Thank you, Mr. Chairman, members of the committee.
My name is Teri Kirk and I am the Vice-President, Government Relations and Public Policy, Imagine Canada. I am pleased to make this submission on behalf of Imagine Canada and the 13 other agencies listed on page one.
Our purpose in so doing is to draw the committee's attention to the sector's views on the impact of Part I of the bill which concerns the administration of grants and contributions, as well as of Part 3, which concerns the contracting process.
I'm going to divide my comments into three parts. I'd like to start with a brief overview of the community non-profit sector and of Imagine Canada. I'd then like to address four issues in the bill that are of interest to our sector: grants and contributions, procurement, sector infrastructure, and a government accountability framework for the sector. Finally, I'd like to take a minute to express the sector's appreciation for several recent initiatives.
The community non-profit sector is quite large and complex. Included in your materials is a pictogram; the sector is often depicted as a pyramid. You'll see that at the top of the pyramid there are about 161,000 incorporated organizations in the sector; 80,000 are non-profits, and another 80,000 are registered charities. The difference is that registered charities can issue tax receipts for donations. There are close to another one million unincorporated organizations existing in Canada at any particular time. They rise up to support victims of crime, for example, or to host events in communities. Forming the base of the community non-profit sector, there are about six and a half million Canadians who volunteer their time, representing about 30% of Canadians.
I've also included a breakdown of the types of activities the sector participates in. I'm sure that individuals around the table are very active in their communities and will find this of interest. You'll note that about 50% of the organizations forming the community non-profit sector are involved in sport, religion, and the delivery of social services. You get a sense of the size of the sector when you see that hospitals, universities, and colleges together represent only 1% of the sector, whereas organizations delivering social services are about twelve times the size of our national hospitals, universities, and colleges. In terms of its economic strength, the sector employs over two million Canadians. In terms of paid employment, this makes it larger than the manufacturing sector, and it accounts for about 7.8% of GDP.
Imagine Canada is the largest intermediary organization in the sector and has over 1,100 members. It was created about two years ago as the result of a merger of the Canadian Centre for Philanthropy and the Coalition of National Voluntary Organizations to provide one strong national voice for the sector.
Imagine Canada is a bit unique within the community non-profit sector in that it works closely with business and government as well as the sector itself to support community-based organizations. It works with business through our imagine caring companies program. This is a program whereby companies commit to giving 1% of their earnings before taxes back into the community. All of Canada's large banks and the leaders in the oil and gas sector such as EnCana, and leaders in telecom such as Bell Canada, are involved in the program. As you can imagine, committing 1% of their pre-tax earnings into the sector represents a very significant amount of money.
Let me turn now to the four issues in the bill that I'd like to bring to your attention. The first relates to grants and contributions under part 1 of the bill. I would just like to underscore the extent to which the flow of Gs and Cs are of paramount importance to the sector. Federal government grants and contributions are frequently the single largest source of funding for many of these organizations, and across the board they account for 7% of all funding into charities and non-profit corporations.
The web of rules associated with compliance under federal Gs and Cs unduly strains the capacity of these organizations and imposes an administrative burden that is often wholly disproportionate to the amount of the grant or contribution or the capacity of a typical recipient organization to comply with. Examples of this are legion.
We support the government's commitment to recalibrate the administrative demands under the federal G and C processes and to focus more on outcomes, and we support the striking of the blue ribbon task force under the accountability action plan.
With respect to procurement, the sector supports the inclusion of fairness, openness, and transparency in respect of procurement under part 5 of the act, but we echo the views of umbrella groups representing small and medium-sized enterprises in expressing concern that the proposed consolidation of the government's purchasing power will tend to result in contracting practices that greatly favour large enterprises over small and medium-sized businesses and small and medium-sized organizations. We are concerned that indeed such a level of consolidation might in fact breach the fairness principles to be enshrined in the act.
The third point relates to what I've called sector infrastructure. That is really the capacity of organizations to sustain themselves over time and to undertake activities such as long-range planning, facilities maintenance, investment in information technologies, and even paying directors and officers insurance to attract the boards and to carry out the community service programs that are at the heart of what the community expects them to do.
While we very much applaud the efforts to streamline the flow of grants and contributions, to ensure that the principles of fairness are maintained under procurement, and to see that small and medium-sized enterprises and organizations are reflected, these really represent improvements or fixes to current funding regimes that have become very short term and constrained and do not address the long-term stable funding needs of the sector. The result has been a very continual erosion of sector infrastructure.
We are asking that government consider, in addressing grants and contributions, that the need for longer-term and more stable funding models must apply.
We recognize that long-term funding for our sector is probably beyond the scope of the Federal Accountability Act and the action plan of this committee, but I will include some recommendations at the end of my comments about some alternative measures we would ask the committee to consider.
Finally, I would like to raise the merits of a government accountability framework vis-à-vis this sector. In 2001, efforts were made along that line; the government and the sector signed the accord between the Government of Canada and the voluntary sector, which led, in turn, to the adoption of two codes of good practice: a code on funding and a code on policy dialogue. Together these three documents form an effective government accountability framework for our sector.
Nevertheless, the documents were voluntary in nature. Service Canada serves as an example of one that has very much taken up and observed this accountability framework, whereas other departments have virtually no knowledge of, or real willingness to comply with, the accord and codes.
So we are asking that this government reassert its commitment to an accountability framework between the government and the sector. We think it can be quite easily done by taking the existing accord and codes and perhaps updating them somewhat as required, and reissuing them as part of the accountability action plan.
Let me conclude my comments with two compliments and several recommendations. We'd like to compliment the Government of Canada on its striking of a blue ribbon task force on grants and contributions under the action plan and on the enshrining of the principle of fairness in respect of procurement under the act.
Our recommendations are as follows: in respect of grants and contributions, we recommend that the Government of Canada recalibrate the burdensome impact on the community non-profit sector of the web of rules embedded in the federal grants and contributions process and refocus on outcomes that are more consistent with the sector's mandate to its donors, to its volunteers, and to the communities that depend on them.
We would ask that the government ensure implementation of the recommendations in the Auditor General's most recent report of May 2006. In chapter 6 of that report she addressed the need for streamlining of grants and contributions.
Finally, we would ask that the government empower the blue ribbon task force to broadly address the need for long-term funding as well as fixes to the grants and contributions process.
On procurement, we recommend that the government enshrine the fairness, openness, and transparency provisions, but be cognizant of potential inconsistency in consolidating procurement and whether that is consistent with the principles of fairness vis-à-vis SMEs and SMOs.
On sector infrastructure, we encourage the committee to put forward some recommendations that the issue of longer-term and more stable funding is required if we're going to have a vibrant community non-profit sector. We do have one of the strongest sectors in the world, but it has been very significantly eroded over the last decade with the erosion of long-term funding models.
Recommendations that you may wish to consider include striking a parliamentary committee with a mandate to look at the long-term funding issues; establishing an endowed national foundation, similar to perhaps the Wild Rose Foundation in Alberta or the Ontario Trillium Foundation, that could supplement the grants, contributions, and contracts regime with a national infrastructure funding program for the sector; implementing the Auditor General's report; and ensuring that the blue ribbon task force mandate is sufficiently large to address the longer-term funding issues.
Finally, as to the government accountability framework, we ask that the government adopt the accord between the Government of Canada and the two codes of good practice, and reissue them on behalf of the Government of Canada as a whole, as part of Treasury Board guidelines.
Those are all my comments. I welcome any questions you may have.
