Ottawa lent $3.5 billion to small businesses not eligible for the Emergency Account

The federal government granted $3.5 billion in interest-free loans to businesses that were not eligible for the Canada Emergency Business Account (CEBA) due to “inadequate” controls.

After looking into ArriveCAN and the CERB, the Auditor General of Canada (AG) is back with a new report that criticizes another program put in place during the pandemic by the Trudeau government.

If the CEBA loans were sent in a “timely manner”, Karen Hogan notes that the responsible ministries and state corporations did not work with a “concern for optimization of resources”.

Worse: she accuses Ottawa of being reluctant to “recover the funds”.

“If they don’t want to, they should be transparent with everyone. At this time, there is a reluctance to simply identify whether businesses were truly ineligible [au CUEC]“, she declared in a parliamentary committee.

His office calculates that $8.5 billion had still not been reimbursed to the State as of March 31, three years after the CEBA was stopped.

Too much power to an external firm

The problems don’t end there. The AG notes the great “dependence” of Export Development Canada on the consulting firm Accenture, whose name is mentioned 55 times in the report.

This multinational swallowed up approximately $230 million in public funds to manage, among other things, a call center to help entrepreneurs with the status of their applications.

Export Development Canada, a financially autonomous Crown corporation, signed an exclusive contract with the firm (under Accenture’s conditions) until 2028, with an option to renew until 2031.

“In the end, we just let Accenture set the terms, set the prices and continue to absorb public money, and ultimately…we don’t know much about what Accenture did,” he said. deplored Bloc member Nathalie Sinclair-Desgagné in committee.

“There were fundamental controls missing in contract management, yes. There are several invoices that were paid without questioning the charges or requesting supporting documents,” replied Karen Hogan.

Last March, the ministry signed a $78 million contract with Accenture for the recovery of overpaid loans, 85% of the work of which requires Accenture’s IT systems.

“A significant deficiency in our view is the fact that the contract does not contain costs or a detailed plan for the transfer of data to the federal government at the end of the program,” the report states.

CEBA in figures

$49.1 billion: Total loans disbursed

853 millions $ : Cost for managing the program as of March 31

9% : Percentage of ineligible businesses that received assistance

898 000 : Approximate number of SMEs having benefited from a loan