Government Operations Committee on March 20th, 2023

[Yves Giroux]

I think it's important to have at-risk pay as an incentive to enhance performance among executives but also to reward high performers and distinguish them from average performers or poor performers, which there are in any organization.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

In 2022-23, the Government of Canada requested $443.3 billion in authorities: an increase of 6.8% over 2021-22, but a decrease of 6.6% compared with 2020-21. In your view, is this level of spending consistent with Canada's fiscal anchor, that is, to reduce the debt-to-gross domestic-product ratio?

[Yves Giroux]

It is consistent except for next year, the year that will start April 1, where we expect to see an increase in the debt-to-GDP ratio, which would be, based on what we know so far, a blip or an anomaly in an otherwise downward trend at a moderate pace in the debt-to-GDP ratio. However, that's based on information we have right now, which may change when the Minister of Finance tables her budget next week.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

I have a very general question. You mentioned in a previous round that the government does a reasonably good job around sound debt management, and I'm really curious. For the pandemic that we're technically coming out of, we're still seeing the side effects across government departments and certainly within society. Also, obviously, there are the very real geopolitical realities and climate change realities that none of us could ever have predicted.

On the balance of trying to manage these in-the-moment crises, I'll reference one on the southwest coast of my province of Labrador—

[The Chair, Conservative, Kelly McCauley]

I'm afraid you're out of time. Would you be able to provide a quick question?

[Joanne Thompson, Liberal, St. John's East, NL]

Basically, how do you manage those unforeseen crises and then still also manage the work of the country and the—

[The Chair, Conservative, Kelly McCauley]

I'm afraid that is our time.

Mr. Giroux, you'll have to get back to us if you have an answer for that.

Ms. Vignola, you have two and a half minutes, please.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Chair.

Mr. Giroux, your report states the following:

As of November 2022, nearly $10 billion dollars have been spent on professional and special services this year - a record level compared to previous years over the same period. The 2023-24 Main Estimates indicate that planned expenditures on professional and special services will remain steady at $19.5 billion in 2023-24.

That number sets a record. In addition to the $10 billion spent in this fiscal year to November 2022, the government has 320,000 public servants, which is also a record in absolute numbers. However, it represents just under 1% of the population, which could be considered more or less reasonable or normal.

How can you explain the combination of record spending on external services and a public service that represents approximately 1% of the population? Do you have any concerns about these combined figures?

[Yves Giroux]

I have concerns about these two factors when they are accompanied by perceived service shortcomings in several sectors in which the government has an important responsibility.

Increasing the size of the public service is something that is dependent on government decisions. Increased use of consultants is also a decision of the government and its senior officials or deputy ministers. Both decisions make sense if services are greatly improved, but I think that all of you, as members of Parliament, probably find that every day in your riding offices that these services are not always meeting the expectations of citizens. That's where my misgivings lie.

If the decision to increase spending on counselling services, while also increasing the number of public servants, results in improved service delivery and more informed advice to ministers, that's one thing. But if the expenditures increase in both categories, while services do not appear to be improving, that's when I have concerns.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

We have the same concerns.

Thank you very much for your time.

[The Chair, Conservative, Kelly McCauley]

Thank you very much, Madame.

Mr. Johns, you have two and a half minutes.

[Gord Johns, NDP, Courtenay—Alberni, BC]

When Canadians didn't have enough PPE when the pandemic started, the government called upon Canadian small and medium-sized enterprises to establish a domestic PPE supply.

I think of Wayward Distillery in my riding. They pivoted their distillery to provide hand sanitizer for public safety workers, health care workers and people on the front lines. They certainly stepped up, and they invested in making sure that they had that. They were called upon by the government and they delivered, but we didn't honour our commitment to them.

The government started ordering foreign PPE and flooded the market, driving the price down. We know the government and the minister have made commitments to buy Canadian PPE, but it's not flowing to the small suppliers.

Have you done an analysis on the impact on the Canadian economy of buying foreign PPE and on the multiplier effect when it's produced domestically?

Lastly, in terms of security for Canadians, to ensure that, if there is another PPE shortage in the future, we've strengthened and supported our domestic PPE industry so that they're ready to respond should there be a crisis.... I would imagine, right now, they're going to be pretty reluctant.

I know, like I said, that Wayward Distillery in my riding got saddled with sitting on almost a million dollars' worth of product, and they paid a hefty price dumping that at a loss.

[Yves Giroux]

It's an issue that certainly is important. It was even more important a year or two ago, and it could become important again. Unfortunately, we have not looked at the economic impact of procuring PPE from abroad, or at the national security aspect of relying mostly on foreign suppliers.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Okay.

How much time do I have?

[The Chair, Conservative, Kelly McCauley]

You have 20 seconds.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Going back to the question on student loans, do you project that the elimination of student loan interest in April 2023 will affect Canadians' ability to pay their student loan debt? Do you see that it would drop from what you're forecasting right now?

[Yves Giroux]

The government decision to reduce effectively to zero the interest on student loans should result, in future years, in the student loan debt writeoff to decrease progressively. Given that it's a seven-year process between the time the debt becomes questionable until it's written off, it will take several years to be reflected in student debt writeoff. It should have a marked impact on the number of student loans in default.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Super. Thank you again.

[The Chair, Conservative, Kelly McCauley]

Mr. Johns, thank you.

Mr. Giroux, thank you very much.

Ms. Vanderwees, I'm sorry you didn't get a chance to interact with us, but it is always a pleasure to have our honoree OGGO member from PBO join us. Thank you very much.

Colleagues, I have two very small housekeeping announcements.

The committee is going to be considering the recommendations for the report on travel expenditures related to the office of the Governor General's secretary since 2014 for the second hour on March 27. I do encourage everyone, because we had so many recommendations and so many overlapping.... We agreed to pare them down to discuss among each other.

The second item is that the committee will receive a brief presentation from the legislative clerk at the start of the second hour on March 27 on Bill C-290, an act to amend the Public Servants Disclosure Protection Act. If you recall, we were going to have them in, but it got bumped.

If there's nothing else, colleagues, we will adjourn. Thank you, everyone.