PACC Committee Meeting

STANDING COMMITTEE ON PUBLIC ACCOUNTS

COMITÉ PERMANENT DES COMPTES PUBLICS

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, May 17, 2001

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[English]

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

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.

Our witnesses today are from the Office of the Auditor General of Canada, Ms. Sheila Fraser, the Interim Auditor General of Canada; Ms. Maria Barrados, the Assistant Auditor General; Ms. Kathryn Elliot, Principal, Audit Operations. And from the Privy Council, we have Mr. Mel Cappe, the Clerk of the Privy Council and Secretary to the Cabinet; and also from the Privy Council, Mr. Ranald Quail, Deputy Minister and head of the Human Resources Modernization Task Force.

Welcome all. We will start with the opening statement from Ms. Fraser, please.

Ms. Sheila Fraser (Interim Auditor General of Canada, Office of the Auditor General of Canada): Thank you, Mr. Chair.

I would also like to thank you and the committee for this opportunity to discuss the results of our study on “Streamlining the Human Resources Management Regime: A Study of Changing Roles and Responsibilities”, as reported in chapter 9 of our report tabled last April. As you mentioned, I'm accompanied today by Maria Barrados, Assistant Auditor General, and Kathryn Elliott, Audit Principal.

As we have noted in the past two hearings, the current framework governing human resource management in the public service is unduly complex and outdated. Administrative systems are cumbersome, costly, and outmoded. The framework is not suited to an environment that requires the flexibility and adaptability of today's rapidly changing working environment.

The staffing system, a major source of frustration for managers, employees, and those seeking employment with the public service needs to be streamlined. As we discussed this past Tuesday with Treasury Board Secretariat, the classification system needs to be modernized. The many pieces of legislation regulating aspects of human resource management need to be reviewed in order to simplify them. Concerns about fragmented responsibility for human resource management are longstanding. In chapter 9, we outlined the number and role of players in human resource management. We noted that a significant portion of the core public service had moved to agency status in the past few years, a major driving force being escaping from the current complex human resource management regime. Unfortunately, this move has not addressed the basic problems of the existing system.

In the current situation, deputy ministers are primarily responsible for administering essentially a prescribed framework in their departments through a delegated process. However, their responsibilities of human resource management and the accountability for results are not clearly spelled out. The government needs to examine the roles of the central agencies and their relationships with departmental deputy ministers and determine what needs to be legislated, what is to be delegated, and what the accountability regime will be. We also believe that all parties—central agencies and departments—need to significantly improve the reporting to Parliament on the quality and effectiveness of human resource management and thus of the public service.

[Translation]

The capacity of the public service to deliver results that meet the expectations of ministers and Canadians depends on its ability to attract, develop and retain highly skilled people. Key to doing these three things well is an efficient and effective human resource management regime. The situation is critical because the public service work force is aging, and renewal is essential.

We need legislative and management frameworks that provide the necessary flexibility and adaptability to manage human resources in a changing and increasingly competitive working environment while maintaining basic public service values and ensuring accountability. Reform is critical because the current system is not adroit and will not allow Canadians to maintain the high standard of public service it has come to enjoy.

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We welcome the recent announcement by the Prime Minister of the formation of the Task Force on Modernizing Human Resources Management in the Public Service, headed by Mr. Ran Quail. We support the establishment of the proposed External Advisory Group from the private, public and academic sectors to provide expertise and advice.

[English]

We look forward to the proposals from the Clerk of the Privy Council, Mr. Cappe, and the chair of the task force, Mr. Quail, on how to address our concerns and those of others.

Furthermore, with the support at the political level, as indicated in the Speech from the Throne and the commitment of Minister Lucienne Robillard as minister responsible for human resource management reform, there is a good opportunity to make real progress.

We view the timeframes established to be very tight. Buy-in of all stakeholders will be important to avoid repeating mistakes of the past, and the current difficult labour relations environment adds to this challenge.

We hope the report to be produced by Mr. John Fryer will provide some options for improvement, which can be incorporated into any legislative reforms.

We believe this is a major initiative undertaken by government designed to lead to important legislative changes.

We encourage this committee to stay informed of progress on this important matter over the next year and a half.

Mr. Chair, this concludes my opening statement. We will be happy to answer any questions of the committee.

Thank you.

The Chair: Thank you very much, Ms. Fraser.

Now we'll turn to Mr. Cappe. You have a fairly long opening statement, Mr. Cappe. Are you going to summarize this? What's your intention?

Mr. Mel Cappe (Clerk of the Privy Council and Secretary to the Cabinet, Privy Council Office): I assume that my opening statement has been distributed and can be on the record. I would like to summarize and make four points, if I may.

The Chair: Absolutely. It has been distributed. I'm sure everybody has received the report. The clerk has distributed it, and it will be, for the record, attached to the minutes of the meeting and therefore available, if anybody needs a copy of the full contents of the report. So we'll ask you to summarize.

Mr. Mel Cappe: Thanks, Mr. Chair.

[Translation]

I wish to comment on four things. First, the public service is important in that a strong, impartial, representative, bilingual and national administration is required to deliver high-quality services to Canadians and impartial, professional advice to ministers.

The government stated the following in its Throne Speech:

To assist the Government in fulfilling its responsibilities, Canada must have a public service distinguished by excellence and equipped with the skills for a knowledge economy and society.

Secondly, many studies have already been conducted. As the Chair of this committee stated, now is the time to take action. In 1962, the Glassco Commission underscored the need, first, to clarify the roles and responsibility of all those involved in human resources management. This echoes what Ms. Fraser said.

Second, it determined that greater responsibility must be placed in the hands of human resource managers. We need to find a way to achieve these two objectives.

[English]

The third point is we're making progress. There is improvement. If you look back over the last thirty years, you'll find that we have actually ameliorated the management of human resources, and in the last five or ten years I think there have been significant improvements.

But we've come to the point where... Over the past ten years we've had legal changes and we've had increased delegations to managers and to departments, but I think now is the time for more profound legislative change. So that is the fourth point. We are now at a point where, as Ms. Fraser said, the labour market has changed, and it's time to modernize the legislative framework of the public service human resource management.

If I may, Mr. Chair, I would end by just pointing to my annual report to Parliament, which was tabled March 31. On page 14 I note that there will be four guiding principles to modernizing human resource management legislation. I'll just cite, if I may, the four points.

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First and foremost is the protection of merit, non-partisanship, representativeness, and competence. Second, management—and that may be the Treasury Board as management, deputy ministers, or a front-line supervisor—should be responsible for all aspects of human resource management. Third, authority for human resource management should be pushed as far down in the organization as appropriate, and fourth, managers should be held accountable for the exercise of their responsibilities.

I plan to have an external advisory committee from the private sector and other interest groups who will provide advice to myself, Mr. Quail, and the minister. As well, we'll be consulting widely, and I should just note that Mr. Quail has already met with the unions in the presence of the Secretary of the Treasury Board.

With that, Mr. Chairman, we will be pleased to answer any of your questions.

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

[Translation]

You have eight minutes, Mr. Cardin.

Mr. Serge Cardin (Sherbrooke, BQ): Thank you, Mr. Chairman. I'm a last-minute substitute for one of my colleagues. I won't pretend to be thoroughly versed in the audit report or for that matter, in your report, Mr. Cappe. Nevertheless, I am surprised by several things.

The figures show that there were 243,000 public servants in total in 1993 and 143,000 in 1999. The workload, however, has remained unchanged. From this we can draw two possible conclusions: either there were too many public servants in 1993, or if the numbers were fine and people had a normal workload, work methods have certainly changed today. To eliminate 100,000 jobs and expect the same output... I'd like some additional explanations. Have work methods changed or is it that there wasn't enough work for people in 1993? Are today's 143,000 public servants overworked? Is the federal government's policy perhaps taking matters a little too far? Are needs being met? Would we still need to increase the number of public servants if everyone did their job and applied themselves in their own area of expertise?

Mr. Mel Cappe: Mr. Chairman, let me respond to that by citing several examples.

First off, where did Mr. Cardin get his figures? If we're referring to the traditional or core public service, then these figures are more or less accurate. However, the problem is drawing comparisons further to the creation of special agencies such as the Canada Customs and Revenue Agency, Parks Canada and the Canadian Food Inspection Agency. These three agencies are part of the overall public service, but they are not subject to the provisions of the Public Service Employment Act. It's important to make that distinction. The figures, therefore, are not exactly comparable.

Nevertheless, the size of the public service has shrunk considerably, as noted by the Auditor General in his April 2000 report. The later contains on page 913 a reference to a survey by APEX, an association of senior executives, of its members who reported that they were overworked.

The program review conducted in 1995, 1996 and 1997 saw cutbacks in the public service, along with a reduction in the number of public servant jobs, fewer responsibilities and leaner budgets. However, workloads are still heavy and public servants need to find ways of performing their duties more effectively and efficiently. It's an ongoing process.

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Mr. Serge Cardin: So, if I understand correctly, when you refer to the number of employees, you're talking about the people who work for 20 departments and 60 agencies, more or less.

Mr. Mel Cappe: That's correct.

Mr. Serge Cardin: Does this figure of 143, 000 not include employees of the various agencies?

Mr. Mel Cappe: No. I'm talking about those workers subject to the Public Service Employment Act. Parks Canada, the Canada Customs and Revenue Agency and the Canadian Food Inspection Agency have, pursuant to their enabling legislation, their own human resource management regimes in place. Therefore, these 135,000 employees are not part of the core public service that is governed by the Public Service Employment Act.

Mr. Serge Cardin: I'm sorry, but I neglected to welcome you and to point out that female witnesses are in the majority here. How enjoyable. I see that employment equity is already at work.

Mr. Mel Cappe: Next time around, the reverse may be true.

Mr. Serge Cardin: Perhaps.

Generally speaking, do you agree with the findings or views expressed by the Auditor General? Do you humbly accept them, with a commitment to do better?

Mr. Mel Cappe: I do humbly accept them. Before the meeting began, I was saying to your chairman that I more or less agreed with the report's findings. In fact, I could quote from several of the reports. The April 2000 and the December 2000 reports both discuss human resource management. Moreover, the final report tabled by Mr. Desautels a few months ago also focussed on human resource management and on the state of the public service. I can't say that I agree with all of the recommendations, but I do agree with the direction taken in the report and with its overall findings.

Mr. Serge Cardin: Then, you're saying that while you are not 100 per cent in agreement, you are heading in the same direction. In your estimation, how long will it take you to rectify the situation?

Mr. Mel Cappe: As I was saying, I think we've conducted enough studies. As I was researching the subject, I came across quotes from previous studies. The Glassco Commission, a royal commission dating back to 1962, voiced some of the same criticisms as did the AG recently. Changes were subsequently made in 1967, but the time has come for even more radical changes. We don't need broad studies. We are hoping to come back to the House of Commons in 18 months' time with a bill to overhaul the system.

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

You have eight minutes, Ms. Jennings.

[English]

Ms. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Thank you, Mr. Chair. Thank you very much for your presentation.

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I have to say that I'm pleasantly surprised and happy to hear you say, Mr. Cappe, that the direction the Auditor General's overall recommendations suggested the government go in, in terms of the human resources management regime, is a view you share. That's very good news.

As you probably know, I've read the Auditor General's report, chapter 9, back to front several times. I've also read the Perinbam task force report front to back several times. We've also had discussions before in this committee on how the government is doing in ensuring our human resources, our public service, is in fact representative of the Canadian population.

My first question to you as titular head is on the issue of the census figures being used as the basis for determining active labour participation—for instance, of visible minorities. A significant demographic study on the 1996 census showed that it underreported the presence of Canadians of African origin—either several generations back or just one generation—by 40%. That's significant.

It was done by Dr. Jim Torczyner of McGill's social studies centre. If you're interested, I can arrange for you to receive a copy of it. I'm familiar with it, because I sat on this study's national steering committee.

It has immense implications in terms of the results, because when one looks at the Public Service Commission's report on equity employment as it pertains to visible minorities, Perinbam already says it's not a great picture. It's even more dismal if we take into account that it's based on the 1996 census, and most people who have looked at the demographic study on Canadian blacks agree that there was an underreporting in 1996 of 40%.

First, I would strongly suggest you take cognizance of this study and look at whether or not the 2001 census addresses this problem. I'm not confident it does. That's one point.

My second point is that it's clear our human resources system is suffering from bipolar disease. That's the most polite way I can say it.

Do you favour having the responsibility for hiring and staffing and promotion come under the deputy ministers, with the Canadian Public Service Commission providing expertise in much the same way as you would have with an outside consultant—an industrial psychologist say who assists you in evaluating candidates, etc.—but that the actual staffing responsibility come under the departments themselves? They determine what their needs are. They actually do the recruiting.

Obviously the Public Service Commission should provide general guidelines and principles that have to be respected, but when you talk about driving it down as far as you can, human resources management, there's no point in this if the ultimate decision in terms of recruiting and hiring is with an external body.

So that's my first question.

Mr. Mel Cappe: First of all, Mr. Chairman, I was not aware of the study and will indeed look into it.

With respect to Ms. Jennings, I must say that if we were meeting the census numbers, then I would really be worried about it. But I have a lot more to be worried about, because we aren't even at the level of the census numbers. There's a very serious and fundamental issue we have to deal with here. The underreporting is the least of our problems in a way. Nevertheless, it gives us a sense of the size of the challenge.

On the question of where the responsibility should lie—and I don't want to prejudge the outcome of the work of Mr. Quail and the task force—I'll try to answer the question as directly as I can.

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When I talked about the guiding principles that I've reported to Parliament on already, I was struck by the need for—and the words were carefully chosen—first and foremost, the protection of merit. And I don't think anyone would suggest that we undermine this principle; rather, merit needs to be understood in a larger and more realistic fashion.

I've said this principle needs to include the protection of merit, non-partisanship, representativeness, and competence. I start off saying the number one principle—and it's number one for a reason—is indeed to have this.

I'd add the caveat that I actually don't like the term “representativeness”, because it makes it sound like there's a rights-based duty to make the public service representative of the people. I prefer the notion of diversity, because it is the contribution to improved output. It's because a diverse public service will generate better service to the public that we really want to do it. Both objectives exist: one is to be representative, but almost more importantly, it's to have a diverse public service to improve the quality of the service and the advice going to ministers, and I support that.

Really, the answer to your question is found in those second and third principles. Management should be responsible, not a third party, and frankly, responsibility should be pushed as far down as possible within management within departments.

You asked whether deputy ministers should be responsible. The answer is yes. They should be responsible, but they should be responsible for a system that allows a front-line manager to actually go out and hire someone.

But I would come back and say the fourth principle is that they should be held to account for it. The role of the Public Service Commission could well be to ensure that that first principle of the protection of merit, non-partisanship, representativeness, and competence is attested to.

Ms. Marlene Jennings: You've prejudged already. But I just had to—

Mr. Mel Cappe: That was before the task force was—

Ms. Marlene Jennings: —tweak it out of you.

Mr. Mel Cappe: Yes. Exactly.

Ms. Marlene Jennings: Okay. Thank you very much. I do appreciate that.

Mr. Quail, hello.

Mr. Ranald Quail (Deputy Minister and Head of the Human Resources Modernization Task Force, Privy Council Office): Hi.

A voice: This sounds ominous.

Ms. Marlene Jennings: Not at all. Not at all. I'm in a particularly good mood today.

Mr. Mel Cappe: You're lucky.

Ms. Marlene Jennings: I heard that, Mr. Cappe.

Mr. Quail, you're heading a task force. You're going to be coming back with a report and a series of recommendations on how to reform our human resources management regime in a way that allows us to meet the challenges of the 21st century and ensures that the Canadian government continues to do what it has a responsibility to do—provide services and policies and delivery programs to Canadians from sea to sea to sea in an equitable and efficient fashion, a fashion that shows us you are using the Canadian taxpayers' dollars wisely.

In the process, will you be consulting members of ethnocultural communities who have demonstrated either a real interest or an expertise in equity employment as it pertains specifically to government?

Mr. Ranald Quail: I have a couple of points. Number one, to clarify, we'll not be producing the report. The end result we're driving towards is a piece of legislation—

Ms. Marlene Jennings: Okay.

Mr. Ranald Quail: —for consideration—

Ms. Marlene Jennings: Better yet.

Mr. Ranald Quail: —of members of Parliament.

Ms. Marlene Jennings: Better still.

Mr. Ranald Quail: The second issue then becomes the task force's bias for action, taking what has already been written for a long time, taking out of that material—sifting out of it, culling out of it—recommendations, putting it in a modern context, and producing a proposal for cabinet to consider. If they agree, we'll draft the legislation.

On the question of the degree of consultation, in order to do the work of the task force, we have, to say the least, a challenging timeframe. Our target for tabling the legislation is before summer recess in 2002.

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If we're going to go through the various reports and produce what I've talked about, staying on time—and time is of the essence, because what we have is not workable in today's society... Consultation is an issue we haven't concluded, first of all.

Second, we are concerned about how we talk to employees, how we talk to all of the employees. We're concerned about how we interface with or talk to the unions. On the issue of how we would attempt to have views—as opposed to having consultations or input—we've been looking at the possibility of having a number of round tables across the country. These round tables would again try to cover off a cross-section of our population, including the one you've been talking about.

The Chair: Thank you, Mr. Quail.

Thank you, Madam Jennings.

Ms. Marlene Jennings: I have a question.

Would you welcome suggestions on who to invite as representatives to these round tables?

The Chair: I'm sure Mr. Quail would never turn away suggestions.

Mr. Ranald Quail: The answer would be yes, but there's also the National Council of Visible Minorities in the Federal Public Service of Canada, an existing organization of public service employees, and they are on our radar screen already.

The Chair: Thank you.

Mr. Murphy, we're moving on to the second round. Like Madam Jennings, we may be in a good mood and go to a five-minute round rather than a normal four-minute round.

We'll go to Mr. Murphy, please.

Mr. Shawn Murphy (Hillsborough, Lib.): Thank you very much, Mr. Chairman.

My question is for Mr. Cappe and Mr. Quail.

First of all, I'm a relatively new member of Parliament and I haven't yet figured out how this whole system works, but I've been here long enough to know that I will probably figure it out.

Mr. Mel Cappe: I've been here 25 years and I'm still working on it!

The Chair: As long as the paycheque arrives, it's working.

Mr. Shawn Murphy: In any event, from everything I've read, the Government of Canada is struggling on this whole issue of HR management. It's been going on for a long time now and there have been reports and studies and commitments that seem to have gone by the wayside. I have three questions to help put it in perspective in my own mind.

We have had testimony from the Public Service Commission; from you, Mr. Quail; and also from Treasury Board. First, I want confirmation: is it Mr. Quail who will be responsible for this whole modernization of HR management? There has to be one person responsible. Is it Mr. Quail?

The Chair: Mr. Cappe, perhaps you can tell us how much authority Mr. Quail has.

Mr. Mel Cappe: All the authority he needs. Mr. Quail is working on the legislative reform of the public service human resource management regime.

Mr. Shawn Murphy: That's really not an answer.

If we come back here in 24 months and the Auditor General files another report and states there's been no satisfactory progress made in this whole area, who will have dropped the ball, who will have fumbled it? Is it you, Mr. Cappe? Is it Mr. Quail? Is it Mr. Serson? Or is it someone else?

Mr. Mel Cappe: Yes!

Some hon. members: Oh, oh!

Mr. Mel Cappe: I don't mean to be flippant, Mr. Chair.

I would go back to the announcement made by the Prime Minister when this was established. In the announcement he asked the President of the Treasury Board to take the lead in bringing forward legislative reform.

If I may take the opportunity now, I would say that we see this happening in two tracks simultaneously. One is Mr. Quail working on the legislative reform Madame Robillard will bring to Parliament as a bill. But at the same time, within the existing Public Service Employment Act, there are still changes and modernization initiatives we can take. The President of the Treasury Board is committed to bringing those forward. Mr. Claydon mentioned earlier this week that he was also working on some elements of this.

There will be this legislative track and an administrative track, and both of them will be going simultaneously.

Mr. Shawn Murphy: Mr. Cappe, this is a very difficult task, very complex—and it's a moving target, too. Everything's moving out there. That's my point. If there isn't anyone who is solely responsible for bringing the issue from A to B, and then from B to C, I can't see it getting done. I can't see how you can go in parallel and with different tasks. Somebody has to say to this committee, I'm the person who's responsible for the effective delivery of this initiative. If it's not delivered, I somehow dropped the ball.

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Mr. Mel Cappe: As to the legislative reform, all I can do is reiterate and clarify the rules. The press release was quite clear that the Prime Minister has asked Madame Robillard to bring the legislation in. I am trying to coordinate some elements of this. Mr. Quail is working on the legislation and reporting to me.

But I will not tell you that I'm responsible for the existing laws that are carried out by the Public Service Commission under the Public Service Employment Act. They are the ones responsible. The Secretary of the Treasury Board is responsible for administrative policy in the public service.

I agree with you that it's complex, and I can't give you a simple answer, I'm afraid.

The Chair: Maybe part of the problem is the fact that there's no simple answer, Mr. Murphy.

Mr. Shawn Murphy: I think the basic problem is that there's a systemic organizational problem as to responsibility and accountability.

My next question, if I'm allowed, is since the government has decided to embark upon this very complex and difficult task, would it not be wise to have a very clear critical path showing that you're going to be at this stage by the end of May and at this stage by September, etc.? That way, if you're off the rails after six months, we'll know you're going to be off the rails after 24. Would it not be good for parliamentarians and everyone involved to have a very clearly defined critical path as to what stage we're going to be at, at certain points in time?

Mr. Mel Cappe: I'd like to tell you the date we're going to pass the legislation, but that would presume certain things about Parliament. As Mr. Quail said, we would like to be in the House of Commons with legislation by the summer of 2002. The Auditor General's recommendations make it clear that this isn't a particularly partisan issue. It's something that is about service to the public and the state of the public service. I think we can meet that test. We have our own agenda of getting into cabinet for approval of the policy, getting the legislation drafted, and then getting into Parliament by the summer of 2002.

The Chair: Thank you, Mr. Murphy.

Next is Mr. Shepherd for five minutes.

Mr. Alex Shepherd (Durham, Lib.): Mr. Cappe, the last three of your four points revolve around the theory, let the managers manage. All the previous studies talked about letting the managers manage. But we've had this problem of the way people look at so-called responsible government. This is where there's a huge conflict. In other words, if we allow managers to manage and they make mistakes, then somehow it becomes the responsibility of a minister. This seems to be a big problem. The ministers then have a tendency not to delegate all that managerial responsibility throughout the organization.

So if that's your objective, how are you going to solve that dilemma? I think there are some very specific examples of where this has happened in the public service. Somebody was responsible for something, but in reality it reflected badly on the government and so forth. Therefore, we decided we didn't want to delegate all that responsibility. In some ways you don't have to just change the culture within the public service, you have to change the culture within the country.

Mr. Mel Cappe: I think you put your finger on one of the essential elements of this. One of the reasons we have, if you will, an overdetermined system with the nature of the legislation we have is that we try to minimize the number of mistakes. We think we can do that by predetermining what the actions of managers or staff at any level might be. The fact is that the more you do that, the more you reduce accountability, in effect.

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When you have legislation such as the Public Service Employment Act, which specifies all the steps to go through, you try to make it risk free, and then people are afraid to take responsibility. So I think that with the notion of making people responsible and at the same time holding them to account, which is the essence of what this committee does, you have to operate on both sides. I think that's consistent with the direction the Auditor General has recommended; that is, you give people the tools to do their job but then hold them to account for the job they do.

Mr. Alex Shepherd: I understand that within the concept of the public service. How does that then interface with the concept of so-called responsible government when in fact the person in Regina with the delegated responsibility screws up and costs us money or something, yet the minister here in Ottawa is the one who's going to take the heat for it? How are you going to resolve that issue?

Mr. Mel Cappe: If it were easy, we would have already done it. So I don't have a magic bullet.

In a sense we've done it with financial management. With the move to modern comptrollership, which the President of the Treasury Board has introduced, we're telling managers that the Treasury Board will not prejudge the decisions that are being made, but we will have a regime that allows for responsible financial management. Then we'll hold you to account for how you spend the money.

We don't have that principle applied yet in human resource management. If we could in a sense borrow from financial management and apply it to human resource management, I think we could be fairly successful.

Back in the sixties the Treasury Board used to receive 20,000 or 30,000 submissions, which used to be secret, asking for the authority to go out and buy pencils and pens. We've now moved to a system that has cut that by a factor of 10, and we've said to managers, go out and be responsible. We now allow people to go out and buy pens. We think we can trust them to do that. On the other hand we're going to hold them to account for it. The people who buy pens from their brothers and sisters are going to be punished.

Mr. Alex Shepherd: How are they going to be punished?

Mr. Mel Cappe: Under the financial management and contracting authorities, we have rules that say people are held to account for those decisions. If they violate those principles, then they are disciplined, and ultimately they can be suspended.

Mr. Alex Shepherd: The way the public service is currently constituted is that we have the leadership training group, the Public Service Commission, and the Canadian Centre for Management Development. There seems to be a whole bunch of people involved in the same thing. Is there a need for all of these separate groupings? I think of a large multinational corporation. They look at their human resource element as one employment sector. They don't partition it off. Is that something you're thinking about getting rid of?

Mr. Mel Cappe: The Auditor General and all the previous studies have recommended some rationalization, and we are trying to rationalize. In fact, we have already done one thing. The leadership network, which was a stand-alone agency, has been essentially rolled into the Treasury Board Secretariat. It will be kept as a separate unit within the Treasury Board Secretariat, but it will allow for some rationalization and some synergies across these agencies. So there is an intention to do that.

But even if you go to the private sector, you'll see, for instance, that Xerox has a separate university and Chrysler has a separate training school. So having some separate institutions is not necessarily a bad thing. You do want to make sure they work well together. The more we can rationalize this, the better. Right now the employer functions are distributed broadly across these agencies, and we should try to consolidate them.

The Chair: Thank you, Mr. Shepherd.

We'll now go to Mr. Bryden for five minutes.

Mr. John Bryden (Ancaster—Dundas—Flamborough—Aldershot, Lib.): You just mentioned that managers who buy pens from their brothers and sisters will be disciplined. How will you know?

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Mr. Mel Cappe: We have practices of internal audit where each department has an internal audit organization and they conduct audits. As well, we have my colleagues here who audit the practices within departments. My experience has been that we tend to find these things out.

Mr. John Bryden: Let me put it another way. You say you tend to find these things out, but do you know the things you don't find out?

The Chair: They don't know, Mr. Bryden.

Mr. John Bryden: It's very relevant.

Mr. Mel Cappe: It's a serious point.

Mr. John Bryden: We always say we don't have a problem because the problem doesn't show on the radar screen. My very direct question to you is in this package of reforms of the civil service here you're looking at, are you factoring in reforms to the Access to Information Act? Are you factoring in reforms pertaining to the transparency of operations?

Mr. Mel Cappe: On the first point, I should mention that the Minister of Justice and the President of the Treasury Board have announced a task force to look at the Access to Information Act, so as such, I don't think we'll be looking at the Access to Information Act.

Having said that, your second question was more general. It was on the question of transparency. In that regard, I think it would be a principle that would help guide us as we design our systems. Earlier Ms. Jennings was asking about hiring practices, and the issue of transparency comes into that.

So I would like to say yes to the second question and no to the first.

Mr. John Bryden: Where I come from on this is the experience in Human Resources Development pertaining to famous files that caused all the controversy. I quite accepted that Human Resources Development really believed it was doing a very good job. I still believe they believe that.

But what happened was the minister took it upon herself, as I understood it, to release about 10,000 files. With some I found in my own riding that there were competency problems in the awarding of grants and contributions. I perfectly accept that this is the risk of that kind of program. Mistakes are going to occur. But I was also terrifically impressed by the fact that efficiencies occurred because suddenly these files were released.

Being aware of your very high role in the civil service, my question is really one of principle and philosophy. I realize you are not directly involved in the task force and that it's a Justice Department-Treasury Board undertaking, but you are involved in setting the tone of the civil service at large. Is there a lesson to be learned in Human Resources Development that can be applied to trying to hold managers accountable and to testing for competence, as suggested in your four points?

Mr. Mel Cappe: Yes. But may I point out that it was the internal audit group within HRDC that did the original audit and it was the minister who made that audit public. So I think we have a policy that worked, and worked well, in effect by conducting the audit, finding inadequacies, making them public, and then fixing them in the end.

Mr. John Bryden: But if I may say so, it was when she released those documents that we found much more. I found things in my own riding that I didn't know existed—that kind of thing. I'm not criticizing the department for that, or the auditors, but I'm suggesting to you that with this information/communications technology we have now, there is more opportunity to put government operations online so that senior managers can see what junior managers are doing, not to mention the public and MPs. I leave that thought with you.

Mr. Mel Cappe: If I may respond, government online is a major initiative of the government trying to move this forward. Mr. Bryden is raising the question about transparency and openness in government, and I think it was a justice of the Supreme Court of the United States who said the best disinfectant is sunlight. I think being open and transparent for those things for which it is desirable to be open and transparent is very positive. That is a guiding principle in government online and will be for this initiative as well.

Mr. John Bryden: Do I have any more time, Mr. Chairman?

The Chair: Half a minute.

Mr. John Bryden: I have another question on the first of your four points. You say “first and foremost is the protection of merit, non-partisanship, representativeness and competence”. Can you put them in order of priority?

• 1625

Mr. Mel Cappe: I'm not sure they are all that separate. They're very interrelated. If I had to capsulize it into one concept, it would be that it is the people who can do the job who should get the job. Earlier, in response to Ms. Jennings, I said we need to be clear about what we mean by merit or by competence, because there are many factors that go into it. I have trouble separating merit and non-partisanship.

Mr. John Bryden: That's fine. Thank you, Mr. Chair.

The Chair: Thank you, Mr. Bryden.

Mr. Cappe, Mr. Murphy mentioned that it's perhaps a systemic organizational problem that led us to these serious problems in the public service that are now being addressed in a renewal situation. I would expect that the whole notion is to try to get to a situation where we have good human resource management and good relations between employer and employee and so on.

When I look at the issue of the employment equity that was just settled a year or so ago for the bulk of the civil service... There are separate employers—and the Auditor General happens to be one of them—and the Auditor General's office, for example, wants to settle the employment equity and pay the staff the employment equity they feel they deserve. They are a separate employer, but now they're bound up in this court case and they can't pay.

Surely these types of things lead to a bad morale problem or a reduced morale problem in the public service. Can we get these things unjammed, unstuck?

Mr. Mel Cappe: I'm going to avoid editorial comment and point to the fact that this is the law. This isn't some discretionary administrative policy; it's the Canadian Human Rights Act.

The Chair: The Human Rights Act says you have to pay employment equity for these people who are under federal jurisdiction, and of course we made the payment to the vast majority of the core civil service, but the non-core civil service, these other employers, of which the Auditor General happens to be one, can't do this because of the court case going on to resolve whether we have to pay it for them as well.

Mr. Mel Cappe: I'm not going to speak for the Auditor General—she may well want to comment—but as I say, there's a law, there's a court case under the law, and the Auditor General can either choose to go ahead and pay or they can wait for the result. I'm sure you take legal advice just like I do. I don't have much else—

The Chair: Let me ask Mr. Quail. Mr. Quail, are you going to address this type of situation in your legislative review?

Mr. Ranald Quail: The main pieces of legislation we're talking about and looking at would be the Public Service Employment Act, the Public Service Staff Relations Act, and the Financial Administration Act, and, out out of those, any of the acts that could be affected by consequential amendment.

In terms of the scope of the review we're looking at, we are looking at it under section 1.1 of the Public Service Staff Relations Act, in that those are where the employees belong to the Treasury Board or the Treasury Board is the employer. I recognize that when I talk about amendments to the Public Service Staff Relations Act, where you have the separation between where you have separate employees, section 1.2, and section 1.1, which is where the Treasury Board is the employer... if you touch the act, you have to deal with the second part of the puzzle because you've touched the act.

The Chair: Is that a yes?

Mr. Ranald Quail: The scope of it is that at this time, going into it, Mr. Chairman, we're looking at section 1.1 of the Public Service Staff Relations Act, which is where the employer is the Treasury Board.

Mr. Mel Cappe: Could I add a precision about—

The Chair: All right. And then Ms. Fraser wants to say something.

Mr. Mel Cappe: The Minister of Justice had announced the Bilson task force looking at the review of section 11 of the CHRA, and that's, again, similar to my answer to Mr. Bryden on the ATI.

Ms. Sheila Fraser: Mr. Chair, as you well know, we've discussed this issue several times with the committee, but I'd like to make one point of clarification. That is, our office does not have the authority to pay any amounts of pay equity to our employees unless there is a court decision. We have to wait for this court case to go through in order to have the authority to pay any amounts to our employees.

• 1630

The Chair: So it's not a case of your doing so at your own risk; it's a case of your being directed not to pay.

Ms. Sheila Fraser: That's right.

The Chair: If I understood your point, Mr. Quail, you're looking strictly at the employees who have the Treasury Board as the employer, and you were quoting some technical paragraphs.

Perhaps you may want to think about the issue of inequities arising. We have an inequity here where Canadians perceive people who work for CCRA and people who work for the Auditor General's office to be civil servants, and technically they're not—and I agree that technically they're not. But when people are perceived to be all civil servants, and some get pay equity and some can't because of some technicality to be argued in a court, the perception is inequity, and morale suffers. So you may want to rethink whether you just restrict yourself to Treasury Board personnel only. You may want to broaden your scope.

That also brings me to your point where you mentioned that there are acts that you are reviewing, but you didn't mention the act that sets up the Public Service Commission. Am I correct?

Mr. Ranald Quail: The PSEA, the Public Service Commission—

The Chair: So you are looking at a review of the Public Service Commission.

Mr. Ranald Quail: Could I just come back to your request that we consider increasing the scope of the work of the task force?

The Chair: Your comment is...

Mr. Ranald Quail: That really concerns me. My earlier comment was that we have a timeline. If we look at why there were not many changes in 40 years, I would suggest it's because some of the people who worked on it tried very hard but found that the problem got bigger and bigger. As I go into this—and it's very early days—I am working hard with the people I have, to prevent “scope-creep”, if I can use that word.

The Chair: I can appreciate that.

Mr. Ranald Quail: I understand your comment on the perception. It can lead to a debate that we have class 1 citizens and class 1A citizens, who all work for the public service in the larger context. I understand that, but I would have to say that at this point I have a pretty clear focus on the technicality of section 1.1 where the employer is the Treasury Board.

The Chair: Then perhaps we have to look at task force 2, starting in June 2002.

Madame Jennings.

Ms. Marlene Jennings: I'm going to ask you a question that may be a little touchy. You may not want to answer it.

Under the public service act right now, in order to be eligible to apply for a position in the Canadian public service, the federal public service, preference is given to Canadian citizens. I have a problem with that.

Mr. Mel Cappe: Yes.

Ms. Marlene Jennings: My problem is that I think Canadian citizenship should have a value, and I find it difficult to understand why it's even open to someone who is not a Canadian citizen.

When I look at the whole issue, it might have been justifiable many decades ago, when citizenship could take seven years and longer, but at this point in time, where with three years of residency one is eligible for Canadian citizenship, I don't think that's a long time for someone to wait to be eligible. In practice, it's virtually only Canadian citizens who are in fact hired.

In my riding I get residents who come and say they applied for a competition that was open to the public and then were told, you're not a Canadian citizen, so there's really no point in you applying. They find that very deceiving. Why not simply state that you have to be a Canadian citizen? I'd like to know what other OECD country allows non-citizens to apply and the possibility of being hired into their public service.

Mr. Mel Cappe: I don't know the answer. I will certainly look into it and perhaps write to the chair and the committee with the answer to that.

But actually, I've also heard the criticism on the other side.

Ms. Marlene Jennings: Yes, I know. I've heard it too.

The Chair: What's the criticism on the other side?

Ms. Marlene Jennings: That it should be open to anybody and we shouldn't give preference to Canadian citizens.

• 1635

Mr. Mel Cappe: I'm not making the case, by the way.

The Chair: That's a statement, not an argument.

Mr. Mel Cappe: I'm not making the case.

Ms. Marlene Jennings: Well, I'm making the case.

Mr. Mel Cappe: Perhaps I could just mention that we're moving towards indicating to new Canadians at the time they are sworn in that they should think about the public service as a career, and handing out letters of invite.

Ms. Marlene Jennings: But I am making the case that the federal public service should be open to Canadian citizens—period. That is one of the ways that, first, we give value to our citizenship, we recognize the value of our citizenship, and it's also one of the ways that we encourage non-citizens who are permanent residents to think seriously about becoming Canadian citizens.

Mr. Mel Cappe: Yes.

Ms. Marlene Jennings: I've finished.

It wasn't too difficult was it, Mr. Cappe?

Mr. Mel Cappe: It was pleasant.

The Chair: Thank you very much. Personally, I certainly second your comments there.

Mr. Shepherd.

Mr. Alex Shepherd: When Mr. Serson was before us, the issue was the geographical hiring practices currently going on in the Public Service Commission. The way he answered that was, in a way, for a lot of us, the tip of the iceberg of what some of the real problems are. He seemed to be saying the problem was that he didn't have the technology to do that.

In other words, they'd been looking at software programs, and at the time I quoted IBM—I think it was a software program that he was looking at. How do you manage the public service, and how do you manage the number of applications in this particular case?

In a sense he's saying that from the time we brought this legislation in, back in 1992 or 1993, he's been unable to modernize the Public Service Commission, unable to get resources to buy this software, or lease it, or whatever you do. So as you're going through this process, I'm wondering what provisions are there for using and maximizing the use of technology. And do you have the resources to do that?

Mr. Mel Cappe: In a way, this comes back to the comments to Mr. Bryden's question about government online, because as we move towards putting all our services online, we should be putting a lot of our internal services online as well and using the technology effectively.

The issue of the geographic scope of competition, though, is partly determined by the nature of the law and the jurisprudence around the law, that if you have the ability to look for a capable person, if you have to look for the best qualified person and the only constraint you have is the geographic determination, then you tend to define it very narrowly; otherwise you'd be inundated with applications and would have to interview all these people. Whereas if you change the law and are able to change the nature of whether you're looking for the best qualified person or a person who's capable, you will be able to then enlarge the scope of the competition and actually include more people. I think that's the direction we would like to move in. So it's partly the technology and partly the jurisprudence that has led us to use the scope of competition as a way of managing just the volume.

I think he or the Secretary of the Treasury Board made reference to the volumes they had. It was probably a volume management issue.

Mr. Alex Shepherd: I just get the impression that the legislative position is his fallback position. In other words, he can justify its existence because the legislation tells him he can do that. I would think most of the people on the committee here came to the conclusion that it was not applicable in this day and age, with the technology, that they should be doing this.

Mr. Mel Cappe: We should be able to do interviews at long distance. We're doing it in other programs; we should do it for staffing.

Mr. Alex Shepherd: There has been a lot of talk recently among legislators and others about this whole idea of thinking horizontally, breaking down the silos in government. How is your agenda for change going to affect that, because of course, managers manage specific things in specific departments rather than the ability to go across departments?

That, of course, is where modern society seems to be going to some extent. So how are your changes going to empower that kind of movement within the public service?

• 1640

Mr. Mel Cappe: This is a very big question. I would merely note that there are a number of initiatives under way trying to force us to behave and perform more horizontally across the departments, and we're doing that administratively, not legislatively. In fact, going back about five years, I chaired a deputy minister task force, and we have an associate deputy minister group looking at this now. So there are a number of initiatives going on.

However, the legislation is relevant, in a sense. If we can make it easier for public servants to move through their careers in different departments and gain a corporate perspective on what the public interest is at large, rather than the public interest in their own little home, it will change the perspective of all of us, and I think we will be a stronger and more effective public service as a result. So I do think it's relevant, although it will be very indirect. I don't think we have a horizontality volée in the legislative reform, but if we can modernize and we can see careers that don't go simply up within a department, but actually move across and around the public service, we'll have people with a broader perspective, and I think that'll be good.

Mr. Alex Shepherd: So that is an administrative thing. How do you encourage that from an administrative point of view? How do you encourage people to go across departments? I presume everybody has to get into the universal classification system, but are they going to go back and forth using the classification system across departments?

Mr. Mel Cappe: Obviously, that's an element of it. But I think the more important element is the facility with which you can do staffing. If staffing is a process that takes, as the Auditor General points out in the report, so many months, then one tends to try to avoid it or one tends to add a premium to the people you work with. If you can unburden that process and make it more efficient, I think people will be prepared to take more risks, and you'll see more dynamism develop in the process. I think people will move around more, and again, it'll just strengthen the public service.

The Chair: Thank you, Mr. Shepherd.

We'll go to Mr. Cardin now.

[Translation]

Mr. Serge Cardin: Thank you, Mr. Chairman.

Following up on that question, at one time, people could spend their entire life working for the same employer; today, workers are expected to change jobs four or five times. Therefore, you're still a long way from resolving your problems, in my opinion. If you can't compensate for the change in jobs within the public service by offering opportunities for promotion within the organization, then the public service could be facing the same problem. Those who are hired by the government will change employers at some point in time. They will not move to other jobs public service jobs, but rather find employment outside government.

This problem came to light further to audits that were conducted and as I see it, we need to address the problem differently considering that every worker is likely to change employers four or five times throughout his or her working life.

Mr. Mel Cappe: I totally agree that the workers in today's economy are more mobile than ever before. We have a responsibility to adapt and to be open to these workers. I alluded to this trend in the annual report and observed the following on page 7:

We want young people to join for the experience. We hope many will stay for a career.

That may happen, but it's not our ultimate objective. I joined the government 25 years ago with the intention of staying one year. I became a career public servant because I enjoy the tremendous challenges associated with my job. I have worked with some very stimulating people. If we can manage to convince people to give the public service a try, perhaps we can convince them to stay for a career.

• 1645

Mr. Serge Cardin: However, not everyone can hold such a prestigious job as yours.

Mr. Mel Cappe: I started out at the bottom.

Mr. Serge Cardin: I understand, but there are many people working in the public service and not everyone can hold down an important position. Often, people want to improve their situation. You can't offer more attractive salaries or benefits than those offered by the private sector or the competition because taxpayers might voice their displeasure over the management of the public purse. Therefore, your room to maneuver is relatively limited.

Mr. Mel Cappe: That may be true, but we can offer something that the private sector cannot, namely an opportunity to serve the public interest and to help build this country. That's why we talk about recruitment, but about other things as well, namely well- being in the workplace. If we could improve the workplace, we might be able to attract more people. We are also focusing on training and development. The opportunity to learn on the job will help people choose a career in government. That's why earlier, in response to a question, I stressed the importance of establishing a public service training agency.

Mr. Serge Cardin: You've almost convinced me, but I'm too old.

Mr. Mel Cappe: I have a job for you, sir.

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

[English]

Mr. Bryden.

Mr. John Bryden: First, Mr. Chairman, I have a point of clarification for the record and for the witnesses. The 10,000 documents released by the minister disclosed in my riding problems that weren't uncovered by the audit and were only evident as a result of my being able to see what was happening in my riding. That was the point I was trying to make there.

My real question is, what are you doing, in the context of this renewal effort that you have under way, to maintain and even improve the standard of ethical behaviour in the civil service? That's part and parcel, surely, of what you're trying to do.

Mr. Mel Cappe: I absolutely agree. In fact, Mr. Serson didn't have the chance, I think, to raise one of his favourite files, which is that very issue of values and ethics in the public service. I asked Scott Serson, before he became chairman of the Public Service Commission, and Janice Cochrane, before she became the deputy minister of Public Works and Government Services, to be champions within the public service for values and ethics. In 1996 there was a document, A Strong Foundation, which was prepared by John Tait, who is deceased. As a former public servant, he led the creation of this initiative, which tried to articulate the values of public service. Scott Serson and Janice Cochrane have since taken up the mantle and tried to engage public servants across the country in a dialogue on values and ethics and ethical behaviour.

I think the public expects a higher standard from public servants than the private sector expects from their employees. The private sector doesn't agree with me when I say that, but I think it's true. Therefore, we are engaging public servants in this dialogue. CCMD runs a program of sessions on this with public servants. Many departments are actually using this as a focus for their work.

In fact, in Australia legislative reform in 1999 led to the creation of a merit act, which began with an enunciation of the values of the public service. The entire human resource management regime follows from, or flows from, that statement of values. So that is a model we're looking at. I won't tell you that's what ours will look like, but I would agree with Mr. Bryden's point that if you get the values right, the rest will flow from it. Mr. Serson, as chairman of the Public Service Commission, is talking in all his addresses to public servants across the country about values-based staffing. So it's exactly that point.

• 1650

Mr. John Bryden: This actually leads to Madam Jennings' point, because if you acquire Canadian citizenship, you make a commitment to Canadian values. What's the situation now? Can a non-Canadian serve in the public service?

Mr. Mel Cappe: I was afraid you were going to ask. Ms. Jennings has made that point, and I'm genuinely not sure.

Mr. John Bryden: You're not sure. Sorry, I missed that.

Ms. Marlene Jennings: Under the legislation precedence is given to Canadian citizens.

Mr. John Bryden: Let me just finish the point. I think Madam Jennings has made a very important point, because it would seem to me the last thing we want our civil service to become is an international corporation that hires talent wherever it can get it. I think the minimum we should expect is that if people want to be part of the civil service, either they should have citizenship or they should get it. That guarantees at least some adherence to who we are, what we believe in, and the very ethics you're talking about.

The Chair: Thank you, Mr. Bryden.

Mr. Cappe, you mentioned protection of merit. In fact it's in your annual report to the Prime Minister. We had the Strong commission that came out with at-risk pay—don't ask me why they called it at-risk pay; to me it was performance pay. I've got a report here, in fact I just got it this morning, from which it would appear that virtually everybody in the executive ranks qualifies and receives at-risk pay. Out of the 3,284 executives in the civil service, 3,136, 95%, are getting it. Is this just another way to give a pay rise? Why are 95% of the executives getting it?

Mr. Mel Cappe: Mr. Chairman, it's really important to go back to 1981 on this one, when what was then called performance pay was created by taking part of the base salary out of the salary and identifying it as performance pay. The at-risk pay that the Strong committee proposed was based on that previous regime. What they were saying was that the government should pay public servants for their performance, but that it should be at risk of their performance, so that if they don't perform, they don't get it.

So the degree to which an individual gets performance pay is determined by their performance. If someone succeeds in meeting their objectives, they will get performance pay, because it's part of the compensation regime. If they don't succeed, they will not get it. If they exceed the expectations of their supervisor—this is for those people who are eligible, largely the executives you were speaking of—they will get a larger amount. So we've taken out of the base some money that was part of compensation, put it at risk, so that if you don't perform you don't get it, and then varied the amount that one gets based on performance.

The Chair: I'll use a hypothetical percentage of 5% at-risk and 5% performance—it needn't be the right number. The salary is, for simple math, $100,000, and you say, “You're going to get paid $95,000, but if you do the job we pay you to do, you'll get the $100,000, i.e. the 5% more, and if you exceed that, you'll get $105,000.” Is that the way it works?

Mr. Mel Cappe: Conceptually, that's not far from the way it works. You determine the expectation of the job, and if somebody meets that expectation, they get... And that's why it isn't a bonus; it is compensation for doing the job. If you exceed the expectations of the job and you do a very good job, then it's conceivable that you would get that $5,000 addition to compensate you and provide an incentive.

• 1655

The Chair: I take a look at the numbers that said 95% of the people are getting it in the Public Service Commission. I was quite critical of them when they were here last. We see 45 executives, and 45 people are getting performance pay. In your own department, the Privy Council Office, out of 73 executives, 71 are receiving the performance payments. A total of 95% of the government overall is getting the performance pay, for a total of $19 million.

When Mr. Claydon was here the other day, he suggested or indicated that for the Strong commission, merit pay was a pilot project. They were examining it, and I'm encouraging that we have merit pay right throughout the while civil service. He said that may be something we could perhaps take a look at, although he was somewhat reluctant. But on the perception side, definitely, it now seems to be something that is becoming just part of salary. I would doubt 95% of executives would qualify. Am I wrong in that perception?

Mr. Mel Cappe: I think it's really important to distinguish between those people who exceed performance expectations and those people who meet performance expectations. If we were to wipe out the system of performance pay now, and we said we won't pay so-called bonuses, then we would have to take that money and put it back into the base of the salaries and give everybody the same amount. We would have given everybody about $103,000 or $101,000, instead of the $100,00, to use your example.

What this regime does is say that about 30%, more or less, will get that exceeded amount, and the base will get... The regular people who do a good job will get their at-risk pay. They will have earned their at-risk pay. Some of them will not have earned it, and they won't get it.

The Chair: We all know about Human Resources Development's billion-dollar boondoggle, if I may use that terminology.

Mr. John Bryden: Mr. Chair, on a point of order, I object. Oh, dear.

The Chair: Well, let's talk about the problems. There were serious problems at HRDC. Everybody acknowledges that.

The Auditor General went in and did an audit, and an internal audit said there were some serious problems. But out of 246 executives at HRDC, 226 were getting their performance pay, their at-risk pay. They were presumably doing a good job or a better job.

Mr. Mel Cappe: I'm not going to speak about any individuals or any individual cases, sir, but I will tell you that all of the people who were involved in grants and contributions programs, who reported to the deputy minister of HRDC directly, did not receive performance pay last year.

The Chair: Changing the subject to whistle-blowing, which has been somewhat in the debate—not of late, but over the... We would like to try to recognize that civil servants have an obligation to Canadians, but they also have an obligation to their employer. It's a bit of a conundrum that they should be allowed to blow the whistle, but, at the same time, we talk about ethics. If something is unethical, there has to be a procedure by which they can express that opinion and be heard.

I was recently privy to an in-house video presentation by a large multinational that had developed a serious, definitive policy for staff who believed there may be corruption and bribery by managers going on, and so on. The opportunities for whistle-blowing within the organization were there, and no one was going to be allowed to stay mute if they saw something going wrong in the organization. Are you contemplating developing anything along this line for the staff of the public service?

Mr. Mel Cappe: Mr. Chairman, if I could begin by drawing your attention to the first category of values and ethics that Mr. Tait referred to, he talked about democratic values, and they are fundamental to the public service. I would submit that in a Westminster parliamentary democracy, there is no way we would want to undermine the accountability of ministers in the House of Commons. Therefore, in having a strong foundation—if I can come back to that—of values and ethics based on democratic values and respecting the accountabilities of ministers, you want a system in which an officer, a person, an employee, who feels there is something amiss or something that has gone wrong, has the capacity within their department and within the government to be able to make known their concerns. In fact, in court cases that have recently been decided, that principle has been recognized: that there should be a venue within the department to take account—

• 1700

The Chair: Is there a definitive policy within the public service that, first, civil servants know of, and second, are in essence required to act under if they see something that's grossly unethical in terms of making sure it is reported to someone who has the authority to do something about it?

Mr. Mel Cappe: I would say it's something I know Treasury Broad Secretariat is looking at. I know it's something for which we have a policy, but there are some people who would allege it's inadequate.

The Chair: Does anybody else have any questions? No?

Mr. Quail, for the Public Service Commission, as you know, we're talking about the geographical restrictions that allowed them to hire people within a geographical part of Canada.

If I can quote you, Mr. Cappe, you said that whoever can do the job gets the job, but we wouldn't want to say that's provided they live in a certain part of Canada.

Again in your legislative review, Mr. Quail, can we be assured that it will be absolutely assured that any Canadian, anywhere in the country, is eligible to apply for a job? I'm not saying he has to be subsidized by the government to come to Ottawa for the interview, but does every Canadian have the right to apply for a job within the civil service if it's available?

Mr. Ranald Quail: If you're looking for an assurance that I've already made up my mind as to where we are on particular issues, Mr. Chairman—

The Chair: No, I'm not asking for your assurance in—

Mr. Ranald Quail: —I haven't done that.

The Chair: Well, you must agree that it's inequitable.

Mr. Ranald Quail: Let me come at it the other way. Mr. Serson has said they're having a look at that, and that they're looking at how they can solve that particular problem. I'm looking forward to their conclusions on how they look at it, and I did take into account the comments Mr. Shepherd made in that earlier discussion.

Do I think there should be fairness? The answer is yes. Do I think there should be efficiency? The answer is yes. Should there be effectiveness? The answer is yes. But as we start to try to balance all of those things and still make sure we get a person who is competent for the job, it will be quite a challenge for us to wrestle with as we go through looking at how we can draft the legislation. I'm going to start off on the principles base and come at it that way, Mr. Williams.

The Chair: Well, we appreciate that, Mr. Quail.

I was disappointed to find that the Public Service Commission did that. If I may paraphrase the Auditor General's report—Ms. Fraser, you can correct me if I'm wrong—I seem to think that for one particular position, there were 7,400 applications, of which about 800 or 900 were good applications. Of course, they filled the job with one person. They took the other 899 applications and threw them in the garbage, so the next time somebody came along, they had to start the whole process again. In terms of your concept about efficiency, they had identified 800 or 900 competent people, but they didn't bother to keep them on file.

We have e-mail today, we have websites, we have all kinds of electronic opportunities, at no cost, to let any Canadian know about a job anywhere in Canada. And while I agree with efficiency and all the other points you said, fairness and opportunity for all Canadians also have to be among of them.

Mr. Bryden, did you have a comment?

Mr. John Bryden: Actually, I'm following up on that in a quaint way.

The Chair: Which is why I defer to you.

Mr. John Bryden: Just recognizing that there are choices to be made in these issues—efficiency versus fairness, and all that kind of thing—can I look forward to the fact that representativeness will not be at the cost of competence in whatever legislation comes out? You see, just as in the case we're talking about here, the problem is that when you have these—

Ms. Marlene Jennings: Equity.

Mr. John Bryden: Well, yes, equity.

• 1705

Madam Jennings talked for some time about equity. Then, of course, there's always the question of whether you hold equity at a higher level than competence, or even a level equal to it. What's the lead?

Mr. Mel Cappe: Mr. Chairman, I would just point back to my answer about diversity. I think we get better outcomes when we have diverse inputs. From departments for which I have been the deputy minister, I have many examples of where we were providing service that was less than optimal as a result of the fact that we didn't have a diverse workforce to deliver the service.

When I was in Environment Canada, we were trying to sell weather products into the weekly ethnic newspapers. We kept sending a white person who was fluently bilingual in English and French to sell to the Chinese newspapers in the lower mainland of B.C. We were therefore incapable of selling. When we hired somebody who was Chinese, they were able to sell much better.

So a diverse workforce helps to improve the quality of the output, and merit can be a reflection of that diversity.

Mr. John Bryden: There's no doubt about that at all. I agree entirely, and I just hope we can look forward to you doing exactly that in the legislation.

Mr. Mel Cappe: Good.

Mr. John Bryden: It's a little bit like Solomon and the baby. You have to cut it in half.

The Chair: We'll let you explain that at a later date.

Madam Jennings.

Ms. Marlene Jennings: Do I get the last word?

The Chair: No, you get the next word.

Ms. Marlene Jennings: Other than yourself, Mr. Chair?

The Chair: Perhaps.

Some hon. members: Oh, oh!

Ms. Marlene Jennings: On the issue of diversity, I'd just like to make a point. The Employment Equity Act makes it clear that while diversity is something the public service has to be preoccupied with, nobody gets hired if they're not qualified for the job, regardless of their sex, the colour of their skin, or their disability. Am I correct, Mr. Cappe?

Mr. Mel Cappe: Well, I would say there is no conflict between the Public Service Employment Act and the Canadian Human Rights Act.

Ms. Marlene Jennings: That's not a yes or a no.

Some hon. members: Oh, oh!

Ms. Marlene Jennings: We don't have an affirmative action program like we saw in the United States—

Mr. Mel Cappe: That's right.

Ms. Marlene Jennings: —where specific quotas were established and where, whether or not the individual had the skills required for the job, people got hired if the numbers weren't met. Here, under the Employment Equity Act, the person has to have the skills that are required for the job—both the academic requirements and the professional requirements. Am I correct?

Mr. Mel Cappe: Yes.

Ms. Marlene Jennings: Thank you.

The Chair: Thank you, Ms. Jennings.

Mr. Mel Cappe: Mr. Chairman, can I just come back to this issue of regions?

The Chair: You may.

Mr. Mel Cappe: It's really important to note that roughly 70% of the jobs in the public service are not in Ottawa. They are out there in regions, in small communities across the country. When we talk about efficiency and we talk about fairness, it's important to recognize that somebody who is staffing the position of an officer in a local Human Resources Development Canada office has to be able to deal with their community, but everybody in the country should also have a chance to be considered for that job. We have to find a way of dealing with that efficiently and fairly.

The Chair: But Mr. Serson also pointed out in his report that 70% of post-secondary hires were for the capital region. These are people who are going to be the best and the brightest, the people who may be making a long-term career out of the public service.

Those people who go to university at, for example, the University of Alberta, the University of British Columbia, or wherever, may find themselves denied the right—and I think I have hired people out of Dalhousie University, a wonderful university down in Halifax—to apply for the job by virtue of the fact that they live in Halifax or Alberta, when the jobs are here in Ottawa and they want people with a public administration master's degree. I can think of one particular person who had a master's degree in public administration out of Dalhousie. By virtue of the fact that they lived there and were going to university, they would be denied the right to come to work in Ottawa. That seemed totally illogical to me, and grossly unfair at the same time.

Ms. Fraser.

Ms. Sheila Fraser: Mr. Chair, I'd just like to correct some impressions that we may have left in our chapter.

First of all, on the numbers you referred to earlier, they were on the post-secondary recruitment program as a whole. There were referrals of 6,400 people, and 800 received jobs. So it was not one competition; it was the whole program per se. The other issue is that the post-secondary recruitment program does recruit across Canada and not just in the national capital region.

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The Chair: So they're right across the board.

Ms. Sheila Fraser: That's right.

The Chair: Now, getting back to the Public Service Commission, they were set up as an agency of Parliament to provide non-partisanship as far as hiring, promotions, and so on within the public service. The amount of delegation by the Public Service Commission to deputy ministers, departments, and so on, seems to mean they have largely worked themselves out of a job. How can we maintain the independence of the Public Service Commission if they've pretty well delegated everything to the departments?

Mr. Mel Cappe: Mr. Chairman, I read your questioning of Mr. Serson. I'd like to bring a precision to the notion of what the agency is.

The Chair: My question was vague?

Mr. Mel Cappe: No, sir, au contraire. I'm suggesting that there are some subtleties that I want to make sure are on the record, which I know you're aware of.

I want to make a distinction between the executive agencies of government and the parliamentary agencies. The Public Service Commission is actually a part of the executive of government. It is independent of government, and the appointment of the commissioners is for a fixed term rather than at pleasure. But, unlike the Auditor General, they are not an agent of Parliament as such. They're an independent agency that is part of the executive. That's a precision that's worth noting. They have regulatory functions, quasi-judicial functions, and administrative functions.

The answer to your question, though, is that... I think it comes back to the answer to Ms. Jennings' earlier question of who should do the hiring. Insofar as there are administrative functions that they're carrying out where an independent body is not necessary to carry them out, but an independent body may be necessary to supervise it, you could imagine managers carrying out the recruitment or the hiring process and being held to account by the arm's-length body.

So I don't think the delegations are a bad thing. In fact, again, to go back to the Glassco commission and all of the studies since, including the Auditor General's reports, there is always a consistency that says you should... Mr. Shepherd referred to Glassco, which was summarized as “let the managers manage”. The Lambert commission was summarized as saying “make the managers manage”. I would summarize the Auditor General's report as “for God's sake, get on with it and manage”. So I think there is this notion that delegation is a good thing if it's accompanied by the accountability and oversight you would have from a third party like the commission.

The Chair: That's an excellent point. Delegation with supervision is not a bad thing, but we found that the Public Service Commission did not know the needs of the departments. They didn't know who was being hired.

Madam Jennings raised an excellent point about the need to ensure representativeness, visible minorities, and so on, and the Public Service Commission seemed to be totally unaware of what was even going on in departments, or what even the needs of the departments were. They didn't seem to have grasped the issue of, “we are the people to ensure that representativeness—geographical, visible minorities, gender, everything else—is taken care of”. They seem to have... maybe it's more abdication than delegation.

Mr. Mel Cappe: Well, let me jump to the defence of the Public Service Commission, and let me sound defensive for a minute. I think that while they may not be as sensitive as they could be to departmental needs—and nobody understands the needs of the department as much as the people who are trying to deliver the service in the department—the commission has been sensitive to the need for dealing with employment equity, for instance.

They ran a job fair in Ottawa, in the national capital region, where they expected about 1,000 people, and it was worked out with the ethnocultural communities in the area. They had over 6,000 people attending, and it went for about nine hours instead of the six they had planned, getting CVs—and it comes back to the point you were making earlier—and developing an inventory of competent people who also happened to be employment equity target groups.

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So they were sensitive to those needs, and they're trying. I think in the end, though, some of the staffing programs are worked out with departments that have specific needs—I'm thinking here of the Department of Transport, for instance, that needs air transport inspectors—where they've developed a particular program and delegated to the department the capacity to go out and hire. That's been an example of one that's worked relatively well.

So there are some successes. Is it good enough? We can always do better, sir.

The Chair: On that note, we will have the closing comments from Ms. Fraser.

Ms. Sheila Fraser: Thank you, Mr. Chair.

I think we all recognize that an efficient and effective public service is critical to the well-being of Canadians. I think everyone recognizes, too, that there have been several longstanding issues and concerns that, as Mr. Cappe has mentioned, have been around for probably 30 or more years.

We welcome this initiative. We believe it is very important. We will follow its progress closely. We believe it's important that the committee also stay informed of its progress.

The Chair: Thank you, Ms. Fraser.

Thank you, Mr. Cappe, Mr. Quail, Madam Barrados, Ms. Elliott.

The meeting is adjourned to the call of the chair.

OPENING REMARKS

MR. MEL CAPPE

CLERK OF THE PRIVY COUNCIL AND SECRETARY TO THE CABINET

STANDING COMMITTEE ON PUBLIC ACCOUNTS

May 17, 2001

Introduction

—Thank you, Mr. Chair, for inviting me. I am pleased to be here with Mr. Ranald Quail, the Deputy Minister leading the Task Force on Modernizing Human Resources Management in the Public Service.

—I would like to begin by saying that high quality service delivery to Canadians and sound, professional advice to Ministers requires a strong, non-partisan, representative, bilingual and national Public Service.

—The Government recognized this in the January 2001 Speech from the Throne, and I quote:

“To assist the Government in fulfilling its responsibilities, Canada must have a public service distinguished by excellence and equipped with the skills for a knowledge economy and society.”

—One of the main recommendations of the Auditor General's report - Chapter 9, of April 2000 is that the government modernize the legislation governing human resources management in the Public Service and that we clarify roles and responsibilities.

—The Government has come to the same conclusion and is taking action. We are moving from incremental change to a more fundamental change of the system. We must build for the future - the current system is 35-years old.

—The Prime Minister believes change is needed, and has designated the President of the Treasury Board, the Honourable Lucienne Robillard, as the Minister responsible and naming Ranald Quail to lead the Task Force.

—In recent media interviews, the Honourable Lucienne Robillard has indicated that she will be bringing forward legislative proposals in this regard within 18 months.

—As the Prime Minister said in the House of Commons, he is proud of the Public Service. In fact, our appearance today underscores the Government's commitment to build a modern people-centred public service. Canadians, as well as the dedicated and talented people who define this institution, deserve no less.

Roles and Responsibilities

—Before I talk more about what we are doing to modernize human resources management, I want to speak briefly about the roles and responsibilities of the major players involved in the management of human resources in the Public Service and where I fit in the picture.

—The Treasury Board is the employer for the core public service. In this regard, it is responsible for labour management relations, collective bargaining, administrative policy and personnel management. And the Treasury Board Secretariat supports Ministers in exercising these responsibilities.

—The Public Service Commission is responsible for all appointments to the Public Service, the protection of merit, review and recourse of staffing processes and delivery of some training programs.

—The Canadian Centre for Management Development, among other things, provides high quality learning programs for senior managers across the public service.

—And most importantly, Deputy Ministers are responsible for the management of human resources in their departments. The Public Service Commission has delegated most of its authority to recruit and staff within their individual departments to Deputy Ministers.

—And Deputy Ministers increasingly play an important corporate role as well. We now have Deputy Minister champions on such important horizontal responsibilities such as values and ethics, the human resources community and the science and technology community.

—I, myself, have three official roles. I am Clerk of the Privy Council; Secretary to the Cabinet; and Head of the Public Service.

—As Head of the Public Service, I recently submitted my 8th Annual Report to the Prime Minister. It was tabled in the House on March 30, 2001 and I have copies with me today for your information.

—For the Public Service, modernizing means ensuring a modern people-centred organization, distinguished by excellence and innovation. We must position ourselves to respond to the significant challenges facing Canada and the public service: technology, the new economy, and changing demographics.

—Within this context, I'd like to focus today on what we have done, are doing and plan to do to modernize human resources management in the Public Service of Canada.

What have we done?

—The past decade will be remembered as a period of great change in the public sector.

—In the mid-1990s, the Government of Canada committed to eliminate the deficit and the Public Service of Canada made important contributions.

—In 1997, we launched La Relève, a series of initiatives across the Public Service - making good human resources management part of good government.

—To make this important cultural shift, we involved public servants at all levels, in all departments and central agencies and all regions.

—And we are seeing positive results.

—At the outset of my tenure as Clerk, I created three committees of Deputy Ministers on recruitment, workplace well-being and learning and development.

—Recommendations were developed and action is being taken both by central agencies and by departments to recruit, retain and develop a skilled workforce.

—I personally led the recruitment committee because one of my most significant responsibilities as Head of the Public Service is to ensure the future Public Service will be in a position to serve future governments.

What are we doing now?

—In my recent Annual Report I described how we are becoming a modern, people-centred institution which gets results that matter to Canadians in an economy and society based on knowledge.

—And in the January 2001, Speech from the Throne, the Prime Minister committed to the reforms necessary to enable the Public Service: “...to attract and develop the talent needed to serve Canadians in the 21st century.”

—Flowing from this commitment:

-The Prime Minister announced the creation of the Task Force on Modernizing Human Resources Management in the Public Service in early April;

-We have continued and reinforced our efforts to modernize service delivery and strengthen policy capacity; and

-The Public Service has continued to make a priority of recruitment, workplace well-being and learning and development.

—At the same time, we are examining the longer-term implications of the broader transformation to E-Government which also requires us to take a hard look at how we manage people in a knowledge economy and society in order to encourage excellence.

Where are we going?

—Many commentators over the years, including the Auditor General, have spoken of the need for fundamental reform of the legislative and institutional framework.

—We need to modernize the federal human resources management framework: the current laws do not allow us to move quickly enough - not in a world where we are competing for talent.

-There is a need for clarity in roles of the players on human resources management;

-There is a need to improve the efficiency of the system and ensure fairness in the treatment of employees; and

Managers must have a greater responsibility for human resources management.

—There is also a need to make improvements to labour management relations in the Public Service and there is already a process underway. Mr. John Fryer is currently chairing an advisory committee on labour-management relations in the Public Service and is expected to make recommendations to the Secretary of the Treasury Board, some of which may entail legislative chan And I cannot emphasize enough that we are committed to Public Service values, including particularly those of merit, non-partisanship and fairness.

The Work of the Task Force

—Mr. Ranald Quail, the former Deputy Minister of Public Works and Government Services Canada, who is here with me today, is leading a team to make concrete recommendations.

—The work of the Task Force will be guided by the four principles I outlined in my 8th Annual Report to the Prime Minister:

-first and foremost is the protection of merit, non-partisanship, representativeness and competence;

-second, management should be responsible for all aspects of human resources management;

-third, authority for human resources management should be pushed as far down in the organization as possible; and

-fourth, managers should be held accountable for the exercise of their responsibilities.

—As the Task Force makes recommendations on how to best put these principles into action, it will engage in a dialogue with interested parties.

—We are also creating an external advisory group of representatives from the private sector, academia, and labour to provide professional advice on the recommendations of the Task Force.

—The Honourable Lucienne Robillard is very determined to see fundamental change happen - and to make sure that it happens as quickly as she can help make it happen.

—For example, the Government has already acted. To reduce the number of players in the human resources management system, the Government decided to transfer the functions of The Leadership Network to the Treasury Board Secretariat.

Conclusion

—Our workplan is ambitious and Minister Robillard is committed to seeing legislation debated by the members of the House of Commons in the fall of 2002.

-No question, that's a fast- track timetable.

-And we plan to meet it.

—And while the Task Force is working hard to come up with concrete recommendations, we will continue to make improvements in how we retain, recruit and develop our employees.

—Which brings me back to why this is so important.

—In the old economy, securing scarce financial capital was key. In the new economy knowledge and talent are the scarce commodities that we are seeking.

—Encouraging innovation will make a difference for Canada's place in a fiercely competitive global economy

—By starting with the fundamentals - the legislative and institutional framework - we not only reinforce the changes we have made thus far but signal the importance and urgency of change through-out the Public Service.

—So, in conclusion Mr. Chair, the Auditor General and others have spoken. We have listened. We are also here to listen today to the concerns you and committee members may have.

—Mr. Chair, a strong and vibrant Public Service is of interest to all Canadians. It is at the heart of our system of government and our quality of life.

—I am confident we are taking the actions we need to ensure the Public Service of Canada can continue to provide quality non-partisan advice to Ministers and to serve Canadians and Canada well in the new economy.

—Thank you.