Charities are not what they appear to be

Merriam-Webster’s first definition of the word charity* is: “generosity and helpfulness especially toward the needy or suffering”. Most Canadians have probably wondered since the “WE Charity” scandal broke, how that definition fits into the CRA’s granting of charitable status to applicants and then how they administer them from that point. 

Well, presumably to put our minds at ease, the CRA recently released a “Report on the Charities Program 2018 to 2020” and they applaud themselves.  As an example, the Director General, Tony Manconi in his overview noted the Charities Directorate: “aims to promote compliance with the charity-related income tax legislation and regulations in order to support charitable giving and development of the sector, while protecting charities and the public from abuse.”

The foregoing is to suggest we taxpayers should relax as those within the CRA are managing the charities really well, but are they? 

From all appearances the MSM totally ignored the CRA report as a search for responses to it suggests the only parties who even looked at it were a couple of law firms and a few charities.  

Should one scan the following chart which provides the sources of revenue flowing to charities over the “annual average” of the years 2016 to 2018 it is rather shocking to note 86.6% ($183.9 billion) was labelled as “Revenue from Government”. A cursory look at some of the CRA charities labeled “universities” or “hospitals” suggest this is where the bulk of that “Government Revenue” flowed. The CRA’s report notes as of the end of 2019 there were still 4975 “Public Foundations” down from 5027 in 2018.

Curiosity piqued; an examination of The Governing Council of the University of Toronto’s CRA filings followed which led to the discovery over the five years of their filed reports they had received $5.157 billion collectively from Federal, Provincial and Municipal governments.  They have 61 people on the “Governing Council” and 10 of them (probably many more) have incomes exceeding $350K per annum.  A look at the Ontario “Sunshine list” for “universities” show 10 of the top 20 names on the list were U. of T. employees with the lowest earning almost $458K in 2019.

U. of T. employees reputedly number about 15,600 operating on three campuses and the April 30, 2020 CRA filing indicates total compensation of $2.3 billion which suggests average income of $147K per employee and represented about 65% of U. of T’s gross revenue of $3.54 billion.

Some of the $1,043 million U. of T. received in their year-ended April 30, 2020 from the various governments (paid by taxpayers) flows to University of Toronto Asset Management Corporation (UTAM) established in April 2000. UTAM have responsibility to manage three U. of T. pools of funds which are; the Long Term Capital Appreciation Pool (assets from endowments) of $3.2 billion, the Expendable Funds Investment Pool (short-term working capital) of $2.5 billion and the University of Toronto Master Trust (Pension Fund) of $5.6 billion. So UTAM were managing (as of December 31, 2019) assets of $11.4 billion much of which us kindly taxpayers contributed over the years. 

Further, and as a matter of interest, UTAM have gone full blown ESG (environmental, social and governance) signing up to the UN PRI (principles for responsible investment) back in December 2016. They have obviously bought into the new economic theories pushed by the WEF and many others including our former Bank of Canada governor, Mark Carney!  They even have a picture of industrial wind turbines on the website to augment their belief in ESG. No doubt, if UTAM come up short and unable to generate sufficient revenue in their management of the pension fund the university will go hat in hand to the various government bodies and seek more of our private sector tax dollars!

Now, returning to the CRA report another interesting disclosure was the fact charities as of December 31, 2020 had filed over 91,000 applications for the Canada Emergency Wage Subsidy (CEWS) and almost all of them were approved.  That resulted in another $2.4 billion of tax dollars flowing to charities (with employees such as U. of T.) and one should imagine many of those dollars flowed to the lower paid employees within the various universities, colleges, and other public sector charities as well as to many environmental groups such as WWF, Pembina Foundation, Environmental Defence, etc. etc.

Canada is in need of new legislation in respect to charities in order to meet the true definition of what a charity really is. 

The public is being abused despite the rhetoric from the Director General!

*To be clear I am a member of a charity but it is a “not for profit” so doesn’t issue tax receipts and has no paid employees but we do our best to help the needy and contribute to the community!

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