Labour-sponsored funds also enjoy other forms of public treasury support, the nature of which varies individually. The Fonds de solidarité, for example, is exempt from paying any annual Québec corporate taxes. This status is an anomaly, however, as other funds are subject to the same federal and provincial taxation applied to Canadian private corporations.
More common is direct assistance. This comes in many kinds, such as grants, loans and loan guarantees for institutional start-up, early development and promotion. In some cases, governments also acquire shares (typically, these are a special class without dividend entitlement or other rights) to help overcome capitalization difficulties. Finally, government may contribute directly to specific fund initiatives, such as education and training programs.
Along with giving labour-sponsored funds resources, participating governments have accorded them legal status. Enabling statutes permit them to exist as private entities rendering decisions about investment and related matters without interference by public authorities. The funds must nevertheless abide by very important constraints. Such constraints include issues pertaining to solvency, conflict of interest, and consumer protection as determined by securities law and enforced by regulators at provincial securities commissions. Equally important are legislative strictures which, to paraphrase Louis Laberge, reflect the responsibilities that must accompany tax privileges.Endnote 7
Federal and provincial legislation giving life to funds usually contain a mixture of labour aspirations and government specifications. Originally, these statutes were conceived and drafted, sometimes line by line, through extensive collaboration between union leaders, politicians, and bureaucrats, thus establishing useful prototypes for other jurisdictions in Canada.
Sometimes, statutes contain a summary of a fund's philosophy and essential goals. This is the case in Québec, where the 1983 act to create the Fonds de solidarité sets out the fund's four basic aims to (1) make investments that create or maintain jobs; (2) stimulate the provincial economy; (3) give average working people an investment opportunity; and, (4) provide economic and financial training to workers.
This was similarly done in 1994 in the preamble to the New Brunswick legislation initiating the Workers Investment Fund, which reads:
"WHEREAS the New Brunswick Federation of Labour recognizes the need to support economic development and renewal and considers it to be in the public interest to promote long-term capital formation and broad understanding of local ownership;
AND WHEREAS it is in the public interest to provide the Workers Investment Fund, Inc., with certain authorities for the purposes mainly of making investments with a view to earning income and promoting and maintaining capital retention, job creation, job retention, economic stability and the awareness and involvement of workers in economic matters..."Endnote 8
Such statements defining the mandate of the new institution are generally followed by enumeration of legislative requirements that pertain to: