The recent federal budget announced a plan to abandon co-operation in favour of an expensive, untested and probably unworkable alternative – the Canada Job Grant. There is no documentation, study or analysis to show that the Canada Job Grant could address our skills training needs. No one knows how it will actually run and Ottawa has not yet introduced legislation to set up the program. The only thing working about the Canada Job Grant so far is the advertising campaign telling us that it is a wonderful initiative.

But skills training programs are managed by provinces, not Ottawa. Through the soon-to-expire Labour Market Agreements, the federal government supports provincial training services with $500 million annually. In return, the provinces report on results and agree to overall guidelines for the programs. This division of responsibilities reflects a consensus that designing and delivering skills training is best left to the provinces. Until the sudden announcement in the recent budget, the current federal government had been an enthusiastic supporter of this consensus, preferring to stay out of areas of provincial jurisdiction.

According to the budget, the Canada Job Grant will pay a grant of up to $15,000 per trainee to businesses that sponsor short-duration training programs, with $5,000 from Ottawa and an equal amount from each of the employer and the province where the trainee is located. Rather than respecting provincial jurisdiction and expertise, the federal government proposes to pay for its share of the Canada Job Grant by cutting $300 million from its support for provincial training services. On top of this cut, provinces will have to come up with an additional $300 million to match federal contributions. Unless provinces eliminate funding to current programs, which means shutting down hundreds of proven training programs, they will need to come up with a total of $600 million annually, on top of the costs to administer a grant program that needs significant vetting and monitoring.

Beyond the impact on provincial budgets, the proposed Canada Job Grant is deeply flawed public policy. The grant would remain out of reach to many unemployed Canadians and the employers it is intended to serve. Many small businesses do not have the resources to apply for a grant, let alone design a training program. Because the Canada Job Grant would only subsidize short-term training, it would not meet essential skills needs (literacy and numeracy). Nor would it prepare Canadian workers for the needs of high-demand occupations such as accountancy and health care, most of which require years, not weeks of training.

The provinces are understandably not falling into line. Quebec has already said no. Other provinces have voiced strong objections. It is not clear what would happen if a province refuses to participate in the proposed federal program. Would the federal government only offer the Canada Job Grant in provinces that match federal spending? If so, it would represent an unprecedented act by the federal government, holding unemployed and underemployed Canadians hostage to a federal-provincial dispute.

This conflict, initiated by Ottawa, was entirely avoidable. The Prime Minister and Canada’s premiers have each spoken publicly about the need to address Canada’s skills challenges. It is unfortunate that the federal government used its 2013 Budget to stop this momentum before it had a chance to get rolling.

But it is not too late. Governments, businesses and the non-profit sector all want to help workers obtain the skills they need. There is a rare opening for a national discussion on Canada’s training needs.

Canada’s premiers invited the Prime Minister to discuss the economy last fall. Now would be a good time to accept that offer — and for the federal government to drop its confrontational Canada Job Grant.

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Michael Mendelson is Senior Scholar at the Caledon Institute of Social Policy. Noah Zon is a Senior Policy Associate at the Mowat Centre.

The authors’ new report: The Training Wheels are off: A Closer Look at the Canada Job Grant was released today. It can be found here.