Canada PM sets stage for fight over vote subsidies

* Cutting subsidies would help ruling Conservatives

* Move to scrap public cash provoked crisis in 2008

* Liberals say Canada PM wants U.S.-style politics

By David Ljunggren

OTTAWA, April 1 (Reuters) – Canadian Prime Minister Stephen
Harper said on Friday that if he wins the May 2 general
election decisively he will eliminate public subsidies for
political parties, an explosive issue that almost brought down
his government in late 2008.

The move would help Harper’s Conservatives by financially
crippling opposition parties, which are less efficient at
raising money and rely on public cash to stay afloat.

Polls show the right-of-center Conservatives will win the
election and might even capture a majority of seats in the
House of Commons, a feat that eluded them in the 2006 election
that brought them to power and in a subsequent election in
2008.

The Canadian subsidy system gives each major political
party C$2.00 ($2.06) per year for every vote it received in the
previous election.

Harper said that if he wins a majority, he will move to
eliminate the subsidy within three years.

“Taxpayers shouldn’t have to support political parties that
they don’t support,” he said in Moncton, New Brunswick.

“(It’s) this enormous check that keeps piling into
political parties every month, whether they’ve raised any money
or not, that means we’re constantly having campaigns. The war
chests are always full,” he told reporters. The May 2 election
will be Canada’s fourth in less than seven years.

The Conservatives received C$10.4 million in 2010 in
subsidy cash while the main opposition Liberal Party picked up
C$7.3 million.

Corporate and union donations are banned and individuals
are allowed to give no more than C$1,100 a year. In the last
quarter of 2010, the Conservatives raised C$5.2 million from
the public, compared with C$2.2 million for the Liberals.

In November 2008, shortly after retaining power in the
October election, the Conservative government moved without
warning to scrap the subsidy.

The three opposition parties united in a bid to bring down
Harper in the House of Commons, and he only escaped by having
Parliament suspended.

Liberal leader Michael Ignatieff said Harper’s announcement
on Friday revealed a plan to introduce what he called
U.S.-style attack politics to Canada.

“We have a democratic system at the right price — it’s
economical, it creates a level playing field … if he wants to
attack it he will face the resistance of all parties,” he told
reporters in London, Ontario.

“Do you defend Canadian democracy or do you want to import
American-style democracy into this country? I don’t think so,
because you get big money, you get corruption, you get all the
problems that bedevil American democracy,” he said.

The opposition left-leaning New Democrats said the system
worked fine as it stood, while the separatist Bloc Quebecois
said Harper’s plan was undemocratic.

($1=$0.97 Canadian)
(Reporting by David Ljunggren; editing by Peter Galloway)

Canada PM sets stage for fight over vote subsidies