P.E.I. political funding: more than half from businesses, unions

Political parties on P.E.I. took in nearly $1.5 million in political donations in 2015, with more than half of that coming from corporations, groups and unions.

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A CBC News analysis of reports filed with Elections PEI shows donations from corporations, groups and a handful of unions provided to the parties in 2015 amount to $838,768, or 57 per cent of all money raised.

Elections PEI doesn't require parties to disclose details on donations of $250 or less. For the purpose of this analysis, CBC considered all those to be donations from individuals. CBC also assessed anyone listed by first and last name only, to be an individual rather than a business. 

 The Liberal Party of P.E.I. raised the most money in 2015, and also had the highest percentage of corporate/group donations at 61 per cent.

The Liberals have the most to lose under new rules signaled by P.E.I. Premier Wade MacLauchlan, who's promised an end to corporate and union donations, along with a $3,000 annual limit on personal donations.

The premier has said draft legislation will be tabled in the fall, following public consultations over the summer.

Parties will have to adapt

Getting rid of corporate and union donations will "make sure any financial donations are without any appearance of impropriety or influence" on government, said P.E.I. Liberal Party president Scott Barry, admitting his party's bottom line could take a hit.

The democratic process is something that needs to be encouraged and costs money.— Scott Barry, P.E.I. Liberal Party president

All parties will have to adapt, Barry said — for example, in the way they sell seats at a party fundraising dinner.

"Cause it's no longer going to be able to be the company that buys a table and sends eight attendees. We're going to need to find a way to reach those eight individuals and get the support from them."

Ottawa made this change years ago, Barry noted, and federal political parties developed much more grassroots-centred fundraising campaigns to adapt — although he thinks P.E.I. is too small for parties to send out a constant barrage of fundraising emails, as their federal counterparts do.

"P.E.I.'s unique in many ways. You see that in the way that election campaigns are run and fundraising is done. I think there would be challenges if you tried to focus as heavily on email requests for fundraising as what you see at the federal level," Barry said. 

Support for a per-vote subsidy

P.E.I.'s Green Party has been calling for a per-vote subsidy to fund political parties. With corporate donations about to be tossed, now the Liberal party is agreeing a subsidy could be the way to go.

"I think at a policy level it makes sense," said Barry. "The democratic process is something that needs to be encouraged and costs money."

A subsidy could be the best way to balance the need to fund political parties against concerns that funding itself can buy government influence, he said.

"That makes sure parties are still able to do the important work that they do, without having any fear that there's going to be undue influence attached to it."

In fact P.E.I. already has a per-vote subsidy in legislation, but according to the province's chief electoral officer it hasn't been used since the 1990s.

The legislation would allow parties to receive annual taxpayer funding of roughly three dollars per vote. Based on turnout in the last election, that measure would have a price tag of nearly a quarter of a million dollars.

Tax writeoff

But the current system of funding parties through political donations for which they receive tax credits also comes at a cost to the public purse. Political donors on P.E.I. earn credits against their provincial income tax ranging from 33 to 75 per cent, based on the size of the donation.

There are no official figures available, but CBC News estimates the $1.5 million in donations last year would have earned approximately $750,000 in tax credits for the donors.

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