Government Operations Committee on March 29th, 2010

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

Thank you, Madam Chair.

Good afternoon, ladies. I am very glad to see you back before our committee.

Ms. Hassard, almost a year ago, to the day, you were here. It was at that time, I believe, that you took up your position. I kept the documents in which you told us that you were very sensitive the need to give the public service all the tools that it needs to work with a certain degree of comfort. You have a great deal of experience with people in the public service. Your presence here today is very important to me. I would like you to be aware of certain practices which, in my opinion, are not necessarily of the kind that you wanted to implement in the management of the public service.

Since 2006-2007, various clerks have been informing us about the strategic foundations of the renewal. Indeed, on March 31, 2009, Mr. Lynch told us that the implementation of some elements was expected, including the improvement of the infrastructures that help staff to do their work better. In your presentation, you said that you had launched the modernization of the remuneration system which has been in place for the past 40 years. It was absolutely necessary.

Now I have the following question: you launched this modernization, but are you going to carry it through at a time when budgets are being frozen?

[Patricia Hassard]

Ms. Meredith may want to help me on this one.

I think the way that would be looked at, in the current environment of an operating budget freeze, is that there will still be some priorities that will be funded from central resources. At least that's how I understand it.

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

Could you supply the committee with a document in which you will state, in writing, how you intend to continue modernizing the compensation system?

On reading certain documents, I gathered that deputy ministers were now responsible for personnel management. I must tell you that I am not comfortable with that. Not that I do not trust deputy ministers, but one year and a half or two years ago, when you implemented this new way of functioning, only about 30 deputy ministers from the ministries took part in the implementation of their human resource management plan.

Today, I want to know how many of them continued implementing the plan. Is everyone aware of the new directives regarding human resource management? Did Correctional Service Canada participate in this modernization of human resource management? Do we have access to the plans in the various ministries?

[Daphne Meredith]

Madam Chair, I would be happy to start in terms of the pay system question.

I would simply say that the government has committed to work on modernizing the pay system, as you've mentioned. It has dedicated resources to that. I would also say that there could well be the need for further resources as the project matures and it goes on to another stage. But the fact that the operating budgets of departments are frozen doesn't mean that they're completely static. There will be choices made within those budgets that can accommodate important reform initiatives of which this, I would suggest, is one.

In terms of the deputy ministers managing human resources and the concerns that you have, I'll certainly let my colleague Patricia Hassard speak to the tenure of deputies. I would simply say that my office is important,

because, at the head officer's office, we work together with departments and human resource managers in order to support them. We are always present even if we do not use the same tools to help them.

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

Did all the deputy ministers in the departments participate in the training? Did they integrate the famous plan that you wanted to put forward? Last year, there were about 30 of them. There are about 120 ministries and agencies.

[Daphne Meredith]

We have many means to support them. I think you would find in looking at the backgrounds of the deputy ministers who are leading departments that they have tremendous experience in managing people through their careers. That's partly what supports them in taking on the big jobs that they do. Also supporting them are their human resources organizations, in which you find the human resources professionals who know in detail, let's say, the considerable law affecting human resources management. There are about 12 statutes that affect HR management; it is an area where expertise is required. As well, there are central policies and other guidance that we use to support them.

So deputies themselves are experienced managers with long backgrounds in people management, but they're also supported by organizations of professionals who help them in exercising their duties.

[Patricia Hassard]

Would you mind if I added to that answer?

[The Chair, Liberal, Yasmin Ratansi]

You can finish, then.

[Patricia Hassard]

There are a number of accountability mechanisms to ensure that the deputy ministers community is responsive to the strategic direction that is set by the Clerk of the Privy Council as head of the public service. One of them is the annual performance management agreement and the whole process that goes along with it to assess whether or not they are putting an appropriate depth of attention to people management.

Also, for the last three years we have issued annual action plans, with specific commitments in them. Every year, deputies have reported to the Clerk of the Privy Council how they have done against those commitments. There is, in the annex of each of the clerk's annual reports, a scorecard that shows how well the deputies have done against those commitments. I think there are a number of publicly visible accountability mechanisms.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

We'll now go to Mr. Holder for eight minutes.

[Ed Holder, Conservative, London West, ON]

Thank you very much, Madam Chair.

I'd like to say at the outset, if I may, that I think Canada is honoured to have the amazing staff that serves this country. I want to give great kudos to the public service of Canada, and obviously to all of you with your responsibility. I think that needs to be said from this side, because too often the direction and the sense in what we hear involves a lot more negatives than positives. I can tell you, even from the standpoint of a member of Parliament, whereby at a constituent level I hear concerns from time to time at various levels, I hear a lot of positive things as well. I'd just like to share that with you and pass it forward to you.

Let me ask, Madam Meredith, when you were first appointed to your role.

[Daphne Meredith]

My first day of work was August 31, 2009.

[Ed Holder, Conservative, London West, ON]

Congratulations. We'll look forward to the anniversary party.

As my first question, I'm trying to understand why it took us this much time to put somebody into your role. I say this as a business person who had almost 200 employees. We had a human resources person in our office almost as soon as I became president of my firm, because even with that number of people, how else could you handle it? I'm thinking that 523,000 people is not a small number of people, and I'm sure you had very senior people.

But can you explain how this process came about? I need to understand it a little better.

[Daphne Meredith]

I can certainly explain it from my perspective. It would have been two or three years ago—Patricia would know the details of the timing—that the Prime Minister's advisory committee made a report suggesting that governance within the government on HR issues was overly complex. They made a recommendation in one of their annual reports to simplify it.

It is not an easy matter. You're dealing with six organizations and you want to make sure that any changes you make are on the right track. They did a thorough review of the organizations, made proposals as to changes that could be made, and as a result of those proposals—in March of last year, I believe it was—the machinery was changed to bring what was the Public Service Human Resources Management Agency of Canada together with the Treasury Board and to unify the function under a chief human resources officer.

It is not as if the functions weren't being fulfilled before. They were just being done in a different way. The view was that it was an overly complex arrangement that confused, in a sense, the roles of central agencies and made life more difficult for deputy ministers, who are really supposed to be able to manage their people in a commonsense, clear way.

[Ed Holder, Conservative, London West, ON]

Thank you.

I will have a couple of further questions, but first, Madam Hassard, you have indicated that we anticipate receiving the annual report to the Prime Minister very shortly; it will be tabled this week. Frankly, I look forward to receiving that report as well.

Comments earlier surprised me. A member opposite asked questions about documents from the PCO to cabinet and whether they were either available or could be shared. As you would know, all documents from PCO to cabinet are deemed confidential. So just to be clear on this—I'm sure my colleague actually knows that—this is just to put it on the record.

Madam Meredith, what I am concerned about is this. One of the things we were going to have today was a dialogue with a demographer, to give us a sense basically of the challenges in our population changes—baby boomers retiring and all. That didn't happen, for reasons of scheduling; it means we have a little more quality time with you.

If I have a concern, it's that from what I have read... There are a couple of things: first, that we have a retirement factor: it seems to occur much earlier in the public service of Canada than in the private sector. Are you aware of the details of this, and does it cause you any concern?

[Daphne Meredith]

Your understanding is the same as mine, that we are going through an elevated rate of attrition in the public service now relative to, say, five years ago. Now the rate of attrition is around 3.3%—certainly above 3%—whereas five years or so ago it would have been well below 2%, and if you were to look a decade in the past, the rate would have been an average of about 1.5%.

So we have hit an accelerated rate of attrition, one that is likely to come down post-2013-14. I understand that this is a little in advance of when the private sector is likely to hit its high attrition level.

[Ed Holder, Conservative, London West, ON]

Could I ask you what has been causing that accelerated rate of attrition in the public service?

[Daphne Meredith]

It's really the demographics of our workforce and of hiring of baby boomers starting back in the early 1980s. It's numerical, I think. In general, the public service has a relatively low rate of attrition through avenues other than retirement, and so our attrition is largely driven by retirement and therefore really driven by the age of our workforce. If we were to look at the age of our workforce and its statistical profile, you'd find it, over the last two decades, going from being relatively weighted on the younger side towards being relatively weighted on the older side, and those are the people who are now eligible for retirement.

[Ed Holder, Conservative, London West, ON]

My research would suggest the very same thing in terms of an older workforce.

Do you have any sense of the mobility issues relating to the public service of Canada? My sense, and I must tell you it's anecdotal at this point, is that public service of Canada employees tend to stay longer than members of private firms. Do you have any feel for that, or anything beyond an anecdotal sense?

[Daphne Meredith]

My impression would be that they do, because, as I mentioned, the rate of attrition for factors other than retirement is very low.

[Ed Holder, Conservative, London West, ON]

Have you done any comparisons between,say, the pension plans associated with the public service against those of the private sector?

[Daphne Meredith]

We've done some work. It's not completed. Clearly, with the focus on pensions and comparability, we are looking at other organizations and trying to get a view as to how we're benchmarked in terms of pension and benefits generally.

[Ed Holder, Conservative, London West, ON]

Would your sense of pension and benefits, again from a subjective sense, suggest to you that those types of benefits and pensions are stronger in the public service than they are in the private sector?

[Daphne Meredith]

I think the fact that we have a defined benefit pension puts us in a leading group--comparable to other governments...but yes.

[The Chair, Liberal, Yasmin Ratansi]

Thank you very much.

We now go to Mr. Julian for eight minutes.