The CBC recently prepared a short segment on the Canadian cancer society. Here are a few comments on the issue. I will update this page over the next few weeks as more information comes to light.
Here are the numbers from the CCS annual report on their spending which were not cited by CBC.
Research 48,886,000 48,364,000
Support for people living with cancer 36,240,000 36,545,000
Prevention 21,196,000 22,815,000
Information 14,424,000 15,149,000
Advocacy 6,462,000 6,533,000
Totals 127,208,000 129,406,000
Looking at these numbers it would appear that research is a top priority for the CCS. In fact from 2011 compared to 2010 research has increased slightly and all other categories have decreased slightly.
The impression some people were left with after reading the CBC article or watching the clip was that the CCS spends $48 million on research and wastes the rest of the money. I think that a good argument can be made that supporting people living with cancer, supporting cancer prevention programs, providing information to people about cancer, advocating with government to change policies and funding priorities as well as research are all legitimate charitable priorities and expenses. The board of CCS has an obligation to consider its resources, the need, and how it can deploy those limited resources for maximum effect and not just to toss money at the squeakiest wheel.
SPENDING ON RESEARCH
The amount of funds spent by the Canadian Cancer Society on research over the last 10 years was up, but the percentage of the total budget spent on research was down. In 1999, 41.9 million was spent on research and in 2011 48.9 million was spent on research. Apparently there are ups and downs depending on fundraising revenue and bequests – which CCS only has some control over. Presumably this story may result in less fundraising revenue in the 2012 fiscal year, perhaps resulting in all areas of funding being cut.
The numbers that CBC provided me are relatively constant from 1999.
44,984,000 2003/2004 (change in year ends)
As noted above, I believe that research, support for people living with cancer, prevention, information and advocacy are all important and part of CCS’s mandate. I was asked by the CBC whether I thought it was “shocking” for CCS to be spending more on research but less of a percentage of the total budget. My response was no I don’t consider that shocking and that there are a number of different facets to the mission of CCS as posted on their website and they needed to balance different strategies of which research is but one. I understand that we know quite a bit more about cancer today than a decade ago and it is important that not only research be done, but that the public be apprised of the results of that research (education) and that prevention programs be put in place to avoid cancer rather than fighting it.
The mission of CCS is:
“Mission: The Canadian Cancer Society is a national community-based organization of volunteers whose mission is the eradication of cancer and the enhancement of the quality of life of people living with cancer” http://www.cancer.ca/Canada-wide/About%20us/CW-Mission.aspx?sc_lang=en#ixzz1RMo3I5ov
CCS is not a pure research foundation like some charities that have no choice but to spend their funds on research and may not have a mandate to spend on anything else, even if those funds would be better spent that way. Incidentally, if people want to donate to CCS and restrict their funds to one of the areas covered in their mandate they can certainly do that even though in some cases that adds to administrative costs and reduces the flexibility of a charity to respond where the need is most urgent or important.
When thinking about what is the correct allocation of charity funds one cannot look at one organization and how much it spends on a particular charitable objective (research) vs. other charitable activities like education, prevention, support of cancer survivors and ignore all other organizations within the sector. Even though is a large national charity it accounts for only a small part of cancer research spending in Canada (11%) and obviously a tiny part of global spending.
Ask a researcher whether more funds should be spent on research - not likely you are going to find many who think less should be spent on research. Not surprisingly, those involved with education, awareness, prevention, advocacy also think their work is equally important. To lump that work all under “other” by CBC does not give a viewer a sense of the importance of that work.
As mentioned above, CCS accounts for about 11% of Canadian research funding in Canada. How can one look at research and not discuss the funding provided by the Canadian Institute of Health Research (CIHR) at 28% and the Canada Foundation for Innovation at 20%.
There are over 250 cancer charities in Canada and many other charities that deal in one way or another with cancer. You can read more about cancer research in Canada at: http://www.partnershipagainstcancer.ca/resources-publications/research/ccra-reports/
Research on cancer is global in nature. To discuss research in the purely Canadian context is misleading. Discoveries in other countries are beneficial to us and what we discover is beneficial to others. Is more or less money being spent on cancer research around the world? Is cancer a neglected disease like some diseases that afflict only poor people? Are the critics of the CCS suggesting more funds be spent on Cancer research or more funds be spent on research in Canada and specifically their own research?
There was a comment that CCS is deceiving donors because funds are spent on matters other than research. In fact when I was first contacted by CBC and was asked about such an allegation my response was I have no idea what CCS is saying but let’s look at their website. On the national home page there is no reference to research. Instead the page located at http://www.cancer.ca/ mentions “We are a national, community-based organization of volunteers, whose mission is the eradication of cancer and the enhancement of the quality of life of people living with cancer.” On the national subpage it has 6 drop down menus – one of which deals with research and others include Prevention and Support/Services http://www.cancer.ca/Canada-wide.aspx?sc_lang=en
After spending five minutes at the CCS website it is very clear, despite what one researcher says, that the CCS is being abundantly clear that it takes a varied approach to dealing with cancer that is more than just research.
In my view CCS is far more transparent than many charities - both providing consolidated amounts for the national and provincial branches as well as individual amounts from each of the national and provincial groups on the T3010 filings. Their disclosure is admirable - they even include lotteries as fundraising expenses which many charities do not. Many charities have reported extensive fundraising without any fundraising costs. That is a story that I suggested that CBC actually follow up on.
The financial statements are posted on the CCS website at: http://www.cancer.ca/Canada-wide/About%20us/CW-Financial%20statements.aspx?sc_lang=en
Deciding on which charity to support just by looking at the financial statements is an elemental mistake made by some who don’t understand charities and ignore the mission of the charity. For example, CCS thinks that it is important that funds be spent on research and they have expended a lot of money convincing the Canadian government to spend $100 million on Cancer research per year. This government funding is greater than the amount spent by the CCS on research. So CCS spends money to get funds allocated to cancer research but gets no credit for that in its financial statements as those funds are not provided to CCS but rather directly to the organizations that do research.
SPENDING TIME FUNDRAISING
There was a quote in the CBC article:
“Cancer researchers are spending a lot of their time, or most of their time, trying to figure out how to get the money to fund their research, rather than actually doing research,” Lichty said.
I don’t think that it is only cancer researchers who spend time trying to find resources for their projects. Many charities are in the same boat – instead of spending all their time on charitable activities they are forced to allocate time and resources to grant writing and fundraising. Furthermore, as there are more charities than funds to support all their missions it is increasingly competitive environment that charities are working in.
INNAPROPRIATELY LUMPING ADMIN AND FUNDRAISING TOGETHER
Charities in Canada spend money on charitable programs, fundraising, administration, political and other activities. To lump fundraising and admin together is unhelpful to say the least. I have written a full article on the importance of Canadian charities spending necessary amounts on administration. The CCS number is 4% which seems pretty low to me.
How Much Should A Canadian Charity Spend on Overhead
The CBC report notes: “Instead, the reports reveal that the area that’s getting the greatest portion of donor dollars is fundraising, up from 26 per cent of all monies raised in 2000, to 42.7 per cent in 2011.” According to the numbers from CBC 42.7% actually represents fundraising and administration not just fundraising. I discussed above why fundraising and administration are not the same thing.
CBC is making another mistake – in order to accurately work out the fundraising ratio cost to raise a dollar they are mistaking cost for raising a dollar with with revenue from all sources divided by fundraising costs.
If one spends a minute looking at the CCS financial statements for fiscal year 2011 you see fundraising revenue of :
Relay For Life $54,263,000
Annual giving $48,317,000
Major and planned gifts $33,419,000
Special events $23,649,000
Lotteries (note 16) $23,869,000
You also see fundraising expenses of
Fundraising -lotteries (note 16) $22,988,000
What is quite clear is that the inclusion by the CCS of lotteries (revenue of 23.8 million but expenditure of 22.9 jacks up the CCS ratio.) -while this may be correct, other charities don’t necessary include lotteries. Here is CRA’s Guidance on Fundraising and what it says about lotteries:
“6. How does the CRA regulate fundraising activities such as lotteries or charitable gaming?
Most aspects of lotteries and gaming are regulated by the provinces and territories rather than the CRA. Therefore, if a charity is in compliance with provincial or territorial regulations regarding costs, revenues, and returns for lotteries and charitable gaming, the CRA will generally not examine these aspects of a charity’s fundraising activities.”
Media needs to understand the legal obligations of charities - much of which can be picked up on CRA’s Guidance on Fundraising.
Furthermore, CBC are comparing the total revenue of $212,707,000 which includes government funds, investments etc,. by the combined fundraising (including lotteries) and admin numbers of $95,075,000. Ratios are supposed to be calculated based on fundraising costs by fundraising revenues as set out in the CRA Guidance on Fundraising.
I would suggest that a more correct way would be to calculate fundraising revenue by fundraising cost and exclude the lotteries, as buying a lottery ticket is not a gift and they often have very high ratios.
Here are the numbers:
169,494,000 fundraising revenues (if no lottery)
63,522,000 fundraising expenses (if no lottery)
If you exclude lotteries the fundraising ratio for CCS in 2011 is about 37%.
You can see The CBC article and clip at: Cancer Society spends more on fundraising than research
You can see the Canadian Cancer Society’s response at:
A further Canadian Cancer Society response is at:
Here are some interesting comments from the comments part of the CBC site:
at 12:38 PM ET How incredibly shameful and childish of Lichty and his group to throw the entire organization under the bus because their funding got cut. The drop in funding that will result in donors reading this article and no longer giving will do a lot of harm to a lot of people and that is really all on the hands of Lichty and his selfish group. The way that they presented this information seems misleading, what I want to know is if the funding for research, prevention and other programs is lower or higher than before. I am not nearly as interested in the percentage as I am in the actual amount earmarked for research grants in the CCS’s budget. It is really to bad that CCS doesn’t have a better media strategy because it really doesn’t sound like they are doing any damage control here and wouldn’t it be a shame if the organization fell as a result of this childish man.
at 11:48 AM ET Those of you saying the CCS is a bunch of fat cats lining their own pockets while blithely covering up the fact that cancer has already been cured by (insert pet theory here), all I have to say is SHAME ON YOU. No one works for a health charity because they want to cash in. The people I know who work and volunteer for this organization are dedicated, hard-working people who have lost loved ones to the disease, or watched them go through treatment, or are survivors themselves, or just want the work they do to be about something more than money. If they were wanting to get rich, they wouldn’t be in the non-profit sector!
One article I read on this subject admits that this huge fundraising expenditure includes the multi million dollar (and completely NON-DONOR-FUNDED) lottery, which takes in not much more than it spends on prizes and promotion. If you took that out of the numbers I suspect the picture would be quite different.
As for the chunk blithely lumped together as “other” in the pie chart, some of the comments are treating it like some kind of random slush fund. As if anything other than research is wasted! Doesn’t the old saying say an ounce of prevention is worth a pound of cure? If the society really was in bed with Big Pharma, there would be far less emphasis placed on prevention and early screening.
And do you really think advocacy and support programs are wasted money? Tell that to the newly diagnosed patient struggling to understand what is going on, or the family dealing with palliative care and support, or the old lady with no family nearby going through treatment all alone.
Finding a cure is important, but so is trying to lower the number of people getting sick in the first place, and helping the people who are sick now.
at 11:41 AM ET I am having a problem with the general public taking into account only what is spoon fed to them and not actually seeking out the facts. Stop being lazy!!
at 9:54 AM ET It really pains me to see so many people willing to accept the information posted in this article as gospel without even once questioning its validity. Has anyone gone to the Canadian Cancer Society website to try to verify the data? I would guess not as you would soon see that it is inaccurate.
Also interesting that a researcher who was funded by the CCS for 5 years now feels it necessary to slam that same organization and spread false information simply because he is no longer receiving funding, sounds a little like a child’s temper tantrum. Could it be that perhaps the reason this research is no longer being funded is because it is no longer considered the most promising research?
And perhaps (but not necessarily) there has been a drop in the level of research funding from the CCS, but is it not also important to investigate ways to PREVENT cancer, offer services to those who are currently going through treatment, and offering information for those newly diagnosed?
We are talking about a disease that is made up of over 200 different types of diseases, so we are all fools if we believe there is 1 cure out there. If it were easy to find cures we would already have them for things like MS, heart attacks, Diabetes, or THE COMMON COLD!
Perhaps before posting that CCS is “criminal” and “wasting funds” from its donors people should question the validity of the information presented above. And if you think that the people working for CCS are making the “big bucks”, visit a local office!
I am a current donor, and will remain a donor of the CCS because I believe in the work that they do, the decisions that they make and most importantly I want my family and friends to have access to all of the programs and services CCS offers.
at 2:51 AM ETAnyone running a business knows that when sales are down, advertising go up in absolute terms and also as a proportion of the budget.
If the Society kept advertising at a fixed proportion of donation income, any drop in income would yield a drop in fundraising which, in turn, would lead to a further decrease in income and a further decrease in fundraising effort—a vicious circle resulting, finally, in no income at all.
At any time, there is a particular level of advertising and fundraising expenditure that maximizes the net funds available for other actitivies such as research. If the Society spent all of its money on research, as some researchers seem to want, the revenue stream would dry up very quickly. You can’t maximize net income, except in the very short term, by shutting down the production plant.
In short, if people gave more in donations, there would be little need for such desperate fundraising efforts and a much smaller proportion of income could be spent on fundraising, leaving a very much bigger sum for research and other services.
Remember also that the Cancer Society does more than research. In recent months, a provincial Cancer Society funded very expensive treatment for my brother which was not covered by provincial health care. Further, the treatment the Society funded was, in fact, essentially a research investment, monitored by researchers, to assess the efficacy of the treatment. Without funding of the medication, the researchers involved would have been sitting on their thumbs.
Researchers aren’t the only worthy set of claws grasping for donation funds. The view from through the slits of an ivory tower is very self-serving, narrow and distorted. And, yes, I spent much of my working life in an academic setting
at 10:01 PM ETI am troubled with the slant that CBC has given to this story and I am also troubled that the Canadian Cancer Society declined to be interviewed.
I looked up the mission of the CCS, which is “the eradication of cancer and the enhancement of the quality of life of people living with cancer”. In my small rural community, I see the CCS taking a leading role in educating people how to avoid getting cancer, encouraging governments at all levels to set policies that make us safer from cancer, providing information on all types of cancer, and helping people to quit smoking. I also have seen the numerous pamphlets that are available to everyone at no cost, and I know of people with cancer who need to travel to Winnipeg for treatment and the CCS provides that transportation for minimal cost. The Society also recruits and trains cancer survivors like myself to be available by phone to support others who are beginning the journey that we are already on. These activities cost money to provide - volunteers like me do not magically connect with others who need us. I am grateful for all that CCS does, including research. I am very concerned the CBC has given a simplified view of the Society, implying that it is somehow not doing what it is supposed to - then unfairly in my view, does not tell its viewers what that is. The CBC implies that CCS spends too much to raise money. I say, compared to what? Does CBC believe that there is no cost to fund raising? Events like the Relay for Life require organization, publicity and, yes, administration. A real question is, “Does the CCS run a tight ship, or not? ” CBC’s reporting did not enlighten me on that at all. I expect better journalism from the CBC. I wish the CCS had consented to an interview and helped CBC to widen its focus.
at 7:59 PM ETInterestingly, CCS annual reports from 2004-10 are on-line at their website and provide a breakdown into revenues and expenses.
Seems like CCS tried to increase fundraising efforts to increase revenues starting in 2004-5. Revenues have gone up over 2004-10 which is remarkable given the 2008 recession. However, to raise the additional donations, the costs of fundraising seem to be considerable so that additional dollars raised have not be great after the additional fund raising expenses are removed. The added dollars have gone toward increase research, advocay, information, prevention, support, prevention. The Managment and general costs are about 5% of total revenue and actually have fallen between 2004 and 2010. I suspect that CCS will be looking at its return for the higher fund raising costs. I am not sure how much more donations could have been raised and funds available for research and other core CCS activities. I think support, advocacy, prevention, information etc are within the remit of the charity and expectations of donors. It is not just about funding research.
Seems like headline hype is not conveying the whole story. I will await CCS response with interest.
at 3:32 PM ETFirst off, how in the world do any of you think charities run? That magically fairies, working for free, pull countless hours in cubicles? Also I find it annoying that they didn’t break apart fundraising and administrative costs. Paper, pens, computers, photocopiers, like any office. And if you combine the research and “other” which includes advocacy, prevention and support you should note that is where more than 50% of their finances are going.
I hate how people think that working for a charity means dolling out the least money you can to professionals who are actually BRINGING in the money in the first place. The majority of those donations would not get in and get processed if there weren’t responsible paid employees. They deal with private information, credit card numbers and other personal information - and you’d all like to sell that short? If you don’t pay people appropriately they end up in the private sector…now what happened to ANY research money?
It is not all about research. Prevention and advocacy our huge factors for Cancer, since many are associated with environmental impacts (like dumping a ton of waste in our water/air), nutrition, sexual transmitted disease (HPV) and smoking/cosmetic products. Putting money towards fighting something CONNECTED to modern cancers is just as valuable as research, especially if it helps to prevent Cancer in our future population.
Everyone on here is so negative - talk to people who have positive experiences with the Cancer Society. Always so quick to be critical of a charity.
Do you require legal advice with respect to Canadian or Ontario non-profits or charities?
Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.