Evidence of meeting #56 for Procedure and House Affairs in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was loans.
A recording is available from Parliament.
Conservative
Tom Lukiwski Conservative Regina—Lumsden—Lake Centre, SK
Then it's relatively easy for candidates, whether they are male or female, to enter into an agreement with a bank, as long as their riding association has some financial ability. They can literally use 50-cent dollars to help finance their own candidate.
I'm not sure. Does Ontario have a 50% rebate?
Conservative
Tom Lukiwski Conservative Regina—Lumsden—Lake Centre, SK
Then we're talking about 80-cent dollars. Federally it's 50% to 60%. I didn't realize it was only 20% of the eligible amount.
Director, Election Finances, Elections Ontario
On the campaign expense subsidy for a candidate, if you receive more than 15% of the popular vote, you can get back 20% of the campaign expense limit, or whatever you spent, whichever is lower.
Conservative
Conservative
The Chair Conservative Gary Goodyear
Thank you very much.
Does anyone from the Bloc have questions?
Monsieur Guimond is next, and then Mr. Godin.
Bloc
Michel Guimond Bloc Montmorency—Charlevoix—Haute-Côte-Nord, QC
Thank you, Mr. Chair.
Thank you for coming to testify before us, Mr. Stockfish. I have two quick questions to ask you.
First, under the Election Act of Ontario, are the parties ultimately responsible for loans taken out by candidates?
Second, are parties required to lend money to candidates or associations at current commercial rates?
Given that I made no introduction, that I am surprising myself with my speed this morning, and that I am impressed with myself, I am going to ask a third question and get a full meal deal like at McDonald's.
Third, in Bill C-54, if a party grants a loan to a candidate or to an association, and if the rate is lower than the market rate, for example if the market rate is 7% and the party lends money at 5%, we consider that the 2% difference would be seen as a contribution, and so could show in the books. Does Ontario have a similar provision?
Thank you, Mr. Chair. Those are my questions.
Director, Election Finances, Elections Ontario
On the first question, any liability that remains at the end of a candidate's campaign becomes the responsibility of the constituency association. So if a candidate has a loan outstanding at the end of the campaign that they haven't repaid, it becomes the liability of the association. If the association were to be deregistered for any reason, its liabilities would become the liabilities of the party. There is a link there, but on the campaign itself, the candidate's loans would fall to the association.
On the second question, a candidate can receive a loan from a party or an association, but it has to be at a market rate. They cannot lend money at a commercial rate--depending on the terminology. If they were to lend money at a rate below the market rate, that difference would become a contribution and would need to be receipted and charged against the contribution limits.
Bloc
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Thank you, Mr. Stockfish, and welcome.
That is the reason why it is better for a political party to give a candidate money rather than to lend it, correct?
Let's say that the constituency association goes to a financial institution for a loan. First, in Bill C-54 only a loan of $1,100 can be guaranteed, and if someone has made a contribution of $1,100, he cannot then guarantee a loan. No guarantee can be made because it is the same as a contribution.
If the association makes the loan, can the association president, the election agent or anyone who signs the loan also give $1,100? Are these people just guaranteeing the loan, or do they represent the association? Is my question clear?
Director, Election Finances, Elections Ontario
I wasn't sure whether that was a statement or a comment around whether it was better to transfer or not.
NDP
Director, Election Finances, Elections Ontario
But I was going to state there is the ability within our legislation for the transfer of funds to go—So a candidate could receive either a loan from a party or could receive money transferred.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
And if the money is transferred, then there is no interest on it, right?
Director, Election Finances, Elections Ontario
As for the second question, there's a difference in Ontario, in terms—
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Did you understand what I said when I was talking about the guarantor? If the association made the loan to the institution, would they become the guarantor, or would they just become an association and not be counted as a guarantor, because it would then just be the association? The association could make a loan of $20,000, whereas a guarantor could only make a loan of $1,100.
Director, Election Finances, Elections Ontario
From the Ontario perspective, I don't think it makes a difference, because if you guarantee a loan in Ontario to one of the political entities, that does not get charged to your contribution limit. The limit to contribute to a constituency association is $1,120. So you could contribute that $1,120 to the association. If that association were to borrow money from a financial institution and you stood up as a guarantor for $10,000, that guarantee does not get charged—
NDP
Yvon Godin NDP Acadie—Bathurst, NB
Where Bill C-54 will do it, then we have to study what will happen. If an association wants to borrow $20,000, do they need 20 people in the association to make the loan? It's a question that should be answered, but you don't have that answer.
Director, Election Finances, Elections Ontario
To be honest, I'm not in a position to pass judgment as to what works and what doesn't work in terms of Bill C-54. I've certainly read it and I understand it, but this gets back to my earlier comment that it's part of a bigger framework. The election finances framework and the philosophy behind it are determined by the legislators. So there are distinct differences in Ontario versus federally. But if you guarantee a loan in Ontario, that does not get charged against your contribution limit.
NDP
Yvon Godin NDP Acadie—Bathurst, NB
As you read Bill C-54, do you see any problem for a woman to run, compared to previously? I do not know if you have studied the bill at all. We know that even if women can take out loans these days, I think that the big loans still go to men.
In Ontario, have you seen the previous situation change since you passed your bill?
Director, Election Finances, Elections Ontario
There's been no evidence of a difference between males and females, but again, we haven't done any research in that regard. Our system is distinctly different from what's proposed in Bill C-54, from the vantage point of the contribution limits and the $1,100.
I really can't pass judgment in terms of the lending practices.
I don't get the sense that there is a distinct disadvantage for certain groups versus others with the system we have in place.