OGGO Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Government Operations and Estimates

EVIDENCE

CONTENTS

Monday, February 24, 2003

Á

1110

The Chair (Mr. Reg Alcock (Winnipeg South, Lib.))

Mr. Steve Mahoney (Mississauga West, Lib.)

The Chair

Mr. Steve Mahoney

The Chair

Mr. Ken Epp (Elk Island, Canadian Alliance)

The Chair

Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance)

The Chair

Mr. L. Denis Desautels (Executive Director, Centre on Governance and Executive-in-Residence, Faculty of Administration, University of Ottawa, As Individual)

Á

1115

The Chair

Mr. Paul Forseth

Mr. L. Denis Desautels

Á

1120

Mr. Paul Forseth

Mr. L. Denis Desautels

Mr. Paul Forseth

Mr. L. Denis Desautels

Á

1125

The Chair

Mr. Robert Lanctôt (Châteauguay, BQ)

Mr. L. Denis Desautels

Á

1130

Mr. Robert Lanctôt

Mr. L. Denis Desautels

Mr. Robert Lanctôt

Mr. L. Denis Desautels

The Chair

Mr. Steve Mahoney

Á

1135

Mr. L. Denis Desautels

Á

1140

Mr. Steve Mahoney

Mr. L. Denis Desautels

Mr. Steve Mahoney

Mr. L. Denis Desautels

The Chair

Ms. Carolyn Bennett (St. Paul's, Lib.)

Á

1145

Mr. L. Denis Desautels

Ms. Carolyn Bennett

Mr. L. Denis Desautels

Á

1150

Ms. Carolyn Bennett

The Chair

Mr. L. Denis Desautels

The Chair

Mr. L. Denis Desautels

The Chair

Ms. Carolyn Bennett

The Chair

Mr. L. Denis Desautels

Mr. Paul Szabo (Mississauga South, Lib.)

Mr. L. Denis Desautels

The Chair

Mr. Ken Epp

Á

1155

Mr. L. Denis Desautels

The Chair

Mr. Robert Lanctôt

Â

1200

Mr. L. Denis Desautels

The Chair

Ms. Judy Sgro (York West, Lib.)

Mr. L. Denis Desautels

Ms. Judy Sgro

Â

1205

Mr. L. Denis Desautels

The Chair

Mr. Paul Szabo

Mr. L. Denis Desautels

Mr. Paul Szabo

Â

1210

Mr. L. Denis Desautels

The Chair

Mr. Ken Epp

Mr. L. Denis Desautels

Mr. Ken Epp

Mr. L. Denis Desautels

Mr. Ken Epp

Â

1215

Mr. L. Denis Desautels

The Chair

Mr. Roy Cullen (Etobicoke North, Lib.)

Mr. L. Denis Desautels

Mr. Roy Cullen

Mr. L. Denis Desautels

Mr. Roy Cullen

Mr. L. Denis Desautels

Â

1220

The Chair

Mr. Roy Cullen

Mr. L. Denis Desautels

The Chair

Mr. Robert Lanctôt

Â

1225

Mr. L. Denis Desautels

Mr. Robert Lanctôt

Mr. L. Denis Desautels

Mr. Robert Lanctôt

The Chair

Mr. Tony Tirabassi (Niagara Centre, Lib.)

Mr. L. Denis Desautels

Â

1230

Mr. Tony Tirabassi

Mr. L. Denis Desautels

Mr. Tony Tirabassi

The Chair

Mr. L. Denis Desautels

Â

1235

The Chair

Mr. L. Denis Desautels

The Chair

Mr. L. Denis Desautels

Â

1240

The Chair

Mr. L. Denis Desautels

The Chair

Mr. Paul Szabo

The Chair

Mr. Paul Szabo

The Chair

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CANADA

Standing Committee on Government Operations and Estimates

---

NUMBER 010

l

2nd SESSION

l

37th PARLIAMENT

---

EVIDENCE

Monday, February 24, 2003

[Recorded by Electronic Apparatus]

Á  (1110)  

[English]

    The Chair (Mr. Reg Alcock (Winnipeg South, Lib.)): Let us come to order.

    Before we move to our witness for today, let me just remind members of something. I've phoned around to the critics on the public service legislation from the various parties. What I would like to do at the conclusion of tomorrow's meeting is to have a quick business meeting to approve the list of witnesses on the bill so that during the two-week recess the clerk can arrange for those witnesses to appear on the bill.

    I also intend to call a meeting on Thursday--as I understand we're all here in town on Thursday for the vote on the budget--to hear from the minister on the bill, just to allow the minister to make her opening remarks, get the subject matter before us, and then the critics will have the two weeks to sort out how they wish to approach this. Okay?

    Mr. Steve Mahoney (Mississauga West, Lib.): Mr. Chairman, we've just lost quorum in the House. We have to go. The opposition has fled the chambers.

    The Chair: In the House.

    Mr. Steve Mahoney: Yes.

    The Chair: Just a moment here.

    One government member is the equivalent of three opposition members, I'm told. Is that not the case?

    Mr. Epp.

    Mr. Ken Epp (Elk Island, Canadian Alliance): If that's on a volume basis, you're still going to have a fight.

    The Chair: I know I should be careful with those things.

    Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance): It doesn't matter whether they're here or they're there; they don't listen anyway.

    The Chair: So if anybody wishes to discuss the issue of the witnesses and the like, perhaps you could see me right after the meeting.

    This morning we have Monsieur Denis Desautels, the former Auditor General of our government and now the director of the Centre on Governance, someone who all members know has had a long and distinguished career as our auditor and has been very helpful in encouraging this House in some of its management practices.

    We look forward to hearing from you, sir. I'll allow you to make your opening remarks. You know the routine; you've been here as frequently as or probably more than some of us.

[Translation]

    Mr. L. Denis Desautels (Executive Director, Centre on Governance and Executive-in-Residence, Faculty of Administration, University of Ottawa, As Individual): Thank you Mr. Chairman, and good morning to all committee members

    It's a pleasure for me to be with you once again to discuss subjects that are still close to my heart, even though it's been almost two years since I concluded my mandate as Auditor General of Canada. Furthermore, I strongly support the aims that you have set for this study and I wish you every success in your quest for solutions to ensure that our public institutions continue to be among the best in the world, in terms of their performance.

    I have had the opportunity to study the document outlining the aims of your study as well as the transcripts of some of your meetings, and I looked to both for inspiration in preparing the following remarks.

[English]

    I'd like to make a few brief observations on recent attempts at public service reform at the federal level, which may provide some elements for further discussion this morning.

    Judging from the document describing the study concept, the committee already has a good understanding of the factors that have influenced public sector reform around the world in the last two decades. I will therefore not review those in any detail this morning but will instead add a few brief comments on the characteristics of the federal government reforms as I've observed them during my term as Auditor General.

    Yes, it's true, as Mr. Ehrenworth pointed out in an earlier meeting, that the public management reforms that we've observed at the federal level in Canada were largely driven by the bureaucracy rather than by politicians. A possible exception to that might be the current efforts to modernize the management of human resources, which has the clear direction of the President of the Treasury Board and, we can safely assume, the support of the Prime Minister. This kind of clear direction can be very helpful at times in moving forward an agenda that is meeting resistance.

    However, it's also true that federal reforms were less influenced by political ideology than was the case in some jurisdictions. Rather, as one deputy minister once put it to me, the Canadian approach was a pragmatic, case-by-case approach. Well, one advantage, possibly, of that approach is the avoidance of the excesses that blind adherence to an ideology can bring. Conversations that I've had in the past with observers of the Australian and New Zealand scenes have alerted me to that danger.

[Translation]

    My next comment relates to political culture and its impact on certain aspects of the reform of public administration, particularly accountability and transparency.

    The federal public service has made laudable efforts to develop useful reports on the performance of departments and various federal organizations. But I think that we could profit even more from these efforts if it weren't for the fact that our political culture does not encourage transparency and objective accounting. This is not an easy problem to solve but we must come to grips with it if one day we wish to take advantage of reports that are both informative and balanced.

[English]

    This is rather unfortunate, because as I firmly believe, transparency and accountability lead, over time, to stronger institutions and they are essential if we want to make our institutions among the best in the world. Although Canadian reform, at least at the federal level, was not driven by politicians who did not respond to an overarching strategy or grand scheme, there were nevertheless very significant changes made in the 1990s.

    The following come to mind as examples of these changes: more prudent fiscal and budgetary practices, acceptance of accountability for results, implementation of shared governance arrangements, valid experiences in alternative service delivery arrangements, and more concern for and improvements in the quality of services to Canadians.

    But it's taking much too long to deal properly with some other important issues. I'm referring here to financial management and the modern comptrollership agenda; the management of large information technology projects; as well as questions like the role of Treasury Board Secretariat, horizontal management, and risk management. There has been some interesting discussion on these questions, but we need to move closer to some form of consensus.

    However, one of the most pressing issues that needs to be resolved soon is that of human resources management. It's not easy for politicians to get excited about such an issue, but I do hope the current efforts to modernize human resources management really succeed. This is important for Canadian taxpayers, and if the current efforts are not carried through to their successful adoption and implementation, it could be a long time before it in fact happens. This would make it very difficult for the Canadian government to attract, retain, and develop the kind of talent it needs to keep up with modern management techniques and help Canada compete and play its role fully in a globalized and fast-changing environment.

Á  (1115)  

[Translation]

    Mr. Speaker, I'll now be happy to answer any questions you may have. Thank you.

[English]

    The Chair: Mr. Forseth and Mr. Epp.

    Mr. Forseth.

    Mr. Paul Forseth: Thank you very much.

    I'm very pleased to see you're doing well, and even getting some national attention in the newspapers these days. There's life after circulating around these buildings here.

    I wanted to follow up a little on your comments about human resource management and modernization. You say it's very vital and very important. Perhaps you can provide the backdrop, very briefly.

    What does need to be fixed, seeing that you mentioned it as a high-priority item? And perhaps you could comment, does the current Bill C-25 go in that direction? Is it going to fix what you've identified?

    Underlying all of that, you'll notice in Bill C-25 the principle of “merit” being defined, I think, for the first time in statute, and we have a bit of national discussion about the viability and usefulness of this new take on merit.

    How does that fit into your mention of modernizing human resource management in the public service in the broadest perspective?

    Mr. L. Denis Desautels: Mr. Chairman, I think in answer to the first part of the question on what needs to be fixed, I would boil it down to providing deputy ministers and senior managers in the public service who are responsible for producing results more flexibility in making human resource decisions as well as more responsibility for those decisions. Right now the responsibility is split among a number of actors, and when it's split too much, I think it's very hard to hold anybody accountable. So I think there's a need to clarify the respective roles of all the major players, while at the same time providing a more flexible environment in which to operate.

    I hope that's clear enough. But in a few simple words, that would be how I would answer the first question.

    The second question had to do with the new bill, whether it will fix the problems. I think that's what you're asking me. I think the new bill will certainly go a long way toward doing that. I think what's advocated in the bill is a minimum. I think we have to at least go that far and not necessarily back off any of the proposals that have been put forward.

    There is a discussion in there on the merit principle, which is always a delicate issue. I think the direction the bill is taking on that issue is probably wise, and I think it will go some way in terms of providing a little more flexibility to the whole public service in terms of recruiting and attracting people in a more speedy fashion than was the case in the past.

Á  (1120)  

    Mr. Paul Forseth: In your years as the Auditor General, certainly we always talked about value for dollar, accountability to Parliament, and transparency in general. That seems to be in opposition somewhat to the interests of a ministry and its public employees to not talk to the public. There's nothing in the new bill that talks about the whole issue of what's known in the vernacular as whistle-blower protection.

    We have a long internal memo that talks about disclosure of wrongdoing and the duty of public servants to report wrongdoing through their hierarchy chain. I'm wondering whether in your long-term, overall perspective of the big picture that kind of internal memo really needs a basis in law for some recognition of protection for public servants who should report clear wrongdoing in this theme of transparency you're talking about.

    Mr. L. Denis Desautels: Mr. Chairman, whether or not the bill should include provisions dealing with whistle-blower protection is a very valid question. My understanding is that it basically has not been given a lot of focus in this bill. The reasons for that could be varied. One of those might be--and I don't know this; I'm just surmising here--that this is something that can be dealt with outside of this particular bill. It is a very touchy issue, and I think on its own merit it probably deserves a fair amount of discussion. But I would not want to hold up the whole discussion on reforming or modernizing human resources management because of this one very difficult issue. I think it probably can be handled outside of this particular bill.

    Having said that, I think one of the areas in which we have to keep working hard in the public service is the whole area of ethics and values. Whistle-blower legislation is part of that discussion, but the way I see it, whistle-blower legislation is the last resort in a properly functioning system. I think a properly functioning system must allow for dispute resolutions and the promotion of ethics all along the way, albeit providing some mechanisms for when that fails.

    But I would encourage governments generally to work as hard as possible on promoting a culture of ethics and values and having mechanisms for resolving early on disputes that may arise within government departments, recognizing that on occasion that may not be good enough and you may need a last resort like whistle-blower legislation.

    Mr. Paul Forseth: I have one last question.

    You talked about clarifying roles in the various segments of the public service. I think you were alluding to the Public Service Commission. One of the thoughts I put forward to you is that when you talk about flexibility, often people are thinking they're not getting a timely and quick response from the services of the Public Service Commission.

    The solution then is, instead of fixing the Public Service Commission, that you devise systems of delegation and rules to bypass the Public Service Commission or get it to delegate responsibilities to someone else.

    Part of what I call the “watering down” of the merit principle is, when you talk about needing flexibility, it's because we're not getting what we think we need from the Public Service Commission. It has an independent role to ensure accountability and independence for appointments, promotions, running competitions, and so on.

    What about this concept? Instead of trying to get around the Public Service Commission under the guise of flexibility, actually try to fix the real problem instead of “watering down” the merit principle.

    Mr. L. Denis Desautels: Mr. Chairman, I think I agree with Mr. Forseth's basic position. We should try to fix the problems where they really are, as opposed to coming up with devices that avoid some of the problems.

    One of the previous witnesses talked about, for instance, the Canada Customs and Revenue Agency being a good initiative. On the whole, I tend to agree that this new structure seems to be working. What I do regret is that the reason it was put together in that form was to get around some of the problems of hiring, staffing, classification, and remuneration that they were encountering.

    To solve the problem, we've taken them out of the main system instead of fixing the main system. I don't think that's the best way to go. I would hope, with the current human resources modernization effort, that it will fix the centre properly, eliminate the need for people to want to get out of the system, and perhaps bring back people who were let out of the system at some point.

Á  (1125)  

    The Chair: Thank you, Mr. Desautels.

    Monsieur Lanctôt.

[Translation]

    Mr. Robert Lanctôt (Châteauguay, BQ): Thank you, Mr. Chairman.

    Listening to you, Mr. Desautels, I realize that human resources management is a very important consideration. Once again, I come back to the question of horizontal management and all the problems associated with government organizations.

    By immediately passing Bill C-25, we are attempting to deal swiftly with all sorts of small points, particularly with respect to human resources. However, I believe the problem is far more extensive and more complex. It seems to me that we are starting at the end rather than at the beginning.

    We know that there have been horizontal management problems for the past 10 years with the new public management. We have been trying out different approaches but we haven't had many results; we saw the kafuffle over firearms and Human Resources Development Canada programs. We have a serious accountability problem and we are attempting to make small adjustments. I know that we have to start somewhere, particularly since the need for such changes has been felt for the past 10 years, but why not start at the beginning?

    Mr. L. Denis Desautels: Mr. Chairman, Mr. Lanctôt talks about horizontal management and it is something I also referred to in my remarks. Of course we must improve the management of issues that have an impact on more than one department.

    Based on my observations, I think that there has been a certain improvement in this respect, contrary perhaps to what others may have said. So I think the government is doing a better job today of managing issues that have a horizontal impact than it did 15 or 10 years ago.

    But it is far from being perfect and one of the issues that must be dealt with in relation to horizontal management is the role of the Treasury Board Secretariat. I also made reference to it earlier.

    The role of the Treasury Board Secretariat can be compared to the swing of a pendulum from one year to the other. At one extreme, the Secretariat was taking very little responsibility for what was happening in the departments and for the management of horizontal issues. Now, I think that the pendulum is swinging back a bit and the board is now ready to take on more responsibility for the management of horizontal issues.

    When we talk about reforming government management, we must put on the table the role of the Treasury Board Secretariat as the key manager of issues that have to be managed centrally. Moreover, I noted in the past that there was some confusion among Members of Parliament over the actual role of the Treasury Board Secretariat. When things started going wrong, as in the case you mentioned, people did not know who to blame and they would often pass the buck.

    So I think it would be useful for your committee to consider the horizontal management role of the Treasury Board Secretariat in the federal government.

Á  (1130)  

    Mr. Robert Lanctôt: Should another organization be responsible for overseeing all of this or is the Treasury Board Secretariat up to the task? Thus far, it's been very difficult for us to achieve results. When we attempt to touch a particular function, financial resource or budget, then the door is immediately slammed shut. We can see it in a number of files such as disabled persons or sports. This file is another case in point. When we want funding to be made available, we must first ask whether it should go to Health Canada, Heritage Canada or Industry Canada. Every time, we realize that the doors are shut simply because there is no communication between the departments.

    You tell me that the pendulum is swinging the other way and that some efforts are being made, but is enough being done? Would it not be preferable to create an organization above this one that would be responsible for management and would tell the departments that they have to do such and such a thing? When we ask them for something, the departments close up, they say that they have their own budget and they won't touch it. Should we rethink the entire organizational chart? This has been going on for several years now and the Treasury Board Secretariat is having difficulty handling matters. Otherwise, we wouldn't be in this situation.

    Mr. L. Denis Desautels: Mr. Chairman, I don't that we should create a new organization because we have enough of them already. What we need to do is ensure existing organizations do their job.

    In my view, parliamentarians must agree on the role to be played by the Treasury Board Secretariat. Once there is agreement on this point, then something must be done to ensure that this organization is equipped to carry out its work.

    Right now, I don't think the Treasury Board Secretariat has the necessary resources or expertise to take on the role that you would like to see it play. First of all then, I think you must clearly specify the role that you want to see it take on.

    Mr. Robert Lanctôt: But should that be its role? That should be its main role.

    Mr. L. Denis Desautels: If you look at the historical development of the Treasury Board Secretariat, you will observe that it has always been a central agency that, in the past, played a very direct and active role in the overall management of government, not only the management of the various departmental budgets but also the management of more horizontal issues. Towards of the end of the 80s and the beginning of the 90s, there was a slight shift away from this role, the secretariat making it known that it was relying on the departments for the implementation of programs for which they were receiving money.

    In the 1990s, Members of Parliament and even ministers called into question the true role of the Treasury Board. I would say that generally speaking, more was expected of the Treasury Board, more monitoring and more coordination of so-called horizontal or interdepartmental issues.

[English]

    The Chair: Thank you.

    Mr. Mahoney.

    Mr. Steve Mahoney: Thanks, Mr. Chairman.

    It's nice to see you again, Mr. Desautels. It's nice to see you back.

    I'd like to focus, if I might, on a couple of issues around crown corporations and arm's-length organizations within government. The suggestion is that they need to be more accountable.

    In fact, if you look at the Order Paper on any given day, you'll see dozens of questions going to Canada Lands, CMHC, Canada Post--questions asking for quite detailed responses. It would take a very long time to pull together the information. Yet these same organizations have been given, by and large, commercial mandates. I guess this has been done for reasons of downsizing government in terms of the overall impact on the taxpayer and enhanced efficiency in terms of service delivery.

    Canada Post is a classic example. I think it now owns 96% of Purolator, or more. CMHC turned an operating surplus last year, coming up close to $500 million, mostly from their mortgage insurance business, and it competes directly with GE Capital. Canada Post and Purolator would compete with all of the other couriers in the country.

    How can these groups become more transparent? How can they be required to comply with the same kind of accountability requirements that a department of government has, for example, and still be able to fulfill their commercial mandate on behalf of the shareholder, which happens to be the Government of Canada?

    How do we reconcile this? It's almost a dichotomy. On the one hand, we want them to go out and deliver the mail or provide mortgage insurance and do a good job, etc. Canada Lands' mandate is to add value and dispose of government property, which would involve competing in the development industry. How can they do this if they're subject to restrictions that their competitors are not? They're obviously going to be competing with a chain around their necks, so to speak.

    I wonder if you have any comments on that.

Á  (1135)  

    Mr. L. Denis Desautels: Well, Mr. Chairman, the whole area of the management of crown corporations is very interesting and important. I think the federal government has given itself what is a fairly unique framework for managing its crown corporations, which I think has served us well in the last 15 or 20 years that it has been in place. There are mechanisms for approving crown corporations' business plans, for making those available to the House and to Parliament generally.

    I think the framework in place for the management of our crown corporations is generally quite sound. Now, that framework, of course, puts a value on transparency and good accountability, which I don't think is too strenuous. I don't think it really ties their hands behind their backs in terms of doing what they need to do. I suppose you can go too far in terms of asking all kinds of details through access to information of what goes in crown corporations.

    Crown corporations should not be treated in the same way as government departments. If that were to be the case, you would not need to have the crown corporation; you would work through a regular department structure. The fact that you as parliamentarians have decided to set up crown corporations means you accept that they be given a different transparency and accountability regime than the actual departments.

    I think there are some examples of crown corporations, or organizations that have the same status, where they've shown that they can be transparent and still run their business properly. One example I could give you, which I think could be explored further, is the Canada Pension Plan Investment Board, which produces now quarterly financial statements and posts a lot of information on its operations on its website.

    In fact, I'm told that most of the requests it receives under access to information are unnecessary because the information is generally available on its website. I think CPPIB has actually gone much further than most crown corporations in terms of being transparent. This does not seem to have hurt its ability to carry out its mandate.

Á  (1140)  

    Mr. Steve Mahoney: I want to just take you back to your report in February of 2001, which is what flagged this for me. I must admit, I'm not familiar with the details of section 5 of the Financial Administration Act. One of your recommendations was that we need improved governance for crown corporations, increased transparency, and no exemptions from the accountability requirements of section 5 of the Financial Administration Act.

    There seems to be, again, a conflict there in terms of them not having exemptions that would apply to HRDC, for example, or some other operation totally within the realm of government. It's this age-old political issue of saying “Government should run like a business”. I've always submitted that if government really ran like a business, we'd probably be out of business fairly quickly. We'd certainly be out of a number of the areas in which we are involved, in terms of turning a profit, if you will. That's not the sole mandate of government.

    So how do we live with this conflict? And it's not only an issue for crown corporations; it could be other arm's-length agencies such as NavCan and things like it. We're not going to allow them to function in the competitive world of commercialization if we require so much transparency. How do we balance this?

    Mr. L. Denis Desautels: Mr. Chairman, I don't think, as I said earlier, the transparency and accountability requirements imposed on crown corporations at this point, with the current framework, are so strenuous that they prevent them from competing properly when they--

    Mr. Steve Mahoney: Sorry to interrupt you, but I got the impression that you were looking for more, in terms of accountability and lack of exemptions.

    Mr. L. Denis Desautels: I think you may be referring to--and I don't have it in front of me, I'm sorry--the fact that certain crown corporations are exempt from certain aspects of the Financial Administration Act. These include crown corporations that in certain cases have a cultural dimension and need to be even more at arm's-length from government than the rest of the crown corporations; and other crown corporations with a financial mandate, such as the Bank of Canada and the Canadian Wheat Board, which are exempted from certain provisions of the Financial Administration Act.

    I never really accepted the rationale for those exemptions. Those are not really very onerous. There are about a half dozen crown corporations that, if you analyse them, are exempt from certain provisions of the framework I was referring to.

    The Chair: Thank you very much.

    Madam Bennett.

    Ms. Carolyn Bennett (St. Paul's, Lib.): Thanks very much.

    In terms of the role of the Auditor General, why would there be any exemptions? All of what we do is government. I hear my colleague's concern about competitiveness, but aren't transparency and accountability part of good governance, whether they're in the private sector or not?

    I'm also concerned about what you think about the so-called boards we have of these things. A lot of boards have got into trouble in the private sector because they haven't really been transparent or accountable, even to their board members. Therefore the CEO has only given them the information to make certain decisions. I guess the whole rubber-stamping of boards seems to be a problem.

    If government were to set an example on this, how would it be different? How would our appointments to boards be different? How would the purview of the Auditor General be different? If we were going to start again, what would this look like?

    Why would you have exemptions and things like CFI, Inforay, or even the $50 million the Speaker looks after in terms of the Library of Parliament and all that? It must have bugged you, as the Auditor General, that there were certain areas you couldn't actually look at.

    If we're going to do whole-of-government results on things and look at how we're doing as a government, shouldn't we be measuring what's working and what isn't working, even in places where we send a lot of money in these so-called subcontracting exercises we do with the voluntary sector?

    We got out of core funding volunteer organizations because we said we couldn't measure what they were doing, so in this whole-of-government measurement of how we're doing and whether we're spending money effectively, how would you design it differently?

Á  (1145)  

    Mr. L. Denis Desautels: Let me try to answer that difficult question. First of all, Ms. Bennett referred to various exemptions of different organizations from the purview of the Auditor General, and obviously that did bug me at times when I was the Auditor General because I really did not accept some of those exemptions as valid reasons.

    On the other side, the government of the day that set those up made the point that they wanted to keep those organizations at arm's length as much as possible from government, and that included the Auditor General. For instance, the Bank of Canada is not audited by the Auditor General in order to give it the utmost independence from any government influence whatsoever. It's a question of degree.

    When they set up the Canada Pension Plan Investment Board that I talked about a few moments ago, it was the same issue. We wanted that organization to be completely at arm's length and free from any government influence. So even the Auditor General couldn't be the Auditor General of the organization. The same rationale was applied to the Canadian Wheat Board.

    I'm just laying out the two sides of the argument, even though I never really accepted those arguments.

    When you come to the other so-called arm's-length organizations that have been set up more recently, the various foundations, the moment you call them that, they are arm's length in the sense that the Auditor General should not be the auditor of them if they're at arm's length. You can't set them up as arm's length and still ask the Auditor General to audit them. We can question whether those are truly arm's-length organizations.

    I was glad to see that in the last budget that question was raised by the finance minister in the papers attached to the budget. It seems as though there will be further discussion on the accountability regime around those so-called arm's-length organizations.

    So I'm not a big fan of using those organizations to the extent they've been used in the last few years.

    Ms. Carolyn Bennett: We understand some of them were set up as sort of a practical solution to bilking dollars. Why wouldn't you just bring them back under the purview or the expertise of the Auditor General? Is that the definition of arm's length? If so, how would you create an accountability framework to allow the expertise of an office like the Auditor General to make sure these organizations were doing what they were supposed to do with pretty well only public dollars?

    Mr. L. Denis Desautels: As I said, if the argument holds that they are truly arm's-length organizations, then the government should not be able to impose its auditors on those organizations.

    One has to make a choice here. If members of Parliament feel uneasy about not having the same kind of access to what goes on in these organizations as they do for government departments, and not having their own auditors have a look at those on a regular basis, they should reconsider the extent to which they actually use that particular structure.

    As I said earlier, we can't have our cake and eat it too. If we really want truly arm's-length organizations, we have to accept the consequences of that.

Á  (1150)  

    Ms. Carolyn Bennett: This committee is sort of charged with having to look at all of that. What is your recommendation?

    The Chair: Thank you, Madam Bennett. It's a good ending question.

    Mr. L. Denis Desautels: I think these foundations that have been set up should not be used the way they have been to prepay future years' expenditures, which, as we all understand, was the main reason they were set up. The ones that have been set up are there. We should let them run their course, but we should be very cautious--in fact more than that. We should be very critical of any proposals to set up more of them and use that mechanism further in the future.

    The Chair: Excuse me, could I just interject a question here? When you say the ones that have been set up should be allowed to run their course, do you think the government should continue to give them money, over and above the block grants they've been given already?

    Mr. L. Denis Desautels: When I said let them run their course, I meant let them live with what they have and don't transfer any more huge amounts like we have in the past into those foundations. I'm making a political statement here, of course, which I can afford to do because I'm no longer the Auditor General.

    The Chair: You are free to make these statements now, Mr. Desautels.

    Thank you very much.

    Ms. Carolyn Bennett: Regarding the governor in council appointments to these boards, could we do that better? Are the boards doing what they're supposed to do, and as Auditor General, do you wish the board to have a better quality?

    The Chair: Thank you very much, Madam Bennett. I did screw up the timing and allow you to freelance in with that one. It's Mr. Epp's turn.

    Mr. Desautels, a very brief answer, please.

    Mr. L. Denis Desautels: The short answer is that Ms. Bennett is correct. We could do much better. We've laid out in one of my last reports, December 2000, how that could be done in terms of appointing members to boards of crown corporations and also how the role of boards in appointing the chief executive officers of crown corporations could be improved.

    Mr. Paul Szabo (Mississauga South, Lib.): Did you say appointing members of Parliament?

    Mr. L. Denis Desautels: Board members.

    The Chair: Thank you.

    Mr. Epp.

    Mr. Ken Epp: Thank you, Mr. Chairman, and thank you, Mr. Desautels. I always enjoy being the questioner when you are the witness. It's good to see you back here in a different role.

    Your successor has had some really big frustrations. I want to set this up.

    It seems to me the role of government is to provide services for the public good. All of the citizens send MPs to Ottawa, and they have an overriding responsibility to oversee the operations of government. Then within government you have a hierarchy of management, where different individuals are accountable to their superiors, usually in a hierarchical structure. The big change you look at is, are you doing what you should be doing, and in terms of what you've decided you are doing, are you doing it well? You have an evaluation question: are you getting value for money?

    Yet in your business as Auditor General--and that of your successors--and in our work as opposition members of Parliament, we tend to focus on things that go wrong. We ask the question of why it should go wrong. It's not dissimilar, I think, from the airline industry. When there's a crash, they have to get right down to it in order to prevent other crashes. That's why they do these in-depth investigations of accidents.

    In the last number of years we've had some really serious breaches in accountability. You talk about accountability and transparency, yet it's not there. The Treasury Board sets up guidelines and rules for letting contracts, for giving grants and contributions, and if these are followed, then presumably there's value for money returned, if it's found to be so. But when these rules are broken.... How do you build accountability into that system?

    I'll use a specific example. Let's say somebody gets a contract that really doesn't meet the Treasury Board guidelines, but there's a directive from a political boss that says try to arrange this; we want to get this thing done. So now that person has a dilemma. Does he obey the rules? Does he obey his political boss? Does he keep his job?

    How do you balance that?

    I mean, you're the whistle-blower, but that doesn't answer that question entirely. What's your response to that dilemma?

Á  (1155)  

    Mr. L. Denis Desautels: Mr. Chairman, we need, as I think I said earlier, to build into the public service management culture proper value and ethics rules that will guide public servants at all levels in the performance of their work.

    Now, we all know that something will happen sooner or later that will put this to the test, and that's when I think we need to make sure the structures we've put in place are adequate and will permit proper resolution of those issues.

    Mr. Epp used as an example, what's a public servant to do when he's told to do something that he knows goes against the basic contracting rules of government? That is a very fundamental question.

    As far as I'm concerned, there has to be in place, in every government department that does contracting, some mechanism for resolving different points of view or disputes on the propriety of a particular decision. I don't think public servants should be necessarily left out to dry, and I don't think whistle-blower legislation should be invoked immediately in those situations. As soon as they happen, they have to be dealt with in a responsible fashion. So I think all departments should have mechanisms to resolve disputes immediately when they happen.

    Now, again, no system is foolproof, and maybe you need to have mechanisms that go even further when the first line of defence doesn't work. We don't necessarily have that in place right now in government departments, and I think every department should be asked what they do have in place to deal with exactly the kind of situation you're describing.

    The Chair: Thank you, Mr. Desautels.

    Mr. Epp, we're on the second round now, so we'll come back to you again.

    Mr. Lanctôt, three-minute rounds. Short questions produce more answers.

[Translation]

    Mr. Robert Lanctôt: Thank you, Mr. Chairman.

    Continuing in a similar vein, we put questions to ministers when they appear before the different committees. How can we obtain information, whether it be from a deputy minister, an assistant deputy minister or even other people in the organization? When we talk to them in private, in Parliament or elsewhere, they tell us that certain things are not being done properly, according to the rules. But when we ask them questions in a committee, these people will not give us the same answer. They tell us to put the question to the minister. How can we compel these people to speak if there are no laws to protect them in the case of such denunciations?

    I know that at the beginning you answered that we could perhaps come at this problem from a direction other than Bill C-25, but I don't understand why. If we are in the process of restructuring the system and providing a new framework for these people, then we must do a thorough job and do it immediately. If we want to give them responsibilities and a leadership role to play, then they must also be given a chance to say what is not working. They shouldn't say that they know it doesn't work but the question will have to be put to the minister because it is a question of policy, or that they don't really have the information, when we know that they do have this information. They don't want to talk about it when they come before our committees as witnesses because they are afraid of losing their job or of being transferred.

    Mr. Desautels, when you say that this problem should be settled outside Bill C-25, I don't understand. It seems to me provisions should be made for this in this bill, just as we are in the process of establishing new parameters in Bill C-25.

  (1200)  

    Mr. L. Denis Desautels: Mr. Chairman, I think it's a question of legislative strategy. I think it's unfortunate that we have been hearing for so many years now that it is necessary to reform or to modernize human resources management in the public service. I think that this will have to be done as quickly as possible. The opportunity that we have now is unique. If we are not successful in modernizing human resources management now, then I think that we will have to wait a long time before another opportunity presents itself.

    I do not under-estimate the importance of the question you have raised. However, if you are comparing this question to the overall issue of human resources management, then I think that it is only one element among many others. I would not like to see this bill held up because of this point because there are other ways of dealing with this problem.

[English]

    The Chair: Thank you, Mr. Lanctôt.

    Madam Sgro, and then Mr. Szabo.

    Ms. Judy Sgro (York West, Lib.): Thank you. It's nice to have you here as well to hear some of your comments on these issues.

    For the role of parliamentarians when it comes to our ongoing relationship with the bureaucracy, and for the role of parliamentarians overall, how can we be more effective?

    We now have this committee as a standing committee that I think is excellent. You're completely at a position now where you can make comments on how we can be more effective as parliamentarians in carrying out our role.

    What suggestions would you have for us to do that?

    Mr. L. Denis Desautels: Mr. Chairman, one of the things that I've learned in ten years as Auditor General was the importance of parliamentarians holding the government accountable, along with the second principle, which is that accountable organizations on the whole end up performing better.

    I think parliamentarians have a very fundamental role in holding the government accountable for the management of government programs. I think that requires a lot of work because it's complicated. The information as to how things are going is not always easy to obtain.

    I think the various committees, in my view, have to equip themselves with the right resources to supply the information they need to do the work properly.

    I think they also have to spend more time than they have in the past in terms of analyzing the estimates that are tabled by each department. I understand your committee will be doing some of that.

    One of the discouraging things that I saw as Auditor General was the little time that was spent by parliamentarians on going through the estimates. One of the fundamental responsibilities of members of Parliament is to approve the spending. To approve the spending, I think you need to understand in a fair bit of depth what the spending is all about.

    These are two areas, I think, where members of Parliament can become more effective.

    Ms. Judy Sgro: How do we improve the relationship between public servants and parliamentarians?

    There seems to be a real lack of trust and understanding of each other's role. We heard that in testimony. I think it's fundamentally important for moving forward on parliamentary reform.

  (1205)  

    Mr. L. Denis Desautels: Mr. Chairman, if that is what's happening, I think it's quite unfortunate. In my role as Auditor General, I've always paid the utmost respect to members of Parliament, and I have tried to answer their needs promptly whenever they needed information on one thing or another.

    I think all government departments should have a similar attitude. I think members of Parliament are on top of the whole apparatus, as far as I'm concerned, and need to be treated in that way.

    The Chair: Thank you very much.

    Mr. Szabo.

    Mr. Paul Szabo: Thank you.

    Mr. Desautels, Robert Marleau, the former Clerk of the House of Commons, wrote an interesting op-ed piece for The Hill Times. He indicted parliamentarians for ignoring 50% of their job, and that was the review of the estimates. Eighty per cent of committees do not review them, but by our rules they're deemed to be reported to the House.

    I've been on a couple of committees that actually have done some sort of a review. For those ones that do them, it turns out to be more of a question period for the opposition to try to get political points when a minister is here. A lot of that probably could be stopped by having a chair who keeps the focus on the estimates and not on the politically sensitive spots of a departmental operation.

    Do you agree with Robert Marleau that the parliamentarians have not been doing their jobs properly and in fact are missing an opportunity?

    Mr. L. Denis Desautels: Mr. Chairman, as I answered to Ms. Sgro's question as well, I do believe that's an area where members of Parliament have not been as effective as they should have been, and it's one that I found discouraging in my tenure as Auditor General. So I would hope that ways will be found to correct that, but I know we've been saying that for a long time as well. So it's like waiting for Godot. I don't think it's going to happen automatically.

    I do think, however, we have to understand better why it is that members of Parliament have not paid more attention to the estimates--I think there are fundamental reasons why this is the case--and try to deal with those reasons and perhaps increase the appetite or the incentive that members of Parliament would have to spend time on the estimates.

    Mr. Paul Szabo: I guess the only other thing I'm going to have time to talk about is maybe to explore a little bit your opening comments with regard to the human resources side of the equation, the ethics and values within the civil service, the ancillary stuff like whistle-blowers and dispute resolution, and so on.

    The public service has often been complimented as being very solid and very effective, and we always celebrate a number of aspects of it. But when you consider, I think, the last Auditor General's report, which identified a significant problem in hiring practices, being able to attract and to keep good people, and in fact that the process of hiring full-time people was so onerous that the public service was relying on contracts and part-time people because it was easier to do the paperwork, when you see indicators such as that, you wonder whether or not there is an environment of human resources management that maybe has not developed the incentive on behalf of those, whether it be for possibility of merit, performance measures, and opportunities to move ahead, that the system is not an environment that is conducive to the efficiencies and maybe the safeguards that auditors general have been clamouring for, for years.

    So is the environment for our civil servants faulty in its foundations, because it's easier to get around or to get to where you want to go by doing it in maybe less efficient ways?

  (1210)  

    Mr. L. Denis Desautels: I think traditionally it can be said that the Government of Canada has put in place a professional, neutral, and competent public service. Despite all the criticisms that I would have levelled myself in the past about the different aspects of government management, I do have respect for the public servants I've dealt with over the years.

    There are right now, and this has been the case for the last few years, real problems in hiring public servants, maintaining the quality of the public service, and replacing those who will be leaving in the near future with equally competent people. I brought those out myself when I was Auditor General, and Ms. Fraser has, since then, come back to that issue.

    When you say the environment may not be conducive to good public or human resources management, that is true. That is why we need to deal with it, and deal with it very quickly, not just to make public servants happy for their own sake, but I think in the end we would all benefit from having a public service that functions really efficiently.

    So I think we need to change the way we hire, the way we promote, the way we remunerate, the way we classify, and the way we move people around within government, in a major way, in order to make it an environment that is conducive to promoting the best and making sure we hire people who will replace those who will be retiring.

    The Chair: Thank you, Mr. Desautels.

    Mr. Epp, for a three-minute round.

    Mr. Ken Epp: Thank you again, Mr. Chairman.

    I can't help but believe that in the civil service--this is a straight estimate, a guess--99% of the civil service want to do what's right. They want to be, honestly and forthrightly, good stewards of the taxpayers' money. There may be 1% that would do otherwise.

    But the question that I still have to come back to is, when there are abuses, what recourse can we actually have? For example, I've become aware that CIC has contributed to the gun registry program. What on earth...? How could that happen?

    That's just a case where they have extra money, the money is wanted, and somehow it gets transferred over in violation of any Treasury Board guidelines. How can such a thing happen?

    Mr. L. Denis Desautels: Mr. Chairman, I'm not aware of that particular possibility. I would be very, very surprised if it did happen, because I don't see how it could happen within the rules.

    In any case, just to come back to the more fundamental question, if I may, I think all government organizations, including crown corporations, must have in place mechanisms that allow people to actually bring up right away problems of conscience that they have with particular transactions, so that they're dealt with immediately within their organization. If they can't be deal with within the organization, then they should be able to appeal to a higher level, but I think it's important to have in place mechanisms right now that allow people to do that.

    Mr. Ken Epp: But what if the higher level has said this is what we want done?

    Mr. L. Denis Desautels: There's always again a higher level. If the highest level within the organization can't deal with it to everybody's satisfaction, you should then be able to go outside the organization and get a more independent point of view at that point.

    Mr. Ken Epp: So should there be a formal process in place? Presently, I don't think there is.

    I think civil servants, sometimes against their will, are being cajoled into doing things they question, but they do it in order to preserve their job and to obey their supervisors, which is part of their mandate. I think there is presently no way out for a person like this.

    Should there be a formal statement in Treasury Board guidelines that says to all the employees that if such a thing happens, they now have an obligation that supercedes all the others and they are going to be kept harmless from any repercussions of it?

  (1215)  

    Mr. L. Denis Desautels: There have been a number of efforts or initiatives tried in various government departments, going back three or four years, I believe, where this started becoming more and more serious. I think it would be useful to see exactly where that is at, at this point in time, because I know of some government departments that have done exactly this. They have set up structures for promoting ethics and values, and also resolving disputes when they do occur. I also know that at a higher level the Treasury Board has set up a function that is supposed to take care of issues that organizations can't take care of themselves.

    So I'm not sure exactly where all those efforts are at this point in time and what they add up to, but I think it would be worthwhile finding out exactly where it's at and whether or not that's satisfactory to members of Parliament.

    The Chair: Thank you, Mr. Epp.

    Mr. Cullen.

    Mr. Roy Cullen (Etobicoke North, Lib.): Thank you, Mr. Chairman.

    Thank you, Mr. Desautels.

    I want to talk briefly on the question of whistle-blower legislation, and then I want to get to some systemic issues within the public service.

    Does the Office of the Auditor General, right now or when you were Auditor General, receive a flow of information from the bureaucracy indicating problems? Is everything the Auditor General comes up with a result of just hard audit work, or do you get tips from the bureaucracy?

    Mr. L. Denis Desautels: The Office of the Auditor General does get brown envelopes and does get calls or straight letters from people who have a problem with a particular situation. It is set up to analyse properly all those communications and decide to what extent they are serious and need to be further investigated.

    Mr. Roy Cullen: So that's already happening. Do you think that whistle-blowing legislation would increase the flow?

    Mr. L. Denis Desautels: Well, it could increase the flow. The office has set up proper mechanisms for handling such situations. What the office cannot do is protect the person's anonymity to the end if matters go in a certain direction. So to that extent, then, people might be perhaps a little hesitant to come forward because that is not possible. But that doesn't prevent a certain number of other people from sharing their concerns with the office.

    Mr. Roy Cullen: Sure, thank you.

    Over the last few years we've had a number of high-profile management guffaws, if I can call them that--the jobs programs at HRDC, the sponsorship programs in Quebec recently, the gun registry. It seemed that in most cases there was not the adequate due diligence.

    I'm wondering if they indicate something more systemic, a problem within the public service, within the Government of Canada, within the governance model. Or is it just that this is big government, that you're bound to see big mistakes? I have difficulty with that, especially with some of those because they ended up costing perhaps not as much as was reported in the press or by the opposition, but still it wasn't the best use, that's clear, of taxpayers' money. Is it that we have fewer people to manage resources, programs? Is it that we've lost some management talent? Is it responding to political direction that may be a little overzealous?

    What's your take on it, Mr. Desautels? Is there something systemic going on or not?

    Mr. L. Denis Desautels: It is difficult, Mr. Chairman, to find a systemic common thread to the events that you just described. When you talk about the HRDC situation, about the sponsorship program, about the gun registry, as far as I'm concerned, they're very different situations.

    If there is a common thread to these, it would be one of values, and the value in particular of ensuring that the taxpayers' money is spent with due regard for economy, efficiency, and integrity.

    I think it's fundamental that when you're spending public money, you're spending trust money.

    In those situations there was a slippage of one kind or another, and I think this notion of spending trust money was perhaps forgotten by some people.

  (1220)  

    The Chair: One more short question.

    Mr. Roy Cullen: Okay, thank you.

    I know my experience is more at the provincial level, and the Treasury Board Secretariat plays a much more prominent and assertive role with respect to resource allocation and decisions of the government. Ottawa tends to be a clear demarcation in terms of line and staff, ministerial accountability. Others would argue there's too much political correctness involved.

    I know at the provincial level, where I worked, the Treasury Board was well briefed by the secretariat. When ministers came in looking for resources, they had a fight on their hands if they had any sort of slack in the system or if the goal-setting was soft or mushy.

    I'm wondering if the Treasury Board Secretariat could play a more prominent role in the resource allocation process. What role are they playing now?

    Mr. L. Denis Desautels: Well, Mr. Chairman, they're still very involved in terms of setting, for each department, the level of funding that the department is going to get for its various programs...and also for special projects that the departments may want to carry out. So they're very much involved in the resource allocation side.

    They may not be quite as involved in the phases after resource allocation and resource decisions. By that, I mean ensuring that all of those projects are carried out successfully, that cross-departmental issues are properly taken into consideration, and so on. So they have been playing in the last few years, to use your own words, a less prominent and assertive role in actually carrying out particular projects and programs.

    I admit it's a delicate exercise, because you need to have the right kind of head office concept, but you also want to treat individual departments like big boys and girls. On their own, they are large entities, they manage huge sums of money, and they have tens of thousands of employees. So you can't hold their hand all the time either. You have to have a proper understanding of the amount of autonomy they have and if and when you might come in, as the head office, to exercise your own responsibilities or prerogatives.

    The Chair: Thank you, Mr. Desautels.

    Mr. Lanctôt.

[Translation]

    Mr. Robert Lanctôt: Mr. Desautels, this will probably be my last question.

    We saw what happened last week with respect to the firearms registry. There is still a problem of accountability and in this respect, we have been asking questions of the minister in the House. Often the minister will change seats so as not to answer the questions. Now, it's going even farther, it isn't the minister who is changing seats, it is the issue that is being handed off to another department. It seems to me that we're going to have trouble in the coming weeks and months getting answers to the questions that we are entitled to ask, answers that we should be getting.

    It seems to me that this change we have observed is very far reaching. When we ask questions of the Minister of Justice in the House, he will answer us that it is no longer his responsibility, it is the Solicitor General who is looking after this file. But we know that all the problems were related to the Department of Justice. And when we ask questions of the Solicitor General, he will answer that he was not aware of these problems because it wasn't his department's responsibility at the time, that he is unaware of the mistakes that were made, that he does not know whether these mistakes were made by officials or as a result of the system not working properly.

    It seems to me that things have come to a pretty pass indeed when very significant facts about the register are being hidden. For Quebeckers, it is obviously important to have a firearms registry but when we see the kind of financial mess this has created... It's a complete fiasco and we are probably going to have a lot of trouble getting answers to our questions.

  (1225)  

    Mr. L. Denis Desautels: Mr. Chairman, I cannot comment on the firearms issue because it is not something that I was involved in as Auditor General. I don't know the exact reason why responsibility for this file is being transferred from one department to another. However, until someone can prove otherwise, I hope and I trust that this is not an attempt to avoid accountability or being held to account. In my estimation, the fact of transferring certain responsibilities for this file from one department to another should in no way diminish the accountability or the transparency of such operations in the future.

    Mr. Robert Lanctôt: Why was there no provision made for this kind of situation? We know that we cannot call to account a minister who is no longer responsible for an issue. Should there not be a transition period when this kind of thing happens? Let's take the example of the Minister of Justice. Would he have been able to maintain some responsibility for this file until the transition was completed? If the Solicitor General answers that it is not his file, that he doesn't have an answer, etc., why can't the former minister be questioned directly about it? Would that be possible? What do you think?

    Mr. L. Denis Desautels: Mr. Chairman, I am not in a position to answer this question. It is something that comes under the Standing Orders of the House. It is a question with a legal dimension and personally, I am not in a position to suggest solutions to problems you might anticipate. I honestly hope that the change that was announced will not diminish in any way the access to information which members of Parliament wish to have.

    Mr. Robert Lanctôt: Thank you.

[English]

    The Chair: Thank you, Mr. Lanctôt.

    Mr. Tirabassi.

    Mr. Tony Tirabassi (Niagara Centre, Lib.): Thank you, Mr. Chair. I would like to begin by welcoming Mr. Desautels to the committee to speak to us on this topic.

    My question deals with the widely, not wildly, held opinion out there between employees in the public sector and employees in the private sector. We know there's been criticism that we have difficulties in recruiting and retaining quality employees and keeping them satisfied within the public sector because of a lengthy, cumbersome hiring procedure, and such programs as the wage freeze didn't do anything to help. As a result, we lose quality employees to the private sector.

    I'm wondering if you can comment on that. And if that is the case, is there any actual evidence to show that this is indeed the case? If so, is there any evidence to indicate that in large private corporations, because again we have to keep that in mind...I think part of it is that the government is the largest employer. So comparatively, to a large private company, is there any evidence to show that there's a great deal more satisfaction and productivity in the private sector?

    Mr. L. Denis Desautels: Mr. Chairman, let me first say that HR management in the federal government is much more complex and lengthier on the whole than in well-run, large, private sector organizations. I would venture to say it's two to three times more costly than it is in well-run, large, private sector organizations. This tends to have an impact on people in the system, who may get discouraged with the lack of speed.

    I think all of this is unfortunate. It's also unfortunate that the recruiting can't be more effective, because the government might be losing access to some really good talent, to people who would be interested in working in a governmental and public environment.

    Let me add one last thing. Having a pretty good knowledge of the private and public sectors, I would say the public sector, and particularly the federal government, offers some very, very interesting work, which is very motivating on its own and which should be a factor helping to attract good people to the federal government. On the whole, I think remuneration is not bad. The kind of work people do can be extremely interesting, so these positive elements are there. So let's deal with the other elements making it difficult for people to come in and enjoy these particular benefits.

  (1230)  

    Mr. Tony Tirabassi: I have just a quick follow-up question. Given that you've had an opportunity to review Bill C-25, to what extent in your opinion does it go to helping to resolve some of these issues?

    Mr. L. Denis Desautels: As I answered at the beginning, Bill C-25 is very much needed, and to me it is a minimum. I would hope the government is not pushed off that particular agenda and doesn't compromise unduly on it. But as I said, it's a minimum, and even though it may not deal with every single question some people may be concerned about, it should be implemented as quickly as possible.

    Mr. Tony Tirabassi: Very good. Thank you.

    The Chair: Thank you.

    Mr. Desautels, I have a couple of questions of my own before we adjourn.

    This issue of the public good, and whatever it is, has become unfashionable in some quarters to talk about. But it strikes me that it is the product of what we all strive for, to see government functioning in the best way possible on behalf of citizens.

    Given the concerns about the complexity of public management, and also the concerns about how narrow partisan values have tended to drive decision-making, it seems to me we've increasingly used vehicles that take decisions out of public view and away from those who represent, or are put in place to articulate, the values of citizens. Yet given that we do not have clear drivers of profit and loss in public management, a lot of the decisions are driven by values. So I'm wondering if we haven't simply substituted the values of non-elected public servants for those of the people elected by and accountable to citizens. I wonder if this hasn't been an outcome of some of the new public management reforms.

    Mr. L. Denis Desautels: Mr. Chairman, as I indicated in my opening remarks, the public management reform that we have noted at the federal government level here in Ottawa has been less driven by political ideology than might have been the case in other jurisdictions, not only here in Canada but in countries like Australia and New Zealand.

    When I say that, I mean that's not such a bad thing, because in some other jurisdictions those charged with protecting the public good have, like the elected officials and some of the bureaucracy, transferred some of their responsibilities to other agencies that are somewhat outside the main apparatus. So in this whole debate about the new public management, I think we have to make sure we don't let, as far as I'm concerned, pure political ideology drive the agenda.

    I think we have to decide very objectively where does public administration have a competitive edge over a private provider of certain services. As Henry Mintzberg, the well-known professor at McGill, said in the Harvard Business Review not too long ago, “I do not wish to buy my cars from government any more than I wish to receive my policing services from General Motors”.

    So there are things that are better done in the private sector and things that are better done by a public sector organization. I think those things have to be looked at in a very non-ideological way, but on their own merit.

  (1235)  

    The Chair: Yes.

    In that same article, though, he also talked about how values drive decisions in public sector management. Now, that's a differentiation from the kinds of thermostats of profit and loss that drive large private sector organizations.

    I guess the question, though, is...I don't think anybody around this table would dispute the desire to move narrow political ideological forces behind public sector decisions, but it strikes me to ask how does a society make its values decisions except by the collective wisdom, the collective feelings, the collective beliefs of the people who are elected by people, by the citizens of the country? And if those values become increasingly disconnected from the decision-making of government, I wonder if that doesn't lead to some of the disconnects that we witness that cause all of us some concern.

    Your accountability functions that you talk about--and I quite agree with you about the House asserting its role in holding the government to account, but you're holding them accountable to what? Are you holding them accountable to the delivery of services in accordance with a set of principles, a set of values, a set of goals that have been articulated by the House on behalf of the citizens?

    Mr. L. Denis Desautels: Well, Mr. Chairman, I have always believed very strongly in the role of Parliament and the role of the elected officials in driving the agenda and in representing the interests of ordinary citizens, sometimes against forces that are quite strong and against which ordinary citizens have very little power or protection except for what they might get from their government and their Parliament.

    So no matter how efficient we want to be, I think we want to make sure that the supremacy of Parliament and the role of the elected officials representing the values of ordinary citizens is not basically eroded by new structures that disconnect too much the delivery from the policy-making. I think what we're saying under new public management is that you can't come up with good policy if you don't have any role whatsoever in the delivery and implementation of those policies.

    The Chair: Yes.

    We had a witness a little earlier who suggested that the concentration of the federal public service in the National Capital Region had gone up rather substantially in the last decade, from 30% of the total federal public service to 40%. I think it's actually 41.2%, if I recall the figures. I suspect that this was not a decision that was driven by the collective values of the House of Commons.

    It strikes me that we use words like “political ideology” that are pejorative in the minds of the public when we talk about separating. I think all of us around this table would accept that narrow political concerns, at one level--partisan concerns, maybe I should say--are not the basis on which to make those decisions.

    The collective values of that body of people hired by citizens through elections--of the entire House, not just the governing party--need to figure in the collective decision-making of government. I fear we've handed too much of this responsibility over to the public service, to our detriment.

    Can you reflect a bit on this narrowing of the public service and its concentration into Ottawa?

    Mr. L. Denis Desautels: I'm not sure I would agree with this particular interpretation of what's happening. I think the public service has to continue at all times to be responsive to the elected officials and has to in fact implement the policies and the programs that the government is responsible for.

    There is a whole dynamic process where members of Parliament, who are not members of government per se, should be able to hold the government properly accountable for all of that work. So whether or not the decision to have more or fewer public servants in Ottawa is the will of all of Parliament, I don't know, but at least members of Parliament should have a chance to question that and influence those decisions through the various accountability mechanisms that have been set up, which are not functioning right now as well as they could, but we should not give up on them either.

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    The Chair: Just as a final question, you commented on some of the structural issues relative to Treasury Board. What about the Privy Council Office and its role as a coordinating body also?

    It's argued by some that having two or three heads to the organization makes it very difficult to understand which direction one should go in. Do you see conflicts there between the role of Treasury Board and the role of the Privy Council Office?

    Mr. L. Denis Desautels: In the time I've been around, I've seen a strengthening of the influence of the Privy Council Office and perhaps a diminishing of the influence of the Treasury Board Secretariat. I for one would question the wisdom of that.

    I would prefer to see Treasury Board Secretariat maintain a more strategic role in a number of files and issues. That being said, I think the Privy Council Office could delegate more and rely more on what comes out of other agencies and departments.

    The Chair: I think we will draw to a close at this point. We can talk about the need for the 818 staff at PCO at another time. There must be a good reason why they're there.

    Mr. Desautels, thank you very much for an insightful discussion, as always. I suspect we will want to hear from you again as you are continuing your work of trying to understand what leads to good government at the centre.

    Members, just a reminder in terms of Bill C-25, if you have witnesses who you would like to have called, please give the information to the clerk. We have some on the list who have already indicated a desire. We can circulate this to you so you know.

    We'll try to make the agreements at least on a preliminary list tomorrow so the clerk has the maximum amount of time to organize the attendance of witnesses on the bill. So be prepared for a brief business meeting at the conclusion of tomorrow's meeting.

    Mr. Szabo.

    Mr. Paul Szabo: I wanted to inquire whether or not any attempt was being made to possibly have an in camera session, if necessary, with some representatives of the public service.

    The Chair: Is that on the study, Mr. Szabo, or on the bill?

    Mr. Paul Szabo: It's on the bill.

    The Chair: I would be more than willing to discuss that with you. If there is a value in doing that, this meeting can meet in camera or out of camera wherever you like.

    The meeting is adjourned.