Charities – Caught in the Crosshairs

Katherine's picture

There has been little change in the rate of volunteering and giving over the past decade, according to the Canada Survey on Giving, Volunteering and Participating. In 2010, just under half of Canadians aged 15 and older (47%) volunteered with a charitable or nonprofit organization, up from 45% in 2004. The rate of giving is significantly higher at 84% but again – no change. Average annual donations in fact fell between 2007 and 2010, from $457 to $446.

The charitable and nonprofit sector has been watching these trends with some concern. Increasingly a small proportion of volunteers and donors do most of the work and play the most significant role in funding charitable organizations. In 2010, 10% of volunteers accounted for 53% of all the volunteer hours, while the 25% of donors who made the largest contributions accounted for 83% of total donations.

The charitable and nonprofit sector plays a critical role in Canada providing essential services and supports to people and creating vibrant communities. In economic terms, the value of the sector is over $100 billion (including hospitals and universities), accounting for 7% of the total economy (Statistics Canada, 2009).

At the same time, growing demands – and decreasing resources – are challenging the sector’s ability to meet the needs of Canadians, especially in light of ongoing economic uncertainty. About half of charities report increased demand for services since the recession, a similar percentage state that they are having difficulty fulfilling their mission, and fully one-quarter state that their existence is at risk (Sector Monitor, February 2012).

Is anyone listening?

At the federal level, an outline of a new “community agenda” is only now beginning to emerge. But the government is not talking about developing a new Voluntary Sector Accord with the charitable sector of the type negotiated by the Chretien administration back in 2001. Rather, the Human Resources Minister, Diane Finley has expressed interest in introducing new funding arrangements such as Social Impact Bonds that tie payment to non-profit groups for services to performance targets, expanding the number of private saving vehicles for families to provide for their own members, and encouraging greater involvement of the for-profit sector in addressing social challenges.1 And, over at the House of Commons, the Standing Committee on Finance is studying tax incentives to encourage greater charitable giving.

This new community agenda is all about individuals, families, communities, charities and businesses stepping up … as government steps away.

In the UK, Prime Minister David Cameron is engaged in his own campaign called ‘Big Society’ to wrest power away from central government and into the hands of citizens. His plan calls for the devolution of authority for the provision of social services to local authorities, opening up competition for the delivery of public services to social enterprises and the private sector, and instituting new incentives for volunteering and giving.

And that’s the difference this time around. Both in Canada and the United Kingdom, the new community agenda is being advanced lock-step with deep cuts to public services and the charitable sector (See Smoke and Mirrors: What Budget 2012 Really Delivered). It is no wonder that Big Society has become a toxic brand in the UK and that in a recent poll, 58% of respondents agreed with the statement: “it’s mostly just hot air, and is being used as a cover for government cuts.”2

“Fostering and tapping into the potential of civil society for common purpose is an old and worthy idea. Reinterpreting it, in tension with the ideals, principles and practices of modern liberal democracy and in the context of global capitalism, is one of the great political challenges of our times.”3

At least in Britain, there is an active debate about the respective roles of the state and civil society – a debate about which we can only dream in Canada (See Bill C-38: An Omnibus by any other Name). At the same time Minister Finley was highlighting social innovation in the charitable sector, federal Finance Minister Jim Flaherty was putting the final touches on the federal budget that included an explicit attack on environmental charities raising concerns at the Northern Pipeline Review and an increase of funding for the Canada Revenue Agency to conduct charitable audits.

Canadians provide generous support to the charitable sector but government also has a vital role to play in enacting programs that bring help to those in need and support economic opportunity for all. Reducing taxes and public services in the hope that individual Canadians and the charitable sector will take up the slack under the guise of a new community agenda will only result in growing disparity and need. Charities and individuals simply can’t do it on their own.

We need a renewed community agenda in Canada, one built on respect, meaningful engagement, and a positive vision of what Canadians can do together.

  1. 1. Minister Diane Finley (March 2012), Speech Notes for the 2012 Manning Networking Conference: Addressing Social Challenges by Empowering Individuals and Communities,” March 9, 2012, Ottawa Convention Centre.
  2. 2. Cited in Elizabeth Renzetti (2011), “Britain’s `Big Society:’ Noble experiment in volunteerism or cynical politics,” The Globe and Mail, October 28, 2011.
  3. 3. Carolyn Hughes Tuohy (2011), “Small is big: Red Toryism and the political debate in Britain,” Policy Options, May 2011, p. 53.
Katherine Scott is CPJ's Research Associate.

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