The sector deserves better: Missed opportunities in the federal response to the Senate report on the charitable sector

Last month, the federal government released its response to Catalyst for Change, the 2019 report of the Special Senate Committee on the Charitable Sector. The government response, long in coming, is underwhelming and does a great disservice to the tens of thousands of charities and nonprofits that have stepped up during COVID-19 to meet the needs of communities. This is a missed opportunity for a partnership-oriented response and call to action. Worryingly, elements of the commentary demonstrate a flawed understanding of the nonprofit sector in terms of its challenges and its potential. Here’s our analysis:

• The government has not committed to implement significant new initiatives within a firm timeframe, whether a home in government for the sector, changes in direction and control that make shared platforms easier, equal access to business development supports provided to for-profit companies, or a human resources strategy for the sector.
• In policy areas where government has agreed to review an issue, there is no sense of urgency, nor is there a commitment to find sector-government solutions. For instance, the Canada Revenue Agency (CRA) was asked to revise its interpretation of the “not-for-profit purpose rule” so there is clarity about nonprofits’ ability to generate and reinvest surplus funds. This is not a new problem. CRA undertook a three-year research project in 2010- 2013 and unearthed the issue. This pace of response to legitimate sector concerns would not be tolerated in any other sector.
• The government has referred many significant and substantial issues to the Advisory Committee on the Charitable Sector which has already begun to release reports that substantiate the Senate committee recommendations. Let’s hope the response to these reports is more prompt and action-filled than the federal government’s response to Catalyst for Change
  As Canada emerges from the pandemic, the essential supports in our communities provided by the nonprofit sector will be critical. Government must re-commit to partnering with the nonprofit sector to rebuild communities and people’s lives, and create systems change by tackling economic inequity and empowering Black and Indigenous communities, and addressing the climate crisis. We urge the federal government to take the nonprofit sector’s issues seriously and to accelerate the changes we need. Let’s hope the more encouraging federal budget, rather than the tepid response to the Senate report, sets the tone for a reset for the relationship.