‘Charity chill’ melts under friendly government
TheStar.com – Opinion/Commentary – Revenue Minister Diane Lebouthillier has a rare opportunity to unlock the potential of Canada’s 85,000 charities.
Jan 20 2016. By: Carol Goar, Star Columnist
One of Justin Trudeau’s first acts as prime minister was to disband Revenue Canada’s anti-charity hit squad.
He made it clear to Revenue Minister Diane Lebouthillier in her mandate letter that he expected her to take it from there: “Allow charities to do their work on behalf of Canadians free of political harassment,” he wrote. “Modernize the rules governing the charitable and not-for-profit sectors, working with the minister of finance. This will include clarifying the rules governing ‘political activity’ with an understanding that charities make an important contribution to public debate and policy.”
Environmentalists, anti-poverty activists, human rights defenders, foreign aid advocates, church workers and altruistic citizens across the country let out a collective sigh of relief. Calvin Sandborn, legal director of the Environmental Law Centre at the University of Victoria, said he was “thrilled by this reversal of policy.”
For most political observers, that was the end of the story. They ticked off one item on Trudeau’s long list of promises and moved on.
But Lisa Lalande of the University of Toronto’s Mowat Centre took a deeper look. She wanted to see — and perhaps help shape — the followup to the prime minister’s good-faith gesture. She brought 20 years of experience in the non-profit sector, the advice of her former peers and her research into the reforms other countries had made. Her report, On the Mend: Putting the Spark Back into the Government-Charitable Sector Relationship, is now publicly available.
Lalande gives the Liberal government credit for thawing the “charity chill” that seized the voluntary sector four years ago when former PM Stephen Harper created a special team of auditors with a budget of $13 million to scrutinize the activities of charities that questioned or spoke out against his government’s policies.
But that’s just the first step, she maintains.
Revenue Canada’s rules for charities are vague and confusing. A charity must limit its political activities to 10 per cent of its resources to maintain its tax-exempt status and issue official donation receipts. But there is no clear definition of a political activity. This leaves charities guessing or retaining tax lawyers to be safe.
Federal regulators see charities as boundary-pushers, not problem-solvers, not contributors to public policy, certainly not partners of the government. They enforce the rules without looking at the bigger picture. They penalize deviators regardless of their intentions or the services they provide.
“A shared vision of the (non-profit) sector’s purpose and clarity about what constitutes an effective partnership (with the government) are necessary to develop coherent policies,” Lalande says. Charities need fewer, not more, bureaucratic constraints. They need a legislative framework that bolsters their efforts to support vulnerable Canadians.
“Policy-makers don’t need to reinvent the wheel,” she says. Several provinces — including Ontario — have embarked on reform initiatives. Non-profit leaders have done a lot of brainstorming about how to strengthen their sector. And countries such as Australia, New Zealand and Britain have already modernized their regulatory regimes.
Britain and Australia have created independent public agencies to rewrite the rules and monitor the activities of charitable organizations. The U.K. Charities Commission, for example, allows political activity provided it is part of a “wider range of activities aimed at furthering the organization’s charitable purposes.”
The Supreme Court of New Zealand has placed no limit on political activity as long as its purpose is charitable and it “provides benefits to the public or a sufficient section of the public, not just an individual, an organization or a closed group.”
None of these models fits Canada. With shared federal-provincial responsibility for the non-profit sector, Lebouthillier will have to create or adapt her own framework. That might mean establishing an arm’s-length agency to regulate charities; issuing new marching orders to the 270 officials in Revenue Canada’s charities directorate, or coming up with a made-in-Canada hybrid.
“The charitable sector is ready for — and in need of — change,” Lalande says. Circumstances are as good as they’re ever likely to be: a new minister with a long history of charitable involvement; a government that understands the importance of voluntary organizations; a wave of goodwill toward Syrian refugees; and a desire to cast off the secrecy and excessive partisanship that permeate Ottawa. “Now is the time to work collaboratively to empower and protect the sector while strengthening its ability to work for the public benefit.”
Trudeau has seized the moment. Lebouthillier’s task is to work with Canada’s 85,000 charities to unlock the potential of an army of willing volunteers and donors.
< http://www.thestar.com/opinion/commentary/2016/01/20/charity-chill-melts-under-friendly-government-goar.html >
Tags: ideology, participation, philanthropy, tax
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