Feds hurried to spend $50M social-finance cash, documents show

At the same time, federal officials continue to work on the design of the $755 million social-finance fund

Feds hurried to spend $50M social-finance cash, documents show

Internal government documents show that federal officials moved quickly before the fall election campaign to dole out $50 million aimed at transforming the delivery of social services.

The idea was to push money to national groups with a track record of success, and then raise awareness about the money itself with smaller groups the transformation effort is supposed to help.

A March briefing note to the minister in charge of the file said that officials would “strategically select projects” to fund “given the tight timelines” for announcements to start in June.

The approach would be faster than launching an open call for proposals, officials at Employment and Social Development Canada wrote in the document obtained by The Canadian Press through the Access to Information Act.

The money is part of a larger pot of spending that the Liberals want to give out in the coming years to social-services groups to help them partner with the private sector.

The idea is to give non-profits new sources of revenues, offer investors a way to make money while supporting social services, and possibly save federal cash in the long-run.

The Liberals have put some $800 million behind the social-finance initiative that has been the subject of behind-the-scenes debate since first announced just over a year ago.

The concept has cross-party support and groups working in the nascent sector are looking forward to seeing the final details of how the bulk of the money will be distributed, said Stephen Huddart, president and CEO of the McConnell Foundation.

The organizations using the $50 million to expand capacity — to prepare actual service providers to apply for and use the rest of the money — met in June and are scheduled to meet again in the coming weeks.

At the same time, federal officials continue to work on the design of the $755 million social-finance fund.

The idea is that payments from government would flow if a project — finding housing for people for whom current programs haven’t worked, for instance, or helping people kick drug addictions — has been shown successful through detailed data. But such a project would have to be funded in the beginning by private backers who take on the risk of failure.

The government has been told in meetings to seek three times the seed capital from private and philanthropic sources, which would amount to almost $2.3 billion on top of what’s coming from federal coffers.

The documents obtained by The Canadian Press also show the government was told to look for a return to its main social finance fund to make it sustainable, allowing the initial $755 million to be recycled over and over for new projects.

“While we support the idea that the government’s capital should be returned, I don’t think anyone would say that it’s more important to generate a financial return than it is to generate social impact, or environmental impact or to increase community capacity to solve and address complex problems,” Huddart said.

The documents don’t mention how much investors might receive in profits.

Officials have been told that the federal fund should shoulder some risk to help local funds, which would directly finance projects. Ottawa could take losses from any failed endeavours to help smaller funds attract private money by “virtually eliminating their exposure to risk.”

Other details of the government’s plan are yet to be released, including whether there will be knowledge hubs designed to help small groups learn and expand.

Sen. Ratna Omidvar, who has been a proponent of social finance in the upper chamber, said she expects these to be part of the plan.

“The field needs to be fertilized in a way so that the crops can grow,” she said.

“You can’t just simply push the money out the door without making sure that there is a higher bar on capacity, on understanding, how to service investments, how to capture data and evidence.”

She said the government needs to show patience, because success won’t be immediate. Omidvar also cautioned against fixating on financial returns to the federal fund as the measure of success.

“This is not for the short-term,” she said, pointing to experience in other countries.

“You have to have patience, you have to have determination. You have to obviously satisfy the political masters with interim indicators of success, but this is really a project for the longer term.”

Jordan Press, The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Orange shirts, shoes, flowers and messages are displayed on the steps outside the legislature in Victoria, B.C., on Tuesday, June 8, 2021 following a ceremony hosted by the Songhees and Esquimalt First Nations in honour of the 215 residential school children whose remains have been discovered buried near the facility in Kamloops, B.C. THE CANADIAN PRESS/Chad Hipolito
Alberta city cancels Canada Day fireworks at site of former residential school

City of St. Albert says that the are where the display was planned, is the site of the former Youville Residential School

FILE – Perry Bellegarde, National Chief of the Assembly of First Nations, takes part in an event on Parliament Hill in Ottawa on Tuesday, July 7, 2020. THE CANADIAN PRESS/Sean Kilpatrick
Indigenous Peoples Day must be a ‘call to action’, says Assembly of First Nations chief

Discovery of children at Kamloops residential school site must lead to change, Perry Bellegarde says

The Government of Alberta identified 115 new COVID-19 cases Sunday, bringing the provincial total to 3,089.
(Black Press file photo)
Alberta reports 100 new cases of COVID-19

The Central zone sits at 218 active cases

The Government of Alberta identified 115 new COVID-19 cases Sunday, bringing the provincial total to 3,089.
(Black Press file photo)
Red Deer drops to 71 active cases of COVID-19

Province adds 127 new cases of the virus

Police officers and their dogs undergo training at the RCMP Police Dog Services training centre in Innisfail, Alta., on Wednesday, July 15, 2015. Mounties say they are searching for an armed and dangerous man near a provincial park in northern Alberta who is believed to have shot and killed a service dog during a police chase. THE CANADIAN PRESS/Jeff McIntosh
RCMP search for armed man in northern Alberta after police dog shot and killed

Cpl. Deanna Fontaine says a police service dog named Jago was shot during the pursuit

Marco Mendicino, Minister of Immigration, Refugees and Citizenship during a press conference in Ottawa on Thursday, May 13, 2021. THE CANADIAN PRESS/Sean Kilpatrick
Canada to welcome 45,000 refugees this year, says immigration minister

Canada plans to increase persons admitted from 23,500 to 45,000 and expedite permanent residency applications

Tl’etinqox-lead ceremony at the site of the former St. Joseph’s Mission in Williams Lake, B.C., June 18, 2021. (Angie Mindus photo - Williams Lake Tribune)
‘We are all one people’: Honouring residential school victims and survivors

Love, support and curiousity: Canadians urged to learn about residential schools and their impact

Indigenous rights and climate activists gathered outside Liberty Mutual’s office in Vancouver to pressure the insurance giant to stop covering Trans Mountain. (Photo by Andrew Larigakis)
Activists work to ensure Trans Mountain won’t get insurance

Global campaign urging insurance providers to stay away from Canadian pipeline project

Investigators use a bucket to help recover human remains at a home burned in the Camp fire, Thursday, Nov. 15, 2018, in Magalia, Calif. Many of the missing in the deadly Northern California wildfire are elderly residents in Magalia, a forested town of about 11,000 north of the destroyed town of Paradise. (AP Photo/John Locher)
‘Forever War’ with fire has California battling forests instead

Five of the state’s largest-ever blazes seared California last year, as authorities tackle prevention

Tokyo 2020 President Seiko Hashimoto and IOC President Thomas Bach, on a screen, speak during a five=party online meeting at Harumi Island Triton Square Tower Y in Tokyo Monday, June 21, 2021. The Tokyo Olympics will allow some local fans to attend when the games open in just over a month, Tokyo organizing committee officials and the IOC said on Monday. (Rodrigo Reyes Marin/Pool Photo via AP)
Tokyo Olympics to allow Japanese fans only, with strict limits

Organizers set a limit of 50% capacity — up to a maximum of 10,000 fans

Intricate cloth masks with Indigenous design made by Teresa Snow. Facebook/ Masks4Maskwacis
‘Masks 4 Maskwacis’ wins Northern Lights Volunteer Award

The group received recognition for their efforts to support their community during COVID-19.

The border crossing into the United States is seen during the COVID-19 pandemic in Lacolle, Que. on February 12, 2021. THE CANADIAN PRESS/Paul Chiasson
VIDEO: Border quarantine to soon lift for fully vaccinated Canadians

Eligible travellers must still take multiple COVID-19 tests

Blair Lebsack, owner of RGE RD restaurant, poses for a portrait in the dining room, in Edmonton, Friday, June 18, 2021. Canadian restaurants are having to find ways to deal with the rising cost of food. THE CANADIAN PRESS/Jason Franson
Canadian restaurateurs grapple with rising food costs, menu prices expected to rise

Restaurants are a low margin industry, so there’s not a lot of room to work in additional costs

Most Read