How will the Federal Government Support Charities During the Pandemic? | Senator Dalphond & Senator Coyle

On April 11, 2020 Senator Pierre Dalphond asked Finance Minister Bill Morneau how the government plans to support non-profit organizations during the outbreak of COVID-19.

Senator Dalphond: The next question is about this wage subsidy program. How is it adjusted to take into consideration the particularities of the charities as suggested by my colleague Senator Omidvar from Toronto? I think she wrote to you about that.

Mr. Morneau: We found that for the charitable sector, first and foremost, in many cases they were going to be facing the same issues as other organizations — significant decline in revenues. However, it would be particular in the charitable sector in the sense that some charities would not be losing money if they had government sources of revenue because that government source of revenue might not go away, but they would be losing all their donations. For other charities, they might have government sources of revenue because governments might actually be paying their daily stipend, for example, if you’re in a shelter or something. For those charitable organizations, we decided to choose whether or not to include government revenues in their test for whether their revenue went down.

For example, if you were in a situation where you had government revenue, you just had your donations go down and that government revenue was stable, you could not use the government revenue and just demonstrate donations went down. If you’re in a situation where you had government revenue that went down because of your source, you could use it and show that it went down significantly.

We’ve given a double test for charities that we think puts them in a position to demonstrate their challenge. And then, of course, we have specific supports for certain kinds of organizations — food banks, shelters, as you just mentioned — that are particularly challenged during this time. We’re going to continue to think about organizations that are effectively support mechanisms for people during this time. We need to find a way that they have the resources that they need.

On April 11, 2020 Senator Mary Coyle gave a speech in support of Bill C-14. In her speech, Senator Coyle discussed the critical role that the charitable sector plays in Canada and around the world, as well as the need to support this vital sector during the pandemic.

Senator Coyle: I support this bill and the other unprecedented and extensive measures our government has rapidly put into place to help Canadians get through to the other side of this crisis. I was very pleased to see that this bill recognizes the importance of both the business sector as well as the charitable and non-profit sectors. Providing job security and support for operational continuation is key for both sectors. It’s key for all Canadians.

Honourable senators, our Special Senate Committee on the Charitable Sector highlighted the critical role that this sector plays in Canada and around the world. At a time when the sector is needed more than ever, Imagine Canada has estimated that charities will see financial losses this year of $9.5 billion to $15.7 billion, as well as layoffs of 118,000 to 194,000 people. That’s the charitable sector.

With this potentially dire and urgent situation, charities need to be supported by the right policy tools so they can continue their vital work responding to the impacts of this crisis. The 75% wage subsidy provided through this bill, and described in detail by Senator Gold in his speech, will definitely help many charities to keep their doors open. For this we are thankful. There are, however, a number of other measures the sector is asking the government to consider, given the distinct characteristics of this sector.

The charitable sector is asking for a whole-of-government approach and asking the Treasury Board to issue a directive to that effect. The measures they are asking for also include adjustments to the way declines in revenue are calculated. Charities with funding agreements with the federal government and Crown agencies would have those automatically renewed. Unspent funds from previous years would be carried over. Flexibility on how funds are spent would need to be there, as well as simplified reporting requirements — yes, more offence and less defence from the government, please — and a temporary moratorium on the restrictions that limit charities and foundations to only provide funds to qualified donees, in order that they may form the critical partnerships required to reach vulnerable populations at this time, including Indigenous peoples. And, just as government is looking at developing specialized relief for industries, such as our airlines, the charitable sector is calling on the government to create a significant stabilization fund tailored to its urgent needs.

Honourable senators, these are not frivolous asks. These are essential supports for a sector working hard every day to help fellow Canadians get through this crisis.