Procedure and House Affairs Committee on Nov. 2nd, 2010

[The Chair, Conservative, Joe Preston]

We'll call the meeting to order, please.

This is the 29th meeting of our Standing Committee on Procedure and House Affairs. Pursuant to Standing Order 32(5) and the motion adopted by the committee on Thursday, September 30 on the report of the Chief Electoral Officer of Canada, entitled “Responding to Changing Needs”, we're studying recommendations from the Chief Electoral Officer of Canada following the 40th general election.

This committee will hear witnesses to that effect today.

We have with us Brad Lavigne from the New Democratic Party of Canada, Gilbert Gardner from the Bloc Québécois, and John Arnold from the Liberal Party of Canada. I believe that by now all of you have received a written report from the Conservative Party of Canada. They were not able to attend today.

We will offer each of our witnesses an opening statement of up to 10 minutes.

Please share with us your thoughts of what you've heard from the Chief Electoral Officer. Then we will have questions from members for as long as it takes for them to get the information they need out of you.

I always like to caution the witnesses that this meeting takes place from eleven o'clock to one. Some of the members will be having their lunch while you're giving your answers. Please don't feel we're being rude. It may be the only chance any of them get to eat today so we'll do that. Also, you know that we're busy people, and some of us will be answering phone calls and doing other things while you're here. Again, we're not trying to be rude. We need the information you're here to share with us, but we also try to multi-task as much as we can.

Mr. Lavigne, we're going to let you go first and give your statement. We'll hear each statement and then we'll do questions from all.

You're up.

[Brad Lavigne, National Director, New Democratic Party]

Very good. Thank you very much.

On behalf of the New Democratic Party of Canada, I would like to thank the committee for the opportunity to comment on the report of the Chief Electoral Officer of Canada, entitled “Responding to Changing Needs”.

In his report, the officer reviews many of the worthy areas governing Canada's election laws and procedures, but today I'd like to focus my comments on proposals that concern two areas. The first area is increasing voter accessibility. The second area from the report is reducing the regulatory burden.

Turning first to increasing voter accessibility, there are two sections in the officer's report. The first one is the registration of electors by the Internet. New Democrats agree with the Chief Electoral Officer's desire to make up for the gross inadequacies of the current so-called permanent voters list through online registration and the ability of every voter to update their information quickly and easily online. Making it easier to include yourself on the voters list, or to update your vital information on it, increases the accuracy of the list and therefore the integrity of the system. The status quo is insensitive to the ever-changing needs of a mobile population, including districts with high rental populations, aboriginal communities, and resource communities with ever-changing workforces. To participate fully, these communities require the voters list's process to enter the 21st century.

Now, the permanent voters list has created many challenges. Today's list, compiled within the parameters handed down to Elections Canada, is out of date and far from adequate for a modern democracy. Until the day Parliament returns to a full enumeration, it should give the Chief Electoral Officer the tools to stop the bleeding of the integrity of the current voters list.

The second area on accessibility is the issue of vouching. The Chief Electoral Officer further recommends allowing electors to vouch for more than one elector in the case of immediate family members. This would apply to vouching in order to prove an elector's identity and residence before voting, while registering to vote in an advance poll, and while registering to vote on polling day.

The New Democrats disagree with the proposed changes. We believe there needs to be better mechanisms to prove identity and residence. From our experience, the lack of identification is a problem for homeless voters and where identification is not used on a regular basis. The problem for these voters isn't that they're the only ones in their immediate family without ID; it's that they don't have ID, don't have an address, or don't have family members in the same district.

There is also a credible concern about fraud if individuals have the ability to vouch for many voters.

The second area is reducing the regulatory burden. The first area I'd like to touch on this morning is the pre-confirmation transfers to candidates.

For Canadian democracy to flourish within the current electoral system, we need both well-organized central political parties and strong local campaigns. One step that will allow for stronger local organization is to lift the restrictions currently placed on registered political parties and electoral district associations to transfer funds, goods, and services to local candidates at any time, notably before the writ period.

New Democrats have experienced difficulties with the existing terms of the regulatory timing for transfers. We've also had delays with confirmations, which are problematic and can involve waiting for confirmations until, in some cases, mid-campaign. This is unacceptable, and it is choking local democracy. Therefore, we strongly support advance confirmation transfers to candidates.

Next is the requirement for a candidate's return to be audited and the opening of a bank account. The heart of local campaigning is the dedicated volunteers of all political stripes and backgrounds who volunteer their precious time from their busy lives to make their community and their country a better place. However, on far too many occasions the unnecessary regulations placed on even the most modest of campaigns can suck the soul from well-meaning local campaigners, turning them off of federal democracy due to unnecessary paperwork.

Therefore, we concur with the proposal to lift the regulatory burden on local campaigns by, first, ceasing the requirement to open up a separate bank account even though the campaign does not conduct any financial transactions; no longer requiring audits for local campaigns that get less than 10% of the vote and that do not receive contributions or incur expenses of more than $10,000 with their campaign return; and finally, removing the requirement for audit reports on updated returns.

These three changes alone would go a long way to help reduce the burden on the parties' smaller campaigns and at the same time free up Elections Canada resources to pursue more pressing matters.

Next is the extension for filing returns. We agree that the current regime for seeking extensions of time for filing returns is a flawed one. The grounds for allowing extensions are too narrow, the existing regime puts the procedures in the hands of the courts far too early, and the existing regime is not effective in promoting the timely filing of returns.

We agree that the Chief Electoral Officer should be extended the ability to grant extensions and crack down on parties that are acting in bad faith. But we are in complete disagreement that the penalty for acting in good faith but missing the deadline should cost a local campaign $500. Quite simply, this fee will not serve as a deterrent where the late filing is out of the hands of the local campaign--for example, when the supplier is the holdup.

Many of the electoral district associations that have the most trouble securing documents on time, or that face unexpected circumstances such as illness or a sudden turnover, are what we consider the low-resource ridings, where $500 would mean a lot. As such, this component should not be considered an effective or suitable measure to increase compliance.

Next we have the payments and reporting of outstanding claims, including loans. On the issue of compliance, I'd like to touch on the issue of reporting of outstanding claims, including loans. We agree with repealing the proposed language in the case of nomination contests and candidates; however, we believe that the existing provisions for leadership contestants already provide adequate time for managing unpaid claims.

For candidates and contestants, the four-month period for paying all claims following an election is particularly challenging considering that in many cases rebates from Elections Canada can take many months beyond that deadline. We agree that amending the period to 18 months is an effective measure that will reduce the number of requests for extensions, while still providing timely reporting.

We support the flexibility to transfer the local campaign debt to the local electoral district association; however, we disagree with transferring local campaign expenses or nomination claims to the central party. This would merely transfer the accountability away from the local decision-makers to central officials who had no role in incurring the debt to begin with.

A ban from serving as a candidate or a contestant seems inappropriate in instances where the unpaid claims were unavoidable, such as disputes with suppliers.

Next, the creation of an offence for having unpaid claims after a certain period of time merits further investigation, and it could provide a suitable consequence.

Finally today, I'd like to comment on changes to how leadership contests are governed by the act, notably chapter II, section 11, “Contributions to Leadership Contestants”, a.k.a. the “per contest” limit, and the leadership contestant aspect of chapter II, section 8, payments and reporting of outstanding claims, including loans.

Firstly, we disagree with the proposal to move from a “per contest” limit imposed on contributions to leadership contestants to an annual limit. We do not agree that this will bring about the desired transparency, as this will allow for multiple donations to the same candidate for the same contest.

Secondly, the challenges to the system are not embedded in the frequency of reporting of a leadership debt, but rather the inability of the Chief Electoral Officer to impose firm deadlines for when claims for leadership contests must be paid.

In the past few years, we have done much to clean up our election financing in this country. We have taken big money out of politics. We have eliminated corporate and union donations. We have brought in limits on donations from individuals. We have begun to level the playing field.

But there is still more work to be done to ensure fairness, to ensure that those who are well connected aren't finding loopholes to stretch the rules to their advantage over everyone else. We see this particularly when it comes to outstanding loans on leadership contests. How can it be, as we approach the fourth anniversary of the Liberal Party of Canada's leadership race, that seven contestants, all sitting members of Parliament, collectively still owe $890,000 in leadership contests?

The era of entitlement was supposed to be over. With many of the recommendations of the Chief Electoral Officer and the continued diligence of this committee, we'll bring about the election financing regime that serves all Canadians fairly.

I thank the committee for its time today. I look forward to any questions you may have.

[The Chair, Conservative, Joe Preston]

Thank you, Mr. Lavigne.

Mr. Gardner, it's good to have you back. It's your turn.

[Gilbert Gardner, General Director, Bloc Québécois]

Thank you, Mr. Chair.

Thank you for inviting me.

Broadly speaking, the Bloc Québécois is mostly in favour of all the recommendations. I am going to go over about ten of them specifically.

In part I, recommendation I.2 on the appointment of deputy returning officers suggests that the deadline for submitting the names for the appointment be moved up. This recommendation is the result of a problem experienced in western Canada where few names are submitted to the polling station officers, which is very different from the situation in Quebec where a specific number of officers are recommended to the Chief Electoral Officer within the timeframe set out in the act.

It is now asked that the date be moved up with two objectives in mind—the Chief Electoral Officer will have more time both to recruit individuals and to train them.

That does not pose a problem as long as the people are not sworn in faster. Most recommended individuals are party faithful and swearing them in denies them the right to be active, especially if this is done too early and serves no real purpose.

Recommendation I.8 on the protection of personal information proposes that the date of birth be removed from the documents submitted to deputy returning officers and poll clerks. We agree with removing the day and month of birth, but the year should be kept. That would allow deputy returning officers to determine, for example, that the person in front of them who claims to be 80 years old looks only 20. The year of birth would draw the officers' attention. The day and month are not very important, but we feel that the year is a way to catch people, even though the deputy returning officers cannot ask this question directly. But they can very well see first-hand if there is a discrepancy between reality and the electors' claims and, as a result, they could decide to ask for more information.

As to recommendation I.9 on the partisan signs outside polling sites, there were problems in the past in some municipalities because of the limited commercial space available for the offices of political parties and the returning officer. On a few occasions and in several constituencies, space for the returning officer was rented in a shopping centre, which also housed the offices of political parties. So, the procedure should be specified in those cases. The 100-metre radius rule also seems a little much to us.

In part II, the provisions on surplus introduce a procedure that would go as far as selling assets acquired during an election campaign. I feel it would be much simpler to make mandatory the transfer of all assets from the candidates to the party they represented. Then, if there is a formal obligation to turn over the assets to the party that the candidate represented, the Chief Electoral Officer will be able to achieve their objectives. In other words, making this transfer mandatory will prevent candidates from profiting from the election.

In terms of recommendation II.7 on the candidates' debates, I think we should keep the current framework. The fees incurred by debates cannot be considered election expenses under section 319 of the Election Act. I feel the legislator's intent is clear and no amendment is necessary.

As to recommendation II.15 on a superseded election, we agree with the proposal, with one exception: the reimbursement rate. We recommend that the reimbursement rate be the same as the one used in the cancellation of the byelections in Saint-Lambert and Westmount—Ville-Marie in 2008, meaning 100% instead of 60% so that the candidates who go through the cancellation of a byelection are not penalized.

In part III, recommendation III.5 deals with the presence of the media. We fully agree with the recommendation of the Chief Electoral Officer to allow the media to be there when party leaders vote.

But I think there is a mistake in the French version. It says: “...et des candidats qui s'y opposent.” If candidates are opposed to the idea of being filmed during their vote... Something does not make sense, a mistake, I have trouble understanding.

Let's look at recommendation III.6 now, which deals with the right to strike. The Bloc Québécois is against taking away the right to strike from Elections Canada officials, just as we are for our party's unionized staff. There is no restriction on the right to strike, especially when elections could happen at a moment's notice, with a minority government. That would actually mean taking away the officials' right to strike permanently. We are opposed to that.

Finally, let's look at recommendation IV.10, which deals with judicial recount and states that it is the elector's responsibility to notify the returning officer of a request for judicial recount. We are in favour of that as long as there are no additional delays in the whole judicial recount procedure.

Thank you.

[The Chair, Conservative, Joe Preston]

Thank you very much for your opening comments today.

Mr. Arnold, you're up.

[John Arnold, Senior Director, Regulatory Compliance and Administration, Liberal Party of Canada]

Thank you.

I'd like to thank the committee for allowing me to replace our national director, who was not available to attend.

One of my roles at the office is that of dealing with regulatory compliance. I have been at the Liberal Party of Canada for 16 years, and while my focus is on the financial side, we had our political operations staff also go through the report to provide us with the input to respond today.

I'd also like to acknowledge that Elections Canada did seek the opinions of the party on this about a year ago and then followed up in December with a session for all the parties that had made submissions to them to discuss their points of view and also seek additional aspects of the recommendations we made. That was much appreciated.

We have comments on 10 points. I'm going to limit my discussion to those 10 points.

I will start with recommendation I.9 on partisan signs outside polling sites. Similar to what my colleague at the Bloc Québécois said, the limit of 100 metres from the entire property presents possible difficulties, particularly, say, in a smaller community with a large shopping mall in which both the returning officer and the candidate have located their offices. We would be amenable to a distance of 100 metres from the front entrance with such signage on public property. We don't think there should be a limitation on private property.

On recommendation II.1, documents supporting the parties' financial returns, if you will allow me, I'd like to read our short two-paragraph submission to Elections Canada on that. We said:

While we acknowledge that the “Chief Electoral Officer does not receive any documentary evidence of the expenses listed in the return”, he does receive an independent Auditors' Report on the Registered Party Return in Respect of General Election Expenses and the Registered Party Financial Transactions Return.

Rather than Elections Canada using public funds to re-audit financial records that have already been audited by a public accountant, we would recommend that the Canada Elections Act be modified to include a broadening of the scope of the audit, including specific procedures if warranted, and require the auditor to provide a specific audit report to the Chief Electoral Officer that will meet the needs of the Office. If you do proceed with this recommendation, we would respectfully suggest that any changes in the Auditors' Report be agreed to with the Canadian Institute of Chartered Accountants prior to changing the statute.

On recommendation II.2, reimbursement of election expenses when limit exceeded, we believe a graduated system of reduction would be more appropriate, perhaps in a manner similar to that used for major league baseball. For example, an expenditure of up to 10% in excess would be dealt with on a $1 for $1 reduction. But an expenditure of--and I'm using these as guidelines or suggestions--perhaps 10% to 25% might be dealt with on a $1 for $2 reduction, etc., moving forward.

On recommendation II.3, failure of deregistered electoral district associations to file outstanding financial returns, we believe the current environment for deregistered EDAs is sufficiently embarrassing to a party and, as such, do not believe the harsher penalties are warranted. In the last year and a half, I believe, the Office of the Chief Electoral Officer has stepped up the enforcement of compliance with the act for the EDAs. As a result, we've seen a number of deregistrations, and I think the parties have started to notice this.

On recommendation II.5, offences for filing a campaign return with false or misleading statements or filing an incomplete campaign return, there are a host of reasons why a candidate may wish to present themselves in an election. Financial acumen does not need to be a mandatory requirement. A candidate relies on the integrity and professional capability of their official agent, especially given the ever-increasing complexity of the political financial regulatory framework. Even if a candidate were made responsible for filing a false or misleading return, those candidates without a financial background would be signing blindly. As such, we do not believe this measure will achieve any positive outcome.

Regarding chapter II, number 8, treatment of candidates' outstanding claims, we agree with the recommendations and suggest that Elections Canada go one step further and eliminate the unpaid claim approval process for the regular day-to-day operations of a party and electoral district associations. In their report, they mention that they weren't touching parties' electoral district associations. We believe they should look at those as well.

On chapter II, number 9, extensions of time for filing financial returns, we agree with the recommendations of the Chief Electoral Officer and believe the second option of a graduated penalty would be most appropriate. That ties back into our graduated penalties for over-expenditures as well.

Next is chapter IV, number 10, judicial recount, notice to the returning officer. Given the possible disagreement of the returning officer and the candidate regarding a judicial recount, we believe that the recommendations should be modified to require the notification of the returning officer within 24 hours of having filed the judicial application.

Regarding chapter IV, number 11, removal from the national register of electors by an authorized representative, we believe this recommendation should be modified to only remove the name once the elector is deceased.

For recommendation chapter IV, number 12, commercial value deemed to be nil, we agree with a more precise definition of commercial value being deemed to be nil, but question whether the definition should be broadened to limit these contributions to a Canadian citizen or a permanent resident of Canada. As an example, currently a landed immigrant who has not received their Canadian citizenship or their permanent residency status is allowed to participate in the electoral process--by driving electors to the polling station, say--in a manner similar to the example on page 118 of the Chief Electoral Officer's report.

We believe these types of contributions should be allowed to continue. Otherwise, the effort involved by an official agent in determining the eligibility of the contributed goods and services would increase the administrative effort to monitor these types of situations, which we conclude is the opposite intention of the exemption provision. Additionally, we're concerned about the $200 limit being tracked on a cumulative basis. To do so would require the official agent to develop a tracking system for all levels of contributed goods and services under $200, which again seems to run against the intention of the exemption provision of reducing administrative requirements of small amounts.

Those are our 10 points.

[The Chair, Conservative, Joe Preston]

That's super. Thanks to all of you for being concise today.

We have a number of witnesses today, so I think I'd like to start off with a five-minute round, and we'll be reasonably strict with the time. We'll try to give a chance to everybody who wants to speak today, so let's go ahead.

Madam Ratansi.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Thank you.

Five minutes? Fine, I'll be very quick. I'll make two comments and then I'll have a question.

On the 100-metre rule, I think it would be unfair if I were living near a polling station and wanted to put up a sign and somebody denied me the right to exercise my democratic right to show my support to whichever party I wanted to show it to. So I agree that people are in agreement with that--except one party.

My second question is on the registration by Internet. I was wondering whether anybody has any concerns about fraud or what sort of checks and balances can be put in place to have registration of electors by the Internet.

The third thing I want to ask about is vouching. Electors should be able to vouch for more than one member of the family. I think I heard some concerns about vouching. I asked Elections Canada how many people used this system the last time, but they couldn't answer me. I know that we are all afraid of fraud or whatever. We want to maintain the credibility of the system.

My main question, though, goes to the contributions to the leadership contestant. I understand where some of the people are coming from. If I make a comparison of the democracy of Canada versus that of the U.S., and I see that in one day a presidential candidate can drop $2 million, are we trying to say that we should attract people for their brains or for their money? What are we trying to do?

Not everybody has the financial capacity, so are you going to say that you would disallow those types of people from participation in a democracy process? I don't have the capacity to raise that much money, but should I not be given the chance to run if I so wish? Why are we so stuck that this money will go to the national party, etc.?

I'd like your input--from Mr. Arnold first, and then I could likely go around the table--as to how we could improve the system. It has been done in the past. We want to improve the system. How do we go about improving the system and increasing democratic participation?

Thank you.

[The Chair, Conservative, Joe Preston]

Good. We're at two and a half minutes, so we have two and a half minutes for answers from the three of you.

Mr. Arnold, you're first.

[John Arnold]

Well, the Liberal Party of Canada has been through a number of leadership conventions over the past number of years, and we've worked extensively with Elections Canada on trying to define exactly what the rules are.

I understand that there might be concern about allowing multiple-year contributions to a leadership candidate, but I would say that we already have that concept in electoral legislation. An individual can donate to an electoral district association every year; that money can then be transferred to a candidate during an election. So we have the concept: why would we want to limit it on the leadership convention?

I do understand why there might be some concern about raising large amounts of money that create a surplus in a leadership campaign and which would then go to a political party. Although the Canada Elections Act does include broad anti-avoidance provisions, similar to the Income Tax Act, perhaps this could be dealt with by requiring the surplus to be made payable to the Receiver General for Canada.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Mr. Gardner, please.

[Gilbert Gardner]

I would like to discuss two of the points you raised. In terms of Internet registration, our position is that new projects could be submitted, but as pilot projects. And the committee should first approve them before they are tested. Ideally, we should test these pilot projects more during byelections.

The consequences are actually more contained in this case. Control and evaluation are much easier in one constituency than in 308. I think we have to be open to new technologies, but we also have to be cautious to avoid them going off the rails.

As to the guarantor, we told the advisory council of Elections Canada that we were in favour as long as it was very clear that it was only the immediate family. We could very quickly get to a second cousin once removed or something and then there would be complete chaos. It must be the immediate family.

[Brad Lavigne]

On the first issue of the Internet registration and verification of information, I draw the attention of the committee members to page 28.

Both Alberta and British Columbia already offer electors the option to register online, as well as to verify and update registration information. Quebec currently is going through a system whereby you can update your information online during an election. Elections Ontario is currently investigating or developing online voter registration. I think the provinces, by and large, are leading the way.

I would also suggest, to answer your question specifically, that the fear of fraud is something that I think the private sector has also driven some good paths on. A number of years ago when the issue of online shopping and consumer identification came up, there obviously were some concerns. But I think today you would see a lot more confidence in the private sector about online verification of information of individuals for acquiring consumer goods or services.

It's a 21st century population out there. We're using online means to do everything, particularly the younger generations. I know it's a cliché, but it's very true. Also, I note, more and more seniors are online. This institution has to catch up with where the voters are.

If we are concerned about voter turnout or worried about disenfranchisement, particularly among vulnerable communities, whether of new Canadians who are new to the system, first nation and aboriginal Canadians on reserve, or folks who don't have necessarily access to the information on how to vote on an ongoing basis for a variety of reasons, we need to expand the opportunity for them to sign up online.

As for the issue of vouching, I certainly spent a portion of my remarks today on the issue. I don't believe, from our work in the last number of campaigns, that the biggest issue is that family members can't do more than one individual. We have some big concerns with identification, particularly among homeless individuals, as well as in first nation communities. What is being allowed for ID? Is it being recognized uniformly across the system? The notion that it's just my sister who can't vote, or my brother, or my wife because she doesn't have a driver's licence and I do.... I don't think this is going to address the issue.

As for leadership loans, well of course we want the system to be accessible in all political parties. Each political party will assess their ceiling, and their own private ceilings, obviously, in conforming with the Elections Canada Act. The issue is whether or not the loan, after a certain period, constitutes an unfair or illegal contribution.

If it does, then we need teeth, because right now all we're doing is asking individuals—seven individuals, in the case of the Liberal Party. They go to the courts to seek relief and say that they have a game plan. But some of these folks owe over $300,000, and I think that the Elections Canada rules either mean something or they don't. We either lift the burden altogether or we give the Chief Electoral Officer some teeth to go after individuals who are in contravention of the law.

[The Chair, Conservative, Joe Preston]

Thank you very much. We went three minutes over on that, so I am going to ask you to be a little more concise in your answers and very much more concise in your questions.

Mr. Reid.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Thank you, Mr. Chair.

Mr. Chair, this is just one of those observations that I throw out there, but we have a tendency to go over on the Liberal question, and then to be very precise about timing the next Conservative question. It's a source of frustration to me. I know that as an auditor Ms. Ratansi would want us to be strictly equal in how we treat all parties.

[The Chair, Conservative, Joe Preston]

I believe that she is probably pretty happy with that. I will attempt to be as flexible as possible with you, Mr. Reid.

Please go ahead.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

All right. Thank you. I don't actually want more time. I just want to make sure that we all get equal time.

I was interested in your comments, Mr. Lavigne. I've had a very similar thought: that if it becomes the established practice that such leadership debts are allowed to exist forever, then naturally one could start gaming the system pretty easily, and I think that would lead to a situation in which, at least as far as leadership contests go, big money would be back in the saddle.

The question then becomes how one deals with such debts. There are different ways, I suppose, that one could deal with them. The trouble is, I can see different problems with them.

One way is that you simply make it that the person who is the contestant is required to pay the loan back at a certain point. But if you are Belinda Stronach, to take a real example from the past, being saddled with $300,000 to $400,000 worth of debt that you have to pay back to the Receiver General is not really a problem.

You could try billing it to the party—that thought has occurred to me—but you could then get frivolous candidates. I suppose the party could have some sort of right to refuse frivolous candidates. The danger there is that this is abused in another way to keep out legitimate candidates that the party establishment doesn't want.

So I'm interested in your thoughts and the thoughts of all the people on the panel as to how, at a practical level, one deals with this problem without introducing the possibility for a different form of abuse.

Maybe we could start with Mr. Lavigne, because he has obviously put some thought into it, and then go from there.

[Brad Lavigne]

I'll be as succinct as I can.

On the issue of uploading the debt of the individual, we are not in agreement that, at the local campaign level, local decision-makers who can't fulfill the obligations under the act simply upload the debt to another entity, their parent party. We believe this doesn't provide any accountability whatsoever to the local decision-makers.

I would suggest that it's the same for leadership candidates. If you have a limit and the individuals needs to borrow for that limit, it should not be the property of the party after the individual has completed the leadership contest; in fact, quite the opposite. Perhaps there's another thing that needs to be looked at, something that is the responsibility both of the political parties as private entities--but under public laws--and of Elections Canada s well, and that is the limits: why is it that these individuals are racking up such high debt?

I think we should be looking at whether it is fair that you can rack up these debts, supersede the spirit of the laws, and then still run for Parliament afterwards and then create another bank account.

This is a concern also with another recommendation: that we take away the 18-month provision—the “per contest” provision—and go to an annual provision. For some political parties that are in constant leadership mode that might work well, but I don't think it's going to serve democracy either way. I think it's a bit of both at the political party level. But the CEO, the Chief Electoral Officer, needs teeth to go after people after 18 months, if that is when it becomes an illegal contribution. We need real penalties. I think that will persuade political parties to lower the ceilings of their election contests and provide perhaps a little built-in prudence for their elections.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

They would build in their own spending ceilings.

[Brad Lavigne]

That's right, so that they have to take on less debt, to ensure that after 18 months they pay it back or otherwise they can't run for MP again. That's an example of tightening up the provisions. I think there'd be a—

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Let me see if I understand this. If they set a ceiling and you go over the ceiling, what happens to you? I think Mike Harris, for example, went over his party-imposed ceiling when he was running for leader of that party, and in practice nothing happened to him. He went on and led the party and it all just faded away.

[Brad Lavigne]

Well, I wouldn't want to impose any observations on political parties. I think they are going to have to come out with their own internally.

But what I'm saying is that you give the Chief Electoral Officer teeth to go after individuals. Let's say that you ban them from running as members of Parliament if they supersede the 18-month repayment program. I would bet you ten to one that the political parties would make sure these guys paid back their debts. In doing so, you might create a culture in which these folks who were borrowing hundreds of thousands of dollars would ramp that down, thereby lowering the likelihood that they might supersede the 18 months.

[Gilbert Gardner]

The Bloc Québécois has by-laws that set the ceiling for the expenses of a leadership or nomination candidate. The returning officer of a constituency or at national level has the authority to dismiss someone's candidacy that... The financial report that has to be submitted before the voting period has to give the breakdown of all contributions received and all expenditures and show compliance with the by-laws. I feel each party has this responsibility as part of its democratic inner workings.

I don't think deeming a legal contribution illegal retroactively is the way to go. I believe that compliance with the maximum contribution principle as set out in the act must be guaranteed. How can a loan that's legal one day become illegal the next day? That would be very difficult. It seems to me there is an inconsistency. The people who agreed to take out the loan did so in good faith. In my view, we should not be able to change the nature of things retroactively.

[John Arnold]

The political industry has gone through a tremendous learning experience with the legislation that we've had for leadership races, which were unregulated prior to 2004. Similar to the Bloc Québécois, we have a committee that sets the rules regarding the financial envelope, the expenses and rules for leadership candidates.

It's very difficult to run a national campaign, especially previously with the Liberal Party of Canada's delegated convention, because you couldn't focus on one riding for delegates; you had to bring it national. It's very difficult to run a national campaign when you're only allowed to accept contributions of $1,000 per contributor. I think we've found that. We've changed our rules so that our next leadership convention will not be a delegated convention.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

I think it has been mentioned that there would be a leadership selection process by mail or something like that.