Pundits' Guide

As part of covering the April 14, 2013 Federal Liberal Leadership Contest, I've once again assembled a one-stop shop, social media and news aggregator page to track developments in the race.

Meet the "Pundits' Guide to the Liberal Federal Leadership Race" found at: http://lpcldr.punditsguide.ca.

As before, you can catch the latest news, tweets, and Facebook friend counts for all the candidates, whether declared or still mulling, and I've assembled a calendar of key dates in the race, a summary of the rules, and whatever else I can find that we can count.

And of course, there's an index to all the blogposts I've written and will be writing on the issue of Leadership Contest rules, Leadership Finance, and associated data.

Stay tuned for further updates, as more candidates declare and register. But for now: load and refresh.

[Welcome, National Newswatch readers!]

If we're really honest, the federal polls don't mean too much three years out from an election and with still one interim leader, seat projections are an iffy proposition given the pending redistribution and a party system likely still in transition, and most of the financial data we're getting lately can only tell us in great detail what happened last year.

But Monday evening's release of the federal party second quarter fundraising reports hints at a few potential trends in the making. And of course with the looming end of the quarterly public subsidy payments, getting its fundraising machinery into shape is paramount for any political party wanting to challenge the governing Conservatives.

Here's what the reports suggest:

• The NDP came within $63K of beating the Liberals in second quarter fundraising: $1,743,862.40 to the Liberals' $1,807,092.36. This comes after a first quarter where they were some $337K behind the Liberals, who naturally took full advantage of their competitor's leadership vacuum to try and guarantee a niche of political and financial support for themselves in their new role as the third party.
• At some $3.74M year-to-date the NDP has raised nearly as much by the end of June as it usually raises in an entire non-election year. For example, this amounts to 86% of the party's best ever non-election year haul of 2010 (then $4.38M). These two developments combined raise the spectre that the NDP might surpass the Liberals in fundraising by the end of December.
• The Liberals, meanwhile, are succeeding in increasing their numbers of small donors. And while the NDP is also demonstrating some real progress in increasing its number of overall donors over previous non-election years, the Liberals have been able to move and stay ahead of them on that score. (See the "Quarterly Data" tab at the Pundits' Guide "Finances" page for all the details).
• The Conservatives, on the other hand, are seeing another slip in their numbers of both small donors and overall donors, after last year's push to win a majority government. This did not hurt their overall fundraising take for the moment, as it looks like the party made a big push for "at the limit" contributions of $1,000-$1,200 in the second-quarter including what looks like a very successful push in the Montréal area the first week of June. But every majority government takes a hit as it rolls out the toughest part of its agenda early in its mandate, and no government lasts forever, so if there is to be any early warning sign of a more permanent change in their fortunes, it will show up as a decline in the number of small contributors. Although, we've seen false positives before.
• The Green Party is not dead yet, as their recent fundraising performance will attest. A healthy second quarter for them seems to be in part the result of prepaid convention fees (lots of $249 contributions showing up), but not exclusively. Unfortunately for them, as we'll see when we review the 2011 annual financial statements in a subsequent post, they have to raise this money in order to repay their election loans.
• The Bloc Québécois might be on life support, but on the other hand, their usual pattern is to go dormant on the fundraising front when their sister party needs to build up its own provincial warchest. When a federal election was constantly looming, the Bloc stepped up its on-going fundraising, but otherwise typically it did a round of central fundraising at year-end, and otherwise left the field open to its riding associations.

Now, part of what's allowing the NDP to compete with the Liberals are some significant bequests, and they got another one in the second quarter of 2012 — just over $296K from the estate of a William Giesbrecht of Coquitlam, BC, along with another bequest of some $23K from Anne Murray Powell of Toronto, ON. The estate of the late Jack Layton made a $50K bequest in December, 2011 and another $50K in March, 2012, though no further bequests from the party's former leader were recorded this quarter.

But a quick scan of the party donor lists hints at another part of the explanation. With names like Louise Arbour (if it's the same person, once touted as a potential Liberal leader), and that of a former national campaign director for the Green Party showing up on the NDP's return, it suggests the strategic voting / contributing card is being played by the NDP for a change.

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The biggest NDP bequest shows up on the weekly large donor fundraising timeline along with a late March post-leadership bump, as do the Conservative campaigns to large donors in late January and early June, and the spike in Liberal tallies from their convention in January and again in late March when the Conservatives ran attack ads against their interim leader, Bob Rae. That one Conservative TV ad was worth over $200K in revenue to the Liberals the week it launched, proving that some laws of physics also apply to politics.

The quarterly returns also give us an update on where the NDP Leadership candidates' fundraising efforts got to, after the contest ended.

Directed Contributions to NDP Leadership Contestants (before party tithe), as reported on the party's quarterly financial returns

Leader Tom Mulcair is said to have paid off all his leadership debts some time ago, and is now doing fundraising events with his former competitors to help pay off theirs. Nathan Cullen is thought not to have had any debt, given that he raised most of his money too late to spend it, and the rest have whittled their debts down to a greater or lesser extent, which we will find out in detail when they file their returns six months after the contest concluded.

Meanwhile amongst the remaining 2006 Liberal Leadership candidates, Hedy Fry did most of the fundraising in the first quarter, but she was joined on a much more active basis by Martha Hall Findley in the second.

NDP Leadership candidates raised about $1.3M all told in the first two quarters, while the 2006 Liberal leadership candidates raised another $68K or so.

[Welcome, National Newswatch readers!]

Today as the nation's capital focuses on the first in a series of votes on the government's budgetary, economic, and kitchen sink policy, another set of votes will be taken on the future of one of the historic players in Canada's political party system.

• The Ottawa media will crown someone as a front-runner who they know and/or think their audiences already know.
• For this reason, carrying the mantle of the early "front-runner" is not always all it's cracked up to be.
• A good idea and a clear message about it can vault an underestimated candidate into the final consideration set, ahead of many other more familiar names.
• One member-one vote races require organization to win, but organization alone is not sufficient to win them.
• Regardless of how many other things a candidate does well, it will be One Big Thing that trips them up in the end, and that one big thing is usually knowable or guessable in the first week or so.
• It can be hard to tell the difference between a Game Changer and a Hail Mary Pass when you're in the thick of a campaign, but it's obvious to pretty much everyone else on the outside eventually.

The "Leadership Primary" – currently in the news as a proposal before next week's Liberal Party convention – has been tried before as a method of increasing media coverage of the succession in smaller parties, the most notable recent example being the Federal NDP in 1995, after their brutal rout in the 1993 general election.

The party organized a series of regional and labour primaries in advance of the convention, designed to give regional candidates a base from which to build, and as a way of screening out candidates who could not win at least one of the primaries from consideration at the party convention in October.

Four candidates entered the race, and all but author Herschel Hardin passed the one-primary or 25% overall vote threshold (Hardin penned a very interesting personal history of his journey in the race afterwards, excerpts of which can be found on his website here).

Long-time activist M.P. Svend Robinson won the Québec, Ontario, and BC/Northern primaries, while veteran M.P. (indeed veteran leadership candidate) Lorne Nystrom won the Prairie and Labour primaries, and former Nova Scotia NDP leader Alexa McDonough won the Atlantic primary. Given the preponderance of the NDP membership on the prairies at that time, Nystrom looked like the prohibitive front-runner at the end of that process.

But, the total primary vote bore no outcome to the result at the October 1995 convention. McDonough had won 18.5% of the vote or so during the primaries, and was considered to be out of the race.  However, she went on to command a sufficiently strong 32.5% vote amongst convention delegates (remembering that the convention was held in Ontario), leaving the first-place Robinson scrambling to beat Nystrom to the stage to claim credit for the inevitable outcome, once third-place Nystrom was dropped after the first ballot.

So, Nystrom won the primaries, Robinson won the first ballot, and McDonough won the leadership. And Herschel Hardin got a very interesting book out of it all.

Here are the detailed results:

1995 Federal NDP Leadership Primary Vote vs Convention Vote

Thanks to a friendly archivist for digging up the raw figures and sending them along. We'll review the other NDP leadership contest history in another post.

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For the latest on the NDP Leadership Race, don't forget to follow the half-hourly news updates, and social media tickers at the Pundits' Guide NDPLdr portal page:  http://ndpldr.punditsguide.ca

[Welcome, National Newswatch readers!]

As a first step to covering the March 24, 2012 Federal NDP Leadership Contest, I've assembled a one-stop shop, social media and news aggregator page to track developments in the race.

Meet the "Pundits' Guide to the NDP Federal Leadership Race" found at: http://ndpldr.punditsguide.ca.

You can catch the latest news, tweets, and Facebook friend counts for all the candidates, whether declared or still mulling, and I've assembled a calendar of key dates in the race, a summary of the rules, and the latest party membership counts by province.

And of course, there's an index to all the blogposts I've written and will be writing on the issue of Leadership Contest rules, Leadership Finance, and associated data.

Stay tuned for further updates, as more candidates declare and register. But for now: load and refresh.

[Welcome, National Newswatch readers!]

As a follow to our last post on the latest filings from the 2006 Liberal leadership contestants with outstanding debts to pay off, I've compiled the fundraising totals reported in each of the contestant's interim and/or final/amended returns at the Elections Canada website.

UPDATE: More from Glen McGregor here, where he puts all the fundraising data into his Tableau software and analyzes it by size, date and location.

And one of the minor candidates is standing out from all the others.

First up is the monetary fundraising by the four major candidates (i.e., those who finished up in the top 4 spots, and whose initial placement and subsequent movements determined the final outcome, and all of whom raised at least one million dollars).

[Note: on the Finances page of this website I show the monetary + non-monetary contributions to political parties. In this instance I'm showing the monetary only, as the non-monetary ("in-kind") contributions were mostly insignificant and an extra step in the calculations. Eventually, I'll report everything properly.]

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Of these four candidates, Messrs. Rae and Ignatieff have long ago filed final returns, with Mr. Ignatieff raising around $204K in the last six months of 2008, and Mr. Rae filing his final return a month before this timeframe.

Mr. Dion is now within $30,000 of retiring his debts, having raised some $615K since June of 2008 (albeit most of it in the first 18 months of the timeframe). Gerard Kennedy has raised $193K since June, 2008, with $108K to go.

Next we look at the lower-tier candidates with outstanding obligations, and notice that Maurizio Bevilacqua's performance stands out from the crowd, over the three years since the end of the leadership contest period.

[Note that Carolyn Bennett also had a $0 balance when she completed her filings shortly after the contest concluded. She had raised a total of $170K during her campaign.]

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Here we see that Mr. Bevilacqua raised $269K from June 2008 to June 2011, while Martha Hall Findlay raised $87K, Ken Dryden raised $78K, Joe Volpe raised $62K, and Hedy Fry raised $23K. Scott Brison raised $52K – most of it in the first year – which was sufficient to retire his debts and file his final return.

So, Maurizio Bevilacqua raised as much as four of the other five minor candidates combined, most of it during the period between June, 2009 and December, 2010, and he is now $33K or so away from retiring his debts as well. The bulk of his fundraising would have come during the lead-up to last November's municipal election, when he successfully ran to become the Mayor of Vaughan, Ontario. He must have been highly focused on getting this issue put behind him before switching gears in his political career.

Bevilacqua was also the only candidate to borrow more than the value of his reported leadership campaign expenses, the difference in spending being mostly accounted for by interest costs and a charge for membership forms, neither of which are included as campaign expenses for the purpose of leadership contests, and the $50K refundable entrance fee paid to the Liberal Party, which is said to be before the courts.

Selected Metrics, 2006 Liberal Leadership Contest

[Welcome, National Newswatch readers!]

The rules governing leadership fundraising in the Elections Act need changing, and fast. This is not a partisan question, as it could have an impact on any of the federal political parties within the next five years.

The current contribution regime for leadership contestants is amongst the worst-understood provisions of the Elections Act. Political actors, pundits and journalists alike get it wrong routinely, and I have even met MPs who voted in favour of the change who do not realize what the provision actually says.

Most people believe there is an annual contribution ceiling to leadership contestant, because that's what there is in every other case and it would just make common sense. But that's not what the law says, and I have to say: I believe the law is wrong-headed on this point.

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Here's the relevant section of the Elections Act:

405. (1) No individual shall make contributions that exceed

• (a) $1,000 in total in any calendar year to a particular registered party;
• (a.1) $1,000 in total in any calendar year to the registered associations, nomination contestants and candidates of a particular registered party;
• (b) $1,000 in total to a candidate for a particular election who is not the candidate of a registered party; and
• (c) $1,000 in total to the leadership contestants in a particular leadership contest.

The amounts in s.405(1) are scaled up through an inflation adjustment, in increments of $100, with a base year of 2002, as per s.405.1. Thus any reference to $1,000 became $1,100 almost right away, and would now be $1,200 (though this is not being implemented until 2012, I'm told).

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Note that contributions limits are set for an election candidate or nomination candidate for each calendar year, but candidates for a party leadership – where spending ceilings are likely to be much higher – must raise funds from contributors who can give the maximum only once per leadership contest. [Independent candidates for election to the Commons also face a per-event contribution ceiling.]

The drafting of the above sub-sections seems to make sense on the face of it, but in practice the law is an ass: allowing some candidates to game the system, on the one hand, and making it extremely difficult for honest candidates to cover their debts after the fact, on the other.

Think this doesn't apply to your party? Let me demonstrate:

• Cabinet minister X retires from public office and takes up a job at one of the big five banks. An exploratory committee for some future leadership campaign spends the next five years collecting pledges of $1100 from various friends and colleagues and traditional party donors. In due course, that party's leadership opens up, the pledges are collected, and suddenly it becomes extremely difficult for any other candidate to enter the race.
• A party is in its down cycle, and needs to attract new talent to renew itself. Unfortunately, an old warhorse has tapped the few remaining large contributors for the maximum donation, and newer entrants are effectively frozen out of the race because they can't hire the infrastructure to raise money from new small donors without already having seed money from larger donors.
• [Actually happened:] In the middle of a leadership contest, under a known set of rules, Parliament amends the Elections Act, dropping the contribution ceiling to one-fifth of its previous size. Unsuccessful candidates who had entered the race under the old set of rules, and budgeted accordingly, were suddenly unable to find a sufficient number of donors who hadn't already contributed the maximum to one of the perceived front-runners, in order to pay off their debts.
• An unsuccessful leadership candidate for one party, who is caught in such a squeeze, is approached by someone in another party to step down from his seat, with a promise that a new pool of contributors who support the second party will donate money to pay off his or her leadership debt.

In his report to Parliament on recommended changes to the Elections Act following the 2008 general election, the Chief Electoral Officer recommended that the "per-contest" limit be changed to an annual ceiling, in order to be consistent with the other entities he regulates (national parties, local riding associations, nomination candidates, and party candidates for election to the House of Commons).

I realize some people who understand the current provisions still support them, because they feel leadership contestants ought not to ring up such excessive expenditures in a vain pursuit of their party's leadership, and that such contests should be far more frugal. And, at one level, it's perhaps not hard to criticize a few individual campaigns for over-reaching. But consider: having a healthy ego is an occupational hazard of the practice of politics in the modern always-on age we live in, and we don't really want our leaders to be pessimistic and un-ambitious, do we?

A leadership campaign can be financed through:

• individual contributions, to the per-contest ceiling per contributor
• transfers from either the national party or a local riding association, so long as those transfers are offered on an equal basis to all candidates (see s.404.3(1) of the Act)
• loans, though those loans must be repaid from out of either (a) or (b)

Note that it cannot be financed by the individual candidate, nor can it be funded by the candidate's party or riding association to any greater extent than that offered to other leadership candidates.

Now, should Parliament not see fit to amend s.405(1)(c) to institute annual contribution limits rather than per-event contribution limits for leadership contests, a political party organizing a leadership race could still decide to enforce more restrictive contribution limits on its own candidates.

For example, a party could set a $600 contribution limit for each contestant, regardless of the contribution ceiling in the Elections Act, and/or any spending ceiling the party also decided to put in place. This would reassure unsuccessful candidates that they could still raise funds after the race to pay their vendors and properly dispose of their debts, and thus allow a leadership race to remain relatively open.

Political parties occupy a unique place in our democratic system. They are not direct agents of the state, but at the same time they are more than private social clubs. They are voluntary organizations that have become professionalized and partially regulated by law, and are the chief recruiters, vetters and providers of the candidates we must choose from amongst, when we cast our ballots at election time.

It is in the public interest that political parties be able to attract a wide range of potential candidates during a leadership race, and that viable candidates not be dissuaded from running for fear they will be unable to pay their debts later on, or be subjected to potentially corrosive pressures in order to do so.

Thus, I urge Parliament to consider amending s.405(1)(c) of the Elections Act, at the first opportunity, to change the leadership campaign contribution ceiling from a per-contest one into an annual one, and I also urge the various political parties who will be launching leadership contests over the coming months and years to set rules and spending limits that don't force candidates into impossible situations after the fact.

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Of course, this raises the question of where the 2006 Liberal leadership candidates are at with their fundraising and debt repayments, and Glen McGregor of the Ottawa Citizen noted the other day that Stéphane Dion is continuing to hold fundraising events to pay down his debts.

In fact, most of the latest leadership candidates' returns have just been posted on the Elections Canada website, with the exception of Michael Ignatieff, Scott Brison and Bob Rae, who are all already out of debt and have filed final returns, and Stéphane Dion and Hedy Fry who both requested and were given 30-day filing extensions, as allowed under the judge's order.

The judge ordered that all candidates' debts be paid off by December 31, 2011 (with the exception of Ken Dryden, who has been given until June 30, 2012). After that they have a further 60 days to file their final returns, for which a further 30-day filing extension could also be granted.

Here are the latest figures (as of the candidates' June 30, 2011 returns, unless otherwise indicated).

• $354,120.78 - Ken DRYDEN – [reminder, he has a June 30, 2012 deadline to pay everything off, while the other candidates only have until December 31, 2011]
• $115,000.00 - Martha HALL FINDLEY
• $110,090.00 - Joe VOLPE
• $108,302.47 - Gerard KENNEDY
• $33,164.08 – Maurizio BEVILACQUA
• $77,500.00 – Hedy FRY – [as of Dec 31, 2010]
• $30,000.00 – Stéphane DION - [as of Dec 31, 2010] UPDATE: return now available, figures remain the same
• $0 – Carolyn BENNETT
• $0 – Scott BRISON
• $0 – Michael IGNATIEFF
• $0 – Bob RAE

Note that a large chunk of Mr. Dryden's outstanding obligation is the result of unpaid claims totalling $129K (all but $5K in loan interest), and the one operating loan taken out by the campaign was a $300K loan from Mr. Dryden himself at an interest rate of 5.5%. Thus, he is in the unenviable position of legally having to raise money to pay himself back, or else he would be in violation of s.405(1)(c) if the loan becomes a deemed contribution and puts him over his contribution limit for the leadership contest. He's plugging away at it, but it's going slowly, and it was an $805K campaign that obtained just under 5% of the vote on the first ballot (238 delegates). In contrast, the three top candidates spent some $3M each.

Maurizio Bevilacqua appears to have most aggressively retired his debts since our last check-in, when he owed some $193K.

Note also that the government has several times tabled legislation seeking to further regulate who candidates and contestants may obtain loans from. We can probably expect to see a version of this legislation coming forward at some point in the current Parliament as well.