Finance Committee on Feb. 14th, 2012

[The Chair, Conservative, James Rajotte]

I'm sorry, Mr. Adler. We're over time.

I'm trying to be fair to all members. I'm sorry, to the two witnesses, but I have to be equal to members. It's only fair.

We'll go to Monsieur Giguère, please.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Thank you very much, Mr. Chair. My first question goes to all the witnesses.

In my constituency at the moment there are three food banks. They are essential because we have poor people, elderly people, students and people who, after four years of the economic downturn, are not able to afford proper groceries at the moment. I see a problem. In terms of charitable donations and tax credits, all charitable organizations are treated in the same way.

I would like to know what you think of the idea of a rate that would vary according to the urgency of the situation to which a charitable organization is responding. Think of meals on wheels services, for example. I know CEGEP students who need them in order to be able to pay their tuition fees and their accommodation and living expenses.

That was a general question.

[The Chair, Conservative, James Rajotte]

We'll start with Mr. Hutchinson, and then, Mr. Bird, if you want to comment on this, I'll give you the second chance.

Mr. Hutchinson.

[Don Hutchinson]

That's an excellent question.

Thank you, Mr. Chair.

The pressure food banks are facing is the increasing number of people and the decrease in donations.

Encouraging corporate sponsors—and more and more corporate sponsors are coming forward and contributing substantial amounts of food—in addition to people who are giving financially, would be tremendous.

I don't know how confusing a variable rate of donation would be, but I think what we've seen in the international sphere, where there have been government matching programs on donations, could work with trying to develop corporate matching programs in communities or government matching programs for emergency needs within the country, not just outside of the country.

It's my thought. It's not something I've studied. It seems you've come up with a terrific concept.

[The Chair, Conservative, James Rajotte]

Okay.

We have Mr. Bird and then Mr. MacDonald.

[Ian Bird]

It's a good question.

The experience we've had is that isolating particular elements and challenges in a community may mean we overlook the whole experience and the interconnections of community life. I think we're having a good discussion here around the table about this sort of decline in civic involvement, this decline in the civic sensibility, and some of the cultural components to this. What we see at Community Foundations is in fact that some of the activities that we go on, which may look like they don't have an impact on the food security of a particular family, in fact have a very important connection. It could be their involvement in a faith-based institution, it could be their involvement in a community recreation opportunity, or it could be their involvement in another part of the community that builds and bridges their connections at the community level.

In our perspective, a good public policy is one that looks at the whole community and would provide an opportunity that would allow that community to identify its priorities and benefit as a result.

[The Chair, Conservative, James Rajotte]

Mr. MacDonald.

[Bruce MacDonald]

I think there was an interesting term that you used in terms of urgency. I think one of the challenges I could see in thinking about that question is this: how do you define one being more urgent than the other?

I agree. I think the voluntary sector, the charitable and non-profit sector, has a wide range of offerings to make Canada a better place. I think we could have a really long and perhaps never-ending debate over the value of a service that needs to be provided immediately versus one that has a long-term transformative nature. And if we say we're potentially going to give a priority of one over the other, if you use urgency as a benchmark, it could be a really interesting and potentially messy debate.

[The Chair, Conservative, James Rajotte]

Mr. Giguère, you have 30 seconds left.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

I just have one very quick question.

At the moment, donations under $200 and donations in excess of $200 are treated differently by the tax system. Of course, for someone who earns $60,000 a year, $200 is not a big deal. But for someone who earns only $20,000 a year, it's a significant amount. Are you in favour of having just one rate, whether the donation is less than $200 or more than $200?

[The Chair, Conservative, James Rajotte]

Is there one response to this?

Mr. Bird.

[Ian Bird]

Our response is that we think this invitation to Canadians that the stretch tax credit provides will enable those who may not have given anything at all to then benefit from a tax incentive provided by their government, and that would open up a whole new pool of donors. Mr. Julian asked the question, and Parliament's own budget officer has done some of the research to identify some 600,000 new donors that this might bring into the system.

That would be our perspective.

[The Chair, Conservative, James Rajotte]

Thank you. Merci.

We'll go to Mr. Van Kesteren, please.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Thank you, Chair.

Thank you all for appearing before us here this afternoon.

I want to go in another direction. We had a witness here last week, Dr. Paul Reed, who told the committee in his brief, and I quote:

One of the dominant reasons Canadians give for not contributing, or not contributing more, to charitable organizations is that they already support the provision of community and social services through already paying considerable, and rising taxes.

I'm curious. We've endeavoured, as a government, to partner up in areas like CIDA, when there was a need. I'm going to take this back to the community, but abroad, which is much of the charitable giving that all of your organizations are involved in, we have found it very popular, and when the government makes the request or gives the challenge, Canadians respond favourably. I would suspect—and I think you would all agree too—that taxes are levied and we really have no say. With charitable giving, now we have a choice about where we are going to put our money.

I wonder if maybe you, Mr. Bussey, could first tell the committee how important those types of endeavours are, and then maybe, if you've ever thought about how we could expand that to the community—say we do a lot of social housing and we could start to partner up, much as we do with NGOs in other countries.

I'll start with you, Mr. Bussey.

[Barry Bussey]

You are referring to the CIDA experience?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

We'll talk about Haiti and the tsunami in Japan prior to that, but any time there's a catastrophe, an earthquake, or something, we offer that to the Canadian people.

[Barry Bussey]

Certainly in our membership, we have a number of development agencies and so forth around the world, and people respond to the crisis of the day, as it were, in which the churches and the church organizations are able to get involved. We think of MCC—that's the Mennonite Central Committee—and like organizations, and we find that as a community, as a faith-based community, when we see these international needs, people certainly give even though they are already giving to their local churches, but to the international needs and so forth, they go forth.

I am not sure I fully understand your question. What is it exactly?

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

These proved to be quite successful. Have you thought about those types of projects within the community? I suggested housing, for instance.

[Barry Bussey]

Of course, the problem with the church-based community, which we are, is that we struggle with our definitions fitting under advancement of religion, so we have to be careful when we get involved in social enterprise activities. Currently, the requirement is that if we are involved in those things, it has to be incidental to the advancement of the religion.

One of the projects, for example, the MCC uses is the thrift store. They're able to get involved because 90% of their staff are volunteers, but that makes it very difficult for them to maintain that staff and so forth. It takes a lot of effort. The church community is very much interested in doing more social enterprise, but they are very concerned about their status with CRA in doing so.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

Can you just comment on that very quickly—

[The Chair, Conservative, James Rajotte]

You have 30 seconds.

[Dave Van Kesteren, Conservative, Chatham-Kent—Essex, ON]

—and maybe talk about why the tax issue is so important. Why, when we're taxed more, people seem to give a little bit less. Maybe you could just mention that as well.

[Michael Van Pelt]

The question you're getting at is the question of leverage. The Globe and Mail recently did some great research on this. I encourage you to look at it. They estimated that for all charities, except for your big universities—so taking out universities and hospitals, etc.—43% of their revenues are through government. Then the question becomes how you fill in and how you leverage. We're dealing with that at Minister Finley's advisory committee, the struggle at HRSDC about how we leverage funds.

What's interesting is that if you pulled away the organizations that get no government funding, I suspect it would move into the 60% area, and that's a fearful percentage. The question for you as a parliamentarian then becomes where the dollar amount itself can most effectively and productively be used. I would suggest in some cases—but not in all—there is a role for government in many of these spaces. One is mental illness, for example. There are so many illustrations about how mental illness and being able to deal with mental illness need integrated community involvement rather than just government services to be delivered effectively. That's a great example of how to be able to provide that service. You have to have a much better leveraged effort than what we have currently.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Van Kesteren.

We'll go to Ms. Sims, please.

[Jinny Sims, NDP, Newton—North Delta, BC]

Thank you.

First of all, as others have done, I want to thank you for coming to make your presentations.

I've had the privilege of working with a number of groups, definitely through the Boys and Girls Club. I'm always impressed with the work that comes out of the Suzuki Foundation and the faith groups that are absolutely instrumental in providing much needed support in communities right across...but specifically in my community of Newton—North Delta. There, I would say, whether it's the church, the mosque, the mandir, or the gurdwara, I'm really impressed with the work by the faith community to fill a gap that is ever growing. It's no surprise to anybody. All of us know that the gap between the rich and the poor is growing in Canada.

As I sat here and listened to all of your presentations, something that struck me was that when you hold charitable status—and you may be a food bank, an evangelical organization, or the Boys and Girls Club—you're dealing with a lot of things that are happening in our communities that are there because of public policy, and the best way to address those is through public policy.

Yet I heard that there is some feeling of trepidation about engaging in public policy or advocacy. I see advocacy as engaging in a way to effect changes in public policy. If that were to happen or if you're feeling that, how is that going to impact the work you do right now? Will you then become just a place where people go for a meal, and will you then not be able to do the kind of work you need to do to have a national poverty reduction plan, let's say, which we know is very much needed?

I want to know how those kinds of rumours or things we hear out there about cuts to some charitable advocacy work could impact the work you do right now.