'Bias' concerns led tax agency to target left-leaning think-tank

A left-leaning think-tank was targeted by the Canada Revenue Agency for a political-activities audit last fall partly because the research and education material on its website appears to be "biased" and "one-sided."

That partial rationale for launching the controversial audit appears on a newly released document that the think-tank, the Canadian Centre for Policy Alternatives, obtained under the Access to Information Act.

The one-page summary sheet, which has some material deleted to protect law enforcement, includes a section entitled "Screeners' comments" that outlines why the Ottawa-based group was selected to undergo an audit of its political activities.

The section refers to two previous audits, in 1989-1990 and 2002, where the tax agency says it first raised questions about the group's political activities, among other non-compliance issues.

"A review of the Organization's website, as well as the previous audit findings, suggests that the Organization may be carrying out prohibited partisan political activities, and that much of its research/educational materials may be biased/one-sided," says the document, a copy of which was provided to The Canadian Press.

52 charities undergoing political activities audits

The internal summary provides an unusual glimpse into the Canada Revenue Agency's audit-selection process, which the agency is normally bound to keep secret.

The Canadian Centre for Policy Alternatives is an avowedly left-leaning think-tank that first won charitable status in 1987, and has become a fixture on the federal scene, known in particular for its so-called Alternative Federal Budget each year.

Its positions on social programs, taxes and the economy often conflict with Harper government policies.

The centre has become one of 52 charities to undergo audits of their political activities, in a new $13.4-million program launched in the 2012 federal budget.

Auditors are looking for any evidence of partisan activity, such as endorsements of political candidates, which is forbidden, as well as any violation of a rule that limits political activity to no more than 10 per cent of a charity's resources.

Initial targets were environmental groups, many of whom oppose the government's energy and pipeline policies.

But the net was later widened to include international aid and social-justice groups, among others, many of whom have been vocal opponents of the Conservative government.

'Advocacy chill' feared

Some observers have said the new audit program has led to "advocacy chill," as charities fear speaking out lest they provoke auditors into de-registering them, potentially drying up donations.

The time-consuming audits can also be costly, including legal expenses.

The Canada Revenue Agency, however, says it operates at arm's length from government and is simply holding charities accountable, ensuring they follow established rules.

A spokesman for the Canadian Centre for Policy Alternatives said the finding of bias is "absurd," since all think-tanks —  whether on the left or right — work from a specific set of values.

"Under this definition, all think-tanks are biased or one-sided, and would not qualify for charitable status," said Bruce Campbell, executive director since 1994.

"The work of all think-tanks emanates from a set of values, progressive or conservative, that guide our research and policy analysis, and as such is biased."

Campbell added that CRA officials never raised concerns about partisanship or political activities after the 2002 audit.

"And we have not changed our practices since then," he said.

"This creates the impression that CRA is redefining 'political activity'."

Campbell added that the CRA has not communicated any compliance issues in the current audit, which got underway last fall and continues.

The internal summary says the current audit is not only examining the CCPA's political activities but will "determine whether or not it continues to qualify as a charitable organization under the Advancement of Education," a specific charity type designated in the regulations.

Educational material  must be 'reasonably unbiased': CRA

A spokesman for the Canada Revenue Agency declined to comment on the audit, citing confidentiality provisions of the Income Tax Act.

But Noel Carisse said a Supreme Court of Canada case in 1999 laid down guidelines for determining when a charity is properly carrying out the advancement of education.

The high court "ruled that so long as useful information or training was provided in a structured manner and for a genuine educational purpose — that is to advance the knowledge or abilities of the recipients — and not solely to promote a particular point of view or political orientation it might properly be regarded as for the advancement of education," he said.

"It is for this reason that the CRA is required to assess whether purportedly educational material is reasonably unbiased and based on a well-reasoned position."

The Canada Revenue Agency does not release the identities of charities currently undergoing political-activity audits, including think-tanks, most of which are registered as charities in Canada.

Among right-leaning or pro-business think-tanks in Canada, two — the C.D. Howe Institute in Toronto and the Macdonald-Laurier Institute in Ottawa — have confirmed to The Canadian Press they are not currently under audit for political activities.

Two others — the Fraser Institute in Vancouver and the Montreal Economic Institute — have declined to comment on the matter.

The Canadian Centre for Policy Alternatives reported $5.6 million in revenues in 2013, with about $40,000 spent on political activities, or less than one per cent of expenses.

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NATO vs. Putin: Ukraine crisis redefining much more than borders

For anyone living nervously at the edge of NATO's eastern borders, there is probably little that could be more reassuring these days than a visit from the U.S. president.

Barack Obama's brief stop Wednesday in Talinn, the capital of Estonia located just over 200 kilometres from the Russian border, will bring him as close as he is likely to get in the near future to Russian soil.

And it's probably as close Obama has come to a provocative move since the Ukraine crisis started.

Officials see Estonia and its sister Baltic states — in Russian President Vladimir Putin's backyard — as NATO's new front line. Obama's stop there is designed to reassure one side of the border, while riling the other.

The visit also kicks off a week that will be pivotal in defining Europe's "new normal."

The way western officials describe it, the continent's security environment has been "turned upside down" in a way they could not have predicted. Just a few months ago, and despite their history, NATO nations and Russia had a formal arrangement that allowed them to work as equals on issues of "common interest."

This week's NATO gathering in Wales is now aimed at taking what was once a collaborative relationship with Russia, and recalibrating it into a more adversarial one.

Military options

Without the threat of military action — which has been repeatedly and explicitly excluded as an option for NATO — insiders acknowledge that sanctions alone will do little in the short term to change Russia's policy in Ukraine.

NATO Secretary General Anders Fogh Rasmussen is urging Russia to cease its military actions and take immediate and verifiable steps towards de-escalation of the crisis in Ukraine. (Olivier Matthys/Associated Press)

So the coming "reset" to relations with Russia involves NATO and its leaders pushing at the alliance's edges, at least trying to appear to be upping the pressure on Russian President Vladimir Putin.

It isn't clear whether it's a strategy that will work. Or that it even should. But other options to which all NATO members might agree are limited.

Later this week, at their first summit since the Ukraine crisis started, NATO leaders will consider establishing a new forward operating base in Poland east of the Iron curtain. They will also likely agree on a rapid reaction force, announced Monday, which could involve thousands of troops at a time from the 28 NATO countries in rotation and which could deploy within 48 hours.

'The bottom line is you will in the future see a more visible NATO presence in the East.'- NATO Secretary General Anders Fogh Rasmussen

Perhaps more vexing (if you look at it from the Russian view), the leaders are hosting Ukrainian President Petro Poroshenko, while the NATO secretary general is publicly stating Ukraine has a right to apply for NATO membership.

"The bottom line is you will in the future see a more visible NATO presence in the East," says Secretary General Anders Fogh Rasmussen.

For Russia, Ukrainian NATO membership is a red line.

So in doing all this, NATO leaders are pushing buttons they know might bring on severe blowback. Putin is not a fan of any form of NATO expansion — in geographic footprint or in membership — however modest.

The NATO summit's inclusion this week of Poroshenko — with whom Putin met a mere week ago to discuss the crisis — will surely be seen by Putin as a direct provocation.

Russian ire

Already in this past week, Putin has been vocal in response. He worryingly reminded the world that Russia is still a nuclear power.

Ukraine president Petro Poroshenko (left) is being hosted by NATO leaders at their summit in Wales this week, while the NATO secretary general is publicly stating Ukraine has a right to apply for NATO membership. NATO's actions are contrary to the wishes of Russian President Vladimir Putin. (Christophe Ena/Associated Press)

And it appears Russia is again pushing at the edges of its own boundaries of influence.  Few Western leaders are using the word "invasion" to describe the entry of Russian troops and military hardware into the southeast region of Ukraine last week, but on Monday leaders did sharpen their language, explicitly naming Russia as a party to the conflict in Ukraine.

That's not likely to sit well with Putin, who has rejected the notion that Russia as a nation has intervened.

Nor will the idea of Ukraine joining NATO, however academic.  Even though, despite the public statements to the contrary, it is highly unlikely Ukraine would join NATO anytime soon. There is too much opposition to the idea inside the organization.

Still, the discussion alone will raise Russia's ire. So does the idea of a new permanent rotation of thousands of NATO troops exercising at Russia's borders.

"I am sure the reaction will be strong," says Heather Conley, senior vice-president for Europe, Eurasia and the Arctic at the Washington-based Centre for Strategic and International Studies. She points out NATO's actions have come only as a response to Putin's "provocative" actions in Ukraine, and his massing of thousands of soldiers at their joint border.

"It will probably, again, provoke the addition of force — Russian forces along this area. So we will see a buildup on both sides, absolutely."

Mixed signals

Insiders acknowledge Putin has time on his side.

On the one hand, Obama and NATO's message for Russia is, "don't even think about messing around in Estonia or in any of the Baltic areas in the same way that you have been messing around in Ukraine," says Charles Kupchan, senior director for European affairs in the Obama administration.

The crisis in Ukraine is giving NATO a new sense of direction and purpose. (Georges Gobet/AFP/Getty Images)

To the Baltic States, NATO is signaling that its security guarantee is "ironclad," Kupchan says — exactly the kind of reassurance Estonia has been seeking.

Yet the alliance has also been at pains to point out it is only taking a defensive posture, and that it has no plans for military confrontation with Russia. Asked directly, Obama concurred. Any new steps taken by Russia in Ukraine will be punished by more sanctions.

Officials have also repeatedly said that NATO enlargement is not on the agenda.

Still, in this crisis, NATO is also presented with an opportunity to re-define itself.

 "NATO should thank Vladimir Putin, because it was really searching for its purpose  ... it was having a fairly significant identity crisis," Conley says.

"It has now not only been repurposed, it has been reinvigorated."

And from the other side of the border, Putin is watching it warily, but closely.

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Feds reinterpret middle class data that painted Canadian dream as 'a myth'

Finance Canada has issued a rebuttal of a politically embarrassing report on middle-class economic woes that was compiled last fall by experts in another federal department.

The duelling analyses highlight an economic issue almost certain to dominate the federal election campaign next year, as political parties cite the same data to make opposite points.

Last October, bureaucrats at Employment and Social Development Canada wrote a scathing internal report on the plight of the middle class, calling the Canadian dream "a myth more than a reality."

The report, obtained by The Canadian Press under the Access to Information Act, was immediately hailed by opposition parties as proof of the financial straits of Canadian families, but it was dismissed by cabinet ministers as outdated and misleading.

In April this year, Finance Canada economists put together a more detailed rebuttal for the new minister, Joe Oliver, using the same data but interpreting them in a more positive way.

The report for Oliver, for example, concludes that "controlling for the changing composition of families, income of the Canadian middle class has grown strongly since 1976.... All major family types benefited from strong income growth."

'Conflict with message' of budget

The analysis faults Employment and Social Development Canada for weak methodology, and for delivering a different message from that of the Feb. 11 federal budget.

"Their analysis arrives at conclusions — namely that middle-income families have stagnant wages, are unlikely to move to higher income groups, and are increasingly indebted — which appear to conflict with the general message in Budget 2014 and previous internal briefings," says an accompanying briefing note for Oliver.

Copies of the rebuttal material, with some significant sections censored, were obtained from Finance Canada under the Access to Information Act.

The new analysis, entitled "Income Equality and the Middle Class: Recent Trends," also uses data up to 2011, whereas the previous report covered the period only to 2007.

While the latest report paints a rosier picture, it also warns of problems ahead.

For example, the authors play down the claim that the middle class is more indebted than other groups, saying households at all income levels show the same levels of indebtedness.

But they also warn that "high levels of household indebtedness and the fact that a significant portion of middle-income families spend more than they earn do pose risks to the economic outlook."

Female workers boost numbers - for now

The Finance Canada study also acknowledges that the key driver of middle-class prosperity in Canada has been women workers, more of whom have been entering the workforce, upgrading their skills, moving to full-time from part-time, and getting better-paid jobs.

The wages they have added to middle-class households have helped maintain prosperity levels, whereas previous generations typically needed only one major income earner in a household to enjoy a middle-class lifestyle.

"Higher employment rates, especially of females, account for most of the increase in working middle-class family incomes," says the report. Otherwise, "middle-class families have not received significant hourly wages increases. This is true in absolute terms and relative to other income groups."

The authors note that the current high employment rates of women means this avenue of income growth for middle-class families will not be available in future.

Liberal MP Chrystia Freeland and Leader Justin Trudeau have been pitching hard to middle-class voters over the last year, but the Harper government has been fighting back. (Sean Kilpatrick/Canadian Press)

The 24-page analysis also acknowledges that income inequality has grown in Canada, as elsewhere in the industrialized world, with the wealthiest one per cent collecting 8.6 per cent of all 2011 income, compared with 5.8 per cent of all income in 1982.

Economist Armine Yalnizyan says the duelling reports show that "depending on your unit of analysis, depending on your time frame, you can make two very solid cases...."

"Clearly, Finance wants to stick with the message track that it's got in the budget.... They're cherry-picking the data they want to look at."

'No second wave' in future

But Yalnizyan, of the Canadian Centre for Policy Alternatives, a left-leaning think-tank, notes even Finance Canada acknowledges the party is over when it comes to women workers buoying middle-class households, because their participation rates are already high.

"That has kept the middle class from sagging," she said in an interview. "But it's not available as a strategy going forward."

The Finance Canada report estimates about 70 per cent of the increase in middle-class household incomes since the mid-1990s can be attributed to higher workforce participation rates, primarily by women workers.

"There is no second wave of women, spouses, entering the workforce," said New Democrat MP Nathan Cullen, the opposition's finance critic.

Cullen said Conservative government policies are also exacerbating the plight of the middle class, with tax breaks that favour the rich and with no effective measures to replace some 350,000 well-paid manufacturing jobs lost in central Canada.

"It's overstating and misrepresenting the facts to say 'nothing to worry about here — in fact, much to celebrate,"' he said in an interview.

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Stephen Harper takes big words, small stick to NATO summit

"Speak softly and carry a big stick."

- U.S. President Theodore Roosevelt, 1900

Canada's modest military might has always made it hard for its prime ministers to strut convincingly on the world stage. Stephen Harper is only the latest to offer stirring rhetorical contributions to the Western alliance, without having much firepower to back them up.

When it comes to speeches, Harper has not pulled his punches, even comparing the predations of Russian President Vladimir Putin to those of Nazi Germany. He says that Putin's "aggressive, militaristic and imperialistic" activities threaten the "peace and stability of the world."

For domestic consumption, Harper's government claims to be leading the Western response. Foreign Minister John Baird has insisted that "no other government has stood up more forcefully and aggressively against the Russian aggression in Ukraine."

Really? Those are big words. But this week's NATO summit in Wales will expose a gap between words and deeds.

Faced with a pressing need to offer more than ringing denunciations of Russian aggression, NATO's 28 members are being challenged to increase their defence budgets.

Harper intends to do no such thing. As long as that's true, Harper will be speaking loudly, but carrying a small stick.

Duelling accounts

So far, Harper seems reluctant to mention the topic. The official account of his pre-summit phone call with U.S. President Barack Obama states that it "focused primarily on preparations for next week's NATO Summit in Wales, where leaders will discuss, among other things, the coordinated response to Russia's efforts to destabilize Ukraine and undermine the country's sovereignty and territorial integrity." Nothing there about boosting defence spending.

By contrast, the White House account of the same call says this: "The president stressed that agreement on increased defence investment in all areas is a top priority at the NATO summit."

A "top priority?" For the U.S., maybe — but not for Canada, where the Conservative government is focused on balancing the budget before next year's election.

Instead, according to the account of the Prime Minister's Office, Harper's goal at the NATO summit is to emphasize what Canada has already done, especially with its fine rhetoric: "Canada's main objectives for the Summit include highlighting its contributions to the Alliance, notably the role it has played since the onset of the Russia-Ukraine crisis by stressing the need for a strong international response to Russia's aggression against Ukraine..."

So: our "main objective" is to "highlight" our role in "stressing the need" for a "strong response."

No doubt, other members of the NATO alliance will hasten to highlight the exemplary power of their own speeches.

But among NATO's key members, only the U.S. — which pays 70 per cent of NATO's bills — and the United Kingdom top the desired level of two per cent of gross domestic product (GDP) in defence spending.

Canada's spending is closer to one per cent of GDP. Greece and Estonia both do better.

Which leaves Canada with a challenge — which it is meeting rhetorically.

Small, but mighty?

The PMO says that Canada's military is "one of the most engaged and responsive armed forces within the Alliance." Perhaps so — but it's one of the smallest.

Canada ranks sixth in spending among the allies and contributes just six per cent of NATO's budget. As a share of GDP, only five of NATO's 28 members spend less than Canada.

It is true that Canadian troops fought effectively in Afghanistan, although how successful the Western intervention there was will be another difficult question for the summit.

More recently, Canada has sent half a dozen CF-18s to Eastern Europe for patrols in response to Russia's Ukrainian adventure, and has also offered support and "non-kinetic" aid to the Ukrainian government. (Apparently, that means it won't hurt anyone. No bullets.)

Canadian CF-18s arrived in Lithuania last week as part of stepped-up NATO patrols on Russia's doorstep. (Sean Kilpatrick/Canadian Press)

But NATO wants something much more kinetic from all its members. It wants a more agile, muscular military deterrent to Russia, kept in a high state of readiness with a rapid-reaction force and pre-positioned supplies close to Russia's borders — notably in Poland. And the outgoing secretary general, Anders Fogh Rasmussen, says that members who want the "insurance policy" of collective defence must "pay the premiums."

Rasmussen will still be in the chair at this week's summit — he doesn't quit until the end of the month — and it's clear that the NATO alliance will, once again, urge its members to raise their defence spending to two per cent of GDP over 10 years — a pledge made before, without success.

Balanced budget required cuts 

The Harper government has not denied that it is resisting this latest proposal. Instead, a defence department statement implies that Canada's already doing enough: "Our government has made significant investments into the Canadian Armed Forces ... Following a decade of darkness under the previous Liberal government, we have increased the defence budget by over 27 per cent. We have also delivered on important procurement projects..." 

These procurement projects, it says, include the frigate modernization program and the Arctic Offshore Patrol Ships — neither of which has, in fact, been delivered. Besides that, the 27 per cent increase takes no account of inflation.

But never mind; we still have plenty of rhetoric. The statement says: "Our government is delivering on its commitment to ensuring Canada's military is strong, proud and ready to defend Canadian interests at home and abroad."

Wrong, says the Conference of Defence Associations, a fiercely pro-military group whose experts concluded in a June report this year that, "adjusting for inflation, the defence budget is now smaller than it was in 2007."

In fact, the report found, defence cuts provided a quarter of all the current year's budget reductions. The CDA adds that, "in real terms, capital spending for major new equipment has declined four years in a row, and remains on a downward trend. DND [the Department of National Defence] has not spent 25 per cent of the amount allocated to replacing major equipment for four straight years. As a share of the defence budget, capital spending has dropped to the lowest level since 1977-​78."

The CDA's conclusion was that "the Canadian Armed Forces' operational readiness is dropping, its purchasing power is being eroded, and future military capability is being reduced." 

Is the "decade of darkness" over? Or is this just a new one? There's no sign that the trend will be reversed soon. But if words are needed, Canada stands ready.

"Canada will continue to work closely with its allies and partners," says the PMO, "and will take further economic steps if Russia continues down this reckless and irresponsible path. We will continue to support our allies in Eastern Europe and take the steps necessary to assist them to maintain their security and national territorial integrity."

Except, apparently, spending money.

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Medical marijuana licence applications up, but approvals slow

The number of Canadian firms applying for lucrative medical marijuana licences has topped 1,000, as a so-called "greenrush" continues to overwhelm Health Canada.

So far, only two new licences have been approved this summer even as the department tightens the application rules -- and as nervous investors await decisions on their multimillion-dollar bids.

Health Canada says that as of Aug. 25, it had received 1,009 formal licence applications to grow medical weed since a call for proposals was issued last year, with 462 returned as incomplete, 201 rejected and 32 withdrawn.

That still leaves almost 300 applications being assessed.

Some 13 licensed producers are actively providing medical marijuana to patients, while another nine Health Canada-approved producers are about to market their products.

Just two new licences were issued in the last three months, raising questions among applicants about why the department's approval process is so slow.

In July, Health Canada tightened the rules for prospective producers, increasing some security requirements to ensure inventories of medical marijuana were stored in secure facilities.

New rules 'have not had an impact' on approval process: Health Canada

A spokesman for the department says the new restrictive rules have not affected the approval process.

"The increased security requirements have not had an impact on the processing of active applications," said Gary Scott Holub in an email.

Even so, some applicants say the move appears to be aimed at smaller players, to discourage them from applying.

And some still-unapproved firms are under pressure from their impatient investors, who have leased buildings, hired staff and paid legal fees with no returns in sight.

"Everybody is just living in fear" of having their applications rejected, said one insider.

"It's a pressure-cooker ready to blow."

Health Canada radically changed the rules for medical marijuana on April 1, to end home-grown weed production in favour of commercial products under a new licensing system.

New industry could hit $1.3 billion in sales

The department expects the new regime will create a private industry eventually worth some $1.3 billion in sales annually with perhaps half a million customers.

Some applicants want to position themselves in the medical-marijuana market for the day when recreational cannabis may become legal.

As of August, some 9,448 clients had registered under the new system to order medical marijuana from the newly licensed commercial producers.

The issue of marijuana has become a hot potato politically, as Liberal Leader Justin Trudeau calls for legalization of recreational marijuana, and the Conservatives oppose the move, saying it would only increase use, especially among youth.

At the same time, Justice Minister Peter MacKay has said the government is examining whether police should issue tickets for possession of marijuana rather than clogging the courts with criminal cases.

Health Canada has imposed no limits on the number of licensed producers.

An estimated 500,000 Canadians use marijuana for medical purposes, though most do not obtain it through Health Canada-approved suppliers.

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Ukraine crisis: Petro Poroshenko accuses Russia of 'direct and open aggression'

Ukraine's military said on Monday it had pulled its forces back from defending a vital airport in the east against Russian tanks, as President Petro Poroshenko accused Moscow of "direct and open aggression."

The withdrawal from the civilian airport outside the city of Luhansk was the latest in a string of reverses for Ukrainian forces fighting pro-Russian separatists who Kyiv says have the direct support of hundreds of Russian troops and armour.

A military statement said Ukrainian paratroopers were engaging a Russian tank battalion near the airport. A while later spokesman Andriy Lysenko said: "In the Luhansk direction, Ukrainian forces have received an order and have pulled back from the airport."

Tipped the balance on the battlefield

Poroshenko, speaking at a military academy in Kyiv, said Russia's direct involvement in Kyiv's war against the separatists in eastern Ukraine had tipped the balance on the battlefield and was the main reason for recent setbacks.

An Ukrainian serviceman walks near an unmarked grave at his position near the eastern Ukrainian town of Luhansk. The withdrawal from the civilian airport outside the city of Luhansk was the latest in a string of reverses for Ukrainian forces fighting pro-Russian separatists (Gleb Garanich/Reuters)

"Direct and open aggression has been launched against Ukraine from a neighbouring state. This has changed the situation in the zone of conflict in a radical way," he said.

There would be changes in the military top brass because of the events of last week, Poroshenko added, referring to the military reverses.

Moscow denies helping the rebels, who have set up "people's republics" in the Russian-speaking east of Ukraine and say they want to be part of the "Russian world" rather than a country which seeks integration into mainstream Europe.

Lysenko said Ukrainian forces had destroyed seven Russian tanks near the airport and had identified a major build-up of Russian forces to the north and south of Luhansk, to the rear of Ukrainian lines.

"According to our operational data, there are no fewer than four (Russian) battalion-tactical groups in Ukraine," Lysenko told reporters. Each one comprised 400 men, he said.

Separatists eyeing port city

Separatists, who Kyiv says were backed by a Russian armoured column, took the town of Novoazovsk in the southeast last week and are now threatening the strategic port city of Mariupol 40 kilometres to the west.

Their seizure of part of the coastline provided them with a vantage point from which to shell a coastguard patrol boat in the Sea of Azov on Sunday, sinking it - the first action at sea in the conflict.

Two members of the crew are missing while eight were rescued and are being treated for burns and other injuries.

Lysenko said the cutter was hit by a missile fired from Bezimenne on the coast, starting a fire. The boat went down later, he said.

Concern is mounting in Kyiv over the fate of several hundred Ukrainian troops encircled for days in Ilovaysk, east of the region's biggest town of Donetsk.

Kyiv's military has imposed an information clampdown on what is happening in Ilovaysk until its forces have been successfully withdrawn.

But Anton Gerashchenko, an interior ministry adviser, told Ukraine TV's 112 channel: "The tragedy near Ilovaysk became possible after (Russian President Vladimir) Putin brought regular troops into Ukraine."

"In all there were 500 men deployed in Ilovaysk. The Russians came with superior forces, fresh, healthy and with a full ammunition set," he said.

"Our people surrendered only when they had run out of ammunition, when they no longer had anything to fire with," he said. In the past 24 hours, 69 more pro-government fighters had managed to break out and rejoin Ukrainian forces, adding to a few dozen others over the weekend.

A United Nations human official said last week the death toll in the five-month-old conflict — including civilians, Ukrainian forces and separatists — was nearly 2,600.

This includes around 800 Ukrainian troops. Seven more Ukrainian service personnel were killed in the past 24 hours, Lysenko said.

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Conservative fundraising runs into roadblock in Quebec

The prime minister's Quebec lieutenant, Denis Lebel, has spent the past couple weeks crisscrossing his home province on what the party is billing as his "End of Summer Tour" — a 12-day trek that has taken him from Charlevoix to Mount Royal to Saguenay and finally to a rally in Quebec City on Friday.

Lebel, who is also the federal infrastructure minister, says in a statement posted to the summer tour's official website that his goal is "reach out" to both card-carrying Conservative supporters and Quebecers at large "in order to listen to them."

"Evidently," he adds, "we also want our message to be heard."

If he really wants to dig deep into the details of his party's often fractious relationship with La Belle Province, though, he may want to dive into the data contained in the latest batch of financial reports filed by Quebec Conservative riding associations.

Conservative riding associations

According to the most recent returns, 30 of the 75 Conservative riding associations in Quebec reported no donation revenue at all in 2013.

An additional 20 associations pulled in less than $1,000 total throughout the year.

That number includes Lebel's own riding association of Roberval–Lac-Saint-Jean, which netted just $650 from three contributors.

In Pontiac — the riding held by former Foreign Affairs minister Lawrence Cannon from 2006 until 2011, when he was ousted by New Democrat rookie Mathieu Ravignat — contributions to the Conservative riding association somehow managed to work out to –$5,301.03.

(How, precisely, a riding association can fundraise a negative number of dollars is a mystery, as they don't appear to have refunded any contributions, which would normally account for such a result.)

Despite those somewhat sobering numbers, Lebel can take some comfort in his party's fundraising prowess in Montreal's Mount Royal, where the looming retirement of longtime Liberal MP Irwin Cotler in 2015 has emboldened Tory hopes of snagging their first seat in metropolitan Montreal.

Not surprising, it was also one of the stops on the minister's summer-ending tour.

Mount Royal Tories top Liberals in donations

In 2013, the Mount Royal Conservative Association raised $19,205 raised from 74 contributors.

To put that in perspective, over the same time period, the local Liberal association mustered up just $3,972 in donations from 59 supporters.

The biggest single haul for Quebec Tories, however, was in Minister of State for Small Business Maxime Bernier's home riding of Beauce, where 236 donors kicked in $45,905 to fill up the local coffers.

Overall, Quebec Conservative riding associations raised $177,733 in 2013.

That works out to three per cent of the Canada-wide grand total of $3,705,750.57.

New Democrat riding associations, meanwhile, raked in a comparatively whopping $348,592.87 in Quebec — just under 30 per cent of the party's Canada-wide total of $1,253,820.47.

Just five Quebec NDP riding associations reported no revenue at all, and 11 brought in less than $1,000.

NDP Leader Tom Mulcair's riding of Outremont pulled in the single highest total —  $22,325 — and the most extensive donor list was reported by Notre-Dame-de-Grace, which garnered the support of 551 contributors.

As for the Liberals, despite the end-of-May deadline, 13 of the party's Quebec riding associations haven't yet filed the required paperwork for last year — including Papineau, home of Justin Trudeau.

Liberals lag behind NDP

The available numbers, however, suggests that, as of last December, the determinedly upward trend the party has been enjoying in the polls wasn't causing a similar boost in fundraising numbers, at least at the local level.

In total, Quebec Liberal riding associations raised $246,945.89 in 2013, which is just over 10 percent of the cross-Canada total.

Of the 62 that have filed returns with Elections Canada, 10 reported receiving no contributions at all, and another 20 took in less than $1,000.  

The biggest windfall landed in Saint Leonard–Saint Michel, which reported $39,227 in contributions, with Brossard–La Prairie fielding the highest number of individual contributors at 264.

The Liberals can, at least, console themselves with the fact that they aren't the Bloc Québécois, whose riding associations raised just $117,216 in 2013.

That puts the once Quebec-dominant Bloc just slightly behind the Conservatives, and in last place, although that number could change, as there are more than 20 associations that haven't yet filed their 2013 reports.  

Of the Bloc riding associations that have submitted their numbers, Bas-Richelieu–Nicolet–Becancour is currently in the lead, with a final tally of $36,205 from 386 donors.

Seventeen associations reported no contributions at all, and 11 took in less than $1,000.

(Methodological note: As only 21 Green Party riding associations have filed reports for 2013, those numbers have been left out of this analysis.)

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Health Canada pulling last of citronella-based bug sprays

Health Canada is pulling the last of citronella-based bug sprays off the shelves by the end of December because of "the absence of adequate safety data." The essential oil has been used as an insect repellent in Canada for decades.

The move has left scientists who advised Health Canada on the issue befuddled by the ban. So are many consumers who prefer natural bug sprays over ones with synthetic chemicals like DEET.

'It's the basis of the ban that I don't really understand'- Sam Kacew, Toxicologist

"It's the basis of the ban that I don't really understand," says toxicologist Sam Kacew.

Insect repellents are considered pesticides so they must meet strict safety standards. In 2004, Health Canada proposed phasing out citronella-based bug sprays because of new questions about its safety.

Small manufacturers who couldn't afford to submit detailed safety data saw their lines discontinued at the end of 2012. Those who submitted what data they could and tried to challenge the ban are now to see their products phased out at the end of this year.

In 2005, Kacew sat on an independent scientific panel to review Health Canada's position. He says the panel believed the study that led the government to question citronella's safety was flawed, in part because it examined what happened when rodents ingested the oil. "Humans are not going to drink citronella," he says.

The department told CBC that "the panel supported Health Canada's approach," but Kacew refutes that. He says the team of scientists concluded that citronella was safe as long as it didn't contain methyl eugenol, an impurity that could be a potential carcinogen. "In general, most of these citronella oils that were available for us to examine did not contain impurities, and they were regarded by us to be basically safe," he says.

Companies pay the price

Montreal company, Druide, has been selling government-approved citronella sprays and lotions since 1995.

"Where I am very sad is, in the end, [Health Canada] doesn't have anything against citronella, except questions about it," says Druide's owner, Alain Renaud.

Health Canada is ordering all citronella-based bug sprays off the shelves by the end of December because of "the absence of adequate safety data." (CBC)

​

He says he spent five years proving to Health Canada that his repellent didn't contain methyl eugenol.

But Renaud says that as soon as he won that battle the government "came back and said we still have questions and we need a complete toxicological report on many generations of animals."

That may be a standard approach, but Renaud eventually gave up his fight because his company doesn't believe in animal testing, and didn't have the estimated $1 million needed to fund a large-scale scientific study.

Druide's citronella-based bug spray was a bestseller for the company, which manufactures organic personal care products.

Renaud says he's had to lay off five employees because of the ban and has lost up to a million dollars spent on marketing his product and providing research for Health Canada. "At the end of maybe, five, 10 years of fighting, [Heath Canada] gets all our energy," he says.

DEET passed Health Canada's scrutiny because the manufacturers provided the required safety data. But citronella — an extract from lemon grass —  has never been patented, which makes it an unattractive investment for costly studies.

"If the market was such that this product was generating millions of dollars, then the industry would have done something re-active to try and get [citronella] back on the market," said Kacew.

That's the problem with other essential oils as well. They may be effective as bug repellents, but no one has yet funded the studies to prove they're safe.

DIY bug spray

Tracey TieF made and sold a natural bug spray with essential oils including lavender and rosemary for seven years before Health Canada shut her down recently.

The problem was that she hadn't registered her product and done any safety studies.

"I can't afford to run my own trial," says the certified health practitioner. "I feel afraid and I feel sick about it, actually, because for me, this is a passion."

TieF now puts that passion into teaching others how to make natural bug sprays. In a tiny room at Karma Co-op in Toronto, she passes out bottles, essential oils and recipes. "I'll teach people until [Health Canada] stops me," she vows.

Aimee Alabaster says she joined the class because she wants a natural bug spray for her children. "Everything out there for the most part contains DEET, and I don't want to put DEET on my kids."

Research has suggested DEET could be harmful to the central nervous system. But Health Canada states on its website that "registered insect repellents containing DEET can be used safely when applied as directed."

Come 2015, citronella bug sprays won't be entirely out of reach, you will just have to cross the border. The product will still be available in the U.S.

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NATO pushes for bigger crisis response brigade as Canada mulls opportunity

Canada will send troops, jets and warships to participate in a massive NATO training exercise next year in a deployment that could be the first step towards deeper involvement in the alliance's long-term strategy to counter a resurgent Russia.

The units will participate in a test of the military alliance's crisis response brigade, The Canadian Press has learned.

The exercise, known as Trident Juncture 2015, will be held in Italy, Spain and Portugal over several months and built around a scenario where NATO responds to an attack against a member country.

"We are planning to commit tactical forces, maritime, air and land to the live (fire) exercise," Lt.-Gen. Stuart Beare, the country's joint operations commander, told The Canadian Press in a recent interview.

It is a significant decision because NATO is pushing behind the scenes to significantly expand the size of its rapid reaction force. The alliance already announced last week it plans to base soldiers in eastern Europe to reassure jittery allies.

The crisis response unit — currently comprised of 13,000 high-readiness troops, a headquarters and reserve formations — operates on a rotational basis with different nations committing forces for up to a year at a time.

Next year's participation in the exercise does not commit Canada to become part of that rotation, but it could set the stage.

"Those are strategic and political decisions," said Beare. "I can't answer the question specifically, but I can tell you we are acting in a way that, if we do, we'll be really, really good at it."

Taking part in the exercise would help the military reacquaint itself with how NATO does business on its home turf, a familiarity that has been lost since the last Canadian Cold War garrison was withdrawn from Europe in the 1990s.

Base in Poland hosted NATO training

What is unclear heading into this week's NATO summit in Wales is whether the Harper government is prepared to foot the bill to be a regular member of the quick reaction force, which U.S. officials have suggested could see its leading elements based in central Poland around a base that hosted NATO training this summer.

Two rotations of Canadian troops, roughly the size of a 150-man company, have taken part in those recent exercises.

Being part of the rapid reaction force carries with it a whole different set of expectations — most notably being prepared to start shooting if a NATO member is attacked.

The detachment is a relatively new construct within the alliance and something defence ministers only began to seriously wrap their heads around in February 2013 as plans were being drawn up for the withdrawal from Afghanistan.

Some members have refused risky missions

Steve Saideman, an expert on NATO, is skeptical about how the force would work given previous missions where countries have insisted on maintaining control over their own troops, and imposed restrictions on what they could do.

That was the experience both in Libya, where some countries refused to conduct risky air-to-ground attacks, and in Afghanistan, which saw a handful of countries like Canada, the U.S., Britain, France, the Netherlands and Denmark do most of the fighting.

"I have a hard time imaging a rapid reaction force being rapid," said Saideman, who is chair of the Paterson School of International Affairs at Ottawa's Carleton University.

"I don't feel confident they'll be able to overcome the problems that have existed and have been baked into NATO."

Article 5 of the NATO charter — the alliance's all-for-one and one-for-all provision — has a little recognized opt-out clause, Saideman noted.

Questions over long-term commitment

He's also not convinced the Harper government is willing to commit the cash necessary for a long-term commitment now that it has extricated itself from Afghanistan. The Conservatives plan a balanced budget for next year's election, and surely hope to spend aggressively on voter-friendly measures, he added.

"It costs money to put troops out there for a period of time," Saideman said.

NATO Secretary General Anders Fogh Rasmussen said the alliance will press ahead with the force and it will be a major topic for leaders at this week's summit.

"We will adopt what we call a readiness action plan with the aim to be able to act swiftly in this completely new security environment in Europe," he said in Brussels.

"We have something already called the NATO response force, whose purpose is to be able to be deployed rapidly if needed. Now it's our intention to develop what I would call a spearhead within that response force at very, very high readiness."

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Canadians expose foreign worker 'mess' in oilsands

Canadian tradesmen from a huge oilsands construction project are waving a red flag about safety hazards and near misses, which they blame on the use of foreign workers who aren't qualified and can't speak English.

"When you bring in a bunch of workers who are unqualified to do this job it's only a matter of time before you kill someone," said Les Jennings, who was an ironworker supervisor at the Husky Sunrise plant until a few weeks ago, when he quit in frustration.

"People are angry and upset," said journeyman ironworker Johnny Demosten, who is still working at the site. He said many of the foreign workers don't know crane hand signals and other safety precautions.

"If they are journeymen, they are supposed to know the signals. It's pretty dangerous."

There are 344 foreigners — skilled tradespeople and others — currently working on site for the Italian-based company Saipem, under contract to build the multi-billion dollar plant 60 kilometres north of Fort McMurray.

The project is over budget and behind its original schedule.

Hazards cited by inspector

"The errors on that site are repetitive and consistent. Mistakes made over and over," said Ryan Slade, a journeyman electrician contracted by Husky last year, as an on-site quality control inspector.

"You used to feel like you were part of something. Now, you feel you are part of the mess."

The Husky Sunrise site is 60 km north of Fort McMurray, Alta. (CBC)

He said he reported numerous serious concerns about safety and poor workmanship, until, he said, managers told him to stop.

"I keep repeating, 'You are having the same problems over and over' and they said, 'Look, we already know this — don't report it anymore,'" said Slade.

"We will always be vigilant in our safety objectives, and we continue to see steady improvement in results due to stronger alignment amongst all companies on site," Husky spokesperson Mel Duvall said in an email to Go Public.  

"We work closely with site contractors on safety, including initiatives for workers to give direct feedback." 

"Those [Canadian] guys who do stay up there they are going to save Husky's butt — I guarantee it," said Slade. "They are going to save someone's life by catching poor workmanship before it kills someone."

Blow torch scare

For example, Demosten said, he and other workers were horrified when a foreign worker took a blow torch to a propane tank to defrost it. Others intervened to prevent an explosion.

"That would probably have killed him and hurt people around him. That's the kind of things these people are doing," said Demosten.

Johnny Demosten and Leslie Jennings, journeyman ironworkers in the oilsands, go public about temporary foreign workers hired by Saipem Canada to work at the Husky Sunrise site. (CBC)

The tradesmen also claim several Canadians with better qualifications have been passed over for jobs, while foreign workers from Europe continued to show up.

 "We had probably 60 ironworkers come to take the jobs from Canadians," said Jennings.

Saipem said it can't comment on some of the Canadian workers' allegations without evidence, but, overall, it called the claims "misleading".

It points out, 85 per cent of its workers on site are Canadian. It also said its safety record is as good or better than industry standard.

Company refutes claims

"We continue to make safety a priority at the Sunrise site, with continued focus on safety awareness and training of all our workers," said Saipem spokesperson Erika Mandraffino, in an email from Italy.

"We strongly refute any and all claims of any correlation between any alleged safety violations and any group of workers that we have at the project site."

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We tell your stories and hold the powers that be accountable.

We want to hear from people across the country with stories they want to make public.

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Many of the foreigners did arrive without Canadian-standard trade certification, however. Under government rules, they have a year before they must take their test.

"These workers, in my opinion — because I worked with them side by side — they are not at the same level as a Canadian journeyman. Not even close," said Jennings.

He said he assigned some of them to shovel snow, while earning the ironworker rate of $44 an hour.

"Probably 75 per cent of [foreign] ironworkers on site were only at the level of a labourer."

Jennings is angry with Saipem, because it used his name and red seal certification number on paperwork approving 15 foreigners to take their certification test, after he said he made it clear they weren't qualified.

"When I found out about that I called the industrial training centre and I had [the test approvals] cancelled," said Jennings.

A company HR person texted Jennings at the time, saying, "It was a mistake… I am not trying to get you to approve guys you are not comfortable with."

Foreign workers fail tests

Even when they take the test, he said, most fail but are not sent home. They get another shot at a later date, prolonging their time on the job.

"They should be made to write that test the first week they get here to prove they know the material — then if they don't know it they should go home."

Foreign workers are shown in this still image from video taken by a worker at the Husky Sunrise plant near Fort McMurray.

The union for both the domestic and foreign tradespeople confirmed several foreign workers failed and are getting a second chance.

"If they are failing the test because they can't read it, then that's a concern about their language and what it can mean for safety," said Izzy Huygen, Alberta representative for the Christian Labour Association of Canada.

When more new workers arrived from Portugal in June, Jennings reacted by emailing Saipem several resumes of qualified Canadian journeymen looking for work.

A human resources manager emailed back, saying, "We are not looking for ironworkers as of now."  Then, in July, another crew from Poland showed up, according to several sources.

"Those ironworkers are still on site. They should have been turned around sent back home and replaced with Canadians," said Jennings.

Qualified Canadians available

Jason Mitchell's resume was one of those Jennings submitted. He said Saipem actually offered him work at the time. He quit his other job as a result, but has heard nothing since.

"I was told I was hired and good to go… I never heard any more. Now I am unemployed," said Mitchell.

344 foreigners are working on-site in Alberta for Italian-based Saipem, which is under contract to build the multi-billion dollar Husky Sunrise plant. (Saipem)

As a test, Demosten recently posted a fake job ad on the web, mirroring Saipem's requirements, to show how many Canadians could have been hired.

His inbox was flooded with 115 applications — most from qualified people — within 14 hours.

One was followed by another email from the applicant's wife, pleading, "Please tell me if he is being considered."

"I felt real bad when I saw that," said Demosten. "More than likely he's sitting at home not working, while there is a foreign worker working."

The federal government rejected several Saipen applications to bring in foreign workers over the last year, because it didn't believe the company couldn't find Canadians for the jobs.

"Employment and Social Development Canada has refused this employer's last nine Labour Market Opinions because the employer was unable to demonstrate that a labour shortage existed or that the employer had made sufficient efforts to hire Canadians," said spokesperson Nick Koolsbergen.

Company gets around gov't refusals

Saipem found other avenues, however. It said some of its current workers came in under a little-known visa option called an "intra company transfer."

The union said the rest came through a pilot project allowing specific trades work in Alberta without federal approval. That program has just been cancelled.

Citizenship and Immigration responded to Go Public's story by indicating the province is responsible for safety and worker qualifications.

Alberta's minister of jobs, skills, training and labour said cases like this need investigation but foreign workers are still needed in the oilsands.

"We shouldn't penalize a whole industry, a whole economy, a whole region because there are some unfortunate circumstances. What we need to do is to get better at investigating those complaints and providing remedy to them," said Kyle Fawcett.

When CBC News asked the federal minister responsible if visas may be revoked in this case and he indicated it's possible.

"We've done it… We have sent people home when their presence here as temporary foreign workers was based on misrepresentation," said Immigration Minister Chris Alexander.

Signs with phrases in foreign languages are up at the Husky Sunrise worksite to help workers communicate with each other.

"We are saying to all employers you will only have access to this program if there's not a qualified Canadian to do the job."

The union said, because of a grievance it filed, the latest crew of new arrivals was pared back from 70 to 20 workers.

"These are widespread concerns," said Nuygen from CLAC. "Safety is definitely one of the top two issues. The other is temporary foreign workers getting jobs ahead of Canadians."

Demosten said foreign workers are still being promoted, however, to higher paying, non-union foreman jobs over him and other certified Canadians.

"People who don't speak English are our bosses. They are telling us what to do and they don't have any idea what to do."

As a result of Go Public's story, the Alberta Federation of Labour is asking the federal auditor general to investigate the use of foreign workers by Saipem at the Husky Sunrise site.

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Submit your story ideas

Go Public is an investigative news segment on CBC TV, radio and the web.

We tell your stories and hold the powers that be accountable.

We want to hear from people across the country with stories they want to make public.

Submit your story ideas to Kathy Tomlinson at Go Public

Follow @CBCGoPublic on Twitter

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