Government Operations Committee on Dec. 12th, 2024

[The Chair, Conservative, Kelly McCauley]

Let me pause the clock for one second.

I will just advise you that the committee has passed a motion requiring all requests to be responded to within 21 days.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you, Mr. Chair.

Ms. Reza, I'll turn to you.

In the estimates, there is a line asking for $464 million, I believe, for funding for Public Services and Procurement Canada for organizational project management capacity assessment, investment planning and enabling authorities. That's quite a mouthful. Can you tell us what this is for? Is this assessment being run in-house or is there an external contractor doing this work?

[Arianne Reza]

I'll have to turn to my CFO to confirm whether this is the $469 million that's part of the capital that's associated with our ask in the supplementaries as it relates to various projects, such as Place du Portage, the West Memorial and the parliamentary precinct. There may be project management associated with the engineering and the A and E.

Just let me confirm that.

[Michael Hammond, Assistant Deputy Minister, Chief Financial Officer, Department of Public Works and Government Services]

Perhaps we could just clarify where you're taking the $400 million from.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

It's vote 1b, funding for Public Services and Procurement Canada for organizational project management capacity assessment, investment planning and enabling authorities.

[Michael Hammond]

This would be part of the $620 million we're requesting as part of the supplementary estimates (B). It's capital funding, primarily, to support the projects that Ms. Reza mentioned.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

I appreciate that answer.

I'd also like to follow up on a question I had asked the minister regarding recovering money. Perhaps I'll ask a question in regard to recovering money from the fraudsters who have managed to defraud the government over a period of time.

At the public accounts committee, you and your officials testified that negotiations were ongoing with these individuals to get money back. Can you please explain to us the nature of these negotiations? Why are you even negotiating with them instead of actually demanding that they pay the money back?

[Arianne Reza]

Thank you very much for the question. It gives me the opportunity to state that I have confirmed that the number of cases we have sent to the RCMP is seven. That number stands.

I think there was a question around how much money is owed or how much we anticipate on the fraud. I said $4.5 million. That is only partially accurate, as we're still continuing to assess those that were referred in November. That number will likely go up.

On the $4.5 million, we anticipate recovering $2.1 million or $2.2 million before year-end.

To the question about why it's taking us so long, we just started, in the last few months, with a new authority that Treasury Board gave us to actually act as the collection agent on behalf of the Government of Canada. We didn't have that before.

The next piece, as I've indicated at previous committee hearings.... It's at the consultant level. Sometimes the suppliers themselves are unaware that the consultant is working with a different firm and that there's defrauding going on. What we have done now is accelerate—

[The Chair, Conservative, Kelly McCauley]

I'm sorry, but that is our time, Ms. Reza. Perhaps Mr. Bains can give you an opportunity to finish.

Mr. Bains, the floor is yours for six minutes, please.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you, Mr. Chair.

Thank you to our officials for joining us today.

I want to ask about the current status of the NextGen HR and pay project. Could you provide an update and give any recent milestones that may have been achieved there?

[Arianne Reza]

I want to start by noting that if there's any interest in having an HR NextGen pay and Phoenix briefing, we stand at the ready to support that.

Alex.

[Alex Benay]

Yes, absolutely.

We're happy to report that we've started the testing of certain components of the NextGen solution, or Dayforce, with SSC and PSPC at this point. The tests are proceeding very well.

We are also in a position to report that we will be turning on our AI virtual assistant agent with the pay centre to help them process cases. We are gaining 30% efficiency as it is, and we anticipate being able to process cases with up to 50% gain in efficiency by the time the fiscal year is completed.

We have also done a lot of work with regard to starting to create consistent HR measures in town, for example hiring on the day after pay. Many large corporations around the world force you to start on the day after pay so as not to have pay impacts, so we're starting to put those in place as well with the current system.

There is quite a bit of development going on, and I'm happy to have that briefing, as Arianne mentioned.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

What measures are in place to test this and to validate the new system before it's fully implemented?

[Alex Benay]

Thank you. That's a great point.

We will not be deploying a big bang approach as we did the last time, or harvesting savings early. We will be doing this in an iterative fashion, department by department, so we will be able to test progressively along every step of the way.

In the case of PSPC and SSC, we have real users in the room currently, so the users are actually testing it and running test scripts. We will make all of the results public through our transparency by design program, which will enable us to release all the information publicly.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

You mentioned savings. We all know that the Phoenix pay system was a complete disaster. It was introduced by the previous government. Can you expand on what you meant when you said that you didn't anticipate savings? Why is that? I know that the Phoenix pay system was a complete disaster.

[Alex Benay]

I think, this time around, we've learned, as officials, that we need to put the system in place first, before we look at any kinds of savings discussion.

Right now, what we're focused on, this year and next, is making sure that this system runs as well as possible. Our goal is to have a fully configured system by the end of 2026 so that we can start deploying it in 2027. The reason it's taking so long is that we do have to configure it and test it every step of the way. There is no discussion of savings or any kind of harvesting of those savings until we actually have a very good grasp on the new system that we're putting together.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

This is being carefully done, because we clearly saw the challenges faced by the previous Phoenix pay system that the Harper government brought in. Is that right?

[Alex Benay]

It is being managed with care. We have made a decision to run two systems in parallel, so we know we will be running Phoenix for several years as we start deploying Dayforce, should all go well this year. For us, the running of two systems is to avoid some of the big bang situations so that we can course correct and avoid some of the mistakes of the past.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

You talked about AI and leveraging modern technologies to enhance the efficiencies and the reliability. Is that testing in its infancy right now? Whereabouts are you with that?

[Alex Benay]

We're about halfway through, I would say, in the testing phase. We are looking at three case types—for example, acting positions—to be able to complete the work by the end of this fiscal year and then to roll out the solution to other case types as we go through. Again, this is a case of doing things iteratively, step by step.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Do you have anything to share on the user friendliness? I think you mentioned that you would have to wait until the pay period is over. That's one great thing that you can instantly use, but is there user friendliness that public servants can employ in some manner? Can you talk a bit about that?

[Alex Benay]

Yes, absolutely. The good thing with our AI solution is that it's being developed with pay advisers. They are in the room. We have a team of about 30 pay advisers who are helping to design the AI solution. It means that this is a tool they're developing for themselves, which is something that's a bit different than in the past, I would say.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Are the pay advisers employees? Is that employees giving feedback?

[Alex Benay]

That's correct.

[Parm Bains, Liberal, Steveston—Richmond East, BC]

They're helping to shape, ultimately, how they use the system.