Pros and cons to boosting funding for political parties

Hey there, time traveller!
This article was published 11/05/2024 (766 days ago), so information in it may no longer be current.

Earlier this week, Premier Wab Kinew’s provincial government introduced a wide-ranging omnibus bill that included, among many other aspects, more generous funding for parties and candidates running for public office.

The proposed Election Financing and Amendment Act boosts the maximum reimbursement of election expenses from 25 to 50 per cent. If the bill passes — and every expectation is it will — then both parties and candidates would have half of most the expenses of running for office reimbursed by the government. While the rebate had previously been pegged at 50 per cent, former premier Brian Pallister slashed it to 25 per cent upon winning office.

Rebates of election expenses are a common way for governments to help out political parties and candidates. In federal politics, for example, Elections Canada limits the amounts that parties and candidates can spend when running for office. But if they follow the rules, candidates will have 60 per cent of their election, travel and living expenses reimbursed by the taxpayer. Federal parties are eligible for a 50 per cent rebate.

Tellingly, candidates for federal office can receive a 90 per cent rebate for child-care expenses incurred during an election campaign. The idea is that campaigning is hard work and it’s a little challenging to cart your kids around with you everywhere when spending all day knocking on doors, so some form of child care is needed, lest only non-parents ever run for public office.

Rebates are not the only way that the state financially supports those who run for office. Political contribution tax credits covered by the government can make it far easier for party supporters to crack open their wallets. In Canada, you can claim the credit for 75 per cent of your first $400 contribution, 50 per cent of any contribution between $450 and $750, and 33.33 per cent for any amounts over $750. This generous subsidy of private contributions can make donating to parties much more affordable, and politicians ensure their supporters know it.

The state can also directly fund parties, providing a regular payment that allows the parties to simply forget about fundraising. The amount of these state subventions is typically based on the performance of the parties in past elections.

Canada had such a system of per-vote subsidies in place between 2004 and 2015. The subsidy was created in part to compensate parties for the loss of contributions from corporations and unions, which were banned in 2004. Like most other democracies with such subsidies, Canada’s system paid parties based on the number of votes they received in the last election. In 2004 (the first year of the subsidy), the Bloc Québécois, Conservatives, Greens, Liberals and NDP scored a total of just over $23 million in direct subsidies.

Annoyingly, over the life of the per-vote subsidy, the separatist Bloc Québécois pocketed more than $25 million in direct funding. The Bloc then used that money to advocate for the breakup of the country that was financially keeping them afloat.

Only in Canada.

There are good reasons why the state should provide some financial support for both parties and those that run for office. The most important is to ensure that there is something approaching a level playing field for those hoping to run. With no subsidies (or, worse, no limits on the amount candidates can spend), many people who would otherwise put their names forward to run would find the costs of doing so prohibitive.

Politics should not only be for the well-to-do. We need more working-class and low-income Canadians to bring their perspectives and voices to elected office. Generous reimbursement of election expenses is one way to help achieve this.

We also want Canadians to engage with and contribute to parties, and for politicians to feel accountable to those that contribute. The contribution tax credit helps Canadians to do so.

At the same time, overly generous state support can create a disconnect between parties and their supporters, and insulate politicians from growing resentment in society. In many democracies with per-vote subsidies, parties form what political scientists call a cartel, which in turn fiercely protects its new source of income.

These parties have adapted their organizations from ones that must be responsive to supporters in order to raise money, to rather more elite, luxurious organizations that know their taxpayer-funded quarterly cheques will arrive on schedule, rain or shine.

It’s crucial to seek balance in questions of financial support of parties and candidates. My own view is the government’s proposed 50 per cent reimbursement of candidates is perfectly reasonable, and that a higher rate (like the federal one) could be considered. While conservatives have historically opposed generous reimbursement, the recent increasing popularity of federal and provincial conservative parties with working-class Canadians may help persuade Tories that it is in their interest to rethink this opposition.

» Royce Koop is a professor of political studies at the University of Manitoba and academic director of the Centre for Social Science Research and Policy. This column was originally published in the Winnipeg Free Press.