Canadian Manufacturing

Documents show Ottawa unprepared to alter job training approach

Appears poised to push ahead with controversial skills-training initiative despite provincial opposition

OTTAWA—An internal document suggests Ottawa is preparing to push ahead with key features of its controversial skills-training initiative, despite provincial opposition and calls for flexibility.

The nine-page federal document, sent to at least one province, appears to retain all the elements of the Canada Job Grant proposal set out in the March budget.

The document claims it builds on consultations with “stakeholder groups” in May and June, and says Ottawa is “looking to discuss the detailed design” of the program with the provinces.

“As soon as possible, the Government of Canada will arrange a bilateral meeting to discuss the elements of the proposal in more detail and initiate negotiations toward new agreements as quickly as possible to ensure they are in place by April 1, 2014,” says the draft document, obtained by The Canadian Press.

The document also makes one clear demand of the provinces and territories: that they give the federal government credit for the program once it is in place.

“P/Ts will be expected to … publicly acknowledge the Government of Canada’s contribution, including the Canada Job Grant.”

The Harper government made the $900-million Canada Job Grant the centrepiece of its March budget.

The finance minister argued that fundamental changes were required in provincially run job-training programs because many employers were having difficulty finding workers with the right skills.

Despite the criticism, and with no program in place, the government spent hundreds of thousands of dollars on TV ads extolling the merits of the program.

The opposition NDP has accused the government of adopting a “divide and conquer” strategy, quoting a media report that the document was sent to a few western provinces, which are more likely to be sympathetic, but not others.

The objective of the initiative is to match training with available jobs by offering a grant of up to $15,000 to employers for training for each employee, with the cost shared equally between Ottawa, the province or territory, and the employer.

But the provinces immediately objected to federal intrusion into provincial jurisdiction.

Provinces are also balking at Ottawa forcing them to put up $300-million from their own budgets while it was also withdrawing $300-million in transfers from existing training programs—a double cash whammy for fiscally challenged provinces.

As well, they objected to the idea being dropped on them without prior consultation.

Canada’s premiers meeting in Niagara-on-the-Lake, Ont., this week have pledged to fight the initiative as currently drafted.

At the very least, they are demanding that Ottawa allow for a fully compensated opt-out clause and that it jettison the requirement for provincial financing.

A report from the Caledon Institute of Social Policy also criticized the federal approach, noting that it calls on provinces to “cancel their own ground-tested programs and then to expect them to find substantial new funding from their own budgets to pay for an untested new federal program in an area of provincial jurisdiction.”

The institute called the program “deeply flawed public policy (that is) likely to deliver inferior results,” noting that large companies are likely to take both the federal and provincial grants for training they would have done in any case.

The Canadian Federation of Independent Business (CFIB) has also expressed concerns that small firms will be unable to take advantage of the program.

A spokeswoman for Jason Kenney, who last week was appointed the new minister for employment and social development, said the job grant has been “widely praised by a variety of employer groups.”

She said Ottawa would discuss implementation with the provinces over the summer and fall.

The document suggests any flexibility would need to take place within the broad parameters already outlined in the budget.

Ottawa is offering to renew its $500-million Labour Market Agreements with the provinces and territories for four years, starting next April, it says.

But by the fourth year, 60 per cent of that transfer will go to the implementation of the Canada Job Grant, leaving only $200-million to be run as the provinces see fit.

“As part of the renewal, the LMAs (Labour Market Agreements) will be transformed to directly connect skills training with employers and jobs for Canadians with the Canada Job Grant as the centrepiece of the new agreements,” says the document.

Among the requirements, Ottawa is demanding that provinces spend their full allocation each year, that they provide “independently audited financial statements” within six months of each fiscal period, and report to Ottawa annually on plans, activities to minimize administrative burden, and results.

“The Government of Canada will use P/T information to report nationally on results of investments,” it adds.

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