Government Operations Committee on March 10th, 2026

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

That sounds good.

[Bill Matthews]

—you cannot overspend what Parliament votes in terms of your ability to spend money. Departments will have their spending proposals or their budgets reduced in line with the approved proposals, starting with the main estimates for 2026-27.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Of course, I'm very apprehensive about the outcome of this exercise. I've been in the role of shadow minister of the Treasury Board now for close to four years, and I have had a series of ministers attempt to implement similar programs with very limited success.

For example, in 2023, Minister Anand announced the ill-hearted target of achieving $15 billion in savings. We've seen, through the public accounts and estimates, that these savings were largely not achieved. Then, the 2024-25 public accounts indicated that expenditures were up for every ministry except four, so the savings have not materialized, as far as I or Canadians can see, from previous saving attempts. I'm very concerned that the CER will have the same outcome.

I have, of course, as an elected representative, and throughout my time at government operations.... I know my fellow former colleagues on this committee share my belief that it is, fundamentally, elected representatives who are put in the position of ministerial responsibility and who ultimately carry the burden of this. Of course, you, as their hands, are expected to implement this and see their success, but I hold them responsible.

Two weeks ago, the main estimates for 2026-27 were released. I looked at these numbers very closely, and I have a lot of concerns. The government is asking for a total of $502.8 billion in spending approvals. Mr. Matthews, you said that if the money is not there, they will not be allowed to spend it, but a lot of money will still be there, as this is an increase of over $15 billion from the previous main estimates.

Additionally, these estimates indicate that, despite the promise in the budget, through the CER, to reduce spending, 64 departments and agencies are requesting more money than they did last year. We continue to go in the wrong direction with this Trudeau-Carney government.

Last summer, ministers were instructed to find ambitious savings. Why has this been ignored in the government's spending plan, according to you, in this fiscal year?

[Bill Matthews]

The way I would describe the current exercise, as well as previous ones, is like this: They're reallocation exercises. The government is looking to spend less in some areas in order to invest more in others. We all know the government has announced very large investments in national defence, so government spending will go up. Part of that is being funded by reductions in other areas. It is really a reprioritization exercise to find programs that are not functioning properly or as desired—efficiencies that can be gained.

The government tabled its broader spending plans in budget 2025, which does, as the member indicated, increase spending.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

This committee, I'm sure, continues to be—as it was during the period of time when I was here—seized by its concern about expenditures on consultants. Across government, consulting spending will increase to $26.6 billion in 2026-27, which is a 39% increase from the final estimates tabled under the previous Prime Minister. This is despite an election promise made by the current Prime Minister that he would reduce reliance on outside consultants.

In your opinion, when do you think consulting costs will finally decline?

[Bill Matthews]

Consulting costs are coming down—the difference being consulting versus contractors. They're all lumped together in the public accounts, and I can turn to the comptroller general to explain.

The bulk of contracting costs are around engineering and architecture. I would differentiate those things—for example, nurses for first nations versus management consulting. The pure management consulting is a very small portion of the amount the member referenced.

The comptroller general might be able to offer some clarity there.

[Annie Boudreau, Comptroller General of Canada, Treasury Board Secretariat]

Yes, thank you.

You made reference to the public accounts. If you add up management consulting as well as IT services, it represents roughly 14% of professional services. That is a decrease of about 10% if you compare it with last year's public accounts.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Were any consultants used in the creation of the CER?

[Bill Matthews]

Regarding any departments using consultants to help them with their CER, I know it has happened on occasion in previous exercises, but I'm unaware of any this time around.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

Thank you for allowing me to return.

[The Chair, Conservative, Kelly McCauley]

Thank you very much, Mrs. Kusie.

Ms. Rochefort, please go ahead for six minutes.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you very much, Mr. Chair.

I was wondering, from a rural perspective, what measures are in place to ensure service in rural areas, given the attrition and workforce adjustments being planned.

[Bill Matthews]

As I mentioned, in terms of the criteria departments were asked to use in developing their proposals, as well as the criteria we used to challenge the proposals, one of them was around impacts on services. There were instructions to departments and also to central agencies to be on the lookout for any proposal that would reduce levels of service to Canadians, including in rural areas. That was one of the criteria used to, I would say, scrub out proposals that didn't meet the spirit.

I would differentiate that.... Obviously, if there's a program that is expiring or is no longer being offered, that will disappear. However, on levels of service, we're very clear with departments that we did not want to see reductions there.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Was there a rural lens that was applied?

[Bill Matthews]

Was there a rural lens? No. It was level of service across the board, because every department has a service standard and is monitored against it. We were asked to make sure that no proposals impacted service, so that would have included rural as well as urban.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

My second question examines the impacts of attrition and workforce adjustments on young people. Can you comment on that and how you're ensuring that you will be maintaining a good proportion of young people?

[Bill Matthews]

As you go through one of these exercises and lessons learned from the past, preserving the youth in the workforce, as well as the diversity, is something that we want to make sure is supported. Think about the way this exercise has been designed. People who are more senior and longer in their careers tend to be more at the executive level, so you have a higher target for executives. Yes, the chair is pointing at me. That's one aspect that would bias the system in terms of preserving youth, but there's also the early retirement incentive, should it be approved by Parliament. Obviously, that would only be applicable to a worker who has been in the public service for a certain amount of time.

Part of the workforce adjustment process is looking for volunteers who have basically said, “You know what? I've actually decided I've had enough and I would like to do something different.” That could be a younger worker who just decides they would like to try something different, but again, you're typically looking at people who have been in the system a bit longer.

As a final point, when you're organizing your staffing processes to implement these workforce adjustments, you might have a group of 10 people and only seven can stay. You can build in criteria to preserve the youth, provided that every person in the program meets the basic criteria. That can be built in as well.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

At the same time, how do you ensure that you preserve the institutional knowledge?

[Bill Matthews]

That's a great question. Information management is key to that in terms of making sure that any time you're changing jobs, you're onboarding your replacements and bringing them up to date on the files. There are a lot of tools that we have in terms of preserving records, etc.

Any manager who's looking to reduce the workforce has to strike that balance between the ability to deliver the program, which you need institutional knowledge for, and your question on youth. It's up to the manager, really, to achieve that balance through that program.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Is there any regard to the proportion of women and indigenous employees?

[Bill Matthews]

If you think about women, indigenous people, visible minorities or people with disabilities, those four groups are all protected by the Employment Equity Act as well as the Public Service Employment Act. Those laws stay in place.

Basically, the government has to report every year on its ability to hire a public service or have a public service that reflects the diversity of the country. That reporting will continue. Again, as you organize your processes to decide which employees are staying and which ones are going, if there are no voluntary departures, you can build tools into that process to make sure that those groups are respected and not disproportionately affected.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you very much.

[The Chair, Conservative, Kelly McCauley]

Madame Gaudreau.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Mr. Chair.

It's interesting that we're talking about budget cuts and taking the time to reflect on this issue.

Talks about budget cuts don't go down well in Quebec, and they're almost synonymous with austerity. I've been a public servant and a business woman. I've worked in community settings and in industry. I've experienced the culture of many organizations and gone through the big changes associated with budget cuts. It's a very difficult situation.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

People are going to ask if they will be singled out and encouraged to leave. Are they going to be asked whether they're tempted to leave after 30 years of service? Are they going to be asked about their expertise and whether it's still up to date?

Let's be honest about this. People are starting to have questions, as I know from my own experience. They're wondering how they will pay for groceries, where they'll end up and what is going on.

An announcement has been made, but is there an actual plan?

Is it objective and is it too broad? Government is a massive apparatus.

Could you please give me some reassurance?