Last week we had the guilty plea from the Conservative Party confirming that it had violated Canada's election financing law in the 2006 federal election. Today we have the admission from the NDP that it too had broken the law when it invited mourners to honour Jack Layton by making donations to the Ed Broadbent Institute. To its credit the NDP is promising to return the donations without a years-long court battle. Had it not been caught by vigilant observers, the party would have been complicit in donors receiving illegal tax benefits; i.e. political donation tax credits which are far greater than the benefit accrued through reductions in taxable income made possible by other charitable gifts.
That party officials ever thought the plan was legal suggests they see the party and the institute as one and the same entity. It suggests further monitoring to ensure the Broadbent Institute is truly independent and not merely a research arm of the NDP circumventing the rules governing political party fundraising and expenditures. The Canada Revenue Agency will also need to ensure the institute is eligible for charitable organization status and to issue charitable donation receipts.
Expect more cases like these as the Conservatives' proposal to end tax-funded political party subsidies. The pressure will be on parties to find creative ways of generating income and moving expenses outside the tightly regulated sphere overseen by Elections Canada.
