[Democracy Watch Logo] [Op-ed]

Per-vote subsidy should be made more democratic, not cut
Other democratizing changes also needed to political finance system

Set out below is an op-ed by Democracy Watch Coordinator Duff Conacher which was published in the May 30, 2011 edition of the Hill Times
and in shorter, letter form in the May 30, 2011 edition of the Saskatoon StarPhoenix

The $2 per-vote annual subsidy for political parties is the most democratic part of the federal political finance system, so while it should be changed to make it more democratic it would be very undemocratic to cut it to zero as the Conservatives promised to do in their 2011 election platform.


Removing the subsidy would be yet another undemocratic move by Prime Minister Harper's Conservatives, who have decreased the level of integrity and democracy in the federal government since 2008, according to Global Integrity's 2010 Report.


Because it is based on the fundamental democratic principle of one-person, one-vote, the per-vote subsidy is inherently democratic -- in fact it is the most democratic part of the federal political finance subsidy system. 


It also has the democratic benefit of encouraging voters to turn up to cast a vote so that the party they support receives the $2 annually (despite the Conservatives’ oft-repeated false claim, no one's tax dollars support any party other than the one they vote for, as all voters pay at least $2 in tax each year).


In contrast, every election our flawed voting system election has the undemocratic effect of giving a higher percentage of MPs in the House of Commons to some parties than they deserve in terms of the percentage of voter support they receive.  This causes the largest, undemocratic annual subsidy of some federal parties, and takes tax dollars from some voters and gives them to parties they don't support.


For example, the Conservatives received 24 MPs more than they deserved in the recent election (they received 39.6 percent of the vote, but 54 percent of the MPs).  Each of those MPs receives $440,000 annually in salary and for their offices, so the Conservatives will receive a large, undemocratic subsidy of $10.5 million every year until the next election (the largest such subsidy of any party -- the NDP was the only other party that received a higher percentage of MPs than votes).


A fair, democratic move would be to cut the per-vote subsidy to any party that receives more MPs than it deserves, while keeping it for parties that receive fewer seats than they deserve in the election (or, even better, reform the voting system so that parties receive the exact number of MPs they deserve based on their voter support percentage).


At the same time, the per-vote subsidy was set at too high a level in 2003 by then-Prime Minister Jean Chretien, as it was calculated to replace the annual corporate donations the Liberals received at that time.  Cutting the subsidy in half to $1 per vote for the parties that would still receive it would be a democratic incentive because it would force these parties to reach out to more voters in order to prosper financially.


The subsidy should also be cut even more for regional parties that do not operate nationally, such as the Bloc Quebecois, simply because they have lower operating costs than parties with riding associations across the country.


It is not yet known exactly what they will do, but if Prime Minister Harper's Conservatives make the undemocratic move of cutting the per-vote subsidy to zero, it will not kill or bankrupt the Liberals or any other party.


Nor, as a couple of people claim, is there any need to increase the individual donation limit to help the parties that lost votes in the most recent election (again, even if the per-vote subsidy is cut to zero).  In fact, the limit should be lowered.


First, all the parties raise money through donations -- the Liberals raised about $6.6 million in 2010, the Greens $1.3 million, and the Bloc $642,000.  So they will continue to survive by raising this money, and likely will raise more from sympathetic and supportive donors if the per-vote subsidy is removed.


Second, the average annual donation to each party is between $100 and $240 per individual donor, but the individual donation limit is $2,200 annually ($1,100 to each party, another $1,100 combined total to the riding associations of each party), and $3,300 during an election year (an additional $1,100 donation is allowed as a combined total to the candidates of each party).


So all these parties have plenty of room to try to move their donors up closer to the donation limit, or to appeal to new wealthy donors to donate the maximum.


Increasing the donation limit would increase the possibility of the best government money can buy, instead of a more democratic government. 


Scientific, peer-reviewed research (led by American Robert Cialdini) has shown that even small gifts and favours have influence over decision-makers because they feel obligated to return the favour.  Allowing larger donations will only increase the influence of wealthy donors, in violation of the democratic principle of one-person, one-vote (a principle that, in any country calling itself a democracy, should be upheld in every way, every day so that no one person is allowed to have more influence than any other person over any political decision-maker).


Already the current donation limit is a much higher amount than the average Canadian can afford to donate, given that the average annual income in Canada is $35,000-$40,000.  So a democratic move would be to cut the donation limit in half.

As well, the average annual individual donation to each federal party is between $100 and $240, so the current 75% tax deduction for the first $400 donated should be changed to apply only to the first $250 donated.  The overall 50% deduction for larger donations should also be decreased to 17% because only wealthy people who can afford such large donations benefit from it, and it is currently another major way in which money from voters is taken to benefit parties they don’t support.


So, the new Conservative majority government has a few choices -- keep their election promise and cut the per-vote subsidy which will make the political finance system more undemocratic (and will hurt some parties more than it will hurt the Conservatives).  Possibly also increase the donation limit which will be doubly undemocratic as it will allow wealthy donors to have more influence over parties and MPs.


Or the Conservatives can make the fair, democratic moves of changing the per-vote subsidy in democratizing ways, and lowering the individual donation limit to a level that an average Canadian can afford, and the tax deductions to levels that do not subsidize wealthy Canadians so much.


Which will it be Prime Minister Harper?  Less democracy for Canada (continuing the downward slide you have caused since 2008), or more democracy (by democratizing to the political finance system, and even better by finally keeping the 30 democratic promises you made in 2006 that you have not yet kept).


Which will it be?

And federal opposition parties, will you take every possible step, including proposing democratizing amendments and filibustering at every stage of the bill’s review, to delay the implementation of the cutting of the per-vote subsidy until every voter in Canada is made aware of it?

For more details, go to Democracy Watch's Money in Politics Campaign page