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Legislation and regulation hindering non-profit sector: report

Non-profit regulation and legislation are so complex that even senior third sector leaders – apart from a handful of charity law lawyers – don’t understand it well, according to a new report published by the Wellesley Institute in Toronto.

“Senior third sector leaders may be familiar with certain regulatory issues, but not the whole picture,” said authors Lynn Eakin and Heather Graham . “This is a problem, since most of the sector does not have access to specialized charity law lawyers.”

Eakin and Graham, authours of Canada’s non-profit maze, said the sector is “struggling to obtain financing from government, through charitable donations and by earning income. Any one of these funding sources comes with considerable regulation and constraints, and when organizations try to use all three funding sources, they are too often thwarted by the regulatory maze.”

“Government needs to acknowledge the need for legislative and regulatory reform…that seeks to support and enable the sector to undertake its work,” said the report, produced by Lynn Eakin and Associates. “The ability of charities and non-profit organizations to respond to changing circumstances and adapt to new demands is seriously impeded by outdated regulation and legislation.

“These constraints on the sector’s ability to adapt are about to become even more critical as the economy worsens and Canadians turn to their local charities and non-profit organizations for help.”

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