Government Operations Committee on Oct. 7th, 2010

[The Chair, Liberal, John McKay]

Thank you.

Any other comments? May I call the vote?

Those in favour?

Those opposed?

Okay. The motion....

Thanks very much for leaving me with that tie vote--again.

The motion passes.

(Motion agreed to)

[The Chair, Liberal, John McKay]

May I call Madam Barrados, please.

Madam Barrados, welcome to the committee.

I know you have an extensive commentary because I tried to read some of it, my gracious me. I was going to say we look forward to what you have to say, and indeed we do. I appreciate your effort to come before the committee. As you know, there are opening remarks and then members will ask questions.

Welcome to the committee, Madam Barrados, and I would anticipate that you would introduce your colleagues.

[Maria Barrados, President, Public Service Commission of Canada]

Thank you and good morning.

Mr. Chair, I would like to begin by congratulating you on your election as the chair of the committee; it is always a pleasure to appear before the Standing Committee on Government Operations and Estimates. I am here with Donald Lemaire, Senior Vice-President, Policy Branch, and Elizabeth Murphy-Walsh, Vice-President, Audit and Data Services Branch, to discuss the 2009-2010 Annual Report of the Public Service Commission of Canada, as well as nine audit reports and a study on the use of temporary help services within the public service. They were all tabled in Parliament on Tuesday and were referred to this committee.

For the benefit of the new members, the Public Service Commission (PSC) is an independent agency accountable to Parliament for safeguarding the integrity of staffing in the public service and the political impartiality of public servants. The PSC is independent of ministerial direction, and we hold executive authority for hiring. We report annually to Parliament on our activities and results.

The PSC's 2009-2010 annual report covers the fourth year of operation under the Public Service Employment Act (PSEA). As of March 2010, there were 84 organizations, representing over 216,000 individuals, to which the PSC had delegated its appointment authority.

In 2009-2010, the public service continued to grow but at a slower rate, 3.4%, as compared with 4.5% in 2008-2009. There was also a slowdown in hiring and staffing activities.

Based on our oversight activities in 2009-2010, significant progress has been made in implementing the PSEA over the past four years. The essential elements of the PSEA are in place, and there continues to be advances in achieving its objectives. The core values of merit and non-partisanship, and the guiding values of fairness, access, transparency and representativeness are generally being respected across the public service.

Still, more work needs to be done to ensure that managers fully understand how to apply the core and guiding values to their decisions. We have found that the behaviour of managers suggests that the values, and their interconnections, are not yet sufficiently understood and that staffing decisions are not yet sufficiently based on values.

We also note that there are persistent inconsistencies across organizations in the implementation of the values-based approach, for instance, in the use of advertised versus non-advertised appointment processes, and in the lack of documentation of decisions. A more concerted effort is needed from everyone in the public service to ensure a values-based approach to staffing.

This brings me to the issue of temporary help services and short-term hiring in the public service. They represent useful tools to address short-term needs such as temporary workload increases. PSEA organizations spent approximately $300 million on temporary services in 2008-09, a threefold increase over the past decade, most of which occurred in the national capital region. This upward trend is of concern, as it poses risks to the integrity of the staffing system.

At the request of this committee in April of 2009, the PSC undertook a study on the use of temporary help in the public service. Our study found improper uses of temporary help contracting to address long-term staffing needs. Managers are given little guidance on how to consider the PSEA when using temporary help. The result of the pattern of usage observed was a circumvention of the PSEA. We also found that about one in five temporary workers was employed in the public service following their contract, with the majority appointed to permanent positions.

The PSC will consult with Treasury Board Secretariat and Public Works and Government Services to address issues raised in the study and to provide guidance to deputy heads on the appropriate use of this mechanism in relation to the PSEA.

Another area of concern is time to staff. While there has been a notable reduction in time to staff collective advertised processes--from 27.4 weeks in 2007-08 to 24.7 weeks in 2008-09--the average time to staff indeterminate, or permanent, advertised positions has remained relatively stable at around 23 weeks.

Time to staff a position can be significantly reduced within the existing PSEA framework and policies without compromising our staffing values. Our research has shown that further efficiencies can be achieved through strong HR planning and project management. We are encouraging organizations to be more aggressive in addressing time to staff, including establishing benchmarks.

I would now like to turn to our audits. The PSC identified three recurring themes in these audits: first, appointment decisions not always being fully documented; second, poor rationales being used for non-advertised appointment processes; and third, the ongoing need to improve quality control on appointment processes.

As a result of our audit, we have imposed additional conditions on the delegation of staffing authorities at the National Parole Board. The National Parole Board has provided us with an action plan that outlines how the organization will respond to the audit recommendations. The chairperson of the board will also be required to provide us with semi-annual reports on progress made against the action plan.

As a result of its follow-up audit, the PSC has removed conditions it had placed upon the Canadian Space Agency following its 2006 audit. No additional conditions have been placed on any other entities audited by the PSC this year.

Now I'd like to turn to the subject of employment equity and the progress made with respect to the recruitment of four designated groups. Three of these groups--women, visible minorities, and aboriginal peoples--are now being appointed to the public service at a proportion exceeding their workforce availability. We continue to see increased hiring of visible minorities. They account for 21.2% of external appointments, up from 18.8% in the previous year. Persons with disabilities remain the one group where the share of appointments is below their workforce availability.

The PSC is also committed to making federal employment opportunities here in the national capital region available to all Canadians. We have seen an increased rate of application from outside the NCR, as well as a higher rate of appointment of those applicants for both officer and non-officer jobs in the NCR. This means that the national area of selection policy is having a positive effect and helping to improve access to public service jobs for Canadians.

In looking to the future, we know this is a critical time for Canada's public service and for the PSEA. There are early signs of the rate of growth of the public service slowing further in the months ahead, as well as a decline in the level of staffing activity. Targeted human resources plans, including succession planning and talent management, will be increasingly valuable tools for managers as they seek to hire the right people within available budgets.

We have seen progress in key areas of concern, and the system has consistently demonstrated an ability to learn, respond and adapt to change.

The PSC will continue to support departments and agencies to become more efficient by providing innovative services, tools and technologies.

We are also moving forward with a preliminary assessment of the PSEA. We will be providing parliamentarians with a spring report that will assess the effectiveness of the legislation and recommend areas for change. This assessment will contribute to the formal legislative review of the PSEA led by the President of the Treasury Board.

I understand this committee has a very broad mandate, including oversight of the Public Service Commission. Your committee was asked to recommend to Parliament my appointment as president. You review the results of our work in our annual report, audits and special reports, as we are doing today. You also recommend for approval our estimates, reports on plans and priorities, and departmental performance reports.

These documents tell the story of how we are managing our finances and other challenges: dealing with sunsetting money, operating internal cost-recovery services, absorbing strategic review reductions, and dealing with the operating budget freeze. I look forward to discussing them with the committee.

My mandate ends in May 2011, as do the mandates of the PSC's two part-time commissioners. I would like to thank the members of this committee for your interest in the federal public service and the work of the Public Service Commission.

Thank you. I would be pleased to answer any questions you may have.

[The Chair, Liberal, John McKay]

Thank you very much, Madam Barrados.

I'm going to call now on committee members to have the first round of eight minutes each.

I believe Madam Coady leads off.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

Thank you very much.

We certainly appreciate you being here this morning, for the hard work that you do, and for having patience with us while we attended to committee business. So thank you very much, and yes, I agree with the chair, it was a comprehensive package of information that we had to review, and it was most enlightening.

I'd like to ask the first question concerning pretty much what you said toward the end of your opening remarks, and that was the challenges with the budget issues. I'm going to lump them all into one particular area. You are dealing with sunsetting money. You're dealing with operating internal cost recovering services. You said that in your opening statement.

I do know that you had to transfer 6.5% of your budget to another department because of a shortfall, and I also know that you're dealing with a budget freeze. It's not only the 6.5% that you were required to give under review and under a shortfall, but also that you have a budget freeze, and actually, as part of the strategic review, perhaps even a 5% decrease.

Can you talk to the challenges and risks that poses for your department, and to why you needed to give that 6.5% to another department? Thank you.

[Maria Barrados]

I would just ask for clarification on the 6.5%.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

I understood that you had to give moneys to another department last year under the budget. I think Statistics Canada required some money.

[Maria Barrados]

I see, yes. It wasn't 6.5%, but we were required to transfer $133,000 and $225,000, for a total of $358,000, for savings. One amount--$133,000--went to the census, and for procurement savings there was $225,000. There was a requirement to do that.

With respect to the general question that is being asked, there is no doubt that the Public Service Commission is facing significant financial pressures. When I talk about sunsetting money, this is the money we had for our electronic system, so this is the system for all Canadians to be able to apply to jobs, and the electronic screening behind that. We have since managed to fund that within the government, so government departments are paying for the utilization of that system.

There are significant pressures, because we are in cost recovery, for parts of our services. As staffing services go down, we have issues in terms of being sure that we can cover those costs. It means that as an organization, we have to manage our books and start the year with significant reserves. So it really requires quite a bit of tight financial planning on our part.

We had strategic review cuts. We've done the second year. We have one more year of cuts, in the order of $4.3 million that we had to take out of the budget, out of the base. In addition to that, we have an operating budget freeze, which we estimate will take about $1.3 million out of the base every year—this past year and for the next two years. So we have these ongoing reductions.

I'm not unique; the same thing is happening in other government departments. To this point, I think we can manage them, so we are doing a number of things. We are tightly managing our new staffing, so as people leave we are tightly managing the replacement of the new staff. My executive committee is actually reviewing all new staffing requests. We have regular reports on where we are in the budgets, and we have a lot of discussions on what the priorities are.

As well, we are looking to improve the efficiencies of our operations, and fortunately we have been able to get the money for the IT infrastructure we need. But the consequence of that will be that as we replace some staff and not others, we are going to have some people in the wrong spots. So we are making sure we will have money to do training to help reallocate people.

As I said in my opening statement, on the HR side this means more than ever that public service managers will have to manage, and manage very well and very tightly. It is true on the financial side. As I think many members of this committee know, I spent many years in the Office of the Auditor General, so I'm preoccupied with both the financial and the HR side of this. I think as an organization, we are managing.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

Thank you for that report.

I'm just wondering if there is a corollary. You talked about tightly managing new staffing, and you also talked in your report about temporary workers. Could there be a corollary between the two? I'm asking about this generally, not necessarily about your particular department, but overall. We have a tightening of our belts and we have an emergence of these temporary workers. Do you see a corollary between the two?

[Maria Barrados]

There's nothing wrong with temporary workers if they're temporary. What is wrong with the situation we have now is that they're not really used strictly for temporary work. There tends to be an ongoing relationship. It tends to be for long-term relationships, and it tends to be a way to recruit into the public service.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

I'm going to come back to that question, if I may, because I have one more quick question before we go to the next person.

The Privacy Commissioner this week in her annual report talked about the political impartiality monitoring approach--I think PIMA is the acronym--which I understand is under your department's responsibility. It monitors—this is from her report—“the Internet, including media outlets, personal websites and social networking sites such as Facebook, for signs of potentially inappropriate political activity by public servants”.

Now, you can appreciate that there was a concern raised when the Privacy Commissioner put this in her report. It sounds a little like Big Brother, especially when people want to participate in the political process in some ways and means.

Could you please discuss this with us and allay the concerns we have when we read this in the privacy report?

[Maria Barrados]

Thank you for the question.

I was actually very surprised when I saw this in the report from the Privacy Commissioner, because I have a letter from last May telling me this file was closed.

Perhaps I could just take a minute and explain the two principal activities that we are concerned with at the Public Service Commission. We have a broad mandate to protect the political impartiality of the public service. There are two parts of this mandate. One is if public servants want to run for political office, they must come to the commission for permission to run and we determine whether their running would in any way compromise the non-partisan nature of the public service.

It has a lot to do with the kind of job they do, the kind of job they go back to if they lose, and the conditions that are imposed when they are campaigning. There are some technicalities where the commission has to be very involved because of the structure of the law.

The second part of the act says that public servants should not be active in such a way that it compromises the non-partisan nature of the public service, so it's speeches, signs, participation in campaigns, but not necessarily being a candidate.

For us to discharge this, we have done two things. One, for those people who are candidates, we do monitor that very closely. We do follow up particularly when they're still working in campaigning. We follow a lot. We scrutinize closely to make sure they adhere to the conditions. We also do some checking when there are a number of campaigns to see if any of the candidates are public servants and they didn't come to us.

With respect to the other general activity, it's just general media monitoring. The first thing that the Privacy Commissioner did was put those two activities together. It was fairly intensive for a very select number of people who were candidates but not for the others. She goes on to say that we have databases that put together opinions, political affiliations, personal causes, hobbies, religious affiliations, and group memberships of past and present public servants. We have never done that, we will not do that, and we are not going to do that.

[The Chair, Liberal, John McKay]

Thank you, Madam Barrados.

Ms. Bourgeois, you have eight minutes, please.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Thank you, Mr. Chair.

Good morning, Ms. Barrados, and thank you for being here. I also want to say hello to your team.

I would like to start by thanking you for responding to a request from the members of this committee. Further to a motion by the Bloc Québécois, parliamentarians began asking questions about the astronomical costs that the government was supposed to assume given that it was going through private agencies to hire staff.

We remembered finding out that, in 2009, the federal government had paid out more than a billion dollars to these employment agencies. We also learned, through you, in your role as president of the Public Service Commission of Canada, that the government had a site or mechanisms in place to hire staff. You then submitted a report to us.

You are very brave, in my opinion, because since I have known you, since you have been on the job, you have worked very hard on the staffing process within the public service. I know the process is your baby and matters to you a great deal. If I understand correctly, unfortunately one of your findings was that problems persist with the staffing process, which you have worked so hard on and believe in just as strongly.

I would like you to tell us why managers are having so much trouble finding staff, why they are not using the staffing process that you put in place correctly or as frequently as necessary.

First, however, I want to come back to your report and the matter of temporary help services. On page 6 of the French version, it says that organizations used temporary help contracting services improperly. The study also revealed two practices that suggest the long-term use of temporary help services.

Does that mean, Ms. Barrados, that the public service has a parallel staffing system to the one that is currently in place? Does that mean that, even though a staffing system exists under the Public Service Employment Act, temporary help services—agencies that recruit casual employees—are being used to such an extent that it has created a second staffing system within the public service? Did I make myself clear? Do you understand what I mean?

[Maria Barrados]

Yes. Thank you for your comments and questions.

Exactly, we now have a staffing system, especially here, in the national capital region. It is known, we have information on the people, their background and so forth. But we have another system for contract employees. And that system, which enables people to work in the public service on contract, does not provide us with the same information.

During the study, we had a very hard time obtaining information on workers' names, which is the only way we can compare the work they did in the past with the work they are doing right now.

We concluded that we have another system, one that is complicated and difficult to monitor, for reasons that are not always clear. Actually, I think this is a situation where managers in the public service did not oversee the system; it is a bit of an ad hoc system.

Now, it is extremely important that we oversee all aspects of human resources, especially in light of the challenges we face as a government.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

And that second system, Ms. Barrados, is the one costing us a billion dollars, because it is a parallel system. It is a system of agencies, where you have government managers, for all sorts of reasons mentioned in your report, turning to those agencies whose name has come up repeatedly.

Have you met with these agencies? It says here that there are 176 suppliers, but the big winners are the agencies that were awarded $133 million in contracts over 5 fiscal years. Another agency received $72.5 million, and another, $43.8 million. That is a huge amount of money! Especially when you consider that the government has staffing mechanisms that you put in place, in addition to a Web site where anyone can apply.

According to your report, this means that people who come from agencies are bypassing the Public Service Employment Act system, so we have no security mechanisms covering them. What's more, these people are taking the places of others, because they are able to gain seniority and experience. Yet they do not go through the mechanism in place to get a job, and during their 90 days of employment, they very often make friends with people who give them full-time jobs.

Ms. Barrados, this is quite a situation. Have you looked into who these three agencies are? Are they agencies with close ties to the government?

[The Chair, Liberal, John McKay]

Madame Bourgeois has left you with 45 seconds to respond, Madam Barrados.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

I am sure she can respond as she answers other questions.

[Maria Barrados]

I can try to answer quickly. First of all, the billion dollars includes professional contracts, whereas the study dealt strictly with the $300 million. That is another mechanism, we are talking about the $300 million.

Yes, we do have a staffing system, and, in my view, as far as all long-term positions are concerned, an ongoing link must be established through the PSC staffing system.

We have done the work for the contracts, but obviously I have received calls from the agencies, and I will be meeting with the people from the agencies in the days ahead.

[The Chair, Liberal, John McKay]

Thank you.

Mr. Warkentin, eight minutes, please.

[Chris Warkentin, Conservative, Peace River, AB]

Thank you, Mr. Chair.

Thank you, Ms. Barrados, for being here again. We appreciate every time that you come. You always bring something new to the table and give us an education. We appreciate it.

I was reading your report yesterday on the use of temporary help services and I want to ask a couple of questions about figures in it. Figure 8 on page 23 shows a graph that demonstrates the different types of help services over the last number of years. I notice that there's a reduction in the “term salary cost” and, it seems, a corresponding increase in the “temporary help services expenditure”.

Could you describe for us what the rationale might be, or whether there is a rationale that you've heard from different departments or agencies as to why they might have changed from one to the other? I'm wondering whether it's simply the issue of managing the employee.... I guess I shouldn't presuppose what the reason is.

Do you have any information on that?

[Maria Barrados]

It's a very good question, and it's very hard to pin down what is happening there. There are a couple of things I could suggest that might have contributed to this.

One is that when new legislation, the Public Service Employment Act, was passed, it significantly tightened up casual employment. Casual employment had been 120 days, and it was tightened to 90 days. It was restricted to 90 days with really very little room for any kind of exception. That happened roughly in that time period when we saw the rise of the temporary help services.

There were also some changes, particularly in the national capital area, in ways to use the temporary help, which were actually broadening. One is that we have seen a phenomenon now whereby we have professional workers coming in as temporary help. There is a notion that temporary help is clerical and support staff, but about 37% of the people in our sample were actually professionals, some of them earning very high incomes. That's during the same period in which there were other mechanisms whereby you had some of your high-tech workers coming in through executive exchanges, which were shut down. So we have a phenomenon of things being shut down and tightened, and then a growth in the temporary help.

[Chris Warkentin, Conservative, Peace River, AB]

I appreciate that.

In terms of the different types of personnel, I notice in one of the graphs that you have separated the clerical staff from the more professional and the technical, and I'm wondering whether you have noticed a corresponding relationship between the type of qualifications these individuals have and the duration of the contracts.

[Maria Barrados]

The professional services people tend to have the longer contracts.

[Chris Warkentin, Conservative, Peace River, AB]

Have you followed that up at all? I'd be interested in why departments or agencies.... I see these different graphs, and you can't just imagine that it's because of an increased workload that they have to bring a person with a specialized qualification in for a duration of a year—or more than a year, in some cases. There must be something else at play.

Have you done any individual case studies, pulling out these individuals and trying to learn the story as to what's going on?