A little help would go a long way

TheStar.com – Opinion – A little help would go a long way
December 12, 2008. Carol Goar

As the first winds of the recession bite, Canadians are still giving, mindful that this will be a bleak Christmas for many.

But corporate donations have fallen off sharply. And grant-making foundations, weakened by the financial meltdown, have retrenched. Some have suspended their charitable activities to protect their endowments.

This means students can’t get scholarships, medical researchers can’t get funding, arts groups can’t pay their bills, and social agencies can’t respond to the rising level of need.

It is too early to assess the damage, but the voluntary sector is hurting and the people who depend on it are scared.

Canada’s network of 80,000 charities is seldom mentioned when politicians and economists talk about shoring up the nation’s “infrastructure.” But the invisible lattice that underpins communities and supports people in need is as important as the physical grid that keeps traffic moving, commerce flowing and utilities working.

It is true that building roads, bridges and transit lines creates jobs and contributes to future growth. But so does upgrading workers’ skills, opening child-care centres and tackling intergenerational poverty.

It is true that construction projects pump money into the economy and keep people spending. But so do non-profit activities, from medical research to community theatre.

It is true that the auto industry, which employs 155,000 people, is a pillar of the Canadian economy (albeit a shaky one). But so is the non-profit sector, which employs 1.2 million Canadians and provides meaningful work for 12 million volunteers.

Unfortunately, no one has made this case effectively.

Last month, Imagine Canada, which represents the voluntary sector, sent a letter to Prime Minister Stephen Harper urging him to maintain existing levels of funding (roughly $7 billion) to charities and non-profit organizations.

If the government follows this advice, Canada’s social infrastructure will surely deteriorate, as corporations cut back further, foundations wait out the market turbulence and individual donors tighten their belts.

The reason the group asked for so little, said Marcel Lauzière, president of Imagine Canada, was that its leaders feared Finance Minister Jim Flaherty would slash Ottawa’s grants and contributions to non-profit agencies in his Nov. 27 fiscal update. He made no such move.

Since then, Imagine Canada has adopted a new strategy. It is now urging the government to invest in social housing and provide more resources to non-profit organizations to meet the surge in demand the recession will bring. “We want to position this within the economic stimulus logic,” Lauzière said. “We have a capacity to be active on the ground.”

But the group’s slow reflexes and blurred message have put it at a disadvantage.

Moreover, Philanthropic Foundations Canada, which represents the country’s 9,000 foundations (half public, half private), is split. Some of its members think their first obligation is to preserve their donors’ capital in the face of massive stock losses. Others believe that slashing their grants is a violation of their core purpose.

To complicate matters, there appears to be a discrepancy between Ottawa’s requirement that foundations give away 3.5 per cent of the value of their holdings and provincial regulations designed to protect endowments.

For all these reasons – plus the fact that many charities are swamped right now – no one has offered the government clear, concrete suggestions.

Here are a few ways Ottawa could help:

1.) Offer more generous tax breaks for charitable donations (the current tax credit is 15.25 per cent for donations up to $200 and 29 per cent after that).

2.) Work with the provinces to set clear, non-restrictive rules for foundations.

3.) Provide more resources to non-profit organizations.

4.) Increase provincial transfers (it currently provides $33 billion for health, education and social programs) to alleviate the pressure on voluntary organizations.

5.) And recognize charities for the vital role they play in keeping people from hitting rock bottom in hard times.

Canadians are reaching into their pockets and purses to help, despite their anxiety about the future. If their government can’t lead, it can at least follow.

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