Procedure and House Affairs Committee on Oct. 18th, 2012

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

First of all, this bill itself treats all parties, candidates, all political entities, equally. Everybody is on a level playing field.

With respect to the banks in Canada, as I said, there are literally hundreds of them right across the country that can provide this service. Banks are competitive. Banks are highly regulated. We have some of the best regulated banks in the world, and financial institutions.

Further to that, the transparency rules would go a long way to ensure that Canadians know exactly who provided a loan, by which financial institution, who guaranteed it, and what the amount was, and to make sure that it was an interest rate at fair market value.

All of this would be very transparent and very public.

[Alexandrine Latendresse, NDP, Louis-Saint-Laurent, QC]

We know that it is currently more difficult for a woman or someone from a first nation to secure a loan from a financial institution. This is an acknowledged statistical fact.

We want to try to help people and get more women, youth and first nations people into politics, but by stipulating that only financial institutions can make loans, are we not running a risk? Are we not running a risk of putting women and the first nations at a disadvantage?

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

When it comes to women or minorities getting into politics—which is important, and we need to do that—the real disadvantage is in giving a huge advantage to those who may be wealthy themselves, or may have wealthy family and friends, or may be well connected with any corporations or unions. Giving them the advantage is a disadvantage to others.

Creating that level playing field is exactly what will help the situation.

[The Chair, Conservative, Joe Preston]

Thank you.

Monsieur Garneau, seven minutes.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you, Mr. Chair.

Thank you, Minister, for being here.

I'm glad we're going through this bill. I want to bring up one point, though, and that is the fact that banks and lending institutions are there to make money. They are always concerned, first and foremost, with a person's income or credit rating. I agree with the intent of this bill, but let's look at it in terms of discrimination.

Let's say a woman decides to run. She has been out of the workforce for some time. Her credit rating or her income level perhaps is not ideal in terms of taking out a loan. There is nothing at this point to prevent the bank—or she may go to a range of institutions—from saying that they're sorry but they don't believe she's an acceptable risk. Of course, that wouldn't appear anywhere. It would just be the fact that the person could not get a loan, and in some cases may not be able to run as a result.

It could be a 19-year-old or a 20-year-old; we have a few 21-year-old members of Parliament. They have not had a chance to build up a huge credit rating.

Is there a way we can make sure that the worthy candidate chosen in a particular riding would have the same possibility as would somebody else, or is this basically saying that it's tough luck if they can't get a loan and it's nobody's fault?

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

First of all, I agree with you that banks are in the business of not only making money but also lending. That is where they make their money. They would, in this case, receive interest from the loan as well, so they would make money from it. There are hundreds of options to approach right across the country.

What we have seen in Ontario, which has similar provisions in the sense of getting a loan from a bank, restricting it to financial institutions, is that they have made those decisions based on your rebate. As federal politicians, when we run, we receive a rebate if we get 10% of the vote.

As you said, if a viable candidate is going to receive 10% of the vote—which is well below viable; to be a viable candidate the person would likely receive more—the candidate can guarantee his or her rebate over to the bank. The bank can make that assessment based on the rebate, not based on the person's personal wealth, personal credit, or other personal situations. This would be based on the rebate they would receive.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Okay. In this case, the bank may have to make a value judgment as to whether that person is capable of getting that 10%, and therefore having that as collateral, if you like.

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

Correct.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Okay.

My second question is technical in nature. Let's say I'm a candidate and I'm either elected or not elected.

[An hon. member]

I think it's an announcement.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

No, no, thank you very much. I'm talking about something else.

Let's say either elected or not elected, it takes three years before it becomes a contribution. Just to be 100% clear, can somebody donate $1,200 to me every calendar year until that three years, as opposed to one time only from each person?

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

Correct. This would change that.

I have one quick point regarding the banks basing their assessment on the rebate. That's up to the bank, but that's how it's been done in Ontario. That's how some of them have received that. They get to choose that.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Okay.

My final question is this. Do we have a sense from banks and other institutions as to how they feel about this? Are they comfortable with this, or have they signified they're uncomfortable with having this role thrust upon them? There will be lights on them. Obviously, elections are fairly visible events. Are they comfortable with it?

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

Currently, banks do provide political loans across the country. In Ontario where similar laws exist, it has been working well.

[The Chair, Conservative, Joe Preston]

Thank you.

A four-minute round, starting with Ms. Rempel. We're happy to have you here today.

[Michelle Rempel, Conservative, Calgary Centre-North, AB]

Thank you, Mr. Chair. It's great to be at this committee for the first time.

In your speech, Minister, you made a statement. You said, “Neither voters nor candidates should have privileged access to the political system solely because of their financial resources or wealthy contacts.”

This speaks to me very profoundly because all of us around this table often get asked why we run. For me, one of the honest answers I usually give is because I can. I'm the youngest member of our caucus. I'm a young woman and there are many parts of the world where women don't have the legal ability to run. Moreover, when you look at other political systems, their financing laws are a major barrier to entry for women.

It is particularly timely to be discussing this when you look at what's happening in the American election, the amount of money that is spent on campaigns, on advertising, on these enormous campaigns, literally millions of dollars. I can tell you right now if I had to participate in that political system, I would not be an elected representative simply because of my age and my family's wealth status, etc.

I think that statement is really profound because we know that financing can be a barrier to entry for women.

When you look at financing as a barrier to entry, some of the determinants are that many women choose to have caregiver roles or choose to take other positions where it often becomes difficult to build the network of contacts that is needed to finance a campaign.

Specifically, in my experience where I sought a nomination for the party, where traditionally there is a good base of support for the party I represent, nomination financing is an issue as well.

I wanted to ask you some questions along that line. You spoke about having that level playing field, about ensuring that women have access. I think, first of all, the Canadian political system, our financing rules, the $1,200 contribution baskets that we have in place remove that barrier to a large degree. I certainly have experienced that in trying to raise funds to finance my own campaigns.

This provision is a great addition. If you do have access to wealthy contacts across the country in different areas, if you do have that pre-established network, it does give you a leg up. I think this provision removes that. Would you characterize that as correct? Perhaps you could talk about your own situation as well and how you would see that changing.

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

You're absolutely correct and this is something I've heard when speaking to people right across the country of how levelling the playing field really would help the situation.

You mentioned nominations. Already we have caps on how much you could spend in a nomination. It's 20% of your overall cap. In most parts of the country that's between about $8,000 or $9,000 up to about $15,000. That already generally levels the playing field. Further, for somebody who can fund their whole nomination themselves because they have a lot of money, it takes that advantage away. It levels the playing field not only for young people, but also for women.

Myself, I often comment that it's quite rare in any country for the son of an immigrant who drove a cab, who worked in the coal mines to end up being a member of Parliament, but the opportunities were given. This bill would go farther to help in that situation as well.

[The Chair, Conservative, Joe Preston]

You have 10 seconds.

[Michelle Rempel, Conservative, Calgary Centre-North, AB]

Maybe you could expand upon some of the comments that were made with regard to the banks being able to participate in this process adequately.

[The Chair, Conservative, Joe Preston]

I hope the minister will get the chance to answer that under someone else's time.

Mr. Scott, you're next, for four minutes.

[Craig Scott, NDP, Toronto—Danforth, ON]

Thank you, Mr. Chair.

Thank you, Minister, for coming.

I have two questions to ask in my four minutes. The first is to return to the clarification that Mr. Lukiwski received on retroactivity, which is with respect to the period of leadership loans. The new system is that you can have somebody donate on a yearly basis and not just on a per-event basis.

Did I understand correctly that the interpretation is that the new Bill C-21 provisions would allow past leadership candidates to actually pay off old loans under this new arrangement? If so, is it clearly in the new provisions?

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

I'll let Matthew get into the technical wording of that.

[Matthew Lynch, Director, Democratic Reform, Privy Council Office]

The bill comes into force six months after royal assent. Generally speaking, the provisions governing loans are not retroactive but, with the change to the contribution limits for leadership contestants, would apply to anybody who continues to be a leadership contestant upon coming into force.

[Craig Scott, NDP, Toronto—Danforth, ON]

No, I understand. That was the answer before, but how clear is that and where are we getting that? The only retroactivity clause is 34 of Bill C-21 and it is not at all clear that is the result. I am wondering if more clarity is needed or if I haven't found it in the provisions.

[Matthew Lynch]

The contribution limit in proposed section 405 would be applied once the act comes into force. It would no longer be a per-contest limit but an annual limit.