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PACC Committee Report

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Government Response to the Twenty-First Report of the Standing Committee on Public Accounts (SCOPA)

Recommendation 1

That without further delay, the Treasury Board Secretariat (TBS), in collaboration with all participating federal departments and agencies, establish appropriate systems and procedures to track and monitor all relevant costs associated with the current attempt at reforming the classification and job evaluation systems of the federal public service.

The Government is modernizing classification standards that are particularly outdated or impede sound management of human resources. These new standards will provide a more cost-effective foundation for reflecting the current and future work of the public service and for designing the organizational structures that best meet departmental needs. The Public Service Human Resources Management Agency (PSHRMA) is enhancing the systems and procedures that are required to collect and report on the costs relating to the design and implementation of new classification standards, particularly with respect to the costs that are incurred by departments. The cost methodology will include PSHRMA project costs, departmental costs, training and the costs of converting employees to the salary levels associated with implementing a new standard. This cost-tracking system is being developed in consultation with departments and will be collected within departmental financial systems and/or through the Receiver General of Canada's central system. The next steps are to finalize the approach and apply it to the work that has been done by the current program to develop new standards. The results will be reported on in the program's 2004 Annual Report on Classification Reform.

Recommendation 2

That the TBS trace the progress achieved in setting up cost monitoring and tracking systems and procedures related to the classification reform and ensure that the information is contained in the Secretariat's annual DPR for the fiscal year ending 31 March 2004, and also in the next annual update report of the classification reform.

The Government agrees to report on its progress toward establishing cost-monitoring systems and procedures in the PSHRMA's annual DPR for the fiscal year ending 31 March 2004, and also in the 2004 Annual Report on Classification Reform.

Recommendation 3

That the TBS provide detailed action plans together with implementation timetables for the initiatives aimed at improving and strengthening departmental monitoring of classification practices. That these action plans and implementation timetables be tabled in Parliament no later than 31 March 2004.

The Government agrees with the need for detailed public information on classification monitoring and is strengthening its classification monitoring program on two levels. At the departmental level, the PSHRMA is assisting classification managers to build their own active monitoring program or align their current program with an active monitoring approach. Some organizations, such as Industry Canada, have already put full monitoring programs in place while others are well advanced in the implementation of monitoring measures. The PSHRMA is also working directly with Natural Resources Canada, to validate the department-wide application of its monitoring framework. This work will continue until the end of the March 2004 and the results will be used to develop an action plan and implementation timetable for the ongoing monitoring program. This plan will be published in the 2004 Annual Report on Classification Reform.

At the broader level of monitoring classification decisions across the public service, the PSHRMA is testing its methodology by monitoring the application of classification standards. As a first step, a monitoring methodology has been developed for the Financial Management (FI) and Computer Systems (CS) groups, both of which are commonly found in most departments. Meetings with working groups of the FI and CS groups have been highly encouraging.

In May 2003, Treasury Board Ministers were briefed and the first annual update for the new classification reform program was published. The update provided an action plan and an implementation timetable for the entire classification reform program over the next three years, including monitoring. The Government shall continue to annually brief Treasury Board Ministers, report on progress through its DPRs, and, publish an Annual Report on Classification Reform, including monitoring. Annual reports will be shared with the Committee. Beginning in 2005. The President of the PSHRMA will include a report on classification reform as part of the Annual Report to Parliament on the Health of the Public Service, which is a legislative requirement of the new Public Service Modernization Act.

Recommendation 4

That the TBS complete the testing of its methodology for the Government-wide monitoring of the integrity of departmental classification practices and report the results in its annual DPR for the fiscal year ending 31 March 2004.

The Government agrees to test and refine its monitoring approach and methodology until the end of the fiscal year 2003and to regularly inform employees of the Public Service of progress on classification reform. The Government will publish the results in its Reports on Plans and Priorities as well as DPRs that are tabled annually in Parliament. The PSHRMA will also give an account of progress made in its Annual Reports on Classification Reform and in the Agency's annual report to Parliament on the Health of the Public Service.

Recommendation 5

That the TBS develop the practice of executing proper post-mortems within reasonable delay for all its large-scale, Government-wide projects.

The Government is committed to the principles and practices of sound project management, and shall execute proper reviews in accordance with approved project evaluation guidelines. In the case of the Universal Classification Standard (UCS) project, a thorough management review was carried out immediately following the decision not to proceed with the project. The results of the process continue to inform the current program for classification reform. The review process included internal meetings to identify the lessons that were learned from the UCS project, as well as external review sessions, held during the current program's first Annual Symposium on Organization and Classification held in June 2003. A third dimension, an international research project, was undertaken to investigate emerging trends and best-practice experience in other jurisdictions with respect to job evaluation systems and classification frameworks.

Recommendation 6

That the TBS develop better record-keeping and tracking systems and procedures to support comprehensive post mortem exercises.

The Government agrees that good record keeping and tracking systems are important. The TBS has a project management policy, which applies to most departments, to ensure the development of adequate record keeping and tracking systems as part of an effective review process. In the case of the UCS project, strong records and tracking systems were in place. A post-mortem exercise was held, and a series of documents and presentations were produced that demonstrate useful outcomes of the post-mortem exercise. Five monographs were produced and provided to the Office of the AG. A compendium of lessons learned was developed which continues to be expanded to apply to the current program and provide direction for planning and future initiatives. A symposium summary report was produced which references, not only the lessons learned from UCS, but also the ideas and suggestions of departments and agencies for moving ahead with a sustainable classification program in the Public Service of Canada. Finally, the 2003 Annual Update on Classification Reform concludes with a section on the legacy of UCS and a commitment to modernize the classification system of the public service.

Recommendation 7

That the TBS complete the development of a corporate compensation policy for the federal public service at an early date and ensure that the principle of pay equity is maintained.

The Government agrees with the need for a comprehensive compensation policy. Federal public service compensation should serve, within an overall human resources policy framework, to attract, retain, motivate, and renew the workforce required to deliver business results to Canadians. There are several factors that influence compensation, including the private sector labour markets, internal relativity among groups, macro-economic policy, social policy, relevant legislation, union leverage, public opinion, economic conditions, and the state of Government finances. The policy framework provides guidance on how to balance these factors and the risks associated with them. Indicators have been proposed to monitor the implementation of the policy as it affects compensation outcomes.

The Human Resources Management Office of the TBS completed its first draft of the Compensation Policy Framework discussion paper in May 2003, which will assist in shaping the federal Government's approach tocompensation, including the development of collective bargaining mandates. On June 25th, the President of the TBS approved the document for external consultations. Since June 2003, the TBS has been consulting with Central Agencies, Departments, Separate Employers, Bargaining Agents and academia, as well as the Advisory Committee on Senior Level Retention and Compensation.

A revision of the paper, to include comments from the round of consultations, will be completed by Summer 2004, with the intent of finalizing the Compensation Policy Framework by the end of 2004.

Recommendation 8

That the TBS prepare an action plan together with an implementation timetable for the complete introduction of the corporate compensation policy for the federal public service. That the Treasury Board report on these initiatives to Parliament with ongoing updates in its annual performance reports and also table a specific annual report to the Public Accounts Committee and begin reporting for the period ending 31 March 2004.

The TBS is in the final stages of consultations on the Compensation Policy Framework, the last consultation scheduled to take place in January 2004. The paper will then be revised and updated to reflect the comments received during the six-month consultation phase. The TBS will report with ongoing updates on the Compensation Policy Framework in the DPR.