The Future Of Sport In Canada Is Clear – Just Fund It Properly With A Simple 1%

A few weeks ago, the Canadian government's much anticipated report on the state of sport in Canada was published by the Future of Sport in Canada Commission (the hand-picked experts charged with its creation). The issuing of this preliminary report was followed up with a conference in Ottawa earlier this month attended by Canada's sport leaders to discuss the Report (note that’s what I'm going to be calling it from now on) with the Commission.

The Report itself is quite typical of what you tend to see from government-struck Commissions like this. Woefully overwritten, this ‘preliminary' Report clocks 382 in page count, filled with endless citations and unnecessary background information. For example, there are 78 pages alone just explaining why people play sports and how the Canadian sport system works at a national level. Aside from the forests of trees and lakes of printer toner it must cost to print it, I’m told the Report cost $10m to produce. (To compare, the government of Ontario's contribution to its Ontario Amateur Sport Fund this year, which funds the province's 65 provincial sport governing bodies was just over $8.2m.)

However, padded with guff as it is, the Report does admirably cut to many of the key issues in Canadian sport. There is a clear calling out of old chestnuts of systemic incompetence and under-performance from top to bottom in Canadian sport that jaded sport consultants like me have been calling out for years – in particular poor governance, weak leadership and national sport governing bodies’ (NSOs) lack of ability to control or even influence how their sports are run on the ground across the country. The Report also points a finger at the chronic, systemic lack of funding, and what is funded or not, which is at the root of so many problems the system is burdened by.

But what is this Report really going to accomplish?

If you haven't read it yet, let me save you a full day of reading and paper shuffling. Here are the most important points in this Report, and what we need to do with what has been unearthed.

1) National Sport Organizations (NSOs) have very little reach into their respective sports outside of their national athlete development programs

This is not due to lack of desire or effort on the part of NSO leadership. It's simply down to resources. NSOs are only funded by Federal government to do national-level sport things. In the past, this has largely meant athletic excellence on the international stage. These leadership organizations are given very little if any funding to impact sport at provincial/territorial level, regional level, or community level across the country. And since most cannot raise significant commercial revenues, NSOs bring very little funding or sport development support to their provincial/territorial affiliates and community clubs. So they have little influence beyond the rules and policies they impose (but have little capacity to actively enforce – this is a big deal when we look at Safe Sport).

It means national leadership of sport is largely ineffective in a holistic sense, as the system is a bottom-up funding model, where the parents of youth sport athletes carry more influence with their credit cards than the governing bodies.

Let’s look at the broader figures to understand how.

The Report notes that the Federal government issued just under $233m in funding to Canadian sport in 2024. This feels like a big number, right? But the reality is that about $7bn was spent last year in Canada funding amateur sports. And that's before we factor in the contribution of volunteers in Canadian sport, which was valued at $8.4bn in 2018 (sport and recreation combined), contributing free manpower to the system equivalent to 863,000 fulltime positions.

The Federal government’s ‘funding' of amateur sport in Canada is in fact only about 3.3% of what it’s costing us to run the system. The rest is largely covered on a pay-to-play basis by ordinary Canadian families in the community.

So when it comes to who the real boss is in Canadian sport? Sorry, it ain’t you Mr Carney. It’s the soccer moms.

Indeed, sport governing bodies at national and provincial/territorial level are so underfunded by government that they usually have to tax the system they govern through affiliation fees to fund their operations, to the tune of way more than they grant back in. This naturally creates resentment among their affiliates. Often, there are very poor agency/principal relationships between national sport organizations, their provincial/territorial counterparts (PSOs) and the club-based community sport system, as community sport sees these governing bodies as nothing more than taxation agencies, charging affiliation fees for no value-add in return. So it renders NSOs ineffective as agents of their respective sports from recreational toddler to Olympian.

The Report makes some mention of this, but seems to only give it passing head-nods. It certainly doesn't recognize this vertical disconnection in Canadian sport as the major flaw that it is in how the system operates, that makes it impossible to effectively lead the sport system from Ottawa.

2) Canadian Amateur Sport Is Being Squashed By Rising Expectations Of Doing More With Less

You remember the first Star Wars movie, right? You won't forget the scene where Luke Skywalker and his seventies-haircutted buddies find themselves stuck in a garbage compactor on the Death Star. Our heroes are getting crushed from contracting walls that seemed impossible to stop. If you don't know what happened to them, then shame on you – buy Disney+ and watch the movie. But the point is, Canadian sport has been a bit like the Death Star garbage compactor over the past 20 years. Here's how.

In one advancing wall, we have decline in Federal funding. The Report does a good job pointing out the fact that Federal funding to Canadian sport has not increased since 2005. This means when you factor in Consumer Price Index (CPI) based inflation (remember how crazy that got post-Covid), funding to Canadian sport has actually been declining from a relative value standpoint by about 2-5% annually on a compound basis since 2005.

But that's not all. It’s not just the decline in the thickness of the overall funding envelope. It's also what it’s paying for.

Funding used to be quite broadly assigned as ‘core grant' funding, which sport bodies could use for pretty much whatever they liked to cover their operating costs. But increasingly, the government has been cutting core grant funding, preferring to fund more politically-expedient, ‘photo-opable’ projects and events.

You see, being seen funding a teary-eyed athlete clutching their medal having achieved their lifetime dreams is far more attractive than a photo beside Penny, who has been the overworked and underpaid administrator at an NSO's office for the last twenty years (and looks and feels every part of it), but who the organization relies on heavily behind the scenes.

So when the funding that pays Penny’s salary is inevitably cut, she eventually is let go because the NSO can't afford her wages on their own. However, the long grant applications, interim reports and post-funding outcome reports still need to be completed. But with no Penny to do it, who does it fall to? The CEO, of course. Sadly, most CEO’s in sport governing bodies aren't out actively leading and developing their respective sports. They're busy ticking boxes and shuffling paper for the bureaucrats in Ottawa.

Wasted leadership, misaligned work responsibilities, driven by a poor, politically motivated funding model based on short-term thinking.

Then there’s our second wall, on the opposite side, advancing rapidly and about to squeeze our poor sport system further into burger patties. This wall is about how much more the sport system is constantly being asked to do.

Some of this is the addition of more and more bureaucracy and reporting required to qualify for funding, all in the name of ‘greater accountability’ in the system. Don’t get me wrong. Accountability is good. But if showing it burns up the very resources that are being granted to get the sport work done in the first place, what’s the point? And some of the information being asked for, particularly around advanced sport participation data, simply isn’t available to NSOs because they don’t have the resources to invest in the capabilities to capture it.

More with less. It sounds great. But in reality, it simply doesn’t work.

Then throw in something like Safe Sport.

No one would argue that keeping athletes safe should everyone's priority. But the government needs to be careful about stating what an industry that is run on the backs of volunteers can truly achieve here.

I don't think the RCMP is out there guaranteeing that there will be no crime anywhere in Canada. Sure, they’ll do their best to prevent crime wherever possible. But crimes will continue to be committed, regardless of what the RCMP does and how it is funded.

Some people won’t like me saying this here, but safety in sport is no different. We can work hard to police it and reduce situations where athletes are exposed or vulnerable. But make no mistake. No matter what we do, people will continue to get hurt participating in sport and bad actors will continue to lurk (as they will in our education system, places of work, and so on). We can lessen this risk, but we can’t eliminate it.

The Federal government has initiated commitments to Safe Sport requirements that people in the Canadian sport system that are bold and well-meaning. But are they achievable, and at what cost? The extra administration and complexity Safe Sport measures are adding to a system that already struggles to keep the lights on, is fueling this second wall that is crushing Canadian amateur sport.

Even setting up Safe Sport systems within the national programs of the industry, that cover only hundreds of athletes, has been challenging. And establishing mechanisms of complaint reporting has resulted in deluges of abuse claims, some of which are genuine, but many of which I am told are frivolous and are simply overloading the system. All of this is overloading an already fragile system with administration, complexity and confusion over who is responsible for what and how to pay for it all. How Safe Sport can be fully cascaded down to community level, where millions of athletes either participate today, or have in the past, is hard to fathom.

But the government continues to push the sport system to do it anyway. And to simply say ‘you deal with it, sport system; and if you don’t, your funding is cancelled’ is counter-intuitive, naïve and frankly grossly unfair to a system that already does so much with so little.

Oh and by the way. There's actually a third wall in this garbage compactor we call Canadian sport too - let's make it the ‘ceiling’ for the sake of symmetry. And it's the volunteers.

You hopefully read how significant they are earlier in this article. They provide more equivalent capital (through human capital) than the collective purchasing power of the rest of the entire sport system combined. Volunteers are somewhat hidden at national level in sport, where much programming in professionalized. But make no mistake. The volunteer is the life blood of community-level amateur sport, quietly filling the gaps that funding leaves open. And they’ve been taken for granted for too long.

The problems here are systemic, too. As I outline in one of my sport e-tutorials, 21st Century Sport Volunteerism, sport and recreation volunteer hours in Canada are down by 17.5% from 2004-18. Yet the number of people volunteering is up 7.6% over the same period. It means there are more volunteers but doing less.

The reasons for this are generational, related to changing ideological beliefs and societal culture. They are largely nothing to do with sport and much bigger than that. Millennials and Generation Zers aren't too keen on putting in the volunteer work their moms and dads did in past. Pop culture has driven a decline in moral expectations and societal responsibility to volunteer. We've seen a declining commitment to community well-being, particularly in Generation Z age groups.

In response, many sports organizations have introduced extra fees that you must pay if you don't volunteer. The trouble is, wealthy Millennials just shrug and pay the fee rather than volunteer. In this age of dual income households, time in the evening is far more valuable than a small penalty fee. So in trying to solve the problem by punishing people who don't volunteer, amateur sport is just giving people as easy ‘out' in letting them pay for their right not to participate. It also means we are now effectively paying volunteers and in danger of destroying that beautiful dynamic of helping out just for the sake of it.

In fairness, as the data shows, volunteers are absolutely still there. And the sport system hasn't done a good job of moving with the times in terms of what modern sport volunteers will and won’t do, and how to attract and retain them in this digital age. But there is a growing acceptance that the old volunteer-led model for amateur sports is sun-setting in the face of heightened consumer demands and requirements being placed on volunteers, particularly youth coaches. It's the third wall – the ceiling – crushing the system even further.

3) Nothing will change until enough funding can flow from NSOs to get the attention of PSOs and club-based community sport

So with this bleak picture painted, what to do? Well, one thing is very clear to me. The system will not work effectively as it is currently funded.

The Report makes mention of vertically aligning the system through mergers and shared services options. But the truth is those options have already been tried and have either had little impact or have failed. Indeed, Sport Alliance of Ontario, the multisport agency in Ontario that made it its business to provide shared services to Ontario provincial sport organizations (PSOs) went under in 2015, taking on too much risk providing shared administrative services including office space that their PSO members didn’t want or couldn’t afford. Sport Alliance’s counterpart in British Columbia, Sport BC, nearly followed it to the grave after Vancouver 2010, doing the same thing.

The fundamental issue is not inefficiencies in the structure of Canadian sport. It is simply that there is not enough money coming from the top to make a fragmented, wild west style system look up, take note and come to heel. Federal government and NSOs can threaten the system all they want with rules and punishment in breaking them. But the system knows it can shrug and say ‘what are you going to do about it?’ You see, rules and policies are unwieldy, blunt instruments to effect results, especially change. Banging the table with rules isn't the answer. Incentivization through proper funding is.

So how much does the system really need? The Report talks about bringing the system up to where it should be funded if inflation was factored in since 2005. But this only adds another $144m on what the system has now and doesn’t do anything like enough to account for funding gaps that make the system ineffective, as I have described.

My initial thoughts were that the current Federal envelope for sport needs to be doubled to at least $500m annually. And this happens to be line with what leaders in the system say. They estimate they need another $144m/year for high performance sport and a further $150m/year for support of general participation at community level. This, indeed, pretty much doubles the Federal government’s annual sport investment from the $233m/year now to the $527m/year leaders say is needed.

4) The Federal government can change the system to help fill the funding gap, not just throw more money at it

Sport shouldn’t be afraid to ask for this $527m in annual funding. After all, it’s nothing on what the user is collectively paying (and volunteering) and a mere rounding error on collective government spending on health and education in this country. But everybody knows that, at a time when government is fiscally focused on building houses and buying weapons, there is as much chance of Ottawa unilaterally agreeing to this funding enhancement as me scoring the winner for Canada at next year’s FIFA Men’s World Cup Final. So let’s talk sensibly here.

Johnny Misley is the CEO of Ontario Soccer. Ontario Soccer is a provincial sport organization, but it’s way bigger than most NSOs and the biggest recipient of government sport funding in Ontario. As a veteran of many sport leadership roles in Canada, including time at Own The Podium and Canadian Tire Jumpstart, Misley's seen all sides of this funding discussion.

‘Only 2% of Ontario Soccer’s revenue comes from government funding,’ Misley points out. ‘We are thankful for what we receive, but we are aware how much the system pays for itself and how government needs to play a stronger role. And there are important ways the Canadian government can help outside of just granting money that we know is not there in the volumes we need, under current fiscal policy direction.’

The first is obvious. Get sport out of minor ministries like Heritage and Arts and place it where it truly adds value, in health and education.

‘Sport should no longer be in some Ministry for Arts & Crafts’, Misley says, somewhat tongue-in-cheek. But he’s dead right. Sport is not about arbitrary play and national pride. It’s about betterment of Canadians that extends to life and death for some (more about that later). So it should be treated that way in the government’s ministerial priorities.

Another option – tax policy – has already been tried but needs to be rethought and reintroduced.

‘Target tax relief to where it is needed in amateur sport - helping those with financial challenges and incentivizing coaches to volunteer,’ notes Misley. ‘Make the tax credit 20% of sport expenses instead of 5% and target it at or around LICO definitions of financial hardship, that many financial assistance programs already run by community sports clubs employ.’

Misley also mentions making coach education costs tax deductible, which not only incentivizes volunteerism, but also helps with Safe Sport implementation as educational components of Safe Sport programming are built into the curricula of these courses. Fewer unqualified and unregistered coaches operating in sport surely creates a safer sport environment for all, no?

Two other important potential developments the Federal government can implement are well-noted in the Report.

Firstly, sport needs to be housed in a self-managing, self-directed Crown Corporation, where funding policies can be set on a long-term basis, without political interference and short-term thinking.

Secondly, money raised from licensed gambling activities at provincial/territorial level should be directed by this agency, so leveraged projects (where multiple levels of government contribute to a certain project, often on a matching basis) can easily be implemented.

And my final point to the government - Federal government money should primarily fund sustainable, long-term elements of sport, namely people and places.

‘People’ meaning not just Penny Oleksiak, but importantly Penny the Administrator. Fund administrative capacity, not just in NSOs, but into the governing bodies at provincial/territorial level. This is the most effective way to align the sport system vertically, believe me. When the people working within these organizations are all chasing the same goals, under the same paymaster then things get done, workflow improves and silly squabbles disappear. Covering this administration payroll then frees PSOs to invest in programming in their jurisdictions and drive value-add to their community club members, which shows genuine value-add for affiliation fees and gets community sport’s attention.

‘Places’, meaning facilities where people can play sports at all levels. There are already many fine examples of multisport facilities around the country that serve both recreational and high performance athletes in the community brilliantly. The Pan-Am Games Centres in Scarborough and Markham in the GTA are two fine examples of how you can get this done. As are multisport centres like RIM Park in Ontario’s Kitchener/Waterloo, Richmond Green in Richmond Hill, Ambleside Park in North Vancouver, Evraz Place in Regina and the amazing Abilities Centre in Whitby. These are tremendous facilities, that are true community hubs, used by thousands of Canadians and accessible to all. We just need more. Imagine if we have dozens of these, all around the country, serving athletes of all persuasion for decades to come? Now that’s investment in Canadians any government can be proud of.

So there it is. I obviously haven’t given all the answers here, nor touched on everything noted in the Report. For example, I haven’t made reference to the many multisport organizations in the Canadian sport system, or disability and Paralympic sport, where the argument of integration with conventional sport or not has been raging since I’ve been working in the system (over 20 years) and I still have no answer for it. But this article is in danger of reaching the word count of the Report I’ve been commented on, if I’m not careful. So I’ll close with this final thought.

What about if we were genuinely ambitious for sport? Not for what sport can receive, but for what it can give?

We’ve known for years that sport makes us physically active, teaches kids good values and is a lot of fun, particularly when Canada does well at an Olympic Games or other world sports event. But are we really unleashing its true value?

Covid-19 actually helped the Canadian amateur sport system in many ways. The Canadian Amateur Sport Health Check Report that Capitis Consulting developed and issued in 2022 showed that, thanks in a big way to Federal government emergency funding measures, amateur sport was able to bounce back pretty well from the pandemic. But what we learned from that chaotic time was extremely valuable, not least what a crucial and central role sports plays in the lives and minds of so many young Canadians. Taking sports away from our kids brutally exposed how much sport participation contributes to youth mental health. We understood that our youth sport coaches and effectively volunteer social workers. But importantly, we gained clinical and scientific data to back this up and not just throw it out as easily-debunked, anecdotal claims.

Let me ignore the benefits we know sport brings to the youth criminal justice system, integration of newcomers to Canada and early New Canadians and the gluing together of Canadian communities, particularly in rural areas. Let’s just look at the healthcare question.

Covid-19 showed us just how fragile and at-breaking-point our healthcare systems are in Canada. Many could not handle the tsunami of medical needs the pandemic threw at them, and some have not fully recovered, particularly in terms of human resource needs in frontline workers. I’ve listened to experts in government talk for decades about the ‘tipping point’ that government will reach, where it can no longer afford the healthcare services our population needs. The model of continuing to build a bigger and better healthcare system at the taxpayer's expense will simply no longer be viable. The numbers will no longer add up.

Covid-19 has brought us to this tipping point and we don’t need a government guru to tell us this. So surely there is only one option to pursue. We have to start keeping people out of hospitals, rather than expanding ways to treat them when they are in. Preventative healthcare has to move from arbitrary healthy living advertising and social programming to genuine action, as part of the healthcare budget, using instruments that can develop healthy people who only visit hospitals to work or visit people, not lie in hospital beds.

What instrument can do this?

Mr Carney, I present to you the Canadian amateur sport system. Do this. Commit 1% of the 2025/26 Canada Health Transfer to amateur sport for the next 20 years. That’s $547m – close to what we’ve identified we need. Measure Canada’s patient intake levels (particularly related to cardiovascular disease, which kills nearly half of us in this country). Let’s come back in 2045 and see how we’re doing. I am convinced the results will be eye-opening.

Don’t say we can’t do this, don’t say we can’t fund this. We can. We are just choosing not to. Prioritize sport. Make it the incredible executor of public policy on simultaneous multiple levels that it can be. Have the courage to fund it properly. The current systems - both healthcare and sport – aren’t working. It’s time to think and act freely and try new, innovative options to deliver government in this modern age. The Canadian amateur sport industry is ready to get to work making this a reality, if you do.

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Paul Varian is the President of Capitis Consulting Inc., a boutique management consultancy focused on adding value in and around the amateur sport Boardroom, author of Amazon #1 Best Selling Sport Management Book ‘Don’t Blame The Soccer Parents’, and host of amateur soccer management podcast The Regista Room. Subscribe at www.capitislearning.com and follow Paul on LinkedIn at Paul Varian.