Finance Committee on Dec. 7th, 2006

[Connie Roveto]

First of all, I think one of the things I'd like to say, Mr. Chairman, is that there is a line between governance and management. The board of management is very much involved with ensuring that the organization has the appropriate policies and procedures and strategies to do its job effectively, in a very accountable and transparent way.

Given that, I think one of the statements the minister made was that this is going to be phased in over time. Given that time horizon, there is the opportunity to find jobs for these people who might be displaced. One of the things the board is looking at in terms of the footprint of the organization is to push more out of the Ottawa region, so that any new opportunities are placed closer to the taxpayers and the clients, to the degree that it is economically possible. That's because it is always a balancing act between the cost to the taxpayer and also the services to the taxpayer.

The other thing that was in one of our annual reports was that like other government departments, the Canada Revenue Agency will be facing a lot of retirements over the next few years. About 17.5% of employees are eligible for retirement in 2007. That doesn't mean they will retire in 2007, but they are eligible for retirement. I'm sure some of them are in P.E.I. as well.

Given the time horizon, I am sure management will do everything possible to retain the employment of the people in Summerside.

[Joe McGuire, Liberal, Egmont, PE]

According to the union, there are only five positions over the next two years that will see people retiring or eligible for retirement. Basically, there may not be any kind of number there at all who are leaving.

If they are going to be taken care of inside the agency—I understand that's how it has to happen, because they are not eligible for bumping into DVA or anyplace else—this has to happen basically in Summerside or in the small office in Charlottetown. The chances of that are very slim, unless, as you say, they pull something out of the national capital region and take it to the other regions of the country. Am I right or wrong in saying that this is probably the way it would happen?

[Connie Roveto]

Or growth. There has to be growth of business of some kind.

Michel, can you be more specific?

[Michel Dorais]

I just want to remind the committee that the minister said the agency would make best efforts. It's important that the committee realize that the CRA is an organization that has 44,000 employees in 55 locations across the country. Every day, there are jobs that are eliminated and jobs that are created.

We just created a secretariat for the softwood agreement that has been reached. It's out of Surrey, in the Vancouver area. Tomorrow, if there is a new program that the government or any provincial government we serve creates, we may put it in one place or the other, in the most effective and most efficient place to put it.

There is a very dedicated group of employees in Summerside, like in any other tax centre. Obviously, if the agency could put some new business in Summerside to find employment for the employees over a certain number of years, we'll certainly do it, with pleasure, because it's a very productive office. But we cannot give an absolute guarantee at this point.

[Joe McGuire, Liberal, Egmont, PE]

Mr. Chair, I was just going by Minister MacKay's words. He's the minister responsible politically for Prince Edward Island at the present moment. He has given his word that there will be no job losses. He basically accused me of grandstanding because I said there would be, so I'm taking him at his word. He says there are going to be no job losses, and we're going to hold him to that.

The only way to hold him to that is for you people to come through with a plan to make sure there are no job losses. That's all I'm getting at here. I'm just going by the minister's words. I'm not making this up.

[The Chair, Conservative, Brian Pallister]

Thank you, sir.

I have just a couple of very specific questions. In response to the increasing challenges, if we believe the AG's report about the underground economy and revenue leakage therein, I know the department targeted certain aspects or certain sectors of the economy, such as the construction industry, some years ago and so on. My questions have absolutely nothing to do with that.

[Voices]

Oh, oh!

[The Chair, Conservative, Brian Pallister]

I understand from that activity, therefore, that the agency has the ability to target certain sectors of the economy for special attention in terms of collecting taxes. Whose bright idea was it to go after competitive curlers?

[Michel Dorais]

Competitive what?

[The Chair, Conservative, Brian Pallister]

Competitive curlers. Who's going to take responsibility for that one?

[Connie Roveto]

I didn't know there were competitive curlers.

[Voices]

Oh, oh!

[The Chair, Conservative, Brian Pallister]

Not here, but there are.

About a year ago there was a news item about going after a particular curler. I know you can't talk about particular cases, but Wayne Middaugh is a friend of mine.

There is a World Curling Tour. In any given winter there might be perhaps a few dozen curlers who make more than it costs them to curl, and several thousand pay more than they get. Because I've heard nothing about this over the last year, and neither have some of the curlers involved, I'm curious about where this initiative is at. Is there any program under way, or has this misguided attempt to try to rake in some revenue, which is minuscule relative to the cost of raking it in, been dropped?

[Michel Dorais]

I assume, Mr. Chair, you're referring to the taxation of gains from professional sports. With respect, Mr. Chairman, I think Parliament has asked us to tax those.

[The Chair, Conservative, Brian Pallister]

Yes, so I'm asking if you've dropped the idea for curlers. If you start taxing it for some of the curlers, you're going to find that you're going to be allowing write-offs for hundreds and hundreds of curlers. The cost of overseeing this kind of a program is going to far outweigh the advantages, in my estimation, so I'm asking you where it's at.

[Michel Dorais]

Mr. Chair, I don't have the answer with me, and my colleague doesn't either, so I will undertake to get back to you, if that's all right.

[The Chair, Conservative, Brian Pallister]

It's always all right, and I appreciate you doing that. I certainly urge you to do that. Thank you.

We'll continue now with Pierre Paquette.

Encore, monsieur.

[Pierre Paquette, Bloc, Joliette, QC]

Mr. Chairman, we have already raised the issue of the aging employees at the Agency. The Agency is a separate employer. Is there a specific human resources policy? What features distinguish this policy from the general federal public service policy? Does the Agency, like the Quebec nation, have distinctive features? I would like you to speak to us about this aspect of your mission. Does the board have a role to play?

[Connie Roveto]

Mr. Chairman, I think one of the board's strongest activities since its inception has been in the whole area of human resources management. There has been a great modernization of the human resources practice within the agency. The agency has instituted a recruitment, selection, and promotion process based on sets of common competencies. It has also developed an open dispute resolution process for employees. We have instituted a new job classification system that has also streamlined areas, and there was a lot of liaison with the unions there in terms of achieving effectiveness.

We've increased employee satisfaction, and there was a significant reduction in the number of unions. At its inception, I believe there were something like 23 unions that the agency negotiated with. I believe there are now two. There might be a third small one, but there are two main unions that we negotiate with.

At the executive levels, there have been significant changes in terms of the role of the board of management in the governance of the executives of the organization. For example, the board of management establishes objectives for the CEO or the commissioner every year. At the end of the year, we also measure performance against those objectives that have been set for the commissioner. For all of the “C” jobs, if you like—CEO, COO, CFO, and the director of internal audit—their performance reviews are reviewed by the appropriate committee, be it the audit committee or the human resources committee of the board.

I think these have been very positive developments in terms of the human resources management process. As I mentioned, the board of management has a human resources committee that works very effectively with management in this area.

There's another thing that the board of management has done in the past twelve months. We have asked to be involved in developments at the early end, rather than having management present us with final solutions for approval. That allows a much broader discussion and direction to management, and it also encourages them to look at other alternatives in terms of the development of their plans.

So, particularly in the area of human resources, there have been a lot of positive developments under the agency model.

[Pierre Paquette, Bloc, Joliette, QC]

The following aspect may have been mentioned, but I did not hear it. Is it the Agency's Board of Management that hires the commissioner? Is the commissioner appointed by the government? Do you make recommendations? If there was discussion of it earlier, I missed it.

[Connie Roveto]

This is another item in the stage of evolution. The CEO of the agency is a deputy minister. It is the Prime Minister and the Clerk of the Privy Council who are involved with the appointment. We're starting to work more closely with the Privy Council Office. The board has outlined job and experience specifications for anyone who fills the role of the commissioner and the deputy commissioner. This is an area that is evolving.

I'd have to say that I don't know anyone in the private sector who serves as many masters as the commissioner of the Canada Revenue Agency. They are accountable to the board, the minister, the Prime Minister, and the Clerk of the Privy Council. Luckily, Michel is quite capable of dealing with all those masters.

[The Chair, Conservative, Brian Pallister]

Thank you very much for your comments. We will now continue with Mr. Dykstra.

Four minutes, sir.

[Rick Dykstra, Conservative, St. Catharines, ON]

All right. Thank you, Mr. Chair.

I'll go quickly. One of the first questions I have--and I smiled a bit when I saw this--relates to page 6 of your report, where it states in the last sentence of the second paragraph that, “All members are financially literate and are independent of Agency management”. I just want to make sure that doesn't suggest they are illiterate in any other way.

[Voices]

Oh, oh!

[Connie Roveto]

Mr. Chairman, I have to say, from the day I joined I've been impressed with the quality of individuals we have on the board of directors--their experience, their contribution to the board, and their dedication. In our recent annual report, there is a page that shows board attendance at all committee meetings, etc. I'm very pleased with the quality of the board that governs the agency.