An effective carbon price won’t harm Canada’s competitiveness

Let’s start with a prediction: Any move Ottawa makes toward a price on carbon pollution will be greeted with a chorus of concerns about competitiveness.

Expect to hear that companies will be at risk. That some will pull up stakes and move to jurisdictions where they can pollute more. And that we’ll all be poorer as a result.

We’re making a very safe bet. Those concerns surface every time a government decides to price carbon, in Canada or elsewhere. Donald Trump’s election as President of the United States has only made the chorus louder. But here’s what often gets lost in the noise: there are ways to design carbon-pricing systems to address those competitiveness concerns.

And that is exactly what we expect Canadian governments to do. Here’s how.

A price on carbon could change a company’s competitive position by making the fossil fuels it uses (or produces) more expensive – or by making the clean technology a company produces more valuable.

For most companies, the price of fossil fuels is a minor variable compared with other factors that influence competitiveness, such as prices throughout the supply chain, exchange rates and demand for their products. In such cases, the price on carbon will work exactly as intended: it will encourage them to waste less energy and to invest in cleaner technologies.

But for a small fraction of companies, the risks are higher. Emissions-intensive companies generate a lot of carbon pollution, so they feel a carbon price more strongly. Trade-exposed companies compete internationally, potentially against firms producing the same commodities in places with less strict environmental regulations.

For operations that are both emissions-intensive and trade-exposed, a price on carbon could lead to a result no one wants: companies leaving Canada to operate in places where they can emit carbon pollution without constraint. That’s obviously bad news economically, but it would also be environmentally counterproductive – a carbon price should encourage companies to clean up their operations, not relocate them.

No government puts a meaningful price on carbon without considering this problem, known as leakage. So as Ottawa follows through on its commitment to price carbon pollution across Canada in 2018, there are plenty of real-world examples to draw from that take competitiveness into account.

Getting the design right starts with correctly identifying the size of the problem.

Very few industries objectively qualify as both emission-intensive and trade-exposed. A 2015 assessment from Canada’s Ecofiscal Commission concluded that just 5 per cent of Canada’s economy meets that test.

That means 95 per cent of our economy has little to fear – and, potentially, much to gain – from pricing carbon pollution. And for sectors with more on the line, there are many ways governments can help.

Ontario and Quebec already price carbon through a system known as cap-and-trade, which creates a market for pollution permits. Both jurisdictions give free permits to many sectors, attempting to maintain the financial reward for cutting carbon pollution while reducing potential risks to competitiveness. In Alberta, which applies a levy on carbon emissions, many companies will receive rebates in proportion to their output.

It may sound like it defeats the purpose to price carbon pollution and then return some of the money to companies. But think of it as being similar to taxes on cigarettes: making them more expensive helps cut down on sales, even if the money raised doesn’t go into anti-smoking programs.

As a targeted solution where it’s really needed, rebates such as these can make sense. Used well, they can help guard against companies relocating. More importantly, they help give governments the confidence to put a price on carbon pollution in the first place.

In fact, experience suggests that – far from ignoring the prospect of competitiveness risks – governments usually worry about them too much, and end up giving out rebates too freely as a result. To avoid that, rebates should be transparent and governments should commit to reviewing, early and often, how they treat vulnerable sectors.

Merran Smith and Clare Demerse are the executive director and federal-policy adviser, respectively, at Clean Energy Canada, a think tank housed at Simon Fraser University’s Centre for Dialogue.

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Canadian passport will have new marker for transgender travellers, justice minister says

Transgender travellers will soon have another option to tick off on their passport other than “male” or “female.”

Justice Minister Jody Wilson-Raybould said the government is working to update its gender identity policies right across federal departments, and they will include a revamped travel document.

“The prime minister is very mindful of perhaps a third box or an ability to mark something other than male or female. This work is being undertaken at Passport Canada,” she said. “Individual ministers and (people) within their departments are recognizing that this bill has been introduced, that there is work that needs to continue to be taken.”

Wilson-Raybould was testifying before the Senate legal and constitutional affairs committee, which is studying government legislation to protect the human rights and security of Canadians based on gender identity and gender expression.

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Public input vs. the secrecy of free trade talks

Members of the Council of Canadians with a banner outside the Prime Minister’s office on April 26th, 2017
Photo Credit: Council of Canadians

The citizens advocacy group the Council of Canadians is decrying the ongoing secrecy of new international free trade talks.

Highly secret talks were held in the past two weeks with China, and with TPP nations.

In addition, the Council’s concerns about exaggerated claims of the economic benefits of international free trade seem to have been confirmed to some extent by the Parliament’s own budget officer in a new analysis of the Comprehensive Economic and Trade Agreement with the E.U. (CETA)

Sujata Dey is Trade Campaigner with the Council of Canadians


 Sujata Dey speaking at a Senate trade committee this week asking Senators not to rush approval of the CETA deal. *Many Canadians and Europeans are concerned that CETA is based on a blueprint for trade which gives incredible rights to corporations: protections on investments, patents, public services, regulatory harmonization, with nothing for the environment and for other stakeholders.*
Sujata Dey speaking at a Senate trade committee this week asking Senators not to rush approval of the CETA deal. *Many Canadians and Europeans are concerned that CETA is based on a blueprint for trade which gives incredible rights to corporations: protections on investments, patents, public services, regulatory harmonization, with nothing for the environment and for other stakeholders.* © CPAC-via Council of Canadians

This week, two days of secretive talks were held among government deputy ministers in conjunction with the Trans-Pacific Partnership (TPP) free trade deal. This comes as a lead-up to  the Asia-Pacific Economic Cooperation (APEC) trade ministers’ summit on May 20-21 and potentially to a completed deal at the APEC leaders summit on November 10-11.Although held in Canada, neither the media, nor even many elected officials knew of the talks, or where they were held.

Sujata Dey says the Council only learned of the talks through vague leaks in foreign media.

A very similar highly secretive meeting was held recently with Chinese officials regarding trade talks.

The Council of Canadians points out that the House of Commons and Senate committees have all produced reports saying that trade agreements should not be negotiated in back rooms with only business interests at the table.Dey says the Trudeau Liberal government publicly deplored the previous government’s secrecy in such negotiations, but she says the Liberals have been doing exactly the same thing.

Anti-free trade protests in Brussels Belgium in September 2016 outside the European Commission with CETA as a *trojan horse*. © Reuters

In a statement Council of Canadians’ Political Director Brent Patterson says, “The government is again doing what it does best: excluding the rest of us from deals which have repercussions for us, just like it did with the Trans-Pacific Partnership and the Canada-European Union Comprehensive Economic and Trade Agreement. This creates a situation where public services, the environment, and our jobs are on the menu, instead of at the table”.

A Nanos Research survey in April found that 88 per cent of Canadians would be uncomfortable or somewhat uncomfortable with a deal that would allow Chinese state-owned corporations to buy high-tech firms and that would allow these corporations to invest in the tar sands. In addition, 66 per cent of respondents said that Canada should link human rights to a free trade deal.  These findings run counter to what the Chinese government has demanded (ability to purchase high-tech companies, the lifting of investment barriers in the tar sands, that democracy or human rights have no place in trade talks).

May 2016: Members of the Unifor trade union and the Council of Canadians join to protest TPP outside a luxury Toronto hotel where the House of Commons standing committee on international trade was holding a 1-day hearing into the 12-country ’free trade’ deal. The 170,000 were the number of names on an anti-TPP petition to that date
May 2016: Members of the Unifor trade union and the Council of Canadians join to protest TPP outside a luxury Toronto hotel where the House of Commons standing committee on international trade was holding a 1-day hearing into the 12-country ’free trade’ deal. The 170,000 were the number of names on an anti-TPP petition to that date © Council of Canadians- Unifor

The Council’s website also quotes Charles Burton, a former counsellor at the Canadian embassy in Beijing in a comment to the Globe and Mail newspaper. In it he says, “Opinion polls indicate most Canadians do not want further political-economic integration with China, but elements of Canada’s business elite, with lucrative connections to Chinese business networks, are lobbying the Prime Minister’s Office hard to push on”.

The Council and other advocacy groups in Canada and abroad have said that claims of how economies will benefit have also been exaggerated.

Recently Canada’s Parliamentary Budget Officer released figures showing that the recent CETA deal with the European Union  was not nearly as beneficial for Canada as claimed by Canada’s government.

Canadian Prime Minister Justin Trudeau is greeted by Chinese President Xi Jinping at the G20 Leaders Summit in Hangzhou, China on Sept. 4, 2016. Polls show the majority of Canadians are wary of the implications of a free trade deal with China
Canadian Prime Minister Justin Trudeau is greeted by Chinese President Xi Jinping at the G20 Leaders Summit in Hangzhou, China on Sept. 4, 2016. Polls show the majority of Canadians are wary of the implications of a free trade deal with China © Adrian Wyld/Canadian Press

Both the past Harper Conservative government (which began the deal) and the current Trudeau Liberal government which signed it had claimed substantial financial gains for Canadians and that it would create some 80,000 new jobs.

Maude Barlow, National Chairperson of the Council of Canadians says,“In exchange for a pitiful amount of economic growth, we will increase lawsuits from European companies, destroy our family farms, decimate our fisheries, and raise our drug prices. It just doesn’t make sense.”

The report now says that economic gains will only be “modest”, and  that gains will through increased efficiencies from consolidation and expansion at a sectoral level.  Consolidation might be interpreted as leading to job losses.

It also states, “The Dispute Settlement mechanism in CETA has also left some ambiguities concerning its implementation and the potential for Foreign Direct Investment”.

*Wheel of trade Misfortune* seen at an anti- TPP protest in Toronto June 2016.
*Wheel of trade Misfortune* seen at an anti- TPP protest in Toronto June 2016. © Council of Canadians

Sujata Dey, says previous government claims of the benefits of the deal were drawn from flawed data and misleading assumptions. Though this PBO report is far less enthusiastic than government estimates, Dey says it too is using some inaccurate data and figures.

The PBO’s study uses an economic model that assumes full employment – that everyone has a job. It also measures gains from exports without looking at offsetting losses from imports,” said Dey. “Nor does the model consider effects on public services, drug prices and workers. Yet despite these flaws, the study still only predicts very small gains in GDP.”

Dey insists that the Council is not against trade, quite the contrary, but the Council wants such trade negotiations to open for scrutiny and public input, before they are presented as “done deals” with no modifications possible.

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B.C. Election: Christy Clark accepts her haters

BC Liberal Leader Christy Clark says she is heading into the 2017 provincial election “a little more brave, and little bit more bold” than she was four years ago when she sought her first term as premier.

In a one-on-one interview with Global BC Legislative Bureau Chief Keith Baldrey, Clark recapped which policies she would prioritize if she were to win the vote next week, and spoke about some of the influences growing up — think Mary Tyler Moore — that led her to the legislature.

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To many, Clark isn’t seen as the darling of B.C. politics — her approval rating sank to only 31 per cent in March from a post-2013-election high of 45 per cent. An Angus Reid Institute poll also found she was the most disliked candidate running in this spring’s election.

Christy Clark is most disliked party leader running in B.C. election: poll

She admits she’s a polarizing figure, but Clark maintains she is comfortable running government without everyone’s support.

“Governing means you have to make some hard decisions,” Clark said. “Sometimes that means people don’t like what I’m doing. Sometimes that means people don’t like me. I understand that. I think, at the end of the day, the results for people’s lives, there have been good results.”

She also admits she has a habit for speaking her mind, even when it could get her in trouble.

“I think maybe sometimes I just say what I’m thinking. Sometimes not everybody likes to hear when politicians say what they’re thinking. Maybe that’s what bugs people about me, and I accept that. I don’t think people always like politicians and I understand why.”

Clark’s past policies on education, housing and big energy projects like Site-C and LNG, are hot issues among voters. Her critics say she neglected B.C. public schools and teachers, let Metro Vancouver housing prices rise to unprecedented levels without intervention and pushed through energy projects the province didn’t want or need.

She stands by her record, but says there is still plenty more her party could do to make B.C. better.

“LNG is something that has taken longer to get started. You look at Alberta oil and gas, the market has been pretty bad. It will improve, so we will get a chance to do that. Rather than wave the white flag and give up on eliminating our debt, getting LNG going, giving up on Site-C –let’s work at it, let’s try,” Clark said.

“I profoundly object to the idea that the NDP and the Greens want to increase the provincial debt load, they want to increase our interest payments to the banks in New York because they want to increase our credit rating. They want to dump billions of dollars of debt on our kids.”

B.C. Election: Why John Horgan thinks the NDP will make history

As she is so often heard doing, Clark didn’t shy away from boasting about her past government’s economic successes. Clark says her government has created 226,000 jobs since 2013 and soared to being the number one province for job creation in Canada, with the lowest unemployment rate as well.

“We haven’t grown this fast in the province two years in a row since before I was born in 1961… The one thing I know is that life feels unaffordable for a lot of people. The single biggest change in your life that can make it less affordable is losing your job.”

She also touted her government’s record on reducing child poverty — a figure that has dropped by 50 per cent since 2013 — through the Single Parent Employment Initiative. Five-thousand people have used the program so far, she says.

“We’ll pay for your childcare, we’ll pay for your tuition, we’ll pay for your books, your transportation. We’ll keep your welfare cheque coming for a year, until you can get the training that you need.”

But Clark’s stance on social assistance is another polarizing issue. The B.C. government has neglected to raise social assistance rates for the last 10 years while the cost of living — especially the cost of housing — has increased. But Clark says an increase in rates “doesn’t really make it that much easier.”

While she says her government raised disability rates twice, because “that’s for people who really can’t work,” she says money should be spent on getting people off “the treadmill of social assistance,” through programs like the Single Parent Employment Initiative.

“The economy is growing and government has the means to be able to invest in a lot of things – which we’re doing – like 3,000 new teachers in education, more money for healthcare. We can look at those things as the economy grows.”

If an NDP government were to take office next week, Clark says B.C.’s economic future could look more like the past.

“If the economy shrinks, we’re back to the 1990s when we ran out of money. That was a time when the NDP cut a third of the beds in hospitals.”

Other issues Clark took aim at include the softwood lumber deal — which she says she would stand up to U.S. President Donald Trump in order to achieve — and banning thermal coal exports. The latter, she says, is an environmental policy that has earned the Green party’s endorsement but not the NDP’s.

According to the Ministry of Energy, Mines and Petroleum Resources, coal is B.C.’s largest single export commodity and represents over half of the total mineral production revenues in the province. Thermal coal accounts for between 10 and 30 per cent of coal production.

“I think banning coal exports is the right thing to do for the environment. I’ve been really surprised that the NDP haven’t endorsed it. It’s the filthiest form of energy production. If we can’t burn it in Canada, then why are we shipping it to Asia for them to burn it? It’s all the same air. I think it’s the right thing to do.”

Another policy Clark says is “the right thing to do” is to tackle sky-high real estate prices by increasing supply. Her government already introduced a 15 per cent foreign buyers tax, a two per cent luxury tax and removed the property purchase tax for homes under $750,000, among other initiatives. But home prices keep going up.

Vancouver real estate could experience ‘market whiplash’ as home sales jump: report

“The next step, should I be elected premier for my second term, is work with cities to make sure that there is way more rental supply out there on the market,” Clark said. “One of the reasons rent is so expensive is because owners can charge basically anything they want, because there are more people that want to rent. Let’s build more density, especially around transit stations, and let’s get more housing on the market.”

Clark’s opposing party leaders Andrew Weaver and John Horgan have other views on housing, and argue Clark let housing prices rise out of control while raking in billions in taxes from the real estate sector.

It’s that kind of inflammatory opinion that has driven a wedge between the candidates this election season and fueled rounds of attack ads. Despite their campaign trail bickering, Clark says she could work with either leader in office, and admits her relationship with Horgan has seen better days.

“After the election I’m sure we can find our way back to being a little bit more friendly,” she laughed.

She was more complimentary of Green Leader Weaver, who she says shares her love of collaborating.

“I have a joy working with Dr. Weaver,” she said.

B.C. Election: Andrew Weaver says ‘neither Liberals nor NDP can be trusted with majority government’

Her ability to “work with anyone,” she says, goes back to days as a kid discussing politics around the kitchen table. She calls her father one of her greatest influences, saying he told each of his children that they had something to contribute, no matter their opinion.

“We always talked politics and shared opinions around the table. I had three brothers and sisters, so it was like mayhem around the kitchen table. My dad’s whole thing was that everyone had something to contribute. It didn’t really matter what we said, but we all got a chance.”

B.C. voters will have the opportunity to contribute their opinion on Tuesday, May 9,the outcome of which Clark isn’t dwelling on.

“I don’t spend a lot of time thinking about what is going to happen on election day because it’s not my decision,” she said.

As for that Mary Tyler Moore reference? Clark says the 70s sitcom star was her idol growing up.

“I wanted to be Mary Tyler Moore. I was born in 1965, so in the early- to mid-70s, there was only one woman on TV who was like – she was like throwing the hamburger into the shopping cart. She didn’t care because it wasn’t all about cooking and cleaning. She was going to go out and have a job and make something of herself. She was determined in the face of all of the bias that women faced even more in those days. And she was sweet, and she was loveable, she was funny, and I wanted to be Mary Tyler Moore.”

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Liberals, NDP forced to notice emerging Green party in B.C. election

By Camille Bains, The Canadian Press on May 4, 2017.

VANCOUVER – Voters in British Columbia head to the polls on Tuesday as the Liberals aim to cling to power and the New Democrats try to take it back after 16 years in Opposition.

Experts say the emergence of the Green party for the first time in Canadian provincial politics has injected some defining moments into an otherwise ho-hum campaign.

Green Leader Andrew Weaver was in both debates during the month-long campaign with Liberal Leader Christy Clark and the NDP’s John Horgan.

Here’s what else experts said about the issues that they think have resonated with voters:

Hamish Telford, political science professor at the University of the Fraser Valley:

“We have not had a provincial election in Canada where the Green party has played a strong third-party role. Even with Elizabeth May at the federal level she has not got into all the election debates so the Greens make this a very different election in Canada, and certainly in B.C.”

Telford said the Liberals have run a “hard and cold campaign” by repeating the message of lowering taxes, controlling government spending and growing the economy. “There’s no real love in this message.

“Overall, the NDP is running a better campaign than they did the last time. John Horgan has been a vigorous campaigner in the sense that he’s attacking the Liberal record.”

Telford said Weaver “has presented himself as a credible alternative to the traditional parties. That’s a big stride for a new party in the system.”

Telford said Canada’s first Green member of a legislature is aiming to gain at least three more seats to get more resources in the house.

Jeanette Ashe, political science professor at Douglas College in New Westminster, B.C.

“B.C. is historically a polarized system and the fact that the Greens have done well makes us consider whether or not we might be moving toward a three-party system,” Ashe said.

“The consequence of the growing popularity of the Greens is that it’s pushing the other parties to reconsider their environmental policies.”

Ashe said the Greens’ opposition to the doubling of the Kinder Morgan pipeline from Alberta to B.C., a project supported by the Liberals, forced the New Democrats to state their stance against it. “For some prospective voters, their position had been unclear.”

“All the parities are trying to appear more environmentally progressive, and I think that’s just in response to the growing popularity of the Green party. The voters are demanding it.”

Ashe said gender diversity is increasingly becoming a big factor for political parties around the world in an effort to represent all constituents. When one party leads the way with a diverse slate, as the federal Liberals did in the 2015 election, a “contagion effect” leads opponents to react, she said.

The NDP said it has the highest number of female candidates, at 51 per cent.

The Greens said 37 per cent of their candidates are women. “We recognize that this is not nearly good enough in terms of gender parity,” the party said in a statement. “This is an issue all parties face as there are systemic barriers to women running for office. We can and we must do better to support more women running with the Greens.”

The Liberal party did not respond to requests for information on the percentage of female candidates on its slate, but a count of its candidates suggests 41 per are women.

Michael Prince, political science professor at the University of Victoria:

“The televised debate is clearly the single-most important political event in terms of making or breaking reputations or shifting moments. For Andrew Weaver, it was a great night. Greens were treated as a co-equal party. In the past, the Greens have been almost an afterthought.”

“He’s on the side of the angels in terms of deciding not to take any corporate or union donations in the last year,” Prince said of Weaver in a province often described as the “Wild West” because of its lack of strict rules around accepting donations.

“I think Andrew Weaver is morphing from a scientist, an academic, into a political performer or a politician. Their platform has matured over the first two or three elections. They’re clearly not just playing to the environmental file. They’ve got some good policy ideas on education, health care, and housing.”

Richard Johnston, political science professor at the University of British Columbia:

“This is an election singularly lacking in defining moments,” he said, adding the Greens have steadily gained credibility as a viable alternative to the two traditional parties.

“I do have a sense that people are really tired of the premier, and that includes the business community. She doesn’t have the credibility that (former Liberal premier) Gordon Campbell did. On the other hand, there isn’t anything about the NDP that makes them somehow more credible than they have been over the decades.”

“If I were a New Democrat I’d be pretty damn angry about Andrew Weaver,” Johnston said. “Weaver gets treated as a progressive, and of course there is much in the Green program that is progressive, but it is a kind of soft progressivism that does not address hard questions of poverty, inequality, the workplace, the redistributive elements of taxation, the stuff that goes to class divisions in society.”

– Follow @CamilleBains1 on Twitter.

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Revenue minister suspends political activity audits of charities

The Liberal government is suspending the few remaining political activity audits of charities after an expert panel report recommended removing a political gag order imposed on them by the Conservatives five years ago.

As an immediate first step to respond to the panel’s recommendations, National Revenue Minister Diane Lebouthillier “has asked the CRA to suspend all action in relation to the remaining audits and objections that were part of the Political Activities Audit Program, initiated in 2012,” a release Thursday said.

The panel report, also released Thursday, and the suspension together appear to end a long chill for charities that began in 2012, when the Conservative government launched 60 political activity audits, starting with environmental groups that had criticized federal energy and pipeline policies.

Fatal Plane Crash Memorial 20161028

Prime Minister Stephen Harper’s government ordered a series of 60 political activity audits of charities in 2012, starting with environmental groups that had criticized energy and pipeline policies. (Jeff McIntosh/Canadian Press)

A spokesperson for the minister, Chloe Luciani-Girouard, said Thursday’s suspension affects 12 audits, of which seven have resulted in an intention to revoke charitable status.

The program cost environmental, anti-poverty, human-rights and religious charities significant staff resources and legal fees, and brought an “advocacy chill” to the sector, with many groups self-censoring lest they be caught in the Canada Revenue Agency’s net or annoy their auditors.

The Liberal Party campaigned in the 2015 election to end the “political harassment” of charities, but once elected did not quite end the program. Instead, the new government cancelled six of the political activity audits that were yet to be launched, but allowed audits already underway to continue.

The government has suspended political activity audits of charities5:21

That left groups such as Environmental Defence and Canada Without Poverty, which were deemed too political by CRA, still under immediate threat of losing their charitable status. Thursday’s announcement lifts that threat, at least until the government responds to the panel recommendations.

The five-member panel, chaired by Marlene Deboisbriand on the board of Imagine Canada, says Canada’s charity law and regulations are too restrictive and vague. It calls for changes to the Income Tax Act to delete any reference to “political activities” with regard to charities.

Would change enforcement

The change would be “to explicitly allow charities to fully engage, without limitation, in non-partisan public policy dialogue and development, provided that it is subordinate to and furthers their charitable purposes.” The CRA would also dramatically change its enforcement activities.

The panel report, based on wide consultations last fall, also said there was broad consensus in the charity sector that partisan activities — endorsing particular candidates or parties — should remain forbidden.

The panel recommended that a charity’s political activities, whether pressing for a change in government policy or buttonholing a politician, be judged on whether they further the group’s charitable purpose.

The proposed changes would eliminate current rules that restrict a charity’s political activities to 10 per cent of their resources. Critics have argued the rules are unclear on definitions of what constitutes a political act.

“Problems with the legislative framework and its administration have left the sector and its regulator stuck on a merry-go-round of consultation, clarification and concern for nearly four decades,” says the report.

“We believe it is time to break this cycle, and this is what we intend with the recommendations in this report.”

Canada Revenue Agency

The Canada Revenue Agency is suspending action on 12 political activity audits of charities. (Canada Revenue Agency)

Tim Gray, executive director of Environmental Defence, welcomed the report and suspension.

“It’s what I was anticipating,” he said from Toronto. “They’ve listened to the public, they’ve listened to the charitable sector. I’m really pleased that the government is going to respond positively to the report.”

Environmental Defence, among the first charities targeted by CRA in its political activity audit program, said it has spent about $500,000 in staff resources and legal fees defending itself over the last five years.

The panel heard from 167 individuals in seven cities, and received 420 unique online submissions (apart from people signing online petitions). The report’s recommendations are most closely modelled on modern charity law in the United Kingdom.

Panel members include the CEO of the David Suzuki Foundation, Peter Robinson, and a charities lawyer and partner at Miller Thomson, Susan Manwaring.

Lebouthillier said she has shared the panel report with Finance Minister Bill Morneau, whose department is responsible for the Income Tax Act. She did not indicate when the government will officially respond to the findings.

About-face in policy

The revenue minister’s decision to suspend political activity audits, as recommended by the panel report Thursday, amounts to an abrupt about-face. Last year, Lebouthillier refused to intervene, saying the “independence of the charity directorate’s oversight role is a fundamental principle that must be protected.”

“The minister of national revenue does not and will not play a role in the selection of charity audits or in the decisions relating to the outcomes of those audits,” she said at the time.

Her spokesperson Chloe Luciani-Girouard said Thursday’s reversal follows the minister’s direct engagement with the charity sector in the last year, as well as the panel’s specific recommendation on suspensions.

Charity coalitions and groups responded positively to the report and the audit suspensions.

“The current rules are confusing and difficult to interpret, and broad reform is preferable to administrative tinkering,” said Bruce MacDonald, CEO and president of Imagine Canada.

Leilani Farha, executive director of Ottawa-based Canada Without Poverty, also welcomed the news, but said her group will continue with a constitutional challenge of the Income Tax Act until the law is actually amended to allow charities to have a political voice. 

Follow @DeanBeeby on Twitter

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Notley, Alberta NDP hit mid-mark in government term

EDMONTON – Premier Rachel Notley and her NDP hit the halfway point of their term Friday, riding an orange wave of popularity into office to lead Alberta’s sluggish economy toward a green future, buoyed for now by barrels of red ink.

Notley says her team has come a long way from the days when it grew overnight from a four-member opposition to a majority of more than 50 with a mandate to govern.

Notley once characterized it as trying to build a plane while it’s in flight.

Not so much now, she told reporters Thursday.

“Sometimes I’ll sit down and just look at a list of what we’ve done over the last couple of years – and that list is really long,” said Notley.

“Yeah, we’ve made mistakes. As you build the plane while it’s in flight, you do that.

“(But) there’s a sincerity and an authenticity of the dedication of the people in my government and my caucus, and I’m very proud of how they’ve been maturing and I’m proud of how we’re making progress.”

May 5, 2015, was one for the history books, when Notley’s team toppled a Progressive Conservative dynasty that in the eyes of some had rotted from within after more than four decades in power.

In the last two years, Notley’s team has been remaking how Alberta spends, saves, and delivers energy and electricity while grappling with thousands of job losses as oil revenues – Alberta’s lifeblood – plummeted.

The NDP has resisted calls from the opposition to slim down the civil service and find other cuts. Instead, it has doubled down on lost revenues by taking advantage of low interest rates to catch up on building hospitals, schools, and roads left fallow by the Tories.

The result is a construction boom and a continued level of government service, but also eye-popping deficits that have exceeded $10 billion in each of the last two years.

Alberta’s credit rating has gotten warnings or downgrades and interest payments are now over $1 billion a year.

The opposition parties say Notley has refused to make the hard decisions, putting future taxpayers on the hook.

“They have gone and utilized their ideology to move the province in one particular direction without any kind of accountability or transparency,” said Wildrose Leader Brian Jean.

Ric McIver, the Progressive Conservative leader in the legislature, said while it’s still best to govern, his new role in opposition has its advantages.

“I get to get up on my feet and explain to Albertans just how bad this government is,” said McIver. “It’s such a target-rich environment.”

There have been mistakes, particularly the rollout of a controversial farm safety bill that was passed late in 2015. The bill puts farms under occupational health and safety rules and allows paid farm help to get Workers’ Compensation benefits.

Fears the bill would strangle family farms in red tape were worsened by contradictory information disseminated by the province. There were massive protest rallies at the legislature, threats to Notley and caucus members.

“As a former resident of rural Alberta, it’s just inexplicable how badly that (bill) was handled,” said Lori Williams, a political scientist at Mount Royal University in Calgary.

But Williams said, overall, she gives Notley high marks for a collaborative leadership style, bringing together a coalition of oil people and environmentalists for her climate plan. That plan, which includes a carbon tax on gas and home heating, was cited by Prime Minister Justin Trudeau as a key reason he approved new pipeline projects last year, including a vital expansion from Alberta to the B.C. coast.

The NDP has also made front-line changes to help families, including school nutrition programs, new rules for payday loan operators, and cuts to school fees.

It ran a gender-balanced slate of candidates in 2015, then struck the second gender-balanced cabinet in Canadian history and created Canada’s first stand-alone Status of Women ministry.

The conundrum for the NDP now, said Williams, is that Notley is far more popular than her government.

“I’m struck by the number of people who say, ‘I’m not an NDP supporter, but she’s doing a pretty good job,”‘ said Williams.

“It’s really the Rachel Notley show. There’s no way around that.”

Calgary pollster Janet Brown said she hears the same thing.

“People tell me, ‘I think the premier knows what she’s doing, but she has a lot of really inexperienced people on her team,”‘ said Brown.

The second half of Notley’s term will see the run-up to the election and more jockeying among the two main right-centre opposition parties.

Jean’s Wildrose party and the PCs, who have elected ex-federal Conservative cabinet minister Jason Kenney as their new boss, are in talks to merge.

Greg Clark, the leader and only Alberta Party member in the legislature, says a merger would likely move those parties further right, away from the political centre, opening up possibilities for his team as centrists look for a new home.

“We’re seeing a shift in the political landscape,” said Clark.

Brown said how the parties fare in 2019 is a mug’s game at this point. The NDP won in 2015 because Albertans were concerned about education and health care, she said.

“Everything Albertans are thinking and feeling they’re filtering through the economy right now,” said Brown.

“And that is making it really challenging for (Notley’s) government to stay popular under those conditions.”

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Liberals spent $53,948 on Canada Goose jackets

Ontario taxpayers got Canada Goosed.

The Ontario Ministry of Children and Youth Services spent $53,948 buying staff at youth correctional facilities luxury brand Canada Goose parkas to keep them warm on the job.

Progressive Conservative MPP Sylvia Jones had made repeated tries to get an explanation for the expense that turned up in the 2015-16 public accounts.

Jones said she’d heard a rumour that the coats were purchased for staff, and a ministry spokesman later confirmed to the Toronto Sun that was the case.

“It speaks to an out-of-touch ministry or government that doesn’t understand the optics of a children and youth ministry buying luxury clothing items,” Jones said Thursday. “What do they embroider on the back of the coat? We’re from the government and we’re here to help? C’mon.”

While the ministry is not releasing the cost of each coat, they can easily retail for $1,000 per parka or more.

Many provincial workers require cold-weather gear, including those who spend all day outside, but aren’t outfitted with the posh parkas.

Alicia Ali, a spokesman for Children and Youth Services Minister Michael Coteau, who was not the minister at the time of the purchase, said the coats are owned by the ministry and are returned when a staff member changes jobs.

“We operate a number of youth justice facilities across northern Ontario in order to keep young people close to home and connected with their communities,” Ali said. “When necessary due to low temperatures coats are provided to staff who are supervising and engaging in outdoor recreational activities with the youth in our facilities.”

Ali said the Canada Goose jackets were purchased in bulk to save money after receiving no other “qualified bids” in an open, competitive bidding process.

“We are committed to spending dollars wisely so that staff have the supports they need to tough the cold weather throughout our province, all while delivering quality services to young people,” she said.

Canada Goose did not return a request for comment.

Jones said it was hard to imagine how the Kathleen Wynne government could defend such a purchase, especially when there had to be more affordable options available.

”It’s a Ministry that by its very mandate has to serve and protect vulnerable children,” she said. “Where is the mandate that says, and while you’re protecting vulnerable children and fighting for services, you should be walking around in a luxury Canada Goose parka?”

The ministry is charged with providing support to children on the Autism spectrum and with other special needs, indigenous children and youth, children and teens up for adoption, and youth in a variety of custody centres from open custody to secure custody.

Jones said the government has been reluctant to provide her with any information on the parkas.

In January, the PCs put in a Freedom of Information request for the unit cost of the parkas, and were told that Canada Goose didn’t want the price released for competitive reasons, she said.

“It’s a bit of a dog’s breakfast in trying to get to the bottom of it,” Jones said. 

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Canada, Mexico should seek more free trade deals: Bank of Canada

By Anthony Esposito

MEXICO CITY (Reuters) – Hefty house prices increases in Canada’s largest city are not sustainable and have been driven in part by speculation, the head of the Bank of Canada said on Thursday, but he declined to comment on troubled mortgage lender Home Capital.

Central bank Governor Stephen Poloz, speaking in Mexico City about the risks of U.S. protectionism, was asked repeatedly about Canada’s housing sector and he reiterated concerns about signs of speculation in the hot Toronto market, which some fear is a bubble.

“You have the ingredients for higher housing prices, but no fundamental can give you the basis for a 30 percent increase in price in a year,” Poloz said in response to questions from audience members and reporters.

“We’re pretty sure that this is not sustainable, it’s certainly not sustainable by any of the models we’ve got.”

He said he hoped rules the government put in place will help calm the housing market. Ottawa has tightened mortgage lending rules several times in recent years to cool the market and prevent home buyers from taking on too much debt.

Asked if he was monitoring or concerned about the situation with alternative mortgage lender Home Capital Group, which the Ontario Securities Commission has accused of hiding fraudulent mortgage broker activity from shareholders, Poloz said he would never comment on an individual company.

Home Capital shares fell 12 percent on Thursday after a regulatory hearing to investigate claims the mortgage lender and three of its long-time executives had misled investors was adjourned until next month.

In earlier comments to business leaders, Poloz said uncertainty about U.S. trade policy is weighing on growth and business investment but both Canada and Mexico can thrive by striking trade deals with other countries.

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Stiff drink… Canada recalls double strength Bombay Sapphire gin after production mistake

Canadian authorities on Wednesday recalled gin distributed by Bermuda-based Bacardi, after inspectors found the alcohol content was nearly twice the level advertised on the bottle.

It is the second time in recent months that a liquor recall was ordered because of a too high alcohol content.

In March, hundreds of bottles of Georgia Bay Vodka with a whopping 81 percent alcohol level were removed from store shelves.

Ontario’s Liquor Control Board was the first to report the latest incident, asking consumers to return bottles of Bombay Sapphire brand London Dry Gin “due to high alcohol content.”

Four other provinces soon followed, warning Canadians not to consume the gin, sold in 1.14 litre bottles.

Consumers were told that their money would be refunded.

Bacardi said the affected batch is believed to have been sold only in Canada.

According to a statement from the Ontario Liquor Control Board, the problem was traced back to the production line. “One batch was bottled before correct dilution to achieve the stated 40 percent alcohol content by volume. As a result, the affected batch has alcohol content by volume of 77 percent,” it said.

No illnesses associated with consumption of the gin have been reported, said the Canadian Food Inspection Agency.

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