Stephen Harper’s Progressive Conservative government is set to scrap the per-vote subsidy. The subsidy, instituted by the Chrétien Liberals as a concomitant to their proscription on corporate and union donations to political parties, allocates federal parties about $2 per year for every vote they won in the last election.
The subsidy, according to Harper, is responsible for the frequent elections with which he has been plagued. The other political parties, it seems, remain viable on the strength of their popular support “whether they raise any money or not.” “The war chests are always full for another campaign,” Harper opines. “You lose one [election]; [and]immediately in come the [per-vote subsidy] cheques and you are ready for another one, even if you didn’t raise a dime.” Whats more, the subsidy is manifestly unjust, he assures us, because: “Taxpayers shouldn’t have to support political parties that they don’t support” through public funding.
What Harper shrewdly forgets to mention amid such righteous pronouncements, is the other type of public subsidy which political parties receive — a subsidy which overwhelmingly benefits the Conservative Party — and which he does not plan on eliminating. When a private citizen makes a donation to a Canadian political party, he or she receives a tax credit refunding up to 75 per cent of his or her donation, $650 is returned on the max donation of $1275. That means that when a conservative voter donates, say, $400 to Harper’s party, the PC gets the full $400 but the donor only pays $100 — the other $300 is paid for by the general tax pool. Unlike the per-vote subsidy, which awards money in proportion to popular support, this subsidy awards public money based upon how wealthy, and hence how capable of donating, each parties’ supporters are.
If Harper really believed that “Taxpayers shouldn’t have to support political parties that they don’t support” then he would eliminate the tax refund (which forces taxpayers of all political affiliations to subsidize individual donations) and leave the per-vote subsidy, which provides $2 for every voter who shows support for a given party by voting for it. Such a move is inconceivable, however, as the Conservatives, having the wealthiest constituents, receive far more private donations (and thus get more ‘support from tax-payers who don’t support it’) than the Liberals and NDP combined.
By eliminating the per-vote subsidy Harper is not acting on any principle; he is strategically removing a specific type of public funding (one which benefits all parties equally and democratically) while leaving in place another type of public funding (one which privileges parties with wealthy supporters — his most of all.)
As the PC’s fundraising website proudly states, “The Conservative Party of Canada is a Registered Political Party and your contribution in any one year may entitle you to generous political tax credits on your next tax return.” For the wealthy, this is true. They can give up to $1275 to the Conservative Party (which provides them, and the corporations they manage, lucrative tax-cuts) while actually paying only $625 the rest being publicly subsidized. The refund, however, does not come until next year’s tax-return, so it is basically unavailable to the majority of Canadian workers who live pay-cheque to pay-cheque, although their tax-dollars still subsidize the political donations of the wealthy.
Eliminating the per-vote subsidy will not strengthen Canadian democracy but will make the support of wealthy individuals even more important than it already is and devalue the political power of the poor even further. The result is not hard to predict. Policy will be catered to the wealthy, with little regard for the poor — that means corporate tax-cuts paid for by service cuts.
A better way to reform Canada’s party-finance system would be to eliminate the tax-refund that forces the general public to pay more than 50 per cent of any donation made by a given individual — or, better yet, eliminate private donations altogether — and increase the per-vote subsidy to make up the difference. This would make the ability of political parties to campaign effectively commensurate with their numerical support, not the wealth of their constituents.
