August 20, 2010

Take Action on Bill C-470! Contact your MP’s and Senators!

Dear AFP Canadian Member,

We strongly urge you to contact your MP and Senator as soon as possible to discuss the potential impact on your organization of the provision in Bill C-470 that proposes a cap on nonprofit executive compensation.

To assist you, AFP has drafted these talking points.

In addition, you can find more in-depth talking points here.

You can find your MP and their contact information by providing your postal code here.

Background

You received an email from us in May of this year about Bill C-470, introduced by Albina Guarnieri, Liberal MP for Mississauga East-Cooksville, as a Private Member's Bill. The bill would allow the Minister of National Revenue to deregister any charity, private foundation, or public foundation that paid ANY employee a total compensation of more than $250,000 a year. The $250,000 would include salary and taxable and non-taxable benefits (e.g., pension plan contributions, professional association fees, etc.). The Minister would also be authorized to publish the top five salaries paid by any organization.

It is important to note that the Minister would not be obliged to deregister such an organization, but would have the option to do so.

This bill creates redundancy because the Canada Revenue Agency (CRA) currently regulates compensation. The CRA already requires organizations to provide their ten highest compensated, permanent, full-time positions by salary range on the T3010 form. The CRA also retains regulatory authority over executive compensation under the Income Tax Act.

AFP continues to have detailed and very positive dealings with the CRA, which plays an extensive oversight role in charity oversight and regulation.

Status

Bill C-470 received a 2nd reading on April 21, 2010 in the House. 280 MP’s voted in favor of it. Just three opposed it. Numerous MP’s spoke strongly in favour of the bill.

The bill was subsequently referred to the Standing Committee on Finance. The bill likely will receive action in the fall unless there is an election.

AFP in Action!

AFP has coordinated efforts to educate Parliament about Bill C470 with others in the sector, including Imagine Canada. A coalition letter from Imagine Canada, AFP and several others has been crafted with the intent to send it to the four party leaders of Parliament.

We have approached a diverse slate of donors, beneficiaries and board members in the philanthropic world who can speak to this issue on a more holistic level and communicate the impact that this proposal will have on nonprofit organizations’ abilities to fulfill their philanthropic missions by providing services and assistance to our citizens and communities.

But we need your help! Please contact your MP and Senator and explain the potentially devastating impact that a compensation cap could have on the charitable sector. Now is the perfect time to contact them in your province while Parliament is adjourned.

We also urge you to recruit your organization’s own Executive Director, President or CEO to speak to their MP and Senator about this issue.

It is important to remind both the public and Parliament that charities tackle some of the most intractable social, economic, cultural and environmental challenges in Canada and around the world. They need to be free to recruit the most talented and qualified staff that they can to do their work effectively, achieving maximum benefit for our society.

Charities have complex concerns with equally complex management issues and must be able to offer compensation reflecting the realities of local, national and international labour markets.

If you have any questions or need additional information, please contact Jason Lee, AFP Director of Government Relations, at jlee@afpnet.org.