Evidence of meeting #53 for Procedure and House Affairs in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was million.
A recording is available from Parliament.
12:15 p.m.
Former Chief Electoral Officer, As an Individual
For election candidates, I don't see an EDA guaranteeing more than half of the limit, because that is going to be the extent of their exposure. This is how I view this scheme working that I'm proposing.
12:15 p.m.
Conservative
12:15 p.m.
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
Thank you.
I think as a practical matter—I could be wrong here—EDAs tend to fall into one of two categories. I don't think there's a normal bell curve in terms of their financial state. They tend to either have enough money that they can simply make a direct loan or donation to the campaign at the beginning of the election—which is what my riding association did for my campaign in each of the last three elections—because they've just got that much money sitting in their bank account, or else they've got almost nothing. I suspect it's one of the two.
That's not anything other than setting the grounds.
The question I actually had for you on your proposal, which I think is a very interesting and thoughtful proposal, is.... First is just a technical question. I'm assuming you are saying that in riding X you could have the Liberal, Conservative, and New Democratic parties all decide independently in their EDAs to loan three different amounts to their own candidates. Would that be...?
12:15 p.m.
Former Chief Electoral Officer, As an Individual
That's entirely true. It would vary based on the party, based on the EDA, and some EDAs may not be able to afford anything.
12:15 p.m.
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
I just wanted to ask that question to make sure I understood correctly.
I do have a concern of a sort that might not have crossed your mind, but I've actually seen this happen. In some cases there's a preferred candidate who the people who run the riding association board of directors want to win.
Let me take my own riding—not at the federal level, but provincially—as an example. In 2007 the son of the riding association president ran for the nomination but did not win the nomination. It was won by a man named Randy Hillier, who is now the provincial member for that riding. The association then refused to make available its funds to their candidate, presumably in the hopes that he would lose, so that the son, Jay Brennan, would get a second shot at it.
Eventually that was overcome, but in the interim, when it looked as if he was going to go into an election without the ability to have any of the funds, even though they could have largely funded the election, I began to work on trying to line up loans to tide him over.
That would actually be impossible, am I right? Am I right that you'd have to have the consent of the EDA, giving them a complete stranglehold over his ability to finance anything?
12:20 p.m.
Former Chief Electoral Officer, As an Individual
No, not at all. The EDA could set a limit or the guarantee. If it provides a guarantee, in my view it would be entitled to say they'll guarantee up to a certain amount only, but if the candidate's campaign can go on its own without reference to the EDA—
12:20 p.m.
Conservative
12:20 p.m.
Former Chief Electoral Officer, As an Individual
In terms of loans, then one would have to think.... If one wants the EDA to wind up responsible, because this is essential to the scheme, then the EDA, at a moment in time, may well be involved in setting the limit. When there's a conflict between the two, as you described.... I haven't thought about that particular issue.
12:20 p.m.
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
Okay. I appreciate that. It's a wrinkle that might not occur naturally to one. I don't think it happens that often, but it does occur.
Do I have a moment longer, or are we out of time?
12:20 p.m.
Conservative
12:20 p.m.
Former Chief Electoral Officer, As an Individual
By the way, the party could still provide that guarantee. The EDA may not wish to do it, but the party could still provide that guarantee, and that would work under what I've said.
12:20 p.m.
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
Yes, that would be very helpful. I think that would overcome this kind of local problem that can arise.
Just to state the obvious, the rational purpose of both EDAs and parties is to get the person who won the nomination process elected. That should be what they do.
I raised a problem at the last meeting. You've mentioned some of this, but I would like your thoughts on this problem. In any given riding, you have some parties that are virtually guaranteed to get more than 10% of the vote and others that might or might not. Of course, politics is an unpredictable business, and there are members present in this very committee who did not expect to get more than 10% and wound up becoming the sitting member. That happened without the intervention of funds, but it could be that funds play a role in launching a winnable campaign.
Whenever one makes a commercial loan, one has to take into account the risks involved. It would be hard for an institution, especially one that is actually required to use commercial rates and to demonstrate that commercial rates were applied, not to wind up applying criteria that would cause them to loan to different candidates at different rates. I think that after the fact this would be perceived by many people, despite all the goodwill the institutions are presumably having, as representing some kind of preference one way or the other, so much so that if I were in a situation of running a financial institution, I would give instructions not to loan to anybody because I would not want to face the consequences after the fact of the appearance, invalid though it may be, of preference in the political system.
Do you have any thoughts on that?
12:20 p.m.
Former Chief Electoral Officer, As an Individual
Well, if I were a financial institution, I would still want to loan money, but I would say that we try to loan at the same rate to everybody so that we don't get into this political discussion about favouritism.
That's what I would do, but I don't run a financial institution.
12:20 p.m.
Conservative
Scott Reid Conservative Lanark—Frontenac—Lennox and Addington, ON
Nor do I, so we're both out of our area of expertise.
Thank you very much. You're thoughtful, as always.
12:20 p.m.
Liberal
Kevin Lamoureux Liberal Winnipeg North, MB
Thank you.
I would like to pursue your idea, Mr. Kingsley. You talk about how the current system may have some problems, and what you're suggesting, I think, does have a great deal of merit. I'm just not perfectly clear on it.
Candidates, in essence, in any given election would turn to a riding association, and the riding association could be the major source of money, because you get that loan guarantee. Under your scheme, in the long term how would that affect raising the money and the obligations that the candidate might have himself, or herself?
12:25 p.m.
Former Chief Electoral Officer, As an Individual
Obviously, if the EDA is providing a guarantee, there will be a form of pressure applied on the candidate to pick up the money and get the contributions in accordance with the maximum amount that can be contributed. This is the essence of the game, and how I would view it. There would be that aspect.
If that failed—if the candidate could not raise the money within three years—then the EDA is on the hook. If the EDA cannot pay, then the party is on the hook, so that we escape the perception of undue influence that can be exercised.
I should have indicated that when I ran the conflict of interest regime for the cabinet for Mr. Mulroney, loans were the bugbear. They were one of the toughest issues to come to grips with. People don't consider loans to create a conflict of interest. It's something detestable, something you don't like, and you'll say that you want to get rid of this, yet in the public's mind, it does create a problem.
As a result, we are trying to get away from that, and therefore there will be pressure of some kind. The EDA will want to go out and help raise the money as well, after the event, because it won't want to pay. That's why I said it would introduce an element of greater reasonableness about the loans and beyond the bank's or financial institution's view on the capacity to be repaid. By putting in another judgment, somebody else is going to have to pick it up, making sure that the guarantor is not someone with whom we can be in a conflict of interest or create a conflict of interest or have the appearance of favouritism. Then we've instituted a system of countervailing forces, which would eliminate the problem you're trying to eliminate.
12:25 p.m.
Liberal
Kevin Lamoureux Liberal Winnipeg North, MB
Collectively, among the ridings out there and the ETAs, at the end of the day it's the party that would ultimately be responsible, correct? That could potentially run into hundreds of thousands of dollars, quite easily. Have you shared the idea with parties, or has it been discussed among parties?
I was quite involved in Elections Manitoba. They had an advisory committee and representatives from different political parties. Is Elections Canada aware of the idea you're talking about? To what degree has there been dialogue so that it might potentially come in the form of a more tangible recommendation from Elections Canada?
12:25 p.m.
Former Chief Electoral Officer, As an Individual
There has been no exchange between me and Elections Canada on this. I was invited as an individual who used to hold the office, but I would be willing to sit down with Elections Canada and share this further and see what can be developed.
Obviously, since I did not share it with them, I did not discuss this with political parties either, and it may well be worthwhile pursuing that approach. I thought I would come here and tell you what I thought, after having thought on the problem.
When I used to run the system, there was an obligation of a certain reserve. There still is, but the reserve is less, and so I'm telling you what I think.
12:25 p.m.
Liberal
Kevin Lamoureux Liberal Winnipeg North, MB
Would you apply the same principle, then, to leadership campaigns?
12:25 p.m.
Former Chief Electoral Officer, As an Individual
Yes, and this is what I've indicated as the second thrust of what I was proposing to you as a suggestion. On leadership campaigns, the parties already, if they wish, set a limit on how much can be spent by the contestants.
12:25 p.m.
Former Chief Electoral Officer, As an Individual
It can easily set the limit on what it will allow candidates to borrow, knowing that if the candidate doesn't own up to that debt, they will be on the hook. It will force the parties to be quite rational about what amounts should be spent and what amounts could be borrowed by different candidates. It will force them to reconsider the entry points, the criteria, by which we allow candidates to become contestants for leadership.
Right now money seems to be an important factor. Maybe there should be other considerations. Maybe it should be your ability to go out and get 1,000 or 10,000 people to sign a petition, depending upon which party it is.
Obviously there would be repercussions to this scheme. Obviously you're right in wanting to have further discussion with the various intervenors.
12:25 p.m.
Conservative
