The Financial Accountability Office of Ontario (FAO) has released a comprehensive report detailing the financial implications of relocating ServiceOntario centres into Staples Canada stores. Originally requested by the province's Liberal Party, this examination was crucial in understanding the financial impact of this strategic move. The relocation, part of a sole-sourced, three-year taxpayer-funded agreement, aimed to optimize service delivery while reducing costs. The first six ServiceOntario centres transitioned on February 1, 2024, with the final three scheduled for May 9, September 12, and December 4 of the same year.
The initiative was initially projected to save taxpayers $900,000 over three years. However, the FAO's findings indicate that the cost has soared beyond expectations. Initially estimated at $10.2 million, the actual cost stands at $11.7 million, marking a $1.5 million increase over the government's original assessment. This discrepancy arises from the increased operating hours at the new locations, which surged by 47.7 percent compared to the former centres.
"The FAO estimates that the cost to relocate and operate the nine ServiceOntario centres in Staples Canada stores will total $11.7 million over the duration of the Staples Canada agreement to Jan. 31, 2027," stated the FAO.
The FAO attributed part of this additional cost to the unexpected rise in operating hours. The government's original projections had anticipated a 30 percent increase in operational hours, yet actual figures far exceeded that estimate. Despite the higher costs, some savings will be realized through a reduction in service desks, which were decreased by 30 percent as part of the relocation.
"However, this will be partially offset by a 30 per cent reduction in the number of service desks," noted the FAO.
Compensation arrangements also factored into the financial analysis. The government is expected to cover one-time setup costs and ongoing operating expenses related to the transition. These compensations consider factors such as the number of service desks and staffing costs at each location.
