‘Not fair, transparent or accountable’: Ontario’s auditor general weighs in on $750M in Skills Development Fund grants

Ontario auditor general Shelley Spence speaks to the media following the release of her annual report at the Ontario legislature in Toronto on Dec. 3, 2024. THE CANADIAN PRESS/Chris Young

More than half the time, the Ontario labour minister’s office overrode the opinions of non-partisan staff to dole out around $750 million in grants to a multi-billion-dollar job training fund, according to the province’s Auditor General’s report released Wednesday.

Many of those successful lower-ranked applications to the Skills Development Fund (SDF) were backed by lobbyists, whose projects received $126 million in funding, raising a spectre of possible preferential treatment, the report said — all of it a significant expansion of concerns about the troubled fund.

“The selection process was not fair, transparent or accountable, and there was little rationale to explain why the high-ranked applicants were not chosen,” the report reads.

It’s the latest surprising development in the saga of the Skills Development Fund, which the Ontario government says it slated to give around $2.5 billion for job training for hundreds of grants across the province, coming weeks after CTV News first reported concerns about how millions in grants were doled out.

In one case, Toronto-based company Scale Hospitality received at least $11 million in grants to train workers in its chain of restaurants, despite receiving a low score from bureaucrats.

• READ MORE: ‘Shades of the Greenbelt’: Questions raised about Ontario’s $2.5-billion private career training fund

The company’s managers had given thousands to the governing PC party and hired the same lobbyist whose foray to Las Vegas with a would-be Greenbelt developer preceded the rollback of the controversial land swap program, CTV News reported at the time.

In another case, CTV News revealed a casino, spa and hotel company got some $9 million in grants — millions more than had been announced. Its CEO is also a PC donor. Striking public sector unions have raised questions about how similar programs at nearby public colleges have been cut.

• READ MORE: Niagara spa, casino company among those getting Skills Development Fund grants, drawing complaints from unions

Premier Doug Ford has defended the fund as an important investment in training for an economy hit by the COVID-19 pandemic and U.S. tariffs, pointing to some 700,000 workers trained.

The Auditor General and other political leaders are expected to address the report on Wednesday, which is part of a suite of special reports into the Canada-Wide Early Learning and Child Care Program, the Home Construction Regulatory Authority, and the province’s progress to reduce greenhouse gas emissions.

Wednesday’s report offers a sense of how often political staff picked favoured applications over how bureaucrats ranked them on the published application criteria.

Over the first five rounds of the SDF, the minister’s office selected 1,014 applications, with 465, or 46 per cent, ranked high and 549, or 54 per cent, ranked lower, the report notes.

The selected applications that ranked medium, low or poor received about $742 million, or about 56 per cent of the funding provided to SDF applicants over the first five rounds of the SDF, the report said.

According to the report, 64 low- and medium-ranked applications that received $126 million had hired registered lobbyists to lobby the minister.

“We also identified 39 high-ranked applications that had hired registered lobbyists to lobby the ministry and/or minister before they were selected by the minister’s office. They received approximately $58 million in funding,” the report said.

“This can create an appearance of real or potential preferential treatment by the minister’s office in its selection of applicants to fund. It is also not fair, transparent or accountable to those applying for funding to the public.”

Additionally, the minister’s office didn’t share a reason for why it gave 388 applications $479 million in the first rounds of the program and didn’t appear to update its evaluation criteria based on project results, the report said.

The audit found the projects that had been ranked higher by non-partisan staff did perform better overall on some key performance indicators.

Similar job training funds in Alberta, B.C., Manitoba, and Newfoundland and Labrador don’t involve a minister’s office while making the decision of which project to fund, the report said.

The report says the ministry has accepted all four of its recommendations, including that it updates its criteria to be more reflective of project performance indicators, and in future higher-ranked projects should receive grant money.