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Goar: Drought in giving scorches non-profit sector

November 13, 2009

Carol Goar

It was a stirring call to arms. "Give the leaders of business and politics hell because that's where we're all going to end up," John Andras, co-founder of the Recession Relief Coalition, told a roomful of community activists. "We must remind them that they have a responsibility not just to the privileged few, but to all of us."

He was warmly applauded.

But his advice flew in the face of every signal coming out of Ottawa, Queen's Park and city hall. All three levels of government have made it clear that deficit control is their priority.

Any hope the federal Conservatives might expand Canada's inequitable employment insurance program died this summer. That leaves 63 per cent of jobless Ontarians and 69 per cent of out-of-work Torontonians without coverage.

Anti-poverty activists have almost stopped lobbying for a social assistance system that lifts Ontario's poorest citizens out of destitution. They know the provincial Liberals have no such ambitions.

And no one expects Toronto, already struggling with a ballooning welfare caseload, to do more.

An appeal to the consciences of business leaders would scarcely be noticed right now. Their eyes are riveted on their balance sheets. Corporate philanthropy has plummeted since the recession took hold.

That leaves Ontario's 45,000 non-profit organizations – particularly those in the social services – in an impossible position.

Demand for everything from food assistance to suicide counselling has surged. Donations, especially from the private sector, have fallen off sharply.

The sector's predicament is laid out in detail in a 32-page report, released this week by the Social Planning Network of Ontario. It is called Hard Hit: Impact of the Economic Downturn on Non-profit Community Social Services.

The network's team of researchers collected information from 413 community service agencies across the province (135 in Toronto).

Here is what it found:

The majority of agencies (57 per cent) experienced increased demand for services between September 2008 and May of this year, when the survey was conducted.

Funding from all sources fell. Corporate and individual donations were down 61 per cent. Grants from the United Way and charitable foundations were down 33 per cent. Federal support was down 21 per cent. Provincial assistance was down 9 per cent. Municipal financing was down 5 per cent.

Non-profit organizations responded by ramping up fundraising (52 per cent), serving more clients with the same staff (also 52 per cent), depleting their contingency reserves (40 per cent), increasing volunteer hours (36 per cent) and asking their workers to take pay cuts (24 per cent).

In spite of these measures, 51 per cent simply couldn't meet the need.

Senior researcher Beth Wilson warned that these responses were not sustainable and posed worrying questions.

"I wonder if there is sufficient infrastructure in place in these organizations to support volunteers and to oversee their work," she said. "Also I wonder whether volunteers are being called upon to take on work they may not be qualified to do or may not be appropriate for them to do."

The Social Planning Network proposed four remedies: the creation of new federal and provincial social infrastructure funds; a broadening of employment insurance coverage; an increase in welfare payments; and a series of top-level meetings between policy-makers and representatives of non-profit agencies to discuss the investments and reforms needed to shore up the social service sector.

The probability of any of these things occurring is minimal.

Economist Armine Yalnizyan of the Canadian Centre for Policy Alternatives urged non-profit leaders to be realistic and resourceful.

"Our attitudes will very much shape what happens next," she said. "With or without money, we have a job to do."

The report is available at www.spno.ca