Here is the explanation the funding agency uses:
https://www.nserc-crsng.gc.ca/_doc/EDI/Guide_for_Applicants_...
Putting on my 'dealing with faculty and grantsmanship' hat, I would bet good money he was confrontational in his application and that more than anything was why it didn't get funded. There are definitely faculty out there who don't get funded simply because they are too difficult to deal with.
In parallel, no one is going to check or hold you accountable on these things and they list the criteria. They don't hide it, its right there. They are the funding agency, the government directs them to set priorities and policies and they did. Stating up front that you believe their policies and priorities are stupid is not a great way to get anyone to give you money.
He's just participating in performative nonsense.