Charities push back against Liberals on political audits

Some Canadian charities are reviving a campaign to get tax auditors off their backs after the Liberal government delivered what the charities say is a half-measure in ending "political harassment," a promise from the 2015 election campaign.

More than a dozen groups, including the Sierra Club Foundation and Environmental Defence, launched a letter-writing campaign and petition this week calling on the Liberal government to stop all political-activity audits started by the Harper Conservatives in 2012. (The World Wildlife Fund was initially identified as part of the coalition, but later said its inclusion was an error.) 

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"Charities under audit for political activities from the previous government are still under audit," says a statement on a website, created by a charities coalition last year.

"These audits need to end immediately. Reform of the rules that allowed these audits must begin."

Some 54 charities were caught by CRA's political-activities audits, and five were given notice they would lose their charitable registrations, meaning they could not offer tax receipts to donors.

Critics have said the rules restricting political activities are unclear, and that the audits effectively gagged some groups, a phenomenon dubbed "advocacy chill."

Optimism dampened

The charities sector had been heartened by the Liberals' platform, which promised to "allow charities to do their work on behalf of Canadians free from political harassment."

But the optimism was soon dampened. On Jan. 20, National Revenue Minister Diane Lebouthillier said 24 political-activity audits currently underway will continue their course, and the five groups under notice of deregistration will not be spared, though they can appeal.

The only change was that auditors would be stood down in six cases of charities scheduled for political-activity audits that had not yet begun, and the $13.4-million program would eventually be wound up.

Tim Gray, executive director of Environmental Defence, which is facing deregistration, said in an interview: "Let's recognize what actually happened with the previous government and put an end to this.

"We are trying to escalate the importance of action on this issue. So we're going to relaunch and encourage people to contact the minister and the prime minister to get them to act on their commitments."

Canada's most popular and important charities [are likely] heading toward decertification and oblivion- activist Gareth Kirkby

Some groups, including the tiny Canada Without Poverty, have been under continuous political-activity audit for four years, a drain on their limited money and staff – and with no conclusion in sight.

Gareth Kirkby, a Vancouver-based charities activist who has researched the political-activity audit program, says Liberal inaction likely spells doom for some groups.

"The Trudeau government's timidity so far in fixing this abuse of power by the previous government will probably result in some of Canada's most popular and important charities heading toward decertification and oblivion," he wrote in a recent blog post.

The government should "stop the current 24 audits in their tracks" and "grandfather the remaining members of the five charities that have lost their status but not yet been fully shut down."

Principle protected

However, the minister says she will not interfere with the auditing process.

"The independence of the Charity Directorate's oversight role for charities is a fundamental principle that must be protected," Lebouthillier said in a statement Monday to CBC News. "I cannot and will not play a role in the selection of charity audits or in the decisions relating to the outcomes of those audits.

"There are 24 more audits already underway and scheduled for completion," she said. "These audits will continue so that the CRA can address any serious deficiencies, consistent with the approach used in the regular charities audit program."

The Conservative government announced the five-year political-activity program in the 2012 budget, at the same time as cabinet ministers were denouncing environmental groups for their opposition to pipeline and energy policies.

The initial wave of audits concentrated on environmental groups, including Environmental Defence, but in later years expanded to cover human-rights, international-aid and poverty groups. One group, Dying With Dignity Canada, had its charitable registration annulled after a political-activity audit, and another small group surrendered its registration after being given notice of revocation.

The Canadian Centre for Policy Alternatives, a left-leaning Ottawa think tank, remains under a political-activity audit that was launched, in part, because its publications showed "bias," according to an internal CRA document the group obtained under the Access to Information Act.

Current rules allow charities to devote up to 10 per cent of their resources to political activities, though definitions are often in dispute. Partisan activities, such as endorsing a party or candidate, are strictly forbidden. About 500 of Canada's 86,000 charities report conducting political activities.

The previous Conservative government defended the program, saying there was no political direction given to Canada Revenue Agency about which groups to target. And the Canada Revenue Agency said it spread the political-audits fairly, across sectors and regions, using objective selection criteria.

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