Charities, ‘political activity’ and free speech

Federal decision to appeal ruling is disappointing, Pearl Eliadis says.

An Ontario court recently issued one of the most important free speech rulings in Canada in years.

On July 16, Justice Edward Morgan of Ontario’s Superior Court of Justice ruled that limits imposed by the Canada Revenue Agency (CRA) that muzzle charities are arbitrary and violate freedom of expression under the Canadian Charter of Rights and Freedoms.

But now, the federal government has announced it will appeal the ruling.

According to Imagine Canada, there are about 85,000 charities in Canada. Two million people work in the charitable and nonprofit sector and 12.5 million Canadians volunteer. That is a lot of people who have a lot to say, but if they are doing so through a charity — the vehicle of choice for millions — their expression is severely restricted if it is deemed public advocacy, or what the CRA calls “political activities.”

It’s not exactly clear what non-partisan “political activities” actually means. Partisan political activities are, of course, off-limits. No charity should be allowed to support or oppose political parties or candidates. But non-partisan “political activities” restrictions (the kind at issue in this case) may place limits on activities like open letters, social media campaigns, research, consultations and public engagement, if the goal is to change government decisions, policies or legislation.

The CRA rule was that only 10 per cent of a charity’s resources could be devoted these activities.

Under the Harper government, the 10 per cent rule was put on steroids and unleashed against several charities.

The CRA also used other tactics, like deciding that well-established charitable purposes were no longer charitable at all, or using lengthy, punitive audits. The targeted groups? Canadian Mennonite, PEN Canada, Oxfam, Alternatives, Amnesty International, and a slew of environmental organizations.

What they appeared to have in common was that their views ran afoul of the government of the day.

After the federal Liberals were elected in 2015, they promised to stop harassing charities. The political activities audits were suspended, but not cancelled. The restrictions on public advocacy remained on the books.

A tiny but mighty organization called Canada Without Poverty (CWP) challenged the long-standing and oppressive 10 per cent rule and its limits on free speech after the CRA had found that most of CWP’s work was focused on efforts to reform the law, seek policy change and encourage public participation in governmental forums and other democratic processes. All these activities sought to promote awareness of the challenges of living with poverty and to support measures for the relief of poverty. CWP was told it would lose its charitable status.

The judge struck down as unconstitutional the provision of the Income Tax Act that muzzled charities. He understood that anti-poverty work is no longer about just giving alms.

He recognized international norms that emphasize the importance of communicating with the public and engaging with poor people themselves.

Justice Morgan cited an earlier Supreme Court of Canada ruling that said, “where a government chooses to provide, it must do so in a fashion that is consistent with the Constitution.”

In response, the government announced on Aug. 15 that it would repeal the section of the Income Tax Act that allows the CRA to muzzle charities.

That was good news. But in the same breath, it announced that it would appeal the ruling on Charter grounds.

This is regrettable. By granting the policy win, the government acknowledges the problem and the fix, but by refusing to recognize the free speech aspect, any government will be able to change the law back and muzzle charities once again.

Groups fighting poverty and injustice, those who can least afford the fight, will once again have to spend precious resources before the courts to defend the rights of millions of Canadians.

Pearl Eliadis is a human rights lawyer based in Montreal and has worked with Canadians for Free Speech and Voices-Voix.