Why are unions singled out to be transparent?

There are noteworthy arguments both for and against the bill passed by the House of Commons that requires disclosure of detailed financial information by labour unions in Canada.

It bears noting off the top that while it had the full support of the government leadership, Bill C-377 was presented as a private member’s bill by a Conservative backbencher, which might suggest that the government was somewhat squeamish about being seen as pursuing a vendetta against unions. It is a tactic the government used to legislate against the long-gun registry while still in a minority position.

The bill’s sponsor, British Columbia MP Russ Hiebert, along with supporters of the measure, maintain that it will make unions more accountable and more responsive — to both their members as well as the general public at whose expense unions benefit from tax writeoffs, tax exemptions and deductibility of union dues. Unions further benefit from the Rand formula requirement that obliges all non-management employees in a unionized workplace, whether union members or not, to pay union dues since all benefit from contracts negotiated by the unions.

The legislation requires unions to make a long list of financial disclosures to Revenue Canada for posting online, including a balance sheet of assets and liabilities, a statement of income and expenditures, a detailed list of transactions over $5,000, salaries of union officials in excess of $100,000, and a record of time dedicated to political and lobbying activities.

Proponents have a point when they note that similar disclosure is required of other institutions that receive a substantial public benefit, like government itself, crown corporations, charities and aboriginal reserves. Such requirements, the Conservatives argue, bring Canada into line with similar requirements in other countries, including Australia, France, Germany, the U.S. and Britain.

They also suggest that unions have invited forced transparency because many donate money to causes and entities that a majority of their members or the public more broadly might not support. A prime example: the tens of thousands of their members’ dollars that Quebec unions spent in support of the often violent student protest last spring, while two-thirds of Quebecers stood with the government in the conflict. Another was the thousands that unions spent on advertising at a recent NDP convention, and which was subsequently ruled illicit under political financing laws.

Unions and their backers hold that the legislation amounts to ideologically driven harassment of the union movement, and possibly a prelude to revoking the Rand provision, as nearly half of U.S. states have done so far under the banner of “right to work” legislation. They further contend that it would impose an onerous paperwork burden, not just on unions that have to do the reporting the bill demands, but on Revenue Canada, which will have to scrutinize and enforce the detailed record keeping involved.

Lending credence to arguments that unions are being singled out is the fact that professional member-based organizations that receive preferential tax treatment, like law societies to which practising lawyers must belong and whose dues are tax deductible, are not subject to similar disclosure rules. Proposed opposition amendments to extend the rules to them were defeated by the Conservative Commons majority.

And, some wonder, what about private companies? Many receive substantial direct and indirect benefits from the public purse, through tax breaks and such stimulus programs as the Youth Employment Program, the Scientific Research and Experimental Development Tax Incentive and the Canadian Innovation Commercialization Program. So why not extend this transparency model to them?

Of course, it might also be suggested that the government would have helped its case in this matter by practising transparency as enthusiastically as it preaches it to others. Hammers and tongs were needed to pry the full projected cost of the F-35 fighter jet purchase from the government, and this administration has persistently hampered the parliamentary budget officer in fully doing his job by withholding from him information to which he would appear to be entitled.

It is surely best in this and other matters of propriety for governments to lead by example.