May 25, 2021
Shortly after the federal election in October 2019, the Governor General delivered the Speech from the Throne setting out the Liberal government’s main priorities for the coming session of Parliament. Following the Speech from the Throne, the Prime Minister issued Mandate Letters to each of his members of Cabinet. These Mandate Letters included the main priorities for each member of Cabinet.
Mandate Letter – December 13, 2019
The Minister of National Revenue, the Honourable Diane Lebouthillier, is responsible for the Canada Revenue Agency (CRA). Like other members of Cabinet, she received a Mandate Letter in December 2019.
The letter contains thirteen priorities. Two of these are of relevance to the CVITP.
1One says the Minister should ensure that the CRA will “proactively contact Canadians who are entitled to, but are not receiving, tax benefits.” This refers to the CRA’s non-filer benefit letter initiative on which we have previously reported.
How has the CRA been doing in addressing this priority? Based on what the CRA has stated in its Departmental Results Reports since it first started reporting on this initiative in 2016, the CRA has not done very much. And the CRA has set the bar incredibly low for defining its own success in this effort. One is left with no sense as to just how well the CRA is doing in tackling the problem of non-filers.
Furthermore, the CRA has not made any connection between this initiative and the CVITP. Yet, it is likely that many of those receiving the CRA’s letter who decide to file are using the existing free return preparation services offered by CVITP host organizations. A more effective CRA strategy for addressing the problem of non-filers should include working closely with the host organizations in its CVITP network to build on the extensive network of contacts these organizations have within their local communities.
2The second states that the CRA should “offer to complete returns for some clients, particularly lower-income Canadians and those on fixed incomes whose financial situation is unchanged year to year”.
How has the CRA been doing in addressing this second priority? While we are aware that the CRA has done this in the past, it does not publicly report any figures indicating what it has done in this regard. Therefore, it is difficult to draw any conclusions about CRA performance with respect to this priority. The CRA offer to complete these returns raises the question whether efforts in this area are genuinely additional to what is being done through the CVITP or simply compensating for declines in CVITP services in specific regions. We are unclear as to whether the CRA still continues to make this offer.
Supplementary Mandate Letter – January 15, 2021
In August 2020, the Governor General prorogued Parliament at the request of the Prime Minister. In September, a new session of Parliament was opened with a new Speech from the Throne by the Governor General. Following the Speech from the Throne, the Prime Minister issued Supplementary Mandate Letters to each of his members of Cabinet. Like other members of Cabinet, Minister Lebouthillier received a Supplementary Mandate Letter in January 2021.
This included seven more priorities in addition to the thirteen priorities set out in her Mandate Letter of December 2019. This makes for a total of twenty priorities assigned by the PM to the Minister. (With so many items identified as priorities, it is reasonable to question whether any of these are really priorities.)
Among the seven are three of particular interest to the CVITP.
1The first instructs the Minister to “work with stakeholders and community organizations to continue to develop and implement free, automatic tax filing services for simple returns, to ensure Canadians receive the benefits they need”. In another article, we lay out three reasons why we think this idea is not going anywhere soon.
2Another priority indicates the Minister should “improve the collection and analysis of disaggregated data related to supports and services offered by the CRA”. This could be very useful in formulating a strategy for better implementation of the CVITP, particularly as we see no evidence at present to suggest that data collection and analysis is being used in a serious way to support the further development of the CVITP. In a forthcoming article, we will suggest some areas for data collection and analysis that could serve this purpose. This will be particularly important for delivering on the third priority we wish to highlight here…
3It is encouraging to see the Prime Minister specifically instruct the Minister to “expand and enhance the Community Volunteer Income Tax Program.” In reality, this is only a reconfirmation of the federal government’s plans which had been identified some time ago. Budget 2018 stated:
“Through Budget 2018, the Government proposes to double the size of the program, helping hundreds of thousands more individuals complete their taxes and access benefits to which they are entitled. This expansion will include funding for additional “year-round” benefit clinics and more outreach activities to vulnerable population segments including seniors, newcomers, people with disabilities, youth and Indigenous communities. With total annual ongoing investments of $13 million in Budget 2016 and Budget 2018, the Government has quadrupled funding to support the Community Volunteer Income Tax Program in recent years.”
No further resources were announced in the 2019 or 2021 federal budgets. Still, it is “better late than never” for the Prime Minister to include this priority in the Minister’s Supplementary Mandate Letter.
CRA Performance on Expanding and Enhancing the CVITP
Consequently, it is fair to ask the question: how is the CRA doing with the implementation of this priority up to 2020? As we show in another article, not well.
As to the 2021 tax season, the CRA has known for some time that the CVITP would have to contend once again with COVID related public health restrictions. Consequently, demonstrating its commitment to enhance and expand the CVITP, the CRA should have been planning for operating in this more difficult environment.
The CRA’s new pilot grant program represents one initiative to expand the CVITP by offering incentives to existing and new host organizations. As argued in another article, we believe that this new pilot is unlikely to achieve its objective as it is poorly designed, with no targeting, insufficient financing and a burdensome administrative process.
Although CVITP might not revert to the level of service last seen in the 2019 tax season, there should nevertheless be a dramatic improvement over the 2020 figures. It will be some months before the numbers get released. However, one early indication suggests that there may not be a strong resurgence in CVITP performance in 2021. In a statement by Minister Lebouthillier marking National Volunteer Week, the Minister indicates that over 14,200 volunteers are registered to support the CVITP this year. That compares with the 18,960 volunteers who registered (prior to the outbreak of COVID) for the 2020 tax season. And the 18,960 figure was already a decline over the figure of 19,240 volunteers registered for the 2019 tax season.
This means there were three volunteers this year for every four in the 2019 tax season. From our experience in preparing returns this year, we have found the virtual procedures to be notably less efficient than those used in person. None of this bodes well for the number of people assisted through the CVITP. The program may continue to struggle this year, as it did last year. Rather than “expanding and enhancing”, “rescuing” the CVITP may be more appropriate.
So where is the CRA in all this? We will show in a forthcoming article that there are signs the CRA now seems to want to backtrack on publicly touting the successes of the CVITP as it grapples with flagging CVITP performance.
Finally, the Supplementary Mandate Letter represents a failed opportunity for the Prime Minister to explicitly draw the link between the CVITP and the federal government’s 2018 Poverty Reduction Strategy. Although the Strategy specifically identified the CVITP as one of the government’s initiatives for helping to achieve its 2020 and 2030 poverty reduction targets, the CRA has at no point in time since the release of the Strategy publicly acknowledged the connection between the Strategy and the benefits program it administers – and more specifically the role the CVITP plays in helping low-income people to access and remain current with the many benefits that are conditional upon the filing of a return.