Government of Alberta’s Public Inquiry into Environmental Groups
By Lina Khatib, CCVO Policy Analyst
Last month, Premier Jason Kenney announced that the government will launch a public inquiry into the foreign funding sources of environmental groups who are critical of Alberta’s energy sector policies. Before that, Premier Kenney promised to establish an ‘Energy War Room’ to respond to campaigns directed at Alberta's oil and gas sector. The combination of the public inquiry and the war room, among other tactics, are being framed as efforts to bring prosperity back to Alberta’s oil and gas industry. Here is what we know and how we think it might impact the nonprofit sector, particularly organizations that hold charitable status designation through the Canada Revenue Agency (CRA).
Advocacy Chill: Different Players, Same Game
It wasn’t very long ago that the previous federal Conservative government heightened scrutiny around the work of environmental charities by conducting a special audit through the Canada Revenue Agency. The scope of the audits expanded beyond environmental charities, to include human rights and anti-poverty charities, among others. Although the audit process varied in intensity and extent across organizations, the era is now commonly recognized as creating an ‘advocacy chill’. Major developments have eased this chill but have not removed its effects entirely.
In July 2018, an Ontario Court ruled that limiting political activities of charities amounts to an infringement of freedom of expression. This ruling gave charities the freedom to engage in nonpartisan public policy advocacy without fear of it resulting in a challenge to their charitable status.
The federal Income Tax Act has been updated to remove limits on charities from participating in political activities.
It is currently legal for environmental groups to accept foreign funding. In fact, foreign funding is accepted by groups well beyond the world of nonprofits. The oil patch in Alberta relies significantly on foreign money, and the amount of foreign funding going to those opposing the industry has been largely exaggerated. Nonetheless, the provincial government has identified individual environmental organizations that it intends to question throughout the public inquiry. Several of the named organizations are also registered charities with the CRA, which likely means they will be under closer scrutiny because of their tax-exempt status.
Impacts within Alberta
We believe that this inquiry could lead to a broader questioning around the source of philanthropic money that is used to fund the advocacy work of some registered charitable organizations. Additional concerns for these organizations will include the potential for loss of charitable status, loss of funding, and risks to the reputation of the organization. The financial impact is related to the potential legal fees that organizations could incur, and the potential for cuts to provincial government grants. Foundations themselves might question whether they want to continue being involved in funding charities who are engaged in public policy advocacy.
The inquiry in Alberta has been given a $2.5 million budget and will begin with an information review, including interviewing witnesses, followed by a public hearing. The inquiry will be led by Steve Allan, who will be required to submit an interim report to government by January 31, 2020 and a final report by July 2, 2020.
Impacts Beyond Alberta
The inquiry is currently limited to Alberta. The commissioner of the inquiry, Steve Allan, has said that he is considering asking other provinces for jurisdiction that would allow him to compel witness testimony and evidence elsewhere in Canada. This is very significant from a broader charitable sector perspective, especially as it relates to safeguarding the recent Federal Income Tax Act changes.
What Nonprofits Can Do
Charities, and nonprofits in general, have a history of taking positions on matters of public interest. It is a risk to the democratic process when any order of government treats certain groups as opponents because their contributions to public policy conversations differ from the government’s priorities. Good public debate allows for the inclusion of all voices. In a recent Globe and Mail article on the topic of civil society, CCVO’s President & CEO, David Mitchell, states: “The Pembina Institute, an environmental think tank focused on energy and climate change, may be at odds with an industry group such as the Canadian Association of Petroleum Producers, but both are important parts of civil society.”
There is a role for the nonprofit sector to play in the public inquiry. Environmental groups can use the inquiry to showcase their transparency and to reinforce the good work that they do. Many have noted that the information being requested, such as funding sources, is already publicly available online. More broadly, this inquiry presents an opportunity to talk about the responsible and crucial ways that nonprofits engage in public policy dialogue. Our sector has an opportunity to help reframe and continue the conversation, and provide vital information to shape important public policy discussions.
As the public inquiry unfolds, CCVO will be sharing information and analyzing the impacts on nonprofits so that you can stay up-to-date and informed on this important issue.