Harper War Chest Give Conservatives Edge in Canada Vote

Prime Minister Stephen Harper gave his party a leg up in Canada’s election by more than doubling spending limits after amassing a campaign war chest bigger than that of his two main rivals combined.

Harper triggered the longest campaign since 1872 on Sunday, allowing his Conservatives to capitalize on the funding advantage over the Liberals and New Democratic Party, thanks in part to a law his government passed last year.

The 79-day campaign, twice as long as the minimum required, comes with an increased spending cap of C$54.1 million ($41 million) for each party. The Conservatives ended 2014 with almost C$31 million in their coffers, including national and riding-level funds, compared with about C$17 million for the Liberals and C$10 million for the NDP.

“They obviously created a situation that they felt would provide an advantage to their party,” Jeremy Broadhurst, national director of the Liberal Party, said in an interview.

The Conservatives’ deeper pockets were on display from the start as Harper boarded his campaign bus and headed to Montreal for a rally Sunday. By contrast, NDP Leader Tom Mulcair and Liberal Leader Justin Trudeau delivered brief remarks but opted against launching full national tours until later in the month.

While campaign spending in Canada is a far cry from the U.S., where parties spend 10 times as much per capita, this still shapes up to be the costliest campaign ever ahead of the Oct. 19 vote.

Parties and candidates spent C$115 million in the 37-day 2011 campaign, with each national party facing a cap of C$21 million, elections records compiled by Bloomberg show. This time, with a longer campaign and new seats added, each party faces a $54.1 million cap. With candidate spending included, that increases to C$127 million per party.

Taxpayer Funds

Elections Canada also reimburses half of eligible national party expenses, and 60 percent of eligible candidate expenses. The reimbursements totaled C$60 million in taxpayer funds in the 2011 election and are poised to soar this year.

They could exceed C$200 million if all three major parties and their candidates maximize spending, though chances of that are slim due to strict donation limits in the country. Canadians can give only C$3,000 in total to a party, its candidates and local riding associations in 2015, and corporate and union donations are banned.

Though reimbursements will increase, the Conservatives did phase out a subsidy paid to parties based on the number of votes they receive. Having earned the most votes in 2011, the Conservatives would have raked in more money than opposition parties had they kept that subsidy in place.

U.S. Comparison

Both the NDP and Liberals criticized the longer campaign, with Mulcair’s party saying Harper rewrote election laws to benefit his own party.

Harper defended the longer campaign and made no apologies for his financial advantage. A longer campaign prevents lawmakers from essentially campaigning on public funds, he said.

“What we do by calling this campaign is making sure we are all operating within the rules and not using taxpayers’ money directly,” he said.

Even as it creeps upward, Canadian spending still pales in comparison to the cash that flows in U.S. campaigns. Between 2011 and 2012, presidential candidates, congressional candidates, party committees and political action committees spent $7 billion, or $22 per capita, compared to about $2.60 per capita in Canada for its 2011 campaign.

Pro-Rated Increase

The new spending limits -- which increase on a pro-rated basis for each day added to a traditional 37-day campaign -- were among the changes enacted last year in a law the government called the Fair Elections Act. Critics said the legislation’s effect was just the opposite.

“The unfair elections act was designed to give him a leg up,” labor leader Jerry Dias said of Harper. “It’s all about money buying the election, and there’s no question the Conservatives have a heck of a lot more money than the NDP and the Liberals.”

The Conservatives are continuing to lead the pack in fundraising this year, pulling in C$13.7 million in the first six months, compared with C$7.9 million for the Liberals and C$6.8 million for the NDP.

Third-Party Ads

In addition to increasing the spending limit, a longer campaign puts a clamp-down on third-party advertising.

Unifor, the 315,000-member labor union led by Dias, is among the backers of Engage Canada, a collection of “progressive” groups that are running advertisements against Harper -- including a television and radio blitz that began a week before the first leaders debate in Toronto on Aug. 6. That advertising will stop now that the election has formally begun.

“Engage Canada has no plans to be active during the writ period,” spokeswoman Jessica Hume said in an e-mail.