OGGO Committee Meeting
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Standing Committee on Government Operations and Estimates
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EVIDENCE
Tuesday, December 10, 2013
[Recorded by Electronic Apparatus]
[Translation]
Good afternoon, everyone. Welcome to the committee's ninth meeting.
As our agenda indicates, we will first hear from Mr. Sobrino and Mr. Gray, from the Department of Public Works and Government Services. They will speak to the mandate and activities of the Build in Canada Innovation Program.
You have 10 minutes to make your presentation. The committee members will then ask you questions.
Thank you for joining us today. Without further ado, I give you the floor.
[English]
Good afternoon.
I'm very pleased to reappear before you today to discuss the Build in Canada innovation program, which was known as the Canadian innovation commercialization program the last time I appeared.
I am Pablo Sobrino, the associate assistant deputy minister for the acquisitions branch at Public Works and Government Services. I am accompanied by Mr. Desmond Gray, the acting director general who's overseeing both the office of small and medium enterprises and strategic engagement, as well as the services and specialized acquisitions management sector of the acquisitions branch.
The Canadian innovation commercialization program, or CICP, was launched as a pilot program in Budget 2010. It was created to bolster innovation in Canada's business sector. The program helps companies to bridge the precommercialization gap by procuring and testing late-stage innovative goods and services within federal departments and agencies. The feedback they receive during testing helps businesses to move their innovations to the marketplace.
For a small pilot, the CICP was well received, with 967 proposals from businesses across Canada and 84 innovations prequalified for testing.
[Translation]
The program has also seen support from other parties, including this committee. An Office of Greening Government Operations report released in November 2011, entitled “Effectiveness of the Office of Small and Medium Enterprises and the Canadian Innovation Commercialization Program”, recommended that Public Works and Government Services Canada consider making the program permanent.
In addition, an expert panel on research and development, chaired by Tom Jenkins, also recommended making this program permanent as part of their October 2011 report entitled “Innovation Canada: A Call to Action”. The report, which examined how to strengthen the impact of federal investments in support of a more innovative economy, further noted that programs such as the CICP could be used to develop capabilities essential to Canada's emerging defence and security needs.
[English]
Following these recommendations, and to build on the early success of the pilot program, budget 2012 committed to making the program permanent and to adding a military procurement component, which will be phased in gradually. By 2016, the program will be allocated $40 million annually, with funding split evenly between the standard and military components.
The permanent program was renamed the Build in Canada innovation program, or BCIP, to better market the program to Canadian businesses and government departments. The BCIP will continue to work with Canadian businesses to match their innovative goods and services, with federal departments and agencies to provide testing and feedback.
[Translation]
I would now like to take a moment to briefly outline some of the details of the program.
[English]
The program employs an open approach to its calls for proposals, referred to as a “supply push” approach, with broad priority areas allowing Canadian businesses to propose an innovation without specifically knowing where it will be tested. This approach is effective because businesses are able to propose an innovation based on its features and benefits rather than strictly in response to a pre-identified need. This is particularly beneficial to small and medium enterprises as well as to businesses in regions where government does not have a large presence, because they do not need to possess extensive knowledge of government and its needs in order to participate in the program.
[Translation]
The four broad priority areas of the standard component of the program are the following: environment, health, safety and security, and enabling technologies. The newly added military component, which was introduced in the fourth call for proposals that launched on November 21, includes a single priority area—protecting the soldier. As the military component is phased in over time, and its budget expands, future calls for proposals will introduce additional priority areas.
[English]
The competitive call for proposals process requires Canadian businesses to submit information on their innovations, their business plan, and their testing requirements. The evaluation process is completed in three stages.
The first stage of the evaluation is completed by Public Works and Government Services Canada and serves to verify whether each proposal is in compliance with the mandatory criteria. These include whether the business is Canadian; whether the proposed innovation includes 80% Canadian content and is at the appropriate stage of development for the program; and lastly, whether the proposal is under $500,000 for a standard component, and under $1 million for the military component.
[Translation]
Compliant proposals move forward to the second stage of the evaluation, which involves reviewing the following: the technology's level of innovation; the company's business plan; the innovation's marketing plan, and the benefits of the innovation to Canada.
This stage of the evaluation is carried out by the experts of the National Research Council's Industrial Research Assistance Programs—IRAP. Upon completing their evaluations, the IRAP experts provide Public Works and Government Services Canada with a ranking of proposals from the highest scoring to the lowest.
[English]
The third stage of the evaluation is completed by an innovation selection committee, comprising mostly private sector experts with relevant experience in innovation and commercialization. The selection committee reviews the top-ranked proposals to validate the conclusions of the second stage of evaluation.
This committee's 2011 report noted a concern with the membership of the committee and the level of access it has to businesses' information.
In response, our department has introduced a number of measures to ensure the integrity of this committee.
[Translation]
First, we have integrated entrepreneurs-in-residence from universities across Canada into the committee's membership to provide a balance of academic and private sector expertise. Entrepreneurs-in-residence are executives that bring real world business expertise to academic programs. They bring a unique perspective that balances private and public interests.
Second, to protect bidders' information, members of the selection committee are required to sign non-disclosure and conflict of interests agreements.
Third, members are required to recuse themselves from reviewing a proposal should they feel there is a real or perceived conflict.
[English]
Following validation by the selection committee, PWGSC selects the highest-ranked proposals based on available funding for that call for proposals. These bidders are notified of their pre-qualification and then we begin to search for a federal department or agency to test, evaluate, and provide feedback on their innovation.
To support this search the program works with pre-qualified businesses to identify potential test departments and to facilitate communications.
For innovations submitted under the military component of the program there will be a defence validation committee of personnel from the Department of National Defence, who will help to identify the most suitable organizations within their department to carry out testing.
Once a pre-qualified innovation and a test department are matched the contract negotiations begin and the specific details of testing are worked out between the business and the applicable department. In some cases negotiations will take into account the size and scope of the proposed test and the capability or capacity of the department to accommodate it.
The final step is issuing a contract that defines the final cost, the timelines, and expected testing outcomes. It is important to note that not every pre-qualified innovation is guaranteed a contract. Contracts are only issued when a test department is identified and terms of the contract can be agreed to.
To date we've awarded 67 contracts to Canadian businesses.
That concludes my presentation. We'd be happy to answer any of your questions.
[Translation]
Thank you for your presentation.
We will now move on to questions from committee members.
Mr. Martin, you have five minutes.
[English]
Thank you, Mr. Chair.
I'll take the first round. I may not use my entire five minutes. I'm interested in the development or the progress of what was the Canadian innovation commercialization program and what seems to be a creep or drifting, if you will, of its focus towards the military.
There's one comment I'd like you to flesh out a bit. You say the funding will be split equally between the military and the other priorities. Does that mean 50% for the military and 16% for each of the other three, or 25% each in your four categories of priority?
From the total program, 50% will go to the military and the other 50% across the standard components.
I guess I'm wondering about the rationale and how this develops. The last thing the world needs is more people building weapons.
The military industrial complex is pretty well served by some big actors. I'm just wondering how throwing $1 million at a start-up arms builder in Canada is going to be able to compete with Raytheon. I had to look up a phone number at Raytheon one time, and there's 80 pages in their phone book of people and departments, etc.
So my first question is, what is the rationale behind trying to jump into the arms race?
Second, what obligation is there to buy Canadian afterwards? My experience with the Canadian military buying Canadian has been appalling.
Let me give you an example to help you answer this question. The Canadian military needed some troop carriers, and Winnipeg arguably makes the best buses in the world. They needed 32 new buses and they ended up buying Mercedes-Benz ones, even though they were was less than half a percent cheaper. This was a big contract—a $15 million or $20 million contract. For less than the price of a set of tires, they decided to buy German and send a message to all of our NATO allies that if you want a good troop carrier, don't buy Canadian, buy German; that's what we do.
There's no buy Canadian component. Aren't we setting these companies up for failure in trying to convince them to build guns and arms here, when we take the lowest bid at all costs? Has that apparent contradiction been thought through?
I really can't comment on that contribution to the military industrial complex. What I can speak to is the rationale behind having a military component.
When the Tom Jenkins' report on innovation came out, and given our experience with the CICP...there have been a number of components under the security component that were really military-type applications, and it was a military testing department.
One of the issues that comes up is that—
Can you give me an example, Mr. Sobrino, of the type of applications you are getting that are more military than security?
One of them was a paint coating that was more environmentally friendly. A company out of Montreal had an innovation or had the view that they could use that paint coating for fighter aircraft. That was one example; we could pull out some other examples.
However, the idea is that the innovation had a military application. The opportunity provides these small companies, who really have not commercialized their products, to test their innovations and make a first sale—which is the main driver of this program—to the Canadian military. That's very useful for them as they develop their market. That is one piece.
The reason the value of it is up to $1 million instead of $500,000 is that most of the innovations that have a military application require quite a bit more development work to fit military specifications.
I would argue that health innovation is necessarily expensive too and needs a lot of support.
I guess what I'm getting at, without being critical, is my concern about the emphasis. Some 50% of the whole program going into a new upstart military section, and the other four categories have to argue amongst themselves for what's left. That includes the environment, health, and enabling technologies. These are important areas of research as well.
The value of the program is not diminished in any of those areas; it's the same program we had before. The government has added to the approach, up to an additional $20 million a year, which will be used to focus on military innovations.
[Translation]
[English]
Thank you, Mr. Chair.
Thank you, Mr. Sobrino and Mr. Gray.
Mr. Sobrino, welcome back to the committee. It's good to see some progress in this program. We looked at the CICP two years ago, and there was some very positive feedback from some of the Canadian enterprises. Some of them were very small businesses that didn't even have cashflow, and yet they were talking about how this program was really effective. It gave them that springboard. It gave them that endorsement from the federal government to allow them to sell to other customers within Canada and even internationally. There was truly some success.
I think we have a lot of programs to foster innovation. We all know that's the future for our economy. It's not based on competing on the lowest prices, necessarily, but on being innovative and on being differentiated. If you look at things like research grants, and research chairs in universities, and tax credits, and the new venture capital fund, these end up adding up to billions of dollars. This Build in Canada innovation program is actually a very small program as compared with those other ones.
Could you talk about how this is different from those other things? How is this different from putting money into venture capital or putting money into research grants?
This is a program that works at the pre-commercialization phase. This is not a program to help a company access those kinds of funds. It is to take a company, when you divide the development of the technology or development of innovation, to kind of the final stages of that development.
Really, one of the reasons we changed the name of the program is that this commercialization piece is not what the program does. It is a pre-commercialization piece.
The program is there to take an innovation, an invention that is now functioning, and see whether it is suitable for testing within government. The reason we have that request from small and medium enterprises that do this kind of work is that a government buy, as your first buy, is the best tool to get you to venture capital commercialization and investment by interested investors, as well as sales abroad.
For many of these companies, they're interested in developing an export market. This is where they really want to push their innovations, some of which, of course, are things that can be delivered in Canada. Many are looking for export markets.
For example, we have one company back east that was working on a sensor for detecting oil droplets in water. Based on the work they did with, I believe, the Department of Fisheries and Oceans, and the testing they did and the successful use of the technology—they adjusted the technology based on those tests—they were able to develop a market in the oil business in the Gulf of Mexico to help with the detection of oil in the environment. Their business has increased. They're actually out there now, delivering.
So what we're doing is providing a place, a venue, where you can actually sell your first product, test it, maybe improve on it, and make it more available. That sale helps you in terms of marketing your innovation abroad.
Thank you very much.
The whole process is different from traditional government procurement, where a department would identify certain needs, put together an RFP, go out to the market, get different bidders to compete, and then eventually get to a contract. Here we're looking at some products that actually exist, and the question being asked of the government is whether they can use it, or whether there's an application for it in their area of need.
What kind of screens do you have in place to ensure that the government isn't buying things it doesn't actually need? You know, somebody might be enchanted by some new and innovative technology, but they might not actually need it. How do you ensure that?
This is one of the issues that has been raised about the program. We're there to make that one sale, to assist a company that has an innovative idea; whether we actually end up wanting to buy it is a decision the government will have to make.
The interesting piece is that once you have sold it and it now commercializes, you enter into the normal procurement world. You're not designated particularly. Certain rules might apply in the future, but generally that product's available on the market.
When you first get that, you do the testing. The testing department has to have some interest in the piece. They participate in developing that test to assess the equipment.
The next thing they have to do is to decide whether they could actually use that application in the future. In a number of cases, they have said, “Thank you very much. That's not something we will use in the future. We're glad to have tested it”. That is part of the process of introducing innovations; either you can use it or you can't.
We've had some surprising success in that some of those innovations have actually moved on to regular procurements for government, but in a lot of cases that innovation is then marketed commercially as opposed to within government. It's not that we're testing something useless. The program is about buying something and helping that innovator assess whether it's a useful thing. It's very much in the R and D world and not in the commercial procurement world.
If I could just add one comment, I think it is very instructive to look at some examples. It's very interesting how this program has such a profound impact.
I can give you an example. We had a company that had offices in St. John's and Victoria. They had a product that was called a marine training simulator, which allows them to do a high-speed rescue craft simulation, just as you would do for aircraft, but for boats. Of course, the Canadian Coast Guard and Fisheries and Oceans were very interested in this, because in and of itself it's a very cost-effective way to test the functionality of these crafts.
What was very interesting is that this company was prequalified into the program before we had actually evaluated their product, before it had even come in, because of the fact that other companies had heard that the Canadian Government was putting them into this program and in a sense was purchasing this and giving this opportunity. They had four additional international contracts almost immediately. This is the leveraging power of the confidence of the Government of Canada in buying these products and services. It's instructive, not just to the businesses here, but also to companies, to leverage this internationally. This was very effective.
[Translation]
Thank you, Mr. Chair.
Thank you for joining us. I want to take this opportunity to wish happy holidays to you and your family, as well as to all public service employees who are working extremely hard, be it for us or for Canadians.
I will continue in the vein of the questions asked by my colleague Pat Martin, the NDP critic for this committee. He talked about the military component. You said that $20 million was added to the military component and that this accounted for 50% of the total. We can assume that a $20-million amount was allocated to the standard component, for a total of $40 million.
Research, development and innovation in the military field have helped develop tools that are just as practical in everyday life—such as the laser used in surgery. That is a very innovative field.
Besides that $20-million amount, was any other funding allocated to the military, or was that amount simply transferred from another department to this one, which our committee is responsible for studying?
It is an additional amount that comes from the finance minister's budget. The $20-million amount is an addition.
This request does not come from the research team of the Department of National Defence. This amount is set aside to allow private sector innovators to present their innovations to the military. The military is not asking for that money. The money is intended for private sector innovators who have ideas to present to the military for testing.
It was not being done in this way. This program's objective is to encourage the private sector to propose innovations to the government.
I explain this program in public hearings by saying that the innovator presents their idea to me for evaluation. Then I determine whether the idea is suitable or whether it can be improved. This program follows a pattern that is sort of the opposite of the usual practice. In the government, needs are assessed and innovations are found to meet those needs.
Our department, Public Works and Government Services Canada, does. This is our program, and we take care of the supply. So the funding comes from Public Works and Government Services Canada.
No. We buy the innovation. We could transfer it to the military if they want, but we receive the funding.
I do not buy any goods. These salaries are part of my budget. However, in my supply budget, I sometimes have goods valued at $150,000. Those are innovations we have purchased.
There are four components, in addition to the military one.
Can you tell me how priority areas are selected?
In 2010, when the program was created, the following four components were established: the environment, health, security and accessibility. At least that is what I think they were. Mr. Jenkins' study indicated that, in the sector involving innovations in security, the demand for prioritizing military projects was strong. Therefore, the department proposed not to transfer funds already intended for innovation within the four components, but rather to add resources to facilitate innovation in that sector. Mr. Jenkins supported that idea.
The program was implemented through budget 2010. It was said that there were some shortcomings in the innovation pre-commercialization stage.
Is that still the case?
Yes. In Canada, many small and medium-sized businesses have difficulty going from invention to commercialization. That gap is still there, and that is why the program exists.
[English]
Thank you, Mr. Chair.
Again, thanks to our witnesses.
Like my colleague Mr. Trottier, I was here for the report.
Let me just try to clarify, first of all, the rationale for changing the name. You mentioned something about commercialization. Maybe you could clarify the thought process that went with the name change.
On the name changes and the original name, it was called the Canadian innovation commercialization program. As for what that did, businesses that came to apply often asked us if the program would help them in marketing, in raising investment funds and things like that. There are other programs in government that do that kind of work, and it really is about commercializing.
Our program really operates in the pre-commercialization phase, between the invention and actually getting to that point. We realized this fairly early on in the program, so that was one of the main motivators to recommend that we change the name of the program to remove the word “commercialization”. There were many versions that went forward, but “Build in Canada innovation” is trying to describe what the program really is, which is innovations built in Canada that we access, or that they're able to access.
Yes. They have the small business innovation program there. It's on a different scale. They are a much bigger program, but yes, it's the same idea.
In your opening comments, you referred to Mr. Jenkins. That's Tom Jenkins, who chaired the report “Canada First: Leveraging Defence Procurement Through Key Industrial Capabilities”, presented in February of this year. I've met with some of the manufacturers who are on the Hill today and were here yesterday, and what has been alluded to is that Canada has been really good at universities and R and D, but we haven't taken the concepts to commercialization, that we have trouble with that.
When you are working with these innovators, which defence.... I have companies called ArmorWorks and Kelowna Flightcraft in aviation. They are not normally known for.... I mean, they're conservative in nature, and there's nothing wrong with that, by all means, but the fact is that when it comes to defence, they don't necessarily want to be the leading edge. Is this R and D program helping to take that edge out of defence, so that they can help commercialize with the assistance of the federal government?
That's precisely it. Some of those companies have applied to our innovation program, and they are taking their invention or innovation and through this program are getting government to buy it, test it for them, and prove it. That takes them over the hump from invention to having a commercially viable product. That's what we hope is the outcome.
The other thing I might add for the members is that for many of these R and D programs, we expect that innovations will have a fairly high failure rate. It is the nature of innovation that among the successes there are some failures, partly because of the interests that we have in this and also the level of screening that we're doing with both the IRAP evaluators from the National Research Council as well as the private sector committee. We're having good success in identifying winners. It's too early to tell if that's an ongoing thing, but we're seeing very good results out of the program that way.
I'd just like to add one thing and use real world examples, because I think they're very instructive of how these things take place. Referring to the earlier question about DND, we had a company that brought forward an innovation. It was a company called 2G Robotics. Their innovation was the ULS-100, which essentially is an underwater laser scanner. This was brought in. DND sponsored it through Defence Research and Development Canada.
It was very interesting. They brought in this product. Initially it didn't perform according to the specifications, but of course the process is that we just don't fail it. We work with them. They come back again. They tweak their product. That's what this kind of thing does. It allows you to refine the product, bring it back, and make it work. That's the goal.
What was very interesting in this case is that they did bring it forward. This product was brought over for the Costa Concordia, which as you know foundered off the coast of Italy, and this product has been used to scan and help with the salvage of that ship. This technology was regarded as leading edge for this work.
These activities may be directed to one area, but they get picked up in other areas. Even the process of engaging these companies not only gives them recognition, but also enables them to improve their product.
[Translation]
[English]
Thank you, Mr. Chair.
Thank you, gentlemen, for appearing before us.
I can't help but think there's a certain element of déjà vu though in the notion of this program. The Government of Canada has had an unsolicited proposals program for decades, hasn't it?
We don't do unsolicited proposals any more. [Inaudible--Editor]...just the introduction to the trade agreements.
I can add to that because I used to work in that program. I'm that old. This goes back to the 1980s and the early 1990s. At that time, we did have a UPP, an unsolicited proposals program, with a fund. That was intended in some ways to do some of this thing, but it also focused on certain technologies. It didn't have exactly the same structure, nor did it have the push component in the same way it does now. This is much more open and transparent, and it provides a more competitive process in the end.
For every company that comes into this process, there's a bid notification, a tender notification. They bring their things forward. They're competing, and there's a competitive process whereby they're evaluated against the core criteria. The UPP didn't have that kind of structure to it. This program does. That's one of the reasons why I believe it's delivering such good value.
That's helpful. Thanks for that.
Just to circle that square, or square that circle, this is still based on an entrepreneur coming forward and presenting an idea, so there's still—
But it is solicited in the sense that the government is asking firms to bring it their innovative products.
Let me just go through the processes. We send out a request for proposals. We sent one out just last week. We're soliciting people to bring forward their innovations. They must be 80% Canadian. The proposal must be in the pre-commercial stage, and it has to be less than $500,000, or $1 million for the military.
I understand that, but it sounds like you're really trying to position this as being a solicited proposal when in fact.... I'm not trying to be critical here, but I'm trying to understand this a little bit better.
It's still very open-ended. With the exception that you actually have a call for proposals, you have not pre-identified which company should bid, so it does seem to bear the mark of an unsolicited proposal format.
In that sense I would say, yes, we have some restrictions on it, which is part of the initial call, and then in the screening we go through, the IRAP panel is looking to see whether the company has their business plan in place, whether their technology is in the right area of development, and those kinds of things. Then finally, there's that third look, which is that private sector/academic review, which is to see whether these companies really have what it takes to go through.
At the end of the day you end up with a pre-qualified list of ideas, innovations, and inventions that are then available for departments to access and test.
What's interesting for the businesses is that by participating in this procurement process they are understanding how to put together a document—
I understand that. I appreciate that.
There's another benefit in the sense that if the Canadian Coast Guard is presented with a particular business concept or innovation, there's an advantage to the Canadian Coast Guard to participate in this because the money actually does not come from the coast guard's A-base. Is that correct? It's Public Works and Government Services' money, which actually raises an interesting question.
If the product was good, and if it is valuable to the Canadian Coast Guard, why couldn't the entrepreneurs simply go to the coast guard and convince them it is really what they needed to buy because it's innovative and will save them money?
I think I'm probably running out of time, but two things to strike me about this. First, it's easier for government departments to participate in this because it does not come out of their A-base, which does raise a question of legitimacy.
Second, does the existence of this program identify a gap in procurement within the Government of Canada, in the sense that if it were easy for a small start-up, entrepreneurial company to do business with the Canadian Coast Guard or the Canadian International Development Agency, or whomever, why couldn't they do it? Why do they need to do it through this program?
The fundamental piece to this program comes on the innovation side. They have a product that the coast guard doesn't know it might need, so that's really the difference.
The coast guard has all its requirements, and it has to choose from a bunch of priorities within its budget, etc., but this program here is really about somebody coming up to us with an innovative idea. We screen for that idea, regardless of what idea it is, against the basic categories, as I say.
Let's say it's some new rubber for inflatable boats. They come in with that, and we sit there and say, “Okay this is an interesting piece of rubber that you can do something with.” Then what we will do at Public Works is to say, “We're interested in procuring to test this, but we need a department to test it for or with.” That department might be the coast guard, or it might Defence, depending on what we find. So we will go to that department and say, “Does this interest you? Do you think it's worth testing this? And by the way, we're buying it for you to test.” So they will test it.
The question is will they buy it in the future? Let's say they are happy with the product. Now they know of its existence, plus they have tested it so they have some sense of its success and are then able to put it into their normal procurement process and their priorities.
[Translation]
Thank you. I have to cut you off and yield the floor to Ms. Ablonczy.
Ms. Ablonczy, you have five minutes.
[English]
Thank you very much. This is an exciting program.
As you know, there was concern for a number of years that the same big companies kept getting government procurement, and the little guys were squeezed out and never had a chance to become big guys because nobody gave their product a chance. Of course, the government's stamp of approval goes a long way in the market.
But for every action there's an opposite and equal reaction, as the saying goes. The other thing we have seen in some countries that are very dedicated to internal procurement practices is that the cost is high, and inefficiency can be high, because sometimes companies know they have you over a barrel in the sense that you have to buy Canadian.
You have seen a recent procurement where the delays keep going on and on. The deliveries never happen. Some very important needs are unmet because of that.
My question is how do you see the government and this process keeping the right balance?
It is very much about looking at innovations in this pre-commercialization phase. Part of the reason that we can keep it in Canada is that it is a research and development program. Within the trade agreements, etc., you have exclusions for R and D. That's part of the reason we can have this program: it ensures that Canadian companies have this opportunity at that level.
The other piece that essentially keeps out the bigger players is that these are relatively small contracts. They're small amounts of money. Although we cannot exclude a large Canadian industry from participating in the program, the small companies are able to produce a product at a price that fits within the boundaries of the program. The value of whatever innovation large companies bring has a lot of overhead attached to it, which ends up costing quite a bit more. These small innovators are much more nimble at providing a new product.
That is the incentive to keep the program. We want to keep the program small. The reason the military component is up to $1 million is the fact that even small innovations for the military tend to cost more to develop. We've found that with $500,000—and we had an opportunity to recommend that the government increase the amount—we have had lots of innovations. They're all in that value range, with some I think as low as in the $40,000 to 50,000 range, and others up at $250,000 to $400,000.
That is how we keep the program small and nimble, and it allows the small and medium enterprises to really participate in the program.
Thank you for that.
As you know, Industry Canada has responsibility for a small business file. It does a lot of work to support and encourage small business.
Could you tell us about the interface between your department and Industry Canada, and their work with small businesses in Canada?
We don't have a lot of interface. This program is a procurement program, so it falls firmly within our mandate. We do a lot of work between our Office of Small and Medium Enterprises and the small business program at Industry Canada.
What we do at Public Works with small businesses is very much helping small and medium-sized enterprises access the procurement system, that is, trying to demystify how to do procurement with government. This program is one way of doing that, but our Office of Small and Medium Enterprises does a lot of that.
We work with Industry Canada on things like business registration. We work with Industry Canada on identifying which of the small businesses, etc.... They have a lot of other developmental programs for small and medium enterprises that fall outside our mandate.
I know that's true, Mr. Chairman, but I think I'd recommend that this committee look more at the merits of better interface. I think we all know that sometimes government operates, as the saying goes, in silos, so we don't really leverage each other's expertise and programs the way we could.
Mr. Gray.
I just want to say that because of the OSME activity, we are working with Industry Canada. We do an awful lot of outreach, as you can imagine, for the OSME program right across Canada. We attend many different events, support businesses, and communicate the advantages of this program.
Part of that process is that we also interface with our colleagues in Industry Canada. We share an awful lot of information, as they do with us.
[Translation]
I have in front of me an article titled “Le Canada, cancre de l'innovation”, which basically means that Canada is doing very poorly on the innovation front, that we are something of a laughingstock. The article says that innovation is still the poor cousin of the Canadian economy and that Canada has received the worst mark possible—a D. The calculation is made based on the 21 indicators used by the Conference Board. And here I was, thinking that we were on the cutting edge of innovation.
I am making a link between innovation and development. I don't know whether you are doing the same, but I do see a direct link myself. If we are a laughingstock, do you think that our future economic development is in jeopardy?
I am not familiar with that article. Our program accounts for only a small part of the sector. It is used for the specific development of small and medium-sized companies that have innovations to present.
Other departments, including Industry Canada, are in charge of large innovation programs. I take care of the supply. This program is only one small part of all the efforts made within government.
Where does the support for the network of small entrepreneurs or innovators come from in the regions? Does it come from Canada Economic Development and SADCs?
That is exactly right. A significant portion of that work is done by regional offices of Canada Economic Development in the west and in Quebec, and by FedNor in northern Ontario. Those are the offices in charge, I think, under the auspices of the Department of Industry.
Can you tell us how many projects have been funded over the past year under the Build in Canada Innovation Program, excluding the military component?
[English]
[Translation]
While you look for the answer, can you tell us whether this is limited to certain regions or whether all Canadian regions can use it?
It is not limited; it is intended for all of Canada. We are very engaged with urban centres and more remote areas. Last month, we participated in a seminar in Banff on innovation for small and medium-sized businesses. We are making presentations across the country.
The total value of contracts issued for 67 projects in three years was $24 million. I could send the committee clerk a summary of the program over the years.
The pilot project has undergone a formative evaluation. That is an initial evaluation. The results will be posted on the website of the Department of Public Works and Government Services over the next few weeks. The evaluation found that the program supported the government's mandates and priorities, and that it seemed to be effective.
Another evaluation will need to be conducted in two years' time to confirm the program's results. We are currently following up with the companies that received contracts to determine what the results of our purchases are—for instance, whether the companies' capabilities have been increased.
As for the evaluation of innovators' proposals, the National Research Council of Canada has an evaluation team, and there is also an innovation selection committee. It is said that the members of that team come from the private sector.
Are they all from the private sector? Who appoints them? Are there any women among the team members?
We appoint the members of the committee, which is made up of three people from the department—the government—and eight people from the private sector. We also have some additional members from the university world. Those are entrepreneurs-in-residence. They are professors from the University of Waterloo, the University of Ottawa, the University of Manitoba and the École de technologie supérieure. So the committee has representatives from a number of universities.
In the past, all the committee members were from the private sector. Now, the committee is made up of professors, entrepreneurs and government representatives.
Thank you.
I assume that the list is public and can be consulted.
Mr. Komarnicki, you have five minutes.
[English]
Thank you. I have a couple of questions.
Number one, this program is a point of entry of sorts into the federal government and a calling card for potential contracts with third parties. Have you done any analysis in terms of how successful the program has been to having access to third parties by individual people who have gone through the program, either by number of people they've been able to employ or by income they have generated after they're out of the program, I guess, because the success would depend on that, and that's sort of the essence of the program?
That's exactly it. The evidence is starting to show that we have to go through the evaluation process, but I will say anecdotally that at this point there are a number of companies that have gone from an innovation, having successfully tested it with us, to sales and exports abroad, which is the biggest driver for growth, and those companies are starting to be successful.
Part of our evaluation is to go out to those companies after one year and, I believe, three years, to see what has happened.
We're seeing growth. We're seeing that these companies are now hiring people and manufacturing and scaling up their products.
Maybe following up on Mr. Byrne's question and probably from a different angle, the essence of your program is that you have small and medium-sized businesses with a product they can't yet take to third parties because they haven't gone through the testing and viability, if you want to call it that. Is it then difficult for small and medium-sized businesses to have the facility and perhaps the cashflow and the capital to do what government already can do through various departments? Is that the essence of your program?
The essence or most important thing in the program is fundamentally to get the first sale, because the thing that helps you most in marketing is that you have actually sold to your government. For many entrepreneurs, when they go abroad, the very first question that a government or a large company will ask them is whether their own government has ever bought any of these.
If you can say yes, they've bought one, then you have a foot in the door. So that's one of the first things we do.
The second thing we do is to make sure their product is actually viable. That is the piece they need to get venture capital and other forms of investment to actually be able to scale up their products.
The point is that they don't have to incur the costs of going through that process, because you provide it to them if they're successful?
That's right. But one of the gaps—and this is the gap we're trying to fill—is that first buy by the government. That is the most difficult thing to do, and that's what this is for, to facilitate that first buy. It's—
It's called a reference buy, so you're able to refer to the fact that the government has bought this product and around the world that's what's expected first.
When I was listening to you, you were saying that people have existing product or existing inventions that they don't know what to do with yet, or they hope they can find something to do with them, and these are the types of people who would come into your program through a proposal and who would use the benefits of your facility. Does the program actually get people to invent with a view to targeting the program to products that haven't yet existed?
No, the program is really about taking your invention and seeing whether you're ready to do it and whether the government can test it for you.
—so we can use the facility and the resources you have to augment our business, because it doesn't cost us to do that?
I suspect that is probably happening. As the program gets better known, people who have ideas may pursue them in order to participate in the program, but you do have to take your product and do quite a bit of work to get it to a rating of level seven. That means you have to invest; you have to invent; your proof of concept has to be done; you actually have to have a product ready to go, etc.
[Translation]
[English]
What is the difference in dollars between going through the process on my own and going through the facility for your program?
The real value is that in a lot of cases if you don't get the reference buy, you're stopped. It's not whether you can put money into it. It's that you're stopped.
I'm speculating here, but you'd probably have to convince a larger company to take your product and take it away.
It's a completely different idea.
[Translation]
Thank you for your questions and answers.
I also have a quick question before we wrap things up.
You mentioned that you promoted the program at seminars. What kind of resources are set aside for the program's promotion, so that companies, like the ones in my riding, would be informed of its existence? How much do you invest into the program's promotion?
Currently, I use the staff of the Office of Small and Medium Enterprises in the regions. We are trying to expand that team. Representatives from other departments also participate. Often, representatives of the Department of National Defence join us at those meetings in the regions. For instance, two representatives of the Office of Small and Medium Enterprises located in Halifax can come to New Brunswick, and the representatives of the Department of National Defence attend the meeting.
Our goal is to show all innovators what opportunities they will have if they work with us. This is an awareness-raising program across Canada—both in small towns and in large urban centres. However, we are much more successful in small towns, where we can get people's attention. In large cities, it is more difficult to attract people.
That is what we are doing. There are not many resources on the ground. Our agents work with small and medium enterprises. They organize specialized meetings as part of that program.
Thank you.
This concludes your testimony. Thank you once again for joining us.
I will suspend the sitting for a few minutes, and then the committee members will come back for the second hour of the meeting.
Thank you for being here. Good luck with the program going forward.
Members of the committee, we will continue our ninth meeting.
This time, we are welcoming witnesses from the Public Service Commission of Canada. More specifically, we are hearing from the following individuals: Ms. Robinson, President; Ms. Laurendeau, Senior Vice-President, Policy Branch; Ms. Bogden, Vice-President, Audit and Data Services Branch; and Mr. Thom, Vice-President, Staffing and Assessment Services. They are here to speak to their 2012-2013 annual report and various audit reports produced in 2012-2013.
Without further ado, I yield the floor to you. You have about 10 minutes. Afterwards, the committee members will have an opportunity to ask you questions.
Thank you for joining us. Go ahead.
[English]
Thank you, Mr. Chair.
I am very pleased to be here today to discuss, on my own behalf and my fellow commissioners'—Susan Cartwright and Daniel Tucker—the Public Service Commission's 2012-13 annual report, tabled in Parliament on November 6.
The mandate of the Public Service Commission is to promote and safeguard merit-based appointments and, in collaboration with other stakeholders, to protect the non-partisan nature of the public service. We welcome this opportunity to report to Parliament on our mandate.
Today I will be focusing my remarks on three areas. I will discuss the results of our oversight activities, make observations on the hiring and staffing activities in the public service, and highlight some of areas where I think there is still more work to do.
[Translation]
Oversight of the staffing system is a priority for the Public Service Commission. Based on all our oversight and feedback mechanisms—which include monitoring, audits and investigations—the commission has concluded that the management of staffing in departments and agencies continued to improve in 2012-2013.
The 12 audits the PSC conducted this year found that most of the key elements of effective staffing management were in place, and deputy heads and managers respected their delegated authority. However, some areas still require further attention. For example, some organizations need to continue to improve their internal monitoring of appointment processes. That monitoring allows them to detect and correct issues in a timely way. This brings me to our investigations.
This year, 44 cases were founded. We saw more cases involving fraud—for instance, the use of false educational or professional credentials. Many of these cases were detected as a result of improved monitoring by departments and agencies, as well as by the PSC.
However, I would like to note that the number of problematic transactions and founded investigations is actually very low in the context of the more than 100,000 hiring and staffing activities conducted on average each year.
[English]
With respect to hiring activities, this was an unusual year in many ways as departments and agencies focused their efforts on redeploying employees and placing persons affected by workforce adjustments, thereby altering the normal staffing patterns in government.
Overall hiring to the public service declined by 28.3%. This includes indeterminants, specified term and casual hiring, as well as the hiring of students. With fewer hires and more departures, the overall population that is covered by the Public Service Employment Act declined by 5.4%. Public service hiring declined throughout the country, but more particularly in the national capital region.
While student hiring was also down, over 9,500 students were still hired for part-time and summer employment. They represented 31% of all hiring to the public service, a percentage that has consistently increased over the past four years.
We also saw enhanced access to public service jobs. National area of selection continues to allow more Canadians to apply for opportunities no matter where they live. As well, Canadians without any previous work experience in the public service accounted for 41.7% of new permanent hires, the largest component for the first time in over a decade.
Now I'd like to turn to the support that the PSC provided to organizations in managing workforce reductions.
In 2012-13, the PSC enhanced the priority administration program, which allows the public service to retain qualified employees who have the skills and experience needed for the future. Working in close collaboration with departments and agencies, the PSC placed 956 priority persons, 17% more than last year even though permanent hiring was down by some 60%.
I'm also very happy to say that since April 1 we have successfully redeployed another 953 priority persons, the vast majority of whom were surplus employees. At the same time, the PSC has seen a drop in the placement in other priority categories, including a significant decline in the placement of Canadian armed forces veterans who have been medically released.
At the request of Veterans Affairs, the Public Service Commission provided technical options to address this issue for their consideration and the government has recently introduced Bill C-11, An Act to amend the Public Service Employment Act (priority hiring for injured veterans). Should Parliament approve these proposed amendments, the PSC is ready to implement them.
I'd now like to turn to public service renewal. There were fewer graduates who entered the public service in 2012-13. There were also fewer employees aged 35 years of age and younger; they represented 18.4% of the public service in March 2013, down from 21.4% in March 2010. In this context, a focus on renewal and the recruitment of new employees will gain greater importance as the public service moves forward.
Future recruitment must also take into account our increasingly diverse population. According to the most recent population data published by Treasury Board Secretariat, overall, we are making progress with the representation of employment equity groups in the public service. However, we still have work to do.
This year, the PSC conducted further research to better understand the challenges that employment equity groups experience and to use the findings to better target areas for specific action. For instance, we looked more closely at how being a member of an employment equity group affects the chances of promotion. One of the notable findings was that both men and women with disabilities were less likely to be promoted compared to those not belonging to an employment equity group. Even though these findings represent a single snapshot over a period of one year, we are concerned and are now undertaking more detailed work using this year's data. As part of this, we are taking a deeper look at career progressions among the designated groups.
In the meantime, we are sharing these findings with those in the public service who have leadership responsibilities for employment equity, including deputy ministers, and heads of human resources. We've also shared these results with the champions and the chairs of the respective employment equity groups in government.
[Translation]
With respect to innovation, the PSC continues to leverage its technology and expertise to offer departments and agencies efficient and cost-effective services tailored to their needs.
This year, the commission expanded its e-testing capacity. We have seen a steady increase in online testing, which now represents 50% of all tests administered by the PSC. We also made further advances in the use of unsupervised Internet testing and computer-generated testing. These innovative tools are a valuable link in enhancing access to public service jobs and effectively managing high volumes of applications.
I would now like to turn to the issue of non-partisanship. Safeguarding the political impartiality of the public service continues to be of critical importance. Our 2012 staffing survey found that employees' awareness continued to increase. For instance, 73% of respondents were aware of their rights and responsibilities with respect to political activities—up from 69% found in last year's survey. We will continue to collaborate with departments, agencies and other stakeholders to find ways to sustain this momentum.
[English]
It has been seven years since the implementation of the Public Service Employment Act, and we are reflecting on how we can continue to evolve our risk-based approach to audits, for example, with respect to small and micro organizations.
Going forward, the Public Service Commission is committed to working collaboratively with departments and agencies to build a strong culture and foundation of compliance, while providing independent oversight and assurance to Parliament on the health of the staffing system and the non-partisan nature of the public service.
Finally, Mr. Chair, you may have noticed that the PSC itself was among the 12 organizations audited in 2012-13. The commission put in place robust measures to mitigate risks concerning possible conflicts of interest. The findings and the three recommendations in this audit are being addressed through the implementation of a detailed action plan.
I would now be very pleased to respond to your questions.
[Translation]
Thank you so much for your presentation.
Without further ado, I will let the committee members ask questions.
Mrs. Day, you have five minutes.
Thank you, Mr. Chair.
I wish you and your family happy holidays. Thank you for coming to testify upon invitation.
My first question has to do with veterans and military members. That group is at a huge risk. In fact, the rate of suicide has increased among both men and women. That rate is 26.6% for men and 14% for women—which is 45% higher than among the general population.
You manage various priorities, including disability, workforce adjustment, returns following an extended leave, moves with a spouse or a common-law partner who is a member of the Canadian Forces, and so on.
Are there any special measures to quickly reintegrate veterans into the workforce?
Thank you for that question.
Medically released veterans are a priority. The commission can direct veterans with that priority status to the available positions. The current legislation sets out an order of precedence. For instance, some priorities are statutory and have precedence over other types of priorities.
The legislation stipulates that medically released veterans have a regulatory priority. The commission is happy to see that the recently introduced bill grants veterans a higher level of priority, as that will help us appoint a larger number of medically released veterans.
Thanks to the priority program, we have the flexibility to appoint those individuals to permanent positions.
According to the 2012-2013 annual report, for the fist time in over a decade, those with no previous experience were the main source of new indeterminate hiring. Can you explain to us why that was?
Thank you for the question.
That's a bit difficult to explain because 2012-2013 was an exceptional year. I hope the fact that an individual with no experience in the public service can pass one of our exams indicates that our staffing processes are open to the public and accessible to everyone.
We know that, in 2012-2013, many public workers were laid off. Were indeterminate positions created to fill gaps or was there an urgent need for extra staff?
Thank you for the question.
The general workforce adjustment policy falls within the purview of the Treasury Board. The commission plays two key roles. First, it is responsible for using that policy to determine whether a public servant will be retained or laid off. To us, it is important to ensure that this process is transparent and fair. Second, the commission is responsible for managing the priority system. The public servants who have been declared surplus have the right to be part of that system. The commission's responsibility is to ensure that those individuals are appointed to a position before any other public servants. In 2012-2013, we appointed almost 950 surplus employees, and since April 1, 2013, we have appointed another 950 of them.
[English]
Thank you, Chair.
Thank you, all of you, for appearing before us.
Ms. Robinson, on page 1 of your presentation, you said, “This year, 44 cases were founded.” What does that mean? Did you fire 44 people?
Thank you for the question.
Under our mandate for conducting investigations under the act, there are a number of categories under which we do those investigations. We can do investigations if there's been an error made in a competitive process, if there's been improper conduct.
In this case, as I mentioned, I talked about the number of fraud cases. After a finding as a result of any one of those investigations, a number of different corrective measures could be put in place, including revocation of a position.
In some cases—
I'm sorry; I have to just interject, if you wouldn't mind.
I want to know if those 44 were fired, though, or just corrected. Out of the....
How many public servants are there?
Normally we have about 100,000 transactions per year. The number of founded investigations in that context is relatively small, but of course we take all of these cases very seriously.
For example, in a fraud case where someone has presented false credentials, normally what would happen in that case is the appointment would be revoked and the person would no longer work for the public service. Those are quite rare.
In other cases, depending on what has happened in the context of the investigation, different corrective measures are put in place. In fact in our annual report, we do have a detailed table with all of the different corrective measures, by numbers, following the investigations.
Okay, but I'm still not getting an answer. Maybe I just don't grab it. Maybe you could just be a little clearer.
I guess your job is to monitor the public employees. In so doing, there are going to be cases where you have to take final action. You have to fire.
How many public servants are there, did you say?
Last year, then, for how many of them would the corrective measure have been, like, “Sorry, you're terminated”?
In 2012-13 the commission revoked nine appointments. That's the term used under the law: those appointments were “revoked”. Those persons no longer had employment in the public service.
Okay. That's what I was trying to understand.
Out of 200,000 employees, you've only had nine that you've had to dismiss.
I should clarify that the jurisdiction of the commission only relates.... These are investigations that relate to the question of—
Mr. Dave Van Kesteren: Fraud.
Ms. Anne-Marie Robinson: No, fraud vis-à-vis an appointment process; there may have been other public servants who for different reasons had been let go from the public service.
That's correct.
Mr. Dave Van Kesteren: Okay. Got it.
Ms. Anne-Marie Robinson: So the nine just have to do with revocations of appointments, where the appointment process itself was somehow flawed.
I'm glad you clarified that, because I found that extremely puzzling. I thought you either have a really great workforce or you...I don't know.
I want to go to your statement on your “non-partisan” public service. What do you mean by that? Are you saying that in the workplace they are not to display any leanings toward one party over another? Is it just a training that our public servants have so that...?
Can you maybe elaborate on that?
The Public Service Commission's role vis-à-vis non-partisanship and the primary way we ensure non-partisan public service is to ensure that the appointment itself is based on merit and is free from political influence. So that's a big part of what we do.
We are also responsible for regulating political activities of public servants, and there are two main categories. If a public servant, for example, wants to be a candidate in an election, we have a regime in place such that the public servant must come to the commission and ask for permission. Depending on the nature of the election and the nature of their duties, they would normally take a leave of absence, and then in a federal election, if they were elected, they would resign from their position. For municipal elections, depending on their position and the nature of their duties, they may or may not take a leave of absence.
We also provide guidance to public servants. Public servants under the Public Service Employment Act do have a right to engage in political activities, provided that engagement does not impair their ability to conduct their job in a politically impartial manner. So for example, if you're a very senior public servant, what you could do would be extremely restricted. There are many public servants, for example, in administrative jobs, who do have rights and they may well be able to engage in political activities, because they are in positions that are not highly visible and the nature of their duties is such that they wouldn't put the impartiality of the public servant at risk.
Having said that, while at work and while carrying out their functions, all public servants must conduct their duties in a politically impartial manner.
[Translation]
[English]
Thank you, Mr. Chair.
Welcome, Ms. Robinson. It's a pleasure to see you and your associates again.
I have been following and tracking the Public Service Commission for quite a few years now, and I welcome your annual report. It's very helpful for us to see trends and patterns as well as some themes and some problems that simply don't go away, which I can point to as well. You prefaced your remarks under hiring and staffing this year with the phrase that this was an unusual year in many ways, in that many were focusing on redeployment. I see that as a diplomatic way of saying there was pandemonium in the public service with all of the cutting and hacking and slashing that went on, and the problems that all of those create in terms of redeploying people who are declared surplus but who have a right to be re-employed elsewhere.
My question has to do with the second paragraph in which you say that with all of this redeployment going on, the actual overall population covered by the act declined by 5.4%. Can you tell me how many bodies that means, how many persons' jobs that 5.4% less than the previous year represents?
Thank you for the question.
The population declined from around 211,000 to in the range of 200,000. Those are approximate numbers. I can ask one of my colleagues—
So just doing the quick math at, say, a total cost of $100,000 per employee with salary and benefits, etc., that would be $1.1 billion cut from the public payroll. If you take $100,000 times 11,000 people—I think I've counted up the zeros—that would be $1.1 billion in savings, for all this cutting, hacking, and slashing that has gone on.
But on the other side of the coin, one of the recurring themes that you and your predecessor, Madame Barrados, have always brought to our attention is the overwhelming proliferation of contracting out and hiring temporary services because of the problem you identified—that it takes 5.5 months just to hire somebody. It took 4.5 months in 2011, and 5.5 months in 2012.
Government departments that are left short by cutbacks end up going to temporary help services. Can you tell me how much money the government is spending per year then on...? It's $459 million on managerial consulting. How much is being spent on temporary staff? Can you help me with that figure?
Thank you for the question.
The commission does not have that information. Temporary help and contracting of agencies are under the responsibility, I believe, of Public Works, shared with Treasury Board policy. The commission does monitor the use of casual workers, but not temporary help in particular, because it's not under our jurisdiction.
So you can't help us connect those dots. I thought it was one of the things that Madam Barrados raised with us a number of times, the use of Kelly Services' secretarial workers. These businesses are popping up all over Parliament Hill to provide temporary, low-paid services to do the work that was once done by a well-paid public servant who had benefits. This is not something that you track? Is it not something that you should be concerned about as a Public Service Commission?
The Public Service Commission works with departments to ensure that overall planning is in place, and I know that my predecessor, Madam Barrados, did do a special study on temporary help—
—looking particularly the inflow into permanent jobs. We do monitor the transition from casual worker into permanent jobs to ensure that the merit process is being respected, but that would be the jurisdiction and the perspective of the commission.
[Translation]
[English]
[Translation]
[English]
Before I get to my actual questions in reaction to my colleague's points, I want to point out that between 2006 and 2012, we increased the public service by about 36,000 jobs. As you record, there might be 11,000 fewer jobs here now than there were before, but a number of those were empty. They weren't filled. A number of people retire also, so we're not talking about a cut of 11,000 people. We didn't cut 11,000 people.
What's the proportion of anglophones versus francophones in the overall public service—just a rough cut?
Based on the Treasury Board data from 2011-12, 68.2% of the core public administration—which is slightly beyond the Public Service Employment Act population—is anglophone and 31.8% is francophone.
I don't have that breakdown, but, Mr. Chair, I'd be happy to send that information to the committee.
I suspect it's a higher number.
In your organization, do you hire people from the outside? Is that your job or do you deal with people moving between jobs inside the public service?
Thank you for the question.
The overall responsibility of the Public Service Commission is to set appointment policy to ensure that appointments themselves are based on merit and free from political influence. The day-to-day staffing is delegated to deputy ministers and largely done by government departments, except for a few things. My colleague here Gerry Thom still runs the student recruitment programs and a number of programs for co-op student summer employment. The commission manages those processes, but the appointments themselves are done by individual departments and they all do their own human resources planning.
I've heard allegations in the past that inside the public service—and, as you're saying, the hiring is being done by deputy ministers or their agents—there is cronyism, favouritism, etc. Is that your experience or not?
Thank you for the question, Mr. Chair.
In general, the commission's responsibility is to oversee the integrity of the appointments in the public service, and so we have a robust system of oversight, which includes regular reporting. We have a robust audit function and every year we conduct in the range of 12 audits, and we continually use a risk-based approach so that we can intervene in departments if we see problems. I spoke earlier about our investigative function. If a problematic transaction comes to light, we have the authority to investigate those transactions and can take corrective measures up to and including revocation.
In general, we see those things as being relatively rare. Since the authority was delegated to departments in 2005, we have been working closely with them to gradually improve their management of the system, encouraging them to have robust monitoring in place because, in a delegated model in such a large, complex environment, we want to see departments themselves detecting and correcting problematic transactions in real time.
Oh, I have only 45 seconds.
I think this is in your domain. What are the criteria the public service uses to hire people? Does it proportion out men, women, anglophone, francophone, minorities, and whatever?
Our appointments are based on merit and based on the qualifications for the job, so when it comes to bilingualism, certain jobs are designated bilingual or non-bilingual—and this is done under Treasury Board policy—and so there's a whole policy behind that determination.
In terms of employment equity, there are some provisions under the act, for example, to designate certain competitions or limit the area of selection to certain employment equity groups. However, I would say that over the past five years that's been used on average in less than 3% of appointment processes. So in 97% of appointment processes or more, those provisions are not used in terms restricting areas of selection.
[Translation]
[English]
Thank you very much, Mr. Chair.
Thank you to our witnesses.
I'd like to ask about the relative contribution or inclusion of whistle-blowers in your investigative process. Would you be able to describe to the committee the volume of independent participants who may raise a concern from within the public service, people we would generally call whistle-blowers, very courageous people? Do you sense there's any constraint to their participation?
Thank you for the question.
I'm trying to think of the number, but I would say in general we have some 500 investigations. I'll correct that for the record if I'm incorrect about that, but I believe it's in the range of 500 complaints or cases that are brought to our investigations branch on average every year. They're reviewed by our jurisdictions directorate and then we have to determine whether we have both jurisdiction and grounds to launch an investigation.
They come to us in a number of ways. Sometimes departmental monitoring will bring them forward; sometimes it's the commission's audits that will uncover cases; then we have individuals as well who bring cases forward to the commission. The commission is always open to anyone who wants to bring forward a complaint or a concern. We are an independent organization and, using a legal test, we review those concerns independently and then make a determination as to whether or not it would be appropriate to launch an investigation.
Thank you very much for that.
You mentioned jurisdictional issues in your testimony to the committee, whether or not the commission has the jurisdiction to be able to conduct an investigation. Have you been frustrated or thwarted in some of your investigations because you lack the jurisdiction to enter a particular field? Is that a concern of yours, or not?
It is not generally a concern. There's nothing that's come to my attention since I've been in this office. We do, for example, have subpoena powers and other powers that we can use. So we have quite a robust set of powers that allow us to interview who we need to interview within the normal legal constraints of using those powers.
One of the points of vulnerability in terms of ensuring a non-partisan public service might be considered the role of the executive, a minister in question. Do you have powers to investigate a minister in terms of the decision-making process for a staffing, a hiring process?
According to our act, we investigate appointment processes, and in the context of an appointment process we can, if necessary, for example, interview or ask questions of anyone who is involved in the process, including a minister.
Thank you very much.
Would you be able to describe to the committee any elements of the act or the procedures available to you through legislation or otherwise that may be frustrating your attempts or are of concern to you to be able to do a complete and full job? Are there any elements of the act that you would like to advise the committee should be reviewed, or any amendments that you would like to have considered?
Thank you, Mr. Chair, for the question.
That's certainly a question I would want to give thought to, but I could say at this moment nothing has come to light vis-à-vis our investigative powers.
[Translation]
[English]
Thank you, Mr. Chair.
Thank you for coming in today to speak about this important issue. I think the last time you spoke in front of this committee was a couple of years ago, when you were newly appointed. It's good to see you back.
It's also good to see I think some positive trends. I always appreciate looking at what's happening year over year, but I also appreciate the fact that in your report you have some longer-term trends.
One figure that intrigues me in particular is figure 6 in your report, where you talk about “Appointments under the Public Service Employment Act of new indeterminate employees, by fiscal year”. This goes all the way back to 1993.
There's an interesting trend. There was a very similar level of appointments in 1996-97, with 2,966 appointments. It compares almost exactly to 2012-13, with 2,949. But there was a crest of 20,087 in 2008-09.
Can you describe some of the factors that are causing those trends? Is 2012-13, obviously there are some things related to the deficit reduction action plan that are going on. Is the set of circumstances very similar to what was taking place in 1996-97 under program review then?
Thank you for that.
I'm not sure I could give you a full account of all of the reasons. As well as the things that you have mentioned, there were different areas of growth and downsizing within the federal public service. That chart covers a very long period of time. There also were some reorganizations of government departments that affected this, where some departments were put in and outside of the Public Service Employment Act.
With respect to the crescendo, that peak in 2008-09 of 20,087, was some of that related to things like the stimulus program? What was going on then, given the fairly dramatic increase in new appointments that year.
We can't say for sure that it would be strictly associated with the economic action plan, but there was more staffing activity at the time, and the figures don't necessarily adequately.... We can't disaggregate what is strictly from the economic action plan, but we certainly have seen an increase in the staffing actions associated with that period.
Okay.
One of the positive trends you mentioned in your presentation was how in the public service opportunities are opened up to Canadians from farther afield. I think it's really important that all Canadians, from coast to coast to coast, feel that this is their government and that they're not excluded from some of the opportunities that exist in the public sector.
Beyond technology and the ability to communicate with people about opportunities, what kinds of measures are being taken by the public sector to ensure that people from all regions of the country have access to those opportunities to work in the public sector?
Thank you for that question.
I would say that one of the most important policies is the national area of selection policy, which has been in place for a number of years. That policy does provide that for external appointments, people from all across the country have a chance to compete for those appointments.
Then, thanks to the efforts of my predecessor and of my colleague Mr. Thom, who manages this area, we have really made advances in using Internet-based testing and other technologies to allow more Canadians to easily access jobs. In some cases, they can take tests from their home. That provides in general much greater access.
You also mentioned in your presentation that student hiring was down; but still, 9,500 students were hired for part-time and summer employment. Is most of that in Parks Canada? What are the departments where those students might have the opportunity to work for the public sector?
Thank you for the question, Mr. Chairman.
I could send a list to the committee. I'm sure we have a detailed list, which I don't have with me today.
But that hiring takes place all across the public service. I can't say off the top of my head in which departments. It's probably in proportion somewhat to the size of the department, but even in our own department, we do hire summer students as well.
Okay. I just wanted to get a general sense of it.
Were some of these cases summer hires looking to fill in for people who are on vacation? Does this represent a good summer experience for them, whereby they can subsequently get a full-time position with the public sector?
It does represent a lot of summer employment and part-time employment throughout the year. Under the Public Service Employment Act there is a policy in place, and it's part of Treasury Board policy as well, that allows students under certain circumstances, providing they meet the merit criteria, to be bridged into the public service. So this is a really important source of renewal for the public service.
[Translation]
Thank you.
Thank you, Mr. Trottier. Your time is up.
I now yield the floor to Mrs. Day for five minutes.
Thank you, Mr. Chair.
A member opposite asked earlier what the percentages of francophones and anglophones were, and he was told that the proportion of francophones was 21% and that of anglophones was 68%. You were then asked what the proportions were in Ottawa, but you did not have the answer.
There are 700,000 francophones in Ontario. Can you assure us that Franco-Ontarians are well represented? Although obtaining a job depends on the productivity and not the language, is there at least an obligation to respond in French to francophones outside Quebec?
I would first like to clarify something. You said that the proportion of francophones in the public service was 21%, but it is actually 31.8%. The proportion of anglophones is 68.2%. When it comes to the representation of anglophones and francophones, these are the figures we have, but they belong to the Treasury Board. The figures actually come from the Treasury Board's annual report on official languages from last year.
The determination of a position's linguistic capacity is based on the Treasury Board's definition with regard to the necessity to have bilingual positions in certain locations—be it for services to the public or for internal services that are to be provided to employees in both languages.
You told us that earlier. I would like to know whether Franco-Ontarians, Franco-Manitobans and francophones outside Quebec can obtain a response in French, based on the position and its obligations, and if that is the case across the country.
I don't want to go too far in answering this question, but according to the Treasury Board's policy, in areas where services to the public are to be provided in both languages, francophones can obtain a response in French. For that to be the case, the area must be designated as bilingual. However, internally, employees have the right to be served in the language of their choice when it comes to payroll services and other similar services.
As for employment equity, some percentages are provided in table 6, on page 29 of the English version. As we know, aboriginals, persons with disabilities, members of visible minorities and women account for a certain number of applicants. Relevant figures are provided for the period between 2010-2011 and 2012-2013, but when we look at the percentage of women, N/A is marked for each of the three years. So the data is not available. A woman is a woman, and a man is a man. It seems to me that this can be calculated.
Are there still any programs for equality of access to the public service for men and women? Could you shed some light on this table for us? It seems to me that this is not normal.
It's on page 29 of the English version, in table 6, which is titled “Percentage of applicants to advertised processes, by employment equity designated group and fiscal year, compared to the 2006 workforce availability”.
In order to meet our obligations under the Employment Equity Act and the Public Service Employment Act, we can apply certain measures to fill positions when there is a discrepancy in a specific category in terms of employment equity. In the case of women, for instance, if we note a discrepancy in a group, we can use the legislation's flexibility to correct the situation.
We don't have any positive discrimination programs. As Ms. Robinson explained, for all employment equity groups, there are mechanisms aimed at increasing representation in areas of deficiency.
As for women, there are still discrepancies in certain occupational groups—such as engineers—and mechanisms are in place to increase the representation.
We have no specific target, but generally speaking, the policy dictates that representation within departments should reflect the workforce availability. When it comes to aboriginal groups, the representation is where it should be.
[English]
Thank you very much, ladies and gentlemen, for appearing here again.
I'm starting off on chapter 4, page 79, table 21 of the report, and it's “Public Service Commission investigations into appointment processes”.
It talks about 228 cases completed in 2012-13, and then you have a breakdown accordingly. There were 126 cases closed at intake. I'm trying to clarify the difference between those at intake and those that are unfounded.
Thank you for the question.
The ones that would be closed at intake would be cases that our jurisdictions directorate in our investigations function would examine. We would have determined that we either don't have the jurisdictions or we don't have grounds to launch an investigation. Under the law, of course, we must respect those two principles.
Thank you.
With regard to the 44 investigations founded—I'm just trying to clarify—it says it could be somebody who used false educational and professional credentials.
Are they dismissed then, or not hired? What's the consequence?
It would depend on the circumstances. Of the 44 cases in fraud, I don't know exactly the number, but as I mentioned earlier that resulted in nine revocations. I'm not sure if those were all related to fraud, but there were nine appointments that were revoked in 2012-13.
The other cases of fraud would include cheating, for example, which constitutes fraud under the Public Service Employment Act, or we've seen cases where people may falsify test results. In those cases, depending on the nature of the problem that was identified, the corrective measure could include revocation.
Sometimes these are people who have not been appointed to the public service, as we might find fraud before an appointment is made. In some of those cases, you'll see a corrective measure for those individuals, which is like having a note on your file for a certain period of time. If you want to apply for a job in the public service, it would be disclosed to anyone looking to hire you that this fraud had been committed.
There are different measures, depending on the case.
Who's responsible for the other ones? You said there were 200,000.
Does that fall within each department and each manager, then?
There are 200,000 public servants who are employed under the act. There is in the range of 100,000 staffing transactions each year. That number was included to give you a sense of the scope of the number of transactions, to put the 44 fraud cases in context. It is problematic that we've had 44 cases, but in the context of 100,000 staffing transactions, most of the transactions are not problematic in our view, and things are generally sound in the staffing system.
I'm not sure of the origins of that phrase, and I agree that it's sometimes difficult to understand. I think it's in the act, but I couldn't say for sure. It means a permanent hire.
Yes, I would agree with that comment.
I believe my colleague is telling me that it is in the act, but it does refer to permanent hires.
Thanks.
With regard to employment equity groups, how many are there how has that changed over the years?
There are four groups under the Employment Equity Act: aboriginal people, persons with disabilities, members of visible minorities, and women. I think those groups have been fairly consistent over the years.
We share this area of responsibility with Treasury Board, and Treasury Board has general responsibilities with respect to employment equity. Because the commission is responsible for appointments under the Public Service Employment Act, our main responsibility is to ensure that the appointments are barrier free. For example, for persons with disabilities, we ensure that the appointment process itself provides accommodation where necessary so that everybody is on a level playing field when it comes to appointments under the act.
Regarding persons with disabilities, we are trying to make a conscious effort to hire persons with disabilities, and also aboriginals. Have you been able to quantify if there's been success in that hiring process?
If we look at the overall population data, as issued by Treasury Board rather than the commission, we can say we are making good progress. As my colleague, Madam Laurendeau, just mentioned, where we still see some gaps and have more work to do is generally at the most senior levels in government and in certain occupational groups. Our work, more and more, is focused on targeting those areas where we still have to make progress. Our job is to ensure that the appointment mechanisms are in place to reach our objectives. There are many others with responsibilities, including ensuring that there is accommodation when necessary and ensuring there are special developmental programs. There's a whole range of measures that can be used to ensure that we meet our targets overall.
Thank you for your efforts to modernize our federal workforce. It's beneficial to all Canadians.
Thank you very much.
[Translation]
I want to come back to women and appointments to senior and executive positions. I am thinking of National Defence and other similar departments, and even Parliament. Are women occupying decision-making positions, managerial positions? Are their numbers equivalent to those of men? If not, what are the percentages?
I don't have that information on hand today, but I can send it to the committee. I will talk about it with my colleague from the Treasury Board who is responsible for information on employment equity for the general public.
Thank you.
If you want to obtain additional information, you can always talk to the clerk, who will then share it with the members of the committee.
I want to thank you again for being here. I want to wish you very happy holidays, especially Ms. Laurendeau, as this was her last day at the Public Service Commission. She will begin a new mandate tomorrow.
[English]
[Translation]
Congratulations. I wish you all the best in that new mandate.
I also want to wish happy holidays and a happy 2014 to all the committee members and assistants behind us. We will see each other in 2014.
Mr. Trottier, do you want to add anything?
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