HAFF Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Procedure and House Affairs

EVIDENCE

CONTENTS

Thursday, May 15, 2003

Á

1110

The Vice-Chair (Mrs. Carolyn Parrish (Mississauga Centre, Lib.))

Hon. Don Boudria (Minister of State and Leader of the Government in the House of Commons)

Á

1115

Á

1120

Á

1125

Á

1130

Á

1135

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

Á

1140

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian Alliance)

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. John Reynolds

Hon. Don Boudria

Mr. John Reynolds

Hon. Don Boudria

Mr. John Reynolds

Hon. Don Boudria

Mr. John Reynolds

Á

1145

Hon. Don Boudria

Mr. John Reynolds

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Joe Jordan (Leeds—Grenville, Lib.)

Hon. Don Boudria

Mr. Joe Jordan

Hon. Don Boudria

Mr. Joe Jordan

Hon. Don Boudria

Á

1150

Mr. John O'Reilly (Haliburton—Victoria—Brock, Lib.)

Mr. Joe Jordan

Hon. Don Boudria

Mr. Joe Jordan

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Michel Gauthier (Roberval, BQ)

Á

1155

Hon. Don Boudria

Mr. Michel Gauthier

Hon. Don Boudria

Mr. Michel Gauthier

Hon. Don Boudria

Mr. Michel Gauthier

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

Â

1200

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Jacques Saada (Brossard—La Prairie, Lib.)

Hon. Don Boudria

Â

1205

Mr. Jacques Saada

Hon. Don Boudria

Mr. Jacques Saada

Hon. Don Boudria

Mr. Jacques Saada

Hon. Don Boudria

Mr. Jacques Saada

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Jacques Saada

Hon. Don Boudria

Mr. Jacques Saada

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Dick Proctor (Palliser, NDP)

Hon. Don Boudria

Mr. Dick Proctor

Â

1210

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Rodger Cuzner (Bras d'Or—Cape Breton, Lib.)

Â

1215

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Rick Borotsik (Brandon—Souris, PC)

Hon. Don Boudria

Mr. Rick Borotsik

Hon. Don Boudria

Mr. Rick Borotsik

Hon. Don Boudria

Mr. Rick Borotsik

Hon. Don Boudria

Mr. Rick Borotsik

Â

1220

Hon. Don Boudria

Mr. Rick Borotsik

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Rick Borotsik

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Rick Borotsik

Hon. Don Boudria

Mr. Rick Borotsik

Hon. Don Boudria

Mr. Rick Borotsik

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

Mr. Rick Borotsik

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Geoff Regan (Halifax West, Lib.)

Hon. Don Boudria

Â

1225

Mr. Geoff Regan

Hon. Don Boudria

Mr. Geoff Regan

Hon. Don Boudria

Ms. Michèle René de Cotret (Senior Privy Council Officer/Counsel, Legislation and House Planning/Counsel, Privy Council Office)

Mr. Geoff Regan

Ms. Michèle René de Cotret

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. John Reynolds

Â

1230

Hon. Don Boudria

Mr. John Reynolds

Hon. Don Boudria

Mr. John Reynolds

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Ms. Marlene Catterall (Ottawa West—Nepean, Lib.)

Hon. Don Boudria

Â

1235

Ms. Marlene Catterall

Hon. Don Boudria

Ms. Marlene Catterall

Hon. Don Boudria

Ms. Marlene Catterall

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Michel Guimond (Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ)

Hon. Don Boudria

Â

1240

Mr. Michel Guimond

Hon. Don Boudria

Mr. Michel Guimond

Hon. Don Boudria

Mr. Michel Guimond

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Â

1245

Mr. Joe Jordan

Hon. Don Boudria

Mr. Joe Jordan

Hon. Don Boudria

Mr. Joe Jordan

Hon. Don Boudria

Ms. Michèle René de Cotret

The Vice-Chair (Mrs. Carolyn Parrish)

Â

1250

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Mr. Dick Proctor

Â

1255

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

Hon. Don Boudria

Mr. Dick Proctor

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Ms. Marlene Catterall

·

1300

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Ms. Marlene Catterall

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

Hon. Don Boudria

The Vice-Chair (Mrs. Carolyn Parrish)

---

CANADA

Standing Committee on Procedure and House Affairs

---

NUMBER 043

l

2nd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Thursday, May 15, 2003

[Recorded by Electronic Apparatus]

Á  (1110)  

[English]

    The Vice-Chair (Mrs. Carolyn Parrish (Mississauga Centre, Lib.)): I'd like to call the meeting to order please.

    I'd like to welcome Minister Boudria. It's a very real pleasure to have you here this morning. We're waiting with bated breath to hear what you have to say.

    Hon. Don Boudria (Minister of State and Leader of the Government in the House of Commons): Thank you.

[Translation]

    Madam Chair, with me are Ms. Kathy O'Hara, Deputy Secretary to the Cabinet and Michèle René de Cotret, the technical expert for Privy Council on this bill. If you do not mind, they will help me answer the questions from our colleagues.

    Madam Chair, I am happy to have this opportunity to appear before you for a second time concerning Bill C-24. I have been following the work of this committee with much interest and I was quite impressed by the level of representativity of these witnesses the committee chose to hear. The hearings have allowed a broad range political parties, interest groups and individuals to express their views.

    As was the case during the debate on second reading in the House of Commons, I believe that, in general, the tone of these hearings was very positive. In my opinion, the majority of witnesses are agreed on the broad objectives and key principles of Bill C-24.

    I would like to spend part of my time today dealing with certain interesting proposals that came up and suggest a few amendments which, in my opinion, will help make the bill work better.

    As I said during my last appearance, the government is ready to consider amendments proposed by the committee as long as they respect certain principles. These are the principles.

    First, any amendment proposed must respect the principles set out in the bill. For example, we could agree to review the different limits concerning contributions from individuals but a suggestion to impose no limits on individuals or to change substantively the corporate limits would clearly run counter to the spirit of the bill.

    Second, any amendment examined could only bear on matters that can be dealt with within the framework of the bill. There is a very well-established principle according to which we cannot amend the main legislation. We can amend only the bill we have before us. That goes without saying, because that is part of the rules and this committee, which has much expertise in the area, knows this already. In other words, some matters may be related in some way to the present Elections Act, like questions of ethics, for example, but are not dealt with in Bill C-24. The standing orders do not allow that.

    Besides those two principles, the first one to deal with any eventuality and the second one which is a principle applying to the examination of any bill, I believe it is important to keep in mind, during today's discussion and those that will follow, the context in which we are examining this legislative measure.

    As Mr. Kingsley, the Chief Electoral Officer pointed out, the evolution of the legislation on political financing in Canada did not happen overnight. We should thus not expect that Bill C-24 will resolve this matter of political financing forever. This is an evolutionary process. The Quebec legislation, for example, which, I think is a very good model, will doubtless be improved at some point as will this bill at some later date.

    Since we will continue examining the efficacy of legislation on political financing, since the expectations of Canadians will change at some point and since our political system will inevitably evolve, parliamentarians doubtless some day will be called upon once again to look at these matters and improve the body of legislation.

    First, I would like to deal with certain key questions that have been discussed during the hearings and I would also like to submit for your consideration some possible amendments.

[English]

    In the area of disclosure, I believe the testimony the committee has heard has shown very strong support for the extension of disclosure requirements to electoral district associations, leadership contestants, and nomination contestants. In the case of the first two these exist at the provincial level in various jurisdictions already. The only thing new, not basically done elsewhere, concerns nomination contestants and the rules applying to them.

    Interestingly, apart from the supportive commentary, comments on the disclosure provisions have come from essentially two directions. On one hand, a few witnesses have argued that the provisions don't go far enough, that we should have more disclosure, quarterly perhaps, such as they have in the United States and Britain. But we recognize that in the United States it's only a portion of contributions that are disclosed, because the other ones are taken care of in a parallel process that is technically outside the election laws, so that doesn't cover everything either. On the other hand, some representatives have expressed concern that these measures would place too much burden on nomination and leadership contestants and on electoral district associations. As I indicated, as far as leadership contestants and electoral district associations are concerned, various provincial regimes cover them already, it's only one of these elements that's new, and I have some technical improvements to suggest to the committee that might assist in making that process a little better.

    As I noted in my first appearance before your committee, while the disclosure measures will undoubtedly increase demands on associations and leadership and nomination contestants, they are reasonable, and I think they're vital to meeting the bill's objectives. I'm a member of Parliament from Ontario, as you are, Madam Chairman, and in the districts we both represent and everywhere else in that jurisdiction, perhaps elsewhere in Canada too, we have identical boundaries with our provincial associations and an identical geographic area, sometimes with the same members on both executives. In my case many of the people are the same ones organizing for my party at the federal and provincial level. I used to be a provincial member for the exact same riding too, and we had disclosure requirements that were far stricter, and still are, than exist federally. Surely, if the same people can produce the same document for a provincial riding association, they don't become less competent or less able because the association has to do with federal elections. So I believe that's very doable. Furthermore, many of these requirements even exist for municipal elections in this country. So they're not beyond the realm of possibility.

    That being said, though, I've heard arguments of those who have talked of relieving some of the burdens that might be there, and in that regard, I would be prepared to support some amendments, and I offer them, respectfully, to the committee.

    I know members are concerned about the effect of next year's redistribution, something that has been raised both in this committee and, I believe, informally by some people, as with me privately, and whether this imposes too great an administrative burden on electoral district associations. I believe we've found a way in which we can handle that. There have been discussions with Elections Canada and people drafting at Privy Council and Justice, and we would be ready to support an amendment to proposed section 403.22 so that the existing registered electoral district associations can continue their existence in districts with new boundaries upon the dissolution of the old districts by the Electoral Boundaries Readjustment Act. This would be done simply by notifying the Chief Electoral Officer that the former riding of, say, Glengarry--Prescott--Russell is the new riding of Glengarry--Prescott--Russell. Of course, there are a few cases where that won't work, but it could work for many associations, to simplify the process. You wouldn't have to re-register at all, just transfer the previous registration to the new boundary.

    In addition, a preregistration process would allow other associations to preregister. Say in some provinces you create a new riding. You could preregister them after we finish with the Electoral Boundaries Readjustment Act and, obviously, after we finish with this bill, but in the year before it kicks in, so we could be ready for the implementation. I believe the best estimate at this time is July 21, 2003, and then it kicks in one year later. The interval then would be between July 21, 2003, and July 20, 2004, presumably. Re-registration, following the readjustment process, would therefore become a rare exception, not the rule. It'll simplify that. I do thank members for having raised it, though, because that amendment, developed together with Elections Canada, may relieve quite a bit of administrative burden. It would be very useful in a general way, regardless of anything else.

Á  (1115)  

    Some members have indicated their concern about the potential burden of reporting requirements for nomination contestants. The bill currently requires nomination contestants to file a report with Elections Canada if they receive more than $500 in contributions or incur more than $500 in expenses for the contest, or both. I certainly would be willing to support an amendment to bring that amount up to $1,000. I don't believe, if someone spends $750 on a nomination contest, having to file a lot of papers for that is really in the public interest. An amount of less than $1,000 I think most people would think is quite reasonable for not having reporting requirements. As the chair of the committee will know, between that and the next threshold, which is $10,000 in the bill, there is a summary reporting, a statutory declaration by the candidate, and so on. It's only above $10,000 that you need, in the bill, to have an audited statement, in other words, only if it involves large expenditures. That being said, I think there is certainly overwhelming support, certainly from members I spoke to, for having rules about nomination contests with expenditures.

    In addition, as I mentioned in my initial appearance, the government would be willing to revoke the transitional provision in clause 71 of the bill. As a result of not including this provision, electoral district associations would start to disclose the sources of the funds they receive only as of the date the bill comes into force. There was a provision in there that in fact created a form of retroactivity and made it almost impossible for a constituency association, if they had funding in another account--call it a trust fund, call it what you like--to put it as part of their holdings, unless they could reveal all the sources where they got it from the beginning, including having held a bingo 10 years ago, which I would suggest was impossible to administer. Anyway, when the act came into force in 1974, they said, okay, any amount political parties have on this day is deemed to be the amount they start with. So we will do the same with this bill: any amount you have on the first day is the amount you start with.

    In order to make that happen better, I'm convinced that we should move away from the coming-into-force provision that has six months after proclamation or January 1, 2004, whichever is later. I think it would work far better if we had a January 1, 2004, precise date. Then it doesn't matter if they're going on holidays at Christmas, as their riding association accounts could then regroup all the funding they have, because they would know that's when the new rule would kick in. Otherwise, it would be very difficult to do that, I would suspect. There are probably countless other administrative reasons that it's easier to have a hard date anyway, including making everybody eligible to have the higher tax credit as of January 1, rather than later.

Á  (1120)  

    Turning to the limits on contributions from individuals, there was a strong feeling expressed by many witnesses during the hearings that the $10,000 contribution limit is too high. Some members have expressed this view. In view of what seems to be, if I am allowed to call it so, a consensus, I would be prepared to consider an amendment to reduce somewhat that amount, but I would like to get the opinion of the committee on that. I am not looking for unanimity, but for what the general opinion might be.

    I would caution my colleagues, though, even if that is considered, not to do the following. I don't think we should reduce the amount a candidate can contribute to his or her own campaign. Surely, if the threshold of, say, $10,000 or $8,000 is deemed to be the amount beyond which it seen as exercising influence that is too large, that doesn't hold true if you contribute to your own campaign. I would suggest, at the very least, that the amount that's there should stay there if one's contributing to one's own campaign. I will be looking forward to comments from members in that regard.

    I want to address the issue of artificially creating election expenditures in order to obtain candidate or party reimbursement. The Chief Electoral Officer addressed this issue and indicated in his presentation that while this practice is not necessarily illegal under the act, it is against the spirit of the legislation. I would propose an amendment to add an anti-avoidance rule, which would prohibit anyone from entering into a contract or agreement with a party, a candidate, or candidates for the payments of goods or services when a condition of that agreement is that the person, persons, or candidates would make a contribution of a similar amount or of any amount to a political party. In other words, removing the precondition I believe would clear things up, and then these issues would no longer be raised.

    With regard to the prohibition on corporate and union donations and the $1,000 exception at the local level, again we have seen quite a range of testimony. Some witnesses have argued that there should be no limit or a higher limit, others have argued that corporations and unions should be banned outright from contributing, as they are at the provincial level in both Quebec and Manitoba. Removing the prohibition or increasing the limit would, in my view, go against the principle of the bill. At the same time, I do recognize that the $1,000 exception is important to political participants at the local level, the small business owner of the hardware store around the corner who buys a ticket to the annual golf tournament for the candidate for nomination, the constituency association, and so on. It is an issue of importance, and many colleagues have raised it.

    As I mentioned, however, I will be ready to support an amendment that would allow a corporation or a union that has already contributed in a riding in a particular year to make a supplementary contribution of up to $1,000 when a riding has more than one election or byelection. For example, we just had a byelection in Perth—Middlesex. If there were to be another election in December, to use the same calendar year, this would permit the odometer to go back to zero, as it were, for that purpose.

    Something else has been brought to my attention, and this was immensely helpful. I would be prepared to consider a further exception to the $1,000 limit in cases where a corporation or a union has contributed to a losing nomination contestant, a nomination contestant who lost to another contestant of that party, The corporation or union would be able to contribute again to the winning contestant. Surely, having contributed to someone you defeat should not count against the one who did win. A colleague made that argument very forcefully, and it's eminently reasonable that the threshold should be changed. I do hope you discuss that. Of course, I'm referring to the same year, because when you get into a new calendar year, the issue doesn't present itself.

Á  (1125)  

    Finally, some party officials have expressed concern about the proposed authority given to electoral district associations to issue tax receipts. To address this concern, I'd certainly be willing to support an amendment that would make provision of this authority subject to the party leader's agreement, in other words, if the party leader says, no, this particular district association doesn't exist in that area, we're not going to issue a book, attach the receipts for people we never heard of, we're not satisfied that they have that maturity or that they even represent us, or whatever it is, that there should be almost the equivalent of a leader's letter in the case of candidates. By the way, when one of these situations occurs, the party can either centrally issue the tax receipt or, where the party is federated, the provincial-territorial association can do that, if that's part of the way that particular party does business. That would be okay as well.

[Translation]

    As I have said before, I would support an amendment to decrease the limit of expenses allowed to nomination contestants from 50 per cent to 25 per cent—Madam Chair, you yourself lobbied on this matter—of the amount allowed for the candidates at the last election. I don't think it would be realistic to decrease this percentage any further because it applies to the amount of expenses made during the last election. In some constituencies, the amount can be rather low. If we were to decrease the percentage further, the risk is that the limits would be very stringent in some regions. I would add that if the percentage does decrease to 25 per cent, that must not include the personal expenses made of the candidates. I am thinking more specifically about candidates in rural areas. Their travel expenses exceed all their other expenses. So we must exempt from this calculation the candidates personal expenses such as leasing a small plane to visit a neighbouring native community, for example.

    In that respect, proposed clause 478.14 dealing with the limits on expenses for a nomination campaign expenses should be corrected to ensure that it does not apply to the personal expenses of the candidates so that travel expenses will not be included in the limit for nomination campaign expenses. There is a precedent, Madam Chair, because this exemption already exists for candidates in general elections. For example, the members for the Northwest Territories, Nunavut or other huge rural ridings are already entitled to that exemption just as we all are, actually. Travel expenses are not included when setting the limits on our expenses. The travel expenses, travel and so forth of nomination contestants should, in the same way, be exempted when calculating their expenses. The precedent exists.

    I would like to look at the matter of public financing with you. During the hearings, it was clear that this was an important matter for many witnesses. It is interesting to note that, those witnesses who addressed this question did not ask that existing public financing be eliminated. We shouldn't try to claim that the public financing of political parties is something invented with Bill C-24. In fact, since 1974, almost 50 per cent of authorized expenses of election candidates are reimbursed and recognized political parties to get back 22.5 per cent. To my knowledge, the political parties have always kept the money. To date, I haven't been made aware of any case where a cheque was sent back to the Consolidated Revenue Fund. We shouldn't maintain that all the measures provided for in the bill are without precedent. That measure already exists. That measure is improved but isn't something new invented in this bill.

    In fact, a lot of people have pointed out the role that public financing plays as well as the necessity to ensure that public financing of the parties will be on-going to allow them to do the important work they must do between elections. Of course, political parties are essential to our form of parliamentary democracy.

    Moreover ,there have been discussions not concerning the elimination of the public allowance itself, but rather about the different formula that might be used. Should the calculation be based on the number of members of a party? Should the base be the riding associations? Could it be matching subsidies? Could we have income taxes withheld at source, an increase in broadcast time? All kinds of ideas have been explored but this discussion did not lead to any unanimous agreement, to say the least.

    In my opinion, one of the key pieces of testimony in this respect was given by the Quebec chief electoral officer who indisputably has real experience in managing that kind of allowance. The same could be said of New Brunswick and Prince Edward Island. Quebec has a system similar to the one proposed in Bill C-24 and the Quebec chief electoral officer stated that an allowance based on the number of votes garnered is fully accepted in Quebec.

    As I mentioned during my first appearance, I think we should wait a while and see how the proposal actually works before changing it. We may later come to the conclusion that the $1.50 amount should be more like $1.60, $1.62 or $1.46.

Á  (1130)  

    However, I am convinced that granting an amount of $1.50 per vote means that no political party will be disadvantaged through the limits on financing, not only for those parties presently represented in the House of Commons but also those parties that participated in the electoral process the last time around. That amount is based on the number of votes obtained and thus all parties will have available the funds they need to work properly.

    However, I would like to propose an amendment to this clause to respond to the very legitimate concerns raised by the provincial and territorial associations, which are afraid they will not have access to part of the allowance. Some political parties exist only in some areas of our country. That is totally legitimate. Others have a very centralized focus and their headquarters is here, in Ottawa, or elsewhere. Others are federations. All these different models exist and must be recognized. So I am ready to bend on that question. I would accept an amendment requiring the Chief Electoral Officer to pay out a portion of the allowance to provincial and territorial associations, if the leader of the party authorizes it. In other words, this would be a transfer made directly by Elections Canada.

    My political party is federated. We have a headquarters as well as offices in Toronto, Quebec City and so on. We must understand that if we give a certain percentage within a province, it will be within the context of federal elections, not provincial elections, because there is already provincial legislation that must be respected.

    Moreover, the provincial and territorial associations would also retain the authority to issue their own receipts, as is already the case, where the leader of the party authorizes it. That would not change, as a reassurance for all elected members.

    In conclusion, I thank the committee for the great work it has done so far. I am looking forward to on-going close cooperation with the members of the committee to get these amendments passed. These proposed amendments, I think and I hope, will answer many of the concerns while respecting the principles of the bill and ensuring that our important objectives are met.

Á  (1135)  

[English]

    I'd be pleased to take any questions you have, Madam Chair, or any members of the committee.

    Thank you very much.

    The Vice-Chair (Mrs. Carolyn Parrish): I have a lot of questions, but I'm going to give you my batting list first. It's Mr. Reynolds, Mr. Jordan, Mr. Gauthier, Mr. Saada, Mr. Proctor, Mr. Cuzner, Mr. Borotsik

    Hon. Don Boudria: Madam Chair, I'm sorry, I forgot one element. I apologize to members.

    This is last minute, but it concerns candidate's election day expenditures. There are parts of the country where candidates' representatives on election day go to the polls, count the ballots, this and that. In some parts of the country there is a custom--it doesn't exist where I live, but I know it does elsewhere--that these people are paid to do that work. That's fine, except that right now that's considered an expenditure within the allowed limit. It's only been that way for one election; prior to that it didn't count, it was outside the limit, because it can eat up quite an amount of money. Anyway, you're finished campaigning by then. Those people can't campaign, they're inside the poll, and they're are the personal representatives of the candidates. So the proposal I'm making to you, and I do this less formally here, without text, is that these could be deemed to be a candidate's personal expenditures, because they are the personal representatives of the candidates, and you can't campaign inside the poll, that's illegal. So paying them, I would submit, could be considered a candidate's personal expenditure and be outside the limit.

    It's been brought to my attention, and I believe it's a good point. The only question I had is whether this is outside the scope of the bill. I've been reassured that there is a reference in the bill that makes it possible to amend a clause. We'll even have officials work on preparing the amendment if the committee is willing to have that particular proposal. I'm sorry if I'm injecting that at the last minute, but we will provide additional material on this.

Á  (1140)  

    The Vice-Chair (Mrs. Carolyn Parrish): Okay.

    I'm going to try to be really tight with the time, and then we'll do a second round.

    Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian Alliance): Do we have five or six minutes?

    The Vice-Chair (Mrs. Carolyn Parrish): You have five, and I've been allowing people to go to six, but at six I chop your head off.

    Mr. John Reynolds: Thank you.

    I'd like to ask you, if you can tell me, how many donations were made by individuals in the last recorded year between $5,000 and $10,000, probably minus whatever Martin has raised for his leadership race, just to see if there is really an issue with that amount for a very small number of people. I just wonder if you know roughly what that number would be.

    Hon. Don Boudria: We're told it's in the order of 1%.

    Mr. John Reynolds: If we put it down to $5,000, we'd be eliminating 1% of the people who are wealthy in this country who might contribute.

    Hon. Don Boudria: No, that's not what it means. It means that 1% may only give half as much, not that the 1% cannot contribute.

    Mr. John Reynolds: That's right, they'd only give half as much as they can now.

    I've listened to all your amendments. There is certainly a lot of window dressing. My party thinks this bill is as dumb as a bag of hammers and is not necessary in this country right now.

    One of the things we do, and I'm sure other people do, is pass the hat at a public meeting to cover the cost of a room and that sort of thing. With this bill, if anybody wants to give more than $10 in that system, you need to have a receipt there handy for them. I think that is not a good idea. They are putting cash in at a public meeting. I wonder if you would consider raising that amount to $50, to make the accounting process simpler. The money coming in is going to be added up and it's going to come to $500 or $400, whatever the number is at a meeting, and it will be reported by the party, but to start demanding receipts for anything at $10 or more will prevent a lot of public meetings being paid for by people who like to donate money. In at least some parts of my riding it's not unusual to see people put $50 or $100 in the hat when it goes around the room, especially at election time. I'd like to know if you would consider that something we should look at and change in the bill.

    Hon. Don Boudria: The $10 amount is the same one as exists at the provincial level, at least in Ontario. I don't know if it's the same in B.C., though they have strict reporting requirements too in that regard. If there is a consensus on altering that slightly in the committee, I don't think it offends the principle of the bill at all. We must at least remember, though, that each riding association will have its receipt book with it, if somebody gives a donation. You talk about the $1 in the hat here, but if $10 is not the right amount, and it should be $20 or whatever, presumably, if you have one of these meetings, this will become part of the routine. It is part of the routine. I go to provincial meetings in my riding and the receipt book is there on the table. I see it when I go to the meetings of our provincial executive. If anyone gives anything, they give them a receipt. But if that creates an undue burden, perhaps we could alter it slightly, although $50 does seem like a large amount, and I would think that anybody giving $50 would expect a receipt, because they're going to get 75% back on their tax return. It could be altered from $10, but $50 seems kind of high.

    Mr. John Reynolds: You mentioned that you would like to see a candidate personally donate at a higher level than others. I'd like to clarify that.

Á  (1145)  

    Hon. Don Boudria: Not quite. What I did say was that if the committee considered lowering the $10,000 limit to something less, I don't think it would be a good idea in any case to reduce the maximum that a candidate could spend on his or her own campaign. Whatever the threshold is, $10,000, $5,000, $7,000, or $8,000, it is deemed to be the amount beyond which someone could exert undue--or whatever you want to call it--influence on someone else. If it is oneself, surely that doesn't do it. I would say, if you're considering lowering it, there's probably not an objective for lowering it for the candidate himself or herself.

    Mr. John Reynolds: I would disagree with you. I think whatever it is for the average person on the street is what it should be for yourself. Some people might be wealthier than others, and there are ways of getting around it. You can make it up to $10,000. I think it should be the same for everybody.

    The other concern is on nominations. This, to me, is like the old boys or old girls club, whatever you want to call it. For those of us who are here, anybody who wants to seek a nomination against us now has to go and hire an auditor and a lawyer and do certain things if they're going to spend over $10,000 to go for a nomination, and if you're going to defeat a sitting MP, you're certainly going to have spend that kind of money. It seems to me an onerous burden that benefits those of us who are sitting here now, and I'd like to see some changes in that.

    The Vice-Chair (Mrs. Carolyn Parrish): Thank you, Mr. Reynolds.

    Mr. Jordan.

    Hon. Don Boudria: May I respond to that?

    The Vice-Chair (Mrs. Carolyn Parrish): I'm sorry. I thought he was just making a rhetorical comment.

    Hon. Don Boudria: If a sitting MP has to spend a similar amount, he or she will be subject to the same thing. Once in this country, and theoretically it still exists today, some people have needed to spend $100,000 on the nomination, and no one knows what they spent it on. If someone is running in a district where one particular party usually wins, the nomination contest becomes as contested as the election, and arguably almost as important. If it's that important, surely accountability should be part of it.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Jordan.

    Mr. Joe Jordan (Leeds—Grenville, Lib.): Thank you, Madam Chair.

    Don, I appreciate the flexibility you're articulating here today on this bill. It's an extremely complicated piece of legislation, and we must be very concerned about unintended consequences. I just want to clarify one point. The coming-into-force regulations you want to make January 1, as opposed to six months after? Or was that just the one clause? I don't know how you could do that. Could you clarify your position on this?

    Hon. Don Boudria: There is no regulation under this bill. It was said the other night about this bill that the devil's in the regulations. Well, there are no regulations in the Canada Elections Act., there never have been, so far as I know, in the history of this country. With the Elections Act, it should always be the members who decide, so you don't leave an executive function to supersede the decision. That's why there's never been regulation, as far as I know. I don't know if that was the question, but it made me think of it.

    On the coming into force, my proposal is that the entire bill should come into force January 1. It's easier administratively, it would work much better with the riding association transfers. Particularly if we're working on the principle that people will be able to take funds they have and put in the amount by a certain day, we should know the day as soon as possible. I think that works better.

    Mr. Joe Jordan: Okay, that's fine.

    On exempting other donations from people you may have defeated in a nomination, if somebody is defeated in a nomination and has money left over, does that go to the riding association? I come from a family of seven boys, I get my brothers to run against me for a nomination, some company gives them each $1,000. I'm wondering whether we're causing more problems than we're trying to solve with that.

    Hon. Don Boudria: The suggestion was made by colleagues. I don't think so. There is a general anti-avoidance rule in the bill anyway. If you were to create this only to cause expenditures, you would commit an offence by doing that anyway. That's the first thing.

    Mr. Joe Jordan: One of them might beat me, so I'm not apt to try that.

    Hon. Don Boudria: Well, I don't want to get into that.

Á  (1150)  

    Mr. John O'Reilly (Haliburton—Victoria—Brock, Lib.): It wouldn't be hard, they'd only need 50 votes.

    Some hon. members: Oh, oh!

    Mr. Joe Jordan: But your answer is that anti-avoidance is the way to deal with those issues.

    Hon. Don Boudria: In part, but it's not the only thing.

    I'll use that example. Sam Jordan runs against Joe Jordan and is defeated by Joe Jordan. After the thing is over and each party spent $5,000, there is $752 left in the kitty of the defeated candidate Sam Jordan. Whose $752 is it? It's like trying to go back to your bank account and say, I want the $100 I put in two years ago. You're going to get a $100 bill, but who cares whether it's the same one. What would it be that was his, even if you proportioned it, $7.52? I don't believe it's worth arguing about, because any surplus will be transferred to the riding association and could ultimately be used to elect the candidate. But I don't believe that subverts anything in the act anyway.

    Mr. Joe Jordan: To pick up a little on what Mr. Reynolds was saying, on the idea that we're trying to prevent money from influencing public policy, I guess you need to expand your thinking, because money's not the problem. We're trying to prevent people with money influencing public policy. If we go aggressively preventing them giving money, they're just going to shift to non-monetary actions. I just hope we give enough thought to what the landscape looks like then. You may be able to exert more influence through non-monetary actions, or at least as much. If the teachers decide they're going to take over someone's nomination, there are a lot of rural seats in rural Canada where the number of teachers in any community could easily defeat any candidate. This may not win an election, but just the threat of doing that exerts influence over public policy. The United States banned corporate donations over 20 years ago. They may have felt good doing that, but I don't think anyone would argue that they have eliminated influence over public policy. So it's important that we do this properly.

    You've certainly given us a number of additional issues to think about with your presentation here today. I want to thank you for that.

    Hon. Don Boudria: Thank you. Of course, I'm largely responding to issues raised by people to improve the bill.

    I think what we've just heard is an excellent plea for the third-party rules we have pursuant to Bill C-2, but given that I've already asked leave for the Supreme Court to deal with this issue, I don't think I'll elaborate any more, other than to say the third-party rules are important, and the absence of them in the United States has made a mockery of their election rules, because people go around them.

    The Vice-Chair (Mrs. Carolyn Parrish): Thank you, Mr. Minister.

    Mr. Gauthier.

[Translation]

    Mr. Michel Gauthier (Roberval, BQ): Thank you, Madam Chair.

    I would like to tell the minister that, broadly speaking, his comments are interesting as are his proposed amendments and the open-mindedness he has shown in some matters.

    However, I remain concerned by the matter of personal trusts. As the obligation to declare the source of funds in the coffers of riding associations begins the day the legislation comes into effect, it might happen that between now and that date, quite by chance, in a certain number of ridings, there might be massive transfers of funds from personal foundations. This will be illegal under the new legislation. For example, if the friends of Don Boudria were to transfer $58,398 or $75,290 to the Glengarry--Prescott--Russell riding association, the day the new legislation comes into effect, that money would be there and would have been given quite legally. In my opinion, that's one way of getting around the new act and its spirit and it's a betrayal of the spirit of the new legislation. That is my only point of concern. Wouldn't it be preferable to adopt a provision requiring explanations for all sums already in riding association accounts when the legislation comes into effect? Wouldn't that be real evidence of total transparency?

Á  (1155)  

    Hon. Don Boudria: This suggestion poses a problem. This would be a retroactive measure, which means that the people who had made these donations before certain rules were adopted will have to justify what they did according to rules that did not exist at the time they made their donation. Moreover, this retroactivity does not exist anywhere else in electoral legislation. When Quebec passed its legislation, all parties were asked to simply submit a statement of account of the moneys in their possession as of the date the bill came into effect. Ontario did the same thing and the federal government did the same thing in 1974, when it made rules for federal political parties.

    I think that such a measure involves other risks. If we cannot be assured that the moneys outside of the riding associations are deposited into the riding association accounts, what message are we conveying to people? We are encouraging them to leave this money outside of the riding association.

    Mr. Michel Gauthier: If you are asking me the question, I can answer.

    Hon. Don Boudria: O.K.

    Mr. Michel Gauthier: I think that the ideal situation is the only acceptable thing in the spirit of this legislation. If we want to comply fully with the spirit of the law and behave like good citizens, we simply have to declare that a certain number of donations were made and specify the nature of such donations. Right now this debate is taking place during your party's leadership race.

    I know that this approach is being used by the member for LaSalle—Émard in order to keep his funding a secret. Several of your ministerial colleagues think otherwise, particularly the Minister of Finance—and he is important—who is asking that we change this principle. In his opinion, such a principle is not morally valid. Measures demonstrating a clear desire for transparency are essential. If that applies to your leadership race, do you not think that I am right to ask you for it here?

    Hon. Don Boudria: I am not saying that requesting retroactivity is not valid. At the federal level, our political party has funds that go back to the time of Mackenzie King, who left his money in his will. When we passed the current legislation some time in 1974, this money became part of the assets. We considered how much money the party had. I don't recall the exact figure; I think it was somewhere around $1,200,333. So we started from that time on.

    You are suggesting that we ask Michel Gauthier, or someone else whose riding association would have received money in 1994, when no one had to provide a receipt, to go back in 1994 and to state where $200 or $500 amounts came from, for example. Regardless of what the amount is, the principle remains the same. How do we go about deciding when that should start? All that we can do, in my opinion, is to choose a date that the law comes into effect and to require, as of this date, a certified statement from an auditor on the amount of money that a riding association has in its possession and to work from there.

    Mr. Michel Gauthier: I would like to ask another question, which pertains to personal trusts. Since donations were not subject to any particular rules, they could have been made in a context outside of the legislation. Don't you think that the way you are proceeding, which has been rejected by the Minister of Finance, is a way to completely launder these donations even if they were made outside of the Election Act?

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Gauthier, thank you.

    Mr. Boudria, do you want to make a two-sentence comment on that?

[Translation]

    Hon. Don Boudria: Yes, I would like to respond, not to the editorial comments, but at least to the other part.

    Mr. Gauthier said that the funds had been raised outside of the riding associations. That is not necessarily true. To date, nothing obliges a riding association to produce any reports. Some riding associations do so themselves. Every year my riding association produces an audited report. We have been doing this for years because we want to. Our report is public and we submit it to the media at our annual meeting. We are not compelled to do this; nothing in the legislation requires us to do this. The riding associations next to mine have never issued any public documents. Why should they since nothing required them to do so? In our case, this was a matter of local political culture. The people have always done that, because we feel that we are accountable. We are already doing this at the provincial level. Since these are essentially the same members of the executive, we also do this at the federal level. It is not about laundering money. Currently, there are no rules for riding associations, nor for the money used for political purposes outside of riding associations. It is partly for this reason that we have presented this bill.

  (1200)  

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Saada.

[Translation]

    Mr. Jacques Saada (Brossard—La Prairie, Lib.): Thank you, Madam Chair.

    Mr. Minister, I must tell you that I am extremely happy to see the list of amendments that you have proposed today. Of course, as you know full well, we have some concerns which were not resolved in the act or in the amendments, but I must tell you that these amendments are most welcomed. I would like to make two or three comments, and they all pertain to a concern that I have expressed on several occasions.

    Hon. Don Boudria: Fine.

  (1205)  

    Mr. Jacques Saada: This is not only an intellectual concern, but one that is also based on my experience as president of the Quebec wing of the party in the early 1990s. You said that a portion of the public funding could be allocated directly by the chief electoral officer, who would be authorized to do this by the leader of the party, to a provincial or territorial branch. This is a very interesting idea.

    However, I am not sure that I understood that the same principle would apply to income tax receipts. I would like to emphasize the following point. I am speaking on behalf of the Liberal Party, because I do not know the other parties well enough, and I would leave the door open. Of course, I am still talking about options, not obligations.

    For example, there is a very clear provision in the by-laws of the Liberal Party of Canada, Quebec wing, that allows us to put a riding that is not being properly run under the protection of a trustee. If the bill before us allows ridings to issue tax receipts and they are put under the protection of a trustee by the Quebec wing—I would remind you that I am referring to the provincial and not the national by-laws—, would there not be a contradiction between the authority to put a riding into trusteeship and the fact that the riding would not be able to issue receipts for income tax purposes? Would it not be appropriate to add a much more general provision to the bill, which would go a little bit further than your amendment. It would simply state that the parties that so wish could allow their provincial and territorial associations to provide income tax receipts?

    I think that there are two fundamental principles here, and this is more a comment than a question. Our party, the Liberal Party of Canada, is a federation. I think that allowing the national party to authorize the provincial wings to issue receipts for income tax purposes would be contrary to the spirit of a federation. I think that the very spirit of the federation should allow the provincial wing to exercise this right and issue receipts for income tax purposes directly.

    Hon. Don Boudria: I want to make sure I understood your comments properly. I will answer and if I did not interpret properly, you can correct me.

    At the present time, there is no prohibition on provincial or territorial associations to issuing receipts for income tax purposes. The party leader is the one who decides to appoint an agent for the provincial or territorial association.

    Mr. Jacques Saada: In your amendment.

    Hon. Don Boudria: No, that is already the case in the present legislation. That already exists for our party in at least two provinces. So we issue our own receipts for income tax purposes. As to the accounting side, it is at the end of the year, when we want to know how much money the party has received, that we add up all the money but the provincial and territorial association issue their own receipts for income tax purposes. That remains so.

    I think that the second part of the question had to do with the possibility of a riding association being put under trusteeship. I did not use the word "trusteeship" but that is almost what it is. In my opinion, in a bill that establishes enabling legislation, we cannot do otherwise than say that the authority of doing this rests with the leader.

    That said, one would have to draft amendment to the bill so as to say with greater certainty—and I do not see why this could not be done—that this power to put into trusteeship or not can also be delegated by the party leader to a provincial or territorial association.

    Mr. Jacques Saada: I am sorry, but that was not my question, minister.

    Hon. Don Boudria: For example, that would mean that the president of the LPC(Q) might decide that only the LPC(Q) may issue income tax receipts for 12 or 15 ridings in Quebec, provided prior authorization has been given by the party leader.

    Mr. Jacques Saada: I am sorry, but maybe my question was not clear. I wanted to know if in the two cases you set out...

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Saada, you're at five and a half minutes.

    Mr. Jacques Saada: I don't understand the answer, that's my problem.

[Translation]

    I want to know if in all cases where the provincial or territorial organization can issue receipts for income tax purposes, it was authorized to do so by the leader or by the party. Is it the president of the party or the leader who makes the decision?

    Hon. Don Boudria: The leader.

    Mr. Jacques Saada: Fine.

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Proctor.

    Mr. Dick Proctor (Palliser, NDP): Thank you, Madam Chair.

    Mr. Minister, I have the same preoccupation Mr. Gauthier has with trust funds. It seems to me that what's being suggested here is simply a way to shelter the money that's currently in trust funds by rolling it into a riding association before January 1. I think that's really unfortunate. You indicated at the outset that trust funds are illegal, you want to close all the loopholes, and I think what you're proposing here has just given the few people who have trust funds a way to shelter that money. If you want some free advice, since it's the Liberal Party that seems to have these trust funds, why doesn't the Liberal Party conduct an audit now on those half dozen or whatever riding associations or individuals who hold trust funds and deal with it, so that the money can't be put into that riding association prior to January 1? That's my first observation.

    The second one is on this idea that if we lower the threshold, we wouldn't lower it for candidates. That sounds good in theory, but in your earlier appearance you referred to women members and the need for a level playing field. It seems to me--and I agree wholeheartedly with Mr. Reynolds on this point--that what you're doing here is saying, if you have money, it's going to be easier for you to win a nomination. I would really ask you to look at that in a serious way.

    The other thing is about the limits. You said there could perhaps be a slight reduction, but you didn't address the fact that if it were $8,000, which is the figure that you threw out, it would be for--

    Hon. Don Boudria: I also used $7,000.

    Mr. Dick Proctor: Okay, $7,000, but you did not say a total of $7,000. The way the legislation is now, it's $10,000 per registered party. Would you be amenable to fixing that, so whatever the figure is, it's an aggregate number, not per party? That's what the legislation now reads. Somebody could give $10,000 times the number of registered parties, if they so chose. Everybody says that's crazy, it wouldn't happen, but if the idea is to take money out of politics, surely that would be useful.

    Finally, the $1,000, to me, is like the principle of not going to war with Iraq, but then saying, but the 31 troops we already have in the theatre can stay there. Surely to goodness--and the vast majority of witnesses said this to us--the $1,000 doesn't make sense. It's such a picayune amount of money that it's not going to be worth a candle. There are going to be all kinds of problems, and this legislation would be much better off without it.

  (1210)  

    Hon. Don Boudria: I'll forget the Iraq stuff and respond to the serious issue, because this is a serious bill.

    Mr. Dick Proctor: That's pretty serious.

    Hon. Don Boudria: I didn't propose an amendment for trust funds. That's not at all what I said.

    Mr. Dick Proctor: You talked about the January 1, 2004, date, and you specifically said trust funds and others.

    Hon. Don Boudria: The point is this. There's no exemption proposed here for anybody. The riding associations now can have 10 bank accounts in their names. I'm sure many of them have more than one--this is the fund to re-elect our candidate, the bank account to pay our monthly bills, the bank account to save money for the next annual general meeting in Toronto, or whatever they have separate bank accounts for. If we're going to consolidate all that and moneys associations have that aren't registered any place, and of course, there's no official registering anyway, because there's no law right now, I'm saying all that works far better with a hard and fast date. If there are any funds, trust funds or whatever, they would cease to exist, they would all be the property of the association.

    Mr. Dick Proctor: They're all going to get rolled back in before January 1.

    Hon. Don Boudria: If the honourable member is suggesting that it's better, if anybody has funds, to keep the money rather than put it in part of an accountable electoral process, I do not share that view.

    Mr. Dick Proctor: This honourable member is not saying--

    Hon. Don Boudria: I'm of the opinion that the right approach is to put it in the political process, to make it accountable, the way we have at all levels in the past.

    On the issue of aggregate limits, I don't know of any provincial regime that has that. If someone can show me that someone has a limit and they can't give to another party, I'm willing to look at it.

    Mr. Dick Proctor: A total of $3000 is what Quebec has, not $3,000 times the number of parties.

    The Vice-Chair (Mrs. Carolyn Parrish): We're going to have to stop this. I think you both made your points.

    Mr. Cuzner.

    Mr. Rodger Cuzner (Bras d'Or—Cape Breton, Lib.): I thank the minister for his presentation, and I agree with you that there is broad-based support for this legislation, certainly through the testimony we've had here at committee.

    Through the course of the hearings several presenters voiced concern with using the results of the past election to allocate the funds. Several methods were floated, using a check-off box on the income tax form, review of memberships, even polling to allocate funding. I'll ask for your comment on your comfort level with the method that's proposed in the legislation. Do you think it's the fairest and most practical way to go about the allocation of funds?

    Second, you commented on the $1.50 per vote and whether that was too high, too low. The official opposition contends that it's going to be a windfall for the governing party. I've seen figures where it's pretty much revenue-neutral. There are people on our side who believe it's going to be devastating to the revenues on our side. I guess the technical question is, if the $1.50 isn't right, how do you get that adjusted?

  (1215)  

    Hon. Don Boudria: On the system whereby you find the number by which to multiply the $1.50, I've heard some of these things, memberships being one. A membership card for our political party in Newfoundland didn't even exist when I was first elected in 1984. There was a convention in that particular jurisdiction, but you did not have a membership card. How did you choose a Liberal candidate in that area? Everybody who went to the meeting voted, period. It was a form of primary, at which 100% of the population were deemed to have been registered, so it worked. So one cannot use the system of how many membership cards exist. I don't think it's an appropriate threshold at all. As for rolling polls as the determining factor, I really don't think that's practical either. At what frequency? A rolling poll based on what issue?

    The only thing that's truly scientific and the only thing that really works, as far as I'm concerned, in a democracy is how the people have exercised their franchise. People exercise their franchise by voting for their candidates in their constituency, and that's the true test. Anyway, it's the only one that's ever been used in this country. It's used at the provincial level in Quebec, Prince Edward Island, and New Brunswick, though with different formulae.

    On the amount itself, it is revenue-neutral, based on our party, and with some other parties, it's more generous. Be that as it may. After we have the next election, the odometer will go back to zero, as I said before, and then you multiply it by the number of votes each party got. If the voters show that a particular party doesn't have much support, well, not much support times $1.50 is not much money. One translates automatically into the other. It's been used. The director general of Quebec has spoken here and he said it works fine in his jurisdiction. I don't know if the other two have. I've certainly heard very little complaint about how the public subsidy is administered. It's the only formula that exists.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Borotsik.

    Mr. Rick Borotsik (Brandon—Souris, PC): Thank you.

    What Mr. Cuzner asked was my fourth point, but I'll make it my first now to have some consistency.

    There is another system, and it's in the United States, where all registered parties receive an equal amount. There is no inequality there, and we haven't looked at that. You're looking at past electoral history in order to fund the future, whereas in the States they say, if you're a registered party, you will receive this core funding, and from that point on you go out and raise your money whichever way you will to augment it. Have you considered that base funding for all the registered parties, the legitimate parties within the House of Commons?

    Hon. Don Boudria: The last words say it all, the so-called legitimate.

    Mr. Rick Borotsik: Okay. Registered parties with certain votes.

    Hon. Don Boudria: I'm not making fun of the point you raised, but I--

    Mr. Rick Borotsik: Please don't. The fact is that we have official parties.

    Hon. Don Boudria: This is what becomes the issue. What are the political parties you would reimburse, not reimburse, and so on? Surely that is determined by the voters at election time. If you don't vote for someone, they don't get any. That is about the purest test of legitimacy that can be found anywhere in a democracy, recognizing that nothing is perfect.

    Mr. Rick Borotsik: The fact is that we do in this House have a formula to recognize official party status in the House, and it's not a difficult thing to also base core funding on that.

    This legislation does not in any way, shape, or form stop trust funds.

    Hon. Don Boudria: Yes.

    Mr. Rick Borotsik: How does it do that?

  (1220)  

    Hon. Don Boudria: It's simple.

    Mr. Rick Borotsik: No, existing ones can be rolled in.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Borotsik, this chair is very intolerant of debating with a witness. I would like you to ask a question and give the minister an opportunity to answer.

    Mr. Rick Borotsik: Thank you, Madam Chair, and I'm sure you will keep in mind that it works both ways.

    The Vice-Chair (Mrs. Carolyn Parrish): Yes, I will.

    Mr. Rick Borotsik: How does this stop a trust fund, or a funding set-up?

    Hon. Don Boudria: We will get the information for you on actual references in the bill, but it does not permit their establishment. It's not possible to have funds, after the bill comes into force, outside a constituency association, or the one registered to a candidate when the candidate becomes registered for election after the issuance of the writ, or a political party. No other money, except that coming from the taxpayer, can be used in elections. Funds that were not receipted cannot be used. If you had a trust fund for administering something on behalf of the Red Cross, that's not part of the bill, but the money can't be used for elections anyway. No money used in elections can be outside the process in the bill. So if you have other money, whether it's personal money or business money, it can't be used. Trust funds for elections won't exist.

    Mr. Rick Borotsik: Thank you, Mr. Boudria. It will be an interesting opportunity to try to enforce and maintain that.

    You'd mentioned at the very end paid scrutineers. That was an amendment you threw in at the bottom there. If you pay your scrutineers, that should be seen as a personal expense of the candidate. Would that also be an expense that is refundable under the act? Could they then go back, claim that as an expense, and get reimbursed their 50%, if in fact they received their 15%?

    Hon. Don Boudria: Yes, that's correct. That's the definition.

    Mr. Rick Borotsik: Okay.

    The Vice-Chair (Mrs. Carolyn Parrish): Could I just ask for clarification on that? I thought personal expenses in an election even now are not reimbursable from Elections Canada. You're allowed to spend them up to the limit, but they're not reimbursable.

    Hon. Don Boudria: I'll check on that.

    Mr. Rick Borotsik: What I was trying to get at is whether this is going to be an expense that could be reimbursable? That's all I'm asking.

    The Vice-Chair (Mrs. Carolyn Parrish): We're going to find that out, Mr. Borotsik, and thank you very much.

    Hon. Don Boudria: We're going to find that out, but the purpose is to make it a candidate's personal expenditure, which it was prior to Bill C-2.

    The Vice-Chair (Mrs. Carolyn Parrish): Thank you, Mr. Minister.

    Mr. Regan.

    Mr. Geoff Regan (Halifax West, Lib.): Thank you very much, Madam Chair.

    Mr. Boudria, thank you again for coming today.

    I have a few questions, and one relates to the indexing. I note that in the new section 403.39 the limit on the amount the auditor can be reimbursed by the Government of Canada is $1,500. It's not indexed. A concern I have is that some amounts are indexed, others aren't. Why, for instance, in the new subsection 435.01(2) is the 37.5¢ per quarter that would be given to each party and so forth not indexed, whereas the $1,000 and $10,000 limits on individual corporate donations are indexed? What is the reasoning behind indexing in some cases and not others? With the $1.50 per vote, if you have 80,000 people in your riding, the cost to send out a mailing to all of them will go up over time as a function of inflation, as well as perhaps as a function of population increase. So why not index that, because the costs of running an election are going to increase through inflation?

    Hon. Don Boudria: The problem we have is that the existing legislation has some things indexed and others not. For instance, the auditor fee has never been indexed. If you want to make some recommendations in that regard, I'd be prepared to hear them.

    With the $1.50, because that involves a large amount of money, perhaps we'd be better not to do it, to wait a few years for a review of the Elections Act. After every election it's automatic anyway; this committee has had to review it before. You could use that as the basis for triggering a change. If there are any things you want to change in that regard and where we can come to an agreement, we may not be able to do so, because it may involve a royal recommendation. If the committee wants to prepare a written report, I'm certainly willing to look at that and provide the royal recommendation at report stage, if there are cases where you think that indexing provision would work better. But please remember that after every election we redo this thing.

    Incidentally, under Bill C-2 we increased tremendously the amount for auditors. It was only a small amount before that, and it came to our attention that it was getting harder and harder to find auditors. People were doing it almost as a charity, and many of them who were busy said they had other things to do.

  (1225)  

    Mr. Geoff Regan: I have a couple more technical questions, and one is in relation to the new section 403.22 on page 14. It provides, after redistribution, that a riding association “may transfer goods or funds to the registered party with which it is affiliated or to one of that party's registered associations in the six months after that day.” When you have redistribution, you end up having to write cheques not just to, in my case, the new Halifax West, but to Halifax, to South Shore, because of the way the boundaries go. You're losing parts of your riding. I will perhaps be, I foresee that. So why not say “to one or more”?

    Hon. Don Boudria: Agreed. It is, I'm told, a drafting error and it will be changed to reflect that, because on redistribution, the last quarter mile on the east end may be moved to that riding, the last quarter mile on the west end the other way, and part on the north end.

    Mr. Geoff Regan: On page 27 of the bill the new section 404.4 refers to a receipt for everything more than $10. We talked about that, about whether it should be $25, earlier, but is there any reason not to specify that a receipt is required by the Income Tax Act, so that every receipt they give is an official receipt?

    Hon. Don Boudria: I'll ask Madame René de Cotret to answer.

    Ms. Michèle René de Cotret (Senior Privy Council Officer/Counsel, Legislation and House Planning/Counsel, Privy Council Office): The requirement in proposed section 404.4 is an ordinary receipt. There are already provisions in the Income Tax Act, and we're proposing to add something in the provisions dealing with the receipts as well.

    Mr. Geoff Regan: But could you use the ordinary receipt you'd get here for your income tax? It would have to be one that has the official number and all that, wouldn't it?

    Ms. Michèle René de Cotret: Yes, absolutely.

    The Vice-Chair (Mrs. Carolyn Parrish): Before we go into the second round, I would like to ask the minister how long we still have you for--as long as we continue being nice.

    Hon. Don Boudria: Maybe until 1 o'clock or so, as long as I have time to eat something.

    The Vice-Chair (Mrs. Carolyn Parrish): Okay.

    I'd also like to keep everybody's questions as concise as possible.

    Mr. Reynolds.

    Mr. John Reynolds: Thank you, Madam Chair.

    Mr. Minister, the more I look at what's going on with this bill, the more I think you should probably change the name of it to the Incumbents Protection Act. I agree with Mr. Borotsik's comments on how the money is being raised, and I share some of those same concerns. There's nothing in this act that does anything for somebody who wants to run as an independent in this country, which I think is an absolute right anyone has. You shouldn't have to belong to a political party. Independents don't win very often, but they have won seats in the past. If I were to decide to run in my riding as an independent and win, why wouldn't I be entitled to receive a cheque on the number of votes I got, so that I can fund my own operation between elections? I use the example of Newfoundland, where they're looking at their role in Canada right now. Say a party pops up in Newfoundland with candidates that have that idea, they all run in the next election, and they all get elected. We won't be giving them cheques every quarter, because they won't be a registered political party, they don't have over 50 people running in an election, and yet I think they have every right to get those cheques every quarter.

    So this is a nice bill to protect all of us and all of our parties right now, but it certainly does a great deal in preventing new ones from starting up, unless you have 50 people you can run. In the province of Quebec you can run 75 candidates if you're a party that just represents Quebec, but if a British Columbia party wanted to start up that had a different viewpoint from the traditional parties, we have 34 seats under the new system, so it couldn't be a registered political party. If they elected 30 people, they could come here, and they still wouldn't get a cheque every quarter. I think you should look at this bill and put something in it that would protect independents running or smaller parties in provinces that don't agree with what the national parties are doing right now. It's not there.

    In the U.S. system, which has its faults, they ban corporate donations. I worked for a very large American corporation, and once a year the president sent a letter out and everybody was expected to kick in $1,000. If he didn't see your name on the donation list, you probably wouldn't work there much longer. That's how they raise millions of dollars per riding. It's just knowing that corporations donate money through the management and employees.

    Finally, Mr. Minister, you mentioned your riding, where you publish your financial statements. I congratulate you for that. In my party that's policy. If a riding does not present a financial statement--it doesn't have to be audited, but it has to be reviewed by an auditor, with comments--to party headquarters once a year, it loses the right to be an association. At our annual general meetings our statements provide one of the longest sessions, because everybody goes through them with a fine-tooth comb, money raised and what it's spent for. So I think that's a good idea.

    But I'd like your comments on these individuals and smaller parties that might want to start up. Why wouldn't we make sure they can be protected and get money to keep their operation going, just because they're not a registered political party with over 50 people?

  (1230)  

    Hon. Don Boudria: These are not part of the bill. The provisions of the existing act cover how you become a new party. I'm trying to remember some of them. The 50-candidate threshold is one of them, but it's not the only one. I believe there's also another mechanism by which you get the signature of 10,000 voters, but that is beyond the scope of this bill. The 50 candidate count is not the only mechanism by which one becomes a political party for the next election. Take the example of the 22.5% we get now for a political party.

    Mr. John Reynolds: An independent member now can issue tax receipts and raise money. He's the same as the rest of us. This bill eliminates those people from getting the same amount of money I'm going to be able to get from the government.

    Hon. Don Boudria: The bill deals with constituency associations of political parties. But a candidate in an election, whether they run as an independent or otherwise, can certainly raise--

    Mr. John Reynolds: He doesn't get money between elections as the rest of us do.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Reynolds, I remind everybody that we're not debating with the minister, we're asking questions.

    Hon. Don Boudria: There is a $10,000 limit that exists.

    The Vice-Chair (Mrs. Carolyn Parrish): Okay.

    Madam Catterall.

    Ms. Marlene Catterall (Ottawa West—Nepean, Lib.): The bill contains a provision to limit spending for a nomination to a percentage of the allowable expenses during an election period. You have provisions in there on what level of reporting is required for nomination expenses. It seems to me that it would be sensible to base those also on a percentage, so that they keep pace with inflation, rather than having to be adjusted every few years. Is that something you're prepared to consider?

    Hon. Don Boudria: In the little bit of time we've had lately I've looked at a formula like that. I invite colleagues to contribute to the process. The limit was $500. Some people said that's so small, there's a lot of paperwork for a $750 donation, let's increase it to $1,000. While we're at it, there will be two ways of dealing with that. We could, as someone suggested earlier, index it, or we could fractionalize it. The maximum, generally, you're allowed to spend on an election campaign is $60,000, so $1,000 is about 2%? You could say, you can spend 2% of what you spent last time, and only beyond that would you be called upon to provide a statement. If you went beyond 10% or something like that, that would be the new threshold at which you would provide an audited statement based on the number of votes from last time, a percentage thereof. It's certainly another way of doing it, providing we get roughly the same numbers. The only concern I would have is that Elections Canada find it a way that is not hopelessly complicated for them to work on, but if they're prepared to live with that, I would have no difficulty with it.

  (1235)  

    Ms. Marlene Catterall: I think you suggested that the limit beyond which you'd have to do more in-depth reporting would be about $10,000.

    Hon. Don Boudria: That's in the bill.

    Ms. Marlene Catterall: That's what's in the bill now?

    Hon. Don Boudria: Yes.

    Ms. Marlene Catterall: That's based on being able to spend 50% of the election expenses on nomination. If the committee were to consider lowering that to something like 20%, with your spending limit at about $12,000, would you still consider it necessary to have that more in-depth reporting?

    Hon. Don Boudria: I suppose if you're telling me that if the overall spending limit was almost the same as the threshold beyond which you would have to report with an audited statement, there wouldn't seem to be much purpose for that, would there?

    I encourage people to be cautious, though. We all think that amount shouldn't be too high, the amount that one is entitled to spend for a nomination, but if you make it too low.... It's fine if you've exempted personal expenditures, but if, in the process of that happening, people have to open headquarters, for example, there has to be money to pay the rent and do other things candidates might legitimately want to do, not paving the streets with gold and buying truckloads of beer the night of the nomination. There are legitimate expenditures, campaign literature explaining the candidate's program, visiting different communities. Of course, we would exempt the travel part, because that's already exempt for a candidate for election, but there are still lots of other things that are not exempt, and they're very expensive.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Minister, thank you.

    Mr. Guimond.

[Translation]

    Mr. Michel Guimond (Beauport—Montmorency—Côte-de-Beaupré—Île-d'Orléans, BQ): Thank you, Madam Chair.

    I find it is unfortunate to use my time for that, but I would like to come back to the answer you gave Mr. Reynolds. You told him you were going to check as to whether an independent candidate could collect funds and issue receipts.

    Hon. Don Boudria: During the election campaign.

  (1240)  

    Mr. Michel Guimond: In 1993, unless and until 50 nomination papers were received by the chief electoral officer, even during the election campaign, receipts for income tax purposes could not be issued. There had to be 50. At least, that has been the case to date. I will check again.

    Hon. Don Boudria: We are talking about an independent candidate during an election campaign. When John Nunziata ran, for example, he gave out receipts after the writ was issued. Of course, the matter of 22.5 per cent of the collective expenses by a political party or an independent group, and that is what the Bloc Québécois was before it was registered, did not exist. However, the candidates could issue receipts and be reimbursed for 50 per cent of their expenses at the individual riding level as long as they garnered 15 per cent of the vote. The bill now provides for a 10 per cent threshold.

    Mr. Michel Guimond: You established two main principles before introducing the key questions that will be amended. I have made note of nine of the key questions. The two major principles are first that the limits cannot be reviewed, in the sense that there is no leeway possible concerning the $1,000 amount, as well as the fact that there cannot be no limit. I understood you correctly on that. Then you said that if we made reference to ethics or the code of ethics, that this did not fall under the purview of the bill. Is that correct?

    Hon. Don Boudria: I gave you that example, but in the second case, it goes much further: the main legislation cannot be amended. I have set out the two concepts. I did not invent them. They already exist.

    Mr. Michel Guimond: There are two things, among the nine key questions, that I would like to look at again. First, there is the limit on individual contributions. You recognize that the $10,000 amount is too high and you say that you could be convinced to decrease it, but you do not know by how much and you want the committee's opinion. You can answer after, if you want, but would an amount of $3,000, the Quebec limit, be acceptable?

    My second question has to do with the $1,000 amount for corporations and unions. There are a lot of witnesses, especially from corporations, who made us aware of the danger represented by subsidiaries. They said that a subsidiary has its own legal personality. Say the head office gives $1,000. If it has 624 subsidiaries in Canada, can each one of the subsidiaries with its own legal personality also give $1,000? Those are two elements that show up in your key questions.

    I would also like to know your opinion on one thing that is not included in the bill. You could have and you could still introduce amendments on this. It is the whole matter of the appointment of returning officers. The Quebec system was described by Mr. Blanchet and, yesterday, by the director general of the Parti Québécois. We know that the present system leads to partisan appointments. Sometimes they are people quite able to do the work properly, but they are totally incompetent. In any case, Jean-Pierre Kingsley agrees with this committee in saying that he expects that the minister, that is yourself, will suggest amendments to review the appointment of returning officers so that they will no longer be political appointees.

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Perhaps I can encourage you, Monsieur Guimond, to stop asking questions, because you're not going to get any answers.

    I'm going to give you about one minute, Don.

[Translation]

    Hon. Don Boudria: Without a doubt, Madam Chair, the $3,000 amount, in my opinion, is far too low. I think that even in Quebec, it is recognized that this amount is not high enough, particularly when you have to campaign all the way from Vancouver to St. Johns, Newfoundland. That mades things even worse. There is no doubt that the amount is too low.

    As for subsidiaries or local branches, there is no doubt in my mind that the Royal Bank of Canada may not make a contribution for every wicket it has or for every place of business it has. It is a corporation. If a corporation gives an amount of $1,000 in the riding of Vancouver Kingsway, it cannot give anything in the riding of Glengarry--Prescott-Russell because it has already exhausted its national amount.

    The issue of returning officers has nothing to do with the bill on political party financing we have before us. That is totally outside the purview of this bill.

[English]

    The Vice-Chair (Mrs. Carolyn Parrish): Thank you, Mr. Boudria.

    Mr. Jordan.

  (1245)  

    Mr. Joe Jordan: There's the notion that we don't want corporate money going to the party. To bring this down to the local level--I realize we're getting into party matters, but this is affected by the bill--if I in a non-election year raise $10,000 through 10 corporate donations to me, I have to give the provincial party $6,000 a year, under their rules. Am I not giving corporate money to the party?

    Hon. Don Boudria: That would really be, I think, stretching it. It would have to assume that pretty well 100% of what you raised was corporate, that is the only money you have, and you give all of it to pay for your fees.

    Mr. Joe Jordan: You see my bank account.

    Hon. Don Boudria: I don't see a contradiction. Let's say you took your money from the account that you have in your association to pay the delegate registration fees to go to the convention and that cost $300, but the expenditure for the party for holding the convention is $250, does that mean there's an inherent $50 corporate contribution? That's really picking at straws, because every party raises money through its membership, through its other activities. You almost couldn't concoct a scenario where you would get all your money that way, let alone giving it all that way. In any case, virtually all riding associations have the funding they receive as a result of the previous election rebate that comes from the taxpayers.

    Mr. Joe Jordan: I'm just trying to determine what standard drives the policy.

    I understand Elections Canada, with the franchise question, has deferred to CCRA. If a business in a community qualifies for the small-business tax credit, it's determined to be under control of that manager, and therefore it's an individual entity and can give. That means Tim Hortons would qualify for the small-business tax credit in my riding and could give to me, if they all decided to act in unison--I don't know how many Tim Hortons I have, but probably 30--whereas another company that doesn't qualify for that tax credit, let's say Shopper Drug Mart, can't. In this bill we have an inherent bias based on decisions that were made independently of the implications of this and how they set up their structure according to the tax laws of the country. I'm wondering if that is an unintended consequence and if anyone has given it any thought.

    Hon. Don Boudria: There are a number of these enterprises that have both corporate entities and franchisees, which means you pay somebody to sell the product with their name on it. Whether that product is a tomato or a hamburger doesn't really matter, it's an independently owned business in the constituency. For instance, one chain of stores in the Ottawa area is called Giant Tiger. In my constituency there are corporate Giant Tiger stores, but there are also people who own stores and sell Giant Tiger products. That's their own business, that's their own corporate identity, they just happen to sell their products, it's not the same. They're a franchisee, in other words.

    Madame de Cotret maybe has a further technical explanation.

    Ms. Michèle René de Cotret: I want to confirm up to a point what I think is already in the bill in proposed subsection 404.1(2). The language that is in the bill at the moment tailors what is in the Income Tax Act to determine what's a corporation and what's not. Les filiales are not independent corporations. But you're correct, a franchise, if it's independently owned and incorporated, would be a corporation.

    The Vice-Chair (Mrs. Carolyn Parrish): Before I go back to Mr. Proctor and Mrs. Catterall, who are on second rounds, I'm going to take this opportunity to ask a couple of very quick questions myself.

    The more I listen to the complexities of corporate donations, the more I think they should be banned outright. It's just like when we did the code of conduct. We came in with the concept from the drafter of the legislation that spouses should declare, then we changed it, and it came back to that being the most sensible thing to do. So I think banning corporate donations completely is probably the safest, cleanest, and best thing to do. I'm inventing that wheel, because if Joe's Pizza Parlour wants to give me pizza, which was the excuse everybody used, he can give it to me personally.

    Second, I think that the personal donations of an individual should be dropped to $5,000, and I think that $5,000 donor has to break up his donations into $250 packages to people. Then he can give to many people and share the wealth, share the enthusiasm, share the participation. I think a $5,000 donation or a $10,000 donation is outrageous.

    Third, I think of the $1.50 that's rebated, and I'm always thinking of some other purpose. If a $0.50 portion of that went to the local riding association and $1.00 went to the party, it would encourage me. Instead of cruising along on election day and not really pushing my workers too hard, you'd encourage me to push them to get my vote out as hard as possible, because our voting turnouts are going down every year. If some of that money went to the riding association and some went to the party, I think you'd get every candidate working that much harder to get the voter turnout up, which would actually serve two purposes. I'd like your comment on that.

  (1250)  

    Hon. Don Boudria: I want to start with the last one. I really think that is going too far with internal party matters. For instance, deciding that a portion will go to a riding association that effectively doesn't exist, doesn't function, didn't have a candidate last time, or if it did, they only appeared on the last day, or there's just no support in that region, really goes too far. Instead, we're empowering the riding associations in the bill in a manner that is similar to what exists at the provincial level in Ontario and B.C., for those components anyway, where they can issue their own tax receipts. There have been forever complaints in many political parties that you send your statements and everything to Ottawa and it takes five months before they send the tax receipt. People get uptight and all that sort of thing. Now it's all done locally, providing, of course, that they've been authorized to do so. That's the way of working it.

    As to making the donations very small, you're just going to dry up the pool of funding political parties need to function. They're a legitimate part of the political process. If the amounts are made so small, I really think it would be difficult for the political parties as a whole. We are the second largest jurisdiction on the face of the earth, Canada. Leaders, when they campaign, officials of the party, when they travel, and all of these other things involve hopelessly expensive propositions, because everything is so far. It's not like the provincial party in that regard. There are tremendous expenditures in operating nationally. Fundraising at the individual level I think achieves that. To say we should bring it to amounts of $250, or whatever it is, times a certain number of districts really isn't going to address the issue of the political party being able to raise money at the central level. There's already some concern that there are not going to be corporate contributions. I don't agree with their assessment that this is restrictive, but surely, if you remove the individual contributions as well as the corporate ones, it's going to be more restrictive.

    The Vice-Chair (Mrs. Carolyn Parrish): Mr. Boudria, I'll ask one more question. We've heard from many people that they'd like free time on television. I know it's outside the purview of the bill, but would it be appropriate for this committee to recommend that it be looked at as part of our report to the House?

    Hon. Don Boudria: That would be outside formal amendment, but if the committee has a written report, we could explore it, if that's something that could be ready in time, should it be agreeable. I haven't studied that policy option, submitted it to cabinet colleagues, or anything else. Of course, it's not in the bill. It would have to be the subject of a written report by the committee, as opposed to a natural amendment to the bill.

    The Vice-Chair (Mrs. Carolyn Parrish): Okay.

    Mr. Proctor, three minutes.

    Mr. Dick Proctor: Thanks, and thanks for raising that, because I think it's a good suggestion about the Broadcast Act. There were indeed a lot of witnesses who spoke about that.

    I'm disturbed at what I've just heard in response to Joe Jordan's questions about independent business operations versus franchises and whether or not they can donate $1,000. I'm concerned about it from a trade union aspect, because trade unions file differently from corporations and businesses. What I don't want to hear is that it will be all right for some businesses, depending on how they are recognized by law, to donate $1,000, but various locals of different trade unions will be restricted and will only be able to file $1,000 in total. You used in your example, Mr. Minister, the notion that you have a head office of a bank or a large business and they decide that they're going to donate $1,000. Well and good, but trade unions can be extremely autonomous organizations that exist all over the country, and they will have no clue in British Columbia Local 123 about what Local 456 decided in Saskatchewan. I think we've got a real problem if this playing field isn't extremely level on this point.

  (1255)  

    Hon. Don Boudria: I do believe it is extremely level. I think the allegation that's being raised here is that the management of the bank would have different prerogatives from the local union, the employees of the same organization. That's not correct. If we're talking about the hardware store in my constituency, there's no parallel on the union side for that. That is a locally owned enterprise. That means they buy the product from an office in Guelph, or wherever it, called the Home Hardware company. They sell Home Hardware goods, but it doesn't belong to Home Hardware. I know the guy. He buys the products he sells there. That's not an affiliate or anything like that. That's quite clear in the act, and I invite you to refer to the section that Madame René de Contret brought to your attention a while ago. There's no intention in the bill to permit repeated contributions from the same corporation. That is not at all what it's designed to do. It's designed to do the opposite, to ensure that ma and pa's hardware or corner store or whatever it is can contribute at the local level. That's all it's designed to do. And there have been consultations with the labour unions about that clause too.

    Mr. Dick Proctor: I'm aware of that, but just so I'm perfectly clear on this, I think Joe mentioned Tim Hortons. Are we saying that under some circumstances, various Tim Hortons will be able to donate $1,000 per year to an individual?

    Hon. Don Boudria: I don't know the corporate structure of that particular company precisely, but let me give you an example. Many companies sell products that are manufactured by other companies. It's not impossible that Tim Hortons is that way. I know McDonalds is. McDonalds has no corporate outlets, they belong to the company, there's only one company, at least in Canada. There is, of course, such a thing as a franchisee. That means you sell their brand of hamburgers, but you own your own business. That's the difference.

    Mr. Dick Proctor: But there's no way that a trade union local would be able to donate $1,000 to their local candidate, correct?

    Hon. Don Boudria: It depends how they incorporate it, I suppose. If the trade union is one trade union, of course not. I'm not sure what that has to do with Mr. Jones selling a particular variety of donuts in the store he owns.

    Mr. Dick Proctor: What it has to do with it is the demonstration of a very unlevel playing field.

    The Vice-Chair (Mrs. Carolyn Parrish): Can I just interrupt for a second? I think this is a little complex, and I'd like to know the answer myself. I'm wondering if the minister could provide us with something in writing before our next meeting, when we come back after the break.

    Hon. Don Boudria: Absolutely.

    The Vice-Chair (Mrs. Carolyn Parrish): Madam Catterall.

    Ms. Marlene Catterall: I'm sorry Mr. Reynolds isn't here, as he called this the Incumbents Protection Act, and I see it as just the opposite. It's easier for us to raise money than for a newcomer. I think by putting limits, and very strict limits, on spending for nominations, we make it easier for somebody to challenge us, and I personally welcome that.

    My question has to do with trust funds. Could you let me know very clearly if trust funds have to be dissolved for the purposes of this legislation, when it comes into effect. Further, a very specific question, I have a trust fund in my riding left over from the previous member of Parliament, and it's used during elections to borrow money to start up the campaign, if necessary, and it's repaid. Would that be illegitimate?

·  (1300)  

    Hon. Don Boudria: No, there's nothing illegitimate about that. That means a separate bank account. Whether the constituency association has four bank accounts or 19, the importance is that all the money or other belongings of the constituency association be duly reported, as 100% of it will have to be if it's to be used for political purposes in the future. That's why it's important to ensure that any funding that is out there is captured by the bill, so that in the future there won't be money used for political purposes that is unregistered. And of course, once you do register it, any new funds going into there will have to be receipted. At the present time a constituency association could inherit $10,000. The only thing you know is that next year there's $10,000 more in the bank account. There is no way of reporting that, no legal way. There may be in a public accountability way of the kind Mr. Reynolds has identified, where people have agreed to make something public, which is what we do in our riding, but that's not a legal instrument, it's not accessible to Elections Canada, it's not on their website. Of course, you couldn't use unreceipted money for any political purpose in the future. Whether or not they have more than one bank account, I don't think that's relevant.

    The Vice-Chair (Mrs. Carolyn Parrish): I would like to conclude by asking you for another document, if you would be indulgent. We have several types of trust funds, Mrs. Catterall's talked about one that's in the riding's name.

    Ms. Marlene Catterall: It's in the former member's name.

    The Vice-Chair (Mrs. Carolyn Parrish): All right, but it's one you and your riding have access to. There are other ones we're all thinking of and not telling you out loud that are under the names of members of Parliament as individuals. We would like some sort of an explanation as to what happens to candidate X who currently sits in the House of Commons and has this trust fund in his own name of $200,000 plus. What happens to the ones Mrs. Catterall describes, which are in effect a separate bank account? What happens to the ones that are in existence right now? If you can give us that in writing before we start deliberating clause by clause, I think it's going to clarify a lot of things for us.

    Hon. Don Boudria: I will gladly do so, maybe in the form of a chart. Please remember, though, that trust funds have been a euphemism for just about everything, which complicates it.

    The Vice-Chair (Mrs. Carolyn Parrish): I'm using the euphemism as well.

    Hon. Don Boudria: A trust fund that was established by someone pursuant to another piece of legislation to put money aside for the education of their grandchildren is of little concern to us today. We're talking about these funds, trust or otherwise, that have been put there and have been or could be used for political purposes. I'll try to identify as many varieties as I can and produce them in the form of a document.

    The Vice-Chair (Mrs. Carolyn Parrish): That would be extremely helpful, Mr. Minister.

    I want to thank you very much. This was a real education, it was very good. Thank you.

    Hon. Don Boudria: It was an education for me too.

    The Vice-Chair (Mrs. Carolyn Parrish): I hope so.

    Members of the committee, Mr. Boudria's presentation, with the exception of the very last piece, which I think he was formulating as he came through the door, is in English and French in a document that's been handed out to you.

    The meeting is adjourned.