The charitable sector in Canada has had its causes advanced by the recommendations of a certain advisory committee to the government, over the last few years. Yet, this committee’s inner workings remain something of a mystery to the people working on the ground within the sector.

In Nov. 2018, the government of Canada announced its creation of a new, permanent Advisory Committee on the Charitable Sector (ACCS) in order to provide counsel to the Canada Revenue Agency (CRA) and the Minister of National Revenue, “on important and emerging issues facing the sector.”

The ACCS was born out of a demand for modernization of the CRA’s rules governing the charitable sector in Canada, as voiced by the 2017 report of the Consultation Panel on the Political Activities of Charities. The committee then began its work in late 2019.

The mandate laid out for the committee described the body as a “consultative forum for the Government of Canada to engage in meaningful dialogue with the charitable sector”, tasked with the duty “to advance emerging issues relating to charities,” and “to ensure the regulatory environment supports the important work that charities do.”

Three years since its inception and three released reports later, the ACCS has made a variety of recommendations to the government on a number of issues. These recommendations range from suggesting easier processes for Indigenous-led organizations within the sector to secure qualified donee status, to recommending that authorities wait for more data before increasing the 3.5 percent disbursement quota for charitable foundations to productively spend down their accumulated assets.

This raises the questions: What is the ACCS’s process to make its recommendations? Who has a voice? And what makes this body the appropriate one to be making such recommendations?

Who gets to be on the committee?

In order to answer these questions, it’s important to first know who makes up the ACCS. 

Hilary Pearson, co-chair of the ACCS, describes the body as “a committee of people from the sector, that functions as a sector committee.” 

Pearson is the former president of Philanthropic Foundations Canada and a well-known voice within the Canadian philanthropic sector. Her colleagues at the ACCS are like her — with “experience grounded in the charitable sector, including registered charities, national umbrella organizations, professional associations, charity researchers/academics, and legal experts,” according to the government of Canada’s website for the committee. She is one of 14 such ‘sector representatives’ who have been appointed to the ACCS by either the Minister of National Revenue or the Commissioner of the CRA. 

According to the government of Canada’s website for the ACCS, committee members serve different terms “to ensure continuity for the first three years.” The website further explains that, “The sector co-chairs and five members serve three-year terms, while seven sector members serve two-year terms. After the first three years, all sector members and co-chairs serve two-year terms.” The “new version” of the ACCS, with new committee members, will be appointed in August 2022, according to Pearson.

Some sector representatives who currently sit on the ACCS include — Denis Byrnes, the executive director for OXFAM Quebec, Terrance S. Carter, a legal expert in the field of charity and not-for-profit law, Peter Dinsdale, president and CEO of YMCA Canada and Paulette Senior, CEO and president of the Canadian Women’s Foundation, and more.

The ACCS has two sector co-chairs — Hilary Pearson and Bruce MacDonald — who are joined by a third committee co-chair Geoff Trueman, the Assistant Commissioner of the Legislative Policy and Regulatory Affairs Branch of the CRA. Further, the CRA’s Charities Directorate, and Finance Canada each have a representative that sits on the ACCS. 

However, these officials are not the ones in charge of actually making the decisions that would ensure action on a certain recommendation. Pearson explains that while Trueman and his colleagues at the CRA are “really taking our role very seriously, as one that is helpful advice to them,” the ACCS actually makes recommendations to the Minister of National Revenue — Diane Lebouthillier. “Technically she’s [the Minister] our person, up to now, to whom we direct our recommendations and who should be getting back to us with any decision on the recommendation,” she explains.

The Minister of National Revenue is also responsible for the appointment of committee members like Pearson — which includes one Black member and one Indigenous member.

But one of the key reasons the ACCS was put together in the first place, was because marginalized communities across Canada were already experiencing the effects of a lack of diversity within decision-makers at the CRA. 

For instance, a recent report published by the International Civil Liberties Monitoring Group found that 75 percent of the organizations whose applications for charitable status were revoked between 2008 and 2015 were Muslim charities. 

Philanthropic organizations supporting Mulism communities across Canada further felt the effect of this discrimination in the form of a lack of charitable dollars, when the need for social services and support was at a high in the aftermath of a targeted attack against a Muslim family of four in London, Ontario earlier this year. In July, the CBC reported national revenue minister Diane Lebouthillier had announced that the government would ensure that the ACCS, “which guides all departmental policy”, would have a Muslim representative present at the table. 

While the ACCS does have a policy to ensure “continuity” by rotating its members out and accepting new members at varied intervals, Pearson says that there are no stipulated policies on diversity and inclusion at the moment. The same committee members are still making recommendations on issues that marginalized groups — like Muslims in Canada — face, without the direct participation of representatives of these groups in the ACCS’s internal process. 

Yet, Pearson explains that it is the lived and working experience that each ‘sector’ committee member brings to the table that initially drove the ACCS to identify certain key issues surrounding which it would make recommendations. 

How does the ACCS decide what to work on?

Pearson explains that at the very outset of the committee’s work in 2019, the members held a ‘priority-setting’ exercise to identify certain key issues facing the sector. 

The exercise was facilitated by the committee co-chairs who opened the floor to a “round-table discussion,” according to Pearson, who explains that this was the starting point to the ACCS identifying the key issues or areas surrounding which it would make recommendations. “That priority exercise was really all of us as 14 people kind of coming together with all of our different backgrounds and experiences,” she says.

Pearson says that the committee took a “collaborative approach” to discussion without a provision for  any sort of veto power. According to Pearson, the success of this exercise has compelled the committee to mandate that its newly appointed version kick-off their term too, by holding yet another priority-setting exercise in August 2022. “Everyone was able to name the issues that we thought were important to the committee… and then we had the Senate report’s previous recommendations as well. We were building on what was already a body of work,” she explains. 

In June 2019, the Special Senate Committee on the Charitable Sector put out a report detailing 42 recommendations, that it describes as a “roadmap to ensure that genuine change is delivered so that the sector can reach from great to exceptional.” The report, which made a variety of recommendations regarding people in the sector, sector funding, sector support through modernization of regulatory framework, and more. The report further states that it “trusts that the federal government, together with the Advisory Committee on the Charitable Sector, will work swiftly to implement its recommendations.”

“We were certainly looking at those recommendations and realizing that the ones that can further our mandate are limited to regulatory issues, because we advise the Minister of Revenue…We couldn’t really go beyond that too much. In other words, we couldn’t take on questions of, say, human resources in the sector, unless that was something that was shaped by regulation. But we interpreted it [the committee’s mandate] pretty broadly,” she says. 

The result of this “broad interpretation” of the ACCS’s mandate, through the priority-setting exercise, was the creation of five ‘working groups’ within the committee that were each assigned a ‘priority’ or issue facing the charitable sector in Canada. The co-chairs and sector members each comprise more than one of these working groups. Collectively, the working groups as the advisory committee have put out three reports thus far. 

So, what issues do they work on?

The different working groups within the ACCS are as follows: Regulatory Framework

Working Group (RFWG), Vulnerable Populations Working Group (VPWG), Indigenous

Peoples Working Group (IPWG), Purposes and Activities Working Group (PAWG) and the Charitable Sector Data Working Group (CSDWG). 

The groups’ priorities are accordingly, to focus on the regulatory framework within the government in relation to the charitable sector, supporting the work of charities that serve vulnerable populations, issues faced by Indigenous Peoples seeking to participate in Canadian philanthropy, assessing the regulatory approach that is taken towards charitable purposes and activities, and data collection and analysis. 

Arlene MacDonald, a member of the ACCS and lead on the Charitable Sector Data Working Group (CSDWG), is one of five working group-members who were tasked with “improving data collection and analysis related to the charitable sector,” according to the committee’s website. 

As in her work within the group on data surrounding the charitable sector, MacDonald says that each working group must do a lot of research and consultation before making any submissions for recommendations. Data, especially, informs the recommendations that the ACCS makes. 

Who and what does the ACCS consult before making a recommendation?

As an example, when MacDonald found herself working on data collection for the committee’s submission to Finance Canada on disbursement quota (DQ) reform, she explains that “We, for example, met with some of the voices that have been louder around the DQ, some of the voices that have been quite passionate about it. We met with the sector — the Federation of Voluntary Sector Networks, and they are industry councils and voluntary networks within each of their provinces who have memberships within the sector that number in the thousands. We’ve also met with different foundations throughout the data collection process and tried to listen to and join conversations that were already happening around DQ.” 

MacDonald says that her team also met with some researchers at Carleton University, Statistics Canada and the Department of Finance when they were working to collect information for their submission. She says, “We’ve also met with some intermediaries like Capital W, we’re both working on data to get that clean T3010 data that’s non-interpretive.”

According to the final submission put out in August this year by the ACCS, “The T3010 can provide information on the total assets held by private and public foundations.” The report found 2019 data confirmed that assets held by these foundations have continued to increase, whilst the disbursement quota that mandates organizations to spend those assets down on the causes that need charitable dollars, stagnates at 3.5 percent. 

In the case of the submission on disbursement quotas, MacDonald says that the report’s recommendations were “driven by the data,” that the group collected.

Pearson explains that this especially statistic-informed approach to recommendation-making is taken because, “We don’t see ourselves as an advocacy group… We see ourselves as an advisory group actually created by and for the government. So, we can’t advocate for a particular position but we advise.” 

Advice, not advocacy

The ‘advice, not advocacy’ approach is taken across the working groups of the ACCS, and the results of their work have been the recommendations made in three reports  that the committee has published thus far.

Some of the other recommendations, based on what the ACCS heard in their conversations with organizations in Canada’s charitable and philanthropic sector, include: considering new guidance on the categorization of earned income, expanding awareness of the CRA’s “education first” approach in order to combat the “level of concern or ‘fear’ felt by many charities in approaching the Charities Directorate, worried that drawing attention from the Agency might lead to closer review or an audit,” and to improve the accessibility to information through “communication, education, and guidance products,” keeping in mind language barriers and the lack of access to professional services that some smaller charities presently face. 

What happens after the ACCS makes a recommendation?

Pearson says that while the committee continues to work to advance the voices of and issues facing Canada’s charitable sector, one can not expect to see immediate results of the recommendations that they put forward to the government. “I think whatever impact they have, will be much more longer-term,” she says, as many of the recommendations made by the committee remain yet to be acted upon. 

Whilst the mandate of the ACCS is focussed on recommendation-making, Pearson explains that it leaves little room for measuring the effects of those recommendations. “I’ll be honest, I don’t know that there is a process or a framework set up around the committee to actually rigorously measure impact, so as for us to be able to confidently say what it has been,” she says. 

Who holds the government accountable?

When it comes to holding the government accountable to ensure that definitive action is taken upon their recommendations, MacDonald says, “We’re an appointed committee, by the government. So it’s just suggestions or recommendations that can be put forward. And what happens with them? Really, it’s beyond our control.”

The lack of clarity and control on this front is not dissimilar to that which the committee faces regarding diversity and inclusion policies for appointment of ACCS committee members. Further, Pearson says that while nominations are made to the Minister of Revenue for committee members, there is no transparency to that list of nominations. She adds, “We don’t really have any control over the composition of the committee. That’s going to be the minister’s call.”

Room for improvement

However, MacDonald says she holds the hope that a lack of clarity could mean room for evolution within the ACCS’s mandate, that would allow for the committee to take the necessary steps to make meaningful, actionable recommendations on issues facing the charitable sector in Canada. 

“For so long before this, there’s been so little ability of this sector to have conversation with their provincial governments or with the federal governments,” says Pearson, who explains that the biggest value of this still-new committee lies in the fact that it is a, “formal, ongoing, permanent structure that allows the sector on a kind of broad basis to feed information in, get advice in, raise issues with, have discussions around a table with people who are decision makers in the federal government.”

But in order to continue doing so, she says, “I do think it is on us to communicate effectively out to the sector that this is what we’re trying to do, this is what we want to do on your behalf, this is how you can communicate with us, this is what we want to hear from you about. Focussing on that is going to be our next step.” 

Pearson explains, “We really want to try and act as a two way communication channel. So it’s not just us, representing the sector pushing information into government; we would really like to have a dialogue back out again, with the sector and learn more about what we need to do. I think going forward, that’ll be something that I hope the next version of the committee will continue to push for and expand.”

This story has been updated to reflect that the ACCS has one Indigenous member and one Black member. A previous version of the story falsely claimed all but one member of the committee were white-passing. Future of Good sincerely regrets the error.

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