PACC Committee Meeting

STANDING COMMITTEE ON PUBLIC ACCOUNTS

COMITÉ PERMANENT DES COMPTES PUBLICS

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, October 5, 2000

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[English]

The Chair (Mr. John Williams (St. Albert, Canadian Alliance)): Good afternoon, ladies and gentlemen.

Our order of the day is pursuant to Standing Order 108(3)(e), consideration of chapter 9, “Streamlining the Human Resource Management Regime: A Study of Changing Roles and Responsibilities”, of the April 2000 report of the Auditor General of Canada.

Witnesses today from the Office of the Auditor General of Canada include Mr. Denis Desautels, the Auditor General of Canada; Ms. Maria Barrados, Assistant Auditor General; and Mr. John Holmes, principal, audit operations.

For your information, we actually had lined up some other witnesses today. As you may recall, this meeting was actually scheduled for Tuesday. The House was adjourned Monday and Tuesday for the funeral of our former prime minister, the Right Honourable Pierre Trudeau. One of the witnesses was supposed to come in from Vancouver. Since we couldn't guarantee that this meeting would take place because of elections and everything else—they went without a hitch this morning, but you never know about these things—the witness didn't come all the way from Vancouver. Again, as for the other witnesses, since we couldn't guarantee that the meeting would be held, we decided that we couldn't hold them accountable to be here for this meeting.

We mentioned to the Auditor General that the witnesses couldn't be here, but he asked that he be able to present the chapter and that we discuss it anyway.

I will turn the floor over to Mr. Desautels.

Mr. L. Denis Desautels (Auditor General of Canada): Thank you very much, Mr. Chairman, and thank you for the opportunity to present the results of our study on streamlining the human resource management regime, which was reported in chapter 9 of our report of last April.

We undertook this study, Mr. Chairman, because, like many observers, we believe a well-performing public service is vital to the interests of Canada and Canadians. From our work in government, we've become concerned about the inefficiency and ineffectiveness of the current human resource management regime.

There is broad agreement on the need for reform and there is widespread frustration among managers who actually have to work with this system. Among deputy ministers, though, there are concerns about the practicality of pursuing the fundamental legislative changes that are called for.

To deliver results that ministers and Canadians expect, the public service must be able to attract, develop, and retain highly skilled people with the values and other qualities that serving the public interest implies. We are therefore pleased that the committee has decided to hold this hearing to look into the problems that characterize the current regime—namely, fractured responsibility and unduly complex and outdated systems.

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Some of the problems in the system today are long-standing concerns that have been the subject of extensive review and analysis as far back as the 1962 Glassco commission. Appendix B to chapter 9 contains, for members' reference, a list of studies by the federal government and others on human resource management in the public service over the period from 1967 to now. Despite these studies and numerous management initiatives, there has been little change in the basic framework of 1967. Today, pressures are building for timely action to streamline the regime.

[Translation]

In 1967, roles and responsibilities for human resource management were set out in legislation. There are several main players. The Treasury Board acts as the employer, consulting and negotiating with unions and setting policies and guidelines for a range of HR matters. The Public Service Commission makes appointments to and within the public service and administers the system of recourse, among other things. The Clerk of the Privy Council is the Head of the Public Service; and deputy ministers manage staff in their departments. As you are aware, the Public Service Commission, unlike the others, is a parliamentary agent independent from Cabinet.

In addition, there are two key committees of deputy ministers, and a number of other parties who influence the management of human resources. Rather than taking the time to detail their various responsibilities, we have prepared a short summary of those I have mentioned. Information on the many others can be found in Appendix A to Chapter 9.

With the responsibilities for managing human resources so divided, so too is the responsibility for bringing about much- needed change, and, indeed, responsibility for reporting on performance. This system of “fractured responsibility” is ill suited to today's environment, where flexibility and adaptability are essential and competition from other employers for skilled resources is increasing.

Not only is the legislative and structural framework governing human resource management unduly complex and outdated, but supporting administrative systems are cumbersome, costly and outmoded. Public service staffing, in particular, remains a source of frustration to managers and employees. For example, it takes about twice as long to staff a position in the core public service as in the quasi-public sector.

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Our study examined the regime that applies to the main departments of government and, for the most part, to the many other agencies for which the Treasury Board acts as the “employer” on behalf of the government. This regime embraces some 80 organizations and 140,000 employees. However, I draw to the committee's attention that certain other agencies, such as the Canada Customs and Revenue Agency, were covered until recently by the same regime but are now “separate employers”. In the creation of the customs and revenue agency, which now employs more than 40,000 public servants, the case was made that agency status would provide for more flexible management of human resources and thereby improve service and enhance efficiency. In my view, this is a significant indication of the difficulties with the present public service regime.

[English]

The public service is now smaller than it has been since the early 1990s, and yet there has been no streamlining of the human resource regime.

There are other significant pressures for change. The public service is aging and faces a potential leadership crisis as current executives and the feeder groups below them begin to retire. Also, youth is underrepresented. Thus the public service will have to recruit, develop, and retain significant numbers of staff in an increasingly competitive labour market, with knowledge workers who have new expectations of the workplace.

An important evolution in the HR regime has been the increasing delegation of responsibility to deputy ministers and a more collective management approach under the leadership of the Clerk of the Privy Council. If this approach is to overcome historical difficulties, it's essential that responsibilities be clearly assigned and a full accounting of results be given. Responsibility and accountability need to be clearly assigned for streamlining and simplifying the existing regime and engaging Parliament in the changes that are needed in government structures and supporting structures. Mr. Chair, this is an area your committee may wish to explore.

The Public Service Commission is Parliament's agent in preserving a non-partisan, merit-based, representative, and professional public service. It's a central agency of government in training and other matters and a service delivery agency in providing services, expertise, and regional presence. These various roles and responsibilities have been the subject of recent consultations with stakeholders, and it's imperative that Parliament be included in these discussions. An important part of this dialogue should be the need for legislative reform of staffing.

The Public Service Commission also needs to strengthen its reporting to Parliament on the extent to which service-wide and departmental performance meets the objectives of the employment act. Similarly, the Treasury Board and departments need to improve their reporting on the human resource management matters for which they are responsible, both what they are to accomplish and what they actually achieve.

In conclusion, Mr. Chairman, the government needs to give serious consideration to simplifying the current legislative and administrative framework for human resource management. Various current reports, in addition to our own, highlight this need. I think the problems are well known and understood. Therefore, the time has come to act. These issues should be given a higher priority than they have received in the past.

Thank you, Mr. Chairman. My colleagues and I would be happy to answer the committee's questions.

The Chair: Thank you, Mr. Desautels.

We'll turn to Mr. Mayfield for the first round. You have eight minutes.

Mr. Philip Mayfield (Cariboo—Chilcotin, Canadian Alliance): Thank you, Mr. Chairman.

When I read your report, sir, I was reminded of a short dialogue I read about that took place with Mark Twain. After he returned home from church he was asked, “What did the preacher talk about?” He said, “Sin.” “What did he have to say about it?” He said, “He was against it.”

This is such a big subject. I think it was you, Ms. Barrados, who listed the number of commissions and studies. I think I counted 33 since 1967. There's just a kind of sense in my mind of where do we pick up this subject. I remember speaking just briefly about this study with a person who worked for five years with StatsCan. Although she liked the work and enjoyed the sense of public service, she left because there was just too much that got in her way of accomplishing what she wanted to do when she went to work each day. So now she's not with the federal government.

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I noticed that the kinds of pointers you gave us in your address today, sir, are assigning accountability and responsibility for streamlining and simplifying this. You also mention the need for better reporting to Parliament. I'm wondering if you could flesh out your ideas, Mr. Desautels or Dr. Barrados, whoever would like to do it, as to how that could be done. For me at least, after reading this report and thinking about it perhaps somewhat briefly, it's a much bigger subject than I am right now.... To go on with it, I would need a bit more help.

Mr. Denis Desautels: Maria, do you want to answer that?

Ms. Maria Barrados (Assistant Auditor General, Office of the Auditor General of Canada): Mr. Chairman, Mr. Mayfield is correct. It is a very large subject. Your original schedule had you actually speaking to some of the key players, which would help to get an understanding and appreciation of the complexity that is there.

Perhaps I can start, and my other colleagues can add their remarks. Members may have other questions.

One of the biggest frustrations we have when we look at this system is to say, it is so big and so complex, how do you change it? That is a major problem. We concluded at the end of the study that it was time that change occurred, that it should be done rapidly and that it needed to be done. The government response suggests that much more can be done within the system. In our study we are saying that a lot has been done, and it goes in the right direction, but it's just too slow. There are some fundamental things that need to be fixed.

Your question was where do you start? One of the first areas that we think really does need attention, as the Auditor General said, is staffing, the ability to hire people and bring people into the public service and to move them from one level to the other. It was our conclusion at the end of our work that the system that was now in place needed major change. That includes legislative change, and that involves, obviously, Parliament. It is not because the original legislation doesn't have flexibility in it. It's because there is so much precedence and so much that has built up around it that it has now become very inflexible and cumbersome. This is a point on which we don't have full agreement in our discussions with government, but in our view that's the only way there could be some significant change. This is a point that is well worth pursuing on its own as to the need to change staffing. This is bringing people into the public service.

You asked questions about accountability, responsibility, and reporting.

Do you want me to continue, Mr. Chairman? I don't want to get into a monologue here.

The Chair: Yes.

Ms. Maria Barrados: On the accountability and responsibility, our question is that we have concluded that there has to be this change, so who is going to lead the change? How will people agree that the change will occur? Who will make sure it gets done and followed through? We think that is an area for the clerk. There are so many people who are responsible for so many things that you could talk yourself into not doing very much. When you make—

The Chair: When you said the clerk, Ms. Barrados, did you mean the Clerk of the Privy Council?

Ms. Maria Barrados: Yes, Mr. Chairman, the Clerk of the Privy Council.

A change in one area has an impact on other areas. If you make a change in one piece of legislation, it affects other pieces of legislation. So there has to be someone who has an overview to make sure the whole system changes. That's one area where there's a responsibility and a need to move this further.

The other area that links with the Clerk of the Privy Council is the role of the deputy ministers, who are the senior managers of the departments. They formally have very little responsibility for human resource management, and it is important that this responsibility be formalized. We're not saying necessarily a piece of legislation, but a formalization so that the deputy is clearly aware of what he or she is responsible for and reports to Parliament and within the system for those responsibilities. There's also considerable tidying up that needs to occur in the other agencies.

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I put a lot on the table, but I have one last thing in terms of the reporting. The Public Service Commission is an agent for Parliament and is responsible for protecting the merit system. This is an area where there is just not enough information flowing to Parliament on what this agent of Parliament is doing in protecting the merit system.

I talked too long. My apologies, Mr. Chairman.

The Chair: No, I think Mr. Mayfield prefers that you give a full answer.

There's one minute left in your time slot, Mr. Mayfield, so you have time for a short question and a brief response.

Mr. Philip Mayfield: In that brief time I'd like to pinpoint the area of reporting to Parliament. It seems to me that there is some resistance to increasing that, perhaps for economic reasons. Cutting back on the expenses of doing it is what I was told. In any case, how do you see this essential aspect of reporting to Parliament being strengthened?

Ms. Maria Barrados: A lot of mechanisms are now in place. The performance reports and the annual reports are there. They just need better content.

Mr. Philip Mayfield: Okay. Thank you very much.

The Chair: Thank you, Mr. Mayfield.

[Translation]

You have eight minutes, Mr. Perron.

Mr. Gilles-A. Perron (Rivière-des-Mille-Iles, BQ): My question is directed to Mr. Desautels. You pointed in your report to the need to streamline the human resource management regime and to make it more flexible. You also stated on page 3 that responsibilities are fractured. Surely you have your own idea of how these objectives can be achieved. What kind of streamlining do you have in mind?

Mr. Denis Desautels: Obviously, Mr. Chairman, there are many ways of streamlining and simplifying the regime. Of course, all have major repercussions. For example, do you want a public service that is uniformly the same and where classification and remuneration systems can be applied equally to all departments?

Developing uniform systems is an extremely complex process, one that deprives departments of some measure of flexibility in managing their own human resources. Moreover, as I mentioned earlier, that is one of the reasons why Revenue Canada requested agency status, namely to acquire more independence and its own human resource management regime.

The Agency claims that having its own human resource regime enables it to recruit the people it needs much more quickly and thus to meet its own needs without having to put up with the more cumbersome staffing process it encountered in the past with the Public Service Commission. Therefore, a number of initiatives could be taken. Obviously, some would have fundamental repercussions on the very definition of the public service. Be that as it may, we believe this type of discussion is warranted. I would like to see elected officials show more of an interest in the subject because I think they are in a position to initiate the changes that are needed.

Mr. Gilles Perron: I have another question for you, Mr. Desautels. Surely you are in touch with other auditors general in Canada and surely human resources must be a topic of discussion. How does the federal system measure up against provincial systems in Ontario, Quebec or Manitoba? Are the problems encountered by the provinces similar to the ones we have here in Ottawa, or are they different? Should we think about following the provinces' lead with a view to improving the federal human resource management regime?

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Mr. Denis Desautels: I believe there is some merit to looking at what the provinces are doing and comparing ourselves to other governments in Canada. Generally speaking, there are similarities among the various governments. While the federal government regime may be broader in scope than that in place in some smaller provinces, the system is generally the same.

We can also look at what other countries are doing in this area. During the 1990s and even before then, rather significant changes were made to the way in which the public service was traditionally managed. Major changes were made in Great Britain and in Australia.

Mr. Gilles Perron: [Editor's note: Inaudible]

Mr. Denis Desautels: Overall, the regime has been simplified. The answer to that question will depend on who you ask. We found that most people who followed the changes that occurred in these countries believe the situation has changed for the better. Some would argue that the opposite is true, but I think that overall, people will tell you that change was necessary.

Mr. Gilles Perron: Thank you.

The Chair: Thank you very much, Mr. Perron.

[English]

Next is Mr. Mahoney on the first round for eight minutes, please.

Mr. Steve Mahoney (Mississauga West, Lib.): Thank you very much.

I wonder, Mr. Desautels, if you think that the stress you referred to in your presentation to us and some of the problems have to do in a general sense with the requirement in society that we have to do more with less. Would it be as simple as that to define, that we've just asked so much of our civil service in the recent eight to ten years?

Mr. Denis Desautels: Mr. Chairman, I don't think that's the real factor. Of course, there is stress in the public service because of the reductions, and that maybe brings the problems of complications and rigidity of the system more to the surface, because there are fewer people available to manage these problems. So they've made the problems, I think, more visible. Even before the downsizing, it did take much too long to fill a position that was open. I think that after the downsizing it's perhaps a little worse because there are fewer people to push the files through. Nevertheless, the main problem is still there. The cause of the delays is the undue complications of the system.

Mr. Steve Mahoney: It seems, then, that it's safe to say that the public service has managed to adapt to the changing atmosphere, if you will, in terms of the workload requirement and that the problem is really more one of reforming how new people come into the public service. Is that correct? I'm trying to get an idea of what you really mean by legislative reform. Is it that we need to improve our recruitment policies or to pay more money? Is that what we're saying? Is it that we need to seek higher-educated people? What exactly is it that we need to do to effect legislative reform?

Ms. Maria Barrados: Mr. Chairman, the picture we are painting in the study is of a civil service that is aging. The demographics are such that there are going to be large numbers going out. In the executive group the demographics are worse, and the feeder groups to the executives are also bad. At the same time, this is a public service professional group who are stretched and feel stressed, so they're not going to stay around.

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What the public service is facing is an extraordinary demand to renew itself, recruit, and rejuvenate. That's the big pressure. We didn't do a study per se of all of those stresses that the public servants have, but we're painting a picture of a public service that really does have to make big changes in the near term.

Mr. Steve Mahoney: So we're looking at a pretty large number of people who will perhaps take an early retirement package, and then we're going to have to promote from within if we can't find ways.... We're not in a high unemployment situation, and we're not going to be for the foreseeable future, assuming that the Canadian people use good sense in the upcoming event.

Ms. Maria Barrados: It's not an issue of taking packages, because there are no more packages. They are just going to have to put in their years of service and be able to retire. It could be an argument of whether or not you're providing incentives to keep them.

Mr. Steve Mahoney: That's sort of where I was going when I asked if we were paying enough money.

One of the things we did on a much smaller scale some years ago in a former life municipally is that we moved people around within the corporation of the municipality. For a year you would move from one department to another department, and people would learn other jobs and other aspects. It didn't affect their seniority or their pay. It gave them an opportunity to find out what it was like to work in the clerk's department, the engineering department, or the mayor's office. Are those the kinds of tools we could use? If they are, have discussions taken place with the unions as to the acceptability of that kind of approach?

Ms. Maria Barrados: Mr. Chairman, the kind of thing that was mentioned is a very positive initiative. Currently, there isn't very much movement between departments. There's an enormous barrier in the classification system, and that is in the process of being reformed. One of the objectives in reforming that classification system is to allow for that kind of movement.

I think that's an important issue, but the problem is still there, that the numbers are just not going to be there to do the job, and the number of people you can take in at the bottom and grow in the system is just not going to be possible.

Mr. Steve Mahoney: Is there a problem of respect or perception on the part of the public that it's not particularly a good career with regard to the recruiting of young people? There's a lot of government-bashing and demanding that we reduce the size of government on an ongoing basis. We hear it every day in question period, and we read it in the media all the time. Every level of government in this country has been reduced. Is that having a negative impact on the performance of existing staff and the ability to recruit new people?

Ms. Maria Barrados: We have seen an effect on the existing public service. They tend to be harder on themselves than people really are. That's the kind of thing you find. We found that when we were looking at their view of how well they delivered service.

We are currently doing an audit on recruitment, which will be reported on in December, and we are identifying a number of issues there in terms of the ability to recruit.

Mr. Steve Mahoney: Is there a thought that the government might be more involved at the educational level in some form to encourage programs in colleges, universities, etc. on a more proactive basis to bring young people our way?

Ms. Maria Barrados: Some of that is occurring, and we're looking at that in that audit. We're just in the finalization of that audit, so I'll wait until we finish that work.

Mr. Steve Mahoney: But you do know that's happening.

Ms. Maria Barrados: Yes.

Mr. Steve Mahoney: When do you expect to have that?

Ms. Maria Barrados: In December.

Mr. Steve Mahoney: Did you want to say something?

Mr. Denis Desautels: If I may, Mr. Chairman, in answer to Mr. Mahoney's earlier question on the image of the public service and whether or not that was a factor in recruiting or retaining people, my own view is that the job content in the public service is quite enriching. Some of the things people have to do in the public service are quite challenging and stimulating, so the work itself should be quite attractive.

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Where we fall short right now is in fact in recruiting quickly the young knowledge workers that we need in today's environment. They don't sit around for months waiting for a response, a second interview, or a job offer. The job market is very buoyant, and the private sector can turn around and attract those young people very quickly. So I think the public service has to pull up its socks in terms of its ability to attract these people quickly. I think it has a lot to offer. It has a good package to sell, but I think it has to move much faster to do so.

Mr. Steve Mahoney: Is that it? Just one briefly, you said.

The Chair: I think we'll come back. I'll give you time for a quick, brief question. Since we've just come back in the fall and the chairman was just recently elected, he will be generous and give you time for a quick, brief question, Mr. Mahoney.

Mr. Steve Mahoney: Thank you very much.

Have you seen any evidence that departments within the public service use outside consultants? I'm thinking in terms of motivators to work with the public service on personal motivation in their careers. Do you see any of that?

Ms. Maria Barrados: I've seen that, but I can't give you an informed answer in terms of how much or where.

The Chair: Thank you very much.

We'll now turn to Mr. Hearn, who we want to welcome to the public accounts committee. He is a relatively new member of Parliament and a new member of the committee.

We look forward to you making a valuable contribution. You have eight minutes. We're still on the first round, Mr. Hearn.

Mr. Loyola Hearn (St. John's West, PC): Thank you very much, Mr. Chairman. Just in commenting on your introductory remarks, I'm new to a point, but several years ago I did serve as the chair of the provincial public accounts committee in Newfoundland and for a year also as chair of the Canadian Public Accounts Committee. That was back in the 1980s or perhaps the early 1990s. So some of the setting is quite familiar.

I'd like to address a question to Mr. Desautels. Is the public service as presently structured able to do the job required at the optimum, or is that why you're basically suggesting that we have to look at restructuring and such?

Mr. Denis Desautels: Mr. Chairman, as I said in my opening statement, the reason we're bringing the subject to your attention is because this has an impact on exactly that, the ability of the public service to deliver what Canadians expect. As I've said on other occasions, we're raising those issues not because we're the defenders of the public service but because we think it's important for Canadians and Canadian taxpayers to have a well-performing public service. If we want to get value for money and to provide good service to Canadians, I think we need that. So there is an impact.

Not so long ago this committee reviewed a chapter we had done on staffing in the international tax directorate in Revenue Canada, and there was a direct link there between staffing problems and the ability of the directorate to do its job. In a very competitive and technical environment, they just weren't getting the people they needed to actually do the work, which was seen to be very important, in the way they should. So there is obviously a direct link, and I could give you more examples like that.

Mr. Loyola Hearn: All of us are well aware of the magnitude of the situation as it relates to public servants across the country, just the geography of it alone. When you look at restructuring, don't you think it would be much easier to address a department or an agency at a time? Has there been a pilot project or anything as such? Instead of looking at the total picture, which is scary even to think about.... We understand the levels of bureaucracy and the areas of political involvement that exist in trying to do anything within the public service. But if we could concentrate on sectors, wouldn't we perhaps have more success where at least you're dealing with a manageable unit at any one time just to see what the success would be? I know that would require a tremendous amount of cooperation, but if everyone is interested in improvements, undoubtedly the spirit of cooperation at least should exist.

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Mr. Denis Desautels: Mr. Chairman, if I understand Mr. Hearn's question properly, what we're talking about here in this chapter is restructuring the human resource function across all of government. We could focus, and we have done so on occasion, on how it was done within a particular entity. In a sense that's easier to tackle. The example I gave earlier of Revenue Canada was just that.

However, we decided in doing this work that we needed to go beyond that at this point in time and cover the whole system across government and describe properly the roles of all of the actors in the system and encourage a discussion on the possible streamlining of those roles. I think you can only go so far at an individual department level. At one point you have to go beyond that and deal with the bigger picture, and that's what we've tried to do here.

Mr. Loyola Hearn: I think the spirit of my question was basically to say that before you tackle the bigger picture, the various components might be easier to address. But some work has been done there, as you mentioned, and I think you can learn from that as to how it would translate into dealing with the major picture.

I think there are two big agencies that would affect that: one is government generally, and the other is the union. Is the spirit of cooperation alive and well for both agencies? Are both agencies aware of the need to do what has been suggested should be done?

Ms. Maria Barrados: Mr. Chairman, the government is more confident than we are that the right kinds of changes can be brought forward within the existing regime. They agree that there has to be change, but there is a bit of a difference as to how you do it. We have had some discussions with the unions in doing our study. Generally, the relationships with the unions have not been good, and there is a real concerted effort on the part of government to improve that.

Mr. Loyola Hearn: I think it's fairly understandable when you talk about restructuring or improvement of any type that there's always the word “downsizing” that people worry about and that unions are protecting. You can understand the concern until they see the blueprint for what is to be done.

I'll pass, Mr. Chairman.

The Chair: Thank you, Mr. Hearn.

Now we'll move on to the second round, which is four minutes. Mr. Johnston, you're a new member of the committee as well, aren't you?

Mr. Dale Johnston (Wetaskiwin, Canadian Alliance): Indeed, sir.

The Chair: So we also welcome you. The second round is four minutes.

Mr. Dale Johnston: Being long on brevity, I'm sure four minutes will be fine.

Thank you for your presentation, Mr. Desautels. I'm looking at item 4 in your presentation, “Much Study; Little Change”. Then I refer to pages 9-36, 9-37, and 9-38, in which there is a list of over 30 studies dating back to 1967, and you refer here to the 1962 Glassco commission study. I wonder if it tells us a lot about your optimistic nature that you think we're going to undertake something now that is actually going to have some results, or is this just going to be another study that will be tacked onto this list in 2001?

Mr. Denis Desautels: Mr. Chairman, this is not within my control. All I can do is report to you the results of our work. We are indeed hoping that this will not simply be another study to add to the rest.

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As Ms. Barrados was saying a few moments ago, we've had, obviously, some discussions about this with different players. We sense that government officials have an open mind on improving the system. We don't quite share their view as to whether or not there is a need, in fact, to touch different pieces of legislation for doing so, but we think there's an open mind on that.

The other important factor, of course, is the interest of elected officials. I think this is not an issue that necessarily gets top rating on elected officials' screens, I must say. So I think there's been in the past quite a bit of reluctance to devote a lot of energy to discussing legislation that affects those questions. I hope the time is ripe for that to happen at this point.

Mr. Dale Johnston: I guess maybe the way I asked the question wasn't entirely fair of me. I guess what I was driving for is what the missing ingredient has been. Certainly it hasn't been studies. We have studies galore, but we don't seem to have any results; otherwise, there wouldn't be need for any more studies. I guess you've basically answered my question on what was the missing ingredient. Apparently it's just been the interest and the political will to carry that out. Would that be fair to say, without putting words in your mouth?

Mr. Denis Desautels: Well, that is, in my view, an important factor, but not the only factor. There are, of course, complications, such as labour relations, and also different visions of what the public service should be like and how it should be managed.

Maria, do you want to add to that?

Ms. Maria Barrados: I would just add that an important element in all the discussions about what you would change is the Public Service Commission. There is some real sensitivity about whether that should be touched, whether that role should be changed, because it was set up with a special purpose. That is very much a complicating factor in bringing about changes.

The Chair: Thank you, Mr. Johnston.

And now we'll move to Ms. Jennings, for four minutes.

[Translation]

Ms. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Thank you, Mr. Chairman.

I was struck by one thing you said in regards to the issue of legislative reform. The legislative framework is so complex and has been so widely interpreted by quasi-judicial and judicial tribunals that it will be virtually impossible to undertake any kind of fundamental widespread reform of the human resource management regime without first overhauling the legislation.

You touched on the subject briefly, Ms. Barrados, when you spoke of the role of the Public Service Commission. The Public Service Commission was established with certain objectives in mind, but over time, its role has changed substantially. It has become rather cumbersome. I'm wondering if there might not be some merit to assigning to the Commission, perhaps working in concert with Treasury Board, the task of determining classifications and drafting position descriptions, of working to reduce the number of positions, of evaluating compensation for doing a particular task and of performing a monitoring function, over and above the human resource management regime of respective departments, all with a view to ensuring respect for the principles of fairness, merit, equality and non-discrimination. Would you care to comment?

[English]

Ms. Maria Barrados: Mr. Chairman, Mrs. Jennings hit the heart of a lot of the issues surrounding the Public Service Commission.

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We conclude in our study that it is important to have a function that protects merit, that maintains its independence in the human resource management regime. We pose some real questions about all the things the Public Service Commission does because they have things delegated to them from the Treasury Board. So they're involved in training and they're involved in a number of other things that normally you would not expect to see at the Public Service Commission.

The other thing about the Public Service Commission the way it currently functions is it plays two roles. It has the independent agent of Parliament role, but it also plays the role of being a member of the government management. We feel this is a role that should be really clarified. Whether it goes in the direction you suggest, Mrs. Jennings, or there's another form of this, we haven't really taken a strong position on it, but it is currently too confused. We do feel that the Public Service Commission isn't playing its role strongly enough vis-à-vis Parliament.

[Translation]

Ms. Marlene Jennings: I'll leave aside for the moment the Commission's role with respect to Parliament, because I want to focus on the human resource management issue. In my view, it's unacceptable that when a position needs to staffed in a government department and cannot be staffed internally, it can take up to six months, if not longer, to recruit someone from outside the public service. That makes no sense. No private sector company would agree to this.

To begin with, human resources is normally responsible for attending to the staffing of vacant positions and to human resource requirements. It must also oversee planning and recruitment. Often recruitment efforts lead to the hiring of a person to satisfy future needs. That person may begin working two months later, after the contract has been signed and everything is ready to go.

I worked in the private sector and in the provincial public service prior to entering federal politics. Therefore, I'm familiar with systems. I find this unacceptable. One of the reasons why this happens is that the framework is overly inflexible and complex. We haven't given the power and authority to the right individuals. In my view, action is required at the deputy minister level.

[English]

Ms. Maria Barrados: I would just add, Mr. Chairman, to Mrs. Jennings' characterization, which is quite consistent with everything we've talked about.

The story is even a little worse. Mrs. Jennings was talking about recruiting from outside, but recruiting inside—moving, promoting somebody—is also a big problem. The chart we're showing about the huge number of days it takes to staff a position refers to within the public service; so that is getting somebody to move from one level to another level.

The Chair: Even in the same office, I would presume.

Ms. Maria Barrados: If it's a different classified job. Those are the requirements that have evolved and that have to be followed. It's very cumbersome, very inefficient, and very costly.

The Chair: Thank you, Madam Jennings.

Mr. Shepherd, four minutes please.

Mr. Alex Shepherd (Durham, Lib.): Thank you.

You've touched a number of times in your presentation on the collective bargaining relationships. There's only one line in here that I can read in your actual report: “The collective bargaining regime has not functioned well.” We talk about legislative changes. To what extent are all the legislative changes we make irrelevant as long as we have the existing collective bargaining contracts in position?

Ms. Maria Barrados: There's no question that this is an issue. Some of the reluctance that some of the senior bureaucrats express to us about changing legislation is because of collective union issues that have to be dealt with. There is now, though, as I said, quite a concerted effort to improve those relationships. I think that has to be part of anything that moves forward.

Mr. Alex Shepherd: We talk about attracting new people. I know you're saying that this is another study, but I know a lot of young people plugged into the knowledge-based economy wouldn't consider joining the civil service because most of the jobs in the knowledge-based economy are not unionized. It allows them upward mobility, whereas that wouldn't happen within the Public Service Alliance. Isn't that the basic fundamental problem we have to deal with as a government?

• 1630

Ms. Maria Barrados: One of the objectives in getting the universal classification system is in fact to have much broader ranges so you can move people more quickly. There are programs to move people; it is possible. But the way we have it set up now, it's too hard to do on a large scale. So the future has to be a system that is more flexible, but it also is a future that has to have people coming in at different levels, as well.

Mr. Alex Shepherd: Has there been movement to try to change the collective bargaining process in government in the last four or five years?

Ms. Maria Barrados: There is a special committee that is set up—it's headed by John Fryer—that is working on doing that. They have issued one report, and that work seems to be going reasonably well.

The Chair: Thank you, Mr. Shepherd.

Mr. Mayfield, four minutes please.

Mr. Philip Mayfield: Thank you very much.

I'd like to come at this from a couple of different angles, if I could, to try to get a better understanding of it.

As I read your chapter beginning at about 9.17, you're mentioning the legislative core of the Public Service Staff Relations Act, the Financial Administration Act, the Public Service Employment Act, etc., and then you go on to talk about the other pieces of legislation that have been added to this. As you talk about and suggest the need for legislative reform, pretty basic stuff, are you in a sense saying that the legislation that we have now has kind of grown like Topsy, that we need to take a rational look at it and perhaps put a more appropriate legislative framework under the whole concept of the public service?

The other point of view I'd like to have your comment on is what academic interest has been shown by the outside academic experts in this field. A couple of names perhaps you might comment on: Professor Savoie at the University of Moncton, and Professor Paquet at the University of Ottawa. Do these names mean anything to you? Do you have any comments about others who may be interested in this subject that we should be reading?

Ms. Maria Barrados: Your first question, with respect to legislative reform, clearly there has to be a balance between the ideal, which would be a cleaning up of all the pieces of legislation, and what is achievable to make things workable. There has to be that kind of compromise. But we feel on the staffing area it really has to be fixed and the changes made in the other pieces of legislation. Ideally, it would be nice to have one set, but that may not be practicable.

Mr. Philip Mayfield: On that particular subject, are there other areas where perhaps some of the legislation that has come afterwards has made the previous legislation more difficult or unworkable? Is there a sense that the legislation is not conforming to do the job it was intended to do?

Ms. Maria Barrados: That is what has occurred. There were changes in 1993 that can't be fully implemented because there's another piece of legislation that doesn't have the necessary changes. That's because of this complexity in the system.

On your other question, Mr. Mayfield, on academics, there are a number of academics. I don't want to be selective and ignore some of them, but Peter Aucoin is one who has a lot of interest in these issues. Professor Ned Franks, C.E.S. Franks, at Queen's, also has a lot of interest in these issues. Professor Ted Hodgetts, who is dean of studies in public service and wrote the book Pioneering public service, has a lot of interest. Professor Kernaghan is another one. Professor Paquet from the University of Ottawa has a passionate interest in the public service. There are many more. We could give you a list if you have an interest, Mr. Mayfield.

Mr. Philip Mayfield: Thank you very much.

Ms. Maria Barrados: I may have upset some of my colleagues by not mentioning them.

• 1635

Mr. Philip Mayfield: We'll get a hold of this later, then.

The Chair: We'll add “and the rest”. If Mr. Mayfield would like the list, he will contact your office and you can provide it.

Ms. Maria Barrados: That's fine. Thank you.

The Chair: Next is Mr. Harb, four minutes, please.

Mr. Mac Harb (Ottawa Centre, Lib.): Thank you very much.

I greatly appreciate the Auditor General's report. Frankly, he does table a very interesting issue, and that is the reform of the public service.

Looking through the report, it's very self-explanatory, in a sense, as to why we can't move as fast as we wanted to. First of all, there are about 17 or 18 different governing agencies just on the management side or agencies that are overseeing the workings of the public service. You add to that the other side, which is the bargaining units that represent the public service. There again we have about 16 to 18 different agencies that are the agents for change or representing the public servant.

On top of all of this, in 1993 we had about 243,000 or 250,000 public servants, and now we have something like 145,000 or 150,000. So almost 45% of the public servants that we had in 1993 are not here any more. A good chunk of the ones we have retained are some of those who were in certain departments and wanted to go to other departments. As a result of that, the government had to put out an advertisement for those departments and develop certain job criteria and so on. That in a sense created a nightmare within the public service, that transfer from one department or agency to the next.

I don't want my colleagues in the opposition to leave here thinking that nothing has been done, when in fact the government has done a tremendous amount of work in cooperation with the management as well as with the unions who represent the public servants. I would submit that a lot has been done.

But as the Auditor General has stated, there's still more work to be done. As to whether or not we can solve all of our issues and all of our challenges only through legislative change, I don't think so. I think it has to be done through both. It has to be done through the administrative streamlining that has already begun. In conjunction with this, once we have gone through the process of consulting and working with the representatives of the employees and with the management, then whatever is left, if there is a need for legislative change, I think only then we should proceed with that. I'd really be very nervous about just moving in fairly quickly and slapping in 15 or 16 different pieces of legislation in trying to solve all of our problems.

What comes to mind here, Mr. Chair, is that at the national level it's the constitutional issue that we have dealt with and struggled with for so many years. Frankly, at the end of the day it proved that administratively you could do a lot, whereas through legislation you can't. In essence, unless we get the cooperation and support of the employees, I think we're going to have one heck of a hard time trying to move forward.

Also—and I'm sure the Auditor General could comment on this—notwithstanding all of those challenges we face, we still have some of the finest public servants in the world. In fact, we do have the finest public servants in the world.

I wanted to get a comment from Maria as to whether or not through her studies and her work she had encountered some of those challenges the government might face should they decide to move forward with legislative proposals.

Ms. Maria Barrados: Mr. Chairman, I'm in agreement that if you can make the changes administratively, you should make the changes administratively. As we say in the chapter, there is a lot that the government is doing, and it's in the right direction. When we look at the things that we feel need to be done, we've made a number of recommendations, and they're all administrative.

The one area, though, where we feel there's a real limit to administrative change and where the major changes can't occur without changing legislation is on staffing. That's the one area.

The Chair: Thank you, Ms. Barrados.

We'll now go back to Mr. Hearn.

Mr. Loyola Hearn: Thank you, Mr. Chairman. I have just a couple of brief questions.

• 1640

Getting back to the Public Service Commission, I remember that provincially there was a time when basically any position that was going to be filled went through the Public Service Commission. It was done independently. You could always count on top-quality candidates being selected. Over the years this really became a weakened institution, and it was watered down quite a lot, a lot of it perhaps by political involvement. Are we seeing a change like that also happening at the federal level, where once the Public Service Commission was more or less the be-all and end-all of hiring for the federal service, and now you have so many other players at play here that there is a taking away from the commission itself?

Ms. Maria Barrados: Of course the reason the Public Service Commission was established originally was to protect against political involvement. That's its raison d'être.

Your question was whether we have seen a weakening in the Public Service Commission?

Mr. Loyola Hearn: “Circumventing” might be the word to use. That's what we saw happening, to the point where the Public Service Commission was not able to do the job it was originally set up to do.

Ms. Maria Barrados: I would say that there are things going on in the public service that are not in the intention of the kinds of appointments that are being made. There is, though, compliance. The reason we have the complexity is because of the compliance to the rules and trying to deal with the rules and working around the rules, so that it has become just too cumbersome and heavy.

Mr. Loyola Hearn: Without getting into specifics here, because another report hasn't yet been released—we understand that it will be coming out very soon—if you look at a specific department where in structures like this you can see the strengths and weaknesses, are these things part of your report so that government is aware that things are not working right and could be done better? Do you intentionally concentrate on also pointing that out, as well as other issues you might be looking at?

Mr. Denis Desautels: Mr. Chairman, when we carry out audits in specific departments, we have to scope the audit itself and what issues we're going to cover, and human resource management issues are always considered. We have a team of people in our own office who can support the people doing the field work in the departments in the HR area. It is not something we bring up in every single examination. We have to assess how the issue ranks when we look at a particular program or department. But we have fairly regularly raised issues related to human resources in a number of our audits.

I mentioned to you earlier the example of Revenue Canada. We did extensive work as well in the whole scientific field, which brought about quite recently some significant improvements in that area. So it's always on our mind, and whenever we feel that it's a key issue in a particular program, we will include it.

The Chair: Thanks, Mr. Hearn.

Next is Mr. Johnston, four minutes, please.

Mr. Dale Johnston: I pass.

The Chair: Okay. Mr. Mayfield, you had a question.

Mr. Philip Mayfield: I have a short question, yes. Really, it arises out of a comment Mr. Hearn made. Previously I asked about who the academics are who are thinking and writing about this. Perhaps another question should be asked in the same way: Who are the people who best understand the problems? Do we need to go to the shop floor, so to speak, and ask the people who are trying to comply with the rules? Who should be involved in this discussion beyond the academics and the managers? Are there others?

Ms. Maria Barrados: There are obviously the key players: the Clerk of the Privy Council, the head of the Public Service Commission, and the head of the Treasury Board. I would say that the human resource management professionals are very important here, because they are the ones who live this system, and they have made a number of interventions within government asking for reform.

• 1645

Mr. Philip Mayfield: Are their interventions available to us?

Ms. Maria Barrados: Yes, I believe they are.

John, do you want to talk about the Human Resources Council?

Mr. John Holmes (Principal, Audit Operations, Office of the Auditor General of Canada): Mr. Chair, the Clerk of the Privy Council established three subcommittees of COSO, the Committee of Senior Officials, which plays a role in all of this. The Human Resources Council, which represents the human resource specialists in the public service, made submissions to those three committees, and those are available publicly.

Mr. Philip Mayfield: Thank you.

The Chair: Is that your question, Mr. Mayfield?

Mr. Philip Mayfield: Do I have time to ask another one?

The Chair: You were given four minutes, so you have a couple of minutes left.

Mr. Philip Mayfield: You were talking about the alliteration of restoration and reorganization. I have it in my notes, but I don't have it in my mind, I'm sorry. I really like the idea of rejuvenating the public service. Is that possible without the legislative reforms you're suggesting? If it is, how would you go about that?

Mr. Denis Desautels: Mr. Chairman, I'll start, and then I'll ask Dr. Barrados to continue.

The impression we have from talking to public service professionals and to deputy ministers, who are on the front lines as well in the sense that they have to deliver programs, is that there's a feeling that as we move into the new world, the electronic world, where we're dealing with different kinds of people coming out of university, there is a need to be much more agile in terms of responding. A number of those people will say that it can't be done unless we tweak or at least make certain changes to pieces of legislation. I think there's a need to consider that seriously. If you were to talk to some of these professionals and to those who are on the firing line, I think you'll find a lot of support for wanting to do a serious review of the existing legislative base. It's our view as well, but I think it has been confirmed to us in fairly clear terms by the human resource professionals.

Maria, do you want to complete that?

Ms. Maria Barrados: The only thing I would add is that the public service has been quite remarkable in dealing with crises. They do rally the resources and the effort, but it's very expensive. With the changing labour markets and the changing demographics, there really is a demand and a requirement for them to be more agile and flexible in order to continue to sustain a public service that has the excellence it currently has.

Mr. Philip Mayfield: I must—

The Chair: I think we're running out of time, unless you have a quick question related to the same—

Mr. Philip Mayfield: Don't we go until 5:30?

The Chair: We go to 5:30, but Ms. Jennings is still on the list.

Mr. Philip Mayfield: That's fine, then.

The Chair: We can come back, if you like.

Mr. Philip Mayfield: I'd be happy to do that. Sorry.

The Chair: Next is Ms. Jennings, four minutes, please.

Ms. Marlene Jennings: I'm a curious person, as you may have learned from coming before committees I sit on. I didn't have a chance to pull the legislation that creates the Office of the Auditor General. Is the Office of the Auditor General subject to the Public Service Employment Act? Are you bound by the rules that some of our other agencies are in terms of hiring, recruiting, promoting, etc.?

Mr. Denis Desautels: We're bound by most of that. We are in the category of a separate employer, which gives us some latitude.

Ms. Marlene Jennings: A little bit.

Mr. Denis Desautels: Yes.

Maria, do you want to be more precise on that?

• 1650

Ms. Maria Barrados: We are bound by the Public Service Employment Act. We are not bound by the Public Service Staff Relations Act. So we are a separate employer.

Ms. Marlene Jennings: But, as with all of the departments, you're bound by the Public Service Employment Act, which means that you have to work within that legislative framework. That means that even if you have some flexibility because you're not subject to the Public Service Staff Relations Act, you're still bound by a system that is largely inflexible. I've been here since we've created new administrative organizations, and I've watched how difficult it has been for that organization actually to be able to staff. It's unbelievable. So you have the personal experience as the employer—you, Mr. Desautels—as to just how difficult and complicated it can be in order to fulfil your human resources needs.

Ms. Maria Barrados: I made a mistake. Could I just correct myself here?

Ms. Marlene Jennings: Sure.

Mr. Maria Barrados: It was pointed out to me that we are under the Public Service Employment Act, but the Auditor General has the powers to take on those obligations. So we do have more freedoms because he can do things in his own name under that act.

Ms. Marlene Jennings: Rather than the Public Service Commission.

Ms. Maria Barrados: That is correct.

Ms. Marlene Jennings: So you're able to substitute yourself.

Ms. Maria Barrados: That's right.

Ms. Marlene Jennings: Is that in certain areas, or in all areas?

Ms. Maria Barrados: That's in all areas.

Ms. Marlene Jennings: But in substituting, you still have to abide by the legislation, and if the legislation is restrictive, inflexible, or burdensome, then there's only so much that you can do differently. The only difference is that you're not giving it to someone else to do the hiring. Is that right?

Mr. Denis Desautels: Mr. Chairman, I came to this position from the private sector, where I was doing comparable work. I was in a professional firm and working with professionals, and that's what I'm doing now. It was a lot simpler in the private sector, of course. Being a smaller public service organization, we can manage, but it's a challenge.

Ms. Marlene Jennings: Okay. Thank you.

The Chair: Mr. Mayfield, four minutes again.

Mr. Philip Mayfield: I was wanting to ask about styles of management and whether or not that makes a difference. I suspect that in a large organization there is a sort of master-servant relationship, in the best sense of the term, of course. I think of young people who are interested in more of an entrepreneur, collegiality style of leadership, cooperation, and service. Is the style of management that we have in the public service a benefit or a hindrance as you see it now, or is it about the way it should be?

Ms. Maria Barrados: Mr Chairman, that is one of the observations we make in here. The younger knowledge worker has a different expectation of how things work, and a number of them commented that it isn't sufficiently collegial and team-oriented. I would think that this is part of the changing management styles we're going to be seeing in many organizations.

Mr. Philip Mayfield: I was thinking of when I was still working in the church and hiring a young organist. I laid out for him the policy of that particular place and mentioned that there was a three-month probation period. He looked me in the eye and said, “You're under probation for the same period of time”. I really liked that kind of aggressive willingness to take on responsibility.

I've been so impressed with the motivation of the public servants I've encountered since coming into my job as a member of Parliament. One of the things that has distressed me, though, is how easy it is for senior managers to make a really good public servant's life hell, to cause them all kinds of distress, even to the point of them having to take sick leave. I find that kind of relationship really quite disturbing, and I'm wondering how much of that exists in our public service.

• 1655

Ms. Maria Barrados: Mr. Chairman, one of the comments we are making in the report is that there is more stress—and some of the numbers in there are among the executive group—than you would see in comparable groups. That no doubt factors in.

The other thing I would to add to Mr. Mayfield's comments is that we are moving into a different labour market. The demographics and the other competition is such that the public service will have to be able to compete in attracting and retaining young people, that next generation of public servants.

Mr. Philip Mayfield: Thank you, Mr. Chairman.

The Chair: Thank you, Mr. Mayfield. I have a couple of questions of my own.

I think the alliteration Mr. Mayfield was referring to was to renew, recruit, and rejuvenate.

Mr. Philip Mayfield: That's the one.

The Chair: You mentioned that especially the executive ranks have problems and the feeders into the executive ranks have problems, and that we may lose a significant amount of corporate memory, corporate talent and so on in that very important area.

How much did the program review of the early nineties affect the senior ranks? Did it make the situation worse, where we offered people the opportunity to bail out when we should actually have been keeping them?

Ms. Maria Barrados: Program review did have a major impact. Its impact was in one sense positive, in that there was streamlining, so there were reductions. But the other thing that occurred in program review was that there was no new hiring. The biggest impact you are seeing now is that period of freezing of all new hiring. So that is why there is this enormous demographic imbalance. Another legacy of program review, of course, was salary freezes in some of our relationships with the unions.

The Chair: But it seems to be that we only have these broad-brush responses to problems—program review, hiring freeze right across the civil service, six-year wage freeze right across the civil service. Is there any possibility that we could be a little bit more ingenious in these areas so that we can actually address the problems without coming out with these great big broad-brush policies?

Mr. Denis Desautels: Mr. Chairman, that's an excellent point.

We have seen over the years different approaches to these problems across the board—wage freezes across the board, cuts across the board, across the board this, across the board that. And these have not always worked the way they should have. But when it comes to program review, I make a different reading of that. Program review in a sense applied to everybody, but it discriminated better among situations and departments. So not everybody was hit the same way. In that sense, the basic approach wasn't bad.

There were, within program review, of course, buy-out packages, which applied to everybody. Therefore, you lost control over who went and who stayed. So that aspect we have been quite critical of. But generally, some parts of program review were done quite well, in that it differentiated very well between different departments and their respective needs.

The Chair: But we would have known, for example, that we really didn't need to lose a large number of our executive talent. Yet with program review, with the buy-outs and so on, they just took it and they went. And now we read the Strong report and we find out we have a serious problem. Now we have to buy this talent back. We have to find out how to manage without the talent.

It just seems that not a lot of real thinking goes into the development of these major changes in policy, and that seems to have created a significant part of the problems.

Can we do better next time? Is it possible? Can we learn from the past and do better next time?

Mr. Denis Desautels: I surely hope so, Mr. Chairman.

• 1700

When it comes to incentives offered for early retirement and to reduce the size of the public service, I would hope there would be no need for across-the-board programs like that in the future, and that in fact if there is a need to do any of that it can be done on a much more targeted basis within individual departments. That way you would not run the risk of losing whole classes and groups of very knowledgeable people.

I think, if anything, the incentives to retire or to reduce the public service were not targeted enough and ended up in the loss of some very valuable people.

The Chair: In paragraph 9.103 you say “Authority for most staffing actions has been delegated to deputy ministers and their departmental staff for almost two decades”. But the Treasury Board still negotiates with the unions on behalf of everybody, and you made mention of all the different committees, senior committees of DMs and so on.

How are we going to be able to build a responsive civil service if we have departments managing their own human resources but the Treasury Board does all the negotiations on behalf of everybody? Is it time we moved away from one size fits all and get into departmental union negotiations? How would we resolve this conundrum?

Mr. Denis Desautels: Mr. Chairman, this is a very fundamental question. As I was mentioning at the beginning, this forces some fundamental questioning of the current structure. I think the current structure within the core public service desires to have a fairly uniform public service so that people can move around within that public service and have fairly uniform standards of competence and quality.

We've seen models in other countries where the public service is much more decentralized, and each individual department is given a lot more flexibility in terms of its classification regime and its remuneration regime. A good example of that is in Australia and New Zealand, where they've actually turned the public service upside down in that respect.

There are different models available out there. I think it's a fundamental choice the government and Parliament have to make. Which model do they really want? At this point in time, the model being pursued, at least for the core public service, is a fairly uniform public service.

The Chair: I agree with you that we have this centralized model, but right here on Parliament Hill we have the drivers of the Senate buses making more than the drivers of the House of Commons buses. We'll not get into the debate about why we have two separate bus systems, but because one set of drivers belongs to a different bargaining unit they get paid a different rate of pay. I'm scratching my head, saying that we have this centralized concept, and we have people doing identical jobs in an identical place, basically working almost identical hours, and yet the rate of pay is different.

We've got the worst of both systems, I think, where somebody has lost control of what the left hand is doing while the right hand is doing something else. We've got a very centralized, silo type of public service management, and it all falls out into.... The union is very militant—I'm thinking of PSAC, very militant—adding rules and conditions and the government is buying into them. How do we get out of this mess? Any suggestions?

Mr. Mac Harb: What mess?

The Chair: Well, as the Auditor General said, we have all kinds of legal precedents that tie all kinds of different hands. We have union agreements that are inches thick, and 16 different unions with 16 different sets of rules and regulations and agreements that are binding. We now have UCS, the universal classification system, to try to get us out of that. We spun off Revenue Canada into the CCRA to make them a separate agency so that they can get themselves out of their own human resources tangle, which we have debated right here in committee, where it would take months and months, if not years, for somebody to be reaffirmed in a higher position. We have ourselves in a real mess. Do you have any suggestion as to where we start?

• 1705

Mr. Mac Harb: It's all in your mind, Mr. Chair. There's no mess at all.

The Chair: Okay. Let's hear from the Auditor General.

Mr. Denis Desautels: Mr. Chairman, the fundamental message of our study is that there is a need to simplify and clarify the respective responsibilities of the major players in this system. So I think the emphasis should be on simplification, and we should be very careful in the future not to further complicate the system, for one thing. The universal classification standard is an example of an attempt to simplify. We will be reporting on that to you in the near future, and we hope that project will come to a successful conclusion.

I believe there is a need to have an honest and sincere review of the current structures. The people we've talked to in the public service, as I said earlier, have expressed a lot of frustration with the current system. The people who have to make that system work would like some help in making it more efficient.

I don't want to go into more details of how to do it. I think our chapter does point in a number of directions. But I think it would be quite useful if the committee could hear from some of the other major players that you have invited. I hope these meetings will happen. I think it will shed a lot of light on the issues. I think you'll be able to see that while there is not unanimity on the solutions, there is a fair amount of consensus on the need to improve the system. When we were doing this work, in our discussions with the people who will be coming in front of you we found that in general they agreed with the essential messages of our study.

The Chair: We're decentralizing departments through FIS and giving more autonomy to the deputy ministers to manage their departments. We now have in the last couple of years performance reporting on a departmental basis, and, as you mentioned, the departments are getting more and more authority to manage their own human resources. Do you have any comments on how we can protect and stimulate the notion of merit in the public service?

Ms. Barrados and you mentioned that in the new world, this modern world we now live in, the younger people especially are looking at rapid career changes. They're looking for upward mobility, and they can move from employer to employer to employer to employer with the notion that they can elevate themselves up the career ladder. But we are going to be seen to be stuck in the 19th century, with it taking 230 days, I think it was, according to your paragraph 9.8, to staff a new position in the public service by someone who is already employed by the civil service. This is without going outside to hire a new person to fill a new position. That's seven months, and some positions in the private sector can come and go in that time. How do we move this agenda forward so that we can address the needs of these younger people who are fast and mobile, and if an opportunity presents itself, they take it?

Ms. Maria Barrados: Mr. Chairman, that's why we're so strongly making the case that streamlining and some major reform on staffing have to occur. One of the things that is now going on is that people spend an awful lot of time and energy to work in the system and to try to work around it and be in compliance yet really not do quite what was intended. So they're making a lot of use of things like term and casual employment to get a permanent position in the public service. So it is very important that there be change.

• 1710

What fundamentally has to happen—and everyone agrees with this, it's just the question of how you do it where there may not be quite the agreement—is that we have to get away from a system that is so rule and procedure bound to something that is described in general as values-based or principles-based, and that you have to meet those principles and values but without giving a long list of procedures you must always go through. So the focus is on achieving those principles. Everyone agrees that has to be done. What we have to do is move forward and get that done.

The Chair: I think on that point I'll bring my comments to a close, and I think all the other members around the table have exhausted themselves.

Before we hear the Auditor General's comments, as you are aware, next week is a break week. On October 17 Mr. Desautels, the Auditor General, will be bringing down another report. Two days after that, on the Thursday, we will be hearing from the Auditor General at the public accounts committee on that new report he has produced. That would put us back another week, and as Harold Wilson, the Prime Minister of Britain, I think it was, said, a week is a long time in politics. So we'll see what happens that far out as far as the calendar is concerned.

My clerk mentioned that he always buys new batteries for his clock at the beginning of every session, and they just died today. Whether or not that means anything, I don't know.

We will wrap up with some closing comments by the Auditor General.

Mr. Denis Desautels: I'll make two fairly brief comments.

First of all, I think, as Mr. Harb pointed out, that a lot of changes have been made in the last few years, a number of attempts to streamline, and in fact the core public service has been reduced substantially. But that's a double message in some ways, because although the core public service has been reduced, those public servants have not disappeared all of a sudden. They're still out there somewhere in a slightly different regime. The reason they were put in a different regime is because there were problems with the existing regime for the core public service, among other things. Despite the changes that have been made, there's still a fair amount of frustration out there.

This brings me to my second point, and that's the issue of what I would call the 90% syndrome. We often hear the argument that 90% of the changes that need to be made to make things function efficiently can be made without a change in legislation. The problem with that is that becomes almost a reason for not touching the legislation, and it reduces the incentive to want to touch the legislation. Conversely, it sometimes is still a reason for not proceeding with the 90%, that we can't do this unless the legislation is changed. So it's a two-edged sword. I think in future discussions that's the issue that needs to be pursued: Is it absolutely essential, desirable, or what to touch the legislation to make the system function as it should?

I will leave it on that note, Mr. Chairman.

The Chair: Thank you, Mr. Desautels.

As I indicated, at this point in time the calendar says that our next meeting will be an in camera meeting for all members of Parliament when you table your report on October 17. Yesterday the Prime Minister was adamant that we will be sitting on that day. So we look forward to that.

The meeting stands adjourned.