An audit report out on December 2 shows that Canadian Prime Minister Justin Trudeau approved billions of dollars in loans to ineligible candidates during the COVID-19 pandemic. Auditor General Karen Hogan presented the findings in the House of Commons, highlighting alarming irregularities in the administration of public funds associated with the Canadian Emergency Business Account program.
The CEBA program was rolled out in response to the pandemic-related economic downturn, with a goal of supporting small businesses, and dispersed more than $49 billion in loans to over 900,000 businesses. But according to Hogan’s report, about $3.5 billion of that went to companies that weren’t eligible for the program.
The audit also highlighted that Finance Canada showed a lack of “effective oversight” over at least more than $853 million in administrative spending related to the program. Hogan noted that while the government had to move quick to act and support businesses during the pandemic, there is still an expectation around due diligence and proper controls over public spending.
The report faulted the Trudeau administration for failing to manage the program properly, particularly by making heavy use of one private contractor—Accenture, an international IT company—to oversee the fund. Specifically, about 91 percent of the $230 million budget put toward contract spending went to Accenture, which received the contract without competitive bidding.
The audit also revealed that there was no plan to collect repayments by businesses in default. As of the end of March this year, more than $8.5 billion in loans had not been repaid by businesses, casting doubt over financial accountability and program effectiveness.
