Ontario Nonprofit Network Publishes Report on Sector Survey

November 2019 Charity & NFP Law Update

On November 11, 2019, the Ontario Nonprofit Network published Sector 360° Survey: Taking the pulse of Ontario's Nonprofit Sector (the “Report”), outlining its findings from a survey of 447 non-profits, charities, and non-profit co-operatives examining the impact of the 2019 Ontario Budget and related government policy changes on Ontario’s not-for-profit sector. The 2019 Ontario Budget proposed, among other matters, a material reduction in government funding to the not-for-profit sector, the implications of which were earlier discussed in Charity & NFP Law Bulletin No. 448.

The Report indicates that survey respondents were concerned with the impact of budget cuts on their funding streams. Further, organizations raised concerns about the speed at which provincial decisions are made, along with a lack of information and engagement provided by the provincial government to the sector. In this regard, 30% of respondents had decreased their budgets directly as a result of the 2019 Ontario Budget and related policy changes, while a further 11% were unsure of the impact due to a lack of information available to them from the provincial government. Respondents also indicated that fluctuating budgets impacted not-for-profits’ abilities to plan and give consistent service, leaving them in a state of uncertainty. Additionally, 27.6% of respondents indicated that their sector was subject to restructuring, with “major changes” coming to the childcare, employment and training, and healthcare sectors, and expected changes to the community housing, arts, and sports sectors. These changes also left not-for-profits in a state of uncertainty.

The Report also indicates that different sub-sectors were impacted differently by budget cuts. While not-for-profits in the arts, cultural and tourism sub-sector, social services sub-sector, and education and research sub-sector generally saw decreases in their budgets as a result of the 2019 Ontario Budget and related government policy changes, 46% of the respondents in the healthcare sector indicated that their budgets remained the same, and a further 26.7% reported an increase in their budget.

Not-for-profits also indicated long-term challenges resulting from the ripple effect of budget cuts. The Report indicates that 50% of respondents did not have three months’ reserve funds, suggesting that sustainability for not-for-profits may be challenging, particularly in a volatile environment where government funding has been coming late. Regarding the volatility of the sector, the Report also notes an increase in barriers to developing social enterprises in Ontario “in the wake of the provincial government’s decision to walk away from the 2016-2021 Social Enterprise Strategy last spring.” However, not-for-profits raised the greatest concern about systems transformations and the impact of these budget cuts on the communities that they serve. Over one third of the respondents indicated that their ability to meet the demands of their communities would decrease in 2020.

Despite the findings, the Report indicates that not-for-profits were “still holding on to their optimism.” In this regard, more than half of the respondents indicated that they were “confident about making progress towards their missions.” The Report also found that not-for-profits are continuing to become more engaged in advocacy. As a result, the Report recommends better engagement and enhanced partnerships with the government for not-for-profits in relation to delivering programs and services on their behalf. The Report concludes that, despite the obstacles, not-for-profits are resilient and can be flexible, finding creative ways in uncertain times to solve the problems that they face.

Read the November 2019 Charity & NFP Law Update