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Former Ontario Progressive Conservative leader Tim Hudak, seen on June 12, 2014, estimates he faced about $20-million worth of attack ads during his two elections as PC leader, some of those run by third-party campaigns.Geoff Robins/The Canadian Press

Ontario unions have spent more than $15-million to campaign in the past three general elections, 94 per cent of all third-party advertising.

The advertising has been aimed mainly at the Progressive Conservative Party by two labour umbrella groups, Working Families and Project Ontario, which both have strong ties to other political parties.

Working Families employs a communications firm that has also held major contracts with the Ontario Liberal Party, while veteran NDP strategist Brian Topp was a leader of Project Ontario during the most recent election.

Related: The players involved in Ontario's third-party campaign advertising

This is all completely legal in Ontario. While spending is capped for political parties at election time, third-party advertisers face no such restriction. And current rules do not prevent groups such as Working Families or Project Ontario from hiring strategists connected to political parties to work on their campaigns. It all raises the spectre of a system similar to U.S.-style SuperPACs: Groups that operate at arm's length from politicians, but function as their proxies to attack opponents and circumvent the spending limits.

While third-party advertising has long been controversial in Ontario – the PCs tried to get Elections Ontario to rule that Working Families was a Liberal front in 2009 – a Globe and Mail tally of Elections Ontario data reveals the scale of the practice.

In the three election campaigns since 2007, when third-party advertisers first had to disclose their spending, Ontarians have seen $16.4-million worth of such advertising – $15.4-million of it financed by unions. Corporate spending accounted for $641,000, and other advocacy groups accounted for $409,000.

Greg Essensa, the province's independent chief electoral officer, is speaking out on the system. He says current rules are so lax they could allow politicians to "circumvent contribution and spending limits" by co-ordinating their campaigns with those of third-party advertisers.

Premier Kathleen Wynne's proposed campaign finance reform, Bill 201, contains the first measures in the province's history to cap third-party advertising: Corporations, unions or individuals could spend no more than $100,000 during an election campaign period and $600,000 in the six months before.

Mr. Essensa told a legislative committee studying the bill last month that the legislation must get tougher.

"The public can plainly see that candidates and organizations that claim to be non-partisan are able to actively co-ordinate their advertising," he said. "This sort of co-ordination is especially troubling when an organization relies on former political staff or partisan strategists to shape a third party's advertising. The public sees this as an apparent conflict of interest, and I do, too."

Under the current rules, he said, it would have to be proven that a political party had controlled a third-party's campaign for it to be deemed collusion – a difficult task. Mr. Essensa said the legislation should ban people who have been political staffers, party officials or consultants to a political party from working on third-party advertising campaigns.

Working Families is, by far, the province's biggest spender on third-party ads. Since 2007, the group poured more than $4.6-million into three general elections: a little over $1-million in each of the 2007 and 2011 campaigns, and $2.5-million in 2014.

The group is primarily financed by unions representing skilled trades and teachers' associations. Its chair is Patrick Dillon, head of the Provincial Building Trades Council.

Working Families' campaigns are run by Arrow Communications Group, a firm headed by veteran political strategist Marcel Wieder. Arrow made more than $4.3-million from Working Families over the past three elections.

Arrow was also paid $1.4-million to do work for the Ontario Liberals between 2006 and 2013. The money came from the taxpayer-funded caucus services budget.

Up to the 2007 campaign, Working Families also employed Pollara Strategic Insights, a company then headed by Don Guy, who was the Liberals' campaign director at the time.

Working Families' ads have been some of the province's most memorable. One 2014 spot depicted the Tories then-leader Tim Hudak as a cartoon Pinocchio, his nose growing with every campaign promise. Another described the PC Party as "the old boys' club" and showed an actor playing Mr. Hudak cutting backroom deals with shadowy Bay Street suits.

Mr. Wieder insists he keeps a firewall between his work for the Liberals and his campaigns for Working Families.

"I can assure you and your readers there is no direct connection between the two," he said. "Do I have friends who worked on the [Liberal] campaign? Absolutely, I have friends. Did we talk about how the campaign was going? I'm sure it came up in conversation, as friends talk about how things are going and how family and things are. But was there any material transfer of knowledge, of tactics, of strategy? None."

Mr. Dillon says his group chose Arrow and Pollara not for their Liberal ties but because they were the best firms for the job. He said Working Families also interviewed strategists affiliated with the PCs and the New Democrats when the group formed before the 2003 election.

"There's not a whole lot of people in this business, tied into the political business, that are out there to choose from," he said.

Project Ontario was started before the 2014 campaign and spent a little under $450,000 in the election. It was funded by the United Steelworkers, the Ontario Secondary School Teachers Federation and Local 113 of the Amalgamated Transit Union, which represents Toronto Transit Commission employees.

The group's filings with Elections Ontario list Mr. Topp, a long-time NDP staffer and one-time federal leadership candidate, as a contact person. Mr. Topp worked for Ontario NDP Leader Andrea Horwath for a few months after the election.

Project Ontario's campaign was primarily a series of anti-Conservative ads shown in Southwestern Ontario ridings where the NDP was battling the PCs. The NDP's strategy in the last election focused on making gains in the southwest.

Mark Rowlinson, a United Steelworkers' staffer, said Project Ontario's anti-Tory ads were mainly aimed at voters wavering between the PCs and the NDP. But he insisted the group did not co-ordinate with the NDP.

"The people involved in that project had no contact with the party – with the NDP, or with any other," he said.

In an e-mail, Mr. Topp confirmed he was an officer of Project Ontario, but said he "played no role" in the NDP's campaign.

The individual unions that spend the most on election ads over the years in the province have been the Ontario English Catholic Teachers' Association, which paid out more than $4.5-million in the course of the past three elections, and the Elementary Teachers' Federation of Ontario (ETFO), which spent $4.3-million. Some of this money was for the unions' own campaigns, and some was contributed to Working Families.

The unions and the Tories say the attack ads had the intended effect.

ETFO president Sam Hammond contends his association's involvement in elections encouraged the Liberals to adopt such measures as caps on class sizes and full-day kindergarten.

"If you look back at the relationship we had with the government for two or three election cycles, there were a lot of positive things that came out of us being politically active," he said. "It does have a benefit to our members."

Mr. Hudak estimates he faced about $20-million worth of attack ads during his two elections as PC leader, between third-party campaigns and the two rival parties.

"Almost $20-million in negative ads will give people a certain impression that may not be accurate. You do that to Mother Teresa and they'll start suspecting her as well," he said in an interview.

But the people behind the third-party advertising contend that imposing limits would stifle freedom of expression.

Mr. Dillon said politicians are able to ensure there are no improper ties between themselves and the third-party groups.

"People operate – whether they're lawyers or doctors or politicians – with a certain amount of integrity," he said. "A little self-control, in my view, is all that's needed."

And he said Bill 201's provision to restrict third-party advertising for six months before an election campaign would be unconstitutional and could be challenged in court.

He is not alone on that point. Campaign finance expert Robert MacDermid points to the Supreme Court's 2004 decision on federal third-party advertising restrictions during election campaigns: Although the court upheld the restrictions, Mr. MacDermid says it was not an easy decision and the bench might rule differently if spending limits were stretched outside the campaign period.

"A close reading of the Supreme Court … decision indicates that the justices agonized over restrictions as long as a federal election campaign. It is hard to imagine their reading of the Charter would permit a six-month-long restriction," he told the committee that is reviewing the campaign finance bill last month.

Mr. Essensa said concerns about freedom of expression could be addressed by differentiating in the law between advocacy groups campaigning for general causes – better environmental protections, for instance – and attack ads targeting candidates or parties.

"If there is an issue-advocacy group that is advocating for an issue...there shouldn't be restrictions on that," he said. "But where there needs to be restrictions is on advertising that depicts a party leader, depicts a candidate, depicts a party and is trying to influence the electorate the next time they appear at the ballot box."

With reports from Jane Taber

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