On Monday November 19, 2018 I presented to the Special Senate Committee on the Charity Sector in Ottawa. My presentation dealt with a number of areas especially transparency of non-profits and registered charities, good charity regulation, and political activities by charities.
Here is the full Video Webcast and my testimony begins at 19:39:16.
Also here are a couple of schedules that I provided with my verbal comments:
Schedule “A”
To understand what is a good or appropriate charity regulator I have tried to distill about 17 factors:
- good rules (enabling for charities but not scammers)
- attitude of regulator (fair, realize diversity of sector, helpful, empathetic)
- strategy of regulator/regulatory approach
- staff knowledge (technical expertise)
- prepared to listen (consultations)
- willingness to change or adapt within rules
- timeliness (in responding to charity applications and requests)
- regulatory burden vs. benefit (e.g. whether tax incentives)
- educating charities about rules (communication and capacity building)
- transparency as to rules and rule of law (guidance)
- concern with public interest vs. business/political parties
- well managed up to date list of charities with relevant information on each charity and making data available publicly
- collaborate with sector when appropriate
- predictability/certainty/consistency
- one regulator versus many overlapping or contradictory regulators
- strength/resources of regulator to handle really bad charities
- stakeholder fairness (charities, government, donors, beneficiaries, etc.)
Schedule “B”
List of Recommendations from Mark Blumberg
• Recommendation 1: That the government amend Section 241 of the Income Tax Act in order to allow the CRA to disclose serious non-compliance with legal requirements by a registered charity, Registered Canadian Amateur Athletic Associations or certain other qualified donees.
• Recommendation 2: That the government amend Section 241 of the Income Tax Act in order to allow the CRA to disclose to the public information contained on the T1044 Non-Profit Organization (NPO) Information Return.
• Recommendation 3: That the government increase the disbursement quota payout from 3.5% to 5% or 6%.
• Recommendation 4: That the government ensure that each donor advised fund is required to disburse a certain percentage per year per fund.
• Recommendation 5: That the government roll out additional educational programs to assist Canadian charities and non-profits understand their compliance obligations.
• Recommendation 6: That the government require charities to demonstrate annually in their reporting that they actually have a “public benefit”, rather than this being assumed
• Recommendation 7: That the government consider the pros and cons of implementing a system where the ability to issue tax receipts is not based on being a “registered charity” but rather a narrower category of deductible gift recipients.
• Recommendation 8: That the government establish a unit within the RCMP, or other police force, tasked with the responsibility of reviewing complicated abusive charity schemes that provide inappropriate official donation receipts.
• Recommendation 9: That the government change its October 25, 2018 proposal to allow non-partisan political activities connected to the purpose of the charity but it must be subordinate (less than 50%) to the charity’s charitable activities.
• Recommendation 10: CRA should be given extra resources to ensure that the objects and latest financial statements of all Canadian charities are easily accessible on the CRA website.