Normal everyday life and significant portions of the economy have largely come to a halt due to COVID-19. For many, the services that the charitable and nonprofit sector provides have never been more needed.
There has been a collective realization that in the absence of everything else, charities and nonprofits ensure that all Canadians have their basic needs met. Food banks, shelters, elderly care, support for those with disabilities, distress centres and line operations, assistance to those with severe illnesses: these are all essential services that have to carry on regardless of cost.
Increased demand, loss of revenue
Much of the sector’s focus is on the most vulnerable. While the number of people that fall into this category continues to increase, the capacity to meet this expanding need is in free-fall. Many charities and nonprofits have been forced to drastically scale back their fundraising and income-generating programs. Just like their business counterparts, these sector organizations are dealing with substantial revenue losses. However, unlike many businesses, sector organizations are simultaneously facing increased demand.
“The last few weeks have seen a dramatic reduction in services for children and families in vulnerable situations. Many organizations who were offering family enhancement and prevention programming have either shut down programs or moved services online. We are very concerned for the safety and well-being of children whose families were already coping with multiple difficulties (e.g. addiction, intergenerational trauma, family violence, food insecurity) in a context of poverty.”
-Rachel Gouin, Executive Director - Child Welfare League
Managing through, and building resilience
"The biggest challenge is we don't know how long this will go on - when we will be in a position to earn revenue and fundraise again. We have to ask what a new normal state of operations will be going into the future. What is the size of staff and programming that we will be able to sustain given a decrease in audiences and fundraising?"
- Claudette Leclerc, ED - Manitoba Museum
Once this crisis is over, Canadians will be desperate to experience live performance again, but what happens if venues, theatre companies, orchestras, museums and galleries, dance companies, and others are forced to close in the meantime? At any rate, arts and culture groups, as an example of the sheer resilience of our sector, continue to find new ways to step up. Musicians putting on Facebook Live gigs, museums offering virtual tours, authors delivering virtual readings, dance lessons being given on-line...not only does the show go on, it gives much-needed comfort and distraction to everybody shut in their homes. The challenge will be finding ways to generate revenue from these new initiatives to keep the sector afloat.
We are in the midst of this crisis, but there is still a need to look ahead to the clean-up effort and beyond. Many Canadians will need help rebounding once communities are freed from the immediate wreckage of COVID-19. Charities and nonprofits will be there for them regardless of their staffing or lease situations. The character and makeup of our sector may be different: there is a tangible risk that we’ll lose some of the gains we have made in recent years in terms of our diversity and ability to innovate. While charities and nonprofits of all sizes are hurting, smaller, community-based organizations that are led by or primarily serve equity-seeking populations may be the least able to weather the storm without immediate assistance.
A partner in government?
Right now, governments at all levels are scrambling to keep up. The federal government has already announced wide-ranging supports for individuals and employers, but has acknowledged that these will not be enough. Our own financial modelling indicates that if social distancing remains in effect for three months, and the country finds itself in a recession for 2020, the best-case scenario is that registered charities will see a decline in revenue of $9,5 billion. If social distancing continues for six months, this figure rises to $15,7 billion. It is important to note that nonprofit organizations are not included in this modelling as it draws from T3010 data, so the scale of overall damage to our sector is undoubtedly extremely understated in these numbers.
Stabilization fund: We’ve recommended an $8 billion stabilization fund -- what we think is the minimum needed to ensure the essential community services provided by our sector. Assistance of this magnitude would have seemed unbelievable just weeks ago - but today we wonder if even this much will be enough to get organizations through to 2021.
Grants & contributions: We are hearing from our networks that organizations are having to adjust the services they provide to meet newly created gaps and community need. The government can support this responsiveness and community resilience by easing reporting requirements with grants and contributions programs. Automatic granting renewals and more flexibility in how organizations use funds would help with cash flow issues that organizations are and will be experiencing. Some federal departments are moving in the right direction, and it’s time for a more coordinated effort.
Gifting to non-qualified donees: Similar to this point, there are areas of the country currently underserved by charities that now require support. This is why we’re also asking for a temporary lift on restrictions on granting to non-qualified donees. If charities can identify partners meeting real needs in underserved communities, they should be able to provide gifts and grants that further their purpose regardless of the usual legal niceties.
A home in government: Finally, it has never been more clear that the sector needs a home in government. Charities and nonprofits are integral to the mandates of most government departments, but there is no federal body we can consistently work with to determine how organizations can be supported in our service to the country. For example, the UK’s Charities Commission is a government body mandated to work with organizations there to develop supportive public policy. In this hour of need, a number of civil servants have -- heroically -- risen to the occasion to make up for this lack of general partnership between the country’s government and its civil society. This is why we recommend a government-sector roundtable so that key Ministers, officials, and sector leaders can better coordinate policy as the sector continues to respond to the COVID-19 crisis.
How you can get involved
- Join the sector’s call for the policy measures described above, and send a letter to your MP. Through our letter campaign, sector organizations have sent over 1,000 letters to MPs and key Ministers asking for sector support.
- Your organization is also encouraged to endorse our letter to the Prime Minister, in which we advocate for the policy measures described above. Email us at firstname.lastname@example.org to to add your name and organization to the list.
- In advocating for causes such as this one, we know that politicians value stories. How is this crisis affecting your organization? Share your stories with us so that we make the government understand what you’re going through. Email us at email@example.com to share a quote with us.
Your hard work and dedication to our communities is appreciated.
As the situation progresses, we will be sharing sector relevant policy and advocacy updates via our Early Alert newsletter, our social media channels (Twitter, Facebook, Linkedin), and on our regularly updated COVID-19 and the Canadian nonprofit sector webpage.