Government Operations Committee on April 23rd, 2026

[The Chair, Conservative, Kelly McCauley]

Would you provide to us in writing the ones you are referring to?

[William Kendall]

I'd be pleased to tell you right now.

[The Chair, Conservative, Kelly McCauley]

No. Put it in writing, because I have to suspend.

[Voices]

Oh, oh!

[The Chair, Conservative, Kelly McCauley]

I have another question.

Mr. Moor, you mentioned that the CER savings are mostly fleet retirement and reduced property. I know you mentioned the Kingston class, but could you provide any other fleet retirement, as well as the related cost savings—if you could break it out in such a way? Also, could you provide any property or perhaps buildings that are being decommissioned, for a lack of a better word? Could you provide that in writing to the committee?

[Jonathan Moor]

I'd be happy to.

[The Chair, Conservative, Kelly McCauley]

That's wonderful.

Thank you for being with us today. We really appreciate it and some of the new information we have heard about FINTRAC and getting down to the money laundering and other issues. It's greatly appreciated.

We will suspend for five minutes as we bring in Shared Services Canada and PSPC.

We are suspended.

[The Chair, Conservative, Kelly McCauley]

We're back in session. Thanks to everyone for your patience.

Welcome back to our witnesses.

We'll start with Mr. Davis.

You have an opening statement. Welcome back to OGGO. Go ahead, please, sir.

[Scott Davis, Assistant Deputy Minister, Chief Financial Officer, Shared Services Canada]

Thank you, Mr. Chair, for the opportunity to discuss how Shared Services Canada will achieve savings through the comprehensive expenditure review.

Before I begin, I would like to acknowledge that we are gathered on the unceded and traditional territory of the Algonquin Anishinabe nation.

At its core, Shared Services Canada provides the Government of Canada's shared IT foundations, such as networking, data centres, cloud services, digital tools and cybersecurity, so departments can deliver programs and services reliably and securely.

Since 2016, SSC's funding has remained relatively flat, while demand, reliability and complexity have increased. The department has absorbed inflationary pressures and rising demand by leveraging efficiencies and economies of scale. Although SSC's total appropriation in 2026–27 is 25% higher than it was in 2016–17, this growth is driven by time-limited and targeted funding. In fact, once budgetary adjusted items and the previous refocusing government spending exercise are accounted for, SSC's base funding is lower than it was in 2016–17.

When combined with savings already delivered through refocusing government spending initiatives, the comprehensive expenditure review reductions will significantly reduce SSC's available funding compared with earlier years.

To make these changes, our approach was not to ask how we get to the number. Instead, we asked what we should not be doing any longer. The review is not only a savings exercise for SSC but also an opportunity to accelerate enterprise-level efficiencies through enterprise-wide solutions and by leveraging the department's collective purchasing power for the government as a whole.

Under the comprehensive expenditure review, SSC will achieve 15% savings over three years—an ongoing decrease of $318.5 million a year. We will do this by standardizing what we use, buying and managing technology as an enterprise, and improving how we deliver services.

SSC is standardizing platforms and realigning enterprise software offerings to reflect current needs, eliminating non-essential fixed-line telephones in government buildings, and deploying cost-effective softphones to all workers.

The department continues to review and consolidate contracts to reduce duplication, improve pricing and better align spending with enterprise needs while strengthening in-house capacity to reduce reliance on external consultants and contractors for ongoing operations. Efforts to simplify the government's cloud footprint by consolidating over 287 cloud environments into SSC's enterprise cloud are ongoing, and we continue to consolidate by reducing the remaining 190 legacy data centres.

Shared Services Canada, or SSC, has put in place strong governance of the review to provide oversight, track progress and ensure accountability for results.

On professional services, SSC required additional resources during the pandemic, when we moved fast to support remote work. We are now back to pre-pandemic levels and stabilizing.

Under the Refocusing Government Spending initiative, SSC exceeded our savings target with an $81-million reduction in professional services since 2022-23, and we plan to continue those reductions where feasible.

In conclusion, the savings measures we are looking to implement will ensure sound financial management in a tightening fiscal environment by eliminating duplication, addressing lower-value activities and improving efficiency.

Thank you, Mr. Chair.

I welcome your questions.

[The Chair, Conservative, Kelly McCauley]

Thanks, Mr. Davis.

Mr. Hammond is next, please.

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

Mr. Chair, thank you for inviting me today to take part in your study.

Let me begin by acknowledging that we are gathered on the unceded territory of the Algonquin Anishinabe peoples.

Joining me today is Kiran Hanspal, assistant deputy minister, human resources branch.

I am pleased to be here today to discuss details of the comprehensive expenditure review contained in budget 2025 as it pertains to Public Services and Procurement Canada, or PSPC.

PSPC is committed to responsible stewardship of public funds by reducing operational inefficiencies and focusing on core mandates, while continuing to deliver reliable services for Canadians.

As part of meeting this commitment, PSPC is planning the following spending reductions as part of the comprehensive expenditure review. In the current fiscal year, 2026-27, a reduction of $108.9 million. In 2027-28, the reduction increases to $147 million. For 2028 -29, the reduction under the comprehensive expenditure review is expected to be $190.8 million.

The number of full-time equivalent positions at PSPC is expected to reduce by 1,793 by fiscal year 2028-29 through a combination of workforce adjustment, attrition and other human resources measures.

PSPC is implementing a number of measures under the comprehensive expenditure review. The department is assessing programs and services it provides across government with the aim of reducing ongoing operational costs and improving delivery efficiency. The department is also working to increase the efficiency of its real property revolving fund, focusing on core mandates, modernizing operations and eliminating duplicative functions.

As of March 31, 2026, the Canadian General Standards Board has wound down its standards development operational activities, as this optional service will now be served via other accredited standards development organizations operating in Canada.

There will be a reduction in funding to pilot and innovation projects for Laboratories Canada.

PSPC is also reviewing its internal processes in order to reduce administrative requirements, streamline its management structure and improve efficiencies.

PSPC is also reducing spending on professional services and travel, as well as implementing the use of AI chatbots and self-service tools to improve service delivery.

The implementation of these changes will be gradual and measured, so that PSPC can continue to support government priorities and effectively deliver services in our role as a common service provider.

Mr. Chair, before I take questions, I will quickly outline the processes taking place at PSPC regarding workforce adjustment.

The department is undertaking a workforce reduction exercise, while at the same time taking all possible measures to minimize involuntary departures, always respecting the conditions of employment set within all collective agreements.

PSPC has been leveraging normal attrition and voluntary departures as a means of reducing our workforce and will continue with this approach.

In addition, the recently approved early retirement incentive program is expected to provide further flexibility and support in reducing the need for involuntary workforce adjustments.

Reorganizations within PSPC are already taking place for our workforce to be better aligned with priorities, more efficient and more sustainable over time.

During this period of change, PSPC will continue to provide the critical services of procurement, pay, pension, real property and translation, among others, while supporting our people and maintaining our commitment to their health and well-being during this period of change and transformation.

I am happy to take your questions.

Thank you.

[The Chair, Conservative, Kelly McCauley]

Thanks, Mr. Hammond.

We'll start with Mrs. Block for five minutes, please.

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

Thank you, Chair.

Thank you to our witnesses for joining us today.

My questions will be directed to those representing PSPC this afternoon.

As you mentioned, your departmental plan states that PSPC is planning spending reductions of $445 million over the next three years. Did I understand that correctly?

[Michael Hammond]

Our reduction related to the comprehensive expenditure review is $190 million over three years.

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

It's the difference between the years you highlighted adding up to $190 million. That's good to know.

You mentioned that you will be decreasing your full-time equivalents by 1,793, but you also mentioned the measures by which you will be doing that. You mentioned other human resources measures. Could you tell us what those include? If not attrition and voluntary departure, what would those be?

[Michael Hammond]

When we refer to other HR measures, we talk about workforce adjustment, and we talk about attrition. Other HR measures could include things like the early retirement incentive program that has recently been put in place by the Government of Canada.

I'll also turn to Kiran, in case she wants to add something more on that front.

[Kiran Hanspal, Assistant Deputy Minister, Human Resources Branch, Department of Public Works and Government Services]

We started our staffing control measures even before the CER. We stopped the clock on turning terms into indeterminates, so we have been actioning very tight HR planning and managing through attrition.

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

Thank you for that clarification.

Do these cuts affect all departments, or are there certain departments that will be affected more than others?

[Michael Hammond]

I assume that when you refer to departments, you're talking about areas within PSPC properly.

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

Yes, I mean areas within PSPC.

[Michael Hammond]

Regarding reductions to various areas across the department, there are certain areas where we focused more attention because, again, we were trying to align our resourcing and our proposals to focus on core government priorities. Areas like pay, for example, and pay processing are less affected than other parts of the organization, where we had a better opportunity to look at lower-value activities and realign them into higher-value areas.

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

Which regions will be facing cuts, and how many will there be in each region? Do you have those numbers?

[Michael Hammond]

Kiran may have the numbers by region with her, but I can tell you that the majority of the reductions related to the comprehensive expenditure review are within the national capital region. That's where most of the reductions will be taking place, but there are some reductions that will be happening across the regions.

Kiran, do you want to add something on regions?

[Kiran Hanspal]

Yes. We looked at the impact of our CER reductions and WFA reductions, and we compared it to a baseline of national capital region versus regions. We have a baseline 60 to 40 split for the population. When we looked at the people who are going to be subject and who are being subject to WFA, the split is 86% to 14%. The impact on the regions is fairly low. In fact, if you break it down by region, the breakdown is under 10 people on average across the regions.

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

Do these cuts include the minister's office? Are you aware of any positions being cut in the minister's office?