Report - Region of Peel

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REPORT
Meeting Date: March 27, 2014
Regional Council
For Information
DATE:
March 3, 2014
REPORT TITLE: THE CANADA JOB GRANT
FROM:
Janet Menard, Commissioner of Human Services
OBJECTIVE
To provide information on the Canada Job Grant, as referred to Human Services through
Council Resolution 2014-57.
REPORT HIGHLIGHTS
• In its 2013 Budget, the Canadian government announced the Canada Job Grant, as part
of the renewal of Labour Market Agreements (LMAs), set to expire in March 2014.
• Through LMAs, which were introduced in 2007, the federal government has provided
$500 million annually (in total) to provinces in support of employment and training
programs.
• Through these funds, the Province of Ontario, in collaboration with municipalities and a
network of agencies, delivers a range of programs that target different clients (e.g.,
unemployed, underemployed, job seekers, and employers).
• Initially, the federal government announced to fund the Canada Job Grant largely ($300
million per annum) from the annual $500 million LMA funding distributed to the provinces.
• If funded through the Labour Market Agreements, the Canada Job Grant will redirect $116
million from funding currently supporting Ontarians who are not eligible for Employment
Insurance.
• Ontario and other provinces and territories raised concerns that transferring LMA funds
largely to the Canada Job Grant will significantly impact existing employment and training
programs and the network serving the community.
• The federal government has announced flexibility in the way the grant is funded and
delayed the start date by three months to July 1, 2014.
DISCUSSION
1. Background
In 2007, the federal government introduced Labour Market Agreements (LMAs). These
agreements have allowed funds to flow from the federal government to the provinces to
address local labour market needs through the provision of appropriate programs and
services. Based on these funding supports, the Ontario government and other provinces
deliver employment and training programs designed to address diverse labour market
needs.
V-01-002 2013/09
March 3, 2014
THE CANADA JOB GRANT
In its 2013 Budget, the federal government announced the Canada Job Grant, as part of the
renewal of LMAs, set to expire in March 2014. The initial announcement of the Grant
indicated a shift in the way LMA funds are controlled and distributed in relation to
employment and training supports. The federal government announced to fund the Canada
Job Grant largely ($300 million per annum) from the annual $500 million LMA funding
distributed to the provinces.
Although the Canada Job Grant aims to address labour market needs by upgrading skills of
employees, provinces and territories across Canada expressed that this "one size fits all"
approach would undermine their ability to deliver programs which address varying local
needs. Also, transferring the LMA funds largely to the Canada Job Grant would impact
employment services and programs serving the most vulnerable population groups.
Provinces and territories have held on-going discussions regarding the impact of the
Canada Job Grant and identified their concerns to the federal government (Appendix 1).
Modifications to the Canada Job Grant have been made following subsequent negotiations.
Most recently, the federal government announced flexibility in the way the grant is funded,
making it open to the provinces to select which funds can be used to support the grant. All
provinces and territories, except for Quebec, have "agreed in principle" to the latest offer
from the federal government.
2. Labour Market Agreements (LMA) and Outcomes
a) Overview of LMAs
Through LMAs, the federal government made an investment of $3 billion over six years
to assist Canadians (who are low-skilled or not eligible for Employment Insurance (EI)
benefits) with training and employment supports. Through the last Canada-Ontario LMA,
the federal government made a commitment to provide Ontario with $1.2 billion over six
years. The Ontario government allocated these funds in four priority areas: technical
skills training; labour market integration of immigrants; foundation skills training and
supports; and labour market supports for persons with disabilities.
Since 2008, the Province of Ontario, in collaboration with municipalities and a network of
agencies, has developed new programs and integrated services in support of these four
priority areas. For example, Employment Ontario (EO) provides basic literacy and skills
training, education programs, placements, training for working in trade or new highdemand career, labour market needs assessments for employers, and more.
b) Outcomes of LMAs in Canada and Peel
Employment initiatives funded by LMAs have helped tens of thousands of unemployed
Canadians find employment. According to a joint evaluation by the federal and provincial
governments, clients who participated in such programs doubled their chances of
obtaining and keeping employment.
To better understand the local impacts of LMA programs, a recent Peei-Halton Labour
Market report identified that in the 2012-2013 fiscal year, over 18,000 clients participated
in employment services/programs in Peel and Halton regions. Training and education
programs offered through employment services include: Second Career, English/French
as a Second Language (ESL!FSL), post-secondary education, literacy training, Ministry
of Citizenship and Immigration (MCI) Bridge Training program, and Apprenticeship
programs.
V.01-002 2013/11
March 3, 2014
THE CANADA JOB GRANT
It should be noted that 64 per cent of employment services clients secured employment
in 2012-2013 and 59 per cent of these individuals obtained full-time jobs.
3. The Canada Job Grant and its Implications
a) Overview
The Canada Job Grant targets individuals who are seeking training, and businesses that
have a plan to train unemployed and underemployed Canadians for an existing job or a
better job.
The initial announcement of the Grant identified a $5,000 contribution from each of the
following partners: the federal government, provincial and territorial governments, and
employers. Provinces and territories unanimously raised concerns and the federal
government subsequently waived the requirement for provinces and territories to match
the funds and raised the federal contribution to $10,000, without changing the overall
budget for this grant.
As such, the Canada Job Grant would provide $15,000 per worker towards training, with
up to a maximum $10,000 federal contribution and the rest from employers. Initially, the
federal government announced an April 1, 2014 start date. This commitment was
reiterated in the 2014 federal budget. Following recent negotiations with the provinces
and territories, the federal government agreed to delay the start date to July 1, 2014.
b) Response from Canadian Provinces and Territories
Since the announcement of the Grant, provinces and territories have held discussions
regarding the impact of the Canada Job Grant, highlighting the following key concerns:
•
•
•
•
•
The Canada Job Grant, if funded ($300 million per annum) from the annual $500
million Labour Market Agreement funding, will directly impact existing
employment and training programs that serve vulnerable workers.
The great majority of small and medium-sized businesses would be unable to
participate because of the need for them to make a financial contribution.
The flexibility to tailor programs within each province and territory, a key strength
of current LMAs, will be lost.
The grant will not result in new investments in training; rather the federal funding
will offset current employer contributions to funding.
There is no evidence to show that the Canada Job Grant will result in intended
outcomes.
c) Recent Developments
Outlining the above noted key concerns with the Canada Job Grant, the provinces and
territories held discussions with the federal government and provided a counter proposal
to the initial grant. Recent negotiations between the federal and the provincial and
territorial governments have yielded the following developments:
•
V-01-002 2013/11
Grant Funding: In the counter proposal, the provinces recommended local
flexibility around where the grant is funded, including Labour Market Agreements,
Labour Market Development Agreements (LMDAs), and other sources of
revenue, including their own. The federal government has agreed with this
request by allowing that the $300 million transfer of funds could come from other
March 3, 2014
THE CANADA JOB GRANT
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sources, such as a larger $1.95 billion annual training funds through LMDAs or
other sources of revenues.
•
Timeline and Phasing: The provinces requested the start date for the Canada
Job Grant should be pushed back to Oct. 1, instead of April 1, and should be
gradually phased in over a period of six years instead of four. The federal
government agreed to move the implementation date for the Grant from April 1 to
July 1, 2014, while declared to keep the phasing-in of the Grant to four years.
An "agreement in principle" on the Canada Job Grant was reached between the federal
government and the provinces (except Quebec) and territories, and announced on
February 28, 2014. The timing of this announcement is important because it comes
ahead of labour market negotiations.
d) Implications of the Canada Job Grant for Ontario and Peel
While the federal government has agreed to a number of changes to the proposed grant,
there remain some outstanding issues. Although the recent developments appear
promising in terms of more flexibility to the provinces, the potential changes to funding
shifts, depending on how the Ontario government chooses to fund the grant, could still
impact the continuation of provincial programs and supports, funded either through
LMAs, LMDAs, and other sources. The total Canada Job Grant for Ontario is $116
million. Existing federal funding for the LMA and LMDA is $193 million and $680 million
respectively, totalling $873 million. Overall, there will be $116 million less in federal
funding available for existing skills and training programs for the most vulnerable and
unemployed.
The grant may not be flexible enough to allow some employers, especially small and
medium sized businesses, to participate. If businesses are not able to use the Canada
Job Grant, funding that would otherwise be going to organizations that provide
employment supports to vulnerable Canadians would be lost.
The Region of Peel, as part of a network of service providers, has implemented a variety
of programs through the funds from the previous Canada-Ontario LMA. Ontario Works in
Peel provides clients with short-term financial assistance, along with a variety of services
and programs to assist them in obtaining employment and increasing independence.
These programs and Peel's role in supporting such programs are under review and will
be the subject of a future discussion at Council.
In the meantime, the impacts of this program are significant when one considers the
local economic context. In 2013, the unemployment rate in Peel was 9.1 per cent. For
youth (aged 15-24 years), the unemployment rate was even higher at 20 per cent. High
youth unemployment indicates that rigorous efforts from all levels of government are
needed to ensure that youth have the foundational skills to build their future and
contribute to the economic growth of our region and country.
V..Q1-o02 2013[11
March 3, 2014
THE CANADA JOB GRANT
FINANCIAL IMPLICATIONS
The Canada Job Grant will affect the funding for LMAs and LMDAs as discussed. As such,
there will be impacts on the overall funding allocation the Province receives as transfers from
the federal government, including funds for employment and training programs. This could
subsequently impact the funding for such programs delivered in Peel Region.
CONCLUSION
The Region of Peel, as one of several service providers, has implemented a variety of programs
through the funds from the previous Canada-Ontario LMA. Although the recent developments
and "agreement in principle" appear promising, these changes could still impact the continuation
of provincial programs and supports, funded through LMAs and LMDAs. The renegotiation of
LMAs must preserve the provinces' and local municipalities' ability to deliver a wide range of
employment and training programs, to meet local labour market needs. Staff will continue to
monitor the development of the renewal of Canada-Ontario LMA and report back to Council, as
appropriate.
Janet Menard
Commissioner of Human Services
Approved for Submission:
D. Szwarc, Chief Administrative Officer
For further information regarding this report, please contact Juliet Jackson at extension 6741 or
via email at [email protected].
Authored By:
c.
Archana Vyas and Junior Higgins
Legislative Services
V-QHl02 2013/11
APPENDIX I
March 3, 2014
THE CANADA JOB GRANT
Ministry of Training,
Colleges and Universities
Mlnistere de Ia Fonnation
et des Colleges et Universites
Minister
Ministra
Mowat Block
Queen's Park
Toronto ON M7A 1L2
Edifice Mowat
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Queen's Park
Toronto ON M7A 11.2
Ontario
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December 9, 2013
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Mr. Emil Kolb
Chair
Peel Region
10 Peel Centre Drive Suite A, Room 504
Brampton ON L6T 4B9
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Dear Chair Kolb,
I am writing to update you on Ontario's dealings with the federal government on a renewed Labour
Market Agreement.
The federal government is preparing to renegotiate the Labour Market Agreements with each
province, and has proposed a Canada Job Grant to direct future skills training in Canada.
In September, I discussed our approach to these negotiations with municipal leaders at a standing
meeting with the Association of Municipalities of Ontario. I also met with my provincial and
territorial colleagues at the Forum of Labour Market Ministers.
Based on our shared views, all ofCanada's provinces and territories have released a report, "Building
SkillS" Together," which· outlines our success-helping people facing barriers to work. Municipalities ·have an important role to play in delivering employment and training programming and are critical to
supporting the employment success outlined in this report.
A copy of this report is included with this letter. It is also available online at
http://www.tcu.gov.on.caJeng!labounnarket/BuiJdSkills.html. I encourage you to share the report
with your council members and residents.
On November 8, 2013, my provincial-territorial counterparts and I met with Jason Kenney, Canada's
Minister of Employment and Social Development. Much of our conversation focused on the
renegotiation of the Labour Market Agreements and the proposed Canada Job Grant. Provinces and
territories stood together advocating for new Labour Market Agreements that meet the needs of our
jobseekers and employers. Ensuring that aU of Ontario •s job seekers have the opportunit;y to
participate in the labour force remains a priority for me and Premier Wynne. This is why I made it
very clear to Minister Kenney that any renegotiation of a Labour Market Agreement must preserve
and broaden our ability to deliver a wide range of employment and training programs, particularly
those that link training to labour market demand.
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DIRECTIUl\ Pit:OUH~ED - - - -- - RECEIP'1 HECOMM ENDED -~~---
APPENDIX I
March 3, 2014
THE CANADA JOB GRANT
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We need our training programs to continue to meet the unique needs of our province•s regions,
businesses and people- including youth. newcomers, Aboriginal people, long-tenn unemployed and
people with disabilities.
Throughout the meeting, my counterparts and I remained steadfast in agreement that we cannot
support any program that is funded on the backs of our most vulnerable workers, such as the current
Canada Job Grant proposal. Simply put, this grant will place the Employment Ontario network and
the province's successful employment services and training programs at risk.
Canada's premiers reaffirmed this message when they met for the Council of the Federation on
November 15 in Toronto and discussed these important negotiations. Every premier agreed that
provinces and territories cannot move forward with the Canada Job Grant as proposed. They have
asked provincial-territorial ministers to develop an alternative proposal to present to Minister
Kenney.
This work is moving very quickly. This aJtemate proposal is going to be based on the feedback we
have received from stakeholders, including municipalities.
As we continue to talk with the federal government, I need your help to spread the message about the
impact that the federal proposal could have on our ability to help vulnerable workers.
If you have not already done so, I also urge you to write to your federal Member of Parliament and
your Member of Provincial Parliament to tell them how the federal government's proposals would
impact you and your communities. Your input can help us negotiate a workable agreement for
Ontario.
Included with this letter is a fact sheet on Ontario Employment and Training Programs to show how
we allocate funding-and how programs could be affected by the federal government's proposal. You
can also share your thoughts on these proposed changes at with us directly [email protected].
Sincerely,
R-Pp_
Brad Duguid
Minister
APPENDIX I
March 3, 2014
THE CANADA JOB GRANT
ONTARIO EMPLOYMENT AND TRAINING PROGRAMS
AND FEDERAL-PROVINCIAL FUNDING ARRANGEMENTS
Ontario delivers employment and training programs designed to address the diverse labour market
needs of the province.
This includes programs delivered through Employment Ontario such as Second Career, Literacy
and Basic Skills, and the Employment Service that help unemployed workers upgrade their skills
and find jobs.
It also includes specialized services funded by various Ontario ministries for vulnerable workers
such as immigrants, Aboriginal peoples, social assistance recipients, persons with disabilities, and
others who need additional support.
Some of these programs are currently paid for, in whole or in part, through the following federal
funding agreements:
•
•
•
•
Labour Market Agreement (LMA) for clients not eligible for Employment Insurance;
Labour Market Development Agreement (LMDA) primarily for clients eligible for Employment
Insurance;
Labour Market Agreement for Persons with Disabilities (LMAPD); and
Targeted Initiative for Older Workers (TIOW).
TheLMA. LMAPD, and TIOW are set to expire on March 31, 2014
Based on statements in the 2013 Federal Budget, a Canada Job Grant would largely
replace the LMA and cut $232M annually from existing programs.
Current Source of Funding for Ontario
Labour Market Programs~ 2012~13
Potential Impact of Proposed
Canada Job Grant
$232M
OfrtHida
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LMAP0$9.3M
$76.4M
\ >~TIOW
lMAPD $9.3M
$76.4M
APPENDIX I
March 3, 2014
THE CANADA JOB GRANT
If LMA funds are redirected to the Canada Job Grant, the following programs are most at risk of
seeing cuts:
•
Employment Benefits for Persons with Disabilities through the Ontario Disability Support Program
•
Employment Assistance and Employment & Participation Benefits through Ontario Works
•
Apprenticeship Training
•
Second Career
•
Employment Services offered through Employment Ontario, such as free personalized counselling
to find work, advice on further training and education, and incentives for employers to hire and train workers
•
Literacy and Basic Skills
•
Programs for immigrants, including Bridge Training and Language Training
•
Summer job programming for youth
THE 2013 FEDERAL BUDGET ALSO ANNOUNCED PlANS TO RESHAPE THE LMAPD AND lMDAOTHER PROGRAMS AT RISK:
Labour Market Agreement for Persons with Disabilities (LMAPD) supports:
•
Employment and Income Supports through the Ontario Disability Support Program
•
Addiction supports that help prepare individuals for employment through Ontario Works
•
Community Participation Supports
•
Community mental health programming
•
Accessibility supports for postsecondary education students with disabilities
Labour Market Development Agreement (LMDA) provides funding primarily for clients who are
eligible for Employment Insurance:
• Employment Services offered through Employment Ontario, such as free personalized help to find work,
advice on further training and education, and incentives for employers to hire and train clients
• Second Career
• Apprenticeship Programming
• Other programs, including Job Creation Partnerships, Self-Employment Benefit, and Labou r Market
Partnerships
THE PROPOSED CANADA JOB GRANT WOULD NOT HELP UNEMPLOYED WORKERS
• People must either be working or would have to find an employer to be.eligible for support through
a Canada Job Grant. This would leave many unemployed Ontarians without access to training.
IMPACTS OF THE CANADA JOB GRANT ON WORKERS AND BUSINESSES IN ONTARIO
• Employers would be required to contribute cash to cost-match the Grant (in-kind contributions would
not be eligible). Some small businesses would be able to claim a portion of their trainee wage costs as
a part of their contribution. No other in-kind contributions would be eligible.
• The grant would primarily support direct costs of training. Only Employment Insurance-eligible clients
could receive additional financial supports. This would not provide the daycare, transportation or
other indirect training supports that help many vulnerable workers access training.
• Training would have to be provided by community colleges, career colleges, or a union training
centre (not employers).
• Ontario would not be able to use the funding to design programs that address its own labour market
needs.

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