Auditor General criticizes Ottawa’s management of COVID-19 loan program

In a haste to provide COVID-19 relief to small businesses, Ottawa “mismanaged” its loan rollout, according to Canada’s Auditor General. Today, she released a report revealing that the Canada Emergency Business Account (CEBA) program lacked “value for money.” The report highlighted that Ottawa failed to provide adequate oversight after billions of dollars were handed out to ineligible recipients. It also noted that one of its crown corporations relied on a single-source contractor to help administer the program.

Today, Karen Hogan released her report on the Canada Emergency Business Account program, which lent $49.1 billion to 898,000 small businesses to help cover expenses such as rent and payroll during the pandemic. However, the report estimates that $8.5 billion remains outstanding, and $3.5 billion went to businesses that were deemed ineligible to receive the money.

In a joint statement, Finance Minister Chrystia Freeland and Small Business Minister Mary Ng said, in part:

“While the Auditor General offers some good and useful recommendations, this report fails to properly acknowledge that CEBA was designed and delivered during a global pandemic. Within less than two weeks, the federal government established new emergency support…”

The report also noted that Export Development Canada, the crown corporation responsible for the program, acted quickly to distribute the loans but relied heavily on a sole-source contractor without strong checks and balances. IT firm Accenture was tasked with managing the loan program.

The crown corporation told CHCH News: “This third-party support was necessary to develop and operate new systems to evaluate applications, fund, track, and collect loans, share information with financial institutions, and establish and maintain dedicated CEBA resources for applicants and loan holders.”