Government Operations Committee on March 20th, 2018

[The Vice-Chair, Liberal, Yasmin Ratansi]

Committee members, I will call this meeting to order.

Welcome, Minister Qualtrough and the other people from Public Services and Procurement Canada.

We are today looking at supplementary estimates (C) and interim estimates. We have the first panel, Minister Qualtrough and her staff, from 11 a.m. to 12 p.m. Shared Services Canada is here as well. For the second panel we will have officials remaining from 12 p.m. to 12:45 p.m, and we'll need 15 minutes for committee business.

With that, Minister Qualtrough, the floor is yours.

[Carla Qualtrough, Liberal, Minister of Public Services and Procurement]

Thank you very much, Madam Chair.

Good morning, everyone.

Thank you for the opportunity to appear before you to discuss the 2017-18 supplementary estimates (C) for Public Services and Procurement Canada, as well as Shared Services Canada. I will also take the opportunity today to highlight the funds that were recently announced in budget 2018.

Joining me today from PSPC are Marie Lemay, deputy minister; Les Linklater, associate deputy minister; Michael Vandergrift, associate deputy minister; and Marty Muldoon, chief financial officer. From SSC we have Sarah Paquet, executive vice-president, and Alain Duplantie, senior assistant deputy minister and chief financial officer.

We are all here to answer your questions.

As committee members know, both departments play important roles in the daily operations of the Government of Canada, delivering high-quality, client-focused services to other federal departments and to Canadians. In these supplementary estimates (C), Public Services and Procurement Canada is seeking an additional $228 million in support of its operations. Of the amount sought, $152 million is for ongoing measures to help stabilize the Phoenix pay system and pay centre service delivery.

I've said it before, and I'll say it again, it's completely unacceptable that our hard-working public servants are not being paid properly. Every day I hear stories of hardships, of anxiety, of stress caused by the failings of our pay system. I hear from and speak regularly with affected public servants from across the country, I read their stories in the news, and I hear regularly from unions about the personal toll this is taking. I hear about the family who had a hard time making ends meeting during maternity leave or the parent who had to tighten his belt during the holidays to buy gifts for his kids. These stories, Madam Chair, are heartbreaking. That is why much of this funding is directed toward services that will enhance support to the public servants experiencing pay problems.

Since Phoenix was launched, we have more than doubled the number of compensation advisers. We will also soon have a hundred more people at our client contact centre, who will be able to provide more detailed information to employees who are calling about pay problems. Currently we are looking at how work is organized so that transactions can be handled more efficiently. At the pay centre we are piloting a new approach that organizes compensation experts and support staff into pods that specialize in specific departments or transaction types, and early results are promising.

We are also investing in technology and improving our systems and processes, with a particular focus on better connecting Phoenix to a patchwork of over 30 government human resource centres.

All this work is being led by an integrated team of senior officials who are taking a whole-of-government approach to stabilizing the pay system. Fixing Phoenix and ending the hardship it imposes on public servants across the government remains my number one priority.

This brings me to my most recent initiative in an effort to further support MPs' and senators' offices in assisting constituents experiencing pay issues. I understand that every MP was emailed this flow chart yesterday, which is entitled “Assisting constituents with pay issues”, a need that was clearly expressed when I last appeared in front of this committee. Yesterday, additional information was sent to MPs and senators providing instructions on how to manage and send constituent pay issues to the appropriate contact. It is important to note that pay issues that are reported, whether through the office of an MP or senator, unions, departments, web forums, or the call centre are assessed by the pay centre. This builds on existing internal processes, and immediate efforts will be made to resolve issues that have the greatest financial impact on an employee.

Madam Chair, when I last met with your committee in late November, we had the opportunity to discuss the full suite of measures designed to bring the pay system to a point of stability, and in the short term reduce wait times and late transactions. Our government is committed to doing whatever it takes to fix this situation, but as I've said, there is no easy or quick fix. We didn't create this problem, but it is ours to fix, and budget 2018 supports our commitment to stabilizing Phoenix and paying our public servants accurately and on time.

To ensure openness and transparency of ongoing costs related to Phoenix, members of this committee have received a document that clearly summarizes the previous government's expenditures and unrealized savings, as well as the funds our government is investing to stabilize the pay system. That's the document that was distributed this morning entitled “Investments in Phoenix”.

As announced on February 27, budget 2018 proposes investments of $431 million to continue making progress on Phoenix issues, including hiring additional staff to support the pay system.

This funding will be largely used to increase capacity, in effect allowing us to bring the number of employees working on pay issues at the pay centre and satellite offices to more than 1,500. This capacity is filling a critical gap that was created when the former government eliminated the jobs of more than 700 compensation experts before launching Phoenix. The impact of this cut has been felt across government, and so additional HR advisers will also be hired within departments to assist employees with payroll issues.

Our immediate goal is to stabilize the pay system to ensure that pay is being provided accurately and on time; however, at the same time we must also focus on a longer-term solution, one that makes better use of modern technology and provides a reliable and efficient pay system for public servants.

That's why budget 2018 proposes to invest an additional $16 million in new funding for the Treasury Board of Canada to work with experts, federal public sector unions, and technology providers on a way forward for a new pay system. Our government is also funding the Canada Revenue Agency—$5.5 million over two years—for processing federal government employees' individual income tax reassessments that are required because of pay issues and for handling inquiries.

Budget 2018 also provides funding for other priorities, including procurement modernization. I would be pleased to return to this committee to discuss our plans and priorities once the main estimates and departmental plans have been tabled.

Turning now to other areas of our mandate, the supplementary estimates (C) for Public Services and Procurement also include some amounts.

It provides $7.9 million to help us better deliver service to pensioners, and $6.9 million to ensure that Parliamentarians and Canadians continue to be served in the official language of choice.

It includes $3.6 million resulting from the disposal of several surplus properties in Quebec and Ontario, which is to be reinvested toward the maintenance of federal buildings.

It provides $12 million in funding to provide accommodation, procurement, interpretation and project management support for the upcoming G7 Summit in the Charlevoix region of Quebec.

An amount of $2.3 million is also provided to improve our contracting processes, provide clarity to businesses, and ensure that federal procurement remains fair and transparent.

An amount of $2.5 million is provided to continue to support online advertising by the government, and $1.1 million to undertake the project definition phase of the West Memorial Building Rehabilitation Project.

I shall turn now to Shared Services Canada.

Through supplementary estimates (C), Shared Services Canada is seeking $24.8 million in additional funding. This includes investments of $16.2 million to support this year's G7 summit. The department is providing information technology-related services to fit up an operations office and regional summit offices. This is in addition to the ongoing work SSC is doing for the G7 to install new cellular towers and upgrade existing towers, as announced last December. While these improvements will enhance summit operations, they will remain of permanent benefit to area residents and businesses.

Shared Services Canada's supplementary estimates (C) also include $3.9 million to support new full-time employees in the government by providing a standard suite of such services as workplace devices, Internet access, and file storage; and $4.0 million in total net transfers from other departments, which will be used for various information technology projects and services.

In budget 2018, significant new funding is proposed for SSC. About $2 billion will be invested over six years to build a modern, secure, and reliable information technology platform for the digital delivery of programs and services for Canadians. This investment will help reset and reinforce core IT services for the Government of Canada.

The budget also provides an additional $110 million over six years to the Treasury Board Secretariat, starting in 2018-19, to be accessed by SSC's customer departments and agencies to help migrate their applications to secure, modern data centres or cloud solutions.

Madam Chair, I am reminded daily of the important work under way in both departments as part of their commitment to excel in government operations and deliver high-quality programs and services that meet the needs of federal institutions and expectations of Canadians.

I want to thank our hard-working employees who bring great dedication to all their tasks.

Thank you, Madam Chair.

We look forward to your questions.

[The Vice-Chair, Liberal, Yasmin Ratansi]

Thank you very much.

We now go to the first round of questions with Mr. Ayoub.

You have seven minutes, please.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Thank you, Madam Chair.

Thank you for being here, Madam Minister.

As always, you are painting the picture of a complex system that challenges us on a daily basis.

In your presentation, you talked about Phoenix. Could you tell us a little more about the plan and results you are hoping to obtain. How can we improve the situation? I am fully aware that people are working very hard to do so, but could you elaborate on what will happen? Phoenix was implemented, but what will happen in the near future?

I would also like you to tell us about the online follow-up of the progress made. We are at a stage where we always want to be transparent and set the record straight. That's what you are doing, but could you make it even clearer for the benefit of Canadians who are listening.

[Carla Qualtrough, Liberal, Delta, BC]

Thank you for your question.

Frankly, it's a very difficult issue that we will not be resolving quickly.

To be honest, this is a very complex file. While we are seeing progress, it is taking time, and it is costing money. In a number of different areas, we are focusing our efforts to ensure that our whole-of-government approach yields tangible, long-term results. This is not just a matter of a software program that isn't functioning. This is a massive business transformation initiative that was not properly scoped or implemented, and we're having to go back to fix things that never should have needed fixing in the first place.

As we work on a more robust governance model, which includes an integrated team, a committee of deputy ministers, and a working group of ministers chaired by the Hon. Ralph Goodale, we are also looking at technological fixes and better integrating our HR systems with the pay system. We are also investing money in hiring people.

At the same time, we recognize—and this is one of the things I've been quite focused on over the past seven months that I've been in this role—the need for supporting employees. Because there is no quick fix, we need to ensure that our public servants get the support they need. This includes access to an emergency salary and access to funds to have assistance in filing their taxes. This also includes better support through our call centre.

As I said in my opening remarks, we'll have 100 more people in our call centre within the next four to six weeks. These call centre employees, who will now be public servants, will have access to individuals' files in a way that they previously did not.

Before, an employee could call the centre and would basically get a ticket and register that they had a question. The call centre employees didn't have access to that person's file. Now they will, and this will make a massive difference in terms of supporting and helping public servants get the answers that they need.

As I said, we are investing significant dollars in fixing—well, I'd probably say stabilizing—Phoenix, and of course we are looking at a longer-term solution that is not Phoenix. As we move forward, my laser focus, as I've come to say, has been on stabilizing the system, ensuring that our 305,000 public servants are paid accurately and on time every two weeks, and that a parallel process is begun to see what the next generation pay service looks like for the Government of Canada. That will take some time. In the meantime, we have to pay people every two weeks.

Thank you.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Thank you for those clarifications.

I mentioned the online progress that will be eventually available and, yet, I'm hearing less and less about it in the media. Is that an indicator? It should be studied. However, a few cases have still appeared in the media. We want to make sure that the case of each employee is directed to the right place internally at the outset. Clearly, we are not preventing anyone from talking to the media.

When constituents who have problems with Phoenix come to my office, we really ensure that all the internal procedures are followed to help the person and to process the file as quickly as possible. How can transparency help us and what are you already doing? Can you further clarify the progress made on processing the files?

[Carla Qualtrough, Liberal, Delta, BC]

I think it's important to understand that we are building support around the public servant. We always encourage employees, first and foremost, to go and talk to their manager because their manager needs to understand the nature of the problem, so they can help them resolve it internally. There are also robust processes within the union structure that employees have access to. We don't want to interfere with those processes and we certainly don't want to divert any resources from stabilizing the system in order to create duplicate processes.

What we've landed on, in terms of providing additional support to members of Parliament, in particular, so they can better support constituents, is a process, in which there is a series of questions or steps that a constituency office can take in supporting their constituent who walks in off the street, if you will. I think it's important to understand that this is a very unique situation that is different, say, from... I'm a member of Parliament as well. I get constituents walking in off the street with a variety of federal issues. When someone comes in with an immigration question, or a question about a GIC, or whatever it happens to be, as MPs, we help the individual access the system. The federal government is very complicated and it is sometimes difficult to understand the process, so we need to help them navigate that system. In this particular instance, we have a situation where an employee is asking a member of Parliament to help them better understand and to support them with an issue they're having with their employer.

We didn't want to interfere with any existing employment-related processes. Ultimately, a constituency office can, first of all, ascertain where the individual works or in what department. Obviously, there are some departments that are serviced by the pay centre and there are some that are not. If that individual is served by the pay centre, their department or agency is served by the pay centre—

[The Vice-Chair, Liberal, Yasmin Ratansi]

You have to wrap up.

[Carla Qualtrough, Liberal, Delta, BC]

Sure. We're doing a lot.

[The Vice-Chair, Liberal, Yasmin Ratansi]

Thank you.

Mr. McCauley, you have seven minutes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Welcome back, everyone. It's wonderful to have you back here.

I have to say right off the bat that I'm extremely disappointed in your department.

On November 28, 2017, both yourself and Ms. Lemay promised us by mid-December, within two weeks, that “We will get back to you in two weeks as to what the process will be.”

It's actually been three and a half months. As you can imagine, my party, the NDP, MPs across the country, and the several hundred thousand people affected by Phoenix are not impressed that it's taken you three and a half months, when you promised us two weeks. The system you've come up with is completely inadequate to help people.

One of the ladies I've been dealing with is Sebastianne Critchley. She was on Global News recently. She's been profiled in the National Post. I want to show you this. These are her emails that she has sent to us, and this is double-sided paper. Since I approached Ms. Lemay and Mr. Linklater in November to help her, she sent us about an eight-page letter outlining all of the issues that she's had. She approached me, and I went directly to the very top. Even with the very top people helping, we have a hundred pages of emails from the people in the department unable to help her.

The reason I mention this...and I go back to your new system where all it does for MPs is to tell the staff to go back to your department. If you can't fix it, we'll send a form up to escalate it, and we'll get back to you in two weeks.

These are Ms. Critchley's comments from this morning, “package outline steps to follow”. What happens when we follow those steps repeatedly? Again, these are the steps she has taken, and repeatedly it's failed.

I will ask you again, will your department please help MPs set up a proper process to help those who have been Phoenixed? There are a lot of minor issues that can be handled this way, but there are a lot of very serious issues, people's lives are being destroyed by this system. Simply telling them to go to the MP, and have the MPs send an email to the department, and hope to get back within two weeks is not enough.

Ms. Critchley sent another follow-up note to someone recently. She got a note back three weeks later saying, “We'll start looking into this, I am planning on reviewing this.” This is after three weeks, this is after Mr. Linklater, months ago, started it.

On behalf of those people affected, would you go back and take a serious look at providing resources, and help MPs to help their constituents? This is not a Conservative issue, it's not an NDP issue, it's not a Liberal issue. It's a non-partisan issue of MPs being able to help their constituents.

Simply sending out a form saying “Go to your boss” is not going to cut it. Please go back and review that, and get back to us on how you're going to improve the system. Why did it take three and a half months to get a simple form basically saying, “Go back to what you've already been doing”?

I want to get on to the estimates. You've committed $16 million to find a new system that's going to be going through Treasury Board. The Treasury Board is the same department that had the Gartner report, and sat on it. The Gartner report clearly said Phoenix wasn't ready to go ahead. Treasury Board did not apparently pass it on to PSPC, it sat on it.

This is the same Treasury Board that sat on the comptroller general's report in December that clearly showed the testing across all departments was showing a high failure rate, and Phoenix wasn't ready.

The same Treasury Board that sat on the project status report in December, two months before Phoenix started, said, “Clear the backlog before you go ahead with Phoenix”, the same backlog that the government has identified as the main problem with the Phoenix fiasco. It sat on it.

The same Treasury Board sat in committee in February, and questioned by the NDP and ourselves, said that Phoenix was good, 99% working, otherwise it wouldn't go ahead.

Now, Treasury Board is so complicit and incompetent in this matter, why in the world would we trust Treasury Board to choose a new system to replace Phoenix?

[Carla Qualtrough, Liberal, Delta, BC]

Quickly, in response to your first comments, we did take longer than expected to come up with a solution that we thought was workable, given my fundamental belief that we cannot divert resources from stabilizing, and we cannot interfere with existing internal processes. Those are the parameters that I have.

[Kelly McCauley, Conservative, Edmonton West, AB]

Sorry, let me interrupt. So an MP helping someone like this, whose life is destroyed, are you saying is interference with the process?

[Carla Qualtrough, Liberal, Delta, BC]

Not at all, that's not what I'm saying.

[Kelly McCauley, Conservative, Edmonton West, AB]

How is it...Please let me ask the question.

[Carla Qualtrough, Liberal, Delta, BC]

But those were the parameters that I gave.

[Kelly McCauley, Conservative, Edmonton West, AB]

How is it, when I'm trying to step in and help someone, again with a hundred pages of problems, that this is taking resources?

Whether it's her going to someone within the system for help, or me trying to step in, or my office more appropriately, to help this lady through a hundred pages of errors, how is that interfering? How is that taking away from resources?

[Carla Qualtrough, Liberal, Delta, BC]

What I'm suggesting is that if we had set up a parallel hotline system in which people would have had to answer the calls, do the inquiries, or what have you, that would have diverted.... We have a call centre that will now be able to answer and access people's files directly, and it was thought that by....

There are some significant changes in the way things were done in this, including using a centralized email, whereby one person will be looking at these issues, whereby your office will identify very clearly the financial impact.... Many of the questions we get from MPs, in which so-and-so has an issue, and then we have to go back and forth to figure out the nature of financial impact—

[Kelly McCauley, Conservative, Edmonton West, AB]

How is your new system going to address Miss Critchley, who's probably sitting at work right now dealing again with another pay problem?

[Carla Qualtrough, Liberal, Delta, BC]

The new system will get her. Les might be able to reply to the particular individual, but for a new question coming in, you'll get a response within two days.

[Kelly McCauley, Conservative, Edmonton West, AB]

I'm not asking about a new question; I'm asking about someone who's been inquiring for three and a half months, and still every new inquiry is taking a month.

[Les Linklater, Associate Deputy Minister, Department of Public Works and Government Services]

I am familiar with—

[Kelly McCauley, Conservative, Edmonton West, AB]

How is this new system going to help?

[Les Linklater]

I am familiar with this particular case. and it is very complicated; I don't dispute that. For the fact the pay centre has not provided as prompt a reply as possible, I apologize, and I will take that back, Mr. McCauley.

That said, as part of the process the minister has outlined, and as has been shared with members of Parliament, within the escalation team that we have at PSPC we are adding resources to be able to take on these cases and provide more personal assistance to the individuals who are having the difficulties you've outlined, with a view to being able to resolve more of them more quickly.

However, to be able to triage and ensure that we are addressing the most serious cases, we are asking MPs' offices as well as unions to use a comparable process to identify for us the key, critical issues, so that we can home in on them as quickly as possible.

[The Vice-Chair, Liberal, Yasmin Ratansi]

Thank you.

Mr. Blaikie, you have seven minutes.