Ontario not tracking whether business support dollars help, FAO finds

TORONTO _ Ontario’s fiscal watchdog says the Liberal government is not tracking whether the billions of dollars it has given to businesses through support programs is having any effect.

The Financial Accountability Office has issued a report saying the government pumped about $22.9 billion dollars into dozens of business support programs between 2012 and 2017.

The report examined 12 of the available programs, which help businesses through mechanisms such as tax credits, grants, loans or equity investments.

It found that most of the programs did not have guidelines in place to help track performance, and none had established measures to determine whether the government funds were helping the businesses achieve their goals.

The Liberals, who are weeks away from an election, defended their spending, saying it has resulted in new jobs and increased investment from private partners.

The FAO noted that several past provincial reports and advisors, including the Auditor General, have urged the government to gauge the direct impact of the funding it offered to businesses.

While its report studied only about 10 per cent of the more than 100 business support programs provided by the government, the FAO said it seems such calls have not been heeded.

“For all 12 business support programs, no attempt has been made by the province to isolate the impact of provincial support against what would have happened without provincial funding,” the report said.

“This means that the province has not attempted to determine if a company receiving a grant would have made the same project investment without the support, or a company investing in research and development would have still made the investment without the tax credit.”

The report also found the province did not establish control groups of businesses that did not benefit from the support programs to compare their performances with those that did.

The amount of spending on business support programs has stayed relatively static, rising from $4.5 billion in 2012-2013 to $4.9 billion in 2016-2017, the FAO said.

Economic Development Minister Steven Del Duca said the Liberals would look at the FAO report closely.

“We are always looking for ways to improve our programs, and we appreciate these recommendations,” Del Duca said.

The Progressive Conservatives, meanwhile, called for a “value-for-money audit” of the business support programs.

“There seems to be no tracking of dollars and no real understanding of whether these have worked or not,” said Tory parliamentary leader Vic Fedeli. “We’re talking about billions of dollars here that is basically unaccounted.”