Evidence of meeting #45 for Finance in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was sir.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Michelle Douglas  Former Chair of the Board of Directors, WE Charity, As an Individual
Clerk of the Committee  Ms. Caroline Bosc
Marc Kielburger  Founder, WE Charity
Craig Kielburger  Founder, WE Charity

12:55 p.m.

Liberal

Peter Fragiskatos Liberal London North Centre, ON

It's quite normal to see that back and forth between an executive and a board.

To clear it up—and I think you've been extremely clear with our committee—you recently spoke to The Globe and Mail and said that you left the organization over “concerning developments” that were transpiring. As we have heard, these relate to disagreements over WE's current direction, at least in March, and its future direction regarding the course forward. They had nothing to do with the Canada student service grant and nothing to do with the contribution agreement that WE eventually signed with the federal government. Is that correct?

12:55 p.m.

Former Chair of the Board of Directors, WE Charity, As an Individual

Michelle Douglas

That's right.

12:55 p.m.

Liberal

Peter Fragiskatos Liberal London North Centre, ON

I have a final question for you, and I know others have asked this as well. The organizational structure of WE is a complex one. For example, we have WE Charity, but then it's broken down into various parts. There's WE Charity (U.S.); WE Charity Canada, obviously; WE Charity (U.K.); the ME to WE Foundation; WE Well-being Foundation; WE Well-being Foundation America; We365 LP; We365 Holdings; We365 GP Inc.; Imagine 1 Day International Organization; and ME to WE Social Enterprise. I'm just listing them here from the page in front of me. It's, again, a question that's been asked by Charity Intelligence and other watchdogs of the charity sector. Why is there this organizational structure? It's very complex, very intricate. Do you have any insights on that?

July 28th, 2020 / 12:55 p.m.

Former Chair of the Board of Directors, WE Charity, As an Individual

Michelle Douglas

Certainly I would acknowledge that there are many entities associated with the WE brand generally. The prevailing work of the WE Charity board was to focus on the areas we had responsibility for. But certainly we were linked by things such as branding, or potentially by connections of closely related individuals. The board was always interested in getting more insight, more information and details about these relationships and entities. I expect, had I continued to serve, that it is an area I would have continued to push on. Obviously, the co-founders are best placed to explain the complex structure that was established.

1 p.m.

Liberal

Peter Fragiskatos Liberal London North Centre, ON

Thank you very much.

1 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you both.

Ms. Douglas, we have another panel, which you're very aware of. On behalf of the committee, I re-emphasize my remarks from the beginning. Thanks for your service to this country in many roles, in the human rights aspect around the world, as well, and specifically in Canada.

With that, again we thank you for appearing. We thank you for answering our questions.

We will suspend for about three minutes to give the clerk time to test the mikes of our next witnesses. The meeting is suspended for three minutes.

1:05 p.m.

Liberal

The Chair Liberal Wayne Easter

All right.

We'll call the meeting to order. All the technicalities are out of the way.

We are meeting on government spending, WE Charity and the Canada student service grant. Just for everyone's information, the meeting is taking place by video conference, and proceedings will be made available via the House of Commons website.

We'll now start our second panel of today.

I'd like to welcome Craig and Marc Kielburger, the founders of the WE Charity.

Thank you both for agreeing to take the four hours.

For the information of committee members, because a four-hour meeting is somewhat unusual, the Kielburgers had initially asked for 20 minutes during the two-hour session. We responded that the maximum we'd allow them was 10 minutes, but now that we're doing four hours, I've decided that it's quite fine to do the 20 minutes, which still give us lots of time for questioning.

With that, we are ready to start, with the exception that, I believe, you wanted to be sworn in, and so I'll turn that over to the clerk.

1:05 p.m.

Conservative

Pierre Poilievre Conservative Carleton, ON

On a point of order, Mr. Chair, I'd simply ask that the 10 minutes that we have now consumed on technical things not be subtracted from the four hours of testimony that the committee obliged of the witnesses. We will be at 1:10 when proceedings begin. Thank you.

1:05 p.m.

Liberal

The Chair Liberal Wayne Easter

Yes, we can see where we're at on that. I would say as well, though, that I believe it's proper that we probably take a five-minute break at the two-hour period. Four-hour straight testimony is pretty gruesome, and we all may need a washroom break by that time.

Madam Clerk, would you do the next procedure.

1:05 p.m.

The Clerk of the Committee Ms. Caroline Bosc

Welcome.

We'll ask you to now, one after the other, take the oath or affirmation. You can repeat the text that is in front of you. Please speak clearly and loudly so that everyone can hear.

1:10 p.m.

Marc Kielburger Founder, WE Charity

My name is Marc Kielburger. I do swear that the evidence I shall give on this examination shall be the truth, the whole truth and nothing but the truth so help me God.

1:10 p.m.

Craig Kielburger Founder, WE Charity

My name is Craig Kielburger. I do swear that the evidence I shall give on this examination shall be the truth, the whole truth and nothing but the truth so help me God.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Okay. Thank you both.

We will now turn the floor over to you. If you can hold it as very tight as you can in terms of time length, that would be great.

The floor is yours. Welcome.

1:10 p.m.

Founder, WE Charity

Craig Kielburger

Thank you.

Good afternoon.

My name is Craig Kielburger and this is my brother Marc.

First, thank you, Mr. Chair. We will remain within the 10 minutes, in fact. We are grateful to the rest of the committee. We've been looking forward to this opportunity to speak with you here today.

Over the past few weeks, our team has responded to thousands of questions from the media. We have posted dozens of documents online, including an annotated version of the Canada student service grant contribution agreement and information on WE Charity's programs, operations and finances.

Along the way, we have announced that additional experts will analyze our systems to streamline our organizational structure, further improve our governance and focus our efforts to help the most vulnerable children around the globe.

1:10 p.m.

Conservative

Michael Cooper Conservative St. Albert—Edmonton, AB

Point of order, Mr. Chair.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Excuse me, gentlemen.

What's your point of order, Mr. Cooper?

1:10 p.m.

Conservative

Michael Cooper Conservative St. Albert—Edmonton, AB

Thank you, Mr. Chair.

I just want to raise it, at this point, to the degree that my point of order could impact upon...or should either of the witnesses wish to rephrase or reframe any aspect of their presentation.

Given the large number of organizations the Kielburger family is affiliated with or otherwise connected with, from now until the end of this meeting, when Conservative members make reference to WE or your organization, unless otherwise stated, we are referencing, in the broadest way possible, any corporation, company, partnership, organization, association, entity or upper structure, including, but not limited to, WE Charity, WE Charity Foundation, ME to WE, ME to WE Social Enterprise, ME to WE Foundation—

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

I'm going to interrupt you, Mr. Cooper. I do not believe that's a point of order; I think it's a point of information.

I will remind you that we are meeting on government spending, WE Charity and the Canada student service grant. That's what the motion we're dealing with as a committee is on. The Kielburger brothers can take your comments as information.

We'll go back to you, Mr. Kielburger. Go ahead.

1:10 p.m.

Founder, WE Charity

Craig Kielburger

Thank you, Mr. Chair.

Twenty-five years ago, we started WE Charity as teenagers because we believed young people have much to offer through service. We still hold this belief.

There is a crisis in Canada's charitable sector. Over the past 30 years, Canada has seen steadily declining rates of civic engagement and reached a record-low percentage of Canadians donating to charity.

WE Charity sought to reverse this trend by launching WE Schools, active in 7,000 Canadian schools, to educate and inspire young people to learn about causes, volunteer for the first time in their lives and fundraise to make an impact for thousands of charities across the country.

Through WE Day, over one million youth earned their free ticket through logging over 70 million hours of service. Youth joined us to build 1,500 schools and classrooms in developing countries around the world, educating over 200,000 kids in clean water and medical programs, reaching over a million beneficiaries.

We launched ME to WE Social Enterprise because traditional models of charity are too limited in Canada. Its purpose is to help end poverty overseas. We create empowering jobs and bring to market fair trade and socially conscious products, helping mostly women entrepreneurs. Although its purpose was never simply profit, since its founding in 2008, 100% of profits from ME to WE Social Enterprise have been donated to WE Charity or reinvested to grow the social mission: every single penny.

This model is called a social enterprise. It's common in Europe, but in Canada the Canada Revenue Agency limits a charity's ability to operate a business model as a solution to solving social problems. In 2019 the Senate of Canada released a report that recommended that the government recognize and reconsider those restrictions for charitable and non-profit organizations. We strongly support that recommendation. With such a change, we would have simply started ME to WE Social Enterprise as a charity.

We acknowledge that over 25 years, our organizational structure has grown overly complex. Our model is different, sometimes misunderstood and, yes, far from perfect, but our purpose has always been social innovation to better Canada and the world.

WE Charity is a non-partisan organization. We have worked with federal and provincial governments of every party across Canada. We have welcomed politicians of all stripes to the WE Day stage, including Conservative MP Mike Lake and then NDP premier Rachel Notley. We're grateful to the previous government that Laureen Harper hosted the WE Day after-reception at 24 Sussex.

Over the years, thousands of stories have been shared on the WE Day stage. We invite individuals to speak who can inspire youth to volunteer and serve, which is what our mission is all about.

WE Charity agreed to implement the Canada student service grant not to be helped by government but to help government and to help young people across Canada. This program was developed in the midst of a global pandemic, when governments and the private sector were scrambling. Some have suggested that WE Charity was in dire financial straits prior to the CSSG, and that it somehow motivated our actions. It simply isn't true, because, like many Canadian non-profits and businesses, we had already taken difficult actions to adjust staff members and to pivot our programs to the new realities of COVID, as you heard a moment ago.

My comments about that time are not false bravado. As we see the organization today, I acknowledge that the fallout now from this political process has resulted in serious challenges that risk the entire organization and our 25 years of work.

As you heard in previous remarks to this committee from Rachel Wernick and the Clerk of the Privy Council, we were not chosen for this work by public servants because of our relationship with politicians. We were chosen because we were willing to leverage every part of our 25 years of experience and to build this program at the breakneck speed required to have an impact for Canadian youth over the summer.

WE Charity had experience in this area. We had previously built two large-scale youth service programs. When Ontario introduced the mandatory 40 hours of community service, we developed a program for many school boards across the province. The College Board, which is the largest U.S. association of colleges and universities, selected WE Charity three years ago to develop a national U.S. service program across all 50 states.

I'll turn now to the contribution agreement itself. As per the contribution agreement, WE Charity would only be reimbursed for its costs to build and administer the program. To be clear, there was no financial benefit for the charity. WE Charity would not have received any financial gain from the CSSG program, and it's simply incorrect to say otherwise. The contribution agreement had proper oversight built in, with some 13 references to audits, and taxpayers were protected. Our team worked incredibly hard to build and launch the CSSG as a national bilingual service program. The results were evident within the first week, with 35,000 youth applications from every province and territory, 83 non-for-profit coalition partners, and 24,000 and increasing service roles.

But the program quickly got pulled into politics. We handed the built system, technology, even the call centre, to the public service, hoping to save the program. We declined any reimbursement for our costs. We thought our actions would enable the program's long-term survival, and we are deeply saddened that it did not. We also regret that the fallout has created hardship for our staff, our partners and the communities we serve.

When Employment and Social Development Canada asked us to administer the Canada student service grant, we regret that we didn't recognize how this decision would be perceived. We would never have picked up the phone when the civil service called, asking us to help young Canadians get through the pandemic, if we had known the consequences: that young people would not get the help they need now and that 25 years of WE Charity's programs helping millions of youth would be in jeopardy.

We are most sorry for the students of Canada. We know that this pandemic has put so many in dire straits, unsure of whether they will be able to continue their education or even pay their rent. This committee heard yesterday about MPs' offices being flooded with emails and calls from students desperate for help. These students should be volunteering, serving their country and receiving critical support for their education.

We respect this process and we are happy to participate. We hope the people of Canada will have their questions answered about how the contract came about and what the value of money would have been. We also hope that as soon as it concludes, all of us—non-profits, governments and all Canadians—can get back to helping the students of Canada get the support they need to get through this time of national crisis.

Mr. Chair, thank you for the opportunity to share those words. We appreciate that. We are ready for your questions.

1:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you to you both.

The first round of questions will be a six-minute round. We will start with Mr. Poilievre and then go to Ms. Dzerowicz, Mr. Fortin and Mr. Angus.

Mr. Poilievre, the floor is yours.

1:20 p.m.

Conservative

Pierre Poilievre Conservative Carleton, ON

Marc, you were caught on tape describing an April 23 call with the Prime Minister's Office. You quoted that office as telling you the following: “You know that announcement we just made, would you be interested in helping us actually implement it?" You now deny that call. Was it a figment of your imagination?

1:20 p.m.

Founder, WE Charity

Marc Kielburger

Mr. Poilievre, the call you're speaking about was to a group of potential non-profit partners. We were very excited about the prospect of the program. I got a little bit ahead of myself. I didn't have the full details. I misspoke. As soon as I realized I misspoke and it was brought to my attention, I apologized, and I do apologize again.

1:20 p.m.

Conservative

Pierre Poilievre Conservative Carleton, ON

Sir, the Prime Minister's Office never called you, and you never called the Prime Minister's Office, on April 23?

1:20 p.m.

Founder, WE Charity

Marc Kielburger

Sir, that is very much correct. The Prime Minister's Office never did call us. Craig has the details. He was the one who was having the conversations.

1:20 p.m.

Conservative

Pierre Poilievre Conservative Carleton, ON

I got it. That's all I needed to know.