Opinion: Does Ottawa even care about getting value for taxpayers’ money?

Skip to Content News Archives Economy Defence Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Defence Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Defence Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomeFP CommentOpinion: Does Ottawa even care about getting value for taxpayers’ money?Few departments do value-for-money evaluations. Instead they ask program beneficiaries if they're happy to get the money. They usually areLast updated 12 minutes ago “Value for money” is a principle everyone accepts. We need to close the gap between principle and practice. Photo by JulieAlexK/Getty ImagesFederal politicians trying to identify underperforming programs during the current “comprehensive spending review” have likely been surprised by how little help they get from evaluation reports prepared by public servants. Their expectations would have been higher given the abundant resources allocated to assessing programs.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountEvaluations haven’t made much of a contribution to the spending review because they typically focus on the response of beneficiaries when assessing program performance. That’s a low bar for judging success. Beneficiaries of spending programs always respond favourably.This advertisement has not loaded yet, but your article continues below.To be genuinely useful in spending reviews, evaluations must assess whether programs deliver value for money by comparing benefits received to the costs incurred creating them. Unfortunately, this approach is the exception rather than the rule. I recently reviewed 48 evaluations conducted in eight federal departments from 2020 to 2024 and found that only four went beyond assessing impacts on program beneficiaries to examine via a careful comparison of benefits and costs whether they delivered value for taxpayers’ money. The evaluations of labour training programs conducted at Employment and Social Development Canada were one of the exceptions. Their rigorous assessment clearly demonstrated that these programs do provide value for money.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThe shortage of value-for-money evaluations is surprising given that the federal government describes its expenditure management system as being “designed to ensure that all programs … provide value for taxpayers’ money.”What explains this gap between principle and practice? The immediate reason is that under the current policy, value-for-money assessments are optional, not mandatory. But that prompts a further question: why do evaluators generally choose not to conduct them? One explanation is that they’re complex, requiring specialized data systems and technical expertise that departments do not have and would take time and resources to develop.This advertisement has not loaded yet, but your article continues below.Why don’t politicians insist that departments build the capacity required to assess all federal programs through a value-for-money lens? One possibility is that, while agreeing with such assessments in principle, politicians balk once they realize they would limit their discretion to use spending to win elections. In “normal” times, ministers don’t see any electoral upside to providing evidence that programs they are responsible for — or, even worse, programs they have championed and implemented — aren’t working.Ministers have good reason to be concerned about drawing attention to underperforming programs. In a 2024 paper published by the School of Public Policy at the University of Calgary, I found that many government programs, particularly business subsidies, would fail a value-for-money test. That’s a discouraging conclusion but it also represents an opportunity for ambitious ministers and officials. Eliminating or reforming poorly performing programs would allow the current federal government to pursue its agenda of investing in a stronger economy and more robust national security without raising taxes or adding much to our already high debt.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The timing is therefore right to put value-for-money assessments into practice. Coincidentally or not, Ottawa’s evaluation policy is now under review. Bold reform could dramatically increase the value Canadians receive from federal spending. In our recent C.D. Howe Institute report, Benoît Robidoux and I set out a comprehensive plan for achieving this goal.Our key recommendation is to make value-for-money assessments mandatory, using a framework that captures all the benefits and costs of a program, private and social. Another important recommendation is to require that new spending programs pass a simplified value-for-money test. In practice, this would make existing approvals more rigorous by applying a benefit-cost framework.Finally, we recommend that Ottawa set up an independent “evaluator-general” to help build departmental evaluation capacity but also to undertake evaluations while departments are getting up to speed. The EG would also be able to challenge departmental evaluations and undertake evaluations of programs administered by more than one department.This advertisement has not loaded yet, but your article continues below.Conducting and publishing value-for-money assessments would allow all Canadians, not just politicians, to have an informed opinion about the worth of federal programs. A better-informed electorate could support better policy choices and increase politicians’ incentive to fix programs that are not working — which would be good for our democracy.“Value for money” is a principle everyone accepts. We need to close the gap between principle and practice.John Lester is a fellow-in-residence at the C.D. Howe Institute. We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. 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