Libs need fundraising reform

Appearing in the Hill Times.

In the face of dramatically declining financial contributions and in a new era of political financing, the once reigning Liberal Party needs a bold new grassroots strategy and a clearer, more compelling message to raise money, say Liberal MPs.

Political party financing returns for the first quarter of 2006, released by Elections Canada at the start of the month, show the governing Conservative Party continues to benefit from the new fundraising rules that came into force in 2004. The party received $5.6-million from 37,000 contributors in the first quarter of 2006, $4.2-million more than the Liberal Party's earnings of $1.3-million, which came from only 6,493 contributors.

Under the current financing laws, introduced by former prime minister Jean Chrétien before he left office in 2003, corporate and union donations are limited to $1,000 and individuals can contribute up to $5,000. The measures are said to democratize fundraising and limit corporate influence through political contributions.

The Liberals saw a dramatic drop in fundraising after the introduction of the new rules. In 2003, before the current law came into force, the Liberals attracted $24-million in contributions, but in 2004, under the new rules, the party raked in just $5.2-million, according to Elections Canada financial data.

But the Conservative government, under the Federal Accountability Act, which is now being studied at the Commons Bill C-2 Legislative Committee, proposes to outright ban all corporate, union and organization donations. The bill will only allow up to $1,000 contributions annually for individuals.

Liberal MP Stephen Owen (Vancouver-Quadra, BC), who is on the legislative committee studying the Federal Accountability Act, said he supports the new limits on campaign contributions because they will reduce public cynicism surrounding corporate influence in politics, but he acknowledged that the Liberal Party will have to look at developing more grassroots support from a base of permanent party members.

"I think that's always been the intention, but I think perhaps more emphasis now will have to go in that direction, even though it's an area that wasn't neglected before," Mr. Owen said. "When that becomes more and more the major source of electoral financing, then we're going to have to. That's the name of the game, certainly now. Get as broad a signed-up, permanent membership as you can, donating on an annual basis, especially in a minority government, you never know when you're going to need it."

Mr. Owen added, however, that he thinks the Liberals will have to go through a period of adjustment before making significant gains in the new era of political fundraising. "I think for all parties it will take an adjustment in how funds are raised," Mr. Owen said. "In my own constituency we've never had difficulty raising funds, but it's been from small fundraising activities and dinners and small donations from lots of people."

The new rules proposed in Bill C-2 appear to spell more trouble for the Liberal Party, which continues to suffer from the limits on corporate donations and lagging party support nationally. In the first quarter of 2006, according to the data released this month, the Liberals earned about only $183,000 more than the federal NDP, which received $1.1 million from 12,850 contributors.

A poll released last week by Decima Research for The Canadian Press also suggested the Conservatives are at 41 per cent nationally and the Liberals at 29 per cent. The NDP had 16 per cent support nationally, according to the poll, the Bloc Québécois nine per cent and the Green Party seven. The poll, conducted May 4 to 7, surveyed 1,008 people and is considered accurate within plus or minus 3.1 per cent, 19 times in 20.

"Clearly the party needs to reform its fundraising, to a more broad-based, a more grassroots approach," Liberal leadership candidate Scott Brison (Kings-Hants, NS) told The Hill Times last week on his way into Question Period on the Hill. He suggested that the Liberal Party leadership campaign, now under way and scheduled to select a new leader at a convention in December in Montreal, will help renew grassroots support for the party as new policy ideas are discussed and absorbed by the public.

"I think national permanent membership will help significantly, and I think that money follows message. With clearer messages that affect people it will be more compelling for them to support us," Mr. Brison said. "As we have a clearer message, and as we present our ideas, individual Canadians, I believe, will see merit in supporting them [candidates] both personally and financially."

Conservative MP Jason Kenney (Calgary Southeast, Alta.), the Parliamentary Secretary to Prime Minister Stephen Harper (Calgary Southwest, Alta.), said the Liberal party is going to face further fundraising troubles with the new limits proposed in Bill C-2.

"They've got a great challenge because they're not a grassroots party. It's a party of powerful elites, corporate donors and

Bay Street lawyers and lobbyists who have propped them up financially," Mr. Kenney said. "Now, with the elimination of corporate donations and reducing individual donations from $5,000 to $1,000, they'll have a hard time making ends meet."

When asked to give the Liberals advice on a grassroots strategy, Mr. Kenney smiled and said: "You have to find issues that have a broad-based, popular appeal. I'm not going to give them our secrets. Maybe they should read our platform."

As a result of the 2004 political financing legislation, the government subsidizes parties after each election with $1.75 per vote received, and large donations must be disclosed. Liberal MP Derek Lee (Scarborough-Rouge River, Ont.) questions the proposed limits in Bill C-2, saying they are likely to shut out some areas of support, and said he wonders how much administration and enforcement will cost with so many limits and reporting requirements for political donations.

"While I see the good public purpose envisaged by that, it's going to mean that parties are certainly going to have to restructure, and it is notable that large portions of public money now go to political parties," Mr. Lee said. "The next question will probably be, now that no institutional donations are going to be accepted--if the bill is passed--what proportion of political party expenses are going to be borne by the tax payer and what proportion by the individual donors? This is something that we haven't had to deal with directly before."

Mr. Lee also noted that the NDP used to benefit from large union donations, but Judy Wasylycia-Leis (Winnipeg North, Man.), said the party is adapting. "I don't think anything's changed for us," Ms. Wasylycia-Leis said. "It's always hard to build, to maintain a mass-based party, but that's what we aim to do."

Although Ms. Wasylycia-Leis said it will be fairly easy for even individual donors to reach the proposed $1,000 limit, she said she supports the measures. She added that the NDP found fundraising easier in the last election and has found successful fundraising in her riding through teas, garage sales and other grassroots events.

"I think it's important," Ms. Wasylycia-Leis said. "We want to get away from big money in politics to ensure that ordinary citizens have a way to support and participate, financially as well as through direct participation."