Mike Allen and Donald Scott show us why more changes needed to Alberta Elections Accountability Act.

We all know about the Katz donation(s) and many of us are aware of numerous examples of illegal donations received by the PC party, with the most recent example being tax dollars that appear to be funneled to the PCAA through Lynn Redford, the premiers sister. But how many of you know about the loophole that allowed an end run around the rules by Mike Allen and Donald Scott during the last provincial election?

Section 17 (B) (ii) of the ELECTION FINANCES AND CONTRIBUTIONS DISCLOSURE ACT reads:

(Limits on contributions in any campaign period)

(ii) $2000 to any registered candidate, and $10 000 in the
aggregate to the registered candidates of each
registered party.

This $2000 limit includes candidates own funds which they use for their own campaign as stated in 17 (5):

(5) Any money paid during a campaign period by a candidate out
of the candidate’s own funds for the purposes of the candidate’s
campaign, including the payment of the candidate’s deposit under
section 61(1)(e) of the Election Act,
(a) is a contribution for the purposes of this Act, and
(b) shall be paid into a depository of the candidate on record
with the Chief Electoral Officer.

It sounds straight forward: The maximum allowable amount that candidates can donate to their own campaigns is limited to $2000. The spirit of the law is good as it levels the playing field and is in place to prevent wealthy individuals from the advantage of funding their campaigns out of their own pocket. But the problem is not with the spirit of the law, it is with the letter of the law.

The loophole.

During the election campaign both Mike Allen and Donald Scott contributed the $2000 maximum allowed to their own respective campaigns, as most candidates do, but they also did something that no other candidates did during the election campaign; they donated the maximum $2000 to each others campaign.  Think about that for a moment; the quid pro quo of you donate the maximum to me and I donate the same amount back to you, results in nothing other than essentially allowing each party to use $4000 of their own money towards their individual campaigns with the added benefit of a healthy tax deduction in the process. If it wasn't required for the tax receipt or election paper work, even the formality of giving each other a $2000 cheque wouldn't really even be necessary, take $2k out of your own account and just call it even, because that is all it is.

 Now take this loophole a step further and find 4 other candidates (5 in total) and do the same thing (remember max allowed is $10,000 total to individual candidates) and voila, you have just found a way to donate $10,000 of your own money (5X the stated limit) to your own campaign. Considering how many candidates did not even come close to spending $10K in total on their campaigns this becomes a definite advantage to wealthy candidates.

Does this sound transparent or even close to the spirit which the law intended? 

Why have a limit at all if it can so easily be ignored?

Did Allen and Scott do anything wrong? No, these are the existing rules and they, the only 2 candidates in Alberta to do so, merely found a creative way around them, but if this loophole is not fixed I can guarantee you that come next election that there will be a lot more than 2 who will use this same loophole. And that applies to all parties, not just the PCAA.

The government has a chance to fix this, and some of the many other known issues, with their Election Accountability Act. The question though is: will they do so?

Based on the record of the Redford government so far, I highly doubt it.