Government Operations Committee on Feb. 26th, 2013

[Mathieu Ravignat, NDP, Pontiac, QC]

Could you tell me what specifically that money will be used for? What activities will it cover?

What level of public service managers are we talking about here? Are they EXs?

[Christine Walker]

These would be non-EX positions. These are managers in the public service. It really is to hold workshops and training sessions. As I said, I believe last year there were over 12,000 workshops and training sessions held for the National Managers' Community.

[Mathieu Ravignat, NDP, Pontiac, QC]

I gather, then, it's an organization that offers group therapy to managers in tough situations because they have to let go of employees they need, and that in turn has an impact on services provided to Canadians.

[Sally Thornton]

Actually I participated in several of these sessions, so I can answer your first question. They do have sessions where you learn how to have difficult conversations, which were very much relevant in the context of the deficit reduction and spending review. They weren't so much therapy as learning specific tools on performance management and measurement, really concrete things that we could take back to the office and apply.

[Mathieu Ravignat, NDP, Pontiac, QC]

You aren't responsible for this situation. It stems from the way Treasury Board and this government chose to approach the public service cuts. Their choices made these workshops and group therapy sessions necessary. It's utter chaos in the public service today. I support the public service, but it's shameful this money is even necessary.

[Sally Thornton]

They have a wonderful website that articulates all of the different training and sessions that they offer. It covers a wide range of tools that are relevant for managers in whatever context.

[Mathieu Ravignat, NDP, Pontiac, QC]

I would think it's mostly relevant in crisis situations.

[Christine Walker]

It's really important to note that this community was established in the year 2000, so it has not just been established recently.

[Mathieu Ravignat, NDP, Pontiac, QC]

Very well.

[The Chair, NDP, Pat Martin]

You have one minute.

[Mathieu Ravignat, NDP, Pontiac, QC]

Could you give me a report of the effects the public service cuts have had on services provided to Canadians? Could you give me an overview?

[Bill Matthews]

I can report, Mr. Chair, that the strategic and operating review, or the deficit reduction action plan, by the 2012 measures, totals $5.2 billion in savings over the three years. Of those reductions, 70% were around operating efficiencies, so the majority were targeting operating efficiencies, backroom-type things, as opposed to impacting services to Canadians. In the three-year program of reduction, we're about to start year two. Year one is just coming to a close, so the chapter in terms of managing reductions is not yet closed but is ongoing.

Many of the departments actually have service standards. We've spent some time talking about human resource development today. They do have service standards and they publish regularly how they're doing. I would suggest maybe to keep an eye on those. I don't have anything specific to say about services to Canadians and impacts other than we're on track for the 70% around operating efficiencies.

[Mathieu Ravignat, NDP, Pontiac, QC]

Very well. Thank you.

[The Chair, NDP, Pat Martin]

I'm afraid we don't have any more time to answer anyway.

We'll move to Ron Cannan.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Thank you, Mr. Chair.

Thanks to our witnesses.

I'll just say I'm proud to be part of a government that's showing leadership to reform government and that's taking the necessary steps to provide fiscal responsibility in these challenging global economic times. I appreciate the information and the opportunity to clarify a couple of questions.

One question of concern looked at by last year's committee as well is the writeoffs of the student loans. We're looking at $231 million, I believe, for over 44,000 students. Could you enlighten the committee on how this compares? Last year it was about $312 million, if I recall, in 2011-12 for about 98,000 accounts that we had to write off. I think they dated back about a decade. Could you provide the details on the uncollected loans as well as writeoff versus forgiveness?

[Bill Matthews]

There are a couple of comments I'd make. The student loan program is a big program, so if you were actually to look at the government's balance sheet, you'd see about $14 billion in accounts receivable related to student loans.

When you're issuing that volume of loans, you are going to have some writeoffs. No one likes writeoffs, but I would say that if there are years where you don't see writeoffs, it's actually a bad sign. Departments should be coming forward and cleaning up their books on a regular basis. This is an annual event. Since CRA has taken over collection of the loans, we have seen an improvement. The default rate has dropped by about half. You are going to see this as an annual event, because departments do need to go and clean up their books. These are writeoffs, not forgiveness. In many cases the six-year time period has expired, so we do write them off.

That does not mean the debt is forgiven. Many of these people have left the country or potentially even passed away. If they do come back into the system for some reason, if they've left the country and have come back, writing off the debt does not stop us from collecting in the future. It is a bookkeeping event, and we should be doing it on a regular basis. That's what's being done here.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

The statutory limitations are set by...?

[Bill Matthews]

By regulation, if I recall correctly, and it's six years. You will see this as an annual event from this department.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

I think we're running around the high 80% in student loans being paid back. Do you know what the number is?

[Sally Thornton]

The default is less than 14%.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

So It's 86% or 87%. Excellent. Thank you for that clarification.

Moving on to High Commissioner Gordon Campbell's amalgamation of the high commission and foreign affairs in London, my understanding is that the consolidation of the building is about $100 million or so, and then the ancillary. Then the existing building is going to be sold. What happens when that asset is sold? How is that accounting shown in the books?

[Bill Matthews]

The way to view this, Mr. Chair, is as bridge financing. When that building is sold, the department doesn't get to keep it. It comes back into the consolidated revenue fund, and it essentially pays this back. Those proceeds from the sale are expected to be more than enough to offset the cost to acquire this new property as well as whatever fit-up they need to do to make it one building. It's Canada House and Macdonald House that are being combined. Macdonald House, if I recall correctly, is being sold, and the property next to Canada House will then be used to make one grouping of our employees over at that building.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

It makes good sense. Thank you.

Just looking at all the organizations listed in supplementary estimates (C), I think there are 49. Is that correct?

[Bill Matthews]

Yes, I believe so.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

There are more organizations that aren't listed. Is there a reason for that?