NDP's Catherine Fife criticizes unspent Liberal grant to OpenText

NDP finance criticCatherine Fife is calling for the Ontario Liberal government to end their current method of awarding funding to private businesses in the province and move instead towards what she calls amore transparenttargeted tax creditsystem that would only benefit companies who prove they have created jobs.

The WaterlooMPP'sremarks come after a CBC News story revealednoneofa promised $120 million grant to business software makerOpenTextto create1,200 jobs in the province hasn't been paid outbecause the company so far hasn'tbeen able to create anyjobs.

The grant was announced at the end of April 2014, just before a provincial election was called.

"When you have a targeted tax credit approach, it's a more accountablemethod of supporting businesses, because the business understands the rules of engagement." said Fife. "If a companycreates a job, a new job, then thecompany receives a tax credit for creating that. There's aresponsibilityonbehalfof the business to prove to thegovernmentthat real jobs werecreated."

"Private companies actually appreciate theopennessand transparency on that, because it's a levelplaying field," she said.

"Right now, the public as a whole has no idea what the obligation is on the part ofOpenTextor what the government has promisedOpenText."

Auditor generalcritical of process

OpenText announced it would be cutting 425 jobs from its worldwide workforce a year after it received the provincial jobs grant,but didn't specify whether any of the lostjobs would be in Ontario.

In response, the province said that OpenText would not only have to replace any Ontario jobs lost in the cuts, but it would also have to create new jobs in order to receive any part of the promised $120 million grant.

"The ultimate question really... isaround transparency and accountability," Fife said.

"We just don't know the conditions of that contract," she said. "This government continues to hand out hundreds of millions of dollars withoutaccountability and without transparency."

• Auditor general blasts more than $1B in grants to businesses

Ontario Auditor General Bonnie Lysyk released a report in December 2015 into the $1.45 billion worth of grants doled out by the Ministry of Economic Development to businesses over the last 10 yearsto provincial businesses.

Lysyk's report said that while the money was given to a range of companies from high tech firms to autoparts makers, she noted the government doesn't know if the money creates long-term jobs or helpsthe province's economy.

The auditor general also said the fundingprocess lacked "fairness and transparency."