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Changes coming for Social Services in procuring hotel rates

Minister Gene Makowsky says a pilot project to procure hotels, and a formal process to obtain quotes, will be instituted.
Minister Gene Makowsky speaks to reporters Feb. 9 on changes in obtaining hotels for Social Services clients.

REGINA - Minister of Social Services Gene Makowsky is pledging updated procedures for securing hotels for Social Services clients in the wake of the Sunrise Motel controversy.

Makowsky addressed the changes at the same time that the government released information on the ministry’s hotel use policies as well as information on costs, as was requested by the Official Opposition.

The policy changes announced by Makowsky are as follows: the Ministry will implement a one-year pilot project and publicly procure a block of

five rooms in each of Regina and Saskatoon through an RFP process. The rooms will be procured at a confirmed rate, as well as provide a damage deposit guarantee for each stay. 

Up to now, the Ministry typically did not pay for damage deposits for hotel stays for its clients, so this is a change. This is a one-year pilot project, which the Ministry states will allow them to evaluate cost-effectiveness of this approach.

The other change is that a formal process by Social Services will be put in place where the ministry or third-party-contracted providers obtain quotes from at least three hotels when booking a room for an individual or family in Regina, Saskatoon, Prince Albert, or Moose Jaw. Caseworkers will direct individuals to the lowest cost hotel, but Makowsky emphasized that the client‘s safety needed to be foremost in the consideration.

“Hopefully we can get rates,” said Makowsky, but he said that “the first thing the ministry considers, the individual caseworkers consider, is the safety of the client first and foremost, and that always has to be at the top of the list of what currently is now in terms of considerations of hotel rooms.”

Makowsky also says his ministry is continuing to work with the provincial auditor in this matter, and says if they have any ideas of processes they would like to see, that those will be “absolutely” considered, and looked at very closely.

In speaking to reporters Makowsky said the existing policies had been in place a long time, “previous to even this government. So it may be a time to take a look at it since a light was shone on it.”

The issues over Social Services spending on hotel rooms erupted last fall when a Social Services client was booked into the Sunrise Motel in Regina, owned by Regina Northeast MLA Gary Grewal. The controversy ensured when the motel was accused by the opposition. of hiking its rates soon after the client checked in, with Grewal accused of a conflict of interest. Grewal, for his part, maintained he had not been involved in the management of the motel. 

Makowsky was hopeful that having an RFP process, with damage deposits in place, would help keep rates competitive and perhaps attract a few more hotels who might be willing to take on social assistance clients — something that is also an issue. It was noted that in Regina they were down to three hotels or motels willing to take Social Services clients.

Also released were numbers for hotel expenditures going back five years. They show total hotel expenditures for Income Assistance and Child and Family Programs consistently going up from 2018 to 2023, from $1,166,605 to $2,725,795 in 2021-22 and $3,076,235 in 2022-23. For 2023-24, numbers for April to September were reported and those came to $1,584,658.

For Sunrise Motel alone, the numbers started to jump in 2020 from $1,027 up to 12,931, then up to 37,041 in 2021-22 and then $220,474 in 2022-23. For April to September 2023, the amount was $110,887.


Critic Meara Conway accuses government of misleading public

In an NDP news conference soon after, Social Services Critic Meara Conway accused Makowsky of having “misled the public on a few key points in the wake of the Sunrise Motel scandal.”

Gene Makowsky is on the record more than once as claiming that the reliance on hotels by his ministries was trending downward, that it was going down… These numbers show inconvertibly, but that is false. There is a clear and consistent trend upwards, not a slight trend upwards, it’s a significant trend upwards.”

Conway also pointed to the “total absence to this concept of not paying a damage deposit. That concept has disappeared.” She said it was Minister of Social Services pointing to damage deposits as the reason why Sunrise Motel had hiked their rate to over $200 a night.

“You will recall that their justification for that is that they have a policy of not paying damage deposits. Not only does that concept not appear in these documents, they cannot produce a single policy speaking of that, it doesn’t appear to exist, and so I can only draw the conclusion that the Minister of Social Services misled the public on that front with the hopes of quashing this story.”

Conway also noted that government payments to the Sunrise Motel had “jumped significantly” since Grewal was elected in 2020. She noted the Sunrise Motel only received $282 in business from the Sask. Party government in 2018-19, but by 2022/2023, the motel received over $220,000 and were on track yet again for a similar year in 2023/2024.

Conway also noted the financial information released for 2023 stopped at September, and did not include the period after that when the Sunrise Motel controversy erupted. She accused the government of “not wanting us to see what that information will show.”

Conway said they would have more to say on their Freedom of Information requests next week.