Government Operations Committee on May 10th, 2018

[Kelly McCauley, Conservative, Edmonton West, AB]

So what is the $300 million for Phoenix release?

[Marty Muldoon]

We've been named in the budget to receive a continuation of the funding—

[The Vice-Chair, Liberal, Yasmin Ratansi]

Sorry, the seven minutes are up. I'll have to go to the next questioner.

Mr. Garrison.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

Thank you very much, Madam Chair.

It's a pleasure to be here today. There are lots of important issues.

I want to note that the New Democrats share Mr. McCauley's concerns about approvals of things where we don't have the details, as parliamentarians.

Madam Minister, you presented us with a picture of Phoenix. I'm going to present you with a different picture, and that's from my constituents. I represent a riding where we have more than 1,000 people with Phoenix pay cases. We have DND, the Coast Guard, Revenue Canada. I have a whole lot of people who don't share your optimism.

When you say that you don't have a date when this will be fixed, I just did a bit of math here. You said you'd made progress—5,000 in a month. You said that in your pilots you had another 10% improvement. If you do the math on the transactions, that means that in about nine years, you'll finish with the outstanding transactions there. That's just not acceptable.

I don't see any plans in anything you talked about today...because I already gave you the credit for your pilot plans in that. Nine years from now, people can expect to have their pay straightened out. That is not good enough.

You asked the members to submit cases, and you did that when I raised this with you in the House of Commons. We submitted 13 cases on February 2, and you said that you responded within 10 days. Let me tell you what your department responded: “The request has been sent to the pay centre for review.” Not one of those cases has been fixed, and we've had no further information on any of those cases.

Those were the most egregious cases, including one of the people—I'm not going to say where she was employed because I don't have her permission to do that today—whose daughter had to make the decision to drop out of post-secondary education because they didn't want to go further in debt. The pay problems are so complex in her case that they weren't able to get some of the emergency loans and things you said, because nobody can actually figure this out.

When you said that the number of complaints or cases given to you by MPs has dropped by 190, well I haven't sent you any more because you haven't dealt with the first 13. Yesterday I got 80 more cases from DND firefighters in my riding, with severe underpayment problems in most of the cases.

With respect, Madam Minister, when you say that these are just not some extra pay or some substitution pay, people base their family budgets and paying their bills on the pay they're entitled to get, and when they don't get it, it creates severe problems.

I know you painted a somewhat rosy picture of the progress. I just don't see it. More importantly, the public servants in my riding don't see it.

[Carla Qualtrough, Liberal, Delta, BC]

First of all, thank you.

I completely understand your frustration and the difficult situation we've put your constituents in. I can assure you that in no way by suggesting that people were getting their base pay but not other types of pay was I trying to be disrespectful of the position we've put them in. I apologize if that was how it came across.

I think we have to be mindful that this will not take nine years to resolve. The math I was starting to give your colleague had to do with...if you see a 24% reduction over four months in three departments, that's not nine years, if you can reduce the other 70-odd per cent in the next year or so. We don't know if that's going to be the same result as we roll out the pilot project. We also know that there are some departments—and you have a nexus of them in your riding between DND and Coast Guard—that have extraordinary challenges with both their HR systems and how their systems interface with pay and how they input their data.

One of the things we know is that this isn't just a matter of technology in pay; this is a matter of HR. Departments are regularly submitting their HR data late, which puts a stress on Phoenix that adds a complication. As soon as a transaction becomes retroactive because it's late, Phoenix doesn't like that. Now Phoenix shouldn't behave that way, but it does. The effort we're making with all departments is to ensure that their data is inputted on time and accurately.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

Madam Minister, even if I give you your 25% improvement across the board, that's two and a half more years. Some of the cases I sent you in February have been outstanding since 2016.

[Carla Qualtrough, Liberal, Delta, BC]

We'll definitely have to look into those cases.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

That means people are waiting four years to get correct pay. It's just not acceptable.

[Carla Qualtrough, Liberal, Delta, BC]

I agree.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

Your assumption also is that you're not getting new cases. Are you telling us that you are not getting new cases and new problems under Phoenix? I don't believe that.

[Carla Qualtrough, Liberal, Delta, BC]

No, that's not my assumption at all. I apologize if I gave that impression. What I'm saying is that—and Les can help me with the math a little bit—the number of people affected went down by 11%. We are managing to basically process everything new that's coming in and to chip away at the backlog. The service standard is 80,000 a month, and that is coming in.

Les, can you perhaps give us more details on a sample month? Absolutely, we're getting new cases. We're just keeping within our service standard and chipping away at the backlog at the same time.

[Les Linklater]

That's correct. For the three departments in the pod pilot, we are keeping on top of the incoming transactions 90% of the time, and that has allowed the resources in the pod to focus on the backlog, as the minister said. We've seen that reduction.

Going forward, we want to ramp this up exponentially. At the end of May, we'll be launching another three pods for another 12 organizations. We're working with them now to set up those pods by the end of the month. There will be another wave in September with additional departments and agencies and so on. We're leveraging the experience of the people in the pods so we'll be able to expand the model as quickly as possible, recognizing that the timelines to address these issues are unacceptable.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

The last thing I heard in my riding, especially from unions like the Public Service Alliance of Canada and the National Defence Employees, is that they've given up, and they'd like to see a commitment from the government to abandon this system. They don't believe it's ever going to be fixed.

What are you doing to get a system that's going to work?

[Carla Qualtrough, Liberal, Delta, BC]

My colleague the President of the Treasury Board is tasked, in parallel with our department, with focusing on stabilizing the existing system, because we have to pay 300,000 people every two weeks. He and his team are working to look at a next-generation pay system—what it will look like and how it will interface better with HR systems. Certainly, as was put into budget 2018, the $16 million—is that the right number, Les?

[Les Linklater]

Yes.

[Carla Qualtrough, Liberal, Delta, BC]

That amount is to look into the next system. We will not keep Phoenix in perpetuity, but right now we need to focus on stabilizing this system to get us to the point where, first of all, we're handing over clean data to any new system, and second, people are being paid in the meantime.

[Randall Garrison, NDP, Esquimalt—Saanich—Sooke, BC]

Thank you.

[The Vice-Chair, Liberal, Yasmin Ratansi]

Thank you, Mr. Garrison.

I forgot to welcome you to our committee, so welcome, and thank you.

We now go to Madam Mendès.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Thank you very much, Madam Chair.

Good morning, Minister, officials, and guests. I thank you for the many updates you've given us on Phoenix, so I will not go there for the moment. I think my colleagues will take enough time with that.

I would like to ask you about prompt payment and the progress that has been made. I have some subcontractors in my constituency who have been working on the new Champlain Bridge project and who are quite impressed—well, positively impressed—with the federal government's decision to impose prompt payment, but we would like to see our provincial counterparts take the same approach, too. Could you give us an idea of the progress that has been made on that and how it's been implemented through federal contracting?

[Carla Qualtrough, Liberal, Delta, BC]

I know this has been a preoccupation of many of you on this committee. We have learned a lot from what has happened in Ontario, and we are taking a very similar approach with industry organizations. Earlier this year, we announced that we were seeking industry input and recommendations that will inform federal prompt payment legislation. We have retained the firm of Reynolds and Vogel, a third party contractor that was instrumental in bringing partners together in Ontario. They are out seeking input from the construction industry to identify the elements that would be in this legislation. We're hoping to very soon be in the process of accepting those recommendations, putting those elements in a legislative form, and starting that process within the House.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Thank you very much.

I think a lot of it has already started to happen just because people know the legislation is coming and they've started to act on it, but it would be, I think, extremely important for them to know not only that the federal government has acted, but also that what it has done will influence the provincial—

[Carla Qualtrough, Liberal, Delta, BC]

I apologize. Yes, I think the key element to this is showing leadership and putting some influence on other provinces and territories to follow suit because so many subcontractors are within provincial jurisdiction.

At the federal level we can show leadership and raise these issues at FPT tables where we have those opportunities and show the success of Ontario, and ultimately our success, will inspire other provinces and territories to follow suit.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

This very long delay in payment for the subcontractors who don't have the financial capacity to withstand...has been an important, very troublesome matter that's been going on for years.

Now I'd like to go to another subject that I hold dear to my heart, and it's Canada Post. We have a new chair, five new board members, but we still have no CEO. I know that Ms. McDonald is interim CEO.

Could you give us any indication, Minister, of when we should expect the nomination of the CEO?

[Carla Qualtrough, Liberal, Delta, BC]

As you know, Canada Post has been studied in depth over the past while. We put forth our vision in early January for a renewed Canada Post that does focus on service to Canadians.

Our appointment of Jessica McDonald as chair, quite frankly, has been extraordinarily positive for both the organization and union-management relations. She's working very hard, as I said. We made the five appointments last Friday. We are working on the CEO appointment; we're close. I can't give you any more information than that, I apologize, but I have a meeting this afternoon on that.

It's very hopeful. Profits are good. We're really looking, and Ms. McDonald and her senior management team and the board have a renewed energy and innovation around this, and I'm really interested to see what they do with Canada Post.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

When would they indicate where they would like to take the organization? Are we expecting something this year? Next year, after...?