Charity Confusion a Sign of Abuse of Power


The last sev­eral days have seen mul­ti­ple news reports and edi­to­ri­als in which CRA offi­cials made claims, and later revised them, about how char­i­ties are selected for polit­i­cal audits (see my post­ing on the fun­nel that the gov­ern­ment con­structed that tar­gets cer­tain char­i­ties). And then we learned that CRA blacked out key details in response to a freedom-of-information request by Pen Canada that explained to its audi­tors how to eval­u­ate a charity’s “polit­i­cal activities.”

Pro­vid­ing infor­ma­tion about how we con­duct our gen­eral audit review could hin­der or impede our abil­ity to effec­tively carry out future audits,” CRA spokesper­son Philippe Brideau told Globe and Mail reporter Kathryn Blaze Carl­son., before claim­ing that the CRA web­site con­tains expla­na­tions of char­i­ta­ble, polit­i­cal, and par­ti­san activities.

Pen Canada exec­u­tive direc­tor Tasleem Thawar sug­gested to Blaze Carl­son that CRA should be less inter­ested in catch­ing char­i­ties break­ing the rules than in help­ing them under­stand what activ­i­ties are unac­cept­able so that they can fol­low the rules.

I think Cana­di­ans would expect that the CRA would pre­fer to share their advice to audi­tors if it helps char­i­ties stay within the roles. Seems com­mon sense to me.

In any case, the rev­e­la­tion is sadly con­sis­tent with what I found in my Master’s the­sis inter­views with 16 char­ity lead­ers and five experts. What the data sug­gests is that lead­ers are con­fused about the reg­u­la­tions and that this con­fu­sion has been going on for years. There are grey areas between char­i­ta­ble activ­i­ties and allow­able polit­i­cal activ­i­ties. And between polit­i­cal activ­i­ties and for­bid­den par­ti­san activ­i­ties. Lead­ers repeat­edly told me that they have tried using the infor­ma­tion on the web­site for guid­ance but the exam­ples that are used are “naïve” and con­fus­ing. And lead­ers told me that they have had no responses to the ques­tions they left in the sec­tion of the web­site where char­i­ties are encour­aged to ask CRA for just that.

Vet­eran lead­ers and some char­ity experts (lawyers, aca­d­e­mics, for­mer bureau­crats in the know) give kudos to CRA for hav­ing made much progress in com­mu­ni­cat­ing some reg­u­la­tions and expec­ta­tions through the web­site and in bul­letins and other exter­nal mes­sag­ing. Things were much worse before the $95 mil­lion Vol­un­teer Sec­tor Ini­tia­tive con­sul­ta­tions between the non­profit and char­ity sec­tor and var­i­ous gov­ern­ment depart­ments, includ­ing CRA. Dur­ing those con­sul­ta­tions, CRA lib­er­al­ized some of its approach to reg­u­la­tions, loos­en­ing their choke-hold on polit­i­cal activ­i­ties in 2003, for exam­ple, and nego­ti­at­ing inter­pre­ta­tions of regulations.

So, CRA has improved its com­mu­ni­ca­tions and there were signs that inter­pre­ta­tions were becom­ing more con­sis­tent. But that was before 2012 and the cur­rent round of political-activities audits, politi­cized by the cur­rent fed­eral gov­ern­ment, and the belief that new, stricter inter­pre­ta­tions of the reg­u­la­tions are emerg­ing dur­ing this targeting.

And mean­while, the grey areas remain and attempts by char­i­ties to address them with the CRA, by use of freedom-of-information requests if nec­es­sary, are not work­ing. And char­i­ties are forced to seek advice from lawyers and accoun­tants at sub­stan­tial cost, with the accom­pa­ny­ing diver­sion from their Mis­sion activ­i­ties of money and human resources. Inter­est­ingly, I found that dif­fer­ent char­i­ties were get­ting slightly dif­fer­ent advice from their lawyers about those grey areas, so clearly there is no com­plete con­sen­sus out there. And it is, of course, CRA’s job to make sure that their inter­nal under­stand­ing of the reg­u­la­tions is everyone’s under­stand­ing. Mean­while, Imag­ine Canada, the umbrella orga­ni­za­tion of Cana­dian char­i­ties, has cre­ated a use­ful infor­ma­tion sheet address­ing some of the reg­u­la­tions; but grey areas remain.

My study found a high level of con­fu­sion among char­ity lead­ers and to a lesser extent among some experts. They are con­fused about var­i­ous reg­u­la­tions, they are con­fused about the grey areas regard­ing the var­i­ous activ­i­ties. They are con­fused, anx­ious and annoyed by the tar­geted audits and the attempt to muf­fle and dis­tract them from their socially ben­e­fi­cial Missions.

They are con­fused and angry at being labelled “money-launderers,” “crim­i­nal orga­ni­za­tions,” and “ter­ror­ist orga­ni­za­tions” by gov­ern­ment min­is­ters who ought to know better—and they’re almost uni­formly smart enough to know not to pub­licly make the denial because then they fall into the trap sim­i­lar to an inno­cent insist­ing, “I do not beat my part­ner.” They have to count on Cana­di­ans know­ing that they are none of crim­i­nals, ter­ror­ists or trai­tors, and hope that peo­ple blame the gov­ern­ment for its “smear cam­paign,” as sev­eral of them labelled it.

In any case, all this con­fu­sion, mixed with fear in vary­ing doses from leader to leader, pro­foundly points to the gov­ern­ment and its tax author­ity improp­erly using its power. In the case of the tax­man, the abuse is to allow the con­fu­sion over reg­u­la­tions to con­tinue, to allow grey areas to fes­ter, to not directly address the belief among char­ity lead­ers that the inter­pre­ta­tions are shift­ing dur­ing the cur­rent stepped-up audit­ing process.

The far more trou­bling abuse of power involves a gov­ern­ment that uses fierce rhetoric that treats cit­i­zen groups as ene­mies, and uti­lizes an arm of the admin­is­tra­tive func­tions to fight its pol­icy dis­agree­ments through the threat and real­ity of CRA audits. This bul­ly­ing in the form of rhetoric and audits muf­fles and dis­tracts the char­i­ties while the gov­ern­ment pushes through major poli­cies and pro­grams with­out proper pub­lic con­ver­sa­tions. And the lack of full pub­lic par­tic­i­pa­tion in debates, includ­ing the input of the char­i­ties that are experts in their Mis­sion top­ics, dulls the very vigor of our democ­racy as well as risk­ing our future through poten­tially poor pol­icy choices.

Mean­while, please check out my Master’s the­sis and feel free to for­ward and tweet it. And you can fol­low me on Twit­ter: @garethkirkby


I am a for­mer jour­nal­ist and media man­ager who recently com­pleted my Master’s the­sis for Royal Roads Uni­ver­sity and now work as a com­mu­ni­ca­tions pro­fes­sional. I have earned a Web­ster Award of Dis­tinc­tion, among other awards, for my reporting.

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