April 9, 2019 11:22 am
Updated: April 9, 2019 11:05 pm

Why is Loblaw getting $12M to install new refrigerators? McKenna under fire for new funding

Environment Minister Catherine McKenna on Tuesday defended her department's decision to give Loblaw $12 million to buy and install more energy-efficient fridges for their retail stores.

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Environment Minister Catherine McKenna is defending the decision to give up to $12 million in funding to Loblaw so it can install more energy-efficient fridges.

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That comes just a year and a half after the company fought against raising the minimum wage, admitted to a 14-year bread price-fixing scheme and ended up in a tax court battle last year that saw it ordered to pay back taxes worth roughly $368 million related to a banking subsidiary in the Caribbean.

READ MORE: Loblaw admits to bread price-fixing for 14 years

“We have a climate plan that works with everyone. It works with large businesses, small businesses, cities, schools, hospitals, municipalities,” McKenna said when asked by Global News why the company, which had net earnings of roughly $800 million last year, needed taxpayer funds to retrofit its stores.

“Loblaw was one of the 50 winners through the competitive process. Why? Because they can get the most significant emission reductions.”

McKenna compared the emissions reduction effect of retrofitting the fridges in 370 Loblaw stores to taking 50,000 vehicles off the road every year.

She added that three-quarters of the money for the retrofit is being put forward by Loblaw, which will commit roughly $36 million.

WATCH: McKenna defends plan to give Loblaws $12M for new fridges

Loblaw, which is owned by the second-richest family in Canada, will get $12 million under the Liberals’ new Low Carbon Economy Challenge Champion stream.

That program is part of the Low Carbon Economy Leadership Fund, which allocated roughly $2 billion to fund clean technology to reduce carbon emissions.

The first recipient under the Low Carbon Economy Challenge Champion stream, announced in January 2019, was a project by Enwave Energy Corporation to use deep, cold water from Lake Ontario to cool hospitals and other government, educational and highrise buildings in downtown Toronto.

Roughly 50 others have also been awarded funding through the program, McKenna said.

WATCH: Watchdog says Canada’s climate plan is ‘slow’ and ‘disturbing’

But the announcement by McKenna on Monday has prompted criticism from the opposition parties and both civil and taxpayer advocates who are questioning why the government is giving money to help a profitable company retrofit the fridges in 370 stores and whether there are checks in place to monitor the funds.

The $12 million is set to be used by Loblaw for retrofits scheduled to take place between 2019 and 2022.

But it is not clear at this time whether the $12 million was given out in one chunk or whether it will be broken down as Loblaw hits retrofit targets, particularly given 2019 is an election year that could potentially see the Liberals — and their emissions-reduction focus — booted out of office.

Global News asked McKenna specifically whether the money will be given upfront or if any of it is contingent on how much work the company actually does.

However, she did not directly answer the question.

“This project is of course contingent on them doing what they said they would do, which is a retrofit program across the money,” she said. “They’re putting in three-quarters of the money, we’re putting in a quarter. It was a competitive process.”

Her department has also yet to respond to a request for clear details on what process is in place to ensure the full retrofit is carried out as well as for an answer to how the money is being dispersed to Loblaw.

The Conservatives and NDP both used question period on Tuesday as a chance to hammer the government on the decision.

That comes after critics for both parties took to Twitter on Monday night to condemn the move.

Civil society and taxpayer advocates also criticized the decision.

Andrew Cash, a former NDP MP and now co-founder of the Urban Workers Project, which advocates for precariously-employed urban workers, suggested the company had to be incentivized “in order to do the right thing” using tax dollars taken from the people their bread price-fixing scheme and efforts to oppose the minimum wage may have had the greatest impact on.

Aaron Wudrick, federal director of the Canadian Taxpayers Federation, also criticized the funding as a “handout” that seemed at odds with the government’s argument that it is putting a price on pollution from big emitters through the carbon tax.

A funding agreement still needs to be hammered out, according to a press release from Environment and Climate Change Canada on Monday.

© 2019 Global News, a division of Corus Entertainment Inc.

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