- with Senior Company Executives, HR and Finance and Tax Executives
- with readers working within the Accounting & Consultancy, Healthcare and Technology industries
In June of this year, the Ministry of Education (the "Ministry") took charge over four school boards in Ontario. Orders-in-Council were issued for the control of Ottawa-Carleton District School Board, Toronto Catholic District School Board, Toronto District School Board, and Dufferin-Peel Catholic District School Board, and supervisors appointed to administer their affairs.1
In this article, we will review the legislative mechanism and requirements for the Minister of Education (the "Minister") to seize control of a school board, how a school board regains control after one of these orders is issued, and how the proposed Bill 33 currently proceeding through the Ontario legislature would further empower the Minister to take control of school boards. This article is to help trustees, school administrators, and anyone who is interested in the governance of their local school board understand the takeover mechanisms found in Ontario's Education Act (the "Act").2
As will be described below, these takeovers are not merely administrative in nature. The Minister (or the Minister's appointed supervisor) is able to direct all affairs of the board, and there are few options for a board to regain control. The true result is that trustees lose the control they were elected to exercise, and boards lose autonomy to govern their own affairs.
The takeover mechanism in the Act applicable to these school boards
In all four of these circumstances, the Minister had ordered investigations into the financial affairs of the board pursuant to section 257.30(1) of the Act. The Act allows the Minister to direct an investigation, and appoint an investigator, who may be either a Ministry employee, or an individual or corporation authorized under the Public Accounting Act, 2004.3
The investigator must provide the Minister with a written report on the results of the investigation, which must also be provided to the secretary of the board.4 The investigator may recommend that control of the affairs of the board be vested in the Ministry5 if they find either:
- Evidence of financial default or probable financial default.
- An accumulated deficit or a probable accumulated deficit.
- Serious financial mismanagement.
Upon reviewing the report prepared by the investigator, the Minister may give any directions to the board to address the board's financial affairs.6 If the investigator's report recommends that the Ministry take over the affairs of the board, the Lieutenant Governor in Council is permitted to make any order necessary for the Ministry to take control and charge over the administration of the board.7 This order gives the Minister very broad control over "any matter in any way affecting the board's affairs."8
The number of takeovers the Minister pursued this summer is unprecedented. Aside from the four school boards taken over in June, mentioned above, a fifth order-in-council was issued for the takeover of Thames Valley District School Board earlier in April of this year.9 These five takeovers under section 257.31(2) of the Act are the only of their kind to occur in the past nine years.
The Minister has sent a clear message that he intends to exercise his powers under the Act, and additionally, has proposed a bill which would further expand his ability to take charge of school boards. Boards and trustees, who already have very strict requirements to meet under the Act, will need to ensure that they are diligently avoiding the circumstances which would lead to the Minister exercising his takeover powers.
How a board regains control
Unfortunately, once a s.257.31(2) order is issued, regaining control is largely out of the hands of the school board. The Minister and the Lieutenant Governor in Council have discretion to review, confirm, amend, or revoke their orders at any time, but are not compelled to do so.10 The Lieutenant Governor in Council is only compelled to revoke a s.257.31(2) order if either:
- They are of the opinion that the affairs of a board no longer need to be administered by the ministry.
- If the annual financial statements and auditor's report for a fiscal year indicates that the school board did not have an accumulated deficit for the fiscal year.11
The Act does not give rise to any mechanism for school boards to appeal a decision of this nature. A board's only real option is judicial review, which is available to review decision-making power of a state actor. The field of judicial review is very complex, and outside of the scope of this article, but suffice to say, due to the scheme of the Act empowering the Lieutenant Governor in Council with exclusive, unreviewable jurisdiction over such orders, and the amount of discretion amounted to them and the Minister, it seems it would be very difficult for a board to achieve a favourable outcome upon judicial review.
Bill 33 proposes sweeping power for the Minister to take over boards
Bill 33 is currently making its way through the Ontario legislature, and is at the debate stage of the second reading.12 When the legislature returns on October 20, they will resume debate.
Bill 33 proposes broad changes to the Minster's powers under the Act to investigate and take over school boards.13
The provisions that applied to the school board takeovers discussed in this article are found in Part 9 of the Act. The relevant sections in Part 9 of the Act specifically deal with the supervision of board financial affairs. Bill 33 does not propose to change these sections, but does propose substantial changes to Part 8 of the Act, which deals with investigations and subsequent takeovers related to school boards complying with their other obligations under the Act.
Under the current Part 8 regime, if the Minister has concerns that a board has contravened certain sections of the Act or its regulations, the Minister can order an investigation. When doing so, the Minister must specify which legal requirements of the board are in issue.
If the investigator's report discloses evidence of contravention of the Act, the Minister can give any directions he considers advisable to address the non-compliance. Only if the Minister is later of the opinion that the board failed to comply with their direction, can they advise the Lieutenant Governor in Council, who then has the power to make an order for the Ministry to take control and charge over the board.14
The Lieutenant Governor in Council is compelled to revoke such an order once satisfied the board is back in compliance with the Act.15 The board can also apply to the Divisional Court for revocation of the order, which the Divisional Court must grant if it is satisfied the board is in compliance with requirements under the Act.16
The proposed changes to Part 8 broaden the Minister's power significantly. First, it would empower the Minister to order an investigation into a school board for any concern about "a matter of public interest."17 Matters of public interest are defined as whether boards are carrying out their duties in an appropriate manner, and any other matter that may be prescribed.18
It would also give the Minister broad power to issue directions to the board if, in the opinion of the minister, a board, board member or director of education has done something or is likely to do something that could affect a matter of public interest.19
Under the current Part 8, it is the Lieutenant Governor in Council that issues orders for the Ministry of Education to take over a school board. Bill 33 would give the power to issue such orders to the Minister themself, and expands the reasons they can give such an order vesting control to the ministry to include either:
- If the board has failed to comply with a direction given under section 230.2 within the time specified in it.
- If, in the opinion of the Minister, a board, board member or director of education has done or omitted to do something, or is likely to do or omit to do something, that could affect a matter of public interest.
- Any other circumstance that may be prescribed.20
The bill gives the Lieutenant Governor in Council the ability to make regulations about what these other prescribed circumstances would be.
Bill 33 would give the Minister exclusive jurisdiction to make such orders, and says that their jurisdiction is not reviewable.21 Additionally, the only circumstances in which an order must be revoked is if the Minister is of the opinion that the affairs of the board no longer need to be administered by their Ministry.22
Currently, an order made under this part of the Act must be revoked if the cabinet is satisfied that the board is complying with its obligations under the legislation. The new section 230.17 essentially gives the Minister sole discretion to decide when an order should be revoked, and also removes a board's ability to apply to the Divisional Court to revoke a Part 8 order.
Summary
An unprecedented number of school boards have been taken over by the Ministry this year. As other school boards begin to struggle with their own accumulated deficits, they run the risk of also being brought under the Ministry's purview.
The Minister has proposed Bill 33, currently making its way through the Ontario legislature, which would increase his power to take control of boards. The legislature will resume its debate on the Bill this coming October 20, so it would be wise for concerned trustees or administrators to monitor its progress closely.
The changes Bill 33 would make to certain sections of Part 8 of the Act are summarized below.
|
Current Part 8 Regime |
Bill 33 Proposed Changes |
|
|
When the Minister can order an investigation into a board |
When there are concerns that the board has contravened certain sections of regulations under the Act. The Minister must specify which legal requirements of the board are in issue. |
When there are concerns about "a matter of public interest", defined as whether boards are carrying out their duties in an appropriate manner, and any other matter that may be prescribed. |
|
When the Minister can issue directions to a board |
If the investigator's report discloses evidence of contravention of the Act. |
If, in the opinion of the Minister, a board, board member or director of education has done something or is likely to do something that could affect a matter of public interest. |
|
Reasons the Minister can initiate a board takeover |
Only if the Minister is of the opinion that the board failed to comply with their direction, can he then advise the Lieutenant Governor in Council to issue an order. |
If 1) the board has failed to comply with a direction given under section 230.2 within the time specified in it, 2) in the opinion of the Minister, a board, board member or director of education has done or omitted to do something, or is likely to do or omit to do something, that could affect a matter of public interest, or 3) any other circumstance that may be prescribed. |
|
Takeover mechanism |
The Lieutenant Governor in Council issues an order on the advice of the Minister. |
The Minister themself would make the order. |
|
Revocation of an order |
Such an order must be revoked if the cabinet is satisfied the board is complying with its obligations under the Act. |
Such an order must be revoked if the Minister is of the opinion that the affairs of the board no longer need to be administered by their ministry. |
|
Appeal route |
Boards can apply to the Divisional Court for revocation, which must be granted it the Court is satisfied the board is in compliance with requirements under the Act. |
None. |
Footnotes
1 Ontario, Order in Council O.C. 865/2025 (June 26, 2025); Ontario, Order in Council O.C. 866/2025 (June 26, 2025); Ontario, Order in Council O.C. 867/2025 (June 26, 2025); Ontario, Order in Council O.C. 868/2025 (June 26, 2025).
2 Education Act, R.S.O. 1990, c. E.2
3 Ibid, s 257.30(2).
4 Ibid, s 257.30(5).
5 Ibid, s 257.30(6).
6 Ibid, s 257.31(1).
7 Ibid, s 257.31(2).
8 Ibid, s 257.33(1).
9 Ontario, Order in Council O.C. 444/2025 (April 23, 2025).
10 Education Act, ss 257.40(2) & (4).
11 Ibid, s 257.50.
12 Legislative Assembly of Ontario, "Bill 33, Supporting Children and Students Act, 2025", online: (https://www.ola.org/en/legislative-business/bills/parliament-44/session-1/bill-33).
13 Bill 33, An Act to amend various Acts in relation to child, youth and family services, education, and colleges and universities, 1st Sess, 44th Leg, Ontario, 2025 [Bill 33].
14 Education Act, ss 230(1), 230.2(2), & 230.3.
15 Ibid, s 230.17(1).
16 Ibid, s 230.17(2)-(3).
17 Bill 33, cl 230.1(1).
18 Ibid, cl 230(1).
19 Ibid, cl 230.2.
20 Ibid, cl 230.3.
21 Ibid, cl 230.7(3).
22 Ibid, cl 230.17.
Read the original article on GowlingWLG.com
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
