Political donations dropped to new low in March as COVID-19 spread

With the COVID-19 pandemic keeping people home, forcing businesses to remain closed and putting millions out of work, many Canadians are having difficulty making ends meet. An analysis of fundraising data from the first three months of 2020 suggests political parties are feeling the pinch, too.

Combined, the Liberals, Conservative and New Democrats raised about $7.7 million in the first quarter of 2020, the smallest amount raised by these three parties since the third quarter of 2016.

But it's the numbers for the month of March — when the novel coronavirus began to shut down businesses and schools in Canada — that are the most revealing.

Elections Canada doesn't provide complete data for all individual donations made to parties; it publishes names, addresses and dates only for contributions of $200 or more. Nevertheless, the data do provide a glimpse of how COVID-19 has affected political fundraising.

Counting only these larger donations, the three major parties raised $1.6 million in January, $1.4 million in February and just $1.1 million in March. While that trend line is down only modestly, what's most interesting here is how that compares to other years.

In raw numbers, March 2020 appears to have been the worst March for fundraising in Canada since March 2006, just a few months after the January 2006 federal election, when political donors likely would have been tapped for cash already.

Comparing a typical March to a typical January or February provides a clearer example of the impact of the pandemic.

Between 2005 and 2019, parties raised about as much money on average in February as they did in January. There were fluctuations from year to year, depending on the political circumstances at the time — but overall, February and January have tended to deliver similar fundraising results.

March is usually a much better fundraising month than January or February — parties generally try to maximize their fundraising at the end of each quarter. On average, parties raise 19 per cent more in March than they do in January or February.

In March 2020, however, the parties raised 34 per cent less than they did in January. With the exception of that election year in 2006, that is by far the worst monthly result since quarterly records began in 2005.

If March 2020 had been a normal month, the three parties likely would have raised about $900,000 more from contributors giving at least $200. Extrapolating that to account for smaller donations suggests the pandemic might have cost the Liberals, Conservatives and NDP nearly $2 million collectively in the month of March alone.

Parties changing how they work and raise cash

While this drop in fundraising will have an impact on parties' political activities, it also will have an effect on their day-to-day operations. The parties are among the many employers around the world trying to make payroll with reduced revenue.

In 2018, the last year for which data is available, both the Liberals and Conservatives booked over $5 million in salaries and benefits paid out to employees. The NDP reported about $2.5 million in payroll. These were the most expensive line items for both the Liberals and New Democrats (the Conservatives spent more on fundraising).

Typically, the Liberals employ about 100 people outside of an election. The Conservatives have roughly 60 full-time and part-time employees, while the NDP has nearly 40. Since mid-March, these party staffers have been working remotely from home — which can add to costs.

"Like many Canadians, organizations and not-for-profits, this has meant incurring unexpected expenses that ensure our staff have the ability and technology to work remotely for an extended period," said Cory Hann, director of communications for the Conservatives.

Though all parties have stopped in-person fundraising events, they are still keeping in contact with their supporters.

"Our teams are actively keeping in touch with volunteers and grassroots donors in virtual ways, including more than 30,000 check-in calls over the past eight weeks," said Braeden Caley, senior communications director for the Liberals.

"Fundraising events are on hold and other programs are seeing reduced results," said NDP national director Anne McGrath. "But the support for our work has held and we are emphasizing stewardship and maintaining strong connections with our supporters, despite the challenging economic situation."

As the outbreak grew in severity, parties shifted their fundraising tactics in March — recognizing that asking for donations during a pandemic can be awkward and not everyone is able to contribute.

"If people feel comfortable enough or are able to donate, we welcome it, and if they can't, we absolutely understand why," Hann said in an email.

McGrath said that the tone of the party's messages to supporters needed to change to "reflect the uncertainty and anxiety created by both public health and economic crises." The NDP also reduced the number of its email appeals and telephone calls to members.

Giving in the time of COVID-19

The fundraising data from Elections Canada only run until the end of March, but both McGrath and Caley said that the reduction in donations continued into April. Caley said the Liberals have "still seen tens of thousands of Canadians chipping in to show their support — often just $10 at a time, with a pace that has been increasing again in recent weeks."

"Some of our supporters are unable to give at this time and we completely understand that. Those who have had to cancel or reduce their monthly contributions have been clear that it is due to the economic circumstances and they are very regretful but pledge to restart in the future," said McGrath.

"We recognize that, despite the immediate crisis, we are in a minority Parliament and we must do all we can to ensure that we are ready to campaign for more NDP MPs in the next Parliament."

The results from the second quarter of 2020 won't be available until the end of July. By then, filings will also reveal the state of parties' fiscal health at the end of 2019, before they had any inkling of the financial hardships that were about to come.

That could have an impact beyond parties' bottom lines. Public health won't be the only factor parties weigh in deciding whether they can afford to send Canadians back to the polls sooner rather than later.