Provinces see ‘positive shift’ in Ottawa's new jobs grant offer

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Ottawa and the provinces are inching toward a deal on the Canada Job Grant as provincial labour ministers plan to talk Friday about the latest offer from the federal government.

British Columbia and New Brunswick are working to corral the provinces into a common position and New Brunswick Premier David Alward signalled Wednesday that Ottawa's latest offer has changed the dynamic.

"I think there has been a positive shift in, I'll say, atmosphere in terms of the desire to find a solution that we believe ultimately will work well for Canadians," he said, at an event in Fredericton with federal Employment Minister Jason Kenney to announce the harmonization of federal and provincial apprenticeship programs in Atlantic Canada.

Provinces have pushed back against the cost of Ottawa's original plan, which caught them off guard when it was first announced in the 2013 federal budget. Ottawa has insisted a new national approach to training is needed, as businesses continue to warn of skills shortages during a time of rising unemployment. Governments also face public concern over the widespread use of temporary foreign workers by employers who say they can't find the skilled workers they need in Canada.

Mr. Alward's view was echoed by Ontario Premier Kathleen Wynne, who has been among the most vocal critics of the grant as it was initially proposed in the 2013 federal budget.

"I'm pleased that the federal government has seen that there needed to be some changes to the Canada Job Grant," she said in Toronto on Wednesday. "I look forward to a good outcome. I think there are still some issues that need to be discussed, but I'm glad that we're seeing some movement."

The comments from the two premiers are the first high-level public responses from the provinces since Mr. Kenney delivered a detailed new proposal on Christmas Eve.

Mr. Kenney confirmed Wednesday that he has waived a key requirement that provinces contribute toward the job grants, which will be worth up to $15,000, to pay for skills training. The Globe and Mail reported Wednesday morning that Ottawa has offered to waive a requirement that the cost of each grant be split evenly among Ottawa, a province and a business looking to hire. Instead, Ottawa will fund up to $10,000 per grant, with up to an additional $5,000 coming from a business.

Ottawa is not offering more money over all, meaning the number of grants offered per year will be considerably lower than the original target of 130,000. Ottawa is also still planning to gradually reduce annual provincial transfers for training by $300-million to pay for the federal share of the grants. The requirement to also match federal contributions – which has now been waived – was estimated to cost the provinces an additional $300-million.

"The provinces have said to us that they are understandably in very tough fiscal circumstances," said Mr. Kenney in Fredericton. "They don't have a lot of new money for new projects and so they made it clear that they would not be in a position to match the federal contribution toward that. I completely understand that and I've accepted that in our revised offer. I don't want to go too much into detail though because we are having the discussions and we don't want to do that in the media."

Mr. Kenney may still need to offer more changes to get a deal. Manitoba Jobs and Economy Minister Theresa Oswald said in a statement to The Globe Wednesday that "more flexibility is needed" beyond Mr. Kenney's latest plan.

While provinces appear to be happy with Ottawa's latest move, reaction from business groups that support the grant is mixed. Employer groups are generally pleased talks are still alive but disappointed that provinces won't be contributing toward the grant.

"It's unfortunate," said Jayson Myers, president and CEO of the Canadian Manufacturers and Exporters. "We would have certainly liked to have seen the provinces participate with matching funds."

David Lindsay, CEO of the Forest Products Association of Canada, said companies are uneasy at how long it is taking to get a deal.

"I hope the provinces and the feds can work out any differences that they have and just get on with it," he said.

Craig Martin, vice-president of public safety with the Canadian Welding Bureau, said it's encouraging that the talks continue.

"The number-one concern of our membership is a shortage of skilled trades," he said, noting that the average welder in Canada is 56 and approaching retirement. "We support a more national focus on dealing with our skilled trades issues."

With a report from Adrian Morrow in Toronto