February 10, 2014 by Guy Crittenden
You’d think that politicizing the agency that collects tax and conducts audits is something a government would go to pains to deny. “We don’t interfere with how CRA does its job,” you might expect the federal politicians to say.
Yet Federal Finance Minister Jim Flaherty is unabashed about what he’s doing. As the news report reprinted below states, he’s proud of it, and has committed $8 million to “closely monitoring” seven environmental groups that are critical of government policy around the oil sands, whom the CRA is auditing.
Below I’ve pasted a link to an excellent and fair short video from the BBC about the oil sands (only seven minutes long) that neatly sums up the issues and the amount of oil that exists to be mined. I also reproduce the link and the text to a CBC report of the federal audits.
But first a couple of quick comments.
First, it’s clear that our federal government, led by Prime Minister Stephen Harper (whose political base is strongest in conservative Alberta), has been absolutely corrupted by the oil & gas lobby. Our federal government is simply a shill for the oil sands projects and related corporate interests, associating unfettered support with national patriotism, as though the toxic tailing ponds are as Canadian as maple syrup, moose and Mounties.
Whatever you think of the oil sands, our elected federal officials should not behave like board members of Syncrude (positions with which they’ll inevitably be rewarded when they leave political life). It’s one thing to be “supportive” of this kind of industry; it’s quite another to target credible environmental groups, like President Nixon setting the CIA upon his imagined political enemies.
It’s paranoid and downright disgusting.
Second, the government and the oil companies developing the oil sands have done a terrible job selling the Canadian public (let alone the foreign ones other than China and the USA) on the benefit of these undertakings. I have no doubt that there are “jobs” for workers in the oil sands, but outside of that the fundamental benefit of all this is not apparent. There’s considerable evidence that the federal and provincial government have been looking the other way at a lot of environmental violations, failing to prosecute clear instances of pollution.
It’s difficult not to conclude from imagery and reports of the oil sands that a large area in Alberta is being turned into a “sacrifice zone,” the plan being to get the oil out as expeditiously as possible, with the understanding that the health of local populations (aboriginal and non-aboriginal) will be compromised, and so be it. And let’s not kid ourselves: that landscape will be enlarged into a bigger and bigger moonscape of excavated bitumen lands and toxic lakes. It’s not as though that will happen by accident: that is actually the plan.
Third, one of the things that bothers me most about the oil sands is that it looks like these enormous oil reserves are being sold for short-term financial gain. The planet’s oil & gas resources are being drawn down quickly. Just as the Great Lakes are a huge resource of fresh water that should be preserved for our use and enjoyment, I think the Alberta oil sands should be kept for the benefit of Canadians. If they’re developed at all, it should be for domestic use, to free Canadians from having to import oil from elsewhere.
Apart from the very real risk of pipeline spills (given the lousy record of Enbridge et al recently — I offer you the Kalamazoo spill as just one example: http://en.wikipedia.org/wiki/Kalamazoo_River_oil_spill) I’m offended by the concept of pumping the oil thousands of miles to refineries in the United States, for use by Americans or shipment overseas. I’m even more bothered by the so-called Northern Gateway proposal, which would pump the oil through rugged mountains and onto ships that would take it to China.
Why not keep it and use it in Canada? Keep the refining infrastructure and jobs in Canada.
And now I’ll say something really controversial, and that is that I support James Lovelock (perhaps the world’s most famous environmentalist) in his idea, which is to build nuclear power plants at the oil sands, and use the energy from them to melt the bitumen and recover the oil. As much as I dislike some aspects of nuclear power, it would end the necessity of burning outrageous amounts of natural gas to melt the bitumen and, unlike the Fukushima reactors, the plants would be located on stable land away from dense populations. (I’d make the oil companies pay for the plants, by the way.)
I’d favor this plan only as a temporary option as we transition to a different energy economy based on renewables, different automobile designs and vastly more energy efficient home and building designs.
I could go on. Some of those ideas are worth pursuing in future blogs. In the meantime, here’s the information I promised.
Oh, and one more thing. I choose to use the term “oil sands” even though that too offends me. I dislike being co-opted by industry into their PR exercise renaming what everyone used to call the “tar sands” — and I think this rebranding exercise was actually a mistake. (It reminds me of how municipal waterworks engineers rebranded sewage sludge as “municipal biosolids” and their application on fields as “beneficial use.”) But I’ll use the term “oil sands” just so the oil industry PR flacks can’t easily brand me as an enemy.
And, hey, I’d rather not be audited thank you very much. I have two words to say to Jim Flaherty and Stephen Harper, but this is a public article and I’m a polite person, so I’ll shut up now.
Here’s the link to the short BBC video:
And here’s the link (and text) for the CBC report on the audits:
Charities fear they may lose charitable status
By Evan Solomon, Kristen Everson, CBC News Posted: Feb 06, 2014 8:55 PM ET Last Updated: Feb 06, 2014 11:14 PM ET
The Canada Revenue Agency is currently conducting extensive audits on some of Canada’s most prominent environmental groups to determine if they comply with guidelines that restrict political advocacy, CBC News has learned.
If the CRA rules that the groups exceeded those limits, their charitable status could be revoked, which would effectively shut them down.
Many of the groups are among the Conservative government’s fiercest critics. Finance Minister Jim Flaherty signalled clearly in his budget of 2012 that political activity of these groups would be closely monitored and he allocated $8 million to the effort. The environmental organizations believe they have been targeted with the goal of silencing their criticism.
“We’re concerned about what appears to be an increase in audits around political activity and in particular around environmental organizations,” said Marcel Lauzière, president of Imagine Canada, an umbrella organization for charities.
“There’s a big chill out there with what charities can and cannot do.”
The list of groups CBC has now confirmed are undergoing audits reads like a who’s who in the environmental charity world. They include:
“This is a war against the sector,” says John Bennett, of Sierra Club Canada. His group is not yet being audited, but he said he is prepared.
“In the 40-year history of the Sierra Club Canada Foundation, it’s been audited twice in 40 years,” so there are more audits than usual, Bennett said.
CBC has confirmed that at least one group, Environmental Defence, has received its report back from the CRA and they are appealing it. Sources said their report threatened to revoke their charitable status. Another group, West Coast Environmental Law, had auditors fly in from Ottawa to enhance the work of the local CRA team. One source said the Ottawa CRA people called themselves “The A team.”
Most groups on this list would not talk on the record, but sources say executive directors of these groups are meeting regularly by phone to discuss a united response to the government.
By law, charities are allowed to use a maximum of 10 per cent of their resources for political activity or advocacy, but the guidelines are clear that it cannot be partisan activity. That has been interpreted for years to mean that a group can oppose a government policy but cannot back a specific candidate in an election.
During a pre-budget consultation in December, Flaherty said he is considering making even more changes to rules for charities that have a political aspect.
‘The problem with this is that they gave the power to CRA to walk in and shut you down.’
– John Bennett, Sierra Club Canada
“We’re reviewing that,” Flaherty said. “We spent some time on it last year and we’re looking at it again now as I prepare the budget.”
He went on to warn charities: “If I were an environmental charity using charitable money, tax-receipted money for political purposes, I would be cautious.”
Bennett said the rules seem to be constantly changing.
“We don’t know what rules we’re playing by. The problem with this is that they gave the power to CRA to walk in and shut you down. And then if you want to complain, you can go to court afterwards.”
The government insists it does not target certain charities, nor does it tell CRA to do so. Auditors alone determine whether they investigate a charity.
“I assume they receive all sorts of information from all sorts of Canadians, in terms of who they should or should not audit. Ultimately it is up to them as an independent agency who they audit or not,” Alberta Conservative MP James Rajotte said.
CBC News contacted the CRA several times to ask how auditing targets are chosen. Spokespeople suggested responses could be found on their website. There, it states some of the reasons a charity could be selected for an audit, including random selection, to review specific legal obligations under the law and to follow-up on possible non-compliance or complaints.
According to lawyer Mark Blumberg, who specializes in charity law, the CRA often audits charitable organizations based on complaints.
“If there are a number of complaints about a charity and its political activities, that could trigger an audit by CRA,” he said. That assessment is echoed by a number of groups currently undergoing audits.
“I believe our audit was complaint driven,” said Ross McMillan, the president and CEO of Tides Canada.
“I am confident of a positive outcome as we take seriously our responsibility to act in compliance with the Income Tax Act and Canada Revenue Agency guidelines,” he said.
Pro-oilsands group has filed complaints
McMillan goes on to cite complaints from Ethical Oil, a group that has formally submitted complaints to the CRA about Tides Canada, the David Suzuki Foundation and Environmental Defence.
The complaints are all filed through legal counsel and are part of a campaign Ethical Oil has started to strip these environmental groups of their charitable status.
Ethical Oil is a registered non-profit non-governmental organization that describes itself as an “online community” to empower people to become grassroots activists in defence of the oilsands development.
The group was founded by Alykhan Velshi, who is currently the director of issues management in the Prime Minister’s Office. Environmental groups say Ethical Oil is funded by the oil and gas industry to try to undermine their work
CBC News has repeatedly asked Ethical Oil to reveal who their funders are but no specific list has been made public.
Environmental groups are not the only ones who have been audited. Social justice groups like Amnesty International Canada are also currently undergoing an audit about their political activities. CBC News contacted them but they declined to comment.
All the groups say they will be watching Tuesday’s budget for new rules that may affect their charitable status.
“We have an important role to play in our society and we want to play that role,” said Bennett. “But we need a governing system that actually welcomes public dialogue instead of discouraging it.”