Finance Committee on Feb. 14th, 2012

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I hope that comment doesn't come off my time, Mr. Chair.

I'm interested in the transparency of non-profits and, generally, organizations that don't have to pay taxes and the transparency they show to the people who donate. In particular, I'm interested in the Independent Sector in the United States. Is anybody familiar with that organization? The Independent Sector is approximately 600 organizations that set mission statements and a hundred best practice guides. Nobody's familiar with them...?

Well, I won't go into that, then, but what I am interested in is what's happening in the United States compared to what's happening in Canada. We heard from the CRA earlier during this study that we have some transparency on the CRA website, and in particular the 10 highest-paid staff positions, not the particulars of the names, etc., but just a general guide of where people are paid and what amount they are paid, not specifically but within $10,000. Also, there's no disclosure of the 10 highest-paid contractors.

Now, I heard evidence recently in the natural resources committee that in the United States they actually publish the 10 highest-paid staff members, including their names, and the 10 highest-paid contractors of those organizations, including their names. My understanding from the evidence we heard that day was that they actually have much more transparency in the United States in relation to not only where the money is going for each organization, but where it's coming from.

Is that your understanding as well? Anybody?

[Ian Bird]

I'm sorry. Is it our understanding that there's a difference between the regulatory environment in the United States and in Canada?

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Yes, in particular that transparency for taxpayers in the United States is much more transparent than it is in Canada.

[Ian Bird]

Well, I think there's a series of efforts under way meant to increase transparency in Canada. I do believe that CRA is actively involved in those, and those are well advised. In fact, it's something that's held in common right across both the foundations and the charities around their own activities. I think the movement towards transparency is well advised.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

In fact, I was looking at best practices. Accountability and transparency were what is seen by most publishers on the websites as a key to keeping non-profit sectors on course. Would you agree with that?

[Ian Bird]

Indeed, the blue ribbon panel your government put in place really had this in mind. And there has been a real incentive by leading organizations, such as Imagine Canada, to see the implementation of the blue ribbon panel's recommendations. The work at Treasury Board and also within the line departments is a key part of that. This provides an opportunity for CRA to ensure that its efforts are also in line with the rest of the government. We were in an earlier discussion about leverage and the opportunity for matching funding. This is something your government is actively involved with already. Canadian Heritage is providing incentive grants, as we've heard, and CIDA is doing the same thing.

That environment, if it's strengthened, upon the recommendations of the blue ribbon panel, would create more impact in communities, because the investment of the Government of Canada could be aligned with the kinds of investments that come forward from Canadians through gifts earned through activities like the ones Barry was talking about. I think your efforts to encourage the adoption of the blue ribbon panel recommendations will make those tax incentives go further.

It's a great question.

[The Vice-Chair, NDP, Hoang Mai]

Thank you, Mr. Jean.

Mrs. Glover.

[Shelly Glover, Conservative, Saint Boniface, MB]

I too want to thank all the witnesses for being here today.

I'm going to ask a couple of questions. Mr. Bird, I'm going to give you a heads-up about the question I'm going to ask, because I'm going to come back to you. In your submission, you talked about some suggestions for regulatory changes. I'm going to ask you about those. I'll give you a chance to think about it, because I don't have the submission from the philanthropic foundations. I'll come back to you.

Mr. MacDonald, I happen to be a very big supporter of Big Brothers and Big Sisters. I sat on the board of Big Sisters before we amalgamated in Winnipeg. I happened to be, I think, the first parent of a matched child who ever sat on a board of your organization.

I'm going to ask you specifically about bequests, when people bequeath their property, because we have talked a lot about tax incentives, which, quite frankly, seem to target the same donors who are already donating, although we are looking to raise the number of donors. I'm looking for ways to target some of the folks we're missing. When I was policing, there were an awful lot of seniors who didn't have children and didn't have wills. We'd go when they suddenly died. I always wondered how we could educate, because unfortunately, many of those ended up in court settings. It's unfortunate, because some of these folks were linked to organizations.

The reason I'm asking you, Mr. MacDonald, is that when I sat on the board of Big Sisters, there was a large donation by an elderly woman of her home upon her death. I'm wondering if there are any things we as a government could do to encourage the bequeathing of property, given what I've seen and given that your organization has, as I know, benefited from it. If you don't have an answer today, I would like you, and all of you, to think about how we might target that.

I think what Mr. Hutchinson said about advertising isn't really a bad idea, because people might not know that these opportunities exist.

Do you have any comments about targeting people who don't donate?

[Bruce MacDonald]

I don't have a response from the government side. I'm not sure there's something top of mind that really leaps to mind. I immediately go to the organizational side, because organizations like ours have seen these, on an occasional basis, happen across the country. Now I know that there are lots of other organizations that have more fully formed or rigorous planned giving programs. One of the things that unfortunately has happened with us is that we've lost touch with a lot of people over the years instead of having kept them engaged for a very long span of time.

I think on our side of the equation, that's the cultural shift that needs to happen, so that when people are involved with Big Brothers and Big Sisters, in our specific case, we're able to stay in touch and build a relationship, and when people are making these kinds of decisions, it has been written in. We're seeing that happen.

[Shelly Glover, Conservative, Saint Boniface, MB]

I'm sorry to cut you off, but I want to get to Mr. Bird's answer. And I do want anyone who has an idea on how we might tap into that to write in afterwards. That would be good.

Mr. Bird, go ahead.

[Ian Bird]

The regulatory environment in Canada has yet to catch up to all the opportunities that are out there for community investment by pools of capital such as might be with foundations or pension funds or other such places that would assist community social enterprises.

Mr. Brison asked the question about whether this should be examined. One of the reasons to answer yes is the one I gave. The other one is because of the regulatory environment.

I'll give you an example. A limited partnership that's an activity for an environmental social enterprise may well be the best vehicle to achieve that environmental objective, and an economic benefit, a financial return. At the moment the available pools of capital in our foundation environment—and in the case of Community Foundations, that's $3 billion in capital—cannot be placed in that limited partnership, whereas it can in the U.K. and whereas there is an evolution in the United States, as we just heard about.

For Canada to make available its community capital, we could improve the regulatory environment to allow for that, and then limited partnerships would open up and that capital would be available to those enterprises.

[The Chair, Conservative, James Rajotte]

There are about 30 seconds.

Mr. Bussey did want to comment. It's up to you.

[Shelly Glover, Conservative, Saint Boniface, MB]

I'll get to you.

But through you, Chair, could we get a copy of Philanthropic Foundation's report, which makes some recommendations on the regulatory...?

Mr. Bussey, go ahead.

[Barry Bussey]

I just want to mention, as a member of the Canadian bar, that the law societies across the country will often have a special wills day, and so forth, offered to the public.

But it takes me back, as well, to the concept and the idea.... Remember, many years ago, the government supported the importance of Canadians to exercise, so there were all kinds of ads for ParticipACTION and so on. I'm almost wondering if we shouldn't have a ParticipACTION kind of initiative on behalf of the government to give to charities and so forth.

I know that as a youngster, growing up in our schools in Canada, seeing all of those ads on TV.... I always wanted to play hockey anyway, but it was just like, yes, I was part of the culture and that kind of thing.

[The Chair, Conservative, James Rajotte]

Thank you.

We'll go to Mr. Julian, please.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thanks very much, Mr. Chair.

I'd like to start off just by giving each of you a chance to answer Ms. Sims' question around putting that culture of giving in the schools, and charitable organizations instructing a new generation of Canadian children and youth to get involved. If you have suggestions or comments on that, we'd really appreciate hearing them.

[The Chair, Conservative, James Rajotte]

Mr. Robinson.

[Peter Robinson]

I would suggest, though, that trying to raise awareness on giving at the school level has a couple of problems attached to it. I think what you would want to do is expose kids early to some of the benefits these charities are providing, so they're better educated about what charities are doing in their communities and they see the impact of them, and even potentially participate as volunteers. That's a way for them to be encouraged to be much more participatory, and then, as they get older, you can move into a culture of giving, rather than coming straight at them and hitting them with, “You need to be a giver”. That would be my only comment on that earlier question.

[The Chair, Conservative, James Rajotte]

We have Mr. MacDonald and then Mr. Hutchinson.

[Bruce MacDonald]

Yes, I agree. I think the first step is around civic engagement and how kids understand the role of their coaches as volunteers and understand that some of the people with whom they interact, their mentors, are volunteers playing a role in their community, and that they need support. I think that's the first place.

The other thing is that there is a network of organizations like Big Brothers Big Sisters that are out there and can help be the ambassadors of that.

It's funny. We've had some internal conversations around what the role is that our mentor volunteers play when sitting with a young person in a school or at a community centre and those kinds of conversations they can have. We can be part of that voice.

[The Chair, Conservative, James Rajotte]

Okay.

[Don Hutchinson]

Thank you, Mr. Chair.

Again, that is a good question. The integration in the community is so vital. A number of organizations are engaging with extracurricular activities, such as World Vision Canada's 30 Hour Famine, which has become very popular in the high schools and helps to identify with the cause as well.

A number of provinces now require a certain number of community service hours, working with these charitable and community-minded organizations, as part of the process to graduate. So you're actually getting a practical introduction to civics.

But there is nothing quite like the civics class itself, talking about what's out there. It's amazing to me the number of young people who are unaware of how government operates. They're unaware that in Canada we have several levels of government, and they are completely unaware of our Constitution—these types of things.

I would hearken back to another great advertising campaign, Barry, the Canadian Heritage Minutes, a great opportunity to introduce people to the realities of civics if they're not going to get it in high school. That's something the federal government is allowed to do.

[The Chair, Conservative, James Rajotte]

Mr. Van Pelt wants to comment too, Mr. Julian.

[Michael Van Pelt]

If you observe over the last 40 years a lot of the conversation about the problems we're facing or the challenges we're dealing with, we've defaulted to fewer and fewer institutions to solve the problems of those challenges. If you're on the right, you kind of default to the market to say it will solve the problem. If you are on the left, it's the government that solves the problem.

A lot of the conversation, even in a young environment, becomes, “Okay, here's the problem. What institution...?” It will be the government that actually solves the problem. Even in popular news talk, the impulse is to ask what government can do. What's missing is that whole conversation about what those institutions in between government and the market can do.

Just look at the future of service clubs in this country. There's a really critical story there about us needing to change the conversation about what institution is best to solve the very problems we want to talk about at school.

[The Chair, Conservative, James Rajotte]

You have about 30 seconds.