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Tight deadlines for stimulus spending affected results

When governments joined forces for a post-recession stimulus splurge, they gave us the worst of all worlds.

Although he didn't put it in so many words, that's the obvious takeaway from Ontario Auditor-General Jim McCarter's annual report, released Monday. Much like the recent work of Kevin Page, the federal Parliamentary Budget Officer, it suggests that the frantic efforts to get infrastructure spending out the door did not allow enough time to ensure it achieved either of its main potential benefits.

As governments responded to the Great Recession by pumping money into the economy, most public-policy experts agreed that the ideal projects would combine short-term job creation with long-term value to communities. But in many cases, the result appears to be the opposite: make-work projects that didn't actually make work, at least not as quickly as expected.

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As Mr. McCarter notes in his report, the $3.1-billion in shared federal-provincial spending that was the subject of his audit - part of more than $30-billion in planned post-recession infrastructure investment - was supposed to be spent on "construction-ready projects" that "could be substantially completed within two years." But by the end of the first of those years, by which point the governments had hoped that half the funds would be spent, only about $510-million (16 per cent) had gone out the door.

Perhaps more relevant, given that this was always supposed to be about employment, are the job figures. The three infrastructure programs that caught Mr. McCarter's eye were, all told, supposed to create or preserve about 44,000 jobs. But that number seems to have been only about 7,000 in the first year, when the need for new work was believed to be most urgent.

That would be understandable, perhaps even a blessing, if it had been to avoid haste making waste. But clearly, that wasn't the issue.

While crediting ministries with "significant efforts to establish the appropriate systems and processes," Mr. McCarter makes clear that tight deadlines impeded serious comparative analysis of proposals.

Just two weeks, in May and June of 2009, were allotted for assessing applications - and on the provincial side, that included about 15 staffers tearing through some 2,000 bids. In one instance, Mr. McCarter reports, a grand total of four hours was spent on "a key component of the provincial review for 56 projects with an estimated value of $585-million."

It didn't help matters that municipalities weren't asked to either limit the number of bids they submitted, or to prioritize them. So some municipalities opted for quantity over quality, figuring the more applications the better chance of getting money one way or another. In one particularly egregious example, a municipality submitted 150 applications; 11 of the 15 that were ultimately approved were "at or near" the bottom of that town's priority list, which of course the province hadn't seen.

In fairness to Dalton McGuinty's government, it could have been worse. In his news conference on Monday, Mr. McCarter said he looked for evidence of funds being directed disproportionately to ridings held by the provincial Liberals, and found none.

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But however noble the intentions, and however much a product of cross-partisan and multilateral consensus, the execution was clearly lacking.

Should the need arise for "similar future programs involving tight timelines," Mr. McCarter offers in his report, there are "a number of areas where improvements could be made."

No doubt. But there is one big, overarching improvement that should probably be made if economic and political circumstances repeat themselves. Next time, before they do anything else, they might find it useful to take a deep breath and figure out what exactly it is they're trying to achieve.

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About the Author
Political Feature Writer

Adam Radwanski is The Globe and Mail's political feature writer. More

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