The government has been telling Canadians there is no secrecy and no fund, and that in any case, all spending by political parties is subject to utmost scrutiny by Elections Canada.
But in an exclusive interview with CBC News, former elections chief Jean-Pierre Kingsley says Elections Canada simply has no way of knowing how political parties spend the millions of dollars they collect each year from donors and taxpayers.
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"There is nothing that Elections Canada imposes on political parties concerning their expenditures between elections," Kingsley says.
Conservatives are adamant that no party money was used in the now infamous $90,000 Wright-Duffy deal to repay the senator's improper expense claims.
But Canada's former chief electoral officer is equally clear that party funds could be used for just about anything without Elections Canada ever knowing about it.
Kingsley was asked who in Canada provides the oversight of spending by federal political parties. He replied: "The political parties."
All federal parties are required to submit an audited annual statement of total income and expenses.
But those millions of dollars of expenses are only reported as totals in broad categories such as salaries, travel, advertising and even "other."
And Kingsley says Elections Canada can't check any of it.
"There is no verification whatsoever."
The current head of Elections Canada, Marc Mayrand, has made exactly the same point to MPs at hearings of parliamentary committees since 2010, saying the agency essentially has to accept whatever information political parties provide in their respective annual filings.
"I don't have a way of verifying specific expenditures," Mayrand told one Commons committee last month. "I don't have access to receipts or invoices."
On CBC Radio's political show The House, Conservative MP Chris Alexander claimed Elections Canada limits how party funds can be spent.
"There are absolutely rules," Alexander said. "It has to be an event that relates to party activities. Elections Canada has very meticulous, very detailed rules."
Once again, Kingsley says: Not true.
"There are no rules of any kind," Kingsley says. "There is nothing in the Canada Elections Act that prevents a party from spending money as it wishes."
NDP calls for investigation
The New Democratic Party recently wrote to Elections Canada, asking for an investigation of the secret PMO fund.
But Kingsley says the agency can't do that, either. According to Elections Canada's mandate under existing law, "that authority does not exist."
Both Kingsley and Mayrand have repeatedly asked Parliament for increased powers to be able to force political parties to open their books.
After all, Kingsley points out, public subsidies to political parties and generous tax rebates to their donors mean Canadian taxpayers are providing tens of millions of dollars a year to these organizations for everything from attack ads to prime ministerial travel to, well, who really knows what?
"Do we care how that money is being spent? That is one question people might want to ask," Kingsley says.
The former elections head says appeals to political parties to open their chequebooks to public scrutiny have consistently fallen on deaf ears.
Says Kingsley: "It is a deep engrained feeling that parties are entitled to make these decisions unto themselves, and I suspect that they made the decision that they would rather face the scandal than face the consequences of openness."