Government Operations Committee on March 29th, 2007

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

I thank you very kindly for your comments today, but to me the purpose of this committee was to come up with some answers regarding the demographic problems of aging in the workforce.

Granted, there are a number of serious, valid concerns--equity, fairness, working conditions, or whatever--and to me they might all be, and probably are, valid. There's validity in them all, but our concern as a committee and my concern as a committee member with the mandate of this committee is to clearly establish whether or not we have a demographic time bomb on our hands with regard to having the capacity to staff. We can argue working conditions, we can argue salaries, we can argue whatever between private sector and public sector or whatever, but we need to know whether or not we have the capacity to handle it within the public service now--the capacity to attain or to retain. What are your thoughts on that?

[Gary Corbett]

Well, they're all connected. As much as you want to try to separate them out, they're connected. If you create a workplace that attracts the best and brightest to deliver for Canadians, but you're not providing resources or you don't have interesting equipment to work on because it's not been updated in the last ten years, they won't stay. They're going to leave. That's part of the problem. It is really connected.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

Just to play devil's advocate for a second, I'll say life is generally not a one-way street but a two-way street. I have worked in the public sector and in the private sector, both as an employee and as an employer. You find many people who are tremendously satisfied with their jobs in both areas, and in both areas you find a significant number of people as well who will never be satisfied and aren't satisfied in their particular vocation.

At some particular point, there is that reality, so we also have to deal with that. Perhaps the one weakness might only be a perceived weakness on my part, and I could be in error here, but maybe one advantage the private sector has over the public sector at this particular point is that in the public sector, there really doesn't appear to be the latitude for carrot and stick, for serious incentives for tremendous performance at work, as well as for having a potential punitive and/or negative effect if the performance isn't there. There is so much protection built in--and I'm not suggesting protection isn't wanted or warranted or needed--whereas in the private sector there appears to be a bit more opportunity for a faster response to changing circumstances, whether it's for salary increases without having to go through an entire budgetary approval and a change of government or whatever. Does that give them an inherent advantage? Do we need more flexibility within the public service to be able to meet these quick changes?

[Gary Corbett]

That's a very good question, but to compare the public sector with the private sector is really apples and oranges. They do different types of work. The private sector really is about making money; the public sector is about providing public good. You can hire somebody who wants to work for the public service and is dedicated to the public good. It feels like they're delivering for Canadians. Sure, they can be attracted away by the money and the flexibilities offered in the private system, but they're different jobs. They're different roles. I think that has to be looked at too.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

I don't accept that premise totally. There are many people in the private sector. Obviously if there is a corporate involvement, the bottom line is of course crucial to shareholders, perhaps, and ownership, but there are many hundreds of thousands of employees, or millions, who take a great deal of satisfaction from a job well done in addition to the remuneration.

Here is a thought, then. Has your organization done any comparative studies or evaluations relative to other jurisdictions, other countries? How do we compare in retention, and do they face the same potential demographic problems in Australia, New Zealand, Germany, or Switzerland? Do you have any idea where we stand in comparison to global problems? Are they similar? Are we all a little lighthouse here? How are we doing? What are your thoughts on that?

[Denise Doherty-Delorme]

The reason we brought up some of the statistics from the United States is that they're facing the same problem we are. They're actively recruiting mid-level managers, and they're actively recruiting scientists.

To go back to what Mr. Corbett said before, they spend a lot more money on doing science. You may even have seen, when you're watching TV, that they have ads now on television trying to recruit patent examiners. They're actually doing that. Those ads are now playing in Canada, so we're losing some of our best and brightest to the United States, because they're spending money.

If you go to page 4 of our brief, you'll see the graph. The first question is whether we have a looming problem. The answer is yes, we do. If you look at the graph, you'll see that in the public sector--and this was back in 2004--those 45 and older represent 52% of the core public administration compared to the labour force, which is much, much younger. Compared to the labour force as a whole, the federal public sector has a much greater problem. As Gary mentioned in his presentation, the private sector is already doing things to retain its older workers, to attract younger workers, and to have that knowledge gap filled, and it is bringing in mentoring.

We don't see that in the federal public sector. The problem is greater here, and we see less of a strategy and fewer mechanisms toward dealing with that issue.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

Do I have time for another question?

[The Chair, Liberal, Diane Marleau]

A very short one.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

Just very briefly, then, whenever there's a major problem, it's not a single major problem, it's always an accumulation of many, and the solutions probably will come along in a comparative way. It might not be a question of just more money, or just more apprenticeship, or just better working conditions. It's going to take quite a step-by-step approach to fix this.

I really thank you for your insight on this and your contribution to the committee. It certainly gives us a balanced approach from which to look at this.

Thank you.

[The Chair, Liberal, Diane Marleau]

Thank you.

We'll go to Mr. Dewar.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you, Chair. And thank you to our witnesses for being here today and providing an articulate overview of the issue.

I want to go back to the comments I made to the witnesses from PSAC about the whole issue of temporary workers. I know in terms of your membership--I mentioned in my comments, and I believe you were present--that temporary workers are now being used for jobs that aren't just administrative. Most of us--I certainly--would have believed that the federal government relied on temporary agencies to fill in the gaps, as it says in the standing offers, when people are sick or there's a change in dimensions within the public service and there's some catch-up needed. I mentioned and underlined the passport crisis we're now facing. We wish they'd hire more temporary services to help out there.

That said, I'm noting here, on the order paper data that I got back, that we're talking about.... I'll just break it down for you and the committee. The top five departmental users of temporary services since 2001 are the following: Health Canada, National Defence, Public Works, Industry, and Environment Canada. I assume you have many members in each of these departments.

I have a question for you. It probably isn't a surprise to you, but it was a surprise to me. When you talk about the issue of retention and the fact that we have a demographic shift, and the boom, bust, and echo thesis, which we've all probably heard about, it seems pretty simple that if you're going to retain people, you don't make temporary services your outpost for the public service. You actually make sure that your public service is in charge of that. When 45,000 jobs were shed in this town in 1995 as a result of the budget cutbacks, we thought we'd built up capacity again, and here we are looking at runaway costs for temporary services.

I want your comments on your concerns about temporary hires and the fact that we have epidemiologists, pharmacists, long-term professional jobs that require credentials and a lot of education being outsourced, if you will, and we are hiring temporary firms to do this hiring. I'd like your concerns on that and on some of the issues it raises in terms of retaining people and dealing with this gap that we're going to be confronted with.

[Gary Corbett]

For us the problem is chronic. We started looking at this a long time ago. I appreciate your data and I think it's absolutely correct. There are other examples we could point to. The question is, why are departments afraid to make the commitment to hire somebody long-term? It has to do with the amount of stability they believe the system has in it for them. There have been cutbacks since program review, and even last year they brought up expenditure review. Departments are not willing to commit to pay long-term for a person because they want the flexibility so they can meet the budgetary requirements demanded of them by the system.

That's really what's going on. So they hire term and casual workers. They bring in post-docs around the system who are there for seven, eight, and nine years and are not classed as public servants. They bring in guest workers. These are chronic problems. It's because of a lack of commitment on the government's part to R and D, for example, or S and T in that particular example. That's our view of it.

[Paul Dewar, NDP, Ottawa Centre, ON]

I just want to point out two firms that receive the most money from government. Since 2001, one has received $96 million from the federal government for temporary services. Another, which is an adjunct of this company, has received $23 million since 2005.

It seems to me we almost have these satellite public services that exist outside of the formal public service. When we look at the dilemma here and how to retain people, value for money is something as well. Hopefully the budgetary officer, who as part of Bill C-2 will overlook spending--not after it's spent, which is the Auditor General's job, but before--will take a look at this. The value-for-money argument is one that I don't think has been addressed.

Before the Christmas holidays I had three town halls on foreign credentials and the labour market with members who are newcomers to our country. There were engineers, doctors, people from right across the professional gambit, and they all want to work. They're all qualified, but they can't get into the public service. I submit to this committee that when 35,200 college and university graduates applied for jobs last year--as was submitted by Ms. Barrados--and only 550 were hired, and half of them were for term positions, I think it's pretty obvious what the problem is. There's no room at the inn.

There are plenty of qualified people. Granted, we have a crisis down the road if you look at ages, but we are dealing with the here and now. The here and now for me is that we need to hire people, commit to people, and commit to people who are newcomers, because we know that's 100% where we'll get our new employees from. When I hear from the public sector unions that they're having problems in terms of retention, we only have to look as far as the budgets and the amount of money we're spending on temporary hires. What kind of commitment is that? I think that's sending a message to people that “We want you, but only for a week. See you later.”

My last question is on protection of your pensions. I know there's some court action with others to make sure the moneys that are there for your pensions in the long term will be vested, and people can be assured that when they retire their pensions will be there for them. You mention your concern that many professionals cannot fully benefit because of mid-career entry or late starting age into the public service. I know that in other professions in other sectors that's a problem. Do you have some ideas on how that can be addressed?

[Gary Corbett]

I really don't. I know that when people enter the public service at a later age they have fewer years to bank on. They have to stay around longer in order to have pensions they can retire on. I don't know how that can be addressed.

I will say our membership is willing to work with the government on any ideas to try to sort out where we can be of assistance.

[Denise Doherty-Delorme]

If I could just add to that, those members hired by the federal government, who work in the professional areas, come in with master's and PhDs. If they had been hired by the federal government when they had bachelor's degrees and then went back for training and education, those years of service would have counted. Because they do it before entering, those years don't count. We think those people hired with master's and PhDs should be compensated. We have issues around their low starting salaries, issues that when they come in they'll have less vacation than someone with a high school diploma who's been there since the age of 18, but also with the pension. They should be credited in some way for the years they spent getting themselves ready to give service to the public.

[The Chair, Liberal, Diane Marleau]

Mr. Pacetti.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Thank you, Madam Chair.

Just to continue on that line, you want to compensate somebody when they're not employed, for having a higher education, for going into a job where they're already getting paid more for having received more education?

[Denise Doherty-Delorme]

In one word, yes. To give a rationale to that, during that whole period of time there's an opportunity cost to going to university, especially for master's and PhDs. These people are graduating with $90,000 to $120,000 worth of student debt. During the time they are studying, they cannot work in another capacity. They may be lab assistants or teaching assistants and they get paid very little. They may get an NSERC...tops, they may get $17,000 a year. They are graduating with a PhD, on average at the age of 36. Compared to someone who left after high school and started working with the federal public service, and the time they can give to the public service before they would like to retire--but the earliest they could retire is 61 or 63 because of the penalties involved--the service they give to the public is not in any way—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

No, I understand the logic. I don't mean to interrupt you, but time is limited. A person who has graduated with a PhD or a master's is not going to make the same salary as somebody who graduated with a bachelor's degree or a high school diploma. So that person is going to be compensated with the salary level, or are you telling me that's not the case?

[Denise Doherty-Delorme]

We've done the math on what kind of pension they'd receive. If they took their pension and retired at the same age as someone who came in after high school, they would be severely negatively affected by the pension.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Yes. That's like collecting your CPP early or not. If you collect it at 60 or 65, do you go to work or not go to work?

If you have those charts, I think the committee would be interested in seeing them. You could send them through the clerk. That's pretty interesting.

That leads to one of my other questions, on the hiring age. In your brief you were saying that people were getting into the public service at a higher age, but I think that's an overall assessment. I don't think it's just in the public service. But aren't they retiring at a much older age as well, so they're still putting in 30, 40 years of service?

[Gary Corbett]

It's not our experience. They're coming in at a higher age. In terms of the professional qualifications, in the professional categories, they spend longer before receiving their degrees, then they're entering the professional designations. It's not necessarily.... There are the baby boomers, who have been—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Sorry to interrupt, but you haven't seen it yet because it's only going to happen in 10 years. The shift is going on now. It didn't happen in the 1960s or the 1970s. You have the baby boomers retiring now, so shouldn't we be waiting to see? Most of the people who have been hired in the last 10 years will last a good 30 years, won't they? I hate to use the expression “last”, but they'll be working productively for the next 30 or 40 years.

[Gary Corbett]

I'd like to know how many were hired in the last 10 years in the professional categories.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

So that's where the problem is, in terms of—