change proposed by the Bloc Québécois when Bill C-54 was studied in committee. Then, we decried the fact that the political party was held responsible for its candidates' debts, even if the party was not a party to the contract between the individual and his or her financial institution.

I must say that I am extremely disappointed that the government is refusing to comply with the committee's decision on this. Although the current government wants to demonstrate good faith and sincerity, the fact remains that its intentions are not really genuine. In fact, the Conservatives are using this bill to point out that during the most recent Liberal leadership race, several candidates took out big loans to bypass financing restrictions. Yet the Conservatives are forgetting that the Prime Minister himself has not disclosed all of the contributions he received during the 2002 leadership race.

If the Conservatives think they can pass themselves off as the champions of transparency and the standard bearers of ethics, I must remind them of a few facts that might force them to reconsider. We all remember, as does the public, all the back and forth between political offices and lobbying firms, the contracts awarded to political friends, the use of public funds for partisan purposes, the many partisan appointments, the appointments of judges and immigration commissioners, that is, to the IRB, on the basis of their political beliefs, and the publication of a guide intended for Conservative members who chair committees that lists every possible, imaginable measure to obstruct the work of committees.

Bill C-29 aims to correct the problem of loans used to circumvent the limits on contributions paid to political parties, but certain problems remain. Whistleblower protection comes to mind. During the election campaign, the Conservatives promised to guarantee whistleblowers greater protection. They wanted to “ensure that whistleblowers would have access to adequate legal counsel”. Yet the Conservatives' bill allows for only $1500 in legal fees.

They also wanted “to give the public sector integrity commissioner the power to enforce the whistleblower legislation”. They wanted “to guarantee protection to all Canadians who report wrongdoing within the government, not just to public servants”. Furthermore, they wanted “to take away the government's ability to exempt crown corporations and other entities from the application of the whistleblower legislation”.

In the recent sponsorship scandal, one of the whistleblowers, Allan Cutler, a Conservative Party candidate in the 2006 election, I should mention, was somewhat critical of Bill C-2. He maintained that Bill C-2 was far from perfect and had some problems that needed fixing, especially with respect to the provisions for protecting whistleblowers.

On April 5, 2005, the Liberal government released a discussion paper on reforming the Access to Information Act. This document met with general criticism. In addition to doubling the minimum administrative fees charged to the public, the proposal by the member for LaSalle—Émard, maintained all the exceptions provided for in the legislation.

If the Liberal Party never managed to bring about any useful reform of access to information in 13 years, the Conservative government, despite its election promise, did not do any better. We are still waiting for this reform.

The public knows that once in power, the Conservatives and the Liberals are not in such a hurry to reform the legislation. The information commissioner recently observed that this is a common trait in all governments:

The reason that action, not more study, is required is that governments continue to distrust and resist the Access to Information Act and the oversight of the Information Commissioner.

With regard to the lack of transparency in election financing, we can see that the Liberals and the Conservatives are equals. What is the Prime Minister waiting for to disclose all the contributions he received during the 2002 Canadian Alliance leadership race? The public must know that the Prime Minister admitted, in December 2006, that he failed to disclose to the Chief Electoral Officer that he had received hundreds of thousands of dollars. The money consisted of registration fees collected from Conservative delegates attending the Conservative Party's May 2005 convention. The party was forced to treat convention registration fees as donations. The report indicated that three delegates, including the Prime Minister, had exceeded their annual contribution limit of $5,400 to the party.

At the very least, the Conservative government is a government susceptible to powerful influences. The Prime Minister, when he was leader of the opposition, reprimanded the Liberals for the comings and goings between political offices and lobbying firms. Yet, since taking power he has done no better.

To summarize, the bill establishes a standard and transparent reporting system for all loans made to political entities, requiring the mandatory disclosure of the terms of these loans as well as the identity of the lenders and guarantors.

The bill would prohibit all unions and corporations not only from making contributions, in accordance with the Federal Accountability Act, but also from lending money.

Loans, loan guarantees and contributions from individuals could not exceed the limit set out in the Federal Accountability Act, which is $1,100 for 2007.

Only financial institutions, at market interest rates, or other political entities would be able to lend money exceeding that amount. The rules for unpaid loans would be tightened so that candidates could not default on their obligations.

Loans not repaid within 18 months would be considered a political contribution.

Riding associations, or where there are none, the parties themselves, would be held responsible for their candidate's unpaid loan.

For all these reasons, we support the principle of this bill but we truly hope that motion no. 3 will be defeated.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Mr. Speaker, the Liberal Party supports efforts to improve the transparency and accountability of the electoral process. Early on, our party was the one that passed the bill to limit the role of corporations and unions in election financing. We also initiated the most significant contribution limit reduction in Canadian history.

That is why Liberal party leadership candidates exceeded Elections Canada's requirements to disclose campaign loans. In contrast, the current Prime Minister is still refusing to disclose the names of those who contributed to his leadership campaign in 2002.

In practice, this legislation would give the last word to financial institutions, not Canadians, when it comes to deciding who can run for office in Canada. This bill would also have a negative impact on Canada's middle class, particularly nomination contestants, at a time when the government should be encouraging Canadians to increase their participation in the democratic process.

If the proposed changes are implemented, it will be very difficult for Canadians, particularly those with limited means who know few wealthy potential backers, to try to get elected in Canada because it is hard to get a loan from a financial institution. Even though we are in favour of a transparent and accountable electoral process, we believe that this bill unduly restricts Canadians' access to the democratic system and that it will prevent them from participating in it.

The Conservatives would have us believe that current legislation enables individuals to walk away from debts. Nothing could be further from the truth. Under the current legislation, individuals cannot use loans to bypass contribution limits, nor can they walk away from debts with impunity. The bill merely reiterates existing provisions. The Conservatives think they can fool Canadians into believing that this bill in some way makes significant changes to the law.

For the record, the official purpose of this bill is to reduce the possibility of undue influence in public life by wealthy interest groups. Obviously, this bill was developed to put the Liberal Party of Canada at a financial disadvantage. The main consequence of this new bill is that it severely restricts the opportunities for people running for office to take out loans, a common practice in the past. The proposed legislation would prohibit individuals from making a loan or guaranteeing a loan to political candidates by restricting contributions to the $1,100 limit currently in the Federal Accountability Act.

Furthermore, as in the Federal Accountability Act, unions and corporations cannot make a loan to political candidates, parties or associations. Of course, the government claims that the purpose of this measure is to reduce the influence of wealthy financial contributors, who apparently used personal loans to bypass the restrictions on donations in the Elections Act.

The fact of the matter is that during our last leadership campaign, all the candidates publicly disclosed all the loans they had received for their campaign and went above and beyond what was required by Elections Canada. If this bill is passed, only political parties such as the Liberal Party of Canada or local riding associations and financial institutions will be able to make loans to candidates, and it must be at the market interest rate.

There are also new disclosure criteria, requiring that all conditions such as the amount, rate, lender's name and address, and the guarantor's name and address, if applicable, be disclosed.

If the Chief Electoral Officer determines that an unpaid amount of a loan to a candidate of a registered party has been written off, the registered association or, if there is no registered association, the registered party becomes liable for the unpaid amount as if the association, or the party, had guaranteed the loan.

The minister referred to the changes in this regard. I should remind the House that, when it met last spring to consider the bill, numbered C-54 at the time, the Standing Committee on Procedure and House Affairs agreed by a majority vote to amend the government's proposal, to ensure that debts incurred by candidates without the consent of their associations or parties not come back to haunt the associations or parties. A majority of the committee did not want this to happen.

Unsatisfied with this majority decision of the committee, the government is now changing the wording of the bill to make this undesirable situation possible again.

The original text of Bill C-29 read, on page 5, lines 32 and 33, “the claimant, the candidate's registered association or, if there is no registered association, the registered party.” It said that these parties shall be informed. Today, the government is seeking to amend lines 32 and 33. At line 32, it is keeping the word “claimant”, but replacing the comma with a semicolon followed by “the registered association or, if there is no registered association, the registered party”, and it adds: “becomes liable for the unpaid amount as if the association or party had guaranteed the loan.”

This reversal of the reversal adopted by the majority in committee in the spring is unacceptable in that the association—or, if applicable, the party—would be held responsible for a loan without previous knowledge of it, without having guaranteed the loan, and without having been informed that the loan was contracted. A national association—or a national party—could quite easily end up in a situation whereby a candidate, without consent from the association or the party, could incur personal debts, under the pretext that it is for an election campaign. Then the party—or the association—without warning, would be responsible for paying back the loan. It is very difficult to accept that part.

There is also the matter of financing leadership races. The minister was honest. He bluntly said that instead of allowing citizens to participate by making contributions on an annual basis, as long as the loan has not been paid back in full, citizens should instead make a single contribution for a maximum of $1,100. The legislation prevents them from participating any more than that in leadership race financing.

Since I do not have very much time left, I want to say that although we are in favour of having a transparent and accountable electoral process, we believe that this bill unduly limits Canadians' access to the democratic system and that it will impede their participation.

[Peter Van Loan, Conservative, Leader of the Government in the House of Commons and Minister for Democratic Reform]

moved:

Motion No. 1

That Bill C-29, in Clause 4, be amended by deleting lines 13 to 17 on page 2.

Motion No. 2

That Bill C-29, in Clause 5, be amended by replacing lines 29 to 35 on page 4 with the following:

“case of a candidate, the selection date as defined in section 478.01 in the case of a nomination contestant, the end of the leadership contest in the case of a leadership contestant, and the end of the fiscal period during which the loan was made in the case of a registered party and registered association, is deemed to be a contribution of the”

Motion No. 3

That Bill C-29, in Clause 5, be amended by replacing lines 32 to 35 on page 5 with the following:

“Officer shall inform the lender of his or her decision; furthermore, the candidate's registered association or, if there is no registered association, the registered party becomes liable for the unpaid amount as if the association or party had guaranteed the loan.”

Mr. Speaker, I am pleased to be bringing before the House once again the bill on accountability with respect to loans, former Bill C-54 now Bill C-29, which was reinstated at report stage, in the same form as at prorogation.

The hon. members will certainly recall that this bill amends the Canada Elections Act in order to establish stricter and more transparent rules for loans to political entities. These amendments will ensure a more responsible and transparent use of loans as a tool for political financing. In this regard, accountability and transparency are essential to maintain the confidence of Canadians in the integrity of the political process.

This bill is one of many measures taken by our government to improve democracy and accountability in Canada, in accordance with three major principles of democratic reform: reform of political financing, improving the electoral system and modernizing the Senate.

In the October 2007 throne speech, the government reaffirmed its intention to proceed with these reforms. Our dynamic legislative program of democratic reforms will make real and significant improvements to our democratic institutions.

I remind the House that the amendments proposed for the treatment of loans in Bill C-29 are an important measure to maintain public confidence in this institution and our democracy.

Canadians must have confidence that there is no opportunity for the wealthy to secure undue influence in our political process.

The measures in Bill C-29 follow closely on this government's achievements in the Federal Accountability Act to ensure greater accountability and transparency in political financing. The objective was to eliminate the undue influence of big money in politics.

Members will recall, however, that during the recent Liberal leadership campaign big money found a back door to undue influence through large personal loans well in excess of the legal contribution limit.

The amendments would mean that the same standards of transparency that currently apply to contributions would apply to loans.

By closing the loopholes that allow people to use loans to get around both the limits on contributions and the restrictions on their source, Bill C-29 will ensure that the reforms that have already been made to political contributions cannot be undermined by the abuse of loans.

I would like to remind the House of the measures that are included in this bill. First, the bill would put in place a uniform and transparent disclosure system for all loans to political entities, including the compulsory disclosure of loans' terms and conditions and of lenders' and guarantors' names. This measure would make loans more transparent and standardize the treatment of loans for all categories of political entity, which is not the case at present.

Second, the annual contribution limit for individuals established in the Federal Accountability Act would apply to loans as well. Loans and loan guarantees would be counted as contributions toward the $1,100 annual limit at the time they were made. This change would ensure that loans could not be used to circumvent the limit on individual contributions.

Third, only financial institutions and other political entities could make loans beyond that $1,100 limit. This change would mean that unions and corporations would now be unable to make loans consistent with their inability to make financial contributions. They could not disguise contributions as loans, which is a possibility under the current law.

Lastly—and I will come back to the importance of this proposal shortly—the bill proposes to tighten the rules for the treatment of unpaid loans to ensure candidates could not walk away from unpaid loans. Riding associations, or the guarantor if there is no riding association, would be held responsible for unpaid loans taken out by candidates.

In the previous session, the Standing Committee on Procedure and House Affairs devoted careful study to the provisions of this bill and, after recent deliberations, has reported it back to the House with amendments.

Several of these amendments are valuable additions to the rules governing the treatment of loans, because they make the system described in the bill more equitable.

Notably, a change has been put forward by government members and supported by our opposition counterparts to exclude from the annual contribution limit any portion of a loan that is repaid to the lender and any unused loan guarantees. The effect of this change is to allow a lender, whose loan has been repaid or whose guarantees have been unused, still to contribute up to the annual contribution limit.

A change has also been put forward by our former colleague from Vancouver--Quadra, Mr. Owen, to require the Chief Electoral Officer to hear representations from affected interests before making a determination about a deemed contribution. This change, although technical in nature, would ensure certainty and uniformity in procedural fairness in dealings with Elections Canada.

There was also an amendment to extend the period of time as to when an unpaid loan is deemed to be a contribution from 18 months up to 3 years. In the spirit of working in a minority Parliament, the government is also prepared to accept this amendment.

I commend these amendments to the House on the grounds that they improve the overall regime of political financing in the Canada Elections Act.

However, there were some unwelcome amendments from the committee.

At this time, I would like to give some credit to my colleague, the New Democratic Party member from Winnipeg Centre. He has been a strong supporter of this legislation and, in fact, championed it even before it was introduced. We appreciate the cooperation he has shown with us in helping to develop the bill and discussing it at every stage. In particular, I appreciate his cooperation and discussion on the issue of redressing the two unwelcome amendments that were proposed in committee but which the government proposes to reverse.

I thank him for the commitment he gave to this government that his party would support the effort to remove these amendments. These amendments cause the government concern because they undermine the regime that is presented in the bill. Therefore, we have put on notice, motions to amend the bill to restore certain important provisions that have been undermined by opposition amendments.

One of these unwelcome amendments provides that the contribution limits for leadership candidates be calculated annually rather than per contest, as is now the case. This change, if it were allowed, would allow contributors to bypass the legal limit on contributions to leadership campaigns if a candidate carried that debt over different calendar years or if the leadership campaign happened to overlap different calendar years.

That runs counter to the principle enacted in the Federal Accountability Act that contributions to leadership campaigns by individuals be capped at $1,100 per contest. The government considers this change unacceptable and proposes that the per event contribution limit be restored.

I appreciate again the support that the member for Winnipeg Centre has expressed to us on behalf of his party for that amendment. We are optimistic that, with the support of the New Democratic Party, we should be successful in restoring the provisions originally intended to achieve accountability and political loans on that level.

The second unwelcome amendment removed from the bill is the provision that a riding association would assume liability for the unpaid loans of an endorsed candidate. The change proposed by the opposition would allow political candidates to walk away from debts incurred in campaigns. This is contrary to the spirit of accountability in the bill.

This proposed opposition change would undo one of the most important accountability enhancements presented by the government for the treatment of loans, an enhancement that would create greater certainty about the responsibility for unpaid loans.

The original form of the bill, which we are seeking to restore, not only would ensure principles of financial accountability at the local level, but would also encourage local riding associations to work more closely with their candidates and their campaigns. Again, I appreciate the support and the commitment that the New Democratic Party member gave on behalf of his party to the government and to myself for our efforts to restore the bill to its original form on this issue of trailing debt from campaigns.

A similar rule applies at the provincial level of my home province of Ontario. Section 44(4) of the Ontario Election Finances Act provides that any eventual provincial candidate's financial deficit is assumed by the local riding association. This has worked very well in Ontario at the provincial level, and opposition concerns, which resulted in the provision being amended in our bill at committee, are clearly ill-founded based on the very successful practice experienced by all of the three major parties in Ontario in dealing with the bill.

The government is, therefore, proposing to restore the provision that a candidate's registered association, or registered party if there is no registered riding association, would become liable for the unpaid amount of a loan that a candidate does not repay.

Finally, I would like to point out that there is a technical amendment required to clause 5 of the bill. That clause was amended at committee and the language employed about when a loan is deemed to be a contribution ought to be made consistent with the defined terms used throughout the Canada Elections Act. We are, therefore, proposing that the language be clarified.

In all, these are amendments that are reasoned and principled and serve the overriding principle that accountability be strengthened for the use of loans as a political financing tool.

We are committed to cleaning up campaign finance. We are going to move to do that as we move forward--

Speaker's Ruling

[The Speaker, Liberal, Peter Milliken]

There are three motions in amendment standing on the notice paper for the report stage of Bill C-29. Motions Nos. 1 to 3 will be grouped for debate and voted upon according to the voting pattern available at the table.

I shall now propose Motions Nos. 1 to 3 to the House.