Alberta Wants to Loosen Restrictions on Corporate Financing of Elections

It may soon be easier for big money to influence government policy in Alberta.

Through a series of proposed legislative amendments, Danielle Smith’s United Conservative Party plans to open the door to increased political influence by corporations.

Introduced the day after the federal election, Bill 54, the Election Statutes Amendment Act, promises major changes to political financing in the province, which has raised concerns from government-accountability advocates.

Among the changes, corporate entities and unions would be permitted to make up to $5,000 in annual contributions to parties and candidates; currently, donations can only come from individuals.

Some observers say this would further entrench the outsized influence from deep-pocketed individuals and business owners in a system that was already too easy to game.

Ricardo Acuña, executive director of the University of Alberta-based Parkland Institute, says Bill 54 would bring corporate interests closer to political power.

Noting instances where multiple corporate entities are owned by one individual, Acuña warned of potential cases where a single person could have “their hands in a number of different registered companies, registered as anonymous numbered corporations.”

“They suddenly have three or four different entities from which they can make the maximum donation, in addition to also making the maximum donation themself. This opens the door to all kinds of creative ways of bypassing the maximum.”

Multiple previous investigations by PressProgress have identified this phenomenon in the past, in particular with third-party advertisers (TPAs), groups that carry out political campaigns to promote parties, particularly during elections, while not officially being tied to a party themselves.

The bill tabled Tuesday by Justice Minister Mickey Amery proposes significant changes to rules surrounding TPAs as well. While the maximum permitted donation to a third party would drop from $34,400 to $5,000, the maximum spending permitted by such groups would more than double, from $186,000 to $500,000.

Acuña says the decreased limit on individual and corporate donations to TPAs would do little to stop contributors from routing larger sums through multiple entities and individuals.

According to Democracy Watch director Duff Conacher, the drop in maximum TPA donations would be a relatively superficial change in a framework in which donation limits remain high.

“The limit of 5,000 is much higher than an average person can afford, and is essentially, when it comes to donation limits, a system of legalized bribery,” Conacher told PressProgress.

With the amendments, Alberta would join a small club of jurisdictions in the country that allow direct corporate donations to political parties, with the others being Saskatchewan, Newfoundland and Labrador and the Yukon.

However, Conacher says the problem couldn’t be solved with limits on corporate donations alone. Pointing to recent research, his group, Democracy Watch, has advocated for far stricter limits on all political donations across Canada.

“When you have a $5,000 donation limit but a ban on corporate and union donations, what we’ve seen across the country is that their executives and kids start giving the maximum amount and they end up giving a lot of money to the party, and it actually makes it harder to track because the spouse may have a different last name than the executive of the business, the kids may have different last names,” Conacher said, adding that average donations from working-class Canadians are closer to $75.

Quebec currently sets donation limits at $100, with strict penalties for non-compliance. With contributions exceeding $50, donors are required to prove to Élections Québec that the money donated is their own.

“Why did they go that far? It’s to prevent someone from walking into a party headquarters with a hundred checks saying, ‘This is 100 cheques for $100 from my employees. They all gave it voluntarily,’” Conacher says.

”We found with banning corporations while leaving a high donation limit, all it did was obscure big money, it didn’t stop it. The only way to stop big money is to stop big-money donations, and $5,000 is more than most voters spend.”

Bradley Lafortune, executive director of the accountability watchdog organization Public Interest Alberta, also sees the recent change as an acceleration of corporate influence in politics.

“It’s a further step toward pay-to-play politics, where the deepest pockets will determine outcomes of elections. What should be happening is big conversations about how we engage in elections much more ethically. Should we have political donations that exclude participation from working people, and what kind of donation limits are appropriate, considering the median household incomes in Alberta?” Lafortune told PressProgress.

“And then it’s a short jump to having conversations about funding elections so that parties don’t rely on donations.”

Lafortune says PIA has promoted a different approach to party and election finance altogether.

“Our democracy task force has advocated for publicly funded elections, so that people have a budget to advocate their platforms to voters. Voters participate by voting, and you take money out of the equation.”