Saturday, January 14, 2012

Alberta Political Finance: why you should be outraged


Over the summer of 2006 I was in discussions with senior representatives of the then, Alberta Alliance Party, regarding being appointed as their Chief Financial Officer. It would be a volunteer role, with no training or remuneration. Talks also included moving their office, from a space in Red Deer they could no longer afford, to my business office in northeast Calgary.


The move and my appointment as CFO were completed by mid September. Before the end of that same month, unbeknownst to me, three RCMP officers would descend upon my office. They would comb through every piece of paper ever generated by the very young Alberta Alliance. They took copies of hundreds of pages of documents. In some cases they took possession of the originals and left us with the photocopies.

The RCMP recorded audio statements from me on matters that occurred before I was even involved and I would sign off on a number of written statements as to my role with the Party, specifically in relation to the financial matters.

That was my baptism by fire to the world of political finance. Those three paragraphs are an excerpt from the introduction of "Before the Bloom". It will be many months yet before its complete, but recent events have prompted me to share this tidbit and my perspective on topic of political finances in Alberta.


Fundraising (and alleged illegal fundraising)  has been the hot topic this week in Alberta politics. Some say it is a blip and it won’t resonate with voters at election time. Yet I’ve heard from both Wildrose and PC candidates who are out door knocking that indeed the subject is coming up. Let’s face it, when it comes to how politicians handle money (our money) it should be front and centre. It is one area where I feel there must be the most transparency and accountability.

On Thursday Paul Hinman, MLA for Calgary-Glenmore, was on the Rutherford show on QR77 discussing this topic. Well worth a listen via the audio vault; January 12, 10:00 AM. (Starts at about the 7:30 minute mark) The first caller says he doesn’t like when one party is “criticizing and basically throwing another party under the bus”. He goes on to say the Wildrose hasn’t had a turn at the table, so shouldn’t be commenting on this issue.

The reality is every party can and should be vocal on these issues. Regardless of whether a party is the governing party, the opposition or has zero seats; they are ALL subject to the same electoral finance laws.  A brand spanking new party like the EverGreen Party (registered last month) is subject to the same rules as the PC’s who's origins go back over 100 years.

Which brings me to my first concern about electoral finances; how people learn the rules. In Alberta every party, every CA and every candidate must have a Chief Financial Officer (CFO, sometimes also called a Treasurer). The vast majority of these roles are held by volunteers, some with little or no formal training in accounting or bookkeeping; let alone the laws governing electoral finance. Some say it’s not a complicated role; “if you can balance a cheque book, you can handle the duties of being a CFO”. This is true to a point.

Tracking and receipting for donations and expenses can be fairly straight forward. However knowing if you can “accept” certain monies is another matter. Some volunteers receive training from their predecessor or as in my case no training at all. 

I relied upon reading pamphlets from Elections Alberta, the Elections Finance Act and asking a LOT of questions. Even with my own concerted effort I made mistakes. Elections Alberta was always available and offered tremendous guidance.

Occasionally, usually in the rush of a campaign, Elections Alberta will hold training sessions. And some parties provide training to their CA and candidate CFO’s. Generally though in both cases, they are far too short and lack the depth that the topic deserves.

This is a snap shot from the 2008 Elections Alberta report on training. (Page 39, click to enlarge)



Approximately 180 attended information sessions. In 2008 there were nine Parties in Alberta. Granted they didn't all have CFO's in each constituency and they didn't all run full slates of candidates. But we do know there were 407 candidates (plus CFO's is 814). If we assume only the three major parties (at the time) had 83 constituency associations, that's another 249. Over 1000 individuals who should be fully trained.

This lack of training is why we see the same mistakes happening repeatedly; mistakes that violate Election Finance laws. Don’t get me wrong, I’m not trying to justify these occurrences. Simply pointing out that if one is instructed that it is “okay” or that "it has always been done this way" they tend take it at face value. I believe we there should be detailed, formal training directly from Elections Alberta. It should be offered frequently and be a requirement for all CFO’s.

The second issue I have with current Election Finance law is unfortunately how closely it is tied to the governing party via Alberta Justice.  For example:

Back in 2007, then-chief electoral officer Lorne Gibson reported his office had investigated nine examples where Alberta politicians and parties had received improper contributions from municipalities and publicly funded organizations. He recommended Alberta Justice prosecute all nine cases. Penalties under the act include a maximum penalty of $10,000.
Instead, in six of the cases, Alberta Justice said there wasn't enough evidence to proceed and in three of the cases officials missed the two-year deadline to prosecute. Shouldn’t it go through a process and the courts decide if the evidence is sufficient?


It does make one wonder though, if Mr. Gibson was able to investigate far enough to recommend prosecution, he must have found something. Yet the government of the day was able to dismiss the cases by saying there wasn’t enough evidence. Ironically, (or maybe not so ironic) Mr. Gibson’s contract wasn’t renewed. It's also interesting to note that since then (2009) the new (well re-run) Chief Electoral Officer, Brian Fjeldheim,  hasn't made any (as in zero) recommendations for prosecutions.

This brings up a third area of discussion. Who is involved? I can understand Elections Alberta not revealing who they are investigating. That would be like the police putting out a list of suspect drug ops. However, in my opinion once charges are laid it should be public information and I do believe they have been, as we see here, a case involving PC MLA Pearl Calahasen. 

Now if a party wants to demonstrate they are “open and transparent” and willingly reveal any entities under investigation; that is (in my opinion) purely up to them. Plus any party that pressures another to do so better be prepared to walk that path as well.

The Lorne Gibson example above also mentions that a couple of cases missed the two year time limit on prosecution. (I believe the law now has a 3 year window) Either way, this will be the case for the University of Lethbridge, where the most recent alleged infraction appears to have been in 2005. If we (meaning Albertans) want infractions investigated and charged in a timely fashion, we will have to demand that Elections Alberta be given the means and authority to do so. While I’m not familiar with the current resources of Elections Alberta, I can tell you that from 2006 to 2010 (while I was CFO/Executive Director of the Wildrose) they appeared to be understaffed and underfunded.

The most recent case that has been unveiled is with the Medicine Hat Catholic School Board, they admit they bought tickets to the recent Premiers dinner and in fact have purchased fundraising tickets for some seven years now. This is a prime example of how political donations can get downright messy.
According to the PC President:

……. Bill Smith said the party had no inkling the board paid for the tickets and said a purchase receipt was given to the individual who bought them.
Tickets were purchased with a corporate credit card, which bears the name of the board employee and the term Medicine Hat Catholic.

While I hate to side with the PC’s, Bill is likely right on the money (no pun intended) as to how this came about.  There is no way every CFO in the province can run searches or ask every donor what boards they might sit on, who they might work for or who might be reimbursing them for the expense.

Where it gets messy is with this person who got the receipt.  They get the taxable benefit from that contribution and if they are also getting reimbursed by other attendees to the event or by group that is not allowed to contribute, they are double-dipping. More importantly though, it would be tax fraud. 

While fellow blogger Dave Cournoyer questions why he doesn't feel outraged by the illegal donations, I believe we should not only be outraged, we should bear some responsibility for it. 

Outraged that these things can happen in Canada of all places; we are not a third world dictatorship. 

And responsible because we have allowed it to happen. We need to all demand better. Regardless of your party affiliation or your political leanings; we need to demand that Elections Alberta be given the resources to carryout their mandate. We need to demand that all CFO's be provided the training and tools to adhere to the laws.




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2 comments:

  1. This should be good,can't wait!

    ReplyDelete
  2. Great post Jane. Interesting perspective from the financial side.

    ReplyDelete