Sep 09, 2020 • Last Updated 13 days ago •
OTTAWA — WE Charity says it is closing its Canadian operations, blaming COVID-19 and the political fallout from the Liberal government’s plan to have it run a multimillion-dollar student-volunteer program for leaving it in financial ruin.
Craig and Marc Kielburger, who are also planning to step down from the organization they co-founded, released an open letter Wednesday explaining the move.
“COVID-19 disrupted every aspect of our work,” the brothers wrote in the letter. “The fallout from the Canada Student Service Grant has placed us as a charity in the middle of political battles and misinformation that we are ill-equipped to fight.
“The financial math for the charity’s future is clear.”
The Toronto-based youth organization shared the news with its Canadian-based staff on Wednesday.
WE’s operations in Britain and the U.S will not be immediately affected. Neither will its for-profit affiliate, ME to WE, which makes money through leadership courses, retail sales and travel programs.
The move represents a stunning fall for the charity, which the Kielburgers first created in 1995 as a way for youth in Canada to help less-fortunate kids around the world.
Few could have foreseen the degree to which the government’s spring decision to have WE administer the now-defunct student grant program would hurt both the Liberals and the charity.
The deal would have seen WE paid up to $43.5 million to run the program. The federal government had budgeted $912 million for the program, which was designed to cover up to $5,000 in education costs for students who volunteered during the COVID-19 pandemic. The sole-sourced contract with WE pegged the cost at $543 million and stipulated the organization would not make money on the deal.
News of the deal prompted immediate questions about Prime Minister Justin Trudeau’s ties to WE. The controversy has since expanded to include former finance minister Bill Morneau. Both face investigations by the federal ethics watchdog into whether they violated the Conflict of Interest Act. Both have apologized for not recusing themselves from the decision to award WE the contract.
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