The BC NDP, currently pushing legislation through the House to provide public financing of political parties, went into the last provincial election weighed down by debt going back to the 2009 campaign.
At the NDP's convention on the weekend, details of these financial challenges shed new light on why publicly funded subsidies will be welcomed at party headquarters.
Campaign finance reform is proving to be one of the slowest-moving bills in the B.C. Legislature this fall. It's designed to wean political parties off of corporate and union donations by providing public funding that will begin to flow to the province's three main political parties in January.
Getting big money out of politics was a key promise of the NDP in the election last May, but debate on the bill has been contentious because of the unexpected feature of public funding that will cost B.C. taxpayers millions of dollars annually – a measure that had been previously rejected by the NDP. The bill does have the support of the BC Green Party, however, and is expected to pass later this month.
In her report to delegates at the convention, NDP treasurer Amber Hockin outlined the party's struggles with fundraising in the two years leading up to the May, 2017, election.
Her report began with a snapshot of 2015 – the party was carrying external loans from the 2009 and 2013 elections, as well as internal debt owed to its individual constituency associations. Labour allies had disconnected following the party's disappointing election loss in 2013, and individual donors were feeling tapped out after the federal election.
"It was a very tough fundraising climate at every turn. Exacerbating our own difficulties was the fact that the Liberals seemed to have no difficulties raising money," she said in her report to delegates.
The New Democrats were having trouble raising funds for two by-elections held in 2016, much less preparing a war chest for the coming 2017 election. Operating costs were being paid out of reserves.
By the end of 2016, Ms. Hockin said, fundraising efforts began to improve. "A significant factor in our success was the support of the labour movement. Relationships that had lagged following the results of the 2013 election had been rebuilt."
Still, she said, the party ended 2016 with internal debt – money owed to NDP riding associations – and external debt, including a loan from the 2013 election.
Internal strife between the central party and its 85 riding associations over money hampered the party's ability to obtain loans for the 2017 campaign.
At the start of this year, the central party owed more than $880,000 to its riding associations, built up over three election cycles.
In her report, Ms. Hockin said "a lot of work" went into seeking forgiveness of those loans, but "despite our best efforts, the internal debt remained an impediment."
Last February, the NDP's provincial council approved an election budget of $11.4-million, which included approval for a $1.8-million loan. However, with internal debt still on the books, the central party was able to borrow less than half of that amount.
In an interview after delivering her report to the party delegates, Ms. Hockin said the party has struck a committee to figure out how to manage fundraising under the new campaign finance rules. A key issue will be to decide how public funds that will flow under the new legislation will be distributed between the party's central office and the constituencies – or if all the money will only come to the NDP headquarters. In 2018, the NDP can expect to receive a little less than $2-million in public funds.
Under the current system, the NDP has more than 80 different fundraising organizations – one for each constituency and one for the central office. "Having all those different financial systems is our biggest challenge," she said.
The proposed changes to the Elections Act signal an end of a system that earned the province the reputation of Canada's Wild West of political fundraising, where parties have long relied on big-money donations with virtually no limits. Once in place, the law will ban out-of-province contributions, cap individual donations at $1,200 annually to a political party and its candidates. To replace some of the lost revenue as parties adjust to the new rules, the legislation would introduce a public subsidy tied to votes received in the most recent election. The subsidy would start at $2.50 a vote next year, decreasing to $1.75 a vote in 2022, when the subsidy would be reviewed.