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.