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Has No One Read the Deloitte Report?

Contributed by Robert Lyman © 2021

Updated Nov. 3, 2021 to correct points 4 and 6 under “Main Findings”.

Amid the extensive press coverage and public commentary on the Anti-Alberta Energy Public Enquiry, most of the focus has been on the political issues, and more specifically, on the appropriateness of foreign funding to support Canadian environmental organizations in their political opposition to oil sands development and production. What has been almost completely ignored is the report submitted to the Alberta Inquiry by Deloitte Forensic Inc. (Deloitte) and the facts and analysis that the Deloitte report brought to light about the broader and more important issues concerning the funding of efforts to harm the oil sands industry.

https://blog.friendsofscience.org/wp-content/uploads/2021/11/Inquiry-Report-2021-06-21-FINAL_Redacted.pdf

The purpose of this article is to present a summary of the highlights from the Deloitte report and to offer some comments on its importance for public policy in Canada.

Deloitte’s mandate was a relatively narrow one, focused primarily on reviewing the materials gathered by Vivian Krause concerning the financial assistance from foreign organizations to the anti-oil sands campaign and to quantify the amount of that funding over the period January 1, 2000 to October 31, 2020.

Main Findings

• More than 200 Foundations, Canadian environmental organizations (“ENGOs”), Envirolegals (Environmental organizations that use the law and lobbying to pursue their objectives), and United States ENGOs either provided funding, received funding, or participated in some fashion in Alberta Resource Development Opposition.
• Foreign funding directed to Alberta Resource Development Opposition ranges between $37.5 million and $58.9 million over the period 2003 to 2019.
• Most of the Canadian ENGOs enjoy the benefits of charity status under the Canadian Income Tax Act. This allows them to gain significant taxpayer-funded support. ENGOs, however, represent only a small portion of the over 84,000 registered charities, whose revenues totaled about $2.2 trillion in 2018.
• Governments are the largest funders of registered charities. Over the period 2010 to 2018, the federal government provided $72.6 billion, the provincial governments $1.3 trillion and municipal governments $85.9 billion. Foreign funding added $14.9 billion more.
• Over the period of review, foreign foundations provided grants totaling $788.1 billion to Canadian ENGOs. The Gordon and Betty Moore Foundation, Pew Charitable Trusts and the William and Flora Hewlitt Foundation provided about 71% of the total.
• The names of the 31 largest ENGOs ranked by revenues were mostly redacted from the Deloitte report for unexplained reasons. Over the period under review, those 31 ENGOs accumulated over $2.5 billion in assets, received $897.5 million in foreign funding and received $2.1 billion in government funding.
• Environmental Law Organizations, as a separate group, accumulated almost $11 million in assets, had foreign funding of $21.5 billion and received $7.8 million in government funding.
• Deloitte was asked to also examine funding to “Conservative/Market Oriented Organizations” for purposes of comparison. Without identifying the organizations (all the names were redacted in the report) or providing any evidence that these organizations were involved in attempting to sway public opinion on energy issues in Alberta, Deloitte estimated that the eleven largest organizations had $103.8 million in assets, had received $26.6 million in foreign funding and received $39.3 million in government funding.
• As of December 31, 2018, ENGO assets were 24 times higher than “Conservative/Market-Oriented Organizations” and their annual revenues were 12 times higher. The foreign funding received by the market-oriented organizations was about 3% of the funding received by the ENGOs during the period under review.

Activities of Four ENGOs Most Involved in Opposing Alberta’s Oil and Gas Industry

Deloitte was asked to provide illustrative examples of the activities of the anti-oil sands organizations, and they did so with respect to Stand.earth, the Pembina Institute for Appropriate Development, Tides/Makeway, and Dogwood BC. The descriptions of activities funded by these organizations illustrates the broad scope and intent of their operations. Examples include:

• Stopping oil sands development;
• Making it more difficult to finance these projects;
• Stigmatizing the industry;
• Persuading major companies to reduce their use of oil sands production;
• Halting the approval of the Northern Gateway Pipeline;
• Influencing the Canadian government to impose a ban on oil tankers on the northern B.C. coast;
• Amplifying the opposition of First Nations and other communities;
• Organizing the largest act of Canadian civil disobedience in the history of the pipeline fight;
• Curtailing or stopping all modes of oil sands transportation (pipelines, tanker traffic, and oil-by-rail);
• Promoting the narrative that oil sands expansion is problematic, promoting land use decisions that slow expansion and promoting climate policy;
• Providing legal strategies and communications support for First Nations to constrain oil sands development;
• Opposing Line 9 and Energy East pipelines; and
• Leading government relations in Ottawa.

Comments

The detached and forensic tone of the Deloitte report should not obscure the extraordinary evidence that it contained about the large funding of anti-oil sands activity by Canadian ENGOs and envirolegals. The report also highlighted an issue that the Alberta government, to its disadvantage, did not seek to investigate – the astonishingly large role that government funding plays is enabling activity designed to destroy one of Canada’s most important resource industries.

Federal, provincial and municipal governments, on behalf of taxpayers whose interests they should be protecting, are massively aiding and abetting political activities of organizations that oppose Canadian oil industry development, transportation and market access. If these activities were being carried out by commercial enterprises, they would be grounds for seeking protection under our laws governing competition. Instead, the industry opponents get a free ride because they claim to be acting in the name of the environment. The gouging of the taxpayer takes two forms. First, the federal government grants charity status to organizations because they claim to “educate” the public about environmental issues, when this has nothing to do with enhancing the public welfare. Second, governments subsidize the ENGOs directly, thus adding to their financial strength and, indeed, building enormous war chests of accumulated assets with which the ENGOs can go on harming Canada’s economic development long into the future.

The claim that these ENGO political actions are warranted for climate policy reasons does not withstand scrutiny. I will not here add to the long list of reasons why climate catastrophism is not justified on scientific grounds or on the basis of the highly questionable modelling and scenarios used by the Intergovernmental Panel on Climate Change. You can read that elsewhere.

It should be obvious by now that, after thirty years of failed international conferences and constantly growing global emissions that present and foreseeable mitigation efforts are doomed to fail in the face of determined efforts by the less developed countries to grow their economies based on affordable and secure hydrocarbon use. Even if this were not blindingly obvious, one would be left wondering why, of all the dozens of countries in the world that produce oil and gas, the only one that is the target of such a dedicated and vindictive campaign of harassment and economic sabotage is Canada.

Those who, for whatever reasons, oppose Canada’s economic development and income growth have a right in a democratic society to voice their opinions. The rest of us have an over-riding right to ensure that the actions of our own governments as well as those of foreign funders do not perpetrate catastrophic harms on our economies. The Deloitte report made clear who the enemies of our future are.

Example of Tar Sands Campaign grant
https://blog.friendsofscience.org/wp-content/uploads/2020/04/andrew_frank_sworn_affidavit-1-1.pdf

1 Comment

  1. Duane Pendergast

    Looking forward to your evaluation of this EGO, Robert.

    https://climatechoices.ca/

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