WE Charity lays off staff due to pandemic, registers as lobbyist

Organization scaling back operations, looking to sell its real estate holdings

OTTAWA— WE Charity registered Thursday as a lobbyist of the federal government — months after it began talks with federal officials about potential programs to help Canadian youths during the COVID-19 pandemic.

The organization’s executive director, Dalal Al-Waheidi, disclosed the registration during testimony before the House of Commons finance committee, which is probing the controversy surrounding the Liberal government’s decision to pay WE Charity up to $43.5 million to administer a now-abandoned student grant program.

The controversy has triggered investigations by the federal ethics watchdog into potential breaches of conflict of interest rules by Prime Minister Justin Trudeau and Finance Minister Bill Morneau, both of whom have close family ties to WE Charity.

And it was blamed at least in part for WE Charity’s announcement earlier Thursday that it is scaling back its operations, making dozens of layoffs in Canada and the United Kingdom, while also looking to sell some of its real estate holdings in Toronto.

WE Charity said its financial position has been greatly affected by the COVID-19 pandemic and “recent events,” prompting a need to shift programming and reduce staff.

In its filing to the Lobbyist Registry, WE Charity disclosed 65 communications with federal officials or ministers in 19 different departments or federal institutions, dating as far back as January 2019. It lists 18 individuals, including Al-Waheidi, as in-house lobbyists for the organization.

The Lobbying Act requires an organization with in-house lobbyists to register within two months of the time when at least one full-time employee spends at least 20 per cent of his or her time in lobbying activities. Opposition parties last month asked lobbying commissioner Nancy Belanger to investigate whether WE Charity violated the act.

Al-Waheidi, who as executive director was the person responsible for registering, told the committee Thursday that had WE Charity considered it necessary to register before now, it would have done so.

The bulk of the group’s communications took place from April to June. The reports accompanying each communication do not go into details, other than to say “employment and training” was discussed.

Ministers and federal bureaucrats have testified that they had some discussions with WE Charity in April about an unsolicited social entrepreneurship proposal the Liberal government ultimately rejected. The May and June communications were presumably about the doomed Canada Student Service Grants program, which was supposed to encourage students to volunteer for community service related to the COVID-19 pandemic.

During her testimony, Al-Waheidi said the controversy has had a “devastating” impact on the charity. The organization announced hours earlier that16 full-time employees at its Toronto headquarters will be laid off. Another 51 employees working on fixed-term contracts with the charity won’t have them renewed when they expire at the end of the month.

WE Charity’s U.K. operations will be centralized in Canada, which means 19 full-time and contract employees in London will be laid off.

“These were not easy decisions to make,” Al-Waheidi said. “We have a very hard-working and dedicated team in North America and the U.K. and over 100 staff leading our international development work overseas. We are grateful and thankful for the contribution they have made around the world.”

The changes come after weeks of intense public scrutiny of WE Charity, its affiliated forprofit organization, ME to WE, as well as the family ties between the WE organization and Trudeau and Morneau. Both the prime minister and finance minister have apologized for failing to recuse themselves when cabinet approved having WE Charity administer the student grant program, as recommended by public servants.

Last month, WE Charity voluntarily suspended all of its Canadian corporate and school board partnerships after many announced they were cutting ties with the organization.

The charity has also cancelled all “WE Day” activities for the foreseeable future and is shifting its WE Schools learning programs to a digital-only format.