Conservatives sitting on $7 million nest-egg, and a $7 million surprise
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The Conservative Party has been able to set aside roughly one-third of their national expense ceiling for the next election, putting $7.1 million into guaranteed investment certificates of 1- to 2-years maturity last year according to their 2012 annual financial statements.
But the governing party is also sitting on a mystery project it's pumped another $7.1 million into over the last three years – $2.17M in 2010, $3.4M in 2011, and a further $1.74 in 2012.
Labelled an "asset under development", an accounting term used for such items as large-scale software projects still being completed, the project is listed as an "intangible asset" of the party — and between it and the GICs, the Conservatives find themselves asset-rich but cash-poor in the short-term.
We first learned of the project in the party's 2010 financial statements, and speculated at the time that it could be an investment in a web-based replacement for CIMS ("Son of CIMS"?) or perhaps a data warehouse and data mining project to analyze CIMS data, or possibly a geospatial information system (GIS) mapping application to analyze redistribution and other data to assist with targeting. (CIMS = "Constituent Information Management System")
Recent work out of the University of Oxford, however, points to the likelihood of IT projects either going south or running over-budget (18% run 200% or more of initial estimates), an estimate that was found not to differ between the private and public sectors.
Which means the Conservative are either sitting on "da bomb" or a "black swan", but they at least have another year or so to get it ready for the pre-election period. The notes to their financial statements say that it won't start to accumulate depreciation until it's put into service, or else suffers an "impairment". So far, so good.
Apart from that, the Canadian Press noted in their story last night that the Conservatives' fundraising pace is not keeping pace with the sum of their opponents' efforts. That may be true, but it's not their only concern. Comparing 2012 with the last non-election year of 2010, the governing party was still collecting roughly the same amount of money, but from 7,700 fewer donors. Given we've learned from Glen McGregor at Postmedia that one of their major vendors, RMG, has stopped doing donor acquisition calls for the party, that figure is not surprising, though it's undoubtedly of concern to them.
Selected Financial Metrics, by Party, 2010-12 Fiscal Years
|Net Assets||Cons||$7.31M||$5.80M||$12.0M||+ $4.69M|
|Working Capital||Cons||$4.50M||-$128K||-$1.44M||- $5.94M|
|Total Revenue||Cons||$29.22M||$46.90M||$28.31M||- $921K|
|Annual Budget||Cons||$22.35M||$48.41M||$22.08M||- $252K|
|Operating Surplus||Cons||$6.87M||-$1.51M||$6.22M||- $650K|
|Net Transfers Out||Cons||$2.23M||$3.39M||$1.82M||- $410K|
|# of Donors||Cons||95,010||110,267||87,306||- 7,704|
|Avg Contrib||Cons||$183.32||$206.21||$197.67||+ $14.35|
Meanwhile, the Liberals were pro-actively trying to tell their story in advance of their report's release, noting that while their fundraising was down year over year, they actually showed growth over 2010; and also pointing out that their performance was the "best of any third party since the new rules came into effect".
Indeed, the Liberals did move up smartly between 2010 and 2012 by $1.77M (a 27.7% increase). But not as much as the former third party to which they were implicitly comparing themselves, the NDP, which gained not only over the last non-election year in 2010, but even over the election year of 2011. The orange team raised a quarter million more in 2012 than 2011, and fully $3.31M more than 2010 (a 75.9%) increase. While the Liberals added 12,000 donors since 2010, the NDP added 20,700.
Of course the Dippers needed to, because they continued to have the only remaining post-election debt to service: $3.09M of their original $5.09M loan from the Van City Savings Credit Union was still on their books on Dec 31, being paid off at a rate of $2M annually. The Liberals, by contrast, are sitting on $7.33M in liquid assets ("working capital") and nearly $8M overall. What we don't know is whether those resources are sitting in the PTAs or headquarters, since the party did not share separate financial statements for the Federal Liberal Agency again this year, unlike in 2010.
Because the NDP owns its own building, one thing it doesn't have to pay for is rent. That didn't stop it from spending $15.1M in 2012, mainly on increased fundraising capacity, salaries and travel, but that figure was down fully $19 million from 2011, as was Liberal Party spending over the same time-period. The Conservatives slashed spending even more dramatically; down $26.4M from a year earlier. These amounts represent the cost of election and pre-election expenses incurred in 2011, of course, but also the amount the parties will have to accumulate before October 2015, this time without the full aid of the public subsidy.
The smaller parties are coping with the new reality by paying off debt (Greens), liquidating assets (BQ), cutting back expenses (both), deregistering EDAs (Greens), setting up reserved election funds (BQ), and loaning money to their riding associations to run by-elections instead of gifting it in a transfer (Greens). The Green Party maintained more or less its 2011 fundraising pace in 2012, while the Bloc showed a decline in both amounts, donors, and average donation size, meaning they are neither promoting small donors to larger ones, nor acquiring new donors, but simply hanging on for better days ahead. (EDA = "electoral district association", aka riding association)
Given the amount of cutting in line items on the Conservative's income and expense statement, it's hard to see where they would hide a "secret million dollar fund for the PMO". But I'm told by staffers in former PMOs that the chief of staff was always the person who decided which expenses were government ones and which to forward to the party, and he or she authorized such payments to be made by one body or the other. The line item for "Tour", which I'm told would be the major category of such spending, only comprised $11,226 in 2012, and only $8,186 was spent in total on polling, but other PMO expenses might be included under "Travel and Hospitality" and a few other spots. Take a look for yourself.
Given I didn't write about the 2011 annual party statements last year, I've consolidated the metrics into a 3-year comparison table above, but here for continuity are the usual yearly tables of Selected Financial Metrics you've come to expect.
Selected Financial Metrics, by Party, 2012 Fiscal Year
|# of Donors||44,466||43,537||9,532||4,292||87,306|
Selected Financial Metrics, by Party, 2011 Fiscal Year
|# of Donors||49,650||37,778||12,590||7,056||110,267|
Selected Financial Metrics, by Party, 2010 Fiscal Year
|# of Donors||32,448||22,807||8,961||5,685||95,010|
Tags: Party Finance