Skills Development Fund selection criteria is biased and unregulated
Within the past two years, Doug Ford has faced many corruption allegations, such as those inspired by the Auditor General’s report on the mismanagement of the Greenbelt. These claims have once again been exacerbated with the recent release of the Office of the Auditor General’s report on the Skills Development Fund (SDF) Training Stream, which analyzed all five rounds of the SDF, from the launch of the project to its most recent round.
The SDF is a provincial government program that funds businesses in targeted sectors for projects related to training or hiring. The initiative was launched in 2021 to combat the effects of COVID-19 on the economy. One of the goals of the SDF is also to target “underrepresented groups, including youth, newcomers and Indigenous persons, to help them access employment opportunities.” The objectives of the program have been to support and build an inclusive workforce, encourage innovative training, and reduce employment barriers. In order to receive funding, businesses must submit applications which are then ranked by the Ministry of Labour, Immigration, Training, and Skills Development as ineligible/poor, low, medium, or high based on criteria such as “how well the project need was demonstrated, the applicant’s organizational capacity to deliver the project, the project delivery plan and the project budget.” Different criteria were developed for each round. The Minister’s Office (a separate bureau from that of the Ministry of Labour) then decides which applications will be selected for funding, and how much funding to allocate to projects.
In general, the Auditor General’s report found that the Ministry’s evaluation of applicants was “reasonable and accurate” within the evaluated sample. However, some of the criteria, which resulted in a higher ranking, were not always indicative of better performance overall. Thus, the Ministry recommended updating the criteria for weighting based on previous outcomes of Key Performance Indicators to improve the efficacy of the evaluations. The Ministry was also found to have lost contact with some participants that had been funded in the first two rounds of the SDF, and will not be seeking them out to gain knowledge of their progress. The Ministry’s worst offence may have been not developing any indicators of performance for the “capacity-building of employers… specific to marginalized groups.” Furthermore, the Ministry did produce a separate report for this group of participants. This is alarming since one of the main goals of the SDF as a whole was to provide gateways for marginalized groups to overcome barriers, but there is no indication of whether this goal is being achieved or even worked towards. However, the Ministry did agree to start tracking these goals starting Round 6.
The main scandal related to the SDF report relates to the Minister’s Office and their selection of candidates for funding throughout all five rounds of the SDF. Out of all the applications in the five rounds, it was found that the Minister’s Office selected only 46% of applicants that were ranked “High” by the Ministry, and 54% of applicants that were selected had been ranked “Medium,” “Low,” or “Poor.” In the first two rounds of the SDF, the Minister’s Office gave no rationale for selecting 193 applications ranked “Medium” and “Low” that received approximately $252 million in funding. This was somewhat corrected in subsequent rounds, where the Minister’s Office provided reasoning behind 91% of its selections in rounds three through five. However, the Audit found that these rationales were not always accurate or relevant. The report gives the example of Round 5, where the Minister’s Office’s rationale for funding five applications included that they had been ranked “High” by the Ministry. All five of the applications had, in fact, been ranked “Low” or “Medium,” calling into question the integrity of the Minister’s Office and their selection of certain applicants. Furthermore, in “57 instances where the Minister’s Office did not provide a written rationale, 38 had been ranked as “Poor,” “Low,” or “Medium” and were still selected for funding.” Finally, throughout all five rounds, the Minister’s Office had not provided a rationale for choosing not to select some applicants that had been scored “High” by the Ministry. By themself, the choices of applicants are highly questionable, and the lack of reasoning provided by the Minister’s Office does not aid the situation. Lack of documentation creates the notion of possible preferential treatment in the selection of applicants, and without a proper understanding of why applicants are selected for funding, it is difficult to suggest improvements for the system as a whole.
Furthermore, the fact that over half of the selected applications were not ranked “High” calls into question the purpose of the ranking system to begin with. The Ministry’s ranking system is in place so that the Minister’s Office selects those candidates with the highest chance of success; however, if the Minister’s Office does not seem to select applicants based on the ranking criteria, it is unclear exactly what system they /are/ using. This concern is made more serious by the fact that the Ministry mentioned they are unaware of the process by which application funding is allocated by the Minister’s Office. There is no apparent standard used to determine which applications are funded and how much funding they receive, and the decisions are often made without providing documentation as to why. This varies from other provinces, where there are strict eligibility criteria and funding caps. There is also “no government-wide or Ministry policy that requires these decisions to be made in the Minister’s Office.” The lack of legislation to regulate the Minister’s Office in the allocation of funding is extremely concerning, especially considering the apparent biases in the selection of applicants. The height of concern stems from the prevalence of lobbyists in the SDF. Based on information available to the public, 64 selected “Low-” and “Medium-” ranked applications had hired registered lobbyists to lobby the Ministry/Minister before they were chosen. These applications alone received approximately $126 million. It is worth noting that 39 high-ranked applications also hired registered lobbyists and received approximately $58 million. These statistics, coupled with the fact that the Minister’s Office does not always provide a reason for choosing to fund certain applicants, highlight potential areas of preferential treatment within the SDF. There is a lack of “fairness, transparency and accountability in decision-making by the Minister’s Office,” which has negative consequences for those applying for funding and for the public.
The Ministry has agreed to the four recommendations provided by the Office of the Auditor General in the report. However, the main problem does not seem to stem from the Ministry, but rather the Minister’s Office. At first glance, these facts may simply seem like gross mismanagement caused by a lack of regulation surrounding the allocation of funding. However, there may be a deeper issue involved—that of corruption. When the Office of the Auditor General published their report on the Greenbelt and its development projects, he was called out for “preferential treatment” and “abuse of power.” So, these stories coming out of the SDF report are not new; in fact, we are witnessing history repeat itself. Billions of dollars were placed in developer’s pockets, and protected ecosystems were destroyed under the guise of solving the housing crisis. The Auditor General exposed the corruption at the management position of the project, and recommended “strengthen[ing] lobbyist registration and regulatory oversight powers of the Office of the Integrity Commissioner,” and over a year later, we see the same issue emerge in the SDF Audit. There are even more examples of the Premier’s questionable spending, and the Auditor General recently released reports on various areas of government spending, including “job training, child care, home construction and climate change.” In their reports, there were comments such as “there is room for improvement” and “it is troubling.” The opposition relentlessly calls out Doug Ford’s government on its corruption, highlighting the troubling number of connections that are emerging between the Ford government, lobbyists, consultants, and developers. One of the lobbying firms heavily involved in some SDF applications was the same one that “managed the election campaign that brought Premier Doug Ford into Office,” according to CTV News. This lobbyist group apparently received at least $100 million in SDF grants, which is concerning considering their ties to government employees. There may have been some conflict of interest involved in the allocation of funds, and Opposition leader Marit Stiles commented, “[w]hat I see happening over and over again is the premier and his government treating this fund like their personal piggy bank.”
Given that the Ministry has agreed to the recommendations of the Auditor General, small changes are expected to improve the SDF and steer it back towards achieving its original goals. The Minister’s Office has yet to make any comment on the situation, but the opposition continues to challenge for objective SDF funding criteria to ensure just and transparent funding. The SDF is a program that has the potential to do a lot of good, and checks such as this one provide the opportunity for change.