Mr. Speaker, it is my honour and privilege today to come before this House and speak to Bill C-21, an act respecting not for profit corporations and other corporations without share capital.
The legislation, which would enable the governance regime for federally incorporated not for profit organizations, is a long overdue replacement of the present Canada Corporations Act, or CCA. The CCA, which, to this point, has set the rules for some 18,000 organizations, was first enacted in 1917 and has not been substantially changed since.
Needless to say, the CCA no longer responds to today's needs for the not for profit sector. For example, it is silent on major elements of modern corporate governance which creates uncertainty in the public mind.
Second, it is an administrative burden on the sector and the government.
Finally, it fails to provide adequate protection for men and women who manage or operate these corporations.
In the years since the CCA was originally enacted, the world has changed dramatically and the not for profit sector faces governance challenges that cannot be dealt with under the existing legislation.
In response to these challenges, the government has taken a measured and reasonable approach to addressing the urgent need to reform the not for profit statute. It has looked at the Canada Business Corporations Act as a model of worldclass corporate statute. It then built on the provisions of the CBCA to reflect the requirements of the not for profit sector. It utilized, where appropriate, examples found in provincial not for profit statutes.
Finally, it was benchmarked against similar legislation in the United States. As a result, the new act will be one of the most modern statutes of its kind, measuring favourably against the best features of similar statutes throughout North America.
It may be asked: why now? Why has Parliament not addressed this in the last 80 years? In fact, there have been four previous attempts to reform the CCA but, for a variety of reasons, members of this House or our partners in the other place have never been able to complete the necessary scrutiny of previous bills before they died on the order paper.
We are now presented with an opportunity to bring this legislation up to date and to position federal not for profit law as the new benchmark for other jurisdictions.
The development of a new not for profit corporations act has been a long journey. It began with a commitment under the voluntary sector initiative in June 2000, followed by two rounds of cross-country consultations with shareholders.
The not for profit sector plays many important roles in Canadian society and our economy. It mobilizes citizens and creates a sense of community, enhances democracy, fosters community participation and strengthens our ties to one another. From national corporations created to fight disease to local sports associations, from faith organizations to facilities that provide job training and education to new Canadians, the sector touches most aspects of Canadian life. It is essential to our national identity and to our economy. Many are important government partners in providing services to Canadians.
The Government of Canada recognizes the importance of strengthening Canada's social economy and the thousands of entrepreneurial enterprises that form its backbone. These organizations are not only the key to social economy, but they are also an important pillar of the economy as a whole.
Research indicates that there may be up to 160,000 not for profit organizations creating opportunity in this country. When universities and hospitals are included in these figures, the revenue of the sector is estimated up to $112 billion a year.
The not for profit sector is one of the country's largest employers, employing more than 2.2 million people, with payroll expenditures as high as $64.1 billion. Most of these corporations are incorporated provincially. However more than 18,000 are federally incorporated and many are among the largest and most influential not for profit corporations in Canada.
The proposed new statute would demonstrate the government's commitment to strengthening its partnership with the sector. Current federally incorporated organizations include national charities such as the United Way of Canada and the Heart and Stroke Foundation of Canada. It includes umbrella organizations such as the Canadian Centre for Philanthropy and the Consumers' Association of Canada and several national businesses. It includes religious groups such as the Canadian Jewish Council.
There are health and community based organizations, environmental organizations, and cultural and heritage societies. Also included are transport related organizations such as airport authorities and small harbours. There are also many private foundations that pursue philanthropic objectives to the benefit of Canadians. Each of these and thousands of other small and large organizations perform an important function for their members, their communities, the recipients of the services and, collectively, all Canadians.
Replacing the CCA with a new framework law was a commitment made and reaffirmed many times over the last years. Fulfillment of this commitment would ensure that federally incorporated enterprises are governed by a modern legislative framework that is flexible enough to meet the needs of both small and large organizations while providing the accountability and transparency necessary to secure the support of the Canadian public.
The proposed new act provides a perfect example of smart regulations. It would reduce the administrative burden by making it easier and faster to incorporate and develop internal arrangements that suit the needs of the organization. It would promote good governance by emphasizing accountability and transparency to members and self-regulation more generally. At the same time, it would enhance the scope of governmental and public oversight by requiring greater financial disclosure requirements for organizations that solicit funds from the public or receive government funding.
The act is good for Canadians. It is good for them as individuals and it is good for our communities. I urge all members of the House to support the legislation.