HAFF Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Procedure and House Affairs

EVIDENCE

CONTENTS

Thursday, May 1, 2003

Á

1115

The Chair (Mr. Peter Adams (Peterborough, Lib.))

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

The Chair

Mr. Ted White (North Vancouver, Canadian Alliance)

The Chair

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

The Chair

Mr. Geoff Regan (Halifax West, Lib.)

The Chair

Mr. Rick Borotsik (Brandon—Souris, PC)

The Chair

Mr. Dick Proctor (Palliser, NDP)

The Chair

Mr. Lynn Myers (Waterloo—Wellington, Lib.)

Á

1120

The Chair

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

The Chair

Mr. Ted White

The Chair

Mr. Geoff Regan

The Chair

Mr. Ted White

The Chair

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

The Chair

Mr. Rodger Cuzner

The Chair

Mr. Michel Guimond

Á

1125

The Chair

Mr. Ted White

The Chair

Mr. Jacques Saada

The Chair

Mrs. Peggy Nash (Assistant to the President, Canadian Auto Workers Union)

The Chair

Mrs. Peggy Nash

The Chair

Mr. Hassan Yussuff (Secretary-Treasurer, Canadian Labour Congress)

Á

1130

Á

1135

Á

1140

The Chair

Mr. David Stewart-Patterson (Senior Vice-President, Policy and Communications, Canadian Council of Chief Executives)

Á

1145

The Chair

Mr. Rick Borotsik

Á

1150

The Chair

Mrs. Peggy Nash

The Chair

Mr. Ted White

Mr. Hassan Yussuff

Mr. Ted White

Mr. Hassan Yussuff

Mrs. Peggy Nash

Á

1155

Mr. Ted White

Mrs. Peggy Nash

Mr. Ted White

The Chair

Mr. Geoff Regan

Mr. Hassan Yussuff

Mr. Geoff Regan

Mr. David Stewart-Patterson

Â

1200

The Chair

Mr. Michel Gauthier (Roberval, BQ)

Â

1205

The Acting Chair (Mr. Ted White)

Mr. Michel Gauthier

Mr. David Stewart-Patterson

The Acting Chair (Mr. Ted White)

Mr. Jacques Saada

Mr. David Stewart-Patterson

Â

1210

Mr. Jacques Saada

Mr. David Stewart-Patterson

The Chair

Mrs. Peggy Nash

Mr. Jacques Saada

Mrs. Peggy Nash

The Chair

Mr. Dick Proctor

Â

1215

Mr. Hassan Yussuff

Mr. Dick Proctor

Mrs. Peggy Nash

Mr. David Stewart-Patterson

Â

1220

Mr. Dick Proctor

The Chair

Mr. Rodger Cuzner

Mr. Hassan Yussuff

Mr. Rodger Cuzner

Mrs. Peggy Nash

The Chair

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Â

1225

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Mr. Hassan Yussuff

Mr. Rick Borotsik

Mr. David Stewart-Patterson

Mr. Hassan Yussuff

The Chair

Mr. Ted White

Â

1230

Mr. David Stewart-Patterson

Mr. Ted White

Mrs. Peggy Nash

The Chair

Mr. Dick Proctor

Â

1235

The Chair

Mr. Ted White

The Chair

Â

1240

Mr. Ted White

The Chair

Mr. Jacques Saada

The Chair

Mr. John Reynolds

Mr. Michel Guimond

The Chair

Mr. Dale Johnston (Wetaskiwin, Canadian Alliance)

The Chair

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CANADA

Standing Committee on Procedure and House Affairs

---

NUMBER 037

l

2nd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Thursday, May 1, 2003

[Recorded by Electronic Apparatus]

Á  (1115)  

[English]

    The Chair (Mr. Peter Adams (Peterborough, Lib.)): The order of the day is Bill C-24, an act to amend the Canada Elections Act and the Income Tax Act (political financing), and we are continuing the hearings on this legislation.

    Our witnesses I would ask to be patient. I have notice of two courses of action. The first is from Michel Guimond.

[Translation]

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

    I'd like to make a correction to the minutes of yesterday's proceedings. When I put a question to Mr. Hellyer, I prefaced my remarks and in the process, made a somewhat inaccurate statement that I wish to correct at this time.

    I questioned him about the possibility of a company which numerous branches making a number of $1,000 donations, thereby allowing for the possibility of doing indirectly that which is directly prohibited by law. You may recall the example I gave, since I used it on two or three separate occasions. The Royal Branch of Canada, through its 365 different branches, could make numerous $1,000 donations to several candidates. I questioned the Chief Electoral Officer, Mr. Kingsley, about this and he told me that donations were capped at $1,000 and that if the Royal Bank wished to support all of a particular party's candidates, that $1,000 would be split among 308 ridings, with each one receiving $3.22. I thought he was joking, and most likely he was speaking in jest as well.

    I just want to state for the record that I never meant to imply in my response that the Chief Electoral Officer was trying to make fun of me. Mr. Kingsley, Canada's Chief Electoral Officer, is a man of great integrity who has a great deal of respect for parliamentarians and the parliamentary system, besides which he is a guardian of democracy. I just wanted to set the record straight about this at this time.

    Thank you, Mr. Chairman.

    The Chair: Thank you for your comments, Michel.

[English]

    Since you and I spoke, the staff have advised me that Mr. Kingsley has been in touch with us, and he assured me that he would be in touch with you. Thank you very much for that.

    Now the Canadian Alliance has something.

    Mr. Ted White (North Vancouver, Canadian Alliance): Last night at this committee we had Mr. Mercer from the Liberal Party as a witness. In this morning's National Post the president of the Liberal Party, Mr. LeDrew, is quoted as saying he has no intention of allowing Mr. Mercer to speak on behalf of the party, because the party does not support the financing legislation. Mr. LeDrew went on to say he is president of the party and he wants to put the party's views forcefully forward, he is not going to wimp out. Further, he said the bill could potentially bankrupt the Liberal Party.

    Mr. Chair, in light of the fact that there is tremendous disagreement apparently between the president of the Liberal Party, Mr. LeDrew, and Mr. Mercer, who was here last night, I would like to put forward a motion to the committee that this committee summon Stephen LeDrew, president of the Liberal Party of Canada, to appear before it and give evidence regarding Bill C-24, an act to amend the Canada Elections Act and the Income Tax Act. I think we have to make sure Mr. LeDrew attends this committee, so we can sort out why there is such a disagreement between top officials of the Liberal Party on this bill.

    The Chair: As you will remember from last evening, the plan today was to hear our witnesses, and I would urge, in common courtesy, that we do that. At the end of this meeting we would have a short--I thought it might be short--organizational meeting to consider where we are going next. Under “Other Business” that is what it says. Ted, that is now formally presented, as far as I am concerned. I would like, if possible, to leave it at that point and consider it again in our organizational meeting, and if necessary, debate it again in a full public meeting at the earliest opportunity.

    John Reynolds.

    Mr. John Reynolds (West Vancouver—Sunshine Coast, Canadian Alliance): Mr. Chairman, I don't think this will take very long. I think, with all due respect, it's a very simple question. I don't think there are even any objections from members on the other side. I would move that the question be put.

    The Chair: My position was a matter of common courtesy. I'm in the hands of the committee, and I might have to get a vote to that effect, but I would strongly urge that we do not keep witnesses waiting here. I already have a number of people, who can speak very briefly.

    Geoff Regan.

    Mr. Geoff Regan (Halifax West, Lib.): Mr. Chairman, I think your suggestion makes eminent sense, that we should have an opportunity to discuss this matter. We've had a variety of discussions on the question of witnesses, and we should have more discussion on those questions. I think it's vital that we show respect to our witnesses and hear from them.

    The Chair: Rick Borotsik.

    Mr. Rick Borotsik (Brandon—Souris, PC): Mr. Chairman, last night we had witnesses before us, and you took a substantial amount of time to detail a lot of future business. I think we should finish with this one right now. It's a simple motion, let's deal with it. I have three or four other things I'd like to put on the table as future business, but I would certainly echo the comments of the Alliance Party, and I would move that we take a vote on the motion.

    The Chair: Dick Proctor.

    Mr. Dick Proctor (Palliser, NDP): I agree with the proposal that the chair of the committee has made. I urge that we discuss it at the end of the meeting. If you insist on voting on it now, I shall be voting against it.

    The Chair: Lynn Myers.

    Mr. Lynn Myers (Waterloo—Wellington, Lib.): Mr. Chairman, I agree with what Mr. Proctor just said. It makes a lot of sense based on what you've always done in running this committee. I think, in fairness and in deference to the witnesses who are here and spent considerable time and effort to be here, we should get on with the business of the committee right now and listen to them. As is often as the case, as you have pointed out, the committee can deal with this issue at its meeting right after the witnesses. As you point out as well, if there needs to be a more full discussion, that can take place as well. I would urge us to do that. I think your thrust to move in that direction makes eminent sense.

Á  (1120)  

    The Chair: Rodger Cuzner.

    Mr. Rodger Cuzner (Bras d'Or—Cape Breton, Lib.): To add to the comments of the past two speakers and to support the advice of the chairman, I believe there is potential for protracted discussion on this, so I think, out of courtesy to our witnesses today, we should go forward with the testimony.

    The Chair: Colleagues, I can only repeat my position. I do believe, if this motion is put now, other members--I already see Jacques Saada, for example--are going to speak on it and we'll be here for some time.

    Ted, I'm in your hands. It is your motion.

    Mr. Ted White: Put the question, I think, Mr. Chair,

    The Chair: Geoff Regan.

    Mr. Geoff Regan: It seems to me that it's not appropriate for one party to try to dictate who should represent another party at this committee in these hearings. We've had witnesses from all the parties, and I don't think it is up to the Alliance to dictate who should speak on behalf of the Liberal Party of Canada.

    The Chair: Ted White.

    Mr. Ted White: With all due respect to Mr. Regan's perspective on the issue, the motion is designed to help the committee sort out a difference of opinion, apparently a very serious difference of opinion, between the president of the Liberal Party and Mr. Mercer, as an executive. I don't understand why Mr. Regan would object to the committee as a whole asking for Mr. LeDrew to come here and help us sort out why there is such a difference of opinion in the Liberal Party. That seems like a completely reasonable approach to me. It has nothing to do with the Canadian Alliance trying to drive the agenda.

    The Chair: Jacques Saada.

[Translation]

    Mr. Jacques Saada (Brossard—La Prairie, Lib.): Mr. Chairman, on two occasions, I suggested in committee that we invite the presidents of all of the political parties to appear, if the parties so desire. I made the suggestion because I felt it was critically important for political parties to be consulted. Once political parties are organized and have elected leadership to oversee the party's internal affairs and to implement the bill's provisions, logically it would be good to know what these presidents think of this bill.

    Having said this, Mr. Chairman, I won't let anyone, especially not the Canadian Alliance, use a motion like this to make political hay, My concern is for the very principle at issue, namely consultation with our elected officials. I cannot agree with this motion, Mr. Chairman, because I feel it in no way respects the spirit in which I suggested we meet with the party presidents. I did not specifically ask that we meet with Mr. LeDrew. I asked that we meet with the presidents of all political parties, should they so desire. This motion is restrictive and politically motivated and I reject it.

[English]

    The Chair: Rodger Cuzner.

    Mr. Rodger Cuzner: I appreciate Monsieur Roy's concern for the well-being of the Liberal party. When we discussed how we were going to ask witnesses to come forward, it was agreed that the leaders would be consulted and we would get representation from there. It was agreed by the committee to proceed in that way, and that's what the clerk did. I see no reason to entertain a motion as well.

    The Chair: Michel Guimond.

[Translation]

    Mr. Michel Guimond: Mr. Chairman, without saying how the Bloc Québécois intends to vote on this motion, I would nevertheless like to correct a few of Mr. Saada's statements. We're talking about witnesses testifying before a committee and I think my colleague Ted White from the Canadian Alliance was fully justified in presenting a motion asking that witnesses be called to testify.

    Again, without saying how our party intends to vote, the Member for North Vancouver is invoking a fundamental right, the right of a party and of committee members to call witnesses.

Á  (1125)  

[English]

    The Chair: I'm not disputing that at all. I know this is a very contentious issue and I know there's going to be a lot of discussion about it. In this case, as has been explained numerous times, steering committee agreed that we approach the leaders of all 13 parties. The leaders were invited to come or to send up to two delegates, which they did, and we've gone through that procedure. Following the steering committee meeting all parties submitted the names of witnesses, and the staff and I are struggling to go through those lists of witnesses. I'm not disputing this, I'm disputing the time to be taken now.

    The mover of the motion, Ted White, has something to say.

    Mr. Ted White: Having listened to the input from members here at the committee, I understand that it may be better to leave this till the end of the meeting, with a view to changing this motion to summon all the presidents of the parties, because it may well be that presidents of some of the other parties disagree with the representatives who were here last night as well. So I'm certainly willing at this stage to drop this until the end of the meeting, and we'll have a better discussion about it then.

    The Chair: I would then so rule. This is going to come up under the listed item of “Other Business”, which is future business.

    Jacques Saada, very briefly.

[Translation]

    Mr. Jacques Saada: If memory serves me well, we have a rule whereby 24 hours' notice must be given if a member plans to table a motion for consideration. Correct?

[English]

    The Chair: No, that's not the case. The motion was perfectly legitimate as posed, and I appreciate the cooperation of the Canadian Alliance in this matter.

    I would now introduce our witnesses. We regret that the Canadian Association of Broadcasters, the Canadian Bankers Association, and the Canadian Federation of Independent Business, who were invited, are not here this morning.

    We do have the Canadian Labour Congress, represented by Hassan Yussuff, the secretary-treasurer, and Murray Randall, assistant to the secretary-treasurer. We also have the Canadian Council of Chief Executives, with David Stewart-Patterson, senior vice-president, policy and communication. David, we welcome you here. With David is Alexandra Laverdure, senior policy analyst.

    As I mentioned last evening, Canadian Auto Workers is a member of the Canadian Labour Congress, and the congress has invited them here this morning and they are present. Given that we have fewer witnesses than before, I would have no objection, if the Canadian Labour Congress wishes, to inviting a representative of the CAW to the table. Are you comfortable with that, colleagues?

    Murray or Hassan, would you invite one of your colleagues forward? If you'll give us your name and title, we'll know who you are.

    Mrs. Peggy Nash (Assistant to the President, Canadian Auto Workers Union): Thank you, Mr. Chair.

    My name is Peggy Nash. I'm with the Canadian Auto Workers, and I'm assistant to the national president. I'm also an executive committee member of the Canadian Labour Congress.

    The Chair: Thank you, Peggy. In the questions and answers you can certainly be involved. If they give you time in their presentation, you can present, but it's within their time.

    Mrs. Peggy Nash: I understand that. Thank you.

    The Chair: So we'll have the CLC first, followed by the Canadian Council of Chief Executives. These will be short presentations. When we've had the presentations, we'll proceed to the questions and answers.

    Hassan.

    Mr. Hassan Yussuff (Secretary-Treasurer, Canadian Labour Congress): Thank you, Mr. Chair.

    I want to thank the committee for the opportunity for us to submit on Bill C-24 and to discuss with you some of the positions we will articulate on behalf of the committee. We submitted to the clerk our full brief for the committee to indulge in. I will focus on five main points of our brief that I hope we could have deliberations on.

    The CLC, as you know, is a national federation, with over 60 affiliates and 2.5 million members who have a stake and an interest in democratizing the Canadian political process. We believe our democratic institutions are critical to the life we live in Canada and support measures to strengthen them. Indeed, we believe unions are one of the most important democratic institutions for the well-being of average Canadians.

    All of us must acknowledge that the Canadian political system faces a democratic deficit today. There are several signs of this problem. Legislators have lost their authority to the executive. The make-up of the legislature does not reflect the voting choices of the electorate. The percentage of the public that votes has declined. We therefore welcome the major thrust of Bill C-24. It is up to the Canadian voters to determine who will represent them in Parliament. It is important that rules allow this to be done fairly. We would like to review the need for fairness in Bill C-24 under the following categories: limits on expenditures; limits on who can contribute to parties and candidates; public financing of parties and candidates; treatment of new parties; and last, but not least, limits on third parties during elections.

    Without limits on expenditures, there would be unfairness in electoral campaigns. The Canadian experience since 1979 in federal elections indicates that the absence of limits does unduly hamper political competition. Bill C-24 imposes upon the present law by including polling expenditures in the overall limit. Expenditure limits should be realistic, to lessen the chance that persons or parties may be tempted to bend the rules or even cheat on the expenditure side. On the other hand, they should not be so high that the candidates or parties are tempted to cheat on the revenue side. We believe Bill C-24 strikes a reasonable balance on this crucial point. If Parliament wants to tackle the issue of campaign costs, it should address the cost of TV advertising, as that is the single largest item in national campaign budgets. If expenditures for TV were limited in some fashion, it would reduce the cost of national campaigns significantly, and thereby also the cost of the rebate.

    Second, Bill C-24 comes close to limiting the contributions of citizens and residents of Canada. It contains a provision to allow for up to $1,000 per year to be donated to local candidates, riding associations, or nomination contests of any one party by unions, corporations, and other organizations. We believe there is a better way. As currently written, the law will be hard to administer. A large union with many locals could discover after a campaign that by accident, the total contribution of all the locals exceeded the $1,000 limit. Any one donation taken alone will be legal under the act, but if they are taken together, the law will have been broken. We might have come before you to argue that each local union should be considered as a separate entity for the purpose of having the $1,000 limit, but we are not. We believe a better solution would be to eliminate the $1,000 provision altogether.

    Bill C-24 does set an annual limit on individual contributions of $10,000 to any single party. This is a first for federal legislation. We believe the expenditure should be lowered, but an additional amount should be allowed in an election year. We will recommend that there be a limit of $3,000 per year to one party and an additional $3,000 in each election year, plus $3,000 for a national leadership campaign.

    On the issue of public financing of political candidates, we believe that is an essential part, unlike some who have criticized it as a tax grab or used other pejorative terms. One reason for corporate and union and other organization contributions is that campaigns cost money. If the latter groups are to be banned from contributing, some other source must be found. We believe, since elections are an essential part of civil society, they merit public support. Nothing prevents any individual from donating. If they do contribute, civil society reimburses them through the tax system.

Á  (1130)  

    Overall, the bill would improve the situation of national parties considerably, so that the net effect of banning donations from other individuals would be negligible or positive. All parties would have the incentive to get individuals to donate. It would also increase the incentive for individuals to give by increasing by $200 each the brackets for which tax credits for political contributions apply.

    Bill C-24 provides a 50% rebate on all expenditures by a national party, including polling. This level of compensation is now the same as at the riding level. We welcome this change as essential to facilitate the move away from organizational donations.

    We welcome the fact that Bill C-24 provides funding for parties between elections on the basis of the votes received. Some, again, have claimed that this is a tax grab. What we would prefer to see is citizens voting for a party and its candidates, but also choosing to support it financially through the tax system. There is no money assigned for those who do not vote. Whatever the amount chosen for the annual grant, we believe the rebate of $1.50 per vote should be indexed either to the overall CPI or to the basket of goods to represent what the campaigns used. The figure of $1.50 is a reasonable choice given the options we have outlined on local campaigns.

    A healthy democracy needs vibrant local organizations. We welcome the fact that Bill C-24 places local riding associations under the need to register and file annual statements. We believe it will also help ensure that local, as well as national, organizations remain viable. Currently, the national office of many parties insists that the major portion of the rebate to the riding be signed over to it to pay for the national campaign. Elections Canada has made known its objection to this practice. While we do not profess to know the exact financial needs of all parties, we will assume that assigning of the rebates is done because the money is needed by the national party. The proposed 50% national election rebate would replace donations from corporations, unions, and organizations, but it would not do so for the riding rebate revenue.

    The solution to these conflicting demands could be found in several ways. The legislation should ensure that ridings retain all or a very large portion of their rebates, or the ridings could be eligible for an annual grant based on votes received. An annual grant to the ridings that would fulfil their requirements would be open to scrutiny to ensure that it is properly used. To ensure that the national office also meets its needs, a modest increase in the rebate percentage or the annual grant level should be sufficient. We urge that this area be looked at in the context of deleting from the bill any provisions for corporations, unions, or organizations to donate money. We support Bill C-24 provisions to lower the threshold for riding rebates to 10% as another way of supporting local campaigns.

    Political systems should not be rigid and must allow new political forces and ideas to find free expression of themselves within the democratic framework. It is not an easy task to start a new national party, given the size of the country. We support the requirement that new parties should abide by the rules, that they accept money only from individuals. In addition, we insist that if they meet the threshold, they should also receive public grants that are available.

    We believe having parties register is more important than restricting the ability to receive funds. We believe the 10% threshold at the riding level is important and will benefit all parties and independents. The national threshold of 2% or 5% in the province in which the party runs is indefensible. It could be lowered.

    There is one area where we feel Bill C-24 does not go far enough. It is proposed subsection 385(1), where a party that endorses less than 50 candidates would be deregistered. We believe the requirement of 12 candidates in Bill C-9 should apply to registration of a political party. The rule of 50 allows a party to be registered if it can run candidates only in Quebec and Ontario. Why should a party that only runs candidates in all seats of B.C., Alberta, or Atlantic Canada be barred from being registered and thereby eligible for public financing? The requirement of 12 might even be lower, but it is far preferable to the 50, which clearly favours new parties in central Canada. We do hope our political system will be served by viable national parties. Some of today's national parties started as regional parties. It is important that this oppportunity is not unfairly hindered by the rules of public support.

Á  (1135)  

    We believe the solid objectives of Bill C-24 will be undermined if third party activity in support of or opposition to one of the political parties is not limited. The labour movement realizes that such limits restrict the rights for an election period. We ourselves are affected. Nevertheless, we support reasonable limits as essential to the greater democratic right to a fair election. Whether Bill C-2 is upheld or ruled unconstitutional, Canada's political system needs limits on third parties to function fairly.

    In conclusion, Mr. Chairman, we believe Bill C-24 will benefit from amendments. We suggest some. Democracy in Canada will be strengthened if it is passed into law.

    On behalf of the 2.5 million in the Canadian Labour Congress, we thank the committee.

Á  (1140)  

    The Chair: Thank you.

    David.

    Mr. David Stewart-Patterson (Senior Vice-President, Policy and Communications, Canadian Council of Chief Executives): Thank you, Mr. Chairman .

    Thank you to members from all parties for the opportunity to appear on this very important piece of legislation.

    I think it's important, because it does go to the heart of good governance in a democratic society. The business community, of course, has been engaged in some pretty deep soul searching over the last couple of years on how to improve corporate governance. We're very aware of the need to restore the faith of investors and of the public generally in the workings of financial markets. I want to suggest to you this morning that good public governance matters as well.

[Translation]

    Any public perception that corporate donations to political parties buy access or influence policy undermines public trust in both government and business.

[English]

I think this is a very important point. Any perception that corporate donations buy influence and access undermines public trust in both government and business. The rule of law, free speech, fair elections, independent judiciary, an honest and competent bureaucracy are the building blocks of democracy. They also form the foundations of a healthy economy, because they're the hallmarks of the country that can succeed in attracting people, investment, and ideas from around the world. In short, in the public and private sectors alike good governance is also a competitive advantage.

    Normally when the Canadian Council of Chief Executives appears before a parliamentary committee, we express the consensus views of our membership. I want to make it clear this morning that there is no unanimity within the business community on the issues at stake in this bill. My comments this morning are based on the responses we received to a survey of our members in January of this year, so I'm not going to be reflecting a consensus necessarily. I will simply be offering my interpretation of the balance of opinion among the CEOs who make up the council's membership.

[Translation]

    The survey responses suggest broad support for the general goals and thrust of Bill C-24. However, they also flag a couple of important issues that members of this committee may wish to consider in your deliberations on the bill's specific provisions.

[English]

    There are two principles I want to mention that received close to unanimous support from our members. The first is the critical need for transparency. Fully 90% of respondents agreed with this statement, “All contributions for a political purpose, in cash or in kind, to parties, riding associations, or leadership campaigns should be reported publicly.”

[Translation]

    This principle should be fundamental in the case of this bill. All contributions for a political purpose, in cash or in kind, to parties, riding associations or leadership campaigns, should be reported publicly.

[English]

But it shouldn't be surprising. In the corporate sector greater transparency is widely viewed as the single most important element in any strategy for improving governance. Greater transparency, however, must be begin with clear and unambiguous definitions. In this respect, I would just note something I noticed in the initial Library of Parliament analysis of the bill that was posted on the web, which said only that “contributions appear to include most donations of money as well as goods and services that are donated in kind.” There appears, in other words, to be some ambiguity on this point, and I would hope the committee wants to make sure that ambiguity is cleared up.

    The second principle that attracted close to unanimous support was that political parties should be supported primarily through voluntary donations. The support for this broad principle was reflected in the responses to some of the other specific questions we asked. In particular, by a margin of two to one, members supported expanding the federal political contribution tax credit, a provision included in Bill C-24. By a margin of more than four to one, however, they opposed in principle another measure included in the bill, the idea of replacing revenue lost from corporate donations with new subsidies based on indicators such as popular support in the previous election,. And by a similar four to one margin, they suggested that instead, parties should have to broaden their base of support within the communities of this country.

    As in corporate governance, transparency goes hand-in-hand with accountability. While comprehensive public reporting keeps everything above board, a primary reliance on voluntary donations keeps parties accountable to their members and supporters. If this bill improves transparency, but replaces corporate donations with taxpayer subsidies in a way that reduces accountability, I would suggest to you that it cannot achieve the fundamental goal, which should be to restore public trust in the institutions of our democracy.

Á  (1145)  

[Translation]

    Let me now turn to the practical reform at the heart of this bill, a restriction on the level of contributions to political parties from corporations and individuals.

[English]

By a margin of four to one, the council's members opposed both an outright ban on corporate donations and any exemption for smaller business from a general ban. By a two to one margin, though, they did support caps on both corporate and individual donations at a reasonable amount, which we defined in our survey question as between $1,000 and $10,000 a year.

    This leads me to what may be the most important question for this committee to consider. There is clearly considerable support in principle within the business community for a reasonable limit on corporate donations. The responses from our members, however, suggest that the limit imposed in Bill C-24 may be unduly restrictive. My sense is that even among business leaders who support a cap in principle, there is genuine concern that too small a limit could unfairly restrict the ability of a company even to participate in the democratic process at the riding level. For a company that operates in just a single riding the $1,000 limit may be perfectly reasonable, but for a company that operates in every riding from coast to coast it drops to a little more than $3 per riding. Since corporate donors are more likely than individuals to support more than one party, this could effectively drop the annual limit per party in each riding to less than $1. To illustrate the potential absurdity, it could become illegal for the representative of a major employer in a community to buy each of the local candidates in an election a cup of coffee, much less attend the local member of Parliament's summer barbecue.

[Translation]

    Protecting the integrity of the political process is important to rebuilding public trust in our democratic institutions. At the same time, we must not lose sight of the need to encourage people in every sector of our society to be part of the political dialogue.

[English]

I think we're all part of civil society, and we have to make sure the rules we have governing our electoral system encourage participation from every sector.

    To conclude, good governance matters in the public and private sector alike, and Bill C-24, as it stands, includes a number of important and worthwhile measures, especially those with respect to increasing transparency. But I would suggest to you that if the bill is to be as effective as possible in restoring public trust in our democratic processes and institutions, there is room for improvement. In considering any specific amendments that may be put on the table here, I would suggest that the committee might wish to give greater weight to the need for broad democratic participation in Canadian communities and the need for effective accountability.

    Thank you again to all members from all parties for the opportunity to participate in this important discussion. Of course, I stand ready to answer your questions and engage in a dialogue.

    The Chair: David, thank you for your presentation.

    We have five- or six-minute exchanges. We proceed from party to party and member to member. The questions and answers are part of the time. Sometimes, if the question is very long, I will cut you off. If it is the other way around, I will cut the member off.

    Rick Borotsik.

    Mr. Rick Borotsik: On a point of order, are the CAW not going to make a presentation?

Á  (1150)  

    The Chair: They are not going to make a presentation, because of the time. If someone would care to address a question to them, I have no doubt they could do a substantial presentation from the question. It is an umbrella organization. We have another umbrella organization here, and they could have brought all their members.

    Peggy, I hope you are not upset by that.

    Mrs. Peggy Nash: I always respect the wishes of the chair.

    The Chair: I know you do, but I hope you understand my position. Perhaps one of the members will ask you a question, and you could make your presentation then.

    Ted White.

    Mr. Ted White: Mr. Yussuff, I certainly appreciate the need to assist or encourage the development of small parties, not to have an unfair situation. Obviously, as a member of a party that came from nothing to become the official opposition in a very short time, I recognize that there are many hurdles to overcome. So we are in agreement with lowering the number of candidates, as you have suggested here, to 12. In fact, we were very supportive of Mr. Figueroa when he was fighting his case.

    With that in mind, I note that you support the riding association registration and reporting requirements. We have had other witnesses here, and it is my perception that some of the reporting requirements are rather onerous and could act as a disincentive to new candidates and new parties. I would just like to know whether you have thought about that aspect and whether that is actually a disincentive for new parties to form, because of all the reporting requirements at the riding association level.

    Mr. Hassan Yussuff: There is no question that a new party establishing itself will have to meet some stringent requirements that don't currently exist, and that is going to put some additional burden on them to conform to the legislation as it currently stands. If the rules are laid out very clearly, and again, there is an understanding that you must record, especially on the finance side, where you get your donations, who gives you whatever, it is not an impediment, because a lot of people volunteer to do this stuff anyway. The question is whether it can be done more effectively. It will put more stringent requirements than currently exist right now on most riding associations. It will certainly increase the scrutiny, but I do not think it is an undue scrutiny.

    Mr. Ted White: Elsewhere in your presentation you mentioned the $1,000 limit. You were concerned that there could accidentally be an excessive contribution. You believe a better solution would be to eliminate the $1,000 provision altogether, so I am going to ask you a question. Why do union locals even want to make political donations? What is the purpose of a union local making a political donation? Therefore, why could you not negotiate an agreement with locals simply not to make donations to political entities? That way you can create your own $1,000 elimination.

    Mr. Hassan Yussuff: I will defer to my colleague.

    Mrs. Peggy Nash: Thank you for raising that. As a union that has been a long-standing supporter of a political party and has long encouraged our members to become active in the political process, encouraging members not only to donate, but to engage in political activities, what we do and what we contribute is just a very small measure of counterbalance to the kinds of influence and donations that, for example, our colleagues on the right of the table here are able to contribute. If we unilaterally stopped participating in the political process with financial contributions and corporations continued to make their donations, the distortion that exists now in the political system would be even more skewed.

    We strongly support a situation where neither unions nor corporations are permitted to donate. Unions and corporations do not vote, citizens do, and the thrust we would like to see--and we are excited about the opportunity of this bill--is to offer a more transparent system, but offer an opportunity for people to re-engage in the political process at the grassroots level, as opposed to top-down affiliation through donations.

Á  (1155)  

    Mr. Ted White: Can I take it from your reply that you believe a corporate donation of $1,000 has influence on the political system, so a union donation of $1,000 would have influence on the political system?

    Mrs. Peggy Nash: Yes, we would argue that both would influence and aren't necessary, that both should be banned, and that because the government already is engaged in financing and supporting the political system through free TV advertising, through tax deductions for political contributions, through creating a political infrastructure through which we all participate, this is just a logical extension of its existing role in the political process and is a much healthier system than the kind of skewed system we have today, which, frankly, a lot of people think is suspect and discourages their participation.

    Mr. Ted White: Mr. Chairman, I will come back on the second round with questions to Mr. Stewart-Patterson.

    The Chair: Thank you.

    Geoff Regan.

    Mr. Geoff Regan: Thank you, Mr. Chair.

    My first question is for the Canadian Labour Congress, but first I want to make a point in relation to your presentation. I think you said the bill is unfair to unions vis-à-vis corporations, it treats corporations differently in respect of related companies. I think you'll find that in fact, the provisions that are designed for each of them mirror each other, so that related or bank branches are treated the same way as locals of unions. You can only have one donation for the group.

    We've had a suggestion that improved disclosure would be sufficient to overcome the perceived influence on government through donations. Why, in your view, is it necessary to go beyond improved disclosure?

    Mr. Hassan Yussuff: The bill envisions a number of key elements that are going to make election financing more transparent. There are a number of things seen as deficiencies in the system that are corrected. A party would receive, under the current provision, $1.50 per vote. I think these are all important elements. While we need to know who is contributing, if, as a quid pro quo, you're going to get resources from government in accordance with the number of votes you receive, we believe equally we should try to limit whatever additional influence may remain as a result of this $1,000 contribution that still remains on the books. We think it absolutely essential, in regard to disclosure, that we go one step further and restrict it.

    We could have easily come here and argued that a national union, as such, has many branches across the country and they should be treated as separate entities and all be given the same provision to make $1,000 if they so choose. We're not arguing that. We think a much more transparent, better process to get people involved in politics in this country is an outright ban on donations from unions and corporations, having a proper campaign financing mechanism that could bring more involvement of citizens in this process.

    Mr. Geoff Regan: I'll turn now to Mr. Stewart-Patterson with a similar question. We've heard from you that your organization recognizes the perception that money in politics can undermine public trust in the system, but you suggested no prohibition on donations at any level. How do you remove the perception of influence without some kind of prohibition?

    Mr. David Stewart-Patterson: What I suggested was that a majority of our members would approve of a cap on donations at a reasonable level. What is reasonable, of course, would be what the members of this committee and of this House think the Canadian public would see as sufficiently low that the amounts involved would not be perceived as influencing public policy in any improper way.

    I would disagree with my colleagues here from the Canadian Labour Congress and the autoworkers on how I think business leaders look at the donation process. With any major employer in a community, there is a strong expectation on the part of citizens that the employer will have an active role within civil society. So if the United Way holds a fund-raising dinner, a major employer is expected to be there and have a table, or maybe multiple tables. That's seen as part of what makes a democratic society work. In the same way, when a political party holds a fund-raising dinner, a major employer in town is expected to be there, no matter what party is involved. So when we talk about relatively small amounts and about donations being restricted to the riding level, there is a citizen expectation of involvement not just by the individuals who may work for a corporation, but by the entity itself, as an important part of the community. I think that's the perspective we would tend to come from. The question then, as you say, is, what is an appropriate amount?

  (1200)  

    The Chair: Michel Gauthier.

[Translation]

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

    I have one question for the two witnesses and I'd appreciate it if both of them could respond.

    We need to limit the influence that some groups or corporations have on the actions of political parties as a result of their financial contributions. This is a really big problem. The government has brought in draft legislation that would cap donations by corporations and unions at $1,000. Everyone would like to do away with this cap because it is unrealistic. If I understood what you said earlier, $1,000 wouldn't even buy each candidate in the 308 different ridings a cup of coffee -- you're probably right about that -- and independent union locals with ties to a main organization would not be able to make a donation without breaking the law.

    If the cap is eliminated, we're back to square one. That's not an option, because the problem needs to be rectified. If you can't make some relevant suggestions as to how the contributions system should be structured in the case of unions and corporations, we'll be tempted to go with the system in place in Quebec. Under Quebec law, candidates cannot accept donations from corporations, unions or businesses.

    However, that leads to other problems. People can be quite creative. For instance, 12 or 20 members of the board of a large corporation who separately could donate $10,000 each could actually donate this sum of money while in the process making it clear to the Prime Minister, to ministers or to the party leader that all members of the board of bank x or corporation y each donated the sum of $10,000 at a special meeting of the board.

    In my opinion, everyone wants to act in good faith and you need to help us come up with a solution. If you do not want us to do away completely with corporate and union donations, you need to help us find a solution that doesn't involve a total ban, but rather a specific, reasonable cap.

    The 300 or 500 branches of a major bank operating in a given region are in fact small businesses with ties to a large corporation. What alternatives would you suggest?

  (1205)  

[English]

    The Acting Chair (Mr. Ted White): I'm sorry, you're going to run out of time. If you want Mr. Stewart-Patterson to have time to answer, you need to wrap up.

    Mr. Michel Gauthier: Yes, I will have an answer, but I'll just finish my question.

[Translation]

    Surely you've given the matter some thought. Help us out here.

    Mr. David Stewart-Patterson: Perhaps we need to think about what would be reasonable at the riding level. I believe the bill is on the right track, in so far as principles go, but the question I have relates to what amount would be appropriate in terms of meeting the needs of local candidates. Most likely $1,000 per riding would be more than sufficient. However, $1 per party per riding would be too restrictive or too difficult an amount to manage.

    I don't have a particular dollar figure in mind to suggest to you. I would opt for limiting donations to riding associations, and perhaps for setting a dollar limit for each riding. The ceiling shouldn't be too high, but it should be high enough to give associations and corporations an opportunity to participate in the political and social life of the community.

[English]

    The Acting Chair (Mr. Ted White): Thank you, Mr. Stewart-Patterson.

    Mr. Saada.

[Translation]

    Mr. Jacques Saada: Mr. Chairman, my question is along the same lines as that of Mr. Gauthier's, so I think he'll have an opportunity to respond .

    Thank you very much for being here. Mr. Stewart-Patterson, you noted the following at the start of your presentation:

[English]

“there is no unanimity.... I will simply be offering my interpretation of the balance of opinion.” Welcome to our gang. It's really the essence of what we're doing around this table, having to assess a balance of opinions.

[Translation]

    I'll start with my last question, so that it follows the one asked by Mr. Gauthier. On the subject of capping donations, I have two questions.

    First off, I totally agree with the principle of imposing a cap on donations. The proposed $1,000 cap on corporate and union donations is an essential component of this bill. I totally agree that this provision should apply to donations made at the riding level. As you know, donations will be restricted to the riding level.

    How would you feel about a dual cap to address your concerns about the overly restrictive nature of this provision? For example, a cap of $1,000 could be maintained at the riding level, with overall corporate donations being capped at $5,000. Putting it another way, if the true objective here is to counter the perception of influencing policy - and I don't wish to get into that debate at this particular point in time -- and if a cap of $1,000 per candidate per riding is imposed, quite frankly, that doesn't seem excessive.

    How do you feel about this idea of imposing an overall cap on several ridings, so as to respect the spirit of the bill? My question is directed to the other witness as well.

    I have another question that I will save until later. If I run short of time, I will put it during the second round.

    Mr. David Stewart-Patterson: I believe you and I are on the same page as far as this issue is concerned. Perhaps if there was a dual cap, that is to say, a cap at the riding level, and a second overall cap, this would allow for greater flexibility in terms of participation in the democratic process.

  (1210)  

[English]

But I would come back to an underlying question: what level of participation is going to speak to the need to rebuild public trust in the democratic process? As you say, we're all in the same boat here. There are a lot of different opinions within any democratic society, it's the nature of the beast. A healthy democracy depends on divisions of opinion, and I think it is important within the context of this committee that we consider that fundamental question, what do we have to do to restore public confidence in the House of Commons as the central institution of our democracy? I know this particular bill has been discussed as a question of confidence in the government, and I would suggest to you that the real test is whether it wins the confidence of the public in the House of Commons and in the Houses of Parliament combined. I think that's really the test you have to keep in mind.

    Mr. Jacques Saada: It's not confidence in the government, but confidence in the political institution as a whole. I agree.

    Mr. David Stewart-Patterson: I think that is the ultimate test.

    The Chair: Peggy.

    Mrs. Peggy Nash: I think that question of confidence is central to the debate on this bill. Lower voter turnout demonstrates that people are increasingly disenchanted with the process in Canada and there is a sense that corporations do dominate in influence on government. Poll after poll shows that people want a more activist government that plays a greater role in social intervention, health care, and social programs. Yet what we get is the privatization, deregulation agenda business has been promoting for the last 15 years. My belief is that when you eliminate corporate and union donations, you have a much greater ability to re-establish that trust. I look at the experience of Quebec, where such contributions have been banned, and it has the highest voter turnout in the country. That says something. It hasn't prevented new parties from starting up, as the ADQ shows. It has enhanced the democratic process. So if you're looking at restoring trust in the system and more perception of democracy, I think the clear message has to be given that corporations and unions will not control the process, and those contributions should be banned.

[Translation]

    Mr. Jacques Saada: With your permission, I'd like to start by saying that a connection is often drawn between the perception of corporate influence and the level of participation in elections. However, I have many reservations about this interpretation.

    Take, for example, school boards in Quebec. School trustees are elected to these democratic institutions. A voter turnout of 15 per cent is considered nothing short of miraculous. Yet, there's no question of any money changing hands. The same holds true for municipal elections. Therefore, I would take this argument with a grain of salt, even though I'm prepared to hear it out.

    If a corporation or union can play a vital role in terms of supporting the arts, culture, sports and recreation, why then should they not be allowed to play a vital role in supporting the community through donations to the all-important political process?

[English]

    Mrs. Peggy Nash: Again, unions and companies don't vote, people do. My colleague here has talked about the role corporations play in the United Way. Labour plays that same large role in the community, with the United Way, with respect to the environment, with many other issues, and this is an important contribution on behalf of our members. But when it comes to political parties, which are about power and decisions in our society, surely the principle of one member, one vote has to be paramount, and there should be no confusion that somehow it's one dollar, one vote. I think that's the perception that gets conveyed.

    The Chair: Dick Proctor.

    Mr. Dick Proctor: Thank you, Mr. Chair.

    I want to thank the presenters this morning for very lucid insights into this issue.

    I wanted to begin on the corporate and trade union donations with the Canadian Labour Congress. It's been pointed out several times in earlier hearings that there is a difference between corporate and trade union donations, yet the proposal is to ban both of them. I think in your paper, Mr. Yussuff, you talked about the unintended consequences with the $1,000. If I understand it correctly, a board of directors of company X could meet and decide they were going to donate money to a political party or parties, but there's greater autonomy, I think, within locals of CAW affiliates or steelworkers affiliates, where they may not know that Local 6500 is giving $1,000, and they're going to, so it could end up being a problem. That seems to be what you're saying in your presentation and why you're arguing for a total ban, not because anybody is going to do anything deliberately wrong, but unintentionally, it's going to happen. Do I have it correct?

  (1215)  

    Mr. Hassan Yussuff: Yes. As you're aware, most of our locals have democratically elected leadership. They're autonomous in the sense that they operate at the local level, they get their mandate from the membership at that level, and most of the decisions they make are discussed among that membership at general meetings. If a motion was moved at a local meeting that they should participate and support the local candidate, as far as they're concerned, that's a responsibility, an obligation, and they'll do what they have to do. At the end of the day, the national unions will be legally found in violation of the legislation should they exceed the $1,000. We think it makes absolutely no sense. This legislation is really about trying to put some transparency and some integrity into the political system with political contributions. If you're going to allow the tax system to fund political parties, I think we should have the courage to say, listen, why are we messing around with $1,000, what does that do for the system? If there is recognition by national parties that $1.50 is not adequate, then look at the appropriate amount that should be there. We recommend that it should be indexed, so that it doesn't dissipate over a period of time. But we believe this is not helpful. We think an outright ban is the proper way to go.

    Mr. Dick Proctor: Thank you.

    Peggy Nash, I notice in point 4 of your elements of reform that the CAW has some very specific things to say on the participation of third parties in the electoral process. I think we all agree that if we don't have effective control on third-party advertising, any of the changes we're about to make here are not really worth a whole lot. So I'd like to get an elaboration on the CAW position on this, and if there's time, I would like to hear from David Stewart-Patterson, because he didn't talk about third-party advertising.

    Mrs. Peggy Nash: The danger in neglecting to deal with third-party contributions is that you could close the window and leave the barn door open when it comes to influence on the political process. We appreciate that it doesn't come under this particular bill, but we are expecting the federal government to vigorously defend the provisions in Bill C-2 amendments to the Elections Act. Our concern here is that while the direct contributions are dealt with in Bill C-24, there is the danger of moving more to a U.S.-style system, where you have this soft money flowing in and influencing the political process. I think the U.S. example is really the one that most clearly shows that distortion of the political process, so it is an important piece. We appreciate that this committee isn't dealing with it, but we did want to raise that point under this committee.

    Mr. David Stewart-Patterson: I didn't offer any specific observations on it. It's not part of what we expected to be included in the bill, and therefore it's not something we surveyed our members on, so I can't offer you any insight into the balance of opinion within the business community on that subject. My own background as a journalist leaves me with a bias towards a free marketplace of ideas--what keeps a democracy healthy is everybody having the opportunity to participate. I think, if people want to pool their resources to speak more loudly through mass media or other means, that ends up being healthy for democracy. But that's a personal bias.

  (1220)  

    Mr. Dick Proctor: Given your association with Thomas d'Aquino, I kind of thought that's where you might be coming from.

    Thanks very much.

    The Chair: Rodger Cuzner.

    Mr. Rodger Cuzner: It was mentioned by several witnesses last night, really throughout the course of the hearings, that there was concern about the allocation of funding just going to parties that garner 2% of the national vote. Mr. Yussuff, your group speaks at great length about the importance of not being a rigid democracy, saying we should encourage new parties. Do you have a position on the 2%? Should that be abandoned, or do you see merit in maintaining that 2% level?

    Mr. Hassan Yussuff: We think it is unfair for parties that decide to establish themselves and want to succeed. What is the New Democratic Party, what is the Canadian Alliance, earlier the Reform Party? They all started out as regional parties and subsequently became national parties. Under the current provision it would be quite restrictive for them. I think we need to recognize that the country is very different in the Atlantic regions and the prairie regions. In fairness to the democracy, if we're really looking at making this much more an effective democracy, I think it would be useful to get rid of that rule. It's there at some level right now, requiring that you need to run 50 candidates and meet this threshold to get a rebate, but if a party can run 12 candidates regionally, we can come up with a better formula. That I think would be more useful, so we're not stifling the creation of new political parties in this country.

    Mr. Rodger Cuzner: Would you care to comment as well, Peggy?

    Mrs. Peggy Nash: We support that position, and again, the example in Quebec shows that you can have controls over financing and still encourage new parties where that's what the popular will is.

    The Chair: Rick Borotsik

    Mr. Rick Borotsik: Mr. Yussuff, just clarify something for me. In your presentation you were talking about the riding rebates, the 50% for the candidates in the ridings. You suggested that the riding rebate should be contained within the riding. That would give no flexibility to parties that use it in a different fashion. Are you in fact suggesting we legislate it so that there is no flexibility, the dollars simply go back to the ridings?

    Mr. Hassan Yussuff: It has been widely suggested that backbenchers are seriously concerned whether they get any portion of these resources. With the $1.50 per vote, does the riding get any of that?

    Mr. Rick Borotsik: Don't you believe that's the internal policy of the parties themselves? You're suggesting legislation.

    Mr. Hassan Yussuff: It is internal policy, but I think there has to be some degree of comfort for people to support this legislation. Right now, as I understand it and from what I've been hearing in the media, the backbenchers are quite disturbed that they don't have any control, whatever resources might be given to the national party. Right now there is a rebate, and most riding associations have to sign that over to the national party. Elections Canada has tried to intervene on this matter. I think House leaders have been meeting to talk about how they can fix it. It is a source of contention.

    Mr. Rick Borotsik: So this is a CLC suggestion as to how we can fix this and have it passed as legislation.

    Mr. Hassan Yussuff: You don't have to accept it.

    Mr. Rick Borotsik: I understand. Thank you.

    Mr. Stewart-Patterson, part of the problem I've heard over the last number of meetings with the $1,000 corporation donation, and you've heard it today, is where there may be multiple satellites and those individuals will then give. One way perhaps of correcting that is an employer declaration. When you have different satellite operations, if there's an individual contribution made, if you simply declare who your employer is, you can match the ones throughout the country. Do you see any value in that employer declaration at all? If I were an individual making a contribution in one riding, but I had a parent company that had other employees making contributions in other ridings throughout the country, if there was an employer declaration as to who I worked for, there could be perhaps a check and balance.

  (1225)  

    Mr. David Stewart-Patterson: You may be crossing over two types of donations.

    Mr. Rick Borotsik: Absolutely. That's the concern, though.

    Mr. David Stewart-Patterson: Most individuals who are making donations work somewhere.

    Mr. Rick Borotsik: I understand that, but part of the concern is when you have the Royal Bank with multiple branches throughout the country, if every branch gave $1,000, I know it would never happen with that particular employer, but there could be a direction. All I'm saying is, if there was a $1,000 donation by every manager of every bank branch and you had a declaration there of an employer, it would be easy to backstop that.

    Mr. David Stewart-Patterson: But it seems to me that it's far more practical to simply control that through a corporate internal budgeting process, if it's a corporate donation coming out of a corporate budget line, as opposed to a personal donation that has to be collected because of an association with who you work for. That's why I'm a little confused on what you're trying to get at here.

    Mr. Rick Borotsik: There are some problems here with the difficulty of trying to find out who is donating on whose behalf, the corporation or the employee.

    Mr. David Stewart-Patterson: My reading of the bill was pretty clear on that front, that companies cannot require and cannot reimburse employees--

    Mr. Rick Borotsik: Absolutely not, that's very clear.

    Mr. David Stewart-Patterson: If it's personal, it's personal, if it's corporate, it's corporate, and if it's corporate, there's going to be a budget item and you can manage that, whether you're a local company, a regional company, a provincial one, or a national one.

    Mr. Rick Borotsik: But the concern is that perhaps that would be a direction and would not be a controllable corporate donation. Anyway, you don't agree with any kind of employer declaration for a personal contribution.

    Mr. David Stewart-Patterson: It just sounds as if it would create more confusion than it would possibly resolve, based on what I'm hearing.

    Mr. Rick Borotsik: The other option I've heard is just to get rid of the corporate limit altogether, and I'm not supportive of that.

    Mr. Yussuff, you have asked to drop the party registration requirement down to 12 ridings, as opposed to 50. You came with quite a good rationale with respect to the regional element. We're supposed to be talking national parties, but we recognize that we've gone into some sort of regionalized politics. Would 35 be reasonable, as opposed to 12?

    Mr. Hassan Yussuff: We only used that number because we did a lot of soul searching, especially for the Atlantic regions of this country.

    Mr. Rick Borotsik: Add them up, it's 35.

    Mr. Hassan Yussuff: Yes, if you combine them all, but if you were doing it in one province, if they wanted to start out there--

    Mr. Rick Borotsik: If you want to go to P.E.I., it's four.

    Mr. Hassan Yussuff: We gave it as a suggestion, it's not a perfect solution, but we think it's a worthwhile one in looking at the country in a very honest way.

    Mr. Rick Borotsik: You talk about transparency, you talk about accountability. Do you think, Mr. Stewart-Patterson, this legislation put before you will in fact achieve that transparency and accountability and not leave the ability for some abuse, both corporate and union?

    Mr. David Stewart-Patterson: As I've said this morning, the bill as it stands will improve the situation, but I think there's still room to improve the bill as well.

    Mr. Hassan Yussuff: A ban on union and corporation contributions will make it even more transparent.

    The Chair: Ted.

    Mr. Ted White: Thank you, Mr. Chairman.

    So that the reason for asking this question is not misinterpreted, I want to put on the record that the Canadian Alliance is opposed to this bill, because we don't believe we should be taking public money, we believe we should be raising the money from the people we claim to represent. I'd like to ask you a question about the limits. You used an absurdity to illustrate the point that a corporation could easily exceed the limit by giving one cup of coffee to someone at a summer barbecue, but wouldn't that argument apply to any limit, no matter how high it is? It's like the straw that breaks the camel's back: there would always be that last cup of coffee at the last summer barbecue that exceeded a $10,000 limit or a $100,000 limit. So I'm going to put the same proposal to you as I did to the union representatives. Why not just encourage a climate where corporations simply don't make these donations. What's the purpose of making them in the first place?

  (1230)  

    Mr. David Stewart-Patterson: The answer to your last question comes back to something I said earlier: what is the public expectation of employers in a community? If we're expected to take part, as Mr. Saada suggested. in every other aspect, social, cultural, artistic, sports, whatever, is there an expectation that we should at least be there participating as representatives of an employer, rather than as individuals? My sense is that there is an expectation that employers should be there, and that's healthy for the democratic process. As you say, I reduced the $1,000 limit to the level of absurdity, but my intention here is to suggest to you that there is room for some modest amount that takes care of the cups of coffee and the summer barbecues without getting into the question of large cheques appearing to buy influence. As I say, I don't have any magic number to offer you, but I am suggesting that there is a happy medium there somewhere.

    Mr. Ted White: I would just like to sneak in a quick one to Peggy Nash. In your presentation under “Reforming the System” you mention the amount of money that was collected during the last federal election by the Liberals and the Canadian Alliance, making it $7 million for us there. I'm not sure if you realize it, but the Canadian Alliance raises almost all of its money from individuals, not from corporations at all. It's true that the Liberal Party raises quite a percentage of its funds from corporations. The argument throughout your document is that you want people to be involved in the political process, and within the Canadian Alliance, and within the NDP, which is the party your union most likely supports, there is a tremendous ability to raise small amounts from lots of individuals. So why would you support moving to a system paid for by taxpayers when the party you support has already demonstrated its ability to raise money from individuals? Why get the taxpayers involved at all?

    Mrs. Peggy Nash: Because I think the system you have today is so skewed towards top-down donations, especially corporate donations, that to just say, we're cutting off all political funding, without the corresponding rise in individual donations, is to stymie the political process. Political parties must have money to function. We live today in an age, unfortunately, of a little too much advertising. Probably election costs could be reduced dramatically if there was a limit on TV advertising, for example, and more free public advertising through the TV system. As I said earlier, government is already involved in elections in a number of important ways, and what this does is take out the influence of entities and require a base of public support for political parties.

    However, in addition to that, I would absolutely agree with you, the goal should be encouraging more individual support. Nonetheless, I think the $10,000 individual limit being proposed here is far too high. There are a lot of people who make maybe three times that amount in a whole year, so to say $10,000 is the individual limit skews that kind of donation towards people at a higher income level, but I think the trend should be toward individual participation, and that's a much healthier system.

    The Chair: Dick Proctor.

    Mr. Dick Proctor: Thanks, Mr. Chair.

    Mr. Borotsik was asking Mr. Yussuff about the signing over of rebates to local riding associations and whether that should be permitted or not. I believe you will find that Jean-Pierre Kingsley, the Chief Electoral Officer, said within the last two months henceforth he will not agree to sign local riding association rebates over to national parties, they will go to the local riding associations. I just wanted to make sure that was widely understood.

  (1235)  

    The Chair: Thank you, that will be noted.

    Colleagues, on your behalf, I want to thank our witnesses. Thank you very much indeed.

    I'm going to suspend in a moment. We will resume our meeting considering the item of future business, particularly the motion, in two or three minutes.

  (1235)  

---

  (1238)  

    Mr. Ted White: Thank you, Mr. Chairman.

    I'm not quite sure what process I should follow here, but I've actually amended my motion. I don't know whether I should withdraw the first one and submit a new one.

    The Chair: Ted's amended his motion. He must have unanimous consent to withdraw the first motion. Agreed? Okay, the motion is out.

    Would you read the amended motion?

  (1240)  

    Mr. Ted White: I came here in good faith because I noticed a conflict between potential witnesses, and I thought we could solve that by the motion I brought forward. I've modified the motion to take into account comments made by government members. So the motion now reads: “That this committee summon the presidents of the parties with seats in the House to appear before it and give evidence regarding Bill C-24, an Act to amend the Canada Elections Act and the Income Tax Act.” The reason for making the changes is that there could be some disagreement between the presidents of the other major parties also and people who appeared here.

    The Chair: Jacques Saada.

[Translation]

    Mr. Jacques Saada: Mr. Chairman, when the steering committee proposed a list of potential witnesses to the main committee, we didn't need a motion to approve the list. Today's motion specifically called for a vote on this question. Consequently, it wasn't a question of finding out if party presidents or Mr. LeDrew in particular had something to say, but of proposing a specific political initiative, one that I am rejecting. Mr. White uses the word “summoned” in his motion and that's pretty strong wording.

    Under the circumstances, I'd like to move a motion that, if I understand correctly, would supercede Mr. White's motion. Specifically I move that we adjourn debate on the motion.

[English]

    The Chair: Jacques, your motion is to adjourn the debate on this motion. There's no debate on that, I have to put that question immediately.

    Mr. John Reynolds: I'd like that vote recorded, Mr. Chairman.

[Translation]

    Mr. Michel Guimond: I don't understand why the Liberals are afraid of debating the issues.

[English]

    The Chair: Okay.

    (Motion agreed to: yeas 8; nays 7)

    Mr. Dale Johnston (Wetaskiwin, Canadian Alliance): On a point of order, I wonder, Mr. Chair, if you could confirm for me that all the Liberals are duly substituted.

    The Chair: Yes, they are.

    Should we now move in camera, as we normally do for planning purposes?

    [Proceedings continue in camera]