Impoverishment of municipal political parties – The Chief Electoral Officer reiterates its recommendation for a new permanent municipal financing system

June 4, 2015

Based on financial information showing that Québec’s municipal political parties continued to grow poorer in 2014, the Chief Electoral Officer of Québec reiterates its recommendation for a new permanent municipal financing system. Today the office of the Chief Electoral Officer of Québec published a document entitled Portrait sur le financement des partis politiques municipaux (portrait of the financing of municipal political parties) for the fiscal year that ended on December 31, 2014.Overall, in Québec, the municipal political parties’ assets fell by 20.4% and their liabilities increased by 59.2%. This has resulted in a decrease in net assets of 149.8%. On December 31, 2014, some 31 of the 142 authorized parties had accumulated deficits. In the past year, moreover, a number of municipal political parties asked the Chief Electoral Officer of Québec to withdraw their authorization in order to put an end to their activities due to an overly difficult financial situation.

In the review of the political financing reforms he filed last September, the Chief Electoral Officer underlined "the overall deterioration of the financial situation of municipal political parties and an increase in debt levels." In this report, recalls the Chief Electoral Officer, Ms. Lucie Fiset, "our institution recommended to the Minister of Municipal Affairs and Land Occupancy legislative changes to the Act respecting elections and referendums in municipalities (AERM) in order to establish a permanent regime on municipal political financing, based on the one that exists at the provincial level".

It will be recalled that in June 2013, in the context of the municipal general elections which took place in November of that year, the National Assembly adopted a temporary financing system for municipal political parties and authorized independent candidates. This reform lowered the maximum allowed contribution from $1,000 to $300, which deprived parties and candidates of significant resources. To compensate for this decrease in revenue, the main measure consisted of increasing the reimbursement of election expenses for eligible candidates from 50 to 70 percent. The Chief Electoral Officer of Québec considers that an increase in public financing of parties and candidates is the logical next step for the financing system. The data published today by the Chief Electoral Officer tend to confirm the relevance of the amendments proposed to the AERM, which aim to ensure the sustainability of municipal political parties.

Portrait of the financing of municipal political parties in 2014

A total of 178 municipal political parties were authorized at one time or another in Québec in 2014. During that year, 32 parties asked that their authorization be withdrawn, 2 political parties lost it as a result of a decision by the Chief Electoral Officer of Québec, and 2 other parties merged, thus creating a new party. Two new municipal political parties emerged last year. Almost half of the municipal political parties, i.e. 86 out of 178, are found in smaller municipalities, i.e. those with between 5,000 and 20,000 inhabitants.

When it comes to financing, we must first of all underline the special situation in Montreal and Quebec City, the only places where political parties receive allowances from the municipality which are similar to those paid to the provincial political parties by the Chief Electoral Officer of Québec. These allowances amounted to over $529,000 in 2014, i.e. $390,000 paid to the political parties of Montreal and $139,000 paid to the parties of Quebec City.

Parties in municipalities of 50,000 inhabitants or more also benefit from special financing, in the form of reimbursements of research and secretarial costs. As such, 57 parties shared a total of $2.2M in reimbursements last year.

In every municipality, candidates meeting the AERM criteria can benefit from a reimbursement of 70% of their election expenses. In 2014, reimbursements totalling $550,000 were thus paid, related primarily to the municipal general elections of November 3, 2013.

All these sources of public financing come from municipalities where there are political parties. In this regard, 84.3% of the financial participation of municipalities is earmarked for the political parties of cities with 100,000 or more inhabitants. The parties of Quebec City and Montreal alone receive 64.6% of the amounts paid by municipalities.

The other level of public financing, i.e. contributions made by electors, declined by 23.8% in 2014, when compared to 2010, the last year following a general election. This decline is in part caused by the lowering of the maximum contribution from $1,000 to $300, in effect since June 21, 2013. A total of 52% of all contributions in 2014 were made to the political parties of Montreal and Quebec City. In all, political parties received approximately $700,000 in contributions in 2014. In this non-electoral year, 94 of the 178 parties received no contributions whatsoever.

Lastly, the AERM stipulates that contributions made in contravention of the Act must be returned to the municipal treasurer. During the 2014 financial year, the different parties returned a total of $27,775 for this reason. Of this amount, $17,850 (i.e. 24 contributions) were claimed by the office of the Chief Electoral Officer of Québec following investigations it carried out concerning events that occurred during the last five years.

The Portrait sur le financement des partis politiques municipaux (portrait of the financing of municipal political parties) can be found on the homepage of the website of the Chief Electoral Officer of Québec.

Categories : Municipal, Municipal financing, DGE

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