PACC Committee Report
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Government Response to the Twenty-Fourth Report of the Standing Committee on Public Accounts Regarding, “Recruitment for Canada’s Future Public Service: Changing the System and Changing the Practices”
The Standing Committee on Public Accounts has tabled its Twenty-Fourth Report on June 4, 2002. The Report contains nine recommendations for improving recruitment practices and procedures as well as the government’s overall capacity to attract and retain skilled workers. It is the Committee’s response to Chapters 2 and 3 of Auditor General of Canada ‘s 2001 report, “Recruitment for Canada’s Public Service: Changing the System and Changing the Practices”.
The recommendations of the Standing Committee's Twenty-Fourth Report are directed at the Treasury Board Secretariat, the Public Service Commission, and the Task Force on Modernizing Human Resources Management in the federal Public Service (Task Force).
To remain competitive in the tight labour market conditions expected in the future, the Public Service will need to improve its capacity to attract and retain skilled employees, supported by, effective and efficient recruitment processes and practices.
Response to Recommendations of the Standing Committee’s Report
Renewal of the federal Public Service workforce through recruitment and retention of qualified individuals is one of the Government’s top priorities. The Government welcomes the Committee’s recommendations to improve the Government’s capacity in this area.
This response addresses each recommendation of the Standing Committee. It provides the Government’s position on each of the recommendations and briefly outlines measures taken to address the issues. Recommendations 3 and 4, as well as their responses (from the Task Force on Modernizing Human Resources Management in the Public Service, and the Treasury Board Secretariat, respectively), have been grouped together, to reflect a consolidated Government response to the issue of merit based compensation.
Recommendation 1 references the work of the Task Force on Modernizing Human Resources Management in the Public Service, who provided the response for this item. Recommendations 2 and 7 relate to issues within the mandate of the Public Service Commission, who provided the response to these items. Treasury Board Secretariat provided the response to recommendation 5. Responses to recommendations 6 and 9 were prepared jointly by the Treasury Board Secretariat and the Public Service Commission. The Privy Council Office provided input into the response for recommendation 8.
The Public Service Commission, the Task Force and the Privy Council Office were consulted and provided input into the Government Response to the Twenty-Fourth Report.
That the Task Force on Modernizing Human Resources Management in the Public Service consider amendments to the Public Service Employment Act and the Public Service Staff Relations Act to streamline, simplify and expedite the staffing recourse and appeal process.
Response to Recommendation 1
The Government recognizes and supports the needs and expectations of employees and managers for an efficient staffing recourse that supports a healthy and productive public service workplace. Options for improvements to the staffing recourse system - legislative and otherwise - are being examined by the Task Force. Proposals to achieve these objectives are being developed for consideration by Ministers, and will be followed, as appropriate, by proposed legislative changes to be considered by Parliament.
That the Public Service Commission review its legislated mandate to ensure that it has not delegated too much of its recruitment responsibilities to departments and agencies thereby compromising its ability to ensure the hiring of a non-partisan, representative and competent Public Service.
Response to Recommendation 2
Delegation, with its targeted and tailored approaches, provides a high degree of flexibility to address departments’ human resources needs in relation to their business objectives. In a delegated system of staffing authorities Deputy Heads and individual managers are given increased responsibility in the context of an enabling, values-based legislative framework. We believe this approach achieves an appropriate balance in safeguarding all the staffing values underpinning the merit system.
The Public Service Employment Act (Section 6) authorizes the Public Service Commission (PSC) to delegate staffing authority to deputy heads, subject to those terms and conditions which the Commission may direct. A delegation and accountability framework has been developed and implemented with a view to ensuring that staffing exercised by Deputy Heads respects all legislative requirements as well as the values and principles underlying selection based on merit. In recognition of the PSC’s accountability to Parliament, this framework also facilitates the Commission’s oversight of the staffing system on an ongoing basis. The contract between the Commission and individual Deputy Heads is formalized in Staffing Delegation and Accountability Agreements.
The agreements specify the nature of the staffing or recruitment authority to be exercised and outline related limitations and/or conditions. The delegation of staffing authority also requires the Deputy Head’s commitment to monitoring and reporting to the PSC about departmental results based on performance information. This approach permits the identification of risks and ensures that departments/agencies provide adequate information with respect to its performance vis à vis the staffing values. Individual departmental/agency performance is formally assessed on an annual basis and feedback is provided to senior management by the President of the PSC.
On an ongoing basis, the PSC also reviews the authorities it delegates to departments and agencies. As the PSC considers delegation, it is careful to ensure that authorities are properly managed and accountability is respected. The PSC is ensuring that all staffing values are well respected through the review of the departmental management frameworks and the development of an evaluation framework.
Recommendations 3 and 4
That the Task Force on Modernizing Human Resources Management in the Public Service consider the feasibility of amending the relevant Acts and Statutes to incorporate the principle of merit-based compensation.
That the Treasury Board Secretariat examine the feasibility of introducing a merit-based remuneration to the Public Service and, once completed, present the results of its review to Parliament, together with the estimated costs and benefits associated with such a remuneration system.
Response to Recommendations 3 and 4
In April 2001, the Task Force on Modernizing Human Resources Management in the Public Service was mandated to recommend a modern policy, legislative and institutional framework for the management of human resources to enable the Public Service to retain, attract and develop the talent needed to serve Canadians in the 21st century.
The Task Force is now finalizing its recommendations for legislative reform regarding human resources management in the Public Service. Their work has focused primarily on the following statutes: the Public Service Employment Act, the Public Service Staff Relations Act, and the Financial Administration Act.
In its management of compensation in the Public Service, the Treasury Board Secretariat includes merit-based or performance based elements in its approach to total compensation, primarily for those in the senior management categories.
The principal use of variable pay, based on performance, is in the Executive Group. In addition to in-range performance pay increases of up to 5 to 15 per cent for achievement of on-going business results, at-risk performance payments of up to10 to 15 per cent are also available as lump-sum awards, based on the achievement of key business results, and are eligible to be re-earned each year. The implementation of at-risk pay to align executive compensation more closely with private sector trends, was largely based on the recommendations of the Advisory Committee on Senior Level Retention and Compensation, an independent advisory body comprised of private and public sector leaders.
Public service senior employees within various occupational groups (who are excluded from union membership) are also eligible for merit or performance pay, with in-range increases dependent on annual performance results. In some occupational groups, double increments are awarded for superior or outstanding performance. Where such employees are at their maximum rate of pay, lump sums are awarded for fully satisfactory or better performance.
The Government is in line with the private sector in that unionized employees in both sectors are typically paid according to a negotiated system of increments or a single rate of pay, and that the most senior level employees are subject to a formal system of performance or merit-based pay.
The Treasury Board Secretariat will commission an assessment of the feasibility, as well as potential costs and benefits of introducing (for unionized employees) merit or performance based remuneration as an element of compensation in the Public Service.
That the Treasury Board Secretariat complete as soon as possible the development of a classification system and, once completed, table the results in Parliament.
Response to Recommendation 5
The Government agrees that the current job classification system is out of date, does not reflect the current nature of some public service work, and is cumbersome to administer. The Government is committed to achieving the benefits of modernizing its classification system, which it views as a foundation for improving human resources management in the Public Service.
Following a complex and lengthy decision-making process, the Treasury Board Secretariat announced the direction for classification reform on May 8, 2002. The government will implement a balanced program of tailored reforms carried out on an occupational group-by-group basis. The new approach will reflect the business needs of departments and the realities of the labour market, treat men and women equitably, and contribute to our ability to recruit and retain employees.
That the Treasury Board Secretariat and the Public Service Commission consult with departments and agencies to develop appropriate human resources plans and to ensure they are an integral part of their business plans.
Response to Recommendation 6
Both the Treasury Board Secretariat (TBS) and the Public Service Commission (PSC) consult with and actively assist departments and agencies with respect to the development of human resources plans and encourage integration of human resources plans into departmental business planning. This occurs in several ways.
The TBS, and the PSC, for example, provide demographic information to departments on the nature of the federal Public Service workforce, such as its size and the composition, types of employment (e.g. number of indeterminate, term, casual, seasonal employees) regional distribution, voluntary and involuntary departures, mobility data and statistics for employment equity groups.
In its annual Departmental Performance Report Guide, TBS has identified human resources management as one of the key management initiatives to be covered in accordance with the results-based management framework for the Government of Canada. Similarly, the PSC has identified the development of human resources plans and their linkage to business plans, as a core performance indicator which departments/agencies report on in their Staffing Performance Reports. This approach has also been reinforced by the PSC in recent correspondence to Deputy Heads and Heads of Human Resources. These communications highlight the risks associated with a reliance on short-term hiring and provide a reminder about assistance and tools (e.g. the staffing strategy planning tool) available from the PSC in supporting departments/agencies human resources planning efforts.
In terms of new initiatives, beginning this year, TBS will develop an outreach function within its human resources Branch to facilitate dialogue with departments, and to share best practices on human resources management issues, including human resources planning and reporting.
As well, TBS continues to update and refine its key human resources planning tools (such as the Framework for Good Human Resources Management in the Public Service) and to actively promote their use throughout the Public Service.
That the Public Service Commission develop policies and procedures to create a national selection process on overall recruitment in the Public Service and table a report of its findings to Parliament no later than October 31, 2002.
Response to Recommendation 7
The Public Service Commission (PSC) is committed to improving Canadians' access to federal public service jobs. Various stakeholders, including Deputy Ministers, have been consulted on this matter and there has been some concern expressed about the capacity to staff positions and deliver programs in a timely, efficient manner if the PSC moves to a national area of selection too quickly, without the tools and resources to handle the expected increased volume. In addition, the implementation of a national area of selection would mean that government departments located in certain communities for regional economic reasons would no longer be able to restrict selection to local candidates, and this is an element that also needs to be considered.
In response to these concerns, the PSC has proceeded with a measured approach to increase access without sacrificing efficiency and other government objectives.
A national area of selection for external recruitment of senior officer level positions was implemented in the National Capital Region in October 2001 and this was expanded to all other regions in November 2001. Executive and senior level positions open to the public are now open to all residents of Canada and to Canadians residing abroad.
A number of other pilot projects started in December 2001, to test the feasibility of expanding the national area of selection for external recruitment (for lower and mid-level officer jobs).
The PSC will be in a position to present to Parliamentarians, later this fall, the results of the regional pilot projects. These findings will serve as a basis for determining the technological support, financial investment and policy changes required for a broader use of a national area of selection.
That the Privy Council Office provide strategic direction to the Treasury Board Secretariat and the Public Service Commission to clarify their roles and responsibilities with respect to the reporting on human resources management issues to Parliament and the general public.
Response to Recommendation 8
Part of the work of the Task Force on Modernizing Human Resources Management in the Public Service, mandated by the Prime Minister, involves recommending the clarification of roles and responsibilities for human resources management in the federal Public Service.
The Public Service Commission, an independent agency reporting to Parliament, provides an annual report to Parliament, as mandated under the Public Service Employment Act.
That the Treasury Board Secretariat and the Public Service Commission strengthen the content of their accountability documents with respect to human resources management matters, particularly in emphasizing more on outputs and outcomes of their human resources management activities, and that these reports contain information about results expected and achieved. That they begin to present new information content and format beginning with the fiscal year ending March 31, 2003.
Response to Recommendation 9
The Government agrees with the Standing Committee on Public Accounts that improved human resources reporting to Parliament is a desired objective. To that end, the Treasury Board Secretariat (TBS) and the Public Service Commission (PSC) have strengthened the content of their key accountability documents.
The TBS 2002-2003 Report on Plans and Priorities builds on the reporting principles established in the previous year and introduces the notion of strategic outcome as the primary means to present plans and priorities over the next three years. It also introduces a new, standardized terminology for results-based management and reporting. As well, the Report features links to permanent websites to provide additional and more detailed program information.
Future TBS Departmental Performance Reports will focus on outcomes and associated performance on previous commitments. It will set performance in context and link resources with outcomes. Together with improvements in modern comptrollership, the net effect will be to strengthen and clarify accountabilities.
Similar to the work undertaken by TBS, the PSC began a reorientation of both the Annual Report and Departmental Performance Report for the period 2000-2001 so as to strengthen these accountability documents to Parliament. The PSC Annual Report focuses on the health of the staffing system. The PSC’s Departmental Performance Report focuses on the results the PSC has achieved as an organization in a concerted effort to better serve clients, stakeholders and, ultimately, all Canadians. In addition, the PSC continues to inform Parliament on issues identified as requiring its attention. The latest report of this nature is: ‘The Road Ahead: Recruitment and Retention Challenges for the Public Service’.