Notable Findings From Inquiry Into Anti-Alberta Energy Funding

Then-Alberta Premier Jason Kenney (C) announces the launch of the Canadian Energy Centre at a press conference at the Southern Alberta Institute of Technology in Calgary on Dec. 11, 2019. Greg Fulmes/The Canadian Press

Besides estimating the amount of foreign funding going to environmental groups seeking to landlock Alberta’s oil and gas, a recent report from a government-commissioned inquiry highlighted a number of other issues related to funding and transparency.

The first recommendation in the report, written by commissioner Steve Allan, is to improve transparency and accountability in the financial operations of environmental non-governmental organizations (ENGOs) receiving foreign funding.

The report highlights an “exchange fund” program that was operated by the prominent U.S.-based Tides Foundation and its Canadian counterpart Tides Canada, and said that the program, used for donations from either side of the border, “had the effect of obscuring the source of funds.”

The report also emphasized the exponential increase in federal funding for ENGOs since 2015 and the disparity between foreign and government funds going to ENGOs versus “conservative/market oriented organizations.”

The Alberta Public Inquiry Into Anti-Alberta Energy Campaigns, released publicly on Oct. 21, was mandated by Premier Jason Kenney’s United Conservative Party government to look into foreign money funding activism against Alberta’s oil and gas industry.

Opaque Money Trail

Some critics have said the inquiry didn’t find a significant amount of foreign funds dedicated to anti-Alberta energy campaigns, but the report found that the money trail wasn’t always clear.

The report said that between 2003 and 2019, Canadian-based environmental initiatives received $1.28 billion in foreign funding, with $54.1 million earmarked for what was construed as “anti-Alberta resource development activity.”

An oil pump jack pumps oil in a field near Calgary in a file photo. Todd Korol/Reuters

A sizable amount of foreign funding was given in the form of grants to Canadian ENGOs, but the Canada Revenue Agency (CRA) keeps the donor information confidential. And if the granter doesn’t indicate the purpose of the grant in its filings, it’s impossible to know how the funds will be spent. Furthermore, even if the grantor earmarks the funds for a certain cause, it doesn’t mean the grantee will use them for that specific purpose.

This issue is emphasized throughout the report, which noted that “increased transparency requirements should be introduced, requiring clear description of the purpose and aim of any grants made to not-for-profit and charitable organizations.”

While this is a general problem, the report also pinpointed particular mechanisms that make it harder to follow the money.

The U.S.-based Tides Foundation was identified as one of two “re-granters,” (the other being the New Venture Fund) in the anti-Alberta energy campaign, meaning it receives monies from donors and then re-grants them to other groups. Tides is known for providing anonymity to donors who request it while allowing them to direct their funds to the cause of their choice.

Allan determined that the Tides Foundation made 125 grants amounting to over C$10 million to various organizations with a “stated purpose seeking to delay or hinder the development of Alberta’s oil and gas resources.”

The Tides Foundation operated an “exchange fund” program with Tides Canada—consisting of the Tides Canada Foundation and Tides Canada Initiative Society—from 2001 to 2016, which allowed donors in Canada or the United States to make donations in the other country without money ever crossing the border, while still receiving charity donation receipts.

“While the Exchange Fund undoubtedly broadened the giving network, it also had the effect of obscuring the source of funds such that the ultimate recipient of funds was receiving funds from a Canadian donor when, in fact, it may well have been initiated by a foreign donor,” says the report.

Allan identified that four grants sent by the Tides Foundation to the Tides Canada Foundation in 2013, ranging from US$15,000 to US$35,000 (C$15,449 to C$36,047), were re-granted to other organizations, with the stated purpose of opposing the oil industry in Western Canada.

Requests to the entities involved for comment on the Exchange Fund were left unanswered.

Tides Canada Distances From US Counterpart

Tides Canada changed its name to MakeWay in June 2020, citing “years of misinformation” and claiming having been “singled out” by Alberta Premier Jason Kenney for its alleged role opposing the province’s oil and gas industry.

“Smear campaigns about Tides Canada have repeatedly misconstrued the purpose of Tides Canada’s international philanthropic funding and have also conflated it with the US-based Tides Foundation,” the organization said in a statement announcing the name change. “Tides Canada was originally named after the Tides Foundation in the U.S., though over time the organizations have diverged and no longer hold any legal, financial, or governance connections.”

The Tides Canada Foundation’s 2001 annual report said the Tides Foundation was a “sister organization,” and while the above statement mentions that the two organizations “no longer” hold any connections, a MakeWay spokesperson told The Epoch Times that “Tides US and Tides Canada were always independent and separate organizations.”

Alison Henning, director of communications at MakeWay, said in an email that the organization did receive funding from Tides U.S. over the years, but it was always disclosed and only totalled 1 percent of Tides Canada’s international funding between 2009 and 2019.

The CRA audited Tides Canada and other NGOs in 2014 to determine if they complied with political advocacy guidelines. MakeWay’s website indicates that the CRA completed the audit in 2016 “confirming its status as a charity in good standing.”

Federal Funding Skyrockets Under Trudeau

As part of the Allan Inquiry, accounting firm Deloitte Forensic was instructed to determine the increase over time in federal funding for ENGOs.

Prime Minister Justin Trudeau presents his national statement as part of the World Leaders Summit of the COP26 UN Climate Change Conference in Glasgow, Scotland, on Nov. 1, 2021. Ian Forsyth/POOL/AFP via Getty Images

The inquiry found that 26 ENGOs received a total of $41.4 million from 2004 to 2014. Then from 2015 to 2019, during Prime Minister Justin Trudeau’s first term, that amount climbed to over $372.5 million.

Franco Terrazzano, federal director of the Canadian Taxpayers Federation, criticizes the huge volume of federal funding of ENGOs in the face of Canada’s growing debt.

“The federal government was running big deficits during this time [2015–2019] and failed to balance the budget like Prime Minister Justin Trudeau promised, so it’s concerning for taxpayers to see these costs increase like this,” Terrazzano told The Epoch Times.

ENGO Funding Dwarfs That of Pro-Industry Groups

ENGOs have pointed out that the funding they receive is nothing in comparison to the strength of the oil and gas industry and lobby. The energy industry in turn alleges that the ENGOs perpetuate a “David and Goliath” narrative while being bankrolled by left-wing billionaires, according to a report titled “Big Green, Inc.” by the Institute for Energy Research.

The Allan Inquiry examined these competing narratives and said some ENGOs’ submissions criticized the inquiry for not looking into the foreign funding of pro-Alberta energy organizations.

While Allan wrote that investigating this angle was not within his mandate, Deloitte  did examine the claim that these organizations received “significant foreign funding.”

Deloitte identified the 11 largest conservative or market-oriented organizations with charitable status and total revenues exceeding $10 million over the inquiry’s period of review—from Jan. 1, 2000, to Oct. 31, 2020—and found that they received foreign funding of $26.7 million and government funding of $39.3 million during this period.

Comparing the environmental groups based on the same threshold of revenues greater than $10 million and over the same period, the 31 largest ENGOs received $897.5 million in foreign funding and $2.1 billion in government funding.