‘Not in the public interest’: Liberals won’t try to recoup $34 million paid by ‘green slush fund’ to ineligible projects

Minister of Industry Mélanie Joly speaks during Question Period in the House of Commons on Parliament Hill in Ottawa September 21, 2026. Photo by Blair Gable /Postmedia

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OTTAWA — The Liberal government says it will not try to recover any of the at least $34 million in ineligible funding paid out by the so-called “green slush fund,” saying such efforts would not be in the public interest.

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Industry Minister Mélanie Joly quietly made the revelation in a response tabled last week to questions by Conservative MP Luc Berthold on the now defunct Sustainable Development Technology Canada (SDTC).

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SDTC was a scandal-plagued cleantech fund derogatively referred to as the “green slush fund” by Conservative MP. It was dissolved in 2024 by then industry minister François-Philippe Champagne after a scathing report by the Auditor General on the organization.

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In the response, Joly said roughly $34 million was paid out by SDTC to ineligible recipients who applied and performed “in good faith.”

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“Therefore, as a matter of fairness and sound stewardship of public funds, it was determined that further pursuit of recoveries was not likely to be successful, and not in the public interest,” reads the document.

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In a statement, Berthold and colleague Aaron Gunn lambasted the decision, which they said flies in the face of the will of MPs of all political stripes. In 2024, the Commons Public Accounts committee unanimously expressed “extreme concern with the blatant disregard of taxpayer funds” called on the government to recoup them.

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In her 2024 report, Auditor General Karen Hogan found that of the 58 SDTC-funded projects she audited, 10 were ineligible for such funding totalling $59 million.

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Furthermore, she found 90 cases where an SDTC board member participated and voted in a discussion about a contract despite being in a conflict of interest.

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Hogan also found the organization had serious governance issues.

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“It’s not always clear that funding decisions made on behalf of Canadian taxpayers were appropriate and justified,” she wrote of SDTC.

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At the time, SDTC leadership only partially agreed with some of the key findings in Hogan’s report. It disagreed with some of her findings on funded project eligibility.

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The report not only led to the dissolution of SDTC (whose activities were folded into the National Research Council), it also sparked multiple parliamentary committee studies, a call by Conservatives for an RCMP investigation and a months-long logjam in the House of Commons over access to documents.

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Joly’s response tabled last week sheds new light on what happened to SDTC after Hogan’s report.

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It reveals that SDTC decided to conduct its own review of 158 projects it funded, including those audited by Hogan. The review included “three independent third-parties,” which are not identified.