Imagine being an executive director of a local charity whose grant from the City of Winnipeg may suddenly be reduced by 10 per cent. Now, imagine you have already spent or allocated that funding and have to replace it in a competitive funding environment.
This reduction is exactly what happened last week to many non-profits and charities. In an effort to reduce expenditures, the 2013 budget announced plans to reduce annual grants to certain non-profits and charities. Organizations such as the Manitoba Children's Museum, St. Boniface Museum, United Way of Winnipeg, Poverty Action Strategy and Winnipeg Harvest face reductions of $2,000 to $45,000.
These proposed reductions occurred without much notice or consultation with non-profits and charities. Nor are the cuts strategic. It is an arbitrary 10 per cent cut across the board to selected organizations. To be sure, the city sought to protect inner-city services from this round of cuts, but how can this be reconciled with cuts to the poverty action strategy and Winnipeg Harvest? Presumably, organizations such as these are just as important to addressing concerns in the inner city.
The substantive cut to United Way of Winnipeg is equally concerning. The budget proposes a $40,000 reduction to an important project launched by the United Way of Winnipeg. Simply known as Peg, this project tracks indicators ranging from health, environment, education and the economy to determine the wellbeing of our communities. What makes Peg potentially powerful is its ability to gather evidence that can be used when analyzing complex policy problems such as poverty. If we have an understanding how and why communities are thriving or barely surviving, governments, including city council, are in a better position to respond over the long term. This important source of evidence is still in its early development, so an unexpected funding cut may detract from the progress of this project.
Some will argue that the city needs to save money and funding cuts are necessary. This is debatable, but the point made here is the city needs to be more proactive in developing a supportive partnership with non-profits and charities. In much the same way the business sector needs a stable taxation and regulatory climate, the non-profit and charitable sector also needs stability in funding.
As citizens, we know the important services non-profits and charities provide such as health, food banks, cultural and recreational activities and so on. But non-profits and charities do much more than just deliver services. They help nurture trust between citizens and represent a variety of interests (for example, accessibility needs for Manitobans with disabilities) in the public-policy process that might otherwise go unnoticed.
City council needs to construct its funding processes to support all of these activities. The city must transform itself into a supportive partner that understands the challenges faced by non-profits and charities. Recent research concludes that, much like the rest of Canada, the non-profit and charitable sector in Manitoba is dominated by small organizations with limited revenues. Understanding this reality means a deeper appreciation for a 10 per cent funding cut. A smaller non-profit or charity will face much more difficulty absorbing a 10 per cent cut than a much larger non-profit or charity with revenues in the millions of dollars. But even a larger non-profit or charity may struggle with a 10 per cent cut because there is more competition for funding coupled with fewer resources from funders.
City council should engage the non-profit and charitable sector to discuss how funding arrangements can be improved to better meet the needs of non-profits and charities. Multi-year funding opportunities or phased-in funding cuts with advanced notification wherever possible would likely be better options.
A supportive funding relationship is particularly important in the Keystone Province, because we rely heavily on the services offered by charities and non-profits.
Manitoba's per-capita number of non-profits and charities is one of the highest in Canada. Imposing these kinds of arbitrary and sudden funding cuts only hurts non-profits and charities and the citizens they serve.
Proposed cuts to funding should be rescinded until the city can build and complete an engagement strategy with the non-profit and charitable sector.
Karine Levasseur is assistant professor of political studies, University of Manitoba.