Provincial labour ministers will send a counter-proposal to the federal government in the coming days aimed at supporting a new Canada Job Grant while preserving training programs for vulnerable Canadians.
After a Tuesday meeting by phone, labour ministers agreed on the details of a counter-proposal that is expected to be sent to federal Employment Minister Jason Kenney.
In an interview, Ontario Minister of Training, Colleges and Universities Brad Duguid said the provinces accept that they will see a cut of roughly $300-million in transfer payments from Ottawa, but they want changes in terms of which transfers are reduced.
Since Ottawa announced its Canada Job Grant plans in the 2013 budget, the provinces have objected to the fact that Ottawa planned to pay for its share of the training grants by cutting $300-million of a $500-million-a-year transfer for Labour Market Agreements, which fund training for vulnerable workers who do not qualify for employment insurance, including aboriginal people, people with disabilities, immigrants, youth and older workers.
Mr. Duguid said provinces should have a say on which transfers are cut, suggesting a preference that they come from a roughly $2-billion-a-year fund called Labour Market Development Agreements that help train people who do qualify for EI.
"The key is from day one, our objection has always been that they're insisting that the money be funded from the LMA program," he said. "While they've moved a little bit from that and allowed us to find some other sources of funding, the bulk of the funding is still coming from that LMA program and that's on the backs of our marginalized, out-of-work Canadians, and that's the piece that provinces and territories simply cannot accept."
Mr. Duguid declined to provide a detailed explanation of the provincial proposal, which he described as "inherently reasonable."
Nick Koolsbergen, a spokesman for Mr. Kenney, said Ottawa has not yet received the counter-proposal.
"The federal government has listened to provinces' concerns and significantly restructured the offer based on their feedback," he wrote in an e-mail. "We are hopeful that an agreement can be reached on the Canada Job Grant, to ensure skills training actually leads to a guaranteed job and employers are putting more money into equipping Canadians for available jobs."
Ottawa wants the program to begin on April 1.
The federal government has already proposed two significant changes from its original plan. As it was first announced, the Canada Job Grant would offer up to $15,000 for individuals who want to receive training for a specific job. Ottawa wanted the cost to be split three ways between Ottawa, a province and a business looking to hire.
Because Ottawa plans to pay for its share of the grants by reducing provincial transfers, it effectively meant that provinces would lose $300-million in transfers and were being asked to find an additional $300-million to contribute toward the grants. Ottawa has since waived the requirement that provinces provide matching funds. Instead, its latest offer is that it will pay for up to $10,000 of the grant, with a business covering the rest. Ottawa has indicated that this change means that it will fund fewer grants than originally planned.
Ottawa has also indicated that instead of cutting $300-million of the $500-million LMA transfer, it would cut $200-million of the LMA transfer and $100-million of the $2-billion LMDA transfer that is connected to the EI program.