COVID-19 exposes fault lines in charitable sector
This spring has stretched Canadians to the brink as the world around us changes almost daily. Over the last two decades, the charitable sector has expanded to fill gaps in existing government programs countrywide, and COVID-19 exposes long-standing challenges that put these organizations and the communities they serve in grave danger.
Imagine Canada, a national organization representing the interests of charities, non-profits and social entrepreneurs, recently fielded a survey of 1,400 charities and nonprofits to understand these challenges.
Sixty-nine per cent say revenues decreased since the pandemic’s onset, about double the number that reported a decline during the 2008-09 recession.
YWCA Canada, a national organization advocating for women, girls and gender-diverse peoples, faces the cancellation of over 200 fundraisers. While it will move some events online, large-scale public events like Walk a Mile in Her Shoes, which represents 10 to 20 per cent of annual revenues, are impossible in the era of social distancing.
Maya Roy, CEO of YWCA Canada, says it’s essential for charities and nonprofits to operate at full capacity when they’re most needed.
While Canadians are told to wash their hands frequently, half of all Indigenous communities don’t have clean running water. YWCA Canada, alongside emergency humanitarian-aid group GlobalMedic, is working to deliver hand sanitizer to YWCA’s Arctic shelters.
Most organizations maintain limited reserve funds, as keeping more cash on hand would restrict their eligibility for some government and private sector grants. An unprecedented event like COVID-19 leaves them unable to fill funding gaps.
Even organizations with annual funding fear for the post-pandemic future. The Nanaimo Brain Injury Society (NBIS) is ineligible for the Canadian Emergency Wage Subsidy due to its funding cycle.
Kix Citton, executive director, anticipates receiving less government funding due to pandemic-related deficits when NBIS applies for 2021 funding in December.
The organization’s private funders are now asking NBIS to redirect funding toward COVID-19-related issues while it struggles to maintain regular programming.
One example is a program that fills the gap between hospital and home for people with newly acquired brain injuries.
NBIS assists clients in accessing local and provincial aid programs and community services, and provides peer-support volunteers who can offer advice and encouragement.
NBIS recently applied for a health authority grant to purchase iPads to run the program while volunteers can’t visit hospitals.
Funding losses affect an organization’s ability to maintain the staff running essential programs. Currently, 30 per cent of charities have laid off staff, compared to 24 per cent during the entirety of the last recession. More than half say they may need to lay off additional staff or begin laying off staff where they haven’t already.
Boys and Girls Clubs of South Coast B.C. offers programs to support mentorship and positive peer relationships for youth. While the organization is committed to providing kids with support throughout the pandemic, fundraising revenue is down 40 per cent and corporate sponsorships are on the decline.
President and CEO Carolyn Tuckwell knows the downward trends are likely to continue, despite the increased need for their work to reduce the academic and social impacts of isolation following the pandemic.
The issues charities and nonprofits face aren’t new, but they are exacerbated by COVID-19.
A 2019 senate report titled Catalyst for Change: A Roadmap to a Stronger Charitable Sector recognized these and other pressing challenges.
“While the sector is resilient and innovative, its potential is limited by what are seen by many stakeholders as complex, outdated rules and a lack of coordinated support within the federal government,” it reads.
The sector is a vital employer of 2.4 million Canadians, 70 per cent of which are women, and a critical engine of economic growth accounting for 8.4 per cent of GDP.
Imagine Canada’s early predications show the sector faces a loss of $9 billion to $15 billion in revenues due to COVID-19. These projections are likely optimistic.
The challenges Canadian charities and nonprofits face today are dire, but they highlight opportunities to revitalize the sector. Building financial stability and stronger infrastructure to weather future crises will ensure the sector’s ability to support Canadians from all walks of life during the recovery.