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.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

B.C's COVID-19 dashboard shows the peaks and valleys of cases prior to the record daily report of 132 on April 9, 2021. (Dashboard image)
Interior Health has record day of COVID-19 cases

132 cases reported Friday, April 9, more deaths in Vernon hospital outbreak

School District 83 trustees are leaning towards an option in the school district’s Long Range Facilities Plan that favours making Salmon Arm Secondary’s Sullivan campus and Jackson campus (pictured) both Grade 9-12 schools. (Google maps image)
Letter: Two high school option for Salmon Arm will create ‘have, have not’ situation

Writer concerned with E5 option, says transparent talk about implications needed

Left, Elena Bruns (2015 Rapattack Junior recruit/current Rapattack staff) and Leah Nash (2019 Rapattack Junior recruit/current Rapattack staff) in a helicopter on the Eagle Bluff Fire, August 2019. (Kamloops Fire Centre photo)
Salmon Arm students stick with wildfire fighting after junior Rapattack program

Junior Fire Crew program partners with Salmon Arm Secondary, develops students’ love for job

Work began April 6, 2021 on the Trans-Canada Highway downtown corridor project to improve safety and traffic flow, which will see the traffic light at Ross Street relocated to Fourth Street NE. (Martha Wickett - Salmon Arm Observer)
VIDEO: Traffic slow downs to go through May on Salmon Arm highway corridor

Ministry says night work not planned on Highway 1, single lanes to remain as traffic light changed

B.C. Health Minister Adrian Dix and Premier John Horgan describe vaccine rollout at the legislature, March 29, 2021. (B.C. government)
1,262 more COVID-19 infections in B.C. Friday, 9,574 active cases

Province’s mass vaccination reaches one million people

Vernon Secondary School. (Google Maps)
Case of COVID-19 at North Okanagan high school

VSS exposure announced late Friday, April 9

Librarian Katie Burns with the Fraser Valley Regional Libraries poses for a photo in Chilliwack on June 18, 2019. Monday, April 12, 2021 is Library Workers’ Day. (Jenna Hauck/ Chilliwack Progress file)
Unofficial holidays: Here’s what people are celebrating for the week of April 11 to 17

Library Workers Day, That Sucks! Day, and Wear Your Pyjamas to Work Day are all coming up this week

The Royal’s 1951 visit to Revelstoke. (Photo by Revelstoke Museum and Archives #17)
PHOTOS: Prince Philip visited Revelstoke – twice

The prince died April 9 at the age of 99

Nolan's Pharmasave in downtown Vernon received 200 AstraZeneca COVID-19 vaccines Friday, April 9, 2021. (Brendan Shykora - Morning Star)
AstraZeneca vaccines arrive at Vernon pharmacies

Four pharmacies in the city received doses of the COVID-19 inoculant Friday

The RCMP were called to the Alchemy Studio on Thursday, April 8. (Contributed)
Revelstoke yoga class fined for defying COVID-19 orders

The RCMP were called to the Alchemy Studio on April 8

An East Hill resident had their leaf bags torched in front of their home overnight April 8. Less than two weeks prior their garbage can was lit on fire too. (Taryn Allen photo)
Garbage, leaf fires spark fear in North Okanagan

First an East Hill residents’ trash can, then bagged leaves were lit on fire

Okanagan-based All Are Family Outreach Society, which provides support to those struggling from Armstrong to Kelowna, is in need of a new headquarters after leaving a Winfield church in June 2020. (All Are Family Outreach photo)
Okanagan outreach society in ‘desperate’ need after storage unit break-in

All Are Family Outreach had $4,000 in tools stolen from its donation shipping container

Most Read