The huge political story in Canada today is that the Commissioner of Canada Elections has (finally) laid charges over the Conservative Party’s campaign spending in the 2006 election.
Four Conservative officials, two who have since been elevated to the Senate, face charges under the Canada Elections Act in the “in and out” affair.
My colleague, Tim Naumetz, and I first starting writing about this in the summer of 2007. So, this has been a long time coming.
Our original reporting on this story relied heavily on data journalism approaches. I’m writing about this here to illustrate the value of data analysis as a technique for covering politics, which is, of course, all about numbers – votes, polls, election finance.
Tim and I used the open-source relational database MySQL to analyze election spending reports to first detect the pattern of cash transfers between the party and its candidates at the centre of the in-and-out affair.
Coincidentally, I’m in Raleigh, North Carolina, this week for a conference on computer-assisted reporting. It’s killing me not being in Ottawa to continue covering this story.
(I find solace knowing that the re-emergence of in-and-out will help me justify to my editors the cost of coming here for more CAR training.)
Here’s a piece I did in 2008 for the Canadian Association of Journalists Media Magazine on how Tim and I first found the in-and-out transactions at the centre of the charges laid last week:
In the midst of a deadly slow August morning in the press gallery on Parliament Hill, reporter Tim Naumetz was looking over a few candidate spending returns from the 2006 federal election.
Every candidate is required by law to file an expense report with Elections Canada. Usually, they are a dull accounting of the costs incurred in running a local campaign– yard signs, phone rentals, pizza parties and the like.
But in this sea of numbers, one line item jumped out at Tim. An unsuccessful Conservative candidate’s campaign had incurred more than $30,000 for “radio/TV” advertising.
Most candidates spend a few thousand dollars for ads in their local papers and some even shell out more for radio spots in their local market. But $30,000 for a single ad buy was highly unusual. And in this case, the supplier of the ad was listed as the Conservative Party of Canada, not a newspaper or radio station.
Why, he wondered, would a candidate pay his own party that much money for ads?
At the same time, one row of desks over from Tim in the Press Gallery “Hot Room”, I was creating a database of election financing records. The Conservative government’s Federal Accountability Act had changed the rules for political donations, and I was curious to see which parties were benefiting from the tighter contribution limits. I had been to several Canadian Association of Journalists seminars on computer-assisted reporting (CAR) and had just finished two long-term projects using electronic records. I was interested in using CAR techniques with political financing records.
Tim brought over a copy of the expense report he was looking at. Was it possible, we wondered, that some parties were trying to bypass the federal limit on campaign spending by getting their candidates to pay for national campaign ads?
We realized that it would be an exhausting task to check each and every return for the more than 1,000 candidates who ran in 2006. Instead, I suggested we create a database of all candidate election returns to find out who else was spending large amounts on advertising.
In most CAR projects, getting data from government involves making an Access to Information request and, often, fighting with bureaucrats for the records. In this case, all the data we needed was sitting on Elections Canada’s website.
We downloaded the records in text format, imported them into the open-source MySQL database manager, and began crunching the numbers. The data showed that dozens of others Conservative candidates had posted six-figure expense claims for broadcast advertising. We sorted the list of candidates based on their broadcast advertising spending and started calling the names at the top of the list.
The first candidate we talked to was a lawyer named Sam Goldstein, who had ran unsuccessfully in downtown Toronto. He described a scheme in which the Conservative Party transferred large amounts to their candidates, who then paid the party for advertising. The ads were not for the candidates, but rather, for national advertising, he explained.
Why would candidates agree to these financial transactions? Because the money flowing through their campaigns boosted their spending and qualified for them from a larger rebate from Elections Canada, Mr. Goldstein said. Candidates who get more than 10 per cent of the vote in their riding are eligible for tax-payer funded reimbursement of 60 per cent of their allowable expenses. It was, Mr. Goldstein said, all legal.
We went back to the database and began looking for other large transfers of money from the party to the candidates. Using MySQL, we were able to quickly compare the transfers the candidates received with against the expenses they claimed for radio or TV advertising.
The results were striking. Nearly a third of all Conservative candidate campaigns had received substantial transfers from the party, then turned around and bought ads from the party. Many paid in advertising exactly the same amount they received in transfers, the data showed.
Together, they had bought more than $1.2 million in broadcast advertising from the party. Had the national party incurred these costs directly, it would have exceeded its $18.3 million limit on spending limit for the 2006 campaign and put the party in serious violation of the Elections Act.
Not only would the transfers and expenses qualify the candidates for larger rebates, they also appeared to allow the party to spend money on crucial broadcast ads outside its national budget. At the very least, it seemed we’d found a loophole in the elections law. At worst, it might be an attempt to skate around the rules.
We spent several more days calling other candidates on our list to confirm what Mr. Goldstein had told us. We also ran the same data analysis on Liberal, NDP and Bloc Quebecois candidates.
Although the other parties all made transfers to their candidates, there was no indication of the same coordinated effort to return money in advertising costs to the federal parties, the data showed.
The afternoon before we were to publish out first story, we made a surprising discovery. A Conservative Party official told us that the transactions we were interested was the subject of a case currently in Federal Court. The court records showed that auditors for Elections Canada had also detected the unusual pattern of transfers and expenses. Like us, the auditors followed up with the candidates and their official agents. These officials had also described the same system to boost candidate expenses. One official quoted in court papers gave it a name — an “in-and-out.”
The court documents showed that Chief Electoral Officer Marc Mayrand had refused to allow the candidates to claim the expenses. The official agents for 34 Conservative had taken Mr. Mayrand to court over that decision, saying the claims for “regional media buys” were proper and legal.
In subsequent stories, we reported that Commissioner of Elections William Corbett had launched his own investigation and could, if warranted, refer the matter for prosecution. We also found e-mails that showed the financial transactions had been orchestrated by a senior party official.
Other reporters began advancing the story, too. Helene Buzzetti at Le Devoir did some excellent work tracking down former Conservative candidates in Quebec who were dismayed by the scheme.
In response to our stories, a House of Commons committee began its own probe of Conservative election financing, but it was dissolved when Parliament was prorogued this fall. The committee is expected to resume its hearings later this year. The federal court case is ongoing but is unlikely to conclude any time soon. Mr. Corbett has yet to report on his investigation and, at this writing, the political fallout of the story is still unresolved.