National Defence Committee on Nov. 6th, 2014

[The Chair, Conservative, Peter Kent]

Good afternoon, colleagues.

We are here, pursuant to Standing Orders 110 and 111, and the motion adopted by this committee on Tuesday, October 7, 2014, to consider the order in council appointment of Mr. Bill Jones to the position of associate deputy minister of National Defence, referred to this committee on Friday, September 19, 2014.

Mr. Jones, welcome to this committee. Would you make your opening remarks, sir, please.

[Bill Jones, Associate Deputy Minister , Department of National Defence]

Thank you, Mr. Chair and members of the committee.

I first want to thank you for giving me time to meet with you so soon after my taking on this appointment. I will come back to this point at the end of my brief remarks. Certainly it's been an incredible several weeks here for me at National Defence, with many issues.

I have devoted a good part of my life to public service, and it is certainly my great pleasure to continue to serve Canada in the position of senior associate deputy minister of National Defence following my many years of experience in both the federal public service and the provincial public service of Saskatchewan.

First let me tell you a few things about myself. I am an economist by training, having earned both a bachelor and master of arts from the University of Guelph. I have also lectured in economics at both Queen's and Guelph.

It was immediately following my time in academia that I joined the public service for the first time, assuming the role of an economist in the taxation and fiscal policy branch of the Saskatchewan Department of Finance. This was only the beginning of my long tenure with the Government of Saskatchewan. Over 17 years I occupied a variety of positions of increasing responsibility in the Department of Finance, ranging from the director of finance and administration to the senior associate deputy minister of finance of the treasury and debt management division. This experience gave me significant insight into the responsibility of the treasury activities of the province, including provincial investments, cash and debt management, relationships with domestic and international businesses, as well as financial institutions and credit rating agencies. I was also responsible for overseeing the preparation and submission of regulatory filings for capital markets.

In 1995 I was appointed deputy minister of finance and secretary to the treasury board for the Province of Saskatchewan. In this position I was responsible for financial leadership, such as directing fiscal, economic and financial policy, oversight of pension and benefit plans, preparing and implementing the budget and estimates of the Province of Saskatchewan, providing advice and recommendations to the premier, ministers, Treasury Board, and cabinet, as well as managing the administrative affairs of the Treasury Board, and managing federal-provincial issues in collaboration with my federal counterparts.

While I enjoyed this challenging position immensely, after four years I decided to diversify my experience and take a job with a Saskatchewan crown corporation. In 1999 I became the vice-president of corporate and financial services as well as the chief financial officer for Saskatchewan Power Corporation. In this position I was responsible for the financial leadership and direction of the corporation, including treasury and financing operations; business planning and risk management; accounting and internal controls, including audits; corporate procurement; pension plans; and property management.

Following nine years in this position, I returned to the public service but at the federal level. I moved from Regina to Ottawa where I was appointed to the position of assistant secretary, pension and benefits sector, within the Secretariat of the Treasury Board of Canada, in 2009. My responsibilities at the Treasury Board included leadership and stewardship of the government's pension and benefit plans; overseeing the development of legislative, regulatory, and policy changes; overseeing and defining the parameters of negotiations on major contracts; ensuring the effectiveness of relationships with other government departments, central agencies, and the bargaining agencies.

In 2011, I made the move to the Canada Revenue Agency, where I was appointed as the deputy commissioner. My primary objectives in this position were to support the commissioner in the delivery of his and her mandate—I say his and her because there were both a lady and a gentleman there in the time I was at the CRA—and the responsibilities under the Canada Revenue Agency Act, and ensure the seamless function of the organization's day-to-day operations. I also supported the achievement of the objectives, including contributions to deficit reductions and strengthening and modernizing our business process to serve Canadians better.

After nearly three years in this position, I was appointed to my current position as senior associate deputy minister and assumed my responsibilities toward the end of the summer.

While I did not choose a career in the military, my family has a very strong affinity with the Canadian Armed Forces. My grandfather served for many years, and my father was in the U.S. Air Force. I grew up in close proximity to Trenton. The Trenton air force base, or 8 Wing, was just across the bay from Prince Edward County, as we know it today. In August one of the first things I did was take the opportunity to visit 8 Wing when I was in the Trenton region.

Like my colleagues in uniform, I deeply believe in service to the country. I believe my extensive experience will serve me well in taking on my new roles and responsibilities. Many years of experience in both provincial and federal public service have positioned me to take on the new challenge of working at the Department of National Defence.

My one final thought, as I indicated at the beginning, Mr. Chair, is that these past several weeks have been an incredible period for me ,and I think it's fair to say, for the department if not for Canada. Numerous activities have been taking place in the department. It was an incredible time to join, and I look forward to further opportunities and interesting challenges.

Thank you very much.

[The Chair, Conservative, Peter Kent]

Thank you, Mr. Jones.

For our first round of questions, Mr. Norlock, please.

[Rick Norlock, Conservative, Northumberland—Quinte West, ON]

Thank you very much, Mr. Chair, and through you to the witness. Thank you for attending today. I guess you might say this is one of your job interviews.

We usually have certain questions which you've probably come across before, so I'll start by saying that it's obvious from your introductory statement that you have extensive experience in the public service.

Of all the departments and agencies you've been in, can you tell us some of the successes and achievements you've witnessed, and more specifically, that you've presided over?

[Bill Jones]

Mr. Chair, and through you to the member, thank you for the question.

In anticipating that question, one example I would give, I would go back to my time in Saskatchewan in the Ministry of Finance. By way of context, Saskatchewan went through some very difficult times in the eighties and early nineties, but earlier in the eighties we were doing quite well. We went through difficult times and since have returned.

If you want to understand how any organization works, whether it's corporate or government, you go through it from the point of view of watching your credit rating go through the floor and then go from the top to the bottom and then back up. I can tell you, that was a very instructive lesson for me.

I'm proud of the relationships and responsibilities that were built up in dealing with financial institutions both in Canada and internationally that allowed us to continue to finance the activities not only of the provincial government, the deficit we were running, but also the investments in the crown corporations. During very difficult times we were able to continue to work with international financial institutions and the credit rating agencies to keep the province going.

[Rick Norlock, Conservative, Northumberland—Quinte West, ON]

I'm going to try to gear down into that general overview you gave us. I wonder if you could talk to us about your methodology and how you tackled these issues you just referred to. You're also aware of the apparatus in federal government. How would you tackle some of the issues specifically related...and how might they relate to the manner in which you tackle issues you're going to be faced with, significant military procurements in particular? How are you going to assist the minister and ministers? There's an overlap of ministries, as you know. How are you going to use your previous experience, the types of processes you used to be able to come to successful conclusions?

[Bill Jones]

Mr. Chair, and through you to the member, thank you again for the question.

I would make two points that I believe were important to the way we conducted business in Saskatchewan during very difficult times, and I think they're equally important today.

First, I think it's fundamental that, whether dealing with financial institutions, credit rating agencies, or corporations that want to sell things to the government, you deal with them in a very market-related way. That was very much the approach we took in Saskatchewan. We took a very market-oriented approach.

Second, we developed ongoing relationships with market participants. In doing so, we were successful in keeping the name of Saskatchewan, a relatively small province, at the top of the list of certain financial institutions during very difficult financial market times.

I think that being market-oriented, aware of the industry, is certainly important, as well as building solid business relationships. It was important and is important going forward.

[The Chair, Conservative, Peter Kent]

Thank you, Mr. Jones.

That's time, Mr. Norlock.

Mr. Harris, please.

[Jack Harris, NDP, St. John's East, NL]

Mr. Jones, I want to thank you for joining us today, and I am pleased that you were able to come.

I am extremely impressed by your vast experience, particularly in service to the Government of Saskatchewan and the Government of Canada. This kind of experience at the senior level of the federal public service makes me feel that we have knowledgeable and experienced people running our federal public service. I am glad to have you with us today.

I also want to touch on the Saskatchewan experience that Mr. Norlock questioned, because I think we are all aware that the financial circumstances in Saskatchewan were, particularly with respect to credit rating and debt, fairly dire. After the early nineties, there was some change of government and a lot of work done to restore financial stability.

What I am impressed with is that you were there before that as assistant deputy minister, and you stayed there through the changeover in government and were there as part of the recovery until 1999, in fact rising to deputy minister of finance. They couldn't have blamed it on you, I guess. Am I right about that?

[Bill Jones]

Mr. Chair, a number of people did try to blame me for some of the actions that we took. However, it turned out that there was a lot of good work, and it turned around very well.

I can't say enough good things about Saskatchewan and the opportunity I had, and certainly the people of Saskatchewan. It was an outstanding opportunity for me.

[Jack Harris, NDP, St. John's East, NL]

I said it somewhat in jest. Obviously, your abilities were recognized as part of the solution, if I may put it that way. I am pleased to see that this experience in managing a difficult situation has come to the federal public service with you joining us.

Part of our effort here under the standing order is, as Mr. Norlock calls it, a job interview. It's about getting to know your abilities and skills, and asking a few questions about your new role.

Your appointment is called assistant deputy minister. What particular functions and roles will you be responsible for within the Department of National Defence?

[Bill Jones]

Mr. Chair, and through you to the member, thank you for the question.

In the position that I've been appointed to, I would put it very generally, the first priority is to work with and support the deputy minister in the overall management of the department. As I'm sure you know, the deputy minister is charged with the responsibility of being the chief accountability officer and so forth. Hopefully, my finance background will assist him in managing the department from that point of view.

Second, the deputy minister has indicated to me that he wants me to also focus on a number of key files. Those include, for example, procurement and those types of files. We have an extremely large procurement plan, as I'm sure you're aware. I will also be looking at some of the people issues in the department, given my experience at TBS, Treasury Board Secretariat, and my strong interest in that. It includes people issues such as pension benefits, the issue of mental illness, and so forth, both on the civilian side and the military side. These are areas that I very much want to get involved in.

[The Chair, Conservative, Peter Kent]

A very brief question, please.

[Jack Harris, NDP, St. John's East, NL]

It's a very complex department financially. It takes a long time to get to know how the financials of this department work. How quickly are you going to be able to be up to speed on that? How many other associate deputy ministers or assistant deputy ministers are there?

[Bill Jones]

Mr. Chair, and through you to the member, there is one associate deputy minister. I'm called senior associate deputy minister at that level. The act allows for up to three, I believe, but currently there is only one and I don't expect another one to be appointed. There are a number of assistant deputy ministers, if you like, below that.

[The Chair, Conservative, Peter Kent]

Thank you.

Your time is up, Mr. Harris.

Ms. Gallant, please.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Thank you, Mr. Chairman.

I'd like to ask the witness what he thinks the biggest challenges facing Canada, the Department of National Defence, and the Canadian Air Force, will be on the front line to be addressed in the coming years?.

[Bill Jones]

Mr. Chair, through you to the member, thank you for the question.

That's a tough question for what I'll say is a new person at the department.

Certainly from my short experience there I think a key issue for the department and for the Canadian Armed Forces is for us to be in a position whereby the defence team, as we call it, which is both the armed forces members as well as the civilians who support them, will be in a position of readiness to take on the missions that the government directs us to take on. That's a key issue. Also, as part of that we have to work very closely with our partners and allies. Obviously, the United States would be one, but there are other partners internationally.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Internally, what do you think the biggest challenges within DND will be?

[Bill Jones]

Mr. Chair, and to the member, again it's another good question.

I think there are certainly a number of challenges. I would answer that in two points. One is to ensure that we continue to communicate internally. That would be my responsibility and the deputy's responsibility as well as senior management as to the future direction of where we're going. We're in a process, as the member may know, of defence renewal and so forth. I think it's important that we make sure all members of the defence team are aware of that. Communicating that and moving forward with that is important.

The other one is to ensure that we move into a positive period of reinvestment. We've dealt with in a very substantial way budget constraints and so forth. Now we have to move towards building for the future. We always have to make sure that we manage money very carefully, but I think we want to build the armed forces of the future.

Those are two elements.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Is what you're saying that after DRAP, the deficit reduction action plan, and the other reductions, you're now going to re-target the money that has been saved?

[Bill Jones]

Mr. Chair, in terms of DRAP and the initiatives that have come before us, those were the Department of National Defence's contribution to deficit reduction, for which we wanted to pay our fair share. We wanted to be part of that, and we were very proud to do that.

Going forward, we have indicated that we need to be in a position of renewal—we call it defence renewal, and so forth—where we will continue to look for savings that we can reinvest into priorities for the department.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Okay.

Could you define for the committee what you feel would be a successful tenure during your time at DND?

[Bill Jones]

Mr. Chair, it's a tough question to answer in a short period of time. For me personally, I think a success would be that we fulfill our missions with the least possible risk to our members going forward. Furthermore, I think it is important that we continue to renew and position the armed forces and the civilian folks who work alongside them to provide for that readiness, that military capability for the future, which Canada needs, and dare I say, deserves.

[The Chair, Conservative, Peter Kent]

That's virtually your time. Thank you very much, Ms. Gallant.

Ms. Murray, please.