The Liberal Party Is Not Broke
At the end of 2008, the Liberal Party of Canada was solvent, but just slightly less so than the NDP, and liquid, but just slightly less so than the Conservatives, just-posted financial returns confirm. The party recorded a year-end Net Worth of $934.6K (down from $4.5M in 2006 and $2.8M in 2007), and Net Current Assets of $430.3K (down from $4M in 2006 and $2.3M in 2007), compared with an NDP Net Worth of $952K and Conservative Net Current Assets of $463.8K.
The Liberal return was indeed filed before the Tuesday midnight deadline, sources confirm, but was not posted on the Elections Canada website until around noon Friday. Comparable numbers for the other parties were reported here earlier.
While the Liberals carried outstanding bank loans of $11.2M at the end of the calendar year, all but $2M or so were covered by the $9.4M election rebate it was due to receive in the new year.
Details of the party's loans and lines-of-credit were also reported (with comparable details included):
Annual contribution totals and counts were also reported, showing little variation from the sum of the quarterly contributions, but of course with much more accurate counts of the numbers of contributors by category. Those figures are tabulated below, however while every party but the Bloc showed a record volume of contributions going back to 2004 (when the rules and reporting methods changed), and even the Bloc had a much better year than the last two, although not as good as 2004 and 2005, the Liberal total of $5.8M fell well below its earlier, much better years of 2005 ($8.3M) and 2006 ($9.0M).
As we remarked on earlier for the Conservatives, Liberal totals for contributions of $200 and below have remained fairly stable from year to year (they usually stay around $1.5M to the Conservatives' $8M, but showed an increase to $1.9M this past year), but again it's their contributions over $200 which spiked during 2005 and 2006 and then fell off again afterwards. The other parties reporting to date tend to see increases both over and under $200 during election years.
For the latest in financial updates, you can now follow the Pundits' Guide on Twitter.
The Liberal return was indeed filed before the Tuesday midnight deadline, sources confirm, but was not posted on the Elections Canada website until around noon Friday. Comparable numbers for the other parties were reported here earlier.
While the Liberals carried outstanding bank loans of $11.2M at the end of the calendar year, all but $2M or so were covered by the $9.4M election rebate it was due to receive in the new year.
Details of the party's loans and lines-of-credit were also reported (with comparable details included):
- The Liberals borrowed $11.8M in a series of loans from a consortium of Big 5 Banks at rates between 3.5% and 4.5%. In addition, they established a $900K line of credit at 3.5% from the Royal Bank of Canada.
- The Conservatives' borrowed $15M from the CIBC at between 5.5% and 6.25% (reported as Prime+1.5% in their financial statements)
- The NDP borrowed $14M from the Citizens' Bank of Canada at 3.5%
- The Bloc renegotiated its current line of credit to a maximum of $1.1M at Prime+1%, and arranged for an additional election line of credit worth $3.5M at the same interest rate, guaranteed by their election rebate
- The Greens borrowed $1.15M from TD Canada Trust at 5.75%, and another 35 loans from individuals totalling $1.57M at rates from 4.75% to 7%.
Annual contribution totals and counts were also reported, showing little variation from the sum of the quarterly contributions, but of course with much more accurate counts of the numbers of contributors by category. Those figures are tabulated below, however while every party but the Bloc showed a record volume of contributions going back to 2004 (when the rules and reporting methods changed), and even the Bloc had a much better year than the last two, although not as good as 2004 and 2005, the Liberal total of $5.8M fell well below its earlier, much better years of 2005 ($8.3M) and 2006 ($9.0M).
Contribution Amounts, Counts and Average Contribution Size, by Party and Donor Category, 2008 Financial Year
| 2008 | Lib | NDP | Grn | BQ | Cons |
|---|---|---|---|---|---|
| $ TOT num $ avg | 5,811,492 30,890 $188.14 | 5,412,940 29,732 $182.06 | 1,621,532 17,288 $93.80 | 713,085 7,445 $95.78 | 21,179,483 112,184 $188.79 |
| $ < $20 num $ avg | 12,100 1,142 $10.60 | 878 101 $8.69 | 107 20 $5.35 | -- | -- |
| $ <= $200 num $ avg | 1,899,700 22,242 $85.41 | 2,040,925 21,763 $93.78 | 840,492 15,479 $54.30 | 421,280 6,760 $62.32 | 8,494,070 86,149 $98.60 |
| $ > $200 num $ avg | 3,899,692 7,506 $519.54 | 3,371,137 7,969 $423.03 | 780,933 1,809 $431.69 | 291,805 685 $425.99 | 12,685,412 26,035 $487.24 |
As we remarked on earlier for the Conservatives, Liberal totals for contributions of $200 and below have remained fairly stable from year to year (they usually stay around $1.5M to the Conservatives' $8M, but showed an increase to $1.9M this past year), but again it's their contributions over $200 which spiked during 2005 and 2006 and then fell off again afterwards. The other parties reporting to date tend to see increases both over and under $200 during election years.
For the latest in financial updates, you can now follow the Pundits' Guide on Twitter.
Labels: Bloc Québécois, Conservatives, Greens, Liberals, NDP, Party Finance
posted by The Pundits' Guide at
12:46 PM
2 Comments:
BELATEDLY MOVING MY COMMENT BELOW FROM THE WRONG BLOGPOST:
I never thought the LPC was 'broke'. Like a number of close observors, I did think that the LPC seemed to have a debilitating debt load, and did quite a bit of spinning to cover for that. This is apparently not true.
When this 2008 filing came in, I was looking at trends in the LPC financial statements since the sea changes brought on by Chretien's changes to election financing. And I have some comments that follow from the following two key observations.
** Accumulated debt- despite many appearances to the contrary during the last couple years- was never more than a couple million $$$$. [Which would not normally be considered a significant debt load given the size of the LPC budget.]
** Corollary point: the current increase in fundraising by the LPC- also despite appearances to the contrary- has only resulted in a modest return to an earlier financial “plateau” the LPC was at- pre-Dion, but after the changes that are causing the Liberals so much trouble. And the jury is still out on whether that return to the ‘plateau’ will be consolidated… let alone whether they are poised to move on up.
The LPC is a high overhead organization that requires at least $15million a year just to remain in steady state- with very little pre-election advertising, limited polling, little to invest in organizing, etc.
In the context of that high essentially fixed overhead, the fundraising drop of 2007 and 2008 led to an accumulating operating deficit, which in turn was the backdrop to a surprising late triage of about $4M out of the 2008 election budget.
Along with some other indicators, this greatly contributed to the sense many of us had that the LPC ‘spinocracy’ was hiding something: among other things, that the bailout on crucial late campaign advertising would mean that the debt had to be more than the mere “million or two” claimed.
But it would appear that the overarching reality of LPC finances is simply this: high fixed expenses, barely adequate fundraising that sometimes even doesn’t meet that standard, and almost no maneuvering room.
So little maneuvering room that what would appear to others to be a pretty small debt of a couple million, was sufficient to get the officers of the good ship Liberal to pitch cargo overboard.
At a more or less fixed expense level of $15M (allowing for no ‘extras’), the LPC now have to take in $8M in contributions annually, just to remain at breakeven.
Having raised almost $5M in the first half of 2009 that $8M might seem assured. But the first quarter contributions were VERY heavy on those individuals already at or near the annual limit of $1100. And the Q2 fundraising has also been anchored at the big events bringing in those large and mostly one time contributions (for the year at least). There is a definite bottom to that barrel.
The LPC knows it can only stabilize, let alone grow, with a sustainable donor capability rooted in the legions of small donors they have lacked, and they have yet to show any progress on that front. So even achieving $8M in 2009 contributions to breakeven, is still something that remains to be seen.
Contingent as maintaining breakeven still is for the LPC- it is still not enough to provide for a full spending limit election campaign. [Albeit, if they have no debt, they can, unlike last year’s campaign, at least choose to go into debt a couple million for the campaign.]
That is a MUCH shorter leash than the NDP works on- let alone comparisons made to the Conservatives.
Postscript to that...
By comparison to the LPC's requirement of $8M in contributions required to remain solvent.... the NDP only requires a little over $2million.
Not to mention the collateral of a free and clear building worth several million dollars, while the LPC has no significant collateral to offer.
Unquestionably, the NDP can reach the floor of $2M, and easily does more than that EVERY year... much more easily than does the LPC reach its minimum requirement of $8M.
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