Mr. Speaker, I should begin my comments on Bill C-54 by recognizing and paying tribute to the former leader of the New Democratic Party who most recently sat in the riding of Ottawa Centre, because it was he who blew the whistle on the fact that the political donation regime in this country left a loophole that was so outrageous it was bound to be exploited and abused.
Mr. Broadbent had the sense to recognize that even though the amounts of money that can be donated to a political campaign or to a political party had been reduced, by allowing these huge loans, which never really have to be paid back, it was obvious that somebody with a lack of ethical standards would take advantage of that loophole and would begin to act as if there were no financial limitations. I recognize Mr. Broadbent for raising this issue for us in his ethics package.
I am gratified that today we are dealing with a bill in the House of Commons that will close this last remaining loophole, one of the most serious loopholes in our election financing laws, because we start with the basic premise that nobody should be able to buy an election in this country, or a politician, for that matter. When we are dealing with such massive amounts of money, the point that was made by the House leader of the government was that a politician or a political party is going to owe somebody a great deal. They are going to owe somebody an obligation, a debt, and it is not healthy for the interests of democracy to have some corporate sponsor pulling the strings of politicians through this enormous debt of gratitude that is owed. That is the fundamental principle here. That is the direction in which we believed we needed to go.
These loans were a loophole that simply had to be plugged. The most egregious example, I suppose, and what really caught the public's imagination, was during the Liberal leadership campaign. Even though businesses and unions were not allowed to donate a single dollar, they could loan tens of thousands of dollars or hundreds of thousands of dollars, and individuals could loan far in excess of what they were allowed to donate.
Then, through the very loosey-goosey standards and rules that exist in terms of the repayment of those loans, if the loan was not paid back within 18 months it was deemed to be a donation, albeit an illegal donation. We allowed this contradiction to exist in our election finance regime. Some would say it was by design that the rules put in place by the previous government to put limits on election financing left this convenient loophole there, with it knowing full well their people would stumble upon it, seize on it and use it.
The other example that turned people's heads and simply sounded the alarm that this had to be addressed was the member for Mississauga—Streetsville. Even though a business is not allowed to donate anything and a union is not allowed to donate anything, his business loaned the Mississauga--Streetsville riding association $176,000 in one loan, I believe it was, and another $60,000 in another loan.
How can that be? It is a contradiction that we have allowed to evolve, because if that loan is not paid back within the 18 months, it is deemed to be a donation, and then we will have allowed a business to make a donation, which it is not allowed to at all, and a donation in the amount of a quarter of a million dollars, which is clearly in excess of anything contemplated when we set the donation limits for individuals at $1,100 per year.
This had to be done. I do take some recognition of the fact that we played a role in bringing this about. It was the NDP that moved this as an amendment during the Federal Accountability Act debates, but I also caution that we perhaps have not gone as far as we could. There are two things in the bill that worry me somewhat.
Even though we cannot pass legislation retroactively to give us some satisfaction on the debacle of the Liberal leadership loans or the loan of the member for Mississauga—Streetsville, we can have legislation that is retrospective in nature. We can look at ways to address these loans that drew the public's attention to this issue to make sure there is some compliance with at least the existing regime.
The second thing that we find fault with regarding this legislation is we cannot understand for the life of us why the date of implementation will be six months after the bill receives royal assent. My colleague, the government House leader, suggested that perhaps there is a way we could speak to the Chief Electoral Officer and garner support for the idea of a more rapid implementation date. I would urge the government to do so, because as the bill is currently drafted, it is possible we could have another federal election under the current set of rules which allow these political loans.
Now that it is common knowledge that there is no law against lending someone $100,000, even though the donation limit is only $1,100, a lot more people will be doing it if it is allowed. It would be morally and ethically wrong to allow another federal election to take place under the current set of rules. Therefore, I would urge members when the bill gets to committee, to look favourably on the idea of an amendment, which we would be happy to put forward, that the date of implementation should be when the bill receives royal assent.
This is much in the same spirit that we looked at the Federal Accountability Act. We did not see any reason to delay the implementation of the election financing rules associated with the accountability act, even though the Liberal Party urged us strenuously to delay and delay and delay because the Liberals wanted to get their leadership convention out of the way. That is certainly one of the things we would like to see.
I heard my colleague from the Liberal Party try to make arguments against this bill. Even though I do not take this remark seriously, I do give him credit for at least having the courage to try to be creative to find some reason why this bill is a bad idea.
I do have to counter one of the arguments he made which was completely spurious. He suggested that by banning these loans or putting severe limits on these loans, it would actually act as a barrier to those who do not have access to friends with money from entering into politics. It is like arguing night is day, because that is absolutely 180 degrees the polar opposite of what any cursory reading of the bill would tell us. In actual fact, the idea is to take big money out of politics and to take away the unfair competitive advantage that people who are well connected currently enjoy. The idea is to level the playing field.
That was the purpose of Bill C-24, which the Liberals introduced when they first put limits on donations. The idea was to get big money out of politics so that nobody could buy influence. That was certainly the argument put forward under Bill C-2 when we further reduced the donation limits to $1,100.
It is courageous to argue that this is actually the inverse. It takes a lot of guts to stand there and try to make that argument, but we cannot let that go unchallenged. If anything, this is an enabling measure that does level the playing field so that all of us, if we need to borrow money to get our campaign started, have to go to a recognized lending institution. No single person would be able to underwrite or co-sign a loan to an extent greater than the person would be allowed to donate in that year. It is eminently sensible because if there is a default on that loan and the loan becomes deemed to be a donation later on, then the donation would not be in excess of what the person would have been allowed to donate. It seems common sense to me.
A further innovation and protection here is that we do not want the precedent set by Paul Hellyer and the Canadian Action Party to set the tone. In that case, he simply wrote off the $800,000 debt to the Canadian Action Party. We do not want to see John Rae writing off the debt to Bob Rae. We do not want to see Mr. Mamdouh Stephanos writing off the $200,000 debt which was loaned to the leader of the official opposition. That would be fundamentally wrong because then those guys would have made a $200,000 loan which became a donation which they then forgave. Talk about buying influence in a campaign. What about the $100,000 that Marc de la Bruyere loaned to the leader of the official opposition?
We have every reason to believe that the leader of the official opposition will probably pay back those debts because he will have the ability to fundraise within the $1,000 limit and because he is in a fishbowl and everybody is watching what he is going to do with his campaign debts.
What about the losers in that race? For instance, I used the example of John Rae, a senior executive with Power Corporation, being able to simply write off and forgive the $840,000 that he loaned to his brother, Bob, to run in that campaign. That would be a travesty. That would be an absolute abuse of the election financing laws as we know them today.
With this bill, it is deemed that if the loan is not paid back in an acceptable period of time, or the time frame negotiated between the lender, a bank, and the borrower, or 18 months, whichever comes first, it would be the riding association and the political party of the riding association that would have to assume that debt. That would make sense. In fact it would help from an equity point of view for the person borrowing the money, because the person is actually borrowing the money with the guarantor of the political party that the person belongs to. The financial institution would have some comfort. The person would not have to find a financial backer to co-sign that loan; in fact, the person would not be allowed to.
If, as I have done, one needed to borrow $20,000 to get the campaign started, one would need to find 20 guarantors at $1,000 each. No one person could co-sign the loan. That is the way it should be. If the person cannot find 20 people to sponsor his or her entry into politics, perhaps that person should rethink whether he or she should be going into politics or not because the person is not going to get very far anyway.
I think this is eminently fair. It has covered the three conditions that the NDP raised during the debate on the Federal Accountability Act. I completely reject the Liberals' argument that there could be perverse consequences which would limit entry into politics.
Again my colleague from Vancouver Quadra very cleverly planted the idea that perhaps Equal Voice would be disappointed with this initiative, as if this would somehow be a barrier for more women to enter politics. I would argue that the absolute inverse would be true, because this will level the playing field so that well-connected people with corporate sponsorship, like we saw in the Liberal leadership race, will not have a competitive advantage over a woman without those connections. Again it levels the playing field. We have not had any indication how Equal Voice would react to this bill, but from what I know of the people in that organization, I think they would support this idea.
I wish we would not reform the election financing regime in such a piecemeal fashion. There are a number of other things that the NDP has been calling for. One I will speak to briefly is that now that Bill C-16 has passed very quietly and without fanfare over in the other place, it is now law and we have fixed election dates, I believe we should have year-round spending limits. Now that we know elections will be held every four years on a fixed date in the month of October, there should be some regulation on the amount parties can spend on advertising not just during the writ period but outside the writ period as well. That is a necessary natural consequence of having fixed election dates. I would look forward to some movement from the government in that regard.
I also wish we had done something about the age of political donors. I am very critical of the idea that we can actually launder money through our children's bank accounts in a way to exceed the donation limits allowed by law. That seems to be acceptable in that when it happened in the Liberal leadership race and we filed complaints with the elections commissioner, nothing came of it.
I guess if an 11 year old wants to donate $5,000 to a political candidate, nobody thinks twice. When it is twins and they both decide to donate $5,400 each to the same candidate, nobody thinks twice. Throughout the whole country Canadians shook their heads when they saw that. I would like to see us have the courage to move forward and say that this is simply wrong.
It is wrong to launder money through anybody's bank account if the purpose is to defraud the system and exceed the donation limits allowed by law, whether it is one's mother-in-law or brother. A person is not allowed to donate the maximum himself or herself and then sneak a cheque under the table to his or her buddy and say, “Send this along to the Liberal Party for me too”. It is against the law to conspire to defraud the system. We are silent on that and even when we file complaints on that, the elections commissioner seems to be silent on it.
The NDP tried to move an amendment to Bill C-2 which said that underage people could donate money, but if they did, it would be deducted from the total amount their legal guardian was allowed to donate. In other words, if a 14 year old felt strongly enough about politics and wanted to donate $100 of the money he or she earned at the burger joint, more power to him or her, but that meant the child's parents or legal guardians would donate $100 less that year. If people get a tax advantage from being children's legal guardians, they have to be legal guardians in this era of politics unless and until the children reach legal age as well. That would have been a courageous move and would have cleaned up one of those embarrassing situations that we allow in our system currently.
Let me speak briefly about the outstanding issue that we are all worried about, which is the issue of the member for Mississauga—Streetsville, who is not a Liberal any more, but when the loans took place he was. Now he is a Tory.
I do not know how we are going to address this, but we should remind everybody, and maybe through this speech we will serve notice, that no one's sweetheart can bail out somebody like that. If someone borrows $50,000, as many of the people did in the Liberal leadership campaign, and it is not paid back quickly, the candidate cannot pay it off because he or she would be exceeding the limit. The candidate cannot have a guardian angel donor show up out of nowhere and bail him or her out. The money has to be paid back within the donation limits.
The money was raised within the donation limits of the act, which is $1,100 per year. I do not see how some of these candidates are going to do so. The burden of proof is on them to pay it back in compliance with the law. Some of these failed leadership candidates are now raising money for the next federal election and they are still asking people for money to pay off the debt they incurred.
As I say, it is not that tough for the winner to pay off the debt. It is a lot tougher for the losers, the ones who did not win. It has to be the $1,000 limit. We are watching. These people are in a fishbowl and we will be filing complaints. If they do not pay it back at all and it is deemed to be a donation, then what? I will tell the House what.
Under the current election laws, and this should be fixed too, they can take out another loan to pay off the first loan and buy themselves another 18 months. Then the debt gets lost in the sands of time and we will have been complicit with somebody conspiring to defraud the election system. Those are the people on this list that I have right here.
Some of the people in the Liberal leadership campaign might find themselves in that situation. It would be wrong, but they may be leaning that way and our Elections Act is not tough enough to stop that from happening. I was disappointed, in fact I was shocked to learn that would be allowed, that they could take out a second loan to pay off the first loan and buy themselves another 18 months. Who is going to be around to police whether the second loan gets paid off three or five years down the road? This is really not satisfactory.
If we are serious about levelling the playing field, about taking big money out of politics and about making sure that nobody can buy an election in this country, we have to go all the way. We should put together an election financing regime that we can all be proud of. We could be an international centre of excellence. That would make me proud.
I take some pride, as I said at the beginning of my remarks, that it was the former leader of our party, the hon. Ed Broadbent, who brought this issue to light and said, more or less, that no further federal elections should take place until we clean up the election financing regime in this country. The NDP tried to do it during the debate on the Federal Accountability Act. It seemed to take a little longer than we thought to resonate with the ruling party, but it seemed to have at least accepted the need for this now.
We are critical that there will be a six month wait after the bill receives royal assent. We expect this to get a rough ride from the Liberal Party. I am not trying to state the obvious, but if one cannot raise or borrow money, one is not going to be in any hurry to pass this bill.
We hope the Liberals do not stall it unnecessarily, but I think the government should act quickly to take that six month proviso out of the way, implement it as soon as we can, and get it through the House, so that the next federal election can be run with equal opportunity for everybody and that no unfair competitive advantage go to those who might enjoy a corporate sponsor or guardian angel donor.
