Let's Get Small: Federal Budget 2012

Mar. 30, 2012

A response from Community Foundations of Canada.

The big story of the 2012 Federal Budget is the 7% reduction in spending (more than $5B) out of a pool of approximately $75 B that was under review. This will have a spill over effect on community service delivery, and in turn, community foundations may see a shift in demand. It will also have a significant effect on the public sector labour force with reductions estimated at between 20,000 to 25,000 public sector employees.

The missing sector

The budget document itself isn't so small - at about 500 pages long - and there are few places that fail to receive attention - innovation, universities, small business, energy - which makes the general absence of the community sector or community itself seem stark in comparison.

The Stretch Tax Credit didn't make the cut this time. And on the rare instances where charitable organizations are referenced, along with the Standing Committee on Charitable Tax Incentives, the policy prescriptions are restrictive - regulatory provisions around political activity, foreign funding sources and heightened transparency and accountability measures. This runs against the grain of reducing red tape and streamlining regulations in other areas of national interest.

Pennies for your problems?

The only other mention of the sector was related to Ottawa scrapping the penny. The feds are encouraging charities to 'collect the coins from Canadians' and redeem them as a fundraising venture. Community Foundations of Canada, of which London Community Foundation is a member, will be participating in a call organized by Imagine Canada later this week.

Glimmers of possibility

In digging deeper, the budget offers some momentary glimpses into possible opportunities - and challenges:

  • The economic message - trade, foreign affairs, innovation, jobs, markets - has a strong focus on Asian Pacific development, a place where more and more of our diaspora linkages in philanthropy are growing. How do we build on this trend across the Pacific while maintaining our Trans-Atlantic relationships and North-South partnerships? 
  • Study will continue on social finance and CFC is well-positioned in this area, having recently completed a paper for internal government use and discussing potential Government and Community Partnerships, such as test projects under review in Hamilton and Winnipeg. 
  • The counter-balance of extending the retirement age (OAS) to 67 is met by a focus on youth employment ($50 M allocated.) Canada has a challenging labour market demographic mix to sort out and the challenge for young people is significant. 
  • ParticipACTION is renewed and so is the Canada Council for the Arts and support for artistic exhibits in Canada. Not a lot of new news for the expressive parts of the non profit communities in sport and culture. 
  • A new path is being set for immigration policy, with a focus on economic immigration, targeting skilled newcomers and gaps in the workforce. 
  • Those leaders that shaped the Registered Disability Savings Program will see that the review process (after three years) has produced recommendations encouraging heightened flexibility. 
  • Response to the measures to support aboriginal communities is mixed, with some criticizing the lack of real action on affordable housing. 
 Quick Links
  • Federal Budget 2012, more>
  • Imagine Canada news, more>
  • Canadian Charity Law, more>