Smoking Gun Not Needed to Find Abuse of Power

Have the bird­watch­ers in Water­loo county found a smok­ing gun prov­ing direct gov­ern­ment inter­fer­ence in Canada Rev­enue Agency’s audits of the “polit­i­cal activ­i­ties” of char­i­ties? I don’t think so, but it’s sure start­ing to add weight to those who claim so.

The char­ity lead­ers and experts I inter­viewed for my the­sis were divided about whether the gov­ern­ment directly inter­fered in the audit­ing process of CRA or whether it indi­rectly pushed CRA in the direc­tion of audit­ing char­i­ties that got in the way of the Harper cabinet’s pol­icy priorities.

Some char­ity lead­ers spoke of a peer who allegedly has a doc­u­ment that points to a min­is­ter telling the tax­man to audit their orga­ni­za­tion. Per­haps so. But I couldn’t get near that alleged doc­u­ment holder and nobody else was shar­ing any­thing resem­bling ink on paper or fin­gers hav­ing graced a key­board. So per­haps the doc­u­ment exists and will emerge in due course. Cer­tainly, some of CRA deci­sions around audits are strange, includ­ing at least a cou­ple of char­i­ties being in a vir­tu­ally per­pet­ual audit. If that’s not an abuse of author­ity, it’s hard to imag­ine what is.

In con­trast, there is plenty of evi­dence of indi­rect stage-managing by the gov­ern­ment to push CRA to the char­i­ties that are caus­ing has­sles for the gov­ern­ment and its resource indus­try friends. I shall elab­o­rate that below, but first let’s look at some recent news that seems to add a few weights to the side of the scale for those who believe there is direct interference.

The lat­est news, more great work by reporter Dean Beeby who recently left Cana­dian Press to head to CBC, con­cerns a group of ama­teur nat­u­ral­ists in semi-rural Water­loo County. The Kitchener-Waterloo Field Nat­u­ral­ists received a “warn­ing let­ter” from CRA after they made pub­lic com­ments that the tax­man found prob­lem­atic. CRA, to its credit, sent a let­ter rather than audit­ing the group for polit­i­cal activ­i­ties. That’s prob­a­bly just as well for the gov­ern­ment. I used to work as a jour­nal­ist in K-W and area, and in my expe­ri­ence the mem­ber­ship of the ama­teur nat­u­ral­ists and bird-watching groups heav­ily leaned toward middle-class Con­ser­v­a­tive voters.

For­mer group leader Roger Suf­fling told Beeby that the let­ter arrived soon after the group had writ­ten to two fed­eral cab­i­net min­is­ters to protest government-approved chem­i­cals that sci­en­tists believe are caus­ing cat­a­strophic declines in bee colonies. The CRA let­ter arrived just days before a let­ter of response from Envi­ron­ment Min­is­ter Leona Aglukkaq, and Suf­fling sees a con­nec­tion. The group has also invited a guest speaker to speak about the oil­sands and has pub­licly defended the Endan­gered Species Act from gov­ern­ment weakening.

Suf­fling has writ­ten on a blog that the field nat­u­ral­ists have reacted to the warn­ing let­ter by choos­ing silence. In my research, I spoke to char­ity lead­ers who had expe­ri­enced their boards of direc­tors, or those of col­leagues, pull sharply back from speak­ing pub­licly out of fear of being audited by CRA. I found that the Harper gov­ern­ment was try­ing, with some suc­cess, to muf­fle and dis­tract char­i­ties from their mis­sions. And in some cases silenc­ing them.

The reg­u­la­tions allow char­i­ties to devote 10 per­cent of their resources (up to 20% for smaller char­i­ties) to polit­i­cal activ­i­ties so long as they do not cross the line into party pol­i­tics. But it’s under­stand­able when peo­ple get scared and with­draw, to the detri­ment to our soci­ety which loses the expert input of these groups.

In any case, the tim­ing of the let­ter may point to polit­i­cal inter­fer­ence. It’s evi­dence for con­sid­er­a­tion, but it’s not proof.

Yet more evi­dence comes from the results of Access to Infor­ma­tion requests by the Cana­dian Cen­tre for Pol­icy Alter­na­tives, which has been under­go­ing a CRA audit into its polit­i­cal activ­i­ties since autumn 2013. CRA con­ducted a review of the web­site of the left-leaning think-tank (one of very few left-leaning think-tanks in Canada, com­pared to many more that are right-leaning) before con­clud­ing that an audit was nec­es­sary. A one-page sum­mary con­cluded that the web­site review “sug­gests that the orga­ni­za­tion may be car­ry­ing out pro­hib­ited par­ti­san polit­i­cal activ­i­ties, and that much of its research/educational mate­ri­als may be biased/one-sided.”

Though the CRA doc­u­ment referred to two prior audits of “polit­i­cal activ­ity” in 1989–90 and 2002, CCPA exec­u­tive direc­tor Bruce Camp­bell says that if CRA had pre­vi­ous con­cerns, they were not shared with the think-tank. Camp­bell also notes, and I think any­one who views the web­sites of any think-tank (e.g. the Fraser Insti­tute, the Mon­treal Eco­nomic Insti­tute) will agree, that these research insti­tutes all approach their work informed by a “core set of val­ues” though the study find­ings are based on data.

CCPA declares 1% polit­i­cal activ­ity in its annual fil­ing, so why was it sin­gled out for polit­i­cal activ­ity audits—it’s got room for nine times as much polit­i­cal activ­ity as it’s declar­ing. And why are none of the right-leaning think-tanks under­go­ing polit­i­cal activ­ity audits when their web­sites also clearly speak for cer­tain pol­icy changes?

Is it because it chal­lenges eco­nomic poli­cies of the cur­rent gov­ern­ment, such as through its annual Alter­na­tive Bud­get, while the right-leaning think-tanks come from the same philo­soph­i­cal per­spec­tive as the Harper cab­i­net and merely chal­lenge it to go even fur­ther in that direction?

At the very least, the expe­ri­ence of CCPA sup­ports the claims made to me by other char­i­ties that the CRA is chang­ing its inter­pre­ta­tions of reg­u­la­tions. Char­ity lead­ers have long been con­fused by unclear reg­u­la­tions and are now wor­ried that head­way made since 2002 in CRA com­mu­ni­ca­tions is being thrown into reverse.

There’s no smoke vis­i­ble yet. But if you sniff the gun-barrel, it seems to me that there’s increas­ing evi­dence of a recently dis­charged weapon.

But my the­sis finds that a smok­ing gun show­ing direct gov­ern­ment inter­ven­tion is not even the point in the CRA audits.

At the end of the day, I con­clude, it does not really mat­ter whether a cab­i­net min­is­ter whis­pered to a deputy min­is­ter who whis­pered to a sub­or­di­nate who made things hap­pen. If another, indi­rect, route was taken to the same effect, the result is still cor­rup­tion of the proper dis­tance between the polit­i­cal and admin­is­tra­tive arms of gov­ern­ment, I con­cluded. There’s clear evi­dence that the Harper cab­i­net is using CRA to fight its pol­icy bat­tles and view­ing as ene­mies those orga­ni­za­tions that have dif­fer­ent pol­icy ideas than the cab­i­net. I found a fun­nel pushed CRA to audit those enemy charities.

First step in the fun­nel was the over-the-top rhetoric start­ing in 2012 com­par­ing char­i­ties, par­tic­u­larly envi­ron­men­tal char­i­ties, to money-launderers, crim­i­nals, ter­ror­ists and well, un-Canadian pat­sies of US interests.

A cou­ple years ear­lier, a polit­i­cal oper­a­tive in cab­i­net min­is­ter Jason Kenney’s office had taken a leave to found Eth­i­cal Oil, an apol­o­gist orga­ni­za­tion for the Cana­dian petro­leum indus­try that refuses to answer whether it is funded by pipeline oper­a­tor Enbridge. Eth­i­cal Oil started fil­ing com­plaints against envi­ron­men­tal and other char­i­ties who were work­ing on energy-related issues that could impact on the petro­leum indus­try. The polit­i­cal oper­a­tive returned to the Con­ser­v­a­tive fold with a pro­mo­tion to the Prime Minister’s Office.

In the 2012 bud­get, after the vicious rhetoric had begun, some $8 mil­lion (now raised to $13.4 mil­lion) was allo­cated to CRA, along with spe­cific instruc­tions to, among other things, audit char­i­ties for polit­i­cal activ­i­ties. When CRA started check­ing files, they found that some char­i­ties had mul­ti­ple com­plaints against them from Eth­i­cal Oil. Guess which char­i­ties got the brunt of the first round of polit­i­cal activ­ity audits?

So, that’s the “fun­nel” that drove CRA to tar­get the char­i­ties the gov­ern­ment wanted muf­fled and dis­tracted from their mis­sions, mis­sions that got in the way of a full-steam-ahead devel­op­ment of nat­ural resources, par­tic­u­larly the oil­sands. Of course, other orga­ni­za­tions were also hurt by this activ­ity, but there are always civil­ian deaths in a bomb­ing cam­paign, and the Harper cab­i­net was treat­ing as ene­mies those orga­ni­za­tions that had dif­fer­ent pol­icy ideas on key issues.

So, a fun­nel, yes. And just as effec­tive it seems as a direct whis­per being passed through the senior ranks of CRA. Smart like a fox, if out of line with the sep­a­ra­tion of admin­is­tra­tive and polit­i­cal func­tions. And out of touch with the usual oper­a­tions of our democ­racy and the expec­ta­tions Cana­di­ans hold of their gov­ern­ment, I’d say.

Who knows what future Access to Infor­ma­tion requests will uncover, or whether the char­ity with the doc­u­ment prov­ing politi­ciza­tion, if it exists, comes for­ward? But, really: it doesn’t mat­ter whether the gov­ern­ment directly influ­enced CRA to tar­get cer­tain char­ity sec­tors with audits, or whether they con­structed a fun­nel. In either case, their rhetoric and audit­ing has muf­fled and dis­tracted char­i­ties. In either case, it was a cor­rup­tion of demo­c­ra­tic process.

Mean­while, please check out my Master’s the­sis and feel free to for­ward and tweet it. Check out media cov­er­age of my the­sis find­ings and the national con­ver­sa­tion it trig­gered. 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 com­mu­ni­ca­tion pro­fes­sional. I have been awarded the Jack Web­ster Award of Dis­tinc­tion, among oth­ers, for my report­ing and editing.

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