Social Policy in Ontario

Tories shouldn’t fold to provincial pressure on Jobs Grant

Posted on June 18, 2013 in Governance Debates

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NationalPost.com – FullComment
13/06/17.   Andrew Coyne

Turn on your television this playoff season, and chances are you will run across an ad from the Government of Canada touting its new Canada Job Grant, unveiled in the spring budget. The ads promise $15,000 in funding for unemployed workers who need training, followed by the usual cheery invitation to “find out more.”

There’s just one catch — well, two, actually. Workers who look up the advertised website will find out rather less than more about the program — for the simple reason that the program, as such, does not yet exist. Ottawa proposes to foot only one-third of the cost of the grants; the remainder is contingent on the participation of the provinces and employers, which has yet to be negotiated.

What is more (less?), it appears some of the larger provinces may never sign on. Quebec has already signalled its outright refusal (but you knew that), while Ontario is promising to be difficult, at the least. A statement from the province’s minister of training released Monday complains the program, while potentially “a valuable tool,” would “force Ontario to re-direct funds currently geared to help the most vulnerable workers.”

A report released the same day by two think-tanks, the Mowat Centre and the Caledon Institute of Social Policy, is harsher. The Canada Job Grant, it writes, is “deeply flawed public policy” that “should be abandoned before it begins.” It slams it as having been sprung on the provinces of a sudden, without evidence of either its necessity or effectiveness — as if it had been “picked out of thin air.” Other than that, it’s a fine idea.

No doubt there are some valid criticisms that can be made of the proposal. Some economists question whether skills training is really an example of market failure, requiring government intervention: If companies are finding skilled workers in short supply, they ask, why don’t they just offer a higher wage? Moreover, many of the companies most likely to apply for the subsidy, as the Caledon-Mowat report notes, would have spent the money anyway.

But if the federal proposal could be improved, that should not be taken to mean no reform is necessary. While there is little evidence of a generalized skills shortage, it does appear to be an issue in certain sectors and areas of the country, notably the resource-rich west, even as workers are idled in other regions. Which indeed seems to have been the impetus for the feds retaking control of the file, in the face of their own previous devolutionist rhetoric: the provinces weren’t getting the job done. A national economy requires a national approach.

Redirecting federal funds from provincial bureaucracies to the schools of employers’ choice, matching specific training to specific workers for specific jobs, would seem to make sense in this light. If there is a role for government here, particularly a federal role, this would seem the best way to go about it.

Much of the provinces’ reaction, as embodied in the Caledon-Mowat report, is steeped in the sort of reflexive provincialism to which so much of the country’s political and academic class is prone. It assumes, without evidence, that the provinces know best. And it asserts, without justification, that the provincial autonomy it so zealously defends should be underwritten with federal money.

The report is indignant that Ottawa should be reasserting a role in labour market training, after so many years in which the trend has been the other direction (“an aggressive federal foray into an area which had been recognized over the last quarter century as within provincial jurisdiction”). Yet it admits that much of that was driven by politics rather than hard evidence: from Meech Lake through the referendum aftermath, Quebec pressed its demands, and the other provinces followed in its wake.

The report is indignant that Ottawa should be reasserting a role in labour market training, after so many years in which the trend has been the other direction (“an aggressive federal foray into an area which had been recognized over the last quarter century as within provincial jurisdiction”). Yet it admits that much of that was driven by politics rather than hard evidence: from Meech Lake through the referendum aftermath, Quebec pressed its demands, and the other provinces followed in its wake

It notes that the effect of the Canada Job Grant would be to withdraw roughly $300-million in funding from the provinces; moreover, to participate in the plan, the provinces would have to put up another $300-million of their own money. The implication, as always in these discussions, is that some sort of dire assault on provincial treasuries has taken place.

But the first is no more than the federal government deciding how it should spend its own money: a radical notion to the provinces, admittedly, who are accustomed to instructing the feds in this regard, even as they decry federal “unilateralism.”

The second, on the other hand, is not an imperative, but a choice. If the provinces would like their citizens to benefit from the program, they can pony up their share. If they don’t want to, no one’s forcing them to.

Of course, that’s as much an issue for the feds: they can’t force the provinces to participate. Ottawa may hope the lure of spending 33 cent dollars will prove as seductive to the provinces as to itself. (What’s not to like about a program that lets two groups of politicians claim credit for the same spending?) But that is to reckon without the provincial instinct for turf-preservation. If enough of them refuse, it really will kill the program before it starts.

So one hopes the Conservative government has a plan B. Rather than meekly fold its tent in the face of provincial opposition, it should step up, and fund the whole of the government share of the grant itself. It can always make the provinces pay in other ways.

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Tags: budget, economy, jurisdiction, participation

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