Human Resources Committee on Oct. 5th, 2022

[Sandra Charles]

I'll start by saying that when we look at the "Unfunded" report, we can see the need is huge. With that initiative, we have definitely laid a good foundation.

With the collaboration of the intermediaries, we really wanted to create a foundation to build the ecosystem so that indeed, moving forward, as I heard other witnesses mention, the government can continue to work with the community, listen to the community and, with it, determine how we can build on the very important momentum the initiative has created.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you for that. I hear there are still more connections and there's more information to hear about from the communities that have experienced using the fund.

That goes with my next question. We heard some testimony that more connections are needed in western Canada. I'm from B.C. and I know that although there might not be as many organizations, there are still lots of organizations in B.C. that would like to see some funding come their way. How do we get British Columbia involved in this initiative?

[Karen Hall]

I would say at the outset that national coverage is exceedingly important for this program. We have four intermediaries across the country—Edmonton to Halifax—and through them, we're seeking to ensure there is broad coverage across the country.

Would you like to add anything, Ms. Charles?

[Sandra Charles]

I would add that the mandate of our intermediary to the west is really to cover the region, so it's about collaboration, paying attention to where our fund is distributed and identifying other regions that need attention. It's definitely an opportunity that we can explore with our intermediaries.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

That's great.

I have a question on intermediaries. Is there any potential to expand the number of intermediaries or talk about how they get transferred into the endowment fund? Is there any talk about expanding them and making the network wider?

[Karen Hall]

There are two points there.

On the question of adding intermediaries, initially, the program started with three intermediaries, and then a fourth, in the west, was added after a bit of time. I would say that in the future, there is the potential for other high-capacity organizations to join as intermediaries. That remains to be determined and decided, but I think it is in the range of possibilities.

In terms of the endowment fund and how it is going to work, once the foundation is selected to, in effect, run the endowment and manage the funds, that organization will be making granting decisions across the country. The call for proposals was quite clear about the need for regional representation, regional bodies and regional feedback to ensure that a broad range of communities across the country are heard and that the funding is accessible very broadly.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Earlier, Ms. Hall, you mentioned hiring and said that some of the funding was used to help organizations hire permanent staff instead of having to rely exclusively on volunteers.

How can the federal government do more to support operating funding, which really is needed to build capacity?

[Karen Hall]

As Katie mentioned earlier, there is an operational component included in the grants and contributions agreements—normally up to about 15%—and those funds can be used for the administration of the program.

Now, we have heard calls for more permanent operating funding. Generally, the funding model that has been taken up more broadly for grants and contributions programs is that the funding is directed on a more project-specific basis rather than to fund the core operations of organizations. There are some exceptions, but in general, that's the approach that has been taken.

[The Chair, Liberal, Bobby Morrissey]

You can ask a short question, Madam Zarrillo.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

That's great.

In some of the testimony we heard, organizations said they would like a bigger percentage to go toward operating, and you're saying that's a possibility, so that's great.

Thank you.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

Now we'll go to Madam Gladu for five minutes.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you, Chair.

Thank you to the witnesses for being here today.

I want to echo what Ms. Chabot asked for regarding quantitative measures of the success of the fund. Could you table those with the committee and include the baseline of where you started and where we are today so we can see it? I think Ms. Charles indicated that you're on track, and I just want to see what specific quantitative measures you have.

There was a reporter from the CBC last year, Desmond Brown, who identified that concerns were being expressed by Black-led organizations that their funding applications were being rejected because they didn't qualify. I want to know how the department defines “Black-led organizations”. Was there consultation with Black-led organizations and Black communities to establish the definition?

[Karen Hall]

There were concerns raised last year about the decision-making for this initiative. The department listened, and listened carefully, to the feedback that was received.

I think Katie can speak to us a bit about what we heard, what we've learned and the changes we've made.

[Katie Alexander]

I think you're referring to the initial call for proposals that we had for capital assistance. That was the direct funding provided to organizations to improve and renovate their facilities. That call was run in July 2020, and it was majorly oversubscribed. At that time, the department realized, following some engagement with stakeholders, that with the oversubscription, we provided a bit of an administrative burden to organizations by requiring that they explain to us how they are Black-led or Black-focused.

What we did then was began to revisit all of those applications. We reviewed all of them, the over 1,700 that we received, and ended up funding over 1,300. That also led to a review of our internal systems to figure out how to improve the way we manage our processes moving forward. Three main areas were improved.

Our application process was improved. We provided more clarity in our applicant guides to make sure they're clear so that organizations can understand how to apply and what eligibility criteria we're looking at.

We also looked at improving our application form by moving to an attestation-based indication of being Black-led. This means self-identifying as Black-led so that it's not being determined by the department.

The third element was a bit more client-centric and about doing a little more through a call for proposal, with information sessions, for example, and providing an opportunity for organizations to contact the department if they have questions, and, on the tail end, expanding the opportunities for organizations to come back to us with missing information. Typically, that's 10 days, and we expanded it to 15 days so that new organizations that aren't used to doing business with the government are able to allow a little more time.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you for that.

We did hear some testimony from some of the smaller organizations. They said they didn't have experience in applying to the government and needed some help with that. We also heard, to Ms. Zarrillo's point, that they were looking for more flexibility in operational funding—I think you said 15% is allowed—and the ability to be flexible depending on the project. I think we heard about that.

You talked about the three pillars: capacity building, systems change and emerging gaps. What are the emerging gaps you see going forward?

[Karen Hall]

We are relying on the voices of the community to hear about the gaps they see. Their voices are really essential for us in identifying those gaps.

One of the gaps we heard about was in Nova Scotia related to the former Nova Scotia Home for Colored Children, which had fallen into disrepair. It certainly is a very important though complex site in the history of the Black community in Nova Scotia.

Some of that funding was used by the Akoma Foundation to renovate the home and turn it into a hub for the community. Sandra and I visited there over the summer. It has become, and will be, a very effective and welcoming place for the community. We heard from the community that this was an important priority.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

Now we'll go to Madame Martinez Ferrada.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

Thank you, Mr. Chair.

I also want to thank the witnesses for their presentations.

I have a few quick questions.

As my colleague Madame Chabot said at the outset, the purpose of the program is to tackle inequalities and target capacity building. You talked about how data can be used to evaluate the effectiveness of the program. Does the data also illustrate how this fund has helped SMEs or smaller entrepreneurs? Consider a neighbourhood hairstylist, for example. Not every small business owner has the means to come up with a business plan. Plus, let's face it, they have been subject to a lot of racial profiling, even by banking institutions. From that perspective, how can this fund better support these small business owners?

Also, how is the risk assessed? Some witnesses wondered whether they could get funding through the program in situations where banks wouldn't give them a loan. I'm comparing this situation to what's happening in some other countries, specifically initiatives involving microcredit. How can risks be assessed in a way that builds capacity in a population that for years has been racially profiled by financial institutions?

[Sandra Charles]

Thank you for the question.

I will not attempt to answer on behalf of businesses, since the program is aimed primarily at non-profit organizations. We don't consider an organization's application from a risk assessment perspective. Rather, we look at the organization's potential and whether it meets the needs of the community it serves, among other things.

Consider the following example. I know of one organization that was new and had a really hard time getting any funding, because it had never dealt with any government or private entities. We funded the launch of that organization, which had a program and objectives. We helped them design a strategic and organizational plan, develop their activities and establish their governance structure. This new organization received funding through our initiative and was able to offer its services to the community. This company offers support services on starting up a new business. It had planned to fund only five start-ups in the first year, but thanks to our investment, it was able to fund 12.

That's the kind of effect the initiative can have. Our support is not given directly to businesses, but rather to organizations that have a mandate to serve the Black community.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

You mentioned two programs. Can you talk about the differences between Quebec and the other provinces in that regard? What exactly is the process? Why are some wait times longer?

[Sandra Charles]

I'm not in a position to properly answer that, but I'd be happy to provide you with a written answer.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

Thank you.

You talked about how to make the support offered by this fund sustainable, in keeping with the goal of better supporting these organizations and targeting capacity building. I know this is a very popular program, and yet there are people in my riding who have never heard of it.

How do you inform people about the fund? In order to invest money in these organizations, people need to know that the fund exists.

[Katie Alexander]

There are couple of things. We really are leveraging our national funders to help us promote some of the initiatives for supporting Black Canadian communities. We're also doing more, as I mentioned, to try to have information sessions and promote when calls for proposals open. We're availing applicants of a contact in the department where they can ask questions.

We're trying to make sure that we are making those connections in communities and then offering opportunities to promote those calls for proposals and opportunities for additional funding.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

I'd like to make one last comment. It would also be a good idea to work with organizations outside of Black communities in order increase awareness of this fund. As I said, there are organizations in my riding that didn't even know this fund existed. There is work to be done in that regard.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madame Martinez Ferrada.

Madame Chabot, go ahead for two and a half minutes.