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Canada  

Political parties get richer

Reforms aimed at ending the influence of big money on the federal political process have resulted in parties raking in more than 10 times as much dough.

But a lot less of it is coming from wealthy individuals.

Those are the findings of an Elections Canada analysis of financial trends for political parties between 2000 and 2014.

The reforms went into effect in 2004, capping annual donations from individuals at $5,000 and severely restricting contributions from corporations and labour unions.

Further reforms in 2007 capped individual donations at $1,000 (adjusted annually for inflation) and prohibited corporate and union contributions altogether.

Despite the reforms, Elections Canada found that the net assets of political parties and their riding associations grew from $7.8 million in 2004 to a whopping $81.7 million in 2014.

However, since 2006, just one per cent of the money collected by parties has come from a tiny percentage of individuals (less than one per cent of all contributors) who could afford to donate more than $1,200.

Prior to the reforms in 2004, more than half (54 per cent) of the money raked in by parties came from donors who gave more than $1,200, even though they accounted for only two per cent of all contributors.

The huge increase in parties' net assets since 2004 includes the public per-vote subsidy given to parties as a way to compensate them for the restrictions on donations. The previous Conservative government phased out that subsidy, scrapping it entirely last spring, while increasing the individual donation cap to $1,500.

However, the subsidy does not entirely account for the improvement in parties' finances.

The analysis found that total donations to parties from 2012-14 were 13 per cent higher on average than in 2001-03. Even small parties that were not eligible for the subsidy improved their financial situation following the reforms, although the cash gap between them and the bigger parties increased.

In non-election years since 2004, the agency says annual contributions to parties have increased by an average of seven per cent, despite the restrictions on donations.

In election years, however, donations have actually declined by more than 40 per cent compared to the $125 million parties raked in during 2000, the last election year in which there was no limit on donations.



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