Chrétien urges Harper not to kill party subsidy

Prime Minister Stephen Harper should reconsider his vow to end the direct per-vote subsidy for political parties, says former prime minister Jean Chrétien, the architect of the current system.

Chretien speaks out

10 years ago
Former Prime Minister Jean Chretien comments on the future of the Liberal Party, and urges the Harper government not to end public subsidies for political parties. 5:38

Prime Minister Stephen Harper should reconsider his vow to end the direct per-vote subsidy for political parties, says former prime minister Jean Chrétien, the architect of the current system.

Harper tried to kill the $2 per vote subsidy in 2008, sparking a rebellion by the opposition parties that nearly cost him his minority government. During the just-concluded election campaign, Harper said a majority Conservative government would phase out the system over two to three years in consultation with the other parties.

"I think [Harper] should reflect on that. The system is working very well," Chrétien told reporters in Quebec City Monday.

Chrétien noted that in his last election, in 2000, the Liberals spent only about two-thirds of the money that Hillary Clinton did to win her U.S. Senate seat.

"So, you know, it means that money in Canadian politics is less important than elsewhere, a lot less important," Chrétien said. "The parties receive it if they are serious, they receive a subsidy from the state. But they don't become prisoners of raising the money."

Subsidy came with ban on corporate donations

Former prime minister Jean Chrétien addresses a Liberal campaign rally in Toronto on April 27, 2011. (Paul Chiasson/Canadian Press)
The Chrétien government created the per-vote direct subsidy in 2004, when it banned corporate donations to parties and limited contributions to ridings or candidates to $1,000 per year. Individual donations were capped at $1,000 per party and $5,000 total, down from $10,000.

In 2006, the new Harper government dropped the individual limit to $1,000 (adjusted to inflation; it was $1,100 in 2010 and will be $1,200 in 2011) and imposed a complete ban on donations from corporations, unions and organizations. Donations to political parties are eligible for up to a 75 per cent rebate.

A spokeswoman for Prime Minister Stephen Harper says killing the subsidy is a platform promise the government intends to fulfill, but they haven't yet decided when to start the process.

"We'll take things one step at a time. It remains a priority and it's in our platform. We will be fulfilling that commitment," Sara MacIntyre said.

Harper and other government officials have said passing the 2011 federal budget is their first priority, followed by legislation that will set into law the anti-crime bills the Conservatives weren't able to pass as a minority government.

In response to a reporter's question, Chrétien said that an end to the direct subsidy will hurt some parties more than others.

"Those [parties] who are closer to the poor people, there's less money to raise among the ... poorer people than the rich people, don't you think? And that will be perhaps, you know, handicapping some element of politics," he said.

"I did not invent the system, the system ... was here in Quebec and after that, it was adopted by Manitoba and after that, I decided to do the same thing for the federal government and I was very proud of it."

"It's a system that is functioning well, you know... but if [Harper] does it for ideological reasons, he will have to explain it," Chrétien said.

Harper argued during the election campaign that political parties already enjoy tax advantages and taxpayers should not financially support political parties that they don't support with their votes.

"I've wanted to change this. But we were very clear: unless we have a majority government we will never attempt to change it because we know in a minority government you can never move this forward," Harper said in early April.

Canadian Heritage Minister James Moore, in an interview with CBC Radio's Kathleen Petty on election night, confirmed the Conservatives' plan to move ahead with ending the subsidy.

"I think taxpayers shouldn't be subsidising political parties and that's the commitment that we've made," Moore said.

Conservatives strong fundraisers

The Conservative Party is by far the strongest fundraiser among Canada's parties. The party consistently raises the most money and has the largest base of contributors, where the Liberal Party has struggled in the past.

In the first quarter of 2011, for example, as the parties prepared to head into an election, the Conservatives raised $7.4 million from 50,478 donors, according to Elections Canada. That's more than double the number of donors of either the Liberals or NDP. The Liberals raised $2.65 million from 22,245 contributors, while the NDP raised $1.9 million from 17,492 people.

The Green Party raised $413,757 from 4,122 donors, while the Bloc Québécois hit $192,644 from 1,858 contributors.

The Liberals, however, were much more successful than usual during the recent election campaign. Party officials say they raised $4 million, more than they did during the last three elections combined.

The subsidy has been lucrative for all the major parties, but particularly for the opposition. The total 2010 allowance for the Bloc, for example, was four times more than the party raised that year through donations. The Greens got a $600,000 boost from the subsidy to its fundraised $1.3 million.

The Liberals raised $6.6 million in 2010 but got $7.3 million from the subsidy, while the NDP raised $4.4 million in donations and got $5 million from the allowance. The governing Conservatives made $10.4 million from the subsidy to add to the $17.4 million they fundraised.