Ford government labour ministers overruled civil servants to fund skills training by groups with lobbyists, according to a scathing new report
Ford government labour ministers have selected groups to receive hundreds of millions of taxpayer dollars for worker-training programs against the advice of civil servants who’d evaluated their funding applications, Ontario’s auditor general has found.
Many of those groups hired lobbyists, auditor general Shelley Spence highlighted in a scathing report on the province’s $2.5-billion Skills Development Fund, which her office released Wednesday.
Less than half — 46 per cent — of Skills Development Fund recipients that got funding from the Ministry of Labour were given “high” scores on their proposals by non-partisan civil servants tasked with evaluating them, the auditor found.
Most Skills Development Fund applicants that the minister’s office chose to fund — the other 54 per cent, which received the majority of the $1.3 billion in provincial funding that Spence’s office focused on — were ranked as having “lower” quality proposals, while other high-ranked proposals were denied, she wrote.
Overruling the rankings of the non-partisan civil service, “can create an appearance of real or potential preferential treatment by the minister’s office in its selection of applicants to fund,” the auditor wrote.
Spence’s conclusions about the Ford government’s Skills Development Fund included that the selection process was “not fair, transparent or accountable.”
The value-for-money audit follows reporting by The Trillium on groups with political connections to the Ford government and histories of donations to the Progressive Conservative Party that received generous Skills Development Fund grants.
That includes Scale Hospitality, a restaurant business with connections to the premier’s right-hand man-turned-lobbyist Amin Massoudi. It received three Skills Development Fund grants totalling $17 million to train restaurant workers after its first application was scored low.
The Trillium also revealed that the Social Equality and Inclusion Centre (SEI), which trains people to work in clubs run by Zlatko Starkovski, a longtime associate of the premier, has received $9.8 million from the Skills Development Fund.
Dentacloud, a dental practice brokerage, was given more than $2 million from the Skills Development Fund at a time when its CEO worked closely with the wife of then-labour minister Monte McNaughton, The Trillium has also reported.
The official opposition cited each of these as examples of the government giving cash and preferential treatment to “insiders.”
“If you scored high in your application to this program, you didn’t get the money,” NDP leader Marit Stiles said. “But if you scored low and you had a lobbyist, then you get the money. To me, that is textbook preferential treatment, or in other words, this looks like corruption.”
New Democrats would keep the Skills Development Fund, Stiles said, but rely on the non-partisan civil service to pick the recipients.
Her party is digging deeper into the Skills Development Fund by filing requests for documents, and is considering filing a complaint with the province’s integrity commissioner, she said.
Liberal labour critic John Fraser said his party is also requesting documents and will try to grill the minister in charge at a committee hearing.
“The deeper we dig, the more we’re going to find out,” said Fraser. “This story is just beginning.”
Both Stiles and Fraser said they were reminded of the Greenbelt scandal, which was kicked off in large part by an auditor general’s report.
“It smells like the Greenbelt,” Fraser said. “Wealthy, well-connected insiders, or people who hire people who are well-connected to the premier to lobby for them.”
Ontarians might “feel a little pissed” to learn that restaurant companies in Toronto are getting millions from the government, for example, while the mill they work at in Kapuskasing is closing or their local public college campus is shutting down, Fraser said.
Green leader Mike Schreiner put it this way: “Over and over again, the Ford government prioritizes the interests of wealthy, well-connected insiders over everyday people. Ontarians are paying more and getting less because wealthy, well-connected insiders are making out like bandits.”
Labour Minister David Piccini defended the program and its funding decisions.
“I believe in the power of our Skills Development Fund to change lives, and we know with a rapidly changing environment where we need to train workers to meet the disruptive needs of the workforce, that rapid training initiatives work, and at any age you can have access to training,” he said.
Piccini said he welcomed the report as an opportunity to strengthen the program, but that his office would reserve the right to pick recipients of the funding, despite a recommendation to select recipients from among the highest-scoring applications.
The Ford government has opened applications for the sixth round of grants and has committed to giving another $805 million to groups running worker-training programs over the next three years.
A scathing report
From 2021 to 2025, non-partisan staff in the Labour Ministry evaluated 3,343 applications to the training stream of the Skills Development Fund, according to the auditor general’s report.
They scored them using criteria that weighed proposals’ objectives, the need for the program, proponents’ organizational capacity, their plan, budget and more. Ministry officials scored 1,135 applications as “high” (73–100 per cent), 825 as “medium” (63–72 per cent), 1,065 as “low” (34–62 per cent), 54 as “poor” (1–33 per cent) and 266 as “ineligible,” according to the auditor’s report.
After ministry officials evaluated and ranked applications, they sent them to the labour minister’s office, which selected the ones to fund, according to the report. The auditor general noted that similar programs in a few other provinces “do not involve a minister’s office in the specific project-level funding decisions,” which other funding programs in Ontario’s Labour Ministry also don’t involve.
Through the first five Skills Development Fund rounds, the minister’s office chose to give out 1,014 individual grants, some of which went to multiple-time recipients. Of the recipients, 465 received a grant after their application scored “high,” 267 got funding with a “medium” score, 281 had an application scored “low,” while a single funding recipient was successful after being assessed as “poor.”
The applications ranked “medium,” “low” and “poor” received about $742 million, or about 56 per cent of the funding provided over the first five rounds of the program, the auditor found. The auditor general also found five instances in the fifth round of the program in which the minister’s office said it granted funding to groups because their applications were scored “high” by ministry officials, when in fact they were ranked “low” or “medium.”
Applications that were initially ranked “high” by civil servants performed better than those receiving lower assessments, according to the auditor’s detailed analysis of projects’ success in meeting their key performance indicators (KPIs).
The auditor also identified 64 low- and medium-ranked applications that had hired registered lobbyists to lobby the minister or ministry before they were selected by the minister’s office.
“These applicants received approximately $126 million in funding,” she wrote.
According to the auditor, the labour minister’s office didn’t share “a documented reason” for why it chose the applicants it did for the first two years of the funding program, when over one-third of all recipients got grants.
From the third year on, the minister’s office’s documented reasons for its decisions “at times … conflicted with ministry staff’s evaluation of the selected applications,” Spence wrote.
Those rationales did not always address civil servants’ concerns, “or seem accurate,” she wrote.
Spence’s report points to one example of a low-ranked application that was funded, which was to train just one person for “a specific trade certification.”
While the ministry evaluator “noted a conflict of interest as the applicant was the one person intended to receive the training,” and ranked it low, the minister’s office funded it anyway.
“The project met all 12 of its KPIs, which related to the one individual receiving the training,” the auditor general reported.
The recipient is not identified in the report, nor are any others.
In another example, the minister’s office decided to give a group $4 million in funding — more than 95 per cent of recipients in that funding round received — despite the ministry ranking it “low” because it was recently formed, with no governing board, no experience managing public money, limited experience delivering employment training and “presented an inflated budget with no quotes provided for capital expenditures.”
“The project subsequently had compliance issues with its (transfer payment agreement) requirements, including missed targets, failing to meet on-site monitoring requirements, incomplete participant activity reports and late or missing project activity submissions,” the auditor found.
Ford’s Progressive Conservatives created the Skills Development Fund partway through their first mandate, with McNaughton, then the labour minister, launching it in February 2021.
The Ford government has since used its training stream, through which most of the program’s grants have been distributed, to fund projects preparing people for jobs or upskilling them.
Since 2021, the Skills Development Fund has become a pillar of the PCs’ agenda, with the premier telling reporters a couple of weeks ago that it’s “the best investment we’ve ever done in the province.”
The Ford government gave out $1.3 billion through the first five rounds of the program’s training-focused stream. McNaughton left the Ford government in September 2023, in between the third and fourth funding rounds. Ford appointed David Piccini as labour minister after McNaughton’s resignation.
Labour Ministry data included in the auditor general’s report shows that through the first four years of the program, recipients intended for 591,720 people to participate in programs they received funding for, later reporting that 675,991 had.
Other groups receiving Skills Development Fund grants with political connections that The Trillium has recently reported on include Pace Law, a firm run by the new Ford government-appointed chair of Metrolinx that received $3.3 million to train its staff, and King Animal Hospital, a high-end veterinary hospital founded by major PC donors, which received a $1.3 million Skills Development Fund grant.