Much of the media coverage of the WE Charity debacle has focussed almost exclusively on the relationship between the Kielburgers and the Trudeaus, where there is plenty of appearance of conflict of interest if no actual quid pro quo. This has come at the expense of a more detailed look at how the decisions about the Canada Student Summer Grant (CSSG) was actually made by public servants and political aides. Last Thursday's hearing of the Finance Committee gave us a chance to get a more balanced view of the process, and it tells quite a different tale about how the fiasco came to be.The star witness on Thursday was Rachel Wernick, the Associate Deputy Minister at Employment and Social Development Canada (ESDC) who was responsible for execution of the project. Wernick indicated she first learned about the government's desire to include a pay-for-volunteering component in its student support package perhaps a week before it was announced on April 22. She and her department were asked to provide suggestions in this area, and as late as April 19 ESDC, the Department of Finance and the Prime Minister's Office were still drafting a set of quite high-level program parameters. However, the specific details were unknown to her and her department on April 22, so much so that she had to ask the Department of Finance for a briefing that day to understand what was actually being asked of ESDC.It was at that meeting that Wernick learned that the entire program was meant to be launched in three weeks' time. And not just a soft launch: a national one, across the country, in areas both urban and rural and with special outreach to underserved populations. Though Wernick was too much of a professional to say so in front of the committee, it seems unlikely that she was thrilled about these instructions.The CSSG was, after all, a fairly complicated program. First, students needed to be recruited into the program (it is unclear how many students were intended to be accommodated, but the announced program budget of $912M and the maximum possible student payment of $5000 suggests that cabinet intended for at least 150,000 to participate). Charities and non-profits also had to be drafted into the program, and then students and volunteer opportunities needed to be matched and in many cases, on-boarding assistance needed to be delivered. At some point, eligibility verification of students and charities/NGOs needed to be developed and applied and then eventually money needed to be delivered to students.Given this complexity, it seems easy to see why Wernick's thoughts would have turned immediately to having someone outside government run the program through what is known as a Contribution Agreement. There was simply no way, given government staffing rules and the amount of work required, this could be achieved inside government in the time available. A Contribution Agreement would at least allow an outside agency to simply work out how to achieve these same high-level goals (e.g., recruit 20,000 students) on its own, thus sparing government the need even to think through the logistics. In the middle of a pandemic, with so much other work to do (ESDC was also given three other projects to develop on April 22 in total worth $8 billion), this must have seemed an ideal solution.Now, of course, even if the government was determined to parcel the administration of CSSG out to a third party, there is no reason it had to be sole-sourced, let alone sole-sourced to WE Charity in particular. But there was another consideration at work here. Wernick testified that in her view, the real challenge in getting the CSSG off the ground was that students would be hard to recruit because the Government of Canada simply wasn't particularly good at communicating with young people. Public service rules and youth cultures don't meet, was essentially her point. And therefore, as she framed the problem on April 22, she thought that what she needed was an outside partner which had a national reach, a very good social media game and was close to youth. Put that way, WE Charity does indeed seem like an obvious partner.However, this was not the only possible framing of the problem. The witness who followed Wernick, Paula Speevak of Volunteer Canada, noted that in fact youth are more likely to volunteer than any other age group. From her perspective, the bigger issues seemed to be how to get charities and volunteer organizations, already battered by the COVID-induced recession, to be able to on-board and supervise any students who showed up so that they could do productive work. If this framing of the problem had prevailed – had ESDC prioritized not the student recruitment side but the charity/NGO recruitment and onboarding side of the problem - WE Charity would have seemed a much less obvious partner, since its relations with other charities in Canada are not very good. Indeed, WE Charity is known to have tried to sub-contract this arrangement to Volunteer Canada, an arrangement the latter rejected based on philosophical issues with the overall program design unrelated to the nature of the Contribution Agreement.A final point of interest here is that ESDC chose to structure the Contribution Agreement with WE Charity in a manner quite different from the program's initial design: specifically, that it was much smaller in scope. The deal gave WE Charity $19.5 million – some of which was to be transferred to other partners – to recruit, place and onboard just 20,000 students. That's interesting partly because of the very high implied program overhead (20,000 students meant program expenditures of anywhere from $20 to $100 million based on hours worked, which implies an overhead of between 19.5% to 97.5%), but partly because even at full cost it would only use up about 13% of the funds that had been announced on April 22nd.The Contribution Agreement did foresee the possibility of a second contract worth slightly more (over $20M) to place a second tranche of 20,000 students, but no more than that. Which means in effect that the program ESDC designed was not more than a quarter of what cabinet had authorized. This is consistent with Wernick's stated view that the key implementation problem would be recruitment, but it may also have simply have reflected a view that to make the program any bigger would invite too many problems.Thursday's hearings also unearthed the fact that WE Charity's co-founders, Craig and Marc Kielburger, were using their fairly extensive contacts among Liberal cabinet ministers, that they had been hawking a proposal on social enterprises around Ottawa in early April, and that a modified version of this proposal was delivered to Wernick on the afternoon of April 22nd, all of which suggests that the Kielburgers had at least some advance notice of what was in the announcement. But this is not necessarily evidence of collusion; the Liberal government is usually pretty good at briefing important third parties on the contents of their upcoming announcements (disclosure: the author of this article was given an advance briefing on the April 22 announcement in connection with respect to the student aid program changes).Some have seen these discussions between the Kielburgers and the government as evidence that the two parties were colluding to create a program that only the Kielburgers' charity would be eligible to run, and perhaps there is some truth to this. But equally, there is a way of looking at this story as one of overly lofty political objectives meeting the cold hard reality of public administration. The speed at which CSSG – which of the dozens of programs announced over the past few months was perhaps the most ambitious – was expected to be implemented led to some very hasty decisions about sole-sourcing which might not have been made in a more leisurely planning cycle. The idea of trying to create a national service program in 21 days in the midst of the pandemic was wholly unrealistic, as the political aides who dreamt up the idea would surely have understood had they spent more time consulting with public servants before announcing the program.Perhaps the larger point here is this entire sorry story can be explained without reference to any influence-peddling or conflict of interest. Certainly, the affair has a whiff of cronyism, and plenty of appearance of conflict of interest. But there is an important cautionary tale here about the difficulties of making public policy on the fly, and future politicians and public servants would do well to understand it.
Alex Usher is President of Higher Education Strategy Associates, a consultancy based in Toronto which focusses on higher education finance and strategy as well as youth issues such as Access to Higher Education.