[Recorded by Electronic Apparatus]
Tuesday, December 10, 1996
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[English]
The Chairman: I call this meeting to order.
Pursuant to Standing Order 108(2), the committee resumes its examination of the public service renewal initiatives.
We are pleased to welcome back Mr. Peter Harder, secretary of the Treasury Board, and his colleagues, Mr. Jean-Claude Bouchard, chief human resources officer, and Ms Theresa McKeown, special adviser.
We're arriving at the end of our current series of hearings on public service renewal initiatives. The hearings have served to inform us about the various initiatives Treasury Board has undertaken - they started back in 1990 - to revitalize the Public Service of Canada and to make the delivery of services more efficient across the country.
Our purpose in calling back the Treasury Board secretary is to help us focus on some of these initiatives, and more specifically, to ascertain how they'll be implemented.
Before we go to your opening statement, Mr. Harder, on behalf of the committee I'd like to thank you for the written responses to the questions put to you. We received them last week, I believe. So we'd like to thank you for that.
Mr. Peter Harder (Secretary of the Treasury Board of Canada): Thank you, Mr. Chairman. I'm pleased to be here again.
I know that my minister and a number of officials from the secretariat have spoken to you on the various aspects of public service reform.
[Translation]
Mr. Bellemare, I'd like to acknowledge your continuing interest in the Public Service. I know that Mr. Massé, the president, will respond shortly to the questions you raised in your letter.
I would like today to highlight four of the key roles of Treasury Board in the Public Service reform: firstly, alternative service delivery; secondly, modern comptrollership; thirdly, quality service to the public; and fourthly, transformation of the Public Service.
[English]
In developing our strategies for renewing the public service, the basic premise is getting government right through clarifying roles and responsibilities, structures and relationships with the federal public sector to better meet Canadians' needs.
What do I mean? Let me take alternative service delivery, which I will define for you because there is some misperception that alternate service delivery is simply a ploy to contract out services at lower wages.
Alternative service delivery, as we would define it, describes a range of organizational forms government can use to improve service to the public. For example, it can mean a partnership with provinces in terms of human resources development and manpower and the like, or it can mean the creation of a not-for-profit corporation in the public sector like NAVCAN, or it can mean the commercialization of services with appropriate protection for employees, as is being done with Canada Communication Group. It can mean the bringing together of authorities from several different departments to deliver a service, as in the Food Inspection Agency.
The second issue I'd like to highlight for possible questioning is modern comptrollership. Two weeks ago I named a new deputy comptroller general, Colin Potts, a partner in Deloitte & Touche, who comes to the public service on the interchange program. Colin has taken responsibility for leading the initiative to modernize comptrollership in the Government of Canada. He will be assisted by senior financial officers across Canada in the government and a blue ribbon panel of experts drawn from the private sector, led by Jean-Pierre Boisclair, the head of the Canadian Comprehensive Auditing Foundation.
The vision of modern comptrollership focuses on outcomes and results, rather than on processes and paperwork. It also includes maintaining sound financial management and controls. For example, in the area of contract management, our objective remains to get the best value for taxpayers' dollars through the competitive process.
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I would like to say a word about quality of service to Canadians. At the end of the day, the quality of service that we provide to the Canadian public is how Canadians measure the performance of their government. Treasury Board's role is to provide leadership and the implementation framework for individual departments. Much of the innovation in quality services is happening where it should be, at the very front lines of service delivery in departments.
Let me give you some examples. Human Resources Development Canada has put in place a system of over 6,000 kiosks over the last number of months to help Canadians process employment insurance applications, and to find jobs through the job bank. HRDC now has more kiosks in place across the country then the Royal Bank has ATMs. I understand from the department yesterday that 95% of employment insurance applications are taken through these kiosks.
Revenue Canada enables Canadians to file their tax returns electronically, and directly deposits refunds into their bank accounts. Revenue Canada has also created an express lane system for those who must cross our borders on a regular basis to do their business. This system alone has benefited the Canadian industry significantly.
At Citizenship and Immigration Canada, where I spent some of the last few years, we redesigned the processing system for citizenship and immigration applications to reduce delays.
The Auditor General has acknowledged that Canada is one of the leaders in improving service delivery, but improving delivery is a constant effort. We must never say that things are absolutely perfect. We must learn from the way we are doing things to seek to improve them on a day-to-day basis. One of the ways we do that is to use technology, and to use technology as a lever to re-engineer work processes.
As you know, Treasury Board has responsibility for setting information technology policy, and establishing the IT framework for government. Early in the new year I hope to be able to announce the appointment of the chief information officer for the Government of Canada, who will act as a strategic overseer of IT. In the meantime, last May the Treasury Board Secretariat published the enhanced framework for management of information technology projects, which goes a long way toward establishing, in precise detail, the policy and management framework for IT management.
As the employer for the public service, Treasury Board recognizes that the key to change rests with our staff, the Public Service of Canada. We have begun a new round of collective bargaining for the first time in six years. We have reinstituted annual pay increments, and simplifying the classification system is an objective, as is occupational group structure simplification.
As we transform systems and the public service, we will not lose sight of the core values and ethics that come to the heart and are a cornerstone that motivates people within the public service, and meets the expectations of Canadians, which they rightfully deserve to have met by the Public Service of Canada.
With that opening comment I'd be happy to take questions on the subjects I've raised, or on any other.
The Chairman: Mr. Gilmour.
Mr. Gilmour (Comox - Alberni): Thank you, Mr. Chairman.
Last week we had the professional group before this committee. Is it Treasury Board that negotiates with the professional group?
Mr. Harder: Yes.
Mr. Gilmour: The concern they had.... The committee was somewhat critical about the process, because you arrive at the negotiating table and the negotiating table is a confrontational approach. Is there any move to get away from the confrontational approach, of saying we know we're going to get downsized, that's a fact of life, this is where we want to be at the end of the day, and bring them on board there? Or are you stuck in this negotiating?
I've spent my other life at the negotiating table, and I understand the head-knocking that goes on. In many ways that doesn't get the answer that both parties want. What are you doing to approach it so that the resolution can be more easily arrived at by both sides?
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Mr. Harder: Thanks for the question.
We are resuming collective bargaining after six years, and in resuming it we were determined not to go back to the old way of collective bargaining, which tended to not have all of the relevant issues on the table, and that had a fractured number of bargaining tables.
We have negotiated with the unions the process of negotiation to simplify the number of tables at which the discussions will take place, and those negotiations were successful. We have indicated that we will be approaching this round with a total compensation approach, so there will be more levers available to both sides in the context of today's reality, which of course is one of significant reduction of public service staffing, and one which is increasingly focused on simplified systems and a more agile public service.
So far the discussions on both sides have indicated a desire to make this round of collective bargaining work, by actually reaching an agreement and doing this within a timeframe that signals that collective bargaining does work in the public sector.
I met as recently as yesterday with Steve Hindle, the president of the Professonal Institute of the Public Service, and with Mr. Jean-Claude Bouchard, to review with him the state of the relationship. We want to make sure we're getting our signals right and that as we begin this process, which will take place over the coming year, we do so within a realistic framework of expectation. I think the public service, because of the real commitments they've made over the last number of years through the pay freezes, through delivering on program review reductions and managing them appropriately, and continuing to focus on service delivery, has a pretty realistic understanding of the government's position.
Mr. Gilmour: Thank you.
As you downsize, the people who leave are those either taking early retirement or buy-outs. You're losing your experienced people, and if you're not hiring at the bottom end because you want to get to a lower number, how are you dealing with the issue of getting younger, more qualified professional people in there, when there aren't a lot of avenues to get in, in the first place?
Mr. Harder: You pose a very significant dilemma. We are asking the Canadian public, through Parliament, to contribute to very significant downsizing costs - the ERI and EDI initiatives. Yet we would have to acknowledge that if we looked at the demographics of the public service over the next ten years or so, we will have an aging workforce. So the demographics reflect your comment that there aren't a lot of youth in that profile, yet at the same time we have the need for some modern skills.
What we are seeking is to have some targeted recruitment in certain areas. I'm thinking of the economists program, for example, which brings young economists into the government in a very targeted way. We have some recruitment to do in the computer IT area in a targeted way. We need to do this in a way that doesn't offend the overall principles and constraints of downsizing, but does look at the long-term interests of the public service. That's what we're trying to balance in this period, and I would be the first to acknowledge that it's a tricky balance.
It's nice to go to meetings of young people in the foreign service. They're as committed as those of us were who joined at a younger age, but they're not as numerous and they are often more innovative in their thinking. They're less stove-piped and jurisdictional, and that's a refreshing impetus for their senior colleagues to look at problems in fresh ways, or service delivery, perhaps using technology more innovatively.
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Mr. Gilmour: When you're dealing with alternative services, are there standards or guidelines? How far does Treasury Board go to establishing whether it will be in-house or contracted out? Clearly they don't care for contracting out from the organized inside, because they see it as jobs going out the window.
I guess my question is does the Treasury Board have a neutral approach?
Mr. Harder: Our position on alternate service delivery is as follows. Departments should look, in the context of their business plans - their identification of their lines of business - at what is the most appropriate and most efficient way to deliver these services or this program.
What we are seeking to do in the alternate service delivery responsibility we have is to provide a broader range of models that they could use, but we don't go out there and say we think they should look at an alternate service delivery in this area or that a good department is one that has five and a better department is one that has seven. That's not it at all.
We want departments to look closely at what will better provide services to Canadians. In doing that, let's give them more flexibilities to look outside traditional structures and say maybe this makes sense.
It's interesting that for 25 years parliamentarians and public servants have debated food inspection. We always got hung up on departmental structures, because there are three departments involved, so who would have it?
The creation of an alternate delivery organization leaves the accountability issues in play but allows for the public servants to come together in this new organization to become a regime that can have its own tailor-made human resource and financial flexibilities and at the end of the day serve Canadians, in terms of food inspection, more effectively.
So we at the board are encouraging departments to focus on their clients and improve the delivery of their services. If they need a broader set of organizational structures to deliver those services, we're here to help identify what the shape of those could be, what the flexibilities could be and what the arrangements of moving workers from departmental structures to these alternate delivery structures could be.
But it is for ministers and departments to determine. Treasury Board is there to provide the leadership, to provide the framework and in a sense to provide the challenge to departments to look at their service delivery structures.
Mr. Gilmour: Thank you.
The Chairman: Mr. Harvard.
Mr. Harvard (Winnipeg St. James): The first round is ten minutes, right?
The Chairman: Yes.
Mr. Harvard: I don't think I need ten minutes.
The Chairman: Do you want to split your time with Mr. Bellemare?
Mr. Harvard: Well, I'll give the first round to Mr. Bellemare, if he's ready.
The Chairman: We didn't have him on the list.
Mr. Harvard: Let him go first.
Mr. Bellemare (Carleton - Gloucester): I purposely gave the clerk my name before my colleague walked into the room.
The Chairman: He didn't put you down, but the clock's ticking, and you have a chance to make your intervention, so I'd do it.
Mr. Bellemare: I just want to make sure that if he's here next time -
The Chairman: Well, he is filling in for Mr. Knowles.
Mr. Bellemare: Is he?
The Chairman: Yes, Mr. Bellemare.
Mr. Bellemare: Mr. Harder, welcome to the government operations committee.
I appreciate the openness with which you speak of Treasury Board activities and les grandes lignes of what you plan to do.
As you're aware, one of my big interests is public service. I'm not only saddened by what I've seen in the last few years, something that started with the Conservative government with Bill C-26 and their ``Let's renew the public service'' and other fine words being thrown around, probably written by academics.
I'm worried that we're developing a twin public service. The real public service is the one we've known for a long while. It has a corporate mind, a corporate culture, a corporate memory. We are very quickly developing a huge, huge private sector public service - that's the twin - that's out on contract. That twin public service would be oriented more to tasks than objectives, I would say.
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Really, that should be your bailiwick. You should guard that with a shotgun - the objectives, the principles of the operations of the government. That shouldn't be left to someone who just wants to make a living off contracts for us. It should be someone who believes in providing government services in the best way possible.
Now you may quickly add ``Yes, but there are some activities that can be done by the private sector.'' I would say perhaps these are tasks more than anything else, because l'âme, the feeling, la conscience are not there.
What I've seen so far is that you don't have a big stick. You write a lot - nice things, you know, and I'll be questioning you later on these points. Today I will have ample opportunity to do this, since the chair is busy somewhere else. I will be taking the chair and probably abusing my power as chairman by asking more questions.
I want to stick with the basic principles. Which of the two do you believe in - a public service that works for the Government of Canada to provide the best of services to Canadian communities and individuals, or do you believe it should be twinned, with a public service that is on contract and providing limited services with an eye to profit-making and time constraints?
Mr. Harder: I don't quite see the question the way you posed it, but I will answer it.
Mr. Bellemare: It's normal. I'm a politician and you're the public servant.
Mr. Harder: The Public Service of Canada has deep values and responsibilities that are by its very definition the public interest, and to serve the government of the day, and to provide services to Canadians.
The departmental structures in which the public service work -
Mr. Bellemare: Wait a minute. To serve the government of the day, or just government?
Mr. Harder: Well, in terms of policy development we serve government, and we're accountable to ministers, and ministers are the.... The public service is a professional, non-partisan public service, and we are -
Mr. Bellemare: But isn't that a contradiction of what you just said? If you say ``the government of the day'', then you become partisan.
Mr. Harder: No - we serve government.
Mr. Bellemare: Good. So you should drop ``of the day''. To serve government - whichever government.
Mr. Harder: Absolutely. I'm trying to emphasize your point, in fact, in that departmental structures are the traditional structures for public service, and they are involved both in advice-making on the regulatory side, and in service delivery.
In focusing on their work, individual departments have made decisions with respect to personal service contracting, in terms of assistance that they need for various projects, or the like. Those are made to meet the needs of a particular moment in time or a particular direction of a department.
Mr. Bellemare: A particular moment in time? In other words, you mean that it is a limited amount of time.
Mr. Harder: Yes, they could be for a short-term or specific projects. I'm just trying to -
Mr. Bellemare: What's the short term, in your mind?
Mr. Harder: Well, they could be anywhere from a few weeks to a few months. I'm just trying to -
Mr. Bellemare: A few months being what? Maximum.
Mr. Harder: Well, you know, what's a few months -
The Chairman: Mr. Bellemare, I'd suggest you give the witness an opportunity to answer, because -
Mr. Bellemare: I am.
The Chairman: - your five minutes are up.
Mr. Bellemare: Ten minutes. I need -
The Chairman: You're splitting the first round with -
Mr. Bellemare: No, I'm not splitting anything with anyone.
Some hon. members: Oh, oh!
The Chairman: No, no. Mr. Bellemare, you've got five minutes.
Mr. Bellemare: No, I've got ten minutes. Read the new rule book. The rule book says the first speaker of the Liberal Party, just as the first speaker of the - excuse me, I nearly said NDP - the Bloc and the Reform, is ten minutes.
The Chairman: Mr. Bellemare, let me enlighten you for a second, all right? Mr. Harvard was the first member on this side of the table to be on the list to speak for ten minutes.
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Mr. Bellemare: That was a mistake.
The Chairman: He graciously allowed you to speak for five minutes first. So your five minutes are up.
I'd ask you to just complete your answer. Then we'll go to Mr. Harvard, and then come back around the table. Thank you.
Mr. Harvard: I'm more than happy to give him the last five, though. I can take the second round, if you don't mind.
The Chairman: You're going to give him the rest of your time?
Mr. Harvard: Yes, and I'll take the second round.
The Chairman: You're back on for the rest of your five.
Mr. Bellemare: Perhaps we could go back to the point before we were interrupted. How long is a period of term that could be maximum?
Mr. Harder: It would be the term for which it would be inappropriate or not cost-effective to hire a permanent public servant for the task.
Mr. Bellemare: That's very interesting. I will, later on when he's gone, ask you questions on very different points.
The Chairman: Perhaps I won't leave. You're encouraging me to stay.
Mr. Harder: Can I just...? There are various categories of contact employees. Some would say that lawyers that government uses as agents are contract employees, and in certain respects they are. What we use when we use research and development -
Mr. Bellemare: I don't want to be rude here, but do you know what M and Os are - management and operation budgets?
A voice: O and M.
Mr. Harder: O and M, yes.
Mr. Bellemare: O and M - good. You're aware of it in the other departments, and you probably have that in your own department.
Are you aware that there could be abuse in every single department of the O and M budgets in hiring term employees on a rotation basis, constantly? For example, someone for six months keeps on coming back, and coming back, and coming back for another six months, and may be there for a year or two years.
I don't mind if you -
Mr. Harder: I'm having difficulty trying to answer you, because I get diverted to.... I'm quite prepared to have some time with questions.
Mr. Bellemare: It's that we're both focused on our own questions - me on my questions, and you on your answers.
Mr. Harder: Yes, and now I'm trying to get my answer out, which is to suggest that there is a wide range of contract opportunities that are selected by departments for contract purposes.
There is another cut at the question you have raised, and that is when larger units of activity are moved outside of departmental structures, as in the case of NAVCAN, to a not-for-profit area - which I would not say is contracting out, but moving a fair segment of workers to another organizational structure - and there are privatizations that take place, have taken place historically. That too is moving people out of departmental structures.
It is true that we do have a traditional public service in departmental structures, and have for many years - really since the beginning of this century, when we in Canada pioneered the crown corporation - had structures outside of departments that some were saying were twin public services.
Mr. Bellemare: May I go down to specifics? You do make a good presentation. However, contracting out is for specific jobs, for a specific time period. In a downsizing, we have been letting employees go. The perception is that a lot of them are very happy because they've had the ERI or the EDI. Some, though, have been designated, and are waiting for the other shoe to fall. There's that sword of Damocles over them. I've been meeting some of them, and they tell me that in their offices there are temps - temporary people - who have been there for six months, and another six months, and so on. They've been asking to be transferred to these jobs. Unless the workforce adjustment program is shot - is it gone? - shouldn't these professional public servants be the ones getting these temporary jobs when they're told that their particular job is designated and they are competent to go into that job?
Mr. Harder: Let me have a kick at this, and then I'll ask Mr. Bouchard to see whether he can answer it better than I, and then you can judge.
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The principle of the downsizing is that we want to reduce the number of part-time workers as well as the term employees. And if you look at the number of terms - I don't have the figures with me, but maybe Jean-Claude does - the number of term employees has gone down.
Mr. Bellemare: I know that.
Mr. Harder: Why do you want to reduce them?
Mr. Bellemare: I thought it was to reduce the number of indeterminate, the permanent employees, to downsize.
Mr. Harder: Yes, but you also want to -
Mr. Bellemare: They're the ones who all went away with the ERIs and the EDIs.
Mr. Harder: Yes, but you would be the first to argue that you want to have as low a number of term employees as possible. So you are, in this sense, as best as you can, protecting the term employees.
Mr. Bellemare: Then why are you in some departments permitting these term employees to be re-employed constantly at the expense of people who have been designated in a job? You know what I mean by designation, obviously.
The Chairman: That will be your last question.
Mr. Bellemare: For this round?
The Chairman: For this round, yes.
Mr. Jean-Claude Bouchard (Chief Human Resources Officer, Treasury Board Secretariat): If I may, Mr. Bellemare, during the period, for example, of March 1995 to 1996, a year, there were approximately 18,000 people who left the public service, and about 5,000 of them were term employees. So it's not only the indeterminate employees who have left.
Secondly, in program review what is targeted is not individual employees, but it's functions, jobs that are eliminated through this rationalization and then employees are identified, because their jobs are going. So there's a net reduction in the number of term employees during that period of time, and also, at the same time, there are not more than seven employees out of 18,000 who ended up leaving the public service without a cash-out and without another offer of a job.
There are employees who said ``I'm going to stay, I don't want a cash-out, I want another job.'' Obviously, if after six months they didn't find a job, then they're sent home without a cash-out. There are only seven of them.
I would offer that this is a major downsizing, one we've never seen in the public service so far, and at the end of the day there are only seven persons who ended up at home without a salary. There's still a need for term employees. Revenue Canada, for example, still requires a massive number of term employees for specific periods of time to deal with the income tax returns, and they often rehire the same people every year.
So government operations call for some term employment to deal with peaks in workload. There are people who are renewed on a regular basis for periods of time, but I would say that at the same time there are very few indeterminate employees who end up without a job. I have other figures I could quote on that.
The Chairman: Mr. Gilmour.
Mr. Gilmour: The crux is the bottom line. We can talk about numbers of employees and you can downsize in the public service, but if you're just taking your overlap and going to alternative service, how has the bottom line changed over say the last three years?
Mr. Harder: The bottom line is in fact the way program review has been managed. That is to say, as a result of program review one, there were $9 billion of program reductions, and program review two brings it to $11 billion of program reductions.
We did not, in program review, have a number of public servants we were seeking to reduce. That number was a consequence of the program decisions, as Mr. Bouchard indicated. That number, the so-called 55,000, includes the number of public servants who have been moved to let's say NAV CANADA structures. It also includes those who are leaving the public service entirely.
The bottom line, though, is the kinds of reductions I speak of, which represent in program expenditure terms, over the cycle of program review, a 22% reduction in program expenditures by the Government of Canada. That's the bottom line. And what program review has done for each department is to make it focus more clearly its priorities and its lines of business, if I can put it that way, and on more innovative ways of serving Canadians.
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Mr. Gilmour: Who determines how much of a downsizing there will be. For example, Indian Affairs' expenditures have gone up where others have gone down. Is that a Treasury Board directive, a government directive, a minister's directive? Where does that come from?
Mr. Harder: No, it is a cabinet decision taken in the context of the budget, and program review ministers - in that sense, remember the program review period in the budget announced some of the program review numbers - reviewed every department and then in the context of the budget announced the reductions. They reflect the accumulation of program decisions made by cabinet. Treasury Board's responsibility is, in the context of the business plans that departments bring forward on an annual basis, to determine whether or not they have a sound business plan that reflects the program review decisions in terms of bottom line.
We are managing an expenditure management framework today without any policy reserves. It's quite extraordinary. We've never done that before. This means that when governments wish to do new initiatives they have to be done through reallocation or in the context of a budget, and in that sense, adjusting the fiscal framework one way or the other. So it's a very constrained system, and Treasury Board's responsibility is to manage that on behalf of cabinet.
Mr. Harvard: I would like to think that at all levels or strata of the public service we're competitive with the private sector, and I really wonder about that. I'm particularly curious about how competitive the public service might be at the upper levels, because at the upper levels we count on strong leadership, and just in the last few days there have been a couple of notable departures. One that comes to mind immediately is Mr. Gravelle from Revenue Canada. How well are we doing? Are we competitive at that end? I think even you, Mr. Harder, if someone came along and offered you $500,000 a year, chances are you'd be off like a flash - that is, if you think like politicians do.
Mr. Harder: I would miss the pleasure of this.
Mr. Harvard: I'm sure you would. At least you'd have fond remembrances of my friend here.
The private sector is throwing some big bucks around, some really big bucks. We usually hear about the CEOs making $1 million or $2 million a year, but for every CEO who's making $1 million, you can be sure there are some vice-presidents at $400,000 and $500,000 and $600,000. That makes you guys look like pikers. So how competitive are we, and is it something we politicians should be concerned about?
Mr. Harder: I think this is an issue of significance and it is something parliamentarians should be concerned about, because you should be, I think, by the nature of the hearings you're holding, interested in the vibrancy and the health of the public service. This is a significant issue.
Let me answer it in two ways. One is to say we are not competitive with the private sector. It used to be that we had as our objective to be competitive with the private sector, from the EX-1 entry level to the executive category. And as you move up the EX-1 to EX-5 range and then enter the deputy range, that curve tends to go quite another way. As a result of the freezes, which extended for the executive category an additional year, the recent study we did at the board indicated that at the EX-1 we are 20% behind the private sector and that rises to I believe 85% behind at the EX-5 level. Deputies are in that sense off the Richter scale. A DM-3 equivalent in the private sector I think was at $1.2 million.
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You can say we're not competitive. I don't think anybody joined the public service in the expectation of becoming a millionaire. So the strategy we have to put in play to retain and motivate our senior leadership is not a compensation strategy, although I have to acknowledge that compensation is an issue, but is the feeling of efficacy, the feeling of commitment and making a difference. And to the extent the public service reform and renewal focuses on that leadership issue, on the sense of being meaningful for Canadians and relevant to building a country, I believe you'll continue to attract and retain executive leadership at a very competent level.
It is true that over the last number of months a number of senior colleagues of mine have left for the private sector, and almost in each individual case you can see they had the numbers, or they'd been around a while, or there was an opportunity of some significance. That has happened at various cycles of time, and we're going through one now.
Mr. Harvard: I understand your comment about people who stay with the public service, or who come to the public service, because they're looking for a particular kind of satisfaction or they have a certain kind of commitment. They're perhaps different animals from those who are attracted to the private sector. But at the same time, there are people who go to the private sector who are very smart, very intelligent; they have a hell of a lot to offer. They just happen to have perhaps either a need or a lust or whatever for big bucks, and when the big bucks come up, they go for it. We, as the public service or the public sector, may be able to afford missing out a few of those from time to time, but I would think that if the gulf is too large or too deep, we, the public service, can pay dearly for that.
In other words, I think there are times when perhaps we're penny wise and pound foolish, that sometimes we have to pay out, we have to invest, so that we can have the right kinds of leaders.
Mr. Harder: I don't dispute your point. All I'm saying is that it's not all on the compensation side. The retention has to include some of the other non-remunerative aspects of public service commitment.
I should also point out, and Colin Potts is an example of this, that you get people from the private sector who are prepared to work in government on an interchange basis, and indeed some of the costs of that are picked up by the private sector itself. I think it reflects not only their desire to have their senior partners and the like experience the complexities and understanding of government, but also their commitment to public service.
When I went to see the people at Deloitte & Touche about the possibility of an interchange, the compelling argument was making a difference and contributing to Canada and that we needed professional help in modernizing the public service in the area of comptrollership in this case, for example. I think the private sector will respond. I share your comments about -
Mr. Harvard: I know of a job right now that's worth $500,000 and it has Harder all over it.
The Chairman: Don't tell him.
Mr. Harvard: What do you say?
Mr. Harder: It was Harvard, not Harder.
Some hon. members: Oh, oh!
Mr. Harvard: I wouldn't be saying anything then.
The Chairman: Mr. Bryden.
Mr. Bryden (Hamilton - Wentworth): Let me ask a very blunt question that requires a candid answer. Are you experiencing any difficulties in the upper ranks of the civil service with the affirmative action program that exists in the civil service? Are you having difficulties with people feeling they're not advancing according to merit as they might be if the affirmative action program didn't exist?
Mr. Harder: No, and that's a candid answer. I think, quite frankly, the reaction among senior levels of the public service is that we have to do more to ensure the public service more closely reflects the diversity of the Canadian population at all levels. If we had the discussion in a very candid fashion with senior public servants, they would recognize that as a bigger challenge than the way you framed it.
Mr. Bryden: Then coming down in ranks.... The reason I'm asking the question is the federal public service is about one of the last places in this country for affirmative action, both in the private sector and in the public sector. We really are, and it's been rejected in other jurisdictions abroad - in Europe and the United States.
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I'm not on a hate trip with respect to the affirmative action program, but one of the fundamental criticisms of it has been that it has, despite its best intentions, created a climate where merit doesn't necessarily exist. Do you feel this is affecting the federal public service at any level?
Mr. Harder: I don't believe so. I'll ask Mr. Bouchard, as the chief human resources officer, to respond. I would also point out that there have been reductions in those groups as a result of program review reductions. So it's not protection of those designated groups in the face of reductions.
Mr. Bouchard: In an effort to better understand why some high flyers were leaving the public service and others staying, I contracted to a company for a short period of time to do an evaluation of that. They interviewed a small number of high flyers - executives who either had left or were staying. We wanted to know why they were leaving or staying, and that factor was never included in the answer. The interviews were absolutely anonymous and confidential. I didn't know the names of the people and the company didn't reveal them to me.
Mr. Bryden: I appreciate that, but I think if it's going to show up, it's going to show up at a lower level. It won't be at the entry level, although possibly, but at the developing level where you have people in their thirties and you're looking to them to advance into senior positions in the future.
My perception of what I've read of the experience outside of the federal jurisdiction is that there have been problems with people feeling they're not being treated equally in these affirmative action programs. If you say that's not your experience so far, I hope you will track that and look for that problem, because it is a serious problem if it manifests itself.
I would like to go on to something else, which is sort of on the same theme. I hope you can help me here. At an earlier meeting I asked for the descriptions and details of the special measures initiatives program, which is a Treasury Board program that provides money for equity employment issues within the public service. I have a copy of it here and I was looking through it. I would like to have a similar copy of this indicating how much each of these programs costs. An informal notation would be very helpful.
One observation is that the problem with this program - I don't believe it intends to do this - is that it hides the department-by-department spending on affirmative action, because it's actually financed outside of the various departments it applies to. I look here and see Environment Canada, Human Resources Development, Indian and Northern Affairs believe it or not, and so on and so forth.
I have a difficulty with that as a member of Parliament, in the sense that it was only by accident that I discovered this spending exists. The advantage of the committee system is that we run across these things, but there is a difficulty in that it tends to make that spending invisible. I think many people would like to see these programs reflected in the actual departments.
I would like to ask a couple of questions about two of them. I was really interested in this program for Environment Canada. The description of the program is the assessment of impact of downsizing on designated group members and develop support mechanisms and strategies to assist those affected. Isn't there a fundamental problem with a program like this? Here you are treating in a separate and special way these designated groups that you are cutting. Why should a person's physical appearance, whether they're black or aboriginal or female or whatever else - why should they get special treatment in the downsizing programs?
Mr. Bouchard: I can answer this one.
Mr. Bryden: Please.
Mr. Bouchard: First, I could obtain more information about that specific project. Our objective was not to protect members of those designated groups from downsizing. We wanted to monitor whether the effect of downsizing was greater on them than on the rest of the public service. That's all we were trying to monitor. We have indications that by and large the target groups are not adversely affected or favoured by the downsizing exercise.
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As far as getting you more information on budgets and the specifics, we can do that.
Mr. Bryden: That's okay.
I can't help it, but I have to ask one more along this line. It struck me as I looked.
Here's one for Foreign Affairs and International Trade. The description of the program is ``employment program for persons with intellectual disabilities''. Surely you don't mean that you've had a program for Foreign Affairs for the recruitment and hiring of people with intellectual disabilities? Surely you mean people with handicaps of some kind, but not intellectual handicaps. We're not recruiting people for their lack of brain power.
Mr. Harder: That hasn't been the traditional problem at External.
Some hon. members: Oh, oh!
Mr. Bryden: Thank you very much.
The Vice-Chairman (Mr. Bellemare): You've had seven minutes.
Mr. Bryden: That's fine, I will come back.
The Vice-Chairman (Mr. Bellemare): Will you have more questions later?
Mr. Bryden: Yes, I can come back.
The Vice-Chairman (Mr. Bellemare): I was on the list for the next one, but I don't want to abuse my new-found authority here.
Mr. Bryden: This is abuse of authority. We'll intervene, though, if he gets out of line.
The Vice-Chairman (Mr. Bellemare): The chair advised me that you wanted to leave relatively early.
Mr. Harder: I asked if I could be here for an hour, and adjusted my schedule for that eventuality. I have a meeting with some of my deputy colleagues on an important issue after this meeting.
Mr. Bryden: We'll get you out of here.
Mr. Harder: I'm always happy to leave my colleagues.
The Vice-Chairman (Mr. Bellemare): You said that 18,000 have left the public service so far?
Mr. Bouchard: For last year. From April 1995 to March 1996, almost 18,000 employees left the public service.
The Vice-Chairman (Mr. Bellemare): Including 7,000 terms, you said.
Mr. Bouchard: Including about 5,000 terms.
The Vice-Chairman (Mr. Bellemare): When it was reported in the newspapers.... Of course the media will transfer this into the number of positions. It gives me a shock in the morning when I read this 55,000 figure. Are we through now? Are we going to go cutting any more people?
Mr. Harder: Let me answer that.
You asked the president the very same question when he was here. I'm not going to repeat it verbatim, but the answer is the same. The 55,000 reflected the program review two additions - remember that I mentioned the $9 billion and then program review was an additional$2 billion. The estimated number of public servants who would be leaving as a result of program review decisions is the responsible factor in the additional 10,000 or so.
As you know, from the very beginning program review was not designed to achieve a number of public service reductions, it was designed to achieve program reductions. We are on course to achieve it, but program review has another two years to go. I think the numbers Mr. Bouchard has indicated, and as we track this through, were on target. Those are our best estimates at this time, given the decisions made in departments to meet those program review targets and decisions.
In that context, when he was here the president gave a rather hopeful message. There is stability in the system in terms of program expenditures. He talked about -
The Vice-Chairman (Mr. Bellemare): How do you respond to the sense of insecurity out there? Are there going to be any more people designated?
Mr. Harder: I can't answer that question, and I don't want to presume today by saying there will not be one more designated person, because what we are monitoring and focusing on is expenditure reductions. The business plans of departments focus on how they will accomplish that.
The Vice-Chairman (Mr. Bellemare): I'm not interested in finding out if one or two, here and there, are going to be designated. I'm interested in finding out the -
Mr. Harder: The budget tracks of departments are clear and they are reflected in the budget statements. The president's comment here in answer to your question was that we are stabilizing program expenditure at the end of program review, and to that extent there is stability.
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Having said that, no large organization can promise there won't be any change, because there will always be change as we try to improve service delivery and as we look at ways of partnering with other jurisdictions in finding more innovative solutions. But in terms of program expenditure levels, program review one and two, once implemented, at least in terms of this government's decisions, are that we will be at a stable funding of program expenditures.
The Vice-Chairman (Mr. Bellemare): We're not through with program review.
Mr. Harder: We're in the process of implementing it. Program review isn't an announcement. It's not a decision made. It's actually implementing it on a day-to-day basis, and it's over a four-year period.
The Vice-Chairman (Mr. Bellemare): Ordinary persons relate to numbers; they think in terms of the horrible number of 55,000 jobs that could be lost. Of course what is not mentioned is that a lot of those jobs could be transferred to the private sector. NAVCAN is a beautiful example. It's beautiful in every sense of the word. I commend that particular transfer.
Mr. Harder: Yes, and the economic performance of the Ottawa region has created a number of jobs at the very same time.
The Vice-Chairman (Mr. Bellemare): In the figure of 18,000, did you include the NAVCAN group in transportation?
Mr. Harder: No, it hadn't been done.
Mr. Bouchard: NAVCAN became effective on 1 November, so those 6,000 or thereabouts employees were not included in the 18,000.
The Vice-Chairman (Mr. Bellemare): Okay.
I don't want to abuse my position. I want to come back with more questions, but I want my colleagues to participate in this experience.
Mr. Bryden: He only has two minutes, and we did promise he would get out.
If I may, Mr. Chairman, I'd just ask a couple of very quick questions.
A suggestion has been given to me, and I think it's an important point. In your outlook documents, you suggest you've changed to a policy where instead of imposing leadership, you would show leadership. That always sounds good, but it always the raises the fear and the question in my mind that it's an abrogation of leadership. Can you comment on that?
How can I be sure that, if you don't have a hands-on role with the other departments, you're not going to lose the kind of control you've had of those departments - and good control, I might say?
Mr. Harder: Your question is very important, and it's one of the reasons we wanted to establish the blue ribbon panel of the private sector. I think you will be satisfied with the level and calibre of people who are prepared to devote a fair amount of time over the next number of months.
We, as all large organizations, are struggling with what is the appropriate balance of comptrollership in large organizations. There's a fair amount of literature on this now. Large organizations are themselves examining what's the role of a board of directors, which we are, in some respects, as the overall corporate governance.
There was a very interesting piece in Business Week this week that said the new motto for corporate governance is NIFO: ``Nose in, fingers off''. I like that, because it underscores the direction we're moving to with business plans in the spring and with performance documents in the fall. And I dare say, we need to link this to Parliament. That's why the improved reporting to Parliament project is so important in public service renewal.
If we link what we are doing in departments in terms of focusing our business lines and being, frankly, more transparent in the information we provide - the part IIIs are not the most enlightening documents - and if we can bring parliamentary understanding to what we're out for in terms of our expectations for the year and have fall performance measurements so you members of Parliament can in fact ask output and outcome information that's relevant, we'll improve the cycle.
That's part of our framework of responsibility, and we have to show the leadership of moving in that direction. But I am determined that in this process we do not lose control in the sense of appropriate probity, financial accountability and the whole notion of the expenditure management system having efficacy.
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The role for us at the board is going to be a modern central agency that provides leadership and framework policy for the broad management functions of the public service and to do this in ways that strengthen accountabilities, including parliamentary information, so that we can all focus on better performance of public institutions.
Mr. Bryden: I would like to make just one comment, and I thank you for that.
If I may make a very sincere suggestion to you, please look very carefully in that context at the existing Privacy Act and Access to Information Act. As a parliamentarian, these two pieces of legislation represent significant barriers to me getting appropriate information. Don't leave it to the justice department.
The Vice-Chairman (Mr. Bellemare): Thank you very much, Mr. Bryden.
There was a question I brought up a few meetings ago about a $9-billion amount. Two years ago the government spent something like $8.9 billion in contracts; a year ago it was $8.7 billion. Not to confuse anything, let's round out the figures at $9 billion. My basic question today is the same as it was at the previous meeting and it's going to be the same at the next meeting. How much of this is for service contract, how much is for procurement, and how much is for construction contract? So that I can get a handle on the service contract, how much money is spent on service contract? That's my interest.
Mr. Harder: Mr. Bellemare, I'm sure I couldn't answer that as well as Rick Neville could, as Mr. Neville is the assistant deputy comptroller general and has responsibility for contracting policy. He'll attempt to answer it. If he needs to answer it in more detail in writing, we'll do that. I wasn't here when the original $9-billion question was asked.
Mr. Richard J. Neville (Assistant Secretary and Assistant Comptroller General, Financial and Contract Management Sector, Treasury Board Secretariat): Thank you for the opportunity of responding.
As you are aware, we do prepare an annual report in terms of the contracting that takes place within the federal government. That particular report does break out the contracting between goods and services.
The Vice-Chairman (Mr. Bellemare): What is it?
Mr. Neville: I wouldn't want to give you the numbers because I'd be ballparking them.
The Vice-Chairman (Mr. Bellemare): Can we get that?
Mr. Neville: I'd be more than pleased to provide that to you in the same format you've asked for it.
The Vice-Chairman (Mr. Bellemare): We still have one minute with the boss.
What is the current status of la relève, which is a big interest of mine? When will Parliament and this committee be informed of its progress? Because we're interested in la relève. The public service at this moment is being strangled and it needs to be rejuvenated, in my words.
Mr. Harder: I think your concern is well placed. I think the notion of the public service being strangled is a bit extreme.
La relève is, broadly speaking, a series of initiatives the government is examining to bring vitality and renewal to the public service, which will improve the public service that we pass on to those who will replace us. At a recent deputy retreat we focused on a series of initiatives that we are examining. I would imagine that in a very short while the clerk, as head of the public service, will be making some comments on la relève and specific initiatives that are designed for this. There is no mystery to it. La relève is doing labour relations right this round, if we can achieve some simplification.
Today's complexity is one with 72 groups, 106 subgroups, 79 bargaining units,72 classification plans, 63 collective agreements, 80-plus pay plans, 80-plus rates of pay and150 allowances and premiums. We can probably simplify this a little.
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If la relève is, generally speaking, modernizing and bringing vitality to the public service and improving the future of the public service -
The Vice-Chairman (Mr. Bellemare): I apologize then. I misunderstood. I thought la relève was something different from just a diminution of categories at the levels of work.
Mr. Harder: No, I didn't say it was that alone. I said it is a wide variety of initiatives, of which collective bargaining is one, modernizing staffing is one, dealing with Mr. Harvard's concerns on executive retention and compensation is another, looking at the way we manage executive -
The Vice-Chairman (Mr. Bellemare): It sounds more like public service renewal than the rejuvenation of the public service.
Mr. Harder: Mr. Bellemare, I would hazard to say that the issues I've just outlined and others that I could mention are very much in the minds of public servants as the issues -
The Vice-Chairman (Mr. Bellemare): What is happening at la relève that is the rejuvenation of the public service? Are we looking at a specific level, like the deputy ministers level, executive levels or across the board?
Mr. Harder: No, la relève is focused on all levels of the public service. There are some initiatives that obviously will focus on different levels, but it is not one initiative. It is not one aspect. It is the broader chapeau to a more focused attention on human resource management across the Public Service of Canada involving deputies and others to modernize and to improve the performance of the public service.
The Vice-Chairman (Mr. Bellemare): I don't want to abuse your time on rejuvenation. Perhaps you want to finish off on that or finish it when you come back. I really like to have these conversations with you because I'm getting more and more enlightened on what is happening to my public service.
The next meeting is on Tuesday, February 4, 1997, when our witness will be the Clerk of the Privy Council.
Mr. Harder: He undoubtedly will speak to this very subject.
The Vice-Chairman (Mr. Bellemare): Yes, he will speak on this subject.
Mr. Harder: Thank you.
The Vice-Chairman (Mr. Bellemare): Thank you.
Mr. Bryden: Hang on just a second, Mr. Chairman.
The Vice-Chairman (Mr. Bellemare): He's the only one leaving.
Mr. Bryden: Mr. Harder is going because he has to go. I would like to just have a word withMr. Neville, if I may, with respect to the contracting question.
The Vice-Chairman (Mr. Bellemare): Mr. Bryden, please address the chair.
Mr. Bryden: I did actually, Mr. Chairman.
The Vice-Chairman (Mr. Bellemare): I'm of the understanding it was only Mr. Harder who was leaving.
Mr. Bryden: Yes. Mr. Neville happens to be here, though, and it would be an opportunity to ask a contracting question.
The Vice-Chairman (Mr. Bellemare): What about for the rest? Is there an entourage that leaves with him?
Mr. Bouchard: I was part of the same meeting.
Mr. Harvard: We have to end the meeting.
The Vice-Chairman (Mr. Bellemare): Good, then the meeting is adjourned until our next encounter. Thank you.