Employment Minister Jason Kenney has made more key concessions on the Canada Job Grant in an effort to finally reach a deal, allowing the provinces more flexibility in deciding how money is budgeted to pay for the grant.

The proposed grant was first announced in the March federal budget and has been the subject of intense negotiations with the provinces since then. Mr. Kenney has said the government would be flexible in implementing the grant and has made some previous concessions, but the latest offer is described as “final” in a letter to the provinces.

The federal Conservative government has said that matching Canada’s unemployed and underemployed with available jobs is a top priority that the job grant is meant to help address. As employment minister, it’s Mr. Kenney’s job to break the impasse.

Provinces reacted positively Friday to the development but said they need time to review the details.

Ottawa expects the provinces to manage the grant and originally insisted they pay for the program using $300-million of a $500-million transfer they currently use to train vulnerable workers, including immigrants, youth, older employees and the disabled. Provinces objected to this requirement and proposed they be allowed to find the $300-million from other sources – such as a larger $2-billion training transfer called Labour Market Development Agreements – or from their own revenues. Ottawa has agreed to this suggestion, according to a source who has seen the letter.

Provinces had also requested launch of the job grant be delayed from April 1 to Oct. 1, 2014. Mr. Kenney has responded by saying the grant will start July 1.

Allen Roach, co-chair of the Forum of Labour Market Ministers and Prince Edward Island’s Minister of Innovation and Advanced Learning, issued a statement that reacted positively to Mr. Kenney’s letter. He said he looks forward to discussing the offer with his provincial and territorial colleagues. “I want to thank Minister Kenney for his ongoing engagement and collaboration on this file,” he said.

Shirley Bond, B.C.’s Minister of Jobs, Tourism and Skills Training, told The Globe she’s “cautiously optimistic” after reviewing the letter and talking by phone with Mr. Kenney. “This is a complex file so I don’t want to speculate on where we might end up on this, but glad to have received the response,” she said.

Ontario’s Minister of Training, Colleges and Universities, Brad Duguid, issued a neutral statement. “We are currently reviewing the offer and doing our due diligence to understand the implications that it would have on the employment and training programs that serve our most marginalized and vulnerable workers,” he said.

The letter was sent Friday to all provinces except Quebec. Quebec has refused to participate from the moment the proposal was first announced. The Quebec government is requesting full compensation to run its own programs. Talks between Ottawa and Quebec on the issue have continued independently, and Mr. Kenney has not said how Ottawa intends to respond to Quebec’s requests.

Mr. Kenney’s letter also formalizes a concession that he has previously stated publicly – that provinces are no longer being asked to provide matching funds toward the grants. As originally envisioned in the 2013 budget, each grant would provide up to $15,000 toward training for a specific job. The budget said the cost would be split three ways among Ottawa, a province and a business. Mr. Kenney has since waived the provincial requirement. Ottawa will now cover two-thirds of each grant, but as a result of the change, will be able to afford fewer grants.

“The federal government has significantly restructured its proposal based on provincial feedback,” said Mr. Kenney’s spokesperson Alexandra Fortier in an e-mail. “We are hopeful that an agreement can be reached on the Canada Job Grant.”

Provinces have criticized the job grant as a unilateral move into provincial jurisdiction that is not supported by evidence. Many business groups have praised the idea as a potential improvement on the status quo.

OTTAWA — The Globe and Mail
Published Friday, Feb. 21 2014, 1:07 PM EST
Last updated Friday, Feb. 21 2014, 11:50 PM EST