Madam Speaker, it is my pleasure to rise with respect to this debate and make further comments on something that was raised during the debate on the subject of trust funds.
It was said that the government had not dealt with trust funds. I beg to differ. I will elaborate with respect to the overview, which I think will bring members of the opposition to the proper conclusion that the matter of trust funds has in fact been dealt with.
There has been a lot of confusion with respect to Bill C-24 and the use of trust funds for political purposes. I believe it is time to correct these misconceptions and to try to set the record straight. In this regard, it is important to be clear about what Bill C-24 will do and what it will not do with respect to trust funds.
Three types of trust fund activity must be clearly distinguished: improper use of trust funds that is caught by Bill C-24; improper use of trust funds that is not caught by Bill C-24 but is dealt with by other means beyond the context of the bill; and finally, the use of trust funds that is not improper and is therefore not caught at all.
By way of overview, first and foremost, Bill C-24 contains a number of safeguards which would ensure that political trust funds cannot be used for election purposes which in fact would evade prohibitions or limits on political donations or deliberately avoid disclosure requirements. The proposed legislation would ban indirect political contributions and provide for a system of full disclosure to ensure that hidden donations are not possible.
Bill C-24 does not, however, and I emphasize this, attempt to address every type of wrongdoing or improper conduct involving political trust funds. It is about political financing specifically in the context of elections. Where trust funds are used for non-election purposes, for example to confer a personal or private benefit, other mechanisms in fact apply. Most specifically, these include the proposed code of conduct for parliamentarians, to be administered by an independent ethics commissioner.
There are also potential uses of trust funds that are not improper and need not be prohibited at all. For example, like other citizens, politicians may wish to involve themselves with charitable work or non-profit causes that have no electoral purpose. This is entirely legitimate, and most members would accept that we are attempting to encourage community based organizations to participate in improving the quality of life in our communities. This is entirely legitimate. In no way could it be suggested that it undermines democratic principles generally or circumvents the electoral finance system in particular. So the fact that trust fund activity can be used for non-electoral purposes is not caught up by Bill C-24 and cannot be regarded as a loophole.
I will discuss the use of trust funds that are caught up by Bill C-24. Later, a colleague will discuss the use of trust funds that are not caught up by Bill C-24 but are caught up by other means, as I illustrated a little earlier.
Let us talk about the use of trust funds for electoral purposes that are caught up and included within the context of Bill C-24. While Bill C-24 does not address trust funds directly, the effect of its provisions would be to prevent the use of trust funds as a way to funnel money to political candidates and parties, thereby deliberately circumventing contribution limits and the disclosure requirements. Bill C-24 provides that any money donated to a candidate, a riding association, a political party, a nomination contestant or a leadership candidate can only come from an individual out of his or her own money.
This is subject to two very limited exceptions for donations from corporations and trade unions and from unincorporated associations made only at the local level and up to a maximum of $1,000 per year. Not being an individual, trust funds cannot contribute in their own right. But what about indirect contributions from the fund through its trustee or trustees?
Where the trustee of the fund is a single individual, no contributions would be possible. This is because Bill C-24 expressly prohibits indirect contributions received from another person or another entity. Thus an individual trustee, like any other individual, could only donate his or her own funds and not funds received indirectly from others.
There may be circumstances however, such as where the trust fund is administered by more than one trustee, where a trust may be treated as an association. Bill C-24 provides a minor exception to the prohibition on indirect contributions by allowing associations of individuals to contribute funds received from other individuals. The names and addresses of original contributors must be disclosed, along with the amount of their contribution.
This is the only way a trust fund could contribute money for electoral purposes. It is not in any way a loophole in the system or an oversight in the bill, but a carefully limited exception. It directly parallels the exception allowing minor contributions from unions and from corporations. Moreover, as I indicated before, contributions are subject to full disclosure of original donors.
This exception in no way undermines the system of contribution limits, since any donations made by an individual to such a trust fund must be deducted from his or her overall contribution limit.
Subject to this very limited exception, the provisions of Bill C-24 would, for example, prevent the use of a trust fund to finance a nomination contest or electoral campaign, or to facilitate the transfer of funds collected by one candidate indirectly to other candidates. Trust fund donations to a political party or leadership contestant would be prohibited altogether, since contributions from unincorporated associations would be confined only to the local level.
In addition to these provisions, the anti-avoidance clause of Bill C-24 is also relevant to the use of trust funds. This section prohibits any attempt to circumvent the bill's contribution limits to conceal the identity of a source or of a donation, or to collude with any person for these purposes. This represents a further protection against the nefarious or unscrupulous use of those trust funds for electoral purposes which in fact would subvert the spirit and scheme of the act.
The Chief Electoral Officer has recognized the extent to which Bill C-24 would solve the problem of unregulated election money being channeled through trust funds. As he stated at a recent international symposium “If Bill C-24 is enacted, the Canada Elections Act will do much to eliminate the perception of, or potential for, undue influence from political contributions”--and I emphasize--“including contributions made from trust funds”.
For these reasons I will vote against Motion No. 12, but of course I will support Motion No. 11.
That deals quite comprehensively with the issue of trust funds as it relates to those that fall within the context of Bill C-24 and the use of those trust funds for electoral purposes which are caught by Bill C-24.