In recent months, Cooperation Canada and its members have actively engaged in conversations with Global Affairs Canada and other political actors about relationships between Canada and Africa, seeking to contribute to the redefinition of the rules of our engagement with and on the African continent.
Learn more about Cooperation Canada and its members’ views in these recommendations from the Canadian civil society.
The 60th anniversary edition of the Development Co-operation Report takes stock of the multiple global crises that put current models of development co-operation to a radical test. The report critiques the failure to address the root causes of underdevelopment, calling out colonial legacies and racism in the sector. The report, particularly in its 14th Chapter co-authored by AidWatch, emphasizes how the current system and practices disadvantage Global South civil society organisations and proposes priority actions: Deliver existing commitments; Support locally led development; Modernize business models, and Balancing power relations in decision making.
Link to the full report: https://www.oecd-ilibrary.org/sites/f6edc3c2-en/index.html?itemId=/content/publication/f6edc3c2-en
Canada’s charitable organizations are regulated by the Canada Revenue Agency (CRA) guidance CG-002, dubbed ‘direction and control’ emanating from the Income Tax Act (ITA). Following amendments to those provisions introduced in the 2022 Federal Budget, the CRA revised the guidance outlining how registered charities can make “qualifying disbursements” to non-qualified donees (NQDs) and invited stakeholders to comment on the draft guidance between November 2022 and January 2023. In its submission to the CRA, Cooperation Canada appreciates the efforts made to address sector’s concerns about the Direction & Control approach, yet stresses that the guidance over emphasizes risk and imposes onerous requirements for charities.
Cooperation Canada highlighted sections of the draft guidance that require significant revision, such as those on risk assessment, accountability tools, and pooled funding. The risk assessment framework is particularly problematic for organizations working internationally. The guidance does not specify the risk that the CRA tries to minimize but uses language that closely resembles that used in risk mitigation measures for terrorism financing. By requiring charities to assess the level of risk at the outset of the grant, the guidance may discourage charities from partnering with young or small organizations.
Among the sections that need further clarification, Cooperation Canada recommends that CRA examines the clauses on directed giving and security concerns. Finally, the submission notes that the guidance is missing some important definitions. Several of these points have also been raised by others in the charitable sector.
For other opinions on the subject:
The charitable sector has long been demanding more fairness, equity, and equality of opportunity. The draft guidance unfortunately contains potential pitfalls, which may have the unintended effect of perpetuating direction and control practices, despite the sector’s quasi unanimous distaste for that paternalistic concept. A true alternative should entrench a culture of ethical relationships and respectful collaboration in the regime governing the activities of charities alongside partner organizations in Canada and abroad.
The world is facing multiple crises that compound and exacerbate each other. Canada is not immune from these crises. But Canada can be part of the solution. Because of this challenging global context, Canada must continue to invest in the type of world we want.
During International Development Week 2023, Cooperation Canada and its members spent a day speaking to government officials and parliamentarians about the strategic importance of international assistance and the difference it is making in the lives of millions of people worldwide. More than 40 people from Cooperation Canada’s member organizations were involved in the meetings with representatives of key departments and Members of Parliament from the Bloc Québécois, Conservative Party, Green Party, New Democratic Party and Liberal Party. Their discussion arguments are summarized in this document: “In the Midst of Multiple Crises, Canadian Global Leadership is Needed”.
In December 2022, Cooperation Canada responded to the Department of Finance consultation on Canada’s Official Development Assistance (ODA). This yearly consultation gives stakeholders an opportunity to comment on the Department’s payments to the World Bank Group’s International Development Association, the Multilateral Debt Relief Initiative, the International Finance Corporation, and the Asian Infrastructure Investment Bank, as well as the Department’s bilateral loan to Ukraine and loans through the International Monetary Fund Administered Account for Ukraine. In addition to providing input on two of the three guiding questions, Cooperation Canada’s submission encourages reflection on the effectiveness of these international assistance contributions.
About meeting ODA criteria
The first guiding question probes whether the Department’s ODA payments to the above multilateral institutions satisfy the criteria concerning poverty reduction, perspectives of the poor, and international human rights, as set out in the Official Development Assistance Accountability Act.
Contributing to poverty reduction is one of the three criteria characterizing ODA in Canada, the other two being to take into account the perspectives of the poor and to be consistent with international human rights standards. Cooperation Canada acknowledges the role of multilateral institutions like the World Bank’s (WB), International Development Association (IDA), and the Multilateral Debt Relief Initiative (MDRI) in global poverty alleviation, yet has concerns about the alignment of their operations with the last two criteria.
Canadian CSOs have often expressed concern about the prioritization of financial returns over positive development impacts, which is problematic as this relegates the perspective of the poor as a marginal success factor. In contrast, country-led approaches are often better designed to center the needs and priorities of the poor and marginalized communities. Further, considering the perspective of the poor requires increased attention to gender equality, as women and girls are often among the most vulnerable groups that are the first hit by austerity measures recommended by the International Monetary Fund.
About the Report to Parliament on the Government of Canada’s International Assistance
The second guiding question in the consultation asks whether the Report to Parliament on the Government of Canada’s International Assistance helps to improve transparency on international assistance.
Cooperation Canada would welcome reporting on balances in budget allocations, new budgetary additions, as well over or underspending levels. It would also be useful to see some indication on the future path of international assistance (both ODA and non ODA). Clear reporting on each ODA criterion would also increase transparency.
General considerations
Cooperation Canada encourages the Department to assess what type of Canadian presence across multilaterals represents the best value for money in terms of achieving development objectives and whether Canada’s current presence is rightsized. Another essential question is whether these multilateral institutions are fit to address the debt emergency. The IMF itself recently warned that failure to support lower-income countries in the current inflationary context would have severe ripple effects as countries are being forced to borrow more to keep their citizens from going hungry. This runs at cross-purposes with the commitment, under the Multilateral Debt Relief Initiative (MDRI), to cancel 100% of eligible debts owed by heavily indebted poor countries. This also gives motive to question the governance models in multilateral development institutions that seem to generate and perpetuate maldevelopment.
Policy Lead, Cooperation Canada
