The Québec Ombudsman received a disclosure concerning the authorities of a government department who supposedly had favoured not-for-profit organizations in awarding subsidies. The subsidy program in question manages a budget of nearly $60 million. This budget makes it possible to support the Department’s partner organizations in carrying out projects consistent with the Department’s mission.
The Québec Ombudsman decided to investigate to see whether wrongdoing had occurred.
"Our investigation was about the administrative operation of the subsidy program, including managing the interface between Ministère de l’Éducation authorities and the political office. All our findings and recommendations are addressed to the Ministère de l'Éducation. Our conclusion that wrongdoing did indeed occur is about the Ministère de l’Éducation and not about specific people. Even though the disclosure was received in February 2018, the investigation spanned several years (until November 2021). In recent months, we have had discussions with the Ministère de l’Éducation to ensure that our recommendations are being implemented," declared Québec Ombudsman Marc-André Dowd. Clarifications concerning this investigation conclusion
Findings
The program is administrative and discretionary. The budget is not contingent on any objective parameters, criteria or indicators for establishing an organization’s eligibility. The administrative apparatus handles, analyzes and follows up on applications. The Minister has the discretionary power to accept or refuse the analysts’ recommendation to grant or not to grant a subsidy.
The investigation revealed several irregularities in the management of the budget. Moreover, objectionable practices were repeatedly used.
1. The discretionary power to grant subsidies was exercised unfairly. In several cases, certain organizations were truly given preferential treatment.
2. The political authorities had impinged on the roles of the administrative apparatus to influence decisions about awarding financial assistance. As a result, some organizations had been unjustly favoured:
- Close ties existed between the office and certain organizations. This meant that decisions were made upstream by the office to the detriment of the administrative processing of the application.
- Certain recommendations to the Minister to not grant subsidies were changed to become positive recommendations.
- The office asked that the files of certain organizations be fast-tracked to grant them funding rapidly.
3. The Department’s senior officials had not attended to the sound management of the public funds for the program:
- Financial assistance was awarded to organizations that had not formally submitted a project or applied.
- The wrong financial vehicle (subsidy instead of a contract and vice-versa) was regularly used.
The Department’s version
The Department says that it acted with total transparency with its staff and respected their analytical role. However, it acknowledged the close ties of certain organizations with the Minister’s office.
Conclusion
The Québec Ombudsman concluded that there were severe breaches in terms of the behaviour expected from authorities. Some of the criticisms concerned:
- Unfair treatment favouring certain applicants;
- The failure of various players regarding their obligation to ensure sound management of the political-administrative interface;
- Staff demoralization caused by the adoption of unfair practices.
The practices constituted gross mismanagement—a wrongdoing within the meaning of the Act to facilitate the disclosure of wrongdoings relating to public bodies.
Recommendations
The Québec Ombudsman made nine recommendations to the Department aimed at:
- Strengthening the integrity of the political-administrative interface;
- Seeing to the impartiality of the processes leading to the awarding of financial assistance;
- Reaffirming clear directives and rules of conduct for its administrative and political staff;
- Better equipping its staff for selecting financial vehicles (subsidy or contract).
Further to these recommendations, the Department produced a comprehensive action plan. So far, more than half of the recommendations have been implemented. The Québec Ombudsman is monitoring the implementation of the remaining recommendations.
