HUMA Committee Meeting

STANDING COMMITTEE ON HUMAN RESOURCES DEVELOPMENT AND THE STATUS OF PERSONS WITH DISABILITIES

COMITÉ PERMANENT DU DÉVELOPPEMENT DES RESSOURCES HUMAINES ET DE LA CONDITION DES PERSONNES HANDICAPÉES

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, April 6, 2000

• 1116

[English]

The Chair (Mr. Peter Adams (Peterborough, Lib.)): Colleagues, perhaps we could begin. Before I introduce our witnesses I have two or three things to say. First of all, our order of the day is, pursuant to Standing Order 108(2), the study of HRDC grants and contributions.

If I could—and I think most of you have this material on your desks; if not, it's coming around—first of all, I would like to note that the Association of Public Service Financial Administrators, who were on our list as witnesses and who are here today, have provided us with written material that is in addition to the material you'll be presenting today, is that correct?

Mr. Merdon Hosking (President, Association of Public Service Financial Administrators): Yes, it is the background document.

The Chair: So, colleagues, in addition to the text, which you also have, we have a background document, and we do appreciate that. It's very detailed.

Colleagues, if I could go further, you have copies of letters from, first of all, the Canadian Institute of Chartered Accountants, whom we invited as witnesses, and you will notice that Peter Wilkinson, their director of government affairs, has written to us saying that they appreciate being contacted, but they do not have direct knowledge of matters before the committee and therefore they believe they would not be in a position to offer assistance at this time. Again, that might be a matter for us to discuss when we get to the matter of discussing the list of witnesses still to be called. I would like you to note this, that the group, the Canadian Institute of Chartered Accountants, who were invited, feel they have little to contribute at this time.

Similarly, we have a letter from the CGA Canada, who are the Certified General Accountants Association of Canada, whom we also invited. And they write—this is Mark Boudreau, who is vice-president, public and government relations—that they thank us for the invitation, but note that other than following the media reports and monitoring the debates in the public arena they also feel they do not have special knowledge of the HRDC situation. So I would like you to note those two pieces of correspondence.

If I might also say, you will recall that at our last meeting we agreed that at the end of today we would take a few moments to consider our future business. And I would suggest that we do this, that we will conclude this meeting—I will conclude it relatively early if that's possible—and then we will meet for a few minutes to discuss our plans.

The plans are roughly this. We have to complete our interim report so that it can be tabled, if necessary, a week today in case the House closes a week today. This means that next Tuesday and Wednesday our meetings will be consideration of the interim report. So Wednesday will be an extra meeting.

Then my suggestion the last time—and this is what we will be discussing at the end of today—is that our meeting a week today, next Thursday, be devoted to future business in light of the interim report we will have completed by that time, and that future business will include consideration of witnesses still on our list, including those who responded to us today.

• 1120

Colleagues, is that reasonable? I see that it is. And to our new member, John Bryden, I'm pleased that you agree with how we function on this committee, John.

Colleagues, perhaps I could now introduce to you our witnesses.

Witnesses, we do welcome you here. And we apologize for the slight delay. I think you know there was a vote in the House of Commons, so we're starting a little bit late. I'll go through your names in the order we have them here, and then, Merdon, we'll go to you.

We have, first of all, for the Association of Public Service Financial Administrators, Merdon Hosking, who is their president; and Greg Gauthier, who's director, labour relations and negotiations. We welcome you both.

For the Canada Employment and Immigration Union, we have Cres Pascucci, who's their national president. Cres, it's a pleasure to have you here. We also have Jeannette Meunier-McKay, who is their national executive vice-president,

[Translation]

—whom I welcome—

[English]

and Molly Boyd, national vice-president, Ontario headquarters, and program officer. Molly, welcome to you, also. And we have Jim Richards, national vice-president, P.E.I., program officer. Jim, we welcome you.

I understand we're starting with Merdon Hosking. So, Merdon, we're in your hands.

Witnesses, if you would proceed through your statements one after another, then we'll go to the questions and answers in the usual way. You will notice that I have to try to keep reasonable time and balance. When we get to questions and answers, you should realize your answers are included in the member's time. So the member essentially has time for an exchange. Sometimes our members' questions are very long, in which case your answers should be very short. But I'll remind you of that from time to time.

Merdon Hosking, president, Association of Public Service Financial Administrators.

Mr. Merdon Hosking: Good morning. Thank you, Mr. Chairman, for the opportunity to appear before you today.

Distinguished members of Parliament, I am here today on behalf of the Association of Public Service Financial Administrators to share with you our views on the current state of financial management within the public service. We also want to offer some recommendations that we believe will help rebuild and strengthen the public's confidence in institutions of government.

This is a departure for us at APSFA. We are far more at ease discussing these issues within the confines of the bureaucracy rather than in the political arena. Our organization is a certified bargaining agent for the financial management group in the federal public service. We represent over 2,000 financial officers, the majority of whom hold professional accounting designations or business degrees. Our members work in government departments throughout every region of Canada. Despite the recent criticism, we have always demonstrated professionalism in our performance and the highest standard of prudence and probity in the management of public funds.

In appearing before you today, my first task is to reassure this committee that the advice given to government managers on financial matters is as good as that given to any private sector enterprise. That being said, we continue to strive for excellence and improvement. We recognize that there have been problems with the management of grant and assistance programs, but we refute the suggestion that these problems are the result of negligence on the part of public servants. We contend that these problems are the result of antiquated financial practices and significant cuts resulting from program review.

We are not here to point fingers. Instead, we are here to offer our assistance by providing this committee with solutions that we believe will help strengthen the financial management community and restore the public's trust in government.

Members of this committee are well aware of the massive downsizing that occurred in the public service resulting from program review. This included the financial management group. Since 1995, we have seen our members decline from just under 2,500 in 1995 to just over 2,000 today. Recruitment has not kept up with attrition, program review, and departures for the private sector. On average, our age today is 40 and we expect that within the next seven years approximately 40% of financial managers in the federal government will retire.

• 1125

We strongly believe that urgent action is required to reverse this trend. Since 1993 the Auditor General has released four separate reports expressing strong concern with the availability of financial expertise in the federal public service. We have been trying to work cooperatively with senior government officials and ministers to try to address these concerns, but frankly, the Auditor General continues to find the results are inadequate. So do we.

We view the approval in November 1995 by the Treasury Board of the financial information strategy as a positive and significant step to renewing the government's financial administration systems. As well, we see the recommendations of the January 1998 Independent Review Panel on Modernization of Comptrollership in the Government of Canada as a positive step forward in reshaping public financial accounting.

The panel recommended that the government will have a significant need for training and expertise of financial professionals in modernizing comptrollership. We concur with this recommendation and would encourage the government to implement the panel's recommendation as quickly as possible.

Again, there has been progress but we are not satisfied with the speed and level of commitment. Without an accompanying increase in the number of qualified financial managers, the implementation of FIS and modern comptrollership practices will remain unrealized. Clearly, with the financial community stretched to the limit, we are not in a position to properly and effectively implement these changes.

Our association firmly believes that the public service's ability to recruit and retain qualified financial managers is inadequate, and unless action is taken to stem the bleeding, the public service risks becoming a finishing school for highly qualified professional managers for the private sector. The implications are obvious: no institutional memory and increased training costs, just to name a few.

The challenges of FIS and modern comptrollership now more than ever require specialist financial expertise and the highest standards of professionalism. The adoption of full accrual accounting practices and accounting policies that match costs with results will be a radical departure from the government's current accounting practices. It will demand even greater value-added financial input to decision-making. While the association and its members fully accept the challenges presented by these two significant initiatives, we are concerned about the level of commitment and dedication shown by senior managers within the Treasury Board. We are concerned that the public service is content to achieve affordable excellence instead of striving to retain and recruit the best and the brightest.

In the past few years we have detected a growing trend towards the use of employees in financial management positions who do not meet the educational and professional standards as established by the Public Service Commission. While we have challenged many appointments through the Public Service Staff Relations' Board, we remain concerned that the presence of unqualified individuals in financial positions dilutes the quality of financial expertise as well as the community's professionalism. This is strong evidence that a shortage of qualified financial staff exists within the public service.

As we move into the next decade where greater complexity is to be expected, we must be cautious that we do not allow the pressures of administrative efficiency and better client service results to reduce the quality or the standard of professional financial management. If the public service is to remain an employer of choice, the costs of retaining, recruiting, and motivating financial professionals must be recognized as the cost of maintaining public confidence in the accounting and management of public funds.

To this end, we recommend the following three steps.

One, immediate action must be taken to address issues of attrition, recruitment, and retention. Without the necessary expertise within individual government departments, events of the kind this committee is currently studying will become commonplace. We believe only qualified financial managers should hold financial management positions within the public service. Urgent action is required to address this issue, which will rebuild the public's confidence in the government's ability to manage public funds and restore faith in our public institutions.

• 1130

Secondly, financial managers must be better integrated into the government's operations and program delivery. To ensure program managers adhere to proper financial standards and procedures, greater oversight must be part of the changing role of the financial community if we are to continue to realize the highest levels of prudence and probity.

Thirdly, consideration should be given to the re-creation of the Office of the Comptroller General, separate and distinct from the Office of the Secretary of the Treasury Board. This separation would ensure vigorous leadership of the financial community and harmonized practices across departments and would provide vision in the adoption of financial practices government-wide.

As the Auditor General recently pointed out, government initiatives do not run on autopilot. There is a strong need for oversight, as policies and programs cannot simply be rolled out from central agencies in their broadest form and left to individual departments to administer.

Parliamentarians and all Canadians must realize the financial professionals we represent are committed to the challenges of managing public funds with the highest degree of ethics and integrity. Now more than ever, the government needs a strong financial community. We are part of the solution and would encourage you to actively support and promote a revitalized financial community in the public service, with the highest standards of professionalism and expertise.

Thank you very much for your time. I do hope you will consider including our recommendations in your report to the House of Commons.

The Chair: Thank you, Merdon.

[Translation]

Greg, do you have something you would like to add? Nothing?

[English]

Now, from the Canada Employment and Immigration Union, we have the national president, Cres Pascucci.

Cres.

Mr. Cres Pascucci (National President, Canada Employment and Immigration Union): Thanks very much, Mr. Chair. Sister Meunier-McKay will make the presentation and I'll deal with the recommendations.

[Translation]

Mrs. Jeannette Meunier-McKay (National Executive Vice- President, Canada Employment and Immigration Union): The Canada Employment and Immigration Union (CEIU), a component of the Public Service Alliance of Canada, represents the majority of workers at Human Resources Development Canada (HRDC). CEIU welcomes the opportunity to appear before this committee and will offer comments in two areas.

The first is the set of conditions under which our members have worked since 1995 at HRDC and the effect on our members of the recent public scrutiny received by the department. We will, in addition, comment on the broader issues in the public debate over HRDC operations.

Since 1995, the government has cut more than 5,000 jobs from HRDC. These cuts left the department without adequate numbers of staff and without the depth of experience and knowledge to do the work. In addition to these cuts, an additional 2,000 positions left the department through the devolution of labour-market activities to the provinces and territories. Furthermore, there was an emphasis on contracting out important public services such as assessment, counselling and training. The closure of more than 100 Canada Employment Centres gave rural Canada second-class service or no service at all. This was a massive downsizing and its negative consequences for the department's accountability to Canadians and its service to the public were predictable.

The government of the day was basically conducting a fire sale of employment services. The atmosphere of insecurity compounded by five straight years of wage freezes and a 14-year battle for pay equity served to test the workers' commitment to deliver the programs.

The staff cuts were motivated primarily by the government's desire to save money and to be seen as embracing the private sector view of the need to be "lean and mean". The consequences for those workers who remained, and for the Canadian public, received little attention from those who drove the policy of cuts. For our members who stayed on, the workplace rapidly became intolerably stressful and devoid of the satisfaction that, at one time, flowed from delivering quality services to members of their community.

• 1135

An audit performed by HRDC in 1998 sets out the consequences of the staff cuts for our members and for the Canadian public. Our members faced "stress", "exhaustion" and plummeting morale in the face of the pressures under which they worked. The audit pinpointed a number of pressures which included staffing shortages, insufficient budgets and inadequate staff training. Members faced increased pressure to give faster service of better quality with fewer resources. Any reasonable person could have predicted the outcome of these staff cuts but to the management consultants of the day, and their followers in government, the prescription of "do more with less" had no side effects. Our members got the predictable grief and they want no more of it.

Despite the grief that came with the severe staff cuts, the audit notes the exceptional efforts that staff at HRDC made:

It is important to recognize that HRDC has made substantive achievements in the delivery of programs and services despite the enormous organizational changes. The dedication and commitment of employees to quality service are a reason for these achievements.

Our members are proud of the work they do for Canadians, but they need adequate resources to do it properly.

The recent critical public scrutiny at HRDC did not surprise many of our members; they knew about the department's difficulties but in the absence of whistle-blowing protection they were in no position to bring the problems into public view when they first arose. The public uproar over the administration of programs at HRDC has cast our members in a poor light and pushed their morale even lower. Our members want to take a proud and active role in their communities but the critical public review of their employer, however justified, makes this difficult.

In order for our members to do their work well and for Canadians to have an open and accountable public service, there must be a willingness on the part of the government to abandon once-popular practices. The first practice is the cutting of staff in an arbitrary manner and the expectation that the affected department will somehow continue to function effectively. This is simply a variant of the view that "we'll all put our heads down and muddle through somehow." It has not worked at HRDC so far, and it will not work in the future. As the audit, mentioned earlier, notes:

The present working environment is set up to resort to shorter, reactive approaches to managing programs and services... this sets up the potential to lose sight of client needs, create an increasing number of financial risks and create more work in the long term because of the inability to thoroughly address issues at the earlier stages.

If there is to be proper accountability for the disbursement of public funds, there must be an adequate number of staff for all duties but especially for the key functions of monitoring and auditing.

• 1140

The government must revisit its severe cuts to the staff complement of HRDC. The simple fact is that the cuts were far too deep. Staffing levels must be raised to meet the need for accountability and to provide solid service to the public.

[English]

The second practice the government must abandon is the gutting of accountability procedures in the name of eliminating bureaucratic red tape. Needless regulation should never be defended, but regulation necessary for accountability should always be upheld, even when it may be politically unpopular to do so. Pushing staff to approve projects quickly in order to get the money out the door must end.

The third practice is the contracting out of work. This practice rests on the questionable premise that the private sector always works in a more efficient and cost-effective manner than the public sector. The audit mentioned above cited the concern that the department and clients were not getting the best value from third-party contractors. Evidence should take the place of premises about the contracting out of work. If the government is to be accountable to the people of Canada, there must be a thorough and open review of the work that has been contracted out. The creation of a parallel public service in private hands but using public funds is a contradiction in itself.

The current HRDC six-point plan is meant to put everything back together again and to improve the administration of the programs. This effectively leaves us with the status quo. It does not deal with the questions of who delivers the programs and who will monitor them. In other words, it does not go to the root of the problem. Therefore we must go further. If we want public accountability, we must deal with who delivers the programs, who monitors them, and who determines their effectiveness.

Mr. Cres Pascucci: The committee should strongly consider the following to have a vibrant employment service and effective and accountable job creation programs.

One, there must be adequate staff and training. The point has already been made. HRDC is committed to making a proposal to Treasury Board, but it is essential that the additional resources go toward hiring front-line staff who will deliver the programs, and not to contracted consultants and third parties.

There must be a strong commitment to training. This is extremely important for the members of the committee. Our members are tired of being appreciated by pizza Wednesdays or muffin Fridays to show how worthy they are. They need more people to work with them to do the job properly. This must be done immediately. After all, who is monitoring the present files, closing the fiscal year, and dealing with new applicants?

Currently applications are being delayed, so a number of organizations don't know where their funding is coming from. As a result of that, they have to either lay off people or put people on volunteer work in terms of continuing on their particular programs. That's really not acceptable if you want to provide a good public service.

Two, allow carry-over and conversion of program dollars into salary dollars. A carry-over to the next fiscal year of 10% of unspent money should be allowed, and up to half of that should be allowed to be used to hire and train new staff.

How has the department tried to make up for the shortage of staff in the offices? They hire students. They hire interns. They have these programs where workers are being paid half of what unionized workers make, and they put it under the guise of training or experience for these people. They do not have any rights or collective bargaining rights and aren't able to speak out, because they don't belong to the union.

Allow half of that carry-over to be used to hire and train new staff who would be members of the bargaining unit. This would greatly decrease the massive spending of funds in March that is tied to work performance, which is another way of saying bonuses. Just to give you an idea, in HRDC during the fiscal years of 1995 and 1996, the EX management part of the organization received $876,000 in bonuses. In 1996 and 1997 they did even better; these management EXs received $980,000 in bonuses, the equivalent of $4,000 per year basically. And what did the members of the bargaining units receive? Zero. Zilch. It was, “Just carry on, eat those Friday muffins and have fun with that Wednesday pizza.” That was the equation.

• 1145

So in these terms, there must be a decreasing of the massive spending of funds tied to the work performance and bonuses and there must be flexibility allowed in order to deal with workload and with projects that require some funding over two fiscal years.

Three, restore core services. Core services such as counselling, assessment, and training should be returned to the HRCC so that they can be controlled and provide a standard of service that can be readily assessed. Right now there's very little to indicate that any form of counselling is taking place on these new projects, and as for the quality of counselling, there's no indication of what quality there is, of what certification the counsellors have.

It's well recognized that HRDC—and before that the CEIC—had the best counsellors in the world, the best work adjustment programs in the world. Basically many of those functions are now in this parallel public service, which I'll talk about in just a moment. In order to conserve consistency so that no matter where you live in Canada those services are there, those core services should be returned to the HRDC. Then what will happen is that you'll be dealing with everybody who needs the service; not just those who can succeed will get the service. There's a big difference in that regard.

Four, stop the contracting out. There should be a joint union-employer committee to review future proposals of contracting out of public services so that the Canadian public can receive the best and most efficient service.

What happens when you contract out services is that you create a parallel public service. It's like medicare and having private institutions and public institutions doing similar services; it's two-tier service. That's basically what it means. In the medicare debate, I think everyone understands that principle. You have to shift that to the debate over the social services and the programs that are necessary.

Fifth, pass whistle-blowing legislation. There must be legislation. Currently in the Senate there is Bill S-13, a bill to protect workers who identify poor government practices. This is an important element in establishing public accountability. The 1997-98 senior management briefing book on the status of risk in HRDC clearly identified that 7 in 10 believed that there would be repercussions if they voiced concerns about ethical breaches.

Indeed, we have had members disciplined for speaking against the orientation of the department. The most notable is Ian Shaw, who works in the Scarborough Human Resources Centre. On October 26 and 27, 1996, he said that the department was cutting and that service was deteriorating as a result. The employer's reaction was to give him a two-day suspension and promise further action if warranted. It took two years to clear that up.

It is hoped that the honourable members of the committee will support the Senate bill, if adopted by the Senate—and, I'm sure, improve on it too—when it comes to the House of Commons.

It is unfortunate that it took an administrative audit to have a review of employment programs. Further, it is tragic that there was an aura of sensationalism around the issue. For example, a lot is based on the audit. The audit is an administrative thing to make sure that things are in order, but it doesn't test the worthiness of the programs or how important they are to Canadians and how they improve Canadian society. That's not mentioned in the audit at all.

This can cause our focus to move away from the importance of HRDC programs to Canadians and away from the dysfunctional work environment in which CEIU members have tried to maintain services to Canadians. It is in the spirit of our members' desire to serve the Canadian public that the CEIU is here to participate in this debate and work with the committee on improving the current system.

There are attachments. I've attached a list of 114 centres that were closed over three and a half years. More closures were scheduled in the Ottawa Valley, in places like Carleton Place, Perth, and Gananoque. They've all been put on hold this week, probably because of the efforts of the committee studying this.

• 1150

In addition, we have the surplus declarations, which indicate the number of members—and some excluded people—that were eliminated in HRDC: 5,403. That also includes the financial administration. This gives you an idea of the massive change in the workplace.

Lastly, there is a list of the numbers devolved to the provinces. There should be another addition—that of a number from headquarters who aren't indicated there—so the number is probably over 1,800. There were others that were pressing.... As you are all aware, B.C. will probably be making a decision after the next provincial election. Of course in Ontario all the talks are on hold for at least the next three years.

But that gives you an indication of the work environment. For example, for those three years in Ontario, those who worked in the employment service had no idea what they would be doing within the next month or the next year. That creates a lot of insecurity in terms of the work environment and makes it very difficult for our members to say “This is our workplace of choice.” They didn't know if they were going to be there any more because of devolution agreements.

Thank you very much.

[Translation]

The Chair: Mrs. Meunier-McKay and Mr. Pascucci, thank you very much.

[English]

Colleagues, as you know, we've agreed to finish somewhat early. I'm going to move this thing along and keep it moving.

I would remind the witnesses of the same thing. If I do interrupt you.... I will apologize now, but we're going to keep it going. You should know that I have to achieve a balance, not just between both sides but among the parties here and among the interests of individual members.

Colleagues, this is the list I have at the moment: Maurice Vellacott, Rey Pagtakhan, Libby Davies, Judi Longfield, Christiane Gagnon, Raymonde Folco, Jean Dubé, John Bryden, and Larry McCormick.

For the cameras, I will try to say precisely who is speaking. In this case, it's Maurice Vellacott.

Maurice.

Mr. Maurice Vellacott (Wanuskewin, Canadian Alliance): I want to thank our guests for being here.

First I will be addressing my questions to the individuals with Canada Employment and Immigration Union.

During his appearance before the committee here, the former deputy minister of the human resources development department claimed ignorance of many of the problems with regard to the administration of the department, particularly in regard to grants and contributions. My direct question, for which I'd like a yes-or-no answer, is this: do you feel that this claimed so-called ignorance is an appropriate response by departmental management?

Mr. Cres Pascucci: I think there's a contradiction in the remarks, because it's well on the record in terms of a number of our members indicating that there were problems in being able to deliver the programs and to deliver them effectively. Our members have been polled to death and audited to death. For example, Decima Research has done quite a bit, and there have been internal ones too. It would be very difficult to say that there was no awareness of the situation.

In support of Mr. Cappe—that's who you're alluding to—I think he was probably more concerned around dealing with all of the negotiations with the provinces around devolution and around the UI program rather than concentrating on employment. Because just—

The Chair: I would remind both witnesses and members to address their remarks through the chair. Let's keep it moving.

Mr. Maurice Vellacott: Right, Mr. Chair.

So I take it, then, that you don't buy that about not being aware of the problems, and that you feel, I guess, that there was or should have been an awareness of the problems of HRDC by the former deputy ministers. That's what I understand you to be saying.

Then I want to get to the next question about the whistle-blowing protection.

Mr. Cres Pascucci: I believe there are people in the department who could have advised him of these difficulties and could have done the appropriate things for what needed to be changed.

Mr. Maurice Vellacott: Do you know of or have you heard of instances in which one of your members has discovered and reported to his or her manager an instance of a financial mismanagement by a recipient of a grant or a contribution? Are you aware of that? Do you hear reports of that? Does that come up to your level within the union?

Mr. Cres Pascucci: We do receive occasional calls from members who do not wish to be identified and who indicate that while certain programs are being recommended to be rejected, the recommendations to reject are, however, being overturned by people higher in the management structure.

Mr. Maurice Vellacott: It would be overturned in their view or against their judgment because there's something wrong or inappropriate or it doesn't meet their criteria...? They suggest turning it down and yet they don't feel that's heard. Are you saying that they come to you but don't have whistle-blower protection?

Mr. Cres Pascucci: That's basically correct, as the one study indicates, and those are managers.

Mr. Maurice Vellacott: Right.

Mr. Cres Pascucci: The study indicates that 7 out of 10 feel there would be repercussions. I'm sure that in our membership that would be even more so. It's not just a question of whether or not you meet the criteria; the issue is whether it's going to be a good project. Let's say there's an evaluation at the local level that it is not going to be a good project. That can be overturned at a higher level.

• 1155

Mr. Maurice Vellacott: They will tell the manager that this is—

The Chair: Through the chair.

Mr. Maurice Vellacott: They will tell the manager, Mr. Chair, that this is not a good one to go with, and then basically they are set to just ignore it and proceed anyhow. Is that the kind of response that would come back to them?

Mr. Cres Pascucci: Mr. Chair, that's the response that would come back.

Mr. Maurice Vellacott: Okay. Are you aware of instances where your members in either the regional offices or at national headquarters have reported that they have been subjected to what we call “political pressure” to approve a grant or a contribution despite the fact that it doesn't fit within the parameters of the program? Do you get reports like that coming to you from your members or their managers because they don't feel they can go to somebody else?

Mr. Cres Pascucci: Mr. Chair, yes, we do, and it's a very common occurrence. I'd like to ask Brother Richards to comment on that as a program officer in P.E.I.

The Chair: Mr. Richards.

Mr. Jim Richards (National Vice-President, Prince Edward Island, Program Officer, Canada Employment and Immigration Union): Thank you, Mr. Chair.

I can comment that there is a concern on the part of the MPs in the ridings—and I've spoken to members across the country—that there's a very fine line between a member of Parliament wanting to know the progress of a proposal within his riding and urging that this project be accepted. I can say to you that very often these members do cross that line.

The Chair: You have time for a comment, Maurice. That's all.

Mr. Maurice Vellacott: So in some cases they do feel some unease about the involvement of a member of Parliament and “political pressure”. They obviously are not comfortable with that. If I understand you correctly, they feel they've crossed that line and have gone beyond meddling to political interference when they're trying to create this pressure to approve a project that maybe is questionable or dubious.

The Chair: Please give a very brief response.

Mr. Jim Richards: I can say that the members and the workers in the field are uncomfortable with that.

The Chair: Next is Rey Pagtakhan, followed by Libby Davies, Judi Longfield, and Christiane Gagnon. Rey.

Mr. Rey D. Pagtakhan (Winnipeg North—St. Paul, Lib.): Thank you, Mr. Chair.

If you have a sample of a total of 100 cases for the program in your area, when you say very common, how many of the 100 cases would have had these instances you referred to? Mr. Pascucci.

Mr. Jim Richards: Well—

Mr. Rey Pagtakhan: No, he was the one who said it was very common.

The Chair: Through the chair, is it Jim Richards?

Mr. Jim Richards: Yes.

The Chair: Mr. Jim Richards.

Mr. Jim Richards: It's difficult, Mr. Chair, to give percentages or numbers. You're saying 100. I come from a small region, but looking at the membership as a whole across the country, we have 15,000 members working in various programs. I'm not familiar with all of the areas, but I would say it might be in the area of 10% to 15%.

Mr. Rey Pagtakhan: Have you recorded all these cases?

The Chair: Through the chair, please.

Mr. Rey Pagtakhan: Mr. Chair.

Mr. Jim Richards: I think it's sufficient to say that all the cases are not recorded, but the union is aware of them.

Mr. Rey Pagtakhan: So there is no way for this committee to verify that information.

Mr. Jim Richards: Mr. Chair, I think we're dealing with confidential information and situations here, and I think in order to protect our members, we would not be specific in that regard.

The Chair: Rey Pagtakhan.

Mr. Rey Pagtakhan: Mr. Chair, in your presentation you indicated that students were being hired, and I got the impression that it is contributing to some of the problems. So my question is, in the problems identified by the audits, in how many cases were the jobs performed by students?

The Chair: Mr. Pascucci.

Mr. Cres Pascucci: Mr. Chair, what happens is that students normally backfill, in other words, do a lot of support work for a year in order to get some job experience. Then there's a process to try to get them into the workforce. This program has been there for two or three years.

Mr. Rey Pagtakhan: If I can interrupt, you have no actual documentation from the audit report that indicates that students had been the cause of the problem, do you?

The Chair: Mr. Cres Pascucci.

• 1200

Mr. Cres Pascucci: Mr. Chair, I never said that students were the reason for the fiasco. What I said was that in order to try to compensate for the lack of people working in the department, students are being hired instead of indeterminate people who can do the full complement of the job.

Mr. Rey Pagtakhan: To the public service group, with regard to the use of employees who do not meet the educational and professional standards as established by the Public Service Commission, you have challenged these cases. How many of the cases that you have challenged were successful before this quasi-judicial tribunal?

Mr. Merdon Hosking: I'll refer this to Greg since he has worked on these cases.

The Chair: Mr. Greg Gauthier.

Mr. Greg Gauthier (Director, Labour Relations and Negotiations, Association of Public Service Financial Administrators): To date our efforts have involved just a random sampling. Obviously this is a big exercise for a small association like ours. In about six departments we've been through, I would think the numbers are roughly 50 positions. We went through the Public Service Staff Relations Board, and we arrived at a solution whereby the departments admitted that in 25 or 26 of these cases we were in fact right, that the person who performed the duties didn't have the necessary degree and didn't meet the standard.

Obviously that leaves us with a bit of a problem because we're also concerned about the incumbents. These are long-serving public servants who have worked hard in the service of their country, and now through a technical administrative loophole, if I can call it that, and through no fault of their own, we've demonstrated that they don't have the requisite skills. The challenge for the public service is, what do we do with these people? What training efforts can be undertaken to bring them up to the level of professionalism and expertise that is required by the Public Service Commission and the Treasury Board?

The Chair: Rey, you have time for just a comment.

Mr. Rey Pagtakhan: What is the proper ratio for staffing and the type of work to be done? Do you have a sense of what is the proper ratio?

The Chair: Please be very brief, gentlemen.

Mr. Greg Gauthier: I don't think there's a ratio.

In fact, there are some initiatives. We're currently doing a study with Treasury Board to find that out, to look at private sector models as to what the ratio of financial people should be in an organization, whether it's in a large organization or in a smaller one.

I think our concern at this point is the efforts that will be made to advance the interests of the profession, to really focus on the key skills this public service and the government and taxpayers will need to ensure that money is properly accounted for. Let's invest in the public service, and let's invest in a professional financial community.

The Chair: Next is Libby Davies, followed by Judi Longfield and Christiane Gagnon. Libby Davies.

Ms. Libby Davies (Vancouver East, NDP): Thank you, Chairperson.

First of all, I'd like to thank the witnesses for really excellent briefs.

I think that anyone, including the government and the opposition parties, who fails to understand the impact of unprecedented cutbacks in the public service, not only in HRDC, is really missing the boat. In fact, when this first started, even the Prime Minister acknowledged the impact of the cutbacks.

I thought you made an excellent point about how red tape is being used as a smokescreen for basically throwing accountability out the window. We've heard a lot about red tape and that this was done to eliminate red tape. But I think the issue of accountability, which you're bringing forward, is very important.

I have two questions, if I can get them in quickly. The first one is with regard to the political environment. I did get a number of e-mails from Mr. Clancy, who is one of your members, about the political environment—what I would call a poisoned environment—that members have had to work in, where there is political interference. There was some coverage in the media of the situation he dealt with. I'm just wondering if you're aware of other instances, or in a general sense even, where your members are feeling the pressure of working in this very highly politicized environment where there is pressure to approve projects that may not meet guidelines and procedures.

Mr. Cres Pascucci: Mr. Chair, the first point I want to make is that if members of the committee want very specific instances and specific stats on the percentage of cases where there is political interference, pass the whistle-blowing legislation and you'll get it. That's the challenge I give you. If you want that information, pass the whistle-blowing legislation, and you'll get it.

I think it's unfortunate that in Mike Clancy's situation his only solution was to quit. Mike Clancy is pretty symbolic in terms of our membership. Our membership is committed to serving the Canadian public. That's why, for example, when they conduct a vote on the collective agreement and there's a result of a possible strike, the first question they usually ask themselves is, “Will that affect the service I give to my clients?” I think that's really important to keep in mind.

• 1205

Mike Clancy took it further. He challenged the manager. He challenged the management area in Kenora, and indicated there was a basic unethical practice in terms of the new orientation of the department. I have a quote from the union magazine in that regard. He said:

...it is in our self-interest

—“our” being the department—

under this structure

—the new programs—

to cut loose those who are a poor risk or likely to require more time to reach their goals because they are illiterate, or disabled, or women re-entering the job market, or among the working poor.

The Chair: Ms. Davies.

Ms. Libby Davies: My next question was going to be on whistle-blower protection, because when the Auditor General came here, I asked him specifically, in terms of the big audit they're now doing, what protection there would be for members within the department to freely come forward and provide information. He told this committee they would treat anyone who came forward with information with confidentiality.

I agree there needs to be whistle-blower protection, and when that comes forward I hope it's supported, but in the meantime, how are your members going to be protected? I'd like to suggest that maybe you should also be following up with the Auditor General, because he gave that assurance here publicly. We need to be assured of that, so if we're going to get to the truth of what happened, people who work in HRDC must have some confidence that they're not going to get absolutely hammered for speaking out.

I just wonder whether you've had any discussions with the Auditor General or whether you plan to follow that up.

The Chair: Ms. Pascucci, briefly.

Ms. Cres Pascucci: It's a good suggestion, and we will follow up.

Ms. Libby Davies: Okay.

The Chair: Thank you very much.

Judi Longfield, Christiane Gagnon, Raymonde Folco, Jean Dubé, and then John Bryden.

Mrs. Judi Longfield (Whitby—Ajax, Lib.): Thank you, Mr. Chair. My comments are directed toward Mr. Hosking and Mr. Gauthier. First of all, I want to thank you for a very thorough presentation and three very well-thought-out recommendations.

One of the comments you made distresses me greatly: the growing trend toward the use of employees in financial administration positions that do not meet educational and professional standards. The other is the presence of non-qualified individuals in financial positions. Hard work, willingness to take on a job, and corporate memory never compensate for lack of appropriate qualifications. I'm very concerned that we're not filling those spots.

I'm wondering if you can help. When we recruit to replace people who are leaving, how do we ensure we have the appropriate level of financial expertise in those day-to-day positions?

The Chair: Mr. Hosking.

Mr. Merdon Hosking: There is a selection standard in place that was developed by the Public Service Commission in consultation with the community. The goals of that are to bring professionalism to our group over a long period of time. That was established in 1987. Unfortunately there has been some pressure due to cutbacks again. People have to be placed. Unfortunately some people were placed in financial jobs, and our selection standard says they don't meet that.

Maybe as a community we have to look at long-service people who have learned on the job. Maybe there has to be some change in that. But they're not our rules; they are the rules established by the employer. Maybe we need some flexibility, and maybe we have to look into that. That's something we're willing to explore with the employer, because we're very concerned about these long-service employees who can do the job but just don't have the paper qualifications.

The Chair: Mrs. Longfield.

Mrs. Judi Longfield: You have three recommendations. In the first recommendation you say only qualified financial managers should hold financial management positions. You might want to add non-qualified individuals in any financial position.

In the second recommendation you talk about program delivery and monitoring, but you don't talk about program design. Do you feel there might be a role in the initial design of a program that would include financial managers as part of the integrated team?

• 1210

Mr. Merdon Hosking: We're evolving and we're going into modernization of comptrollership. We think our role is evolving and we're very concerned that our members need to be out learning the business—be closer. We're close now as advisers, but I think we have to weave ourselves into the fabric even further, so as the things are being developed, we're there giving the advice. I think we have to structure this thing and get it by Finance, to get their approval. We need to be there at the table when the initial decisions are being made, so we can give the advice immediately. It'll save everybody time.

The Chair: Mrs. Longfield.

Mrs. Judi Longfield: You're there at the end to clean up the mess, but if you were there at the beginning, those problems might be resolved before they actually occurred.

The Chair: Raymonde Folco, Jean Dubé, John Bryden, and Larry McCormick.

[Translation]

Mrs. Christiane Gagnon (Québec, BQ): You mentioned earlier that the department's plan was not substantial enough to offset HRDC inadequacies, that it did not necessarily ensure a good monitoring and that it did not prevent other situations such as the present one from happening.

For my part, I examined the detailed plan provided to us by the minister and, in several areas, found it lacking, especially in terms of financial accountability, of individual accountability and accountability with regard to set objectives. I do not know if you have this plan in front of you, but there is no mention in there of any code of ethics for workers for which anyone would be held accountable.

This has left me unsatisfied in the sense that accountability is given a very global meaning while, ultimately, as is the case here, no one will be held accountable, not the one who was big boss at HRDC, not the department and not the members of Parliament. In the end, there is no one accountable for the way things are done at Human Resources Development Canada. Can you see this? What in your view could be done to make this accountability materialize?

[English]

Mr. Cres Pascucci: Mr. Chair, thank you—

The Chair: I say it so the cameras know it's you; it's not to give you permission to speak. You can start whenever you like. By the way, speaking through me is not because of pride. We have found it's generally better if people do that.

Mr. Cres Pascucci: Okay.

We're on record as saying we think the six-point plan is an immediate thing to deal with the current situation, and in the longer term it won't change a lot. Basically you're saying “Well, we're going to audit better or we're going to have more reports, which are usually after the fact.” What you want to do is change the facts as they're being developed.

That's why we indicate that if you want real public accountability, you need to have people at the local level who can do the monitoring and deliver the programs. You also need to have services back into the employment centres in order to be able to control the central core duties. That would eliminate a lot of the necessity of these audits to verify facts that can't be changed after they're done.

[Translation]

Ms. Christiane Gagnon: You say that it is often difficult for you to go public with certain methods or procedures that you observe and would like to expose.

Point 6 talks of making public the progress reports. Do you not think it would maybe take some sort of grouping which would give it a certain transparency, a group that would have a fairly free hand without being concerned about being penalized by the minister or by the employees' supervisors?

Here again, I find that we do not go far enough because one can make all the internal reports one wants, but they will never be the ones wished by Parliament. In fact, when we, from the opposition, question the minister, we do not get these reports. In committee, we hear certain witnesses who could be useful speak gobbledygook and we know incidently what impact this will have on the long-term work.

• 1215

Don't you think there is some shortcoming in the way the information which could clear up everything is given out?

[English]

Mr. Cres Pascucci: I'll give you an example. We just got the annual report for 1999. It's a massive undertaking to try to understand that report and to put it into real terms, or what it means for the public.

I think probably the honourable members here have the same difficulty when they get the final report: What does that mean in terms of the projects in my particular riding? Were they properly administered? Was there results management in terms of the job creation? Because it's very difficult to do that after the fact.

I'll go back to my other point that these can be effected if we have the proper services in the centre that can be controlled and administered and if we have the numbers of people to monitor them. I'm not trying to give the impression that we should have over-administration, because I think that also is an error. There needs to be some flexibility. But I think the important thing is to change the facts at the beginning, because they can't be changed afterwards.

[Translation]

The Chair: Christiane, please be brief.

Mrs. Christiane Gagnon: Do you not think that one should first change the relationship between the department, the personnel and elected officials?

It is impossible to be more precise, whatever the framework or the action plan. Even with better management, you will not be able to expose all the tricks that can be used to obtain certain grants, as we have seen recently.

If things do not change, even if the plan allows for it, I see no transparency at all in terms of financial accountability or of what happens in the department, a transparency which would ensure that Parliament—

When reporting to Parliament, you are reporting to all members of Parliament, including opposition MPs. We are entitled to get clear answers on what is really going on. If only for those two reasons, I think that this plan is entirely inefficient, as you have said.

[English]

The Chair: Cres, briefly.

Mr. Cres Pascucci: I think it's important to note that there's been a lot of emphasis on the Transitional Jobs Fund, but a lot of other programs there don't involve the members of Parliament and are done on a regular basis.

I think there has to be a better system at the local level in terms of the deputy being able to deal with the issues there. I think that would be more preventive than what's being proposed in the six-point plan.

The Chair: Before I go to Jean Dubé, perhaps I could ask the Association of Public Service Financial Administrators about the action plan that was mentioned. Do you have any comment on the last exchange?

Mr. Merdon Hosking: We were very pleased to see that part of the action plan included better financial management. They are going to strive for that. We're there. Our experts are there. I think we're proud of the way they've come through this, but now we're looking to the future. We're hoping that we can work with them better on our skills for risk management, that we can get there....

Again, going back to working into the fabric of the department, we want to make sure we're there as things are being developed and that we can analyse the risks and give them the data they need to make very sound decisions.

The Chair: Thank you, Merdon.

Jean Dubé, then John Bryden.

Mr. Jean Dubé (Madawaska—Restigouche, PC): Thank you, Chairman.

Let me begin by thanking the witnesses for their constructive comments on looking at ways to fix the problem.

Mr. Chairman, I have a real problem today, hearing what these people have told us and what HRDC has told us. I think we're going to have to start swearing in people here. Comments were given here that there is political interference. When we hear the minister's office saying there's not political interference, it's completely contradictory and very damaging. I'll tell you, if we were in a court of law we'd have a serious problem with these testimonies.

Believe me, I thank you for your honesty here today.

I want to go directly to a comment by you, Mr. Richards, exactly on that political interference. You are in P.E.I., Atlantic Canada, not too far from my home province of New Brunswick.

You also stated here that there were complaints to your office of political interference. Was there political interference, and was there a lot of this, in P.E.I.?

• 1220

Mr. Jim Richards: I think what we're referring to is that complaints to our office...and I want to distinguish between my role as a representative of the members and my office, which is the place where I work. There were complaints to me as a union representative, but not just in P.E.I. Because our union is a national union, we heard these complaints from across the country.

As I said before to the member who asked me a similar question, there is a fine line here. I think probably everyone would agree to some extent that a member of Parliament has a right to ask about the status of such-and-such, or how this is going, or where this is in the process, but it's also quite another thing to urge and push forward the project of a particular proponent in a riding, which may or may not be politically motivated.

As I said before—with a quick glance to my colleagues—I think the figure was probably in the neighbourhood of 10% or 15%. Just as an off-the-cuff measurement, I think that might hold true.

I'm getting a nod from my colleagues.

The Chair: Ms. Meunier-McKay.

Ms. Jeannette Meunier-McKay: Just as a supplement to that, I think it's important for the committee here to realize the mechanics of the programs and what a program officer does.

Once they've assessed the contract, they make a recommendation to a committee. This committee then makes a recommendation to the minister's office. So there are a lot of processes.

A good example of some interference and where it comes from concerns the Metropolitan Toronto School Board. The program officer recommended to reject the contract, and there was a visit from Mr. Mel Cappe directly to Toronto. Our understanding is that he signed the contract.

Now, the contract fell through afterwards. Nonetheless, after the assessment by the program officer it was rejected, and then Mr. Cappe came up to Toronto and signed the contract. For whatever reason, it didn't materialize.

That's one of the examples where, through the privacy legislation, I'm sure you can get the lowdown.

Mr. Larry McCormick (Hastings—Frontenac—Lennox and Addington, Lib.): On a friendly point of order, Mr. Chair, I'm not sure which cap Mr. Cappe had on at that time, but I'm not sure that would be political interference.

The Chair: That's not a point of order.

Mr. Larry McCormick: Well, Mr. Chair—

The Chair: But on a point of information, Jeannette, which program are you talking about? Is there a particular program under which that grant was being dealt with?

Mr. Larry McCormick: On a point of order, Mr. Chair, when was Mr. Cappe elected?

An hon. member: Whose turn to ask questions?

Mr. Larry McCormick: I'm sorry, but....

The Chair: Go ahead. I'll go with that.

Ms. Jeannette Meunier-McKay: It was before he was elected. It was in 1998. Or...in this position he's in now.

The Chair: Jeannette, the point is, he's not an elected person.

Ms. Jeannette Meunier-McKay: No.

The Chair: Jean Dubé.

Mr. Jean Dubé: Thank you very much for that comment.

I want to go to the whistle-blower. I received a call from Atlantic Canada—and I'm not going to say which province—from a public servant who works on the front line at an HRDC office. I have a lot of respect for these people, because I work very closely with them in my riding in New Brunswick. They do formidable work. But they are very concerned, and we have evidence here, that if you talk too much you are disciplined. That's a fact. It's documented. I have some information coming from the Senate right now. I'm just waiting for it.

This person called me here in my Ottawa office and told me she received a call from Ottawa a couple of weeks after this fiasco started and was given some directives to review all the files in her office on the TJF and CJF. If there was anything missing in these files, she was to review them, fill them out, and backdate them.

• 1225

Have you ever gotten any comments from staff from any office in Canada on this directive by HRDC here at the central office?

Mr. Cres Pascucci: Mr. Chair, we've had similar directions from other areas, yes, but I want to make it clear that we don't have anything in writing. It's all verbal.

Mr. Jean Dubé: I also tried to get something in writing and that's the exact answer I got; it's not in writing, it's verbal. You are a representative of these people, and you do confirm with me that you've had comments on this directive given by HRDC officials here at the central office.

Mr. Cres Pascucci: Yes.

Mr. Jean Dubé: Thank you very much.

The Chair: Before we go to John Bryden, Jeannette, we understand the circumstances under which you're speaking. Under which program did the incident you described take place? Which program are you talking about? Are you able to say that? Do you want to say that?

Ms. Jeannette Meunier-McKay: I would rather, Mr. Chair, that you go through the privacy legislation to get the information.

The Chair: Very good. Thank you very much.

John Bryden.

Mr. John Bryden (Wentworth—Burlington, Lib.): Mr. Chairman, until Madame Gagnon used the word, we have not once heard the witnesses use the word “transparency”. Never have we heard that word, yet I would have thought that in the context of what we're talking about, transparency is very key to accountability. Indeed, it was transparency on the part of the minister, by releasing all these files, that created the situation where I discovered that in my riding there were projects going on in which half a million dollars was being spent completely unwisely. I was completely in the dark about this.

I would ask this of both sets of witnesses. Does the Access to Information Act work into your equations of trying to bring accountability to government departments and bring accountability to the type of work you do? Does the Access to Information Act have any role at all in what you do?

Mr. Merdon Hosking: A great deal of our members spent a lot of time replying to access to information requests, especially the ones that are financial in nature. Our members do their very best to get the facts as they can. Some of the questions are difficult to respond to because the—

Mr. John Bryden: You're not answering my question.

Mr. Merdon Hosking: Sorry, sir.

Mr. John Bryden: Does it have a role to play in bringing better management to government, either in its present form or in a revised form? It is truly remarkable that neither set of witnesses saw any place for the Access to Information Act in their testimony.

Mr. Greg Gauthier: Mr. Chair, I think in a sense when we talk about higher levels of professionalism and maintenance of that professionalism in the public service, when managers are studying these kinds of programs and grants and contributions, obviously there's an analysis done. There's risk analysis done. There's some concept of where these public funds are going and to whom and whether it is a good risk. If those documents are produced on a regular basis, obviously they're accessible through access to information. The public would have some sense that, yes, there has been a proper analysis of this money and where it's going.

Mr. Cres Pascucci: We took it for granted that this was the process. We aren't here to try to repeat what's already there; we're trying to improve what's there. That's why we didn't make any specific reference to it. The only reservation we have is that you don't always get the information you ask for. If it's a huge document, there's a huge cost to it, so it's not for free. Those are elements, but we just assumed that was already there as a process. Again, it's accountability after the fact.

The Chair: John Bryden.

Mr. John Bryden: I would like to get their reaction. What would happen then if all these government programs, all these documents we're talking about, became automatically available to the public because of changes in the Access to Information Act? Wouldn't that be far better than whistle-blowing legislation? Wouldn't it help if not just the MPs in the ridings could see these programs, but every Canadian could see these programs? Isn't this where we ought to be headed?

Mr. Cres Pascucci: I think departments try to use new technology to make up for the lack of people, and that hasn't worked. Let's put it in perspective. With the new Internet process and all that, you get more information on there. But these reports don't tell you everything; they're just reports. They don't tell you whether there has been any political interference or the number of programs and how much is spent.

Mr. John Bryden: It's not reports we're talking about.

• 1230

The Chair: It's a comment, John. There will be time for a response.

Mr. John Bryden: I'm not talking about the reports. I'm talking about putting the actual programs on the Internet so that I can see what's going on in my riding. I would hope this would be the best answer right now.

The Chair: Larry McCormick and then Bonnie Brown.

Mr. Larry McCormick: Thank you, Mr. Chair. Thank you to the witnesses for being here.

I appreciated getting a letter from the president of the union following one of the first meetings we had here. I stated then and I state today that in my opinion 99% of all the people, the staff at the HRDC offices I've touched in rural Canada, do a great job. Using one of my terms, they do go the extra mile.

I'm speaking not only for eastern Ontario. With government rural caucus, I touch quite a bit of rural Canada. It's unfortunate that people at the local offices have been tainted by a few bad apples, wherever they are, whether it's in a union or management or government or whatever. I just want to again say thank you for the good job you do.

You mentioned the freeze on the closing of the HRD offices in eastern Ontario. I'm glad we've achieved that. I certainly don't want to see any more offices closed in rural Canada. I think there's a difference between closing an office in one-quarter of the city of.... Let's pick on Hamilton or some place, where there's bus service, where there's transportation and services available. There's a great need to put more people back in the local offices for person-to-person delivery. In much of rural Canada we don't have....

You know, HRDC is a great department. I'm glad to have sat here for six years on this committee. But we're often looking too far into the future with delivering information to our clients. Much of rural Canada doesn't have access to the high tech you're talking about.

In some places HRDC offices have been closed or merged, and I want to get your comments on how successful this has been. I'm sure it can be good to merge them rather than close them, but I think we're often losing for the clients. I'd like to hear your comments on that, Mr. Pascucci.

Mr. Cres Pascucci: Well, I think it's the concept that the average citizen has. If you live in Toronto, you get service, but if you happen to live in Aurora, you may get service. It's that kind of comparison.

I think you've made a good point, but I want to make another point around even large centres. I worked for a number of years in the Dufferin and St. Clair office in Toronto. That was an Italian-speaking area and that was the Italian office. People came from all across Metro Toronto to that office because the services were good for that population. Well, that's gone.

So even in a larger community—it could be Winnipeg, it could be Vancouver—there are communities there and that's an integral part of having an employment centre in the community. The whole concept of having these services was to develop the community.

Mr. Larry McCormick: Thank you.

Mr. Chair, perhaps my point of order was unfair to the national executive vice-president, who is with us today. I do want to ask her something. Could we differentiate between the political interference versus interference by HRD central or management or third-party delivery? I'm sure Mr. Richards has had examples, but there is a difference between the types of interference. I just want to give you an opportunity to make any comments to clarify that.

Ms. Jeannette Meunier-McKay: There is a difference between interference by the upper management type and political interference. I think it's important to realize that all these contracts and everything go up the line. The interference by senior management is very prevalent in the local.

A lot of times what we've seen in the past was that we had insurance management teams go to employment management teams when they merged employment insurance, which used to be unemployment, and the employment side. So you had EI management teams that didn't know anything about employment programs and yet they were looking at approving programs or pressuring the programs officer to approve certain programs.

• 1235

The problem isn't just in this last couple of years, with the HRDC so-called fiasco. It goes back a good many years. So I hope it answers or clarifies that.

The Chair: Very, very briefly.

Mr. Larry McCormick: Thank you, Mr. Chair, for allowing that to be clarified, because we don't need the interference, and I hope all levels can work together better. But that's not political interference.

I wonder, Mr. Chair, if we should give Mr. Richards the opportunity to let us know what types of programs he's heard of where's there's been political interference—accusations across the country.

The Chair: If I might, we'll come back to that, because Larry will have another turn.

Bonnie Brown.

Ms. Bonnie Brown (Oakville, Lib.): Thank you, Mr. Chairman.

My first question is for Mr. Hosking. He talked about the lack of credentials amongst our financial managers, and when he first began to speak I thought maybe he was saying that in order to save money, we were hiring new people who didn't have the credentials. But then later in his discussion it seemed to me he was talking about older employees who never had the credentials, but over time had been promoted upward, so that now they're doing jobs that require these financial credentials. Is that correct?

Mr. Merdon Hosking: It's not through promotion; it was placing people who were going to lose their jobs through program review. People had to be placed. They had certain skills they had learned over many years, and they were placed in these jobs. Unfortunately they didn't meet the selection standards established by the employer, so the jobs were classified as other jobs.

Ms. Bonnie Brown: It was expediency. In order to keep somebody working, even if they didn't have the credentials, you plunked them in here because you needed a worker, even if they didn't have the skills.

Mr. Merdon Hosking: I think they had proven their skills over many years of experience and were capable of doing the jobs they're doing. But the rules established by the Public Service Commission say they do not qualify.

Ms. Bonnie Brown: Good, thank you.

Mr. Greg Gauthier: Just to clarify, too—

The Chair: Mr. Greg Gauthier.

Mr. Greg Gauthier: In the world of labour relations we say that classification is the mystery of the black arts. If you have a person who doesn't have a degree or doesn't have an accounting designation, then you just take the word “finance” out, and you call them a business planning analyst—it has nothing to do with finance; we're just looking at business plans.

We're not suggesting a grand conspiracy. This would require a lot of thought. But it is happening. It's not malintentioned; it's just a reality that people are being protected. As I said, the black arts dictate that if the person doesn't have a finance degree, don't call it a finance job.

The Chair: Bonnie Brown.

Ms. Bonnie Brown: I have another question.

It seems to me that in this downsizing, one of the ways the department tried to speed things up, do more with less, was to move from this command-and-control format, where there was all kinds of red tape and you had to keep moving papers up to be approved, to the empowerment of front-line staff.

My question to you, Mr. Pascucci, is whether it has worked, or is it simply now command and control under a regional or local manager? Have the front-line staff enjoyed any more freedom of movement? You say morale has gone down. It would seem to me morale should go up if indeed they had the empowerment that was supposed to flow from this change of management format.

The Chair: Mr. Pascucci, a fairly short reply.

Mr. Cres Pascucci: I wanted sister Boyd to respond, but I'll start off and say that there was a public service survey done in 1999 covering the whole public service, and one of the main criticisms the members of the public service who worked there had was that they didn't feel they had control of their jobs. So obviously they didn't.

Ms. Bonnie Brown: Somebody's in command and control, but not them.

Can I ask just one more question, Mr. Chairman? It'll be very brief.

The Chair: Very briefly.

Ms. Bonnie Brown: I'd like each of these people to tell me how long their regional manager or regional director has been in place, because we're worried about tenure here too.

How long has your regional person been in place?

The Chair: It would have to be a number.

Ms. Bonnie Brown: Just a number.

Ms. Jeannette Meunier-McKay: I think it's safe to say that I don't think too many of them have been there more than two, possibly three, years. There's a large turnover in senior management as well.

Is that what you're asking about, the turnover?

Ms. Bonnie Brown: For example, isn't the province of Ontario a region? How long has the person in charge of the province of Ontario been in that position?

Mr. Cres Pascucci: She's been there since the first wave of the cuts in 1991, so nine years now.

The Chair: It's Christiane Gagnon, and then Ray Pagtakhan.

Mr. Merdon Hosking: Excuse me, Mr. Chair, I just have to be excused for a few seconds and I'll be right back.

The Chair: By all means.

• 1240

[Translation]

Mrs. Christiane Gagnon: What Mrs. McKay just said concerning rotation, personnel change within the HRDC, reminds me of a conversation I had with an employee who for a long time worked in this department before being transferred elsewhere. He was telling me on the telephone that since then, he had been transferred from one branch to another every two years and ended up having a burnout because of the pressures of constantly having to deal with exacting cases of which he has insufficient knowledge.

Are you telling me that this is the case at HRDC? The employee I am talking about is presently working in another department. He was saying that by constantly going from one position to another—positions that require much knowledge and additional training—, he is unable to acquire the different skills required to do his job well.

[English]

The Chair: Ms. Meunier-McKay.

Ms. Jeannette Meunier-McKay: You're correct. I think when they rotate and they're there for two or three years, they go into a local office or even a regional office, and basically all they can do is manage the limited staff they have. They can't acquire a good basic knowledge of the community to be able to deliver some of these programs. They don't acquire a good knowledge of the community as well, and I think that can create a lot of problems.

There is no continuity in the managing of the staff as well. With the large staff turnover, in two or three years, or even four or five years, if you go into a community like Hamilton, how are you going to get a good sense of what's out there and what the needs of the community are? They have to rely on the staff, and because there's no rapport between the manager and the staff, it's quite difficult to have a good relationship and a good knowledge of the community and what the needs are. So it is very stressful.

[Translation]

Mrs. Christiane Gagnon: The problem is compounded by the fact that they are often evaluated by people who have received appreciation training only. Pressure seems to be very strong. They get very bad evaluations. That is what I was told by some. They are given a very low score on the monitoring they do. In some cases, a number of them have difficulty getting support from their union which it seems does not know how to defend their claims because they have such poor performance reports.

[English]

The Chair: Ms. Meunier-McKay, a short reply.

Ms. Jeannette Meunier-McKay: The union has always supported its members—let's be clear on that. I think the problem when they get a bad evaluation is that they are stressed to the limit. They don't have the proper resources to be able to apply the knowledge they have. I don't see that as a union problem; I see that as a management problem, a government problem.

The Chair: Next is Rey Pagtakhan, and then Morris Vellacott and Libby Davies.

Mr. Rey Pagtakhan: Thank you, Mr. Chair.

It is very disturbing that you claim 10% to 15% of instances have been associated with political interference. It is equally disturbing that more than 50% of the financial positions had been filled by individuals without the appropriate credentials. Did I hear you correctly?

Mr. Greg Gauthier: To respond for the association, that was a limited sample. Don't forget, this is a big exercise.

Mr. Rey Pagtakhan: I realize that.

Mr. Greg Gauthier: Out of those 50 jobs we looked at, we found that in those cases, 50% were misclassified.

Mr. Rey Pagtakhan: Did I hear you correctly?

Mr. Jim Richards: Yes.

Mr. Rey Pagtakhan: Thank you.

Mr. Chair, in this committee and in all committees, I have always had faith that all witnesses will give us forthright and honest answers, and I have no reason to doubt the figures you gave the committee today. But at the same time, there have been statements before by other witnesses, and I have no doubt that their statements were forthright and honest as well.

• 1245

So, Mr. Chair, I challenge the committee to request that the two witnesses provide us with the documentation to sustain their statements. Otherwise we will not be able to come to a real conclusion, particularly when the union's Mr. Cres Pascucci indicated in his concluding paragraph—

The Chair: We have a point of order.

Mr. Maurice Vellacott: The gentlemen already referred to whistle-blower legislation that would protect them.

The Chair: Okay, that's not a point of order. I know that. Thank you very much.

Carry on, Rey.

Mr. Rey Pagtakhan: Mr. Chair, the concluding statement from Mr. Pascucci was an elegant statement:

It is furthermore tragic that there is an aura of sensationalism on this issue.

An hon. member: Yes.

An hon. member: Absolutely.

Mr. Rey Pagtakhan: He continues:

This can cause our focus to move away from the importance of the HRDC programs to Canadians and away from the dysfunctional work environment where CEIU members have tried to maintain services to Canadians.

So here is my question, Mr. Pascucci: When you say “an aura of sensationalism”, are you implying that there is an element of more than the facts of the case? Yes or no?

Mr. Cres Pascucci: I think that's probably an understatement.

Mr. Rey Pagtakhan: Yes, but can you indicate who might have created this sensationalism?

Mr. Cres Pascucci: Well, we all have our opinions, right? But—

Mr. Rey Pagtakhan: In your opinion, who has created this sensationalism?

Mr. Cres Pascucci: I think the Ottawa Citizen has every one one of its reporters on this story, but that's just an opinion. Anyway, I think Arthur Kroeger, who worked as a deputy minister, wrote a very good article about this whole thing, saying everyone loses. He's quite correct in that regard.

Mr. Rey Pagtakhan: If I may interrupt you on the last point, only because of the constraint of time—

The Chair: This is your last point.

Mr. Rey Pagtakhan: Yes, this is the last point, Mr. Chair.

Mr. Hosking, you indicated in response to a question that there could be credentials that meet the standards required by the commission, while at the same time, from the other category, there is the proven knowledge and the proven skills to do the job without the credentials. Assuming that the credentials do not yet have the proven skills, yet you have before you the proven skills, which of the two sets of applicants will you hire for the given position to do the job for which the skills are required?

The Chair: Please respond very briefly.

Mr. Merdon Hosking: We would select the person who has the credentials in hand, and that is happening now as we speak.

Mr. Rey Pagtakhan: Thank you.

The Chair: Thank you, Rey.

Maurice Vellacott, then Libby Davies.

Mr. Maurice Vellacott: Addressing my question to Jeannette, in the case of the Toronto metro project, would it be some kind of requirement, or would you expect to find a written statement or rationale as to why the advice of other assessors was overridden by the then deputy minister? In those kind of situations in which there's an override by a deputy minister, is there a rationale stated, or is it just done and that's it, no more?

Ms. Jeannette Meunier-McKay: Well, I would hope there's a rationale as to why they approved it and overrode it.

Mr. Maurice Vellacott: Where in that situation was there some rationale, a statement to the effect of why it was overridden?

Ms. Jeannette Meunier-McKay: I would prefer that you went through the privacy route in order to get the whole file and all the documentation. I think your answer will be in there.

Mr. Maurice Vellacott: Right. I guess I'd ask this question then: Were there personnel who felt it was because “political pressure” had been brought to bear on the deputy, Mr. Cappe? Were there comments or statements to that effect from others who were close to the situation? Was it that “political pressure” had been brought to bear, and was that the reason for his override?

Ms. Jeannette Meunier-McKay: Through the chair, it is our understanding that the contract itself did not meet the criteria that they had to work with at the time.

Mr. Maurice Vellacott: I guess I'm asking if you had some comments, statements or remarks from individuals to the effect that political pressure had been brought to bear on Mr. Cappe, as the reason or part of the reason for the override of previous assessments.

Ms. Jeannette Meunier-McKay: I don't have the copies, no, I'm sorry.

Mr. Maurice Vellacott: Thank you, Mr. Chair.

The Chair: I'd like to go to Libby Davies now, colleagues, because, as you know, we're going to finish a little bit early. I'm going to keep it moving. Libby will be followed by Larry McCormick and John Bryden, and then we'll conclude.

Ms. Libby Davies: Since this whole issue came to light, we've heard this mantra of the six-point program. Everything's going to be corrected with the six-point program. I notice in your brief that you make in quite clear that you think it will just maintain the status quo. Obviously you've made recommendations about what we should be doing or what we should be taking up, but I just wonder if you have any sort of additional comment. I would direct that to Ms. Boyd, who hasn't had an opportunity to speak yet. Are there any additional comments that you wanted to make around what we should be doing or what we've discussed?

• 1250

The Chair: Molly Boyd, welcome.

Ms. Molly Boyd (National Vice-President, Ontario Headquarters, Program Officer, Canada Employment and Immigration Union): Thank you.

Actually, I probably would have a comment on everything that's been said, but I realize we don't have time for that. I would like to mention a couple of things, though.

It doesn't matter what political party is in power, all politicians try to influence us in some way, to some extent, although it varies. I don't think we should be just picking at one person or another. With regard to Jane Stewart, I have to say she is fairly new to the portfolio, and a lot of this stuff happened before she got there, so let's be fair about that, okay? I think she has a chance to do something that's positive right now.

The other thing is that we've been considered as not being accountable enough, and that's accurate because of a lot of different circumstances: changes in staff, overwork, not enough people, and so on. But what often happens is that when something like this comes to be, we end up again having too much red tape, so we go into overkill and all of a sudden have to account for every cent. That's just as bad as not having enough accountability, so that has to be measured very carefully.

Right now, the workers in my office are swamped—and I'm hearing this from other offices across the country. They're not allowed to take leave, they have to work overtime, and they have to be on call. They're going over old files, and they're going over files that have already been dealt with. Anybody who has an application in right now for present funding is on hold. That's a problem. We're also trying to close out our year-end, so that's a problem as well. There's also a new financial system being implemented, and they expect bugs there because it's a new system. All these things are adding to the workload.

Now, we are getting some new staff, but until they get the training, there's more work for everybody who's already there.

The other thing is that somebody—

The Chair: You'll have to be fairly quick, I'm afraid. Libby has just a few seconds left, and then we have to finish. I apologize for that.

Ms. Molly Boyd: Okay.

You talked about projects being pushed for funding. We have projects that we'd like to get funded, but which won't be funded because they're not considered to be cost-effective. For instance, one that I dealt with myself had to do with disabilities and the Canadian Association of the Deaf. It was very hard to get that pushed through because of the cost.

Yes, I think we are being unethical. We're helping the people who need the least help, and we're not helping the people who need help, because to do so would not be cost-effective.

The Chair: Thank you for that.

Libby, you have time for a comment, perhaps.

Ms. Libby Davies: I appreciate your comments about the minister, but I think the issue here is really the systemic problems within this department and across government. I guess I'd therefore ask you if you think the six-point program is going to deal with the problems that have been identified. Do you have confidence that the six-point program, which the minister and the whole government are resting their case on, are going to address the issues that we've been talking about today?

The Chair: This reply has to be very brief.

Ms. Jeannette Meunier-McKay: No, we think it's a band-aid situation and a band-aid solution. They have to look at a long-term solution, and we've provided them with our five-point plan that we feel will correct the situation.

The Chair: Larry McCormick, then John Bryden, and then we'll suspend.

Mr. Rey Pagtakhan: May I ask Ms. Boyd the same question as the last one, in order to have her answer.

The Chair: Your colleagues can pick it up.

Mr. Larry McCormick: Mr. Chair, I want to thank Ms. Boyd for putting forth some thoughts and for representing probably the views of the majority of Canadians, especially those in rural Canada. I know politics is politics, and probably every party has made sensational irritants, but the innocent people are the ones who are losing here.

Getting back to the political interference, just to give Mr. Richards an opportunity, under the contributions and grants—this is a political point that I'm making—many of these ridings that got the most money were in the hands of the opposition. But what types of programs were they? Were they just contributions and grants? Where did you receive the complaints about political interference, Mr. Richards?

Mr. Jim Richards: Thank you, Mr. Chair.

First, I want to say that by and large our union enjoys the support it has received from most of the members. But you have to let us do our jobs. That's what we're saying. Let us do our work.

• 1255

As for the programs, not all HRDC programs require MP concurrence or approval, or even consultation. Specifically, with the programs I worked on personally, I'm right in the middle of this. I've been working in TJF and CJF for the last two or three years. I'm in contact with many other people who are too. But the MPs are also involved in the consultation with regard to the summer career placements program. You've all probably had to sign off documents.

So those are—-

Mr. Larry McCormick: Signing off is not political interference.

Mr. Jim Richards: No, I didn't say it was, but there is consultation there, and there is juggling, and so on. What I'm saying is that I think probably most MPs support public services. There are some parties and some MPs that don't.

Mr. Larry McCormick: I appreciate the work you do, Mr. Richards. Not all of us do juggle, either.

The Chair: John Bryden.

Mr. John Bryden: If a politician asks one of your members to do something that your member thinks is improper, why doesn't the member just say no? What clout does the politician in his riding have with any bureaucrat?

The Chair: Mr. Richards.

Mr. Jim Richards: The members do say no.

Mr. John Bryden: Well, okay then—

A voice: No problem.

Mr. John Bryden: —they should say no all the time, surely. If they have any decent morality or ethic, why don't they say no all the time and end that political interference?

Mr. Jim Richards: They say no whenever they can. That doesn't mean it makes a lot of difference.

Mr. John Bryden: Then why can't they say no? What instrument does any politician have in his riding to force any of your members to do what he or she thinks is wrong? Tell me.

The Chair: Cres Pascucci.

Mr. Cres Pascucci: I think the key part—and I believe the honourable members all know this—is that the project officer is one level of the process. If the project officer says no, it can go somewhere else and get approved, so let's be clear on that.

The other thing to keep in mind is that as far as we're aware, the only person who seems to have a veto on those types of funds is actually the provincial representative. So there are mechanisms inside that go beyond the local project officer.

Mr. Larry McCormick: On a point of order—

The Chair: Go ahead if it's a point of order, and that's all.

Mr. Larry McCormick: I appreciate the information, and we're not attacking you, but again, that's not political interference.

Thank you, Mr. Chair.

The Chair: That's not a point of order.

Colleagues, in a moment, as you will recall, I am going to suspend, not end, the meeting. Then I guess we would have five minutes of business. I'm saying this to our members.

I'm going to thank our witnesses, and I'm going to suspend the meeting. We will stay here. People will leave and we'll carry on with next weeks' work.

But first of all, if I can, on behalf of the committee, I'd like to thank Greg Gauthier and Merdon Hosking, from the Association of Public Service Financial Administrators. We appreciate it, gentlemen; it's very kind of you. We appreciated the background information also.

I want to thank Jim Richards, Cres Pascucci, Jeannette Meunier-McKay, and the silent Molly Boyd, from the Canada Employment and Immigration Union. Thank you very much for being here. We do appreciate it.

Colleagues, the meeting is suspended for five minutes.

[Proceedings continue in camera]