Evidence of meeting #75 for Finance in the 41st Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was give.
A recording is available from Parliament.
Conservative
Mark Adler Conservative York Centre, ON
Thank you.
Mr. Hallward indicated earlier that the trend in charitable donations is moving in a downward direction. Do you think charity+ would address that downward trend and see an upward slope?
Mr. Carmichael.
Prof. Calum Carmichael
My sense is that relative to a stretch tax credit that would self-extinguish—once you give a high amount, you're no longer eligible for any additional bonus—a charity+ would have a long-lived incentive.
Conservative
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Thank you, Mr. Chair.
Thank you to all the witnesses for being here.
Mr. Hallward, in your brief you mentioned that we have a charity gap. We know we already have the gap between the rich and the poor—it's getting bigger and bigger—but you're talking about the charity gap. You also mentioned that the cutbacks from the government in terms of charities threatens all charities.
Can you give us a bit of a picture of what's happening on that side?
Chairman, Hallmont Foundation, GIV3
Yes.
I don't mean to impute anything for the Canadian government; just looking at governments in austerity movements in Europe and elsewhere, many governments have deficits and huge debt loads. The need to more fiscally balance budgets requires a pullback in what they're spending.
If they're pulling back at the same time that Canadians are not stepping up to replace that gap, we end up with a wider and wider gap. Our initiative is to try to fill that void, to try to get Canadians to increase and replace...hence the name “billion-dollar solution”. In a sense, for every billion dollars the government wants to pull out, can we incent and encourage Canadians to replace that billion?
It sounds like a high number, but it's actually not that difficult. A billion dollars on a giving of about $8 billion is only about, what, 12% or 13% change?
NDP
Hoang Mai NDP Brossard—La Prairie, QC
I also understand that you want GIV3 to be the group that encourages charitable giving or donations.
Are you getting support from other groups in terms of your group being the voice, the ParticipAction, if you want—as you mentioned—in terms of being the focus...?
Chairman, Hallmont Foundation, GIV3
It's a very fair question.
Our real goal is to try to avoid duplication. We have an advisory panel. Marcel, from Imagine, is on it; Ian Bird, from the Community Foundations is on it. Hillary, from PFC, is on it. Al Hatton, who is leaving the United Way, is on it. Hopefully Jacline will join us. We have a meeting with her in two weeks.
We want to work with all of them. It's a bit like apple pie and motherhood; the more the charity goes up, everybody gains.
We're very focused on messaging to citizens. Imagine Canada has a corporate initiative and policy initiative. We don't do policy, we don't do corporate; it's specifically that gap that nobody else is addressing in Canada right now, which is to Canadians.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
If I understand correctly, you're getting support from most of the organizations. You mentioned Imagine Canada, which is one of the big ones.
Everyone agrees that we need to have.... We talked about the leader in another bill, but you would be the leader and everyone supports that.
Chairman, Hallmont Foundation, GIV3
Yes. There was a national summit in Ottawa at the end of last November, and those four organizations that I just mentioned brought everybody together. It was very well attended—500 attendees. The idea was on how to promote the sector.
There was not a whole lot that came out of it. I'm not pointing the fingers at anybody. The problem is that each of those four organizations has their own budget, their own mission statement, their own board, etc. Collaboration is extremely difficult when you have four different groups with different budgets, mandates, boards, etc.
The solution, then, is not collaboration. Of course we're going to have collaboration, but it will be one brand. There will be one steering committee, one board, one budget, working in partnership with each of these organizations.
They support that. They will say it has been frustrating since last November that they couldn't step it up, but that none of them have the mandate to do that.
We came from nowhere. We're self-appointing. I'm giving ourselves that mandate; now what I need to do is get support and seek capital and get it going.
NDP
Hoang Mai NDP Brossard—La Prairie, QC
Mr. Houston and Mr. Broder—I don't have much time left here—we've been pushing for the stretch tax credit, and I understand that you're both supporting it. Also, you're suggesting others; for instance, capital gains.
What would it be, if you had to choose one? Would it be stretch tax credits, in terms of one measure as a start?
Chair, Philanthropic Foundations Canada
I think the various mechanisms we've discussed today are aimed at different constituencies and would release different resources from different groups. I think it's hard to say there's one answer. I think what you want is an array of strategies to tap the giving impulses of different Canadians in different situations.
The stretch credit is quite different from the private share proposal...is quite different from thinking about some of the things I talked about in my remarks.
Collectively, I think they have the effect of unlocking significant new money for Canadian charities from a range of givers.
Chair, Charities and Not-for-Profit Law Section, Canadian Bar Association
I think the stagnation in terms of tax filers claiming credits is a pressing problem; so the stretch.
Conservative
Dave Van Kesteren Chatham-Kent—Essex, CPC
Thank you, Chair.
Thank you to all for coming.
Mr. Carmichael, one of the problems we have in this country with university research is that we do some really great research, but a lot of it never reaches the marketplace. Is there a danger, if we begin to orchestrate where moneys go, that we will start to stifle that type of research that is just raw research?
The industry committee travelled a number of years ago. We noted that there really are a lot of interesting people who work in some of the universities who just are given the free expression to go and explore.
But isn't there a danger that what will start to happen is that governments will say, yes, we will allow this type of moneys to be noted as...but they get their hands involved, and they get their will involved, and the next thing you know they start to say which direction universities go on research?
Prof. Calum Carmichael
If there was trying to be a very fine designation of what particular activity was important, I could see that you might be denying creativity, inventiveness, or resourcefulness more widely seen. You might miss or stifle that creativity by funding one area.
What I am suggesting is really quite a broad-brushed area, hoping that different organizations will find different ways in which to attend to quite a broadly defined need. I don't see this as controlling or missing entrepreneurship or creativity, rather encouraging it, but in an area that the government sees as really most pressing—the needs that are most important.
Chatham-Kent—Essex, CPC
To further that, I want to ask you a little bit about this. If we think about the history of donations and why governments have gotten into the habit of affording people tax deductions when they give, governments recognize that there are areas in society—I'm not telling you anything new, but just for the sake of those who might be listening—that they can't tend to, or they may fail to tend to. Subsequently, charitable organizations crop up that see these needs and then serve those areas.
I guess this is a broader question to everybody as well. Again, if we move away from....
You made a very interesting point—maybe we will have time to go back to that—about the fact that Australia doesn't offer tax deductions to religious organizations.
Again, if we start to organize, won't we be in essence picking winners and losers on social subjects or social areas that traditionally those organizations have served?
Prof. Calum Carmichael
My sense is that the government should not try to tell me where to give. Indeed, I am a churchgoer. I give to my church. When I went to Australia, where there are no tax credits, I still gave the same amount to my church. Frankly, I haven't come back to actually sending the government back my money that I get as a tax credit. But I don't need that.
My sense is this: is that really a prudent use of government resources to encourage giving that would take place no matter what, whereas to tip the balance in some areas, so that giving is actually more responsive in areas that perhaps are a greater need, that would be important?
In Australia, as in Canada, a large minority of private contributions already go to religious organizations regardless of whether or not there is a tax credit. In Canada, it's something like 46%. In Australia, it's something like 39%.
Chatham-Kent—Essex, CPC
That's very close. That was going to be my question.
Chatham-Kent—Essex, CPC
So the fact of the matter remains that, whether or not church organizations get a donation, they still seem to make those donations. I guess that's the reason you're saying we need to encourage other areas that traditionally don't.
