Provinces sitting on unspent federal pandemic funding

A new report on billions the federal government has sent to provinces to help safely reopen the economy suggests much of the money is sitting unused.

Today’s report also suggests that federal efforts to stretch the financial impact of those dollars is falling short as many provinces have bucked cost-matching requests.

The analysis by the Canadian Centre for Policy Alternatives says six out of 10 provinces haven’t spent all the money the federal government has sent their way, including for things like personal protective equipment.

Author David Macdonald says some of the money may yet be spent, but notes the longer it remains unspent, the less likely it ever will be spent.

Macdonald’s analysis is based on a review of provincial and federal spending announcements, reconciling duplications, as well as provincial spending documents.

Federal and provincial governments are allocating hundreds of billions in direct spending and liquidity support to help workers, families, front-line workers and businesses make it through the pandemic.

The federal treasury has managed the lion’s share of COVID-19 spending - accounting for about $8 in every $10 of aid, according to the federal Finance Department’s math.

“They are the ones spending the money, they’re the ones creating the funds and to a large degree setting the agenda of where they would like those funds to go,” Macdonald said.

Included in the spending is $24 billion the federal Liberals sent to provinces in the fall under the “safe restart” agreement that was supposed to help make it safer for daycares, schools and businesses to reopen.

The report notes that money is sitting idle from a fund aimed at topping up the wages of workers deemed essential like those in long-term care facilities and grocery stores. Provincial governments were supposed to chip in for part of the top-up.