I call the meeting to order.
Good afternoon, colleagues. This is meeting number 104 of the Standing Committee on Public Accounts for Tuesday, June 12, 2018. We are here today in consideration of the message from the Auditor General of Canada that accompanied his 2018 spring report.
I would remind all colleagues here today that we are televised, so I would encourage you all to please put your phones on silent or vibrate so there's less distraction.
We are honoured this afternoon to have Mr. Michael Wernick, Clerk of the Privy Council and secretary of the cabinet with us. As it is somewhat unprecedented for the Auditor General to write such a message, it is also unprecedented for me to open this meeting with a few words of explanation as to why the committee has requested your presence here today, Mr. Wernick.
Our focus is not primarily on the Phoenix pay system, nor is it with respect to the poor outcomes of indigenous programs. Although both are extremely important and are mentioned to great extent in his last audit, they will be subjects of future upcoming meetings. The objective of today's meeting and the objective of the Auditor General's message is “to lead to a deeper understanding and correction of the pervasive cultural problems at play” within the public service.
This is a culture that has created, in the Auditor General's opinion, “an obedient public service that fears mistakes and risk. Its ability to convey hard truths has eroded, as has the willingness of senior levels—including ministers—to hear hard truths.” This is a culture the Auditor General claims has caused and will continue to cause incomprehensible failures. It is this committee's sincere hope that this meeting today starts a process of change so that we do not experience any more “incomprehensible failures”, failures that have adversely affected so many people, failures that could have been avoided and can be avoided in the future.
We welcome you, Mr. Wernick, and I turn to you for your testimony today.
I don't have a statement or presentation or anything like that. If you'd indulge me, I might make a few opening comments and then we could get right to your questions.
The first thing I should get on the record is that as soon as I received your invitation, I accepted it within the hour, and I'm very pleased to be here. Second, I am willing to stay here as long as you have questions. The last time I was before this committee I was deputy minister at what was then Aboriginal Affairs, and I was here for five hours spread over two days; I think Mr. Christopherson might have been there. I remind my colleagues behind me: I was there for five hours and no journalists attended, not one, so I'm pleased to have the opportunity to have an exchange with you on the record.
This is National Public Service Week, and it's a great opportunity to engage with you, and through you, I hope, with Canadians about their public service.
I have a couple of opening comments. The first one I think is very important to get across, and it is that Canadians should be very confident that they live under the rule of law in a healthy democracy and that they are served by strong institutions of governance—independent courts, free elections, a vigorous legislature, officers of Parliament, and a free press—and by a non-partisan, values-driven public service that is very good at supporting democratically elected governments, delivering their agendas, and providing a very wide variety of services to Canadians.
I consider it part of my job to engage Canadians in an ongoing conversation about their public service and to channel the stories of other public servants who do not have a voice. I have had the honour of submitting three annual reports to the about the state of Canada's public service, all of which were tabled in Parliament, and I've never been called to a parliamentary committee to be questioned about them. They've all been posted on the web and they have provided a vehicle for an exchange with public servants and other Canadians.
I am hidden in plain sight. I have a website. I have a social media presence. You can follow me. You can look up more than 40 speeches that I've given to a wide variety of audiences. I have tried to be very clear and candid about what I think, where we are as a public service, and where we can do better.
I only have a couple of opening comments, and then the point would be to take your questions and have a dialogue.
The first is that Canadians should have confidence in the excellence of their public service. That is not just an opinion; I bring you evidence. The World Bank, which is not a radical institution, ranked 200 countries on the effectiveness of their governments, and Canada was in the 95th percentile, with only a few small countries ahead of us. A think tank and a business school in the United Kingdom tried to rank the effectiveness of public services and created an index of 12 different factors of the effectiveness of public service: Canada was number one last year. The Global Government Forum took all the G20 and all the European Union countries and assessed them on the presence of women in leadership and public sector positions. Canada was number one. The World Wide Web Foundation, which tracks issues around the Internet and new technology, ranked 115 countries on how their governments are engaging with their citizens on open data: Canada was number two to the United Kingdom. Forbes magazine listed Canada's best employers in 2018, and seven federal departments, including two of the largest, are on that list as best employers in Canada.
One reason that the Canadian public service is strong is that there are many feedback loops on what we have done and what we could have and should have done better, and this committee is certainly an important part of that. I would assert that we have a culture of learning from mistakes and constantly striving to adapt to change and be better.
Another is that the senior leadership of the public service is very capable and guided by strong values. My assertion to you is that the senior leadership community of public service today is as good as or better than any that has ever served this country, and I would argue better, because the job's just getting more and more complex and challenging.
The second message to you is to urge you, as a committee with great responsibility and influence, to be very thoughtful in coming to a view about what should be done as we move forward. If you start from the wrong diagnosis and start applying harsh remedies and surgeries, you could cause very serious side effects and complications. You could even kill the patient. It has taken generations of work and effort to build a world-class public service that is envied by other countries and that people come to Ottawa to emulate. It will take a lot of work to make it even better, but it could be very damaged, quickly, in a matter of a few years, and it could take a generation to bring it back, so I would ask you to weigh very seriously the evidence you have heard and that you'll continue to hear, and engage Canadians on how we can have an even better public service to meet the challenges as we go forward.
I'm willing to stay as long as you want. I have some expertise and experience in the accountabilities of deputy ministers, how they are chosen, their tenure, and their turnover. I particularly welcome questions about the incentives and disincentives on which we operate, and I have some ideas for you on specific structural reforms that could be pursued in the future.
My view on the Auditor General's chapter.... I have enormous respect for Michael. We've met many times and had a lot of important conversations about his role and mine, and, as I think you're aware, we came to an agreement to give him even more of an unprecedented access to cabinet confidences in order to serve you as parliamentarians and Canadians. When he's on the ground of sound audit methodologies with strong recommendations about what can and should be done, he's of great service to the country, but chapter zero is an opinion piece with which I take issue and that I'm happy to discuss. I believe it contains sweeping generalizations. It's not supported by the evidence, and it doesn't provide you any particular guidance on what to do to move forward.
I also don't agree that the pay system was an incomprehensible failure. I think it's entirely comprehensible. It was avoidable. It's repairable, and it gives us all kinds of lessons about how to build a better public service.
I look forward to your reactions and questions.
Thank you very much, Mr. Chair.
Mr. Wernick, thank you for being here and for accepting our invitation on such short notice. I really appreciate that.
I would like to take this opportunity, as you mentioned this is National Public Service Week, to congratulate the Public Service of Canada for the excellent job they do in serving Canadians. We should never forget the important service they provide and how fortunate we are to have a public service that is so professional and so dedicated.
That said, you have just opened the theme of this meeting. You say you disagree with the sweeping generalizations that the Auditor General made in his chapter zero, or his message. We as a committee—and this was pretty much unanimous in the committee—were quite distressed to find that in his analysis, what happened, both with the Phoenix pay system and with services to first nations, Métis, and Inuit communities, had, for him, become almost the image of what went wrong, even though we had such a great series of checks and balances in our system. It's all there, so how could this happen?
I'd like to hear you tell us, as you say you have your own views on the matter, how you would consider it avoidable. What wasn't done that could have been done to avoid such a failure?
Thank you for your question.
I think there are several elements in there. I'll try not to go on too long.
I don't understand the comparison to indigenous policy, and it's an area I worked in. The situation of Canada's indigenous peoples is the result of generations of public policy and law, and other factors. There are many theories and explanations about how we got here, and very different views about how we can move forward. It's a policy failure, basically. It's going to be a difficult one to move forward on.
As some of you will remember, the Auditor General's predecessor, Ms. Fraser, tabled observations, a chapter zero on first nations, in the spring of 2009. It's a very helpful piece on indigenous policy. I commend it to you. It had four very specific prescriptions about what could be done to improve outcomes in government programming for first nations. I thought it was a solid contribution by the Auditor General to public debate, and it's something that I have used a great deal in advising ministers at the indigenous affairs department. I'm happy to pursue that, but it's a very big topic.
I think that you can continue to pursue the explanations of what happened in the pay system. My view is that it's comprehensible, and it's all there in the two reports from the Auditor General, in the Goss Gilroy report and in the Gartner report.
I don't want to put words in anybody's mouth, but I think what he's trying to say is that there's no single culprit or single explanation. To the people who are looking to simply say, “Here are two or three people we can blame” or “Here's the explanation”, my take on the pay system is that it was a perfect storm and confluence of all kinds of factors, which are laid out in the Auditor General's two chapters.
You can continue to pursue that line of inquiry. There have been many officials appearing at this committee, at the government operations committee, and at the Senate finance committee. It's perfectly legitimate to want to pursue the forensics of what happened and how we got here. In my view, it's not actually going to help that much in the urgent job of stabilizing the system and getting people paid on time and accurately today. It doesn't provide a lot of guidance on what to do going forward, other than the specific recommendations the Auditor General made on this topic and the report by Goss Gilroy, which I think provides lots of lessons on project management.
First off, thank you very much for your attendance. It's good to see you again.
May I also echo your comments about the excellence of our public servants. I've served at all three orders of government and have said since almost 30 years ago how blessed we are. At that time I meant at the city level, and now I mean also in my experience at the provincial level and at the federal level. We are truly blessed, as a country, in the calibre of citizens who decide to put their professional careers and their abilities and their passion into making Canada a better place. We are so, so blessed. I say that all across the country, and I say it internationally, and I mean it from the bottom of my heart. Where there are problems, in the main it is not those individuals who are the problem; it's the systems and the procedures that the rest of us and the senior management have imposed on them. I think that's a great place for us all to start and to agree that individually we are so lucky as Canadians in terms of the people who choose to be in our public service at all three orders of government.
Second, I feel the need to nitpick a little bit. You talked about how you recently offered new information to the Auditor General, leaving the impression that it was graciously offered. Given the fact that the federal legislation is absolutely clear that the Auditor General is entitled to anything he or she wants, I am reminded of big corporations who brag to their new employees about all the benefits they're going to get, neglecting to mention that it was the union that actually fought for those rights and that some of us had to strike for them. The company then takes the credit, saying, “Here are all these wonderful things that we give you.” I just want to mention that if anybody's giving anything, it's the Auditor General respecting the niceties of how decision-making is made at the cabinet level, but at the end of the day the Auditor General of Canada is entitled to whatever information the Auditor General of Canada wants, and that's what the legislation says.
Now to the crux of it. I was so hoping this wasn't going to happen. What you said today, sir, is like my worst nightmare come true after I read this message from the Auditor General. When I read this, my jaw was on the floor, and I think there are a number of colleagues who would say they felt the same way. It's like, “Wow!” It was the opposite of what you are saying, Mr. Wernick. You're talking about how this is a one-off. This is a message from the Auditor General—not just a chapter, but a formal message from our Auditor General—the taxpayers' and citizens' best friend on Parliament Hill to Parliament, and what it says is we have a massive cultural crisis.
Therefore, when I listen to your remarks today, with all due respect, it's one of two things, and I say this to my colleagues: either we have a deputy of the Privy Council who has his head buried in the sand and is in complete denial about what the cultural problems are, or we have an Auditor General who's off the rails. There's not a lot of grey area here. There's not a lot of nuance.
What you're saying today, Mr. Wernick, is almost the opposite of what the Auditor General has said about what the problem is, what the solutions are, and what the observations are.
Where does that leave us? I thought we were going to have a Clerk who was going to come in and say, “We agree. We appreciate the focus on the problem and we want to be part of the solution. We want to work with you, public accounts, to be a part of that solution, with all of us working together.” Then I was trying to think how we would do this. It's brand new. It's kind of exciting, but, you know, it's really serious. We've never done this, not in my time, so how were we going to do it?
Instead, it's like we're at below zero—and don't ever refer to an Auditor General's report as “zero”, please. We are in deep trouble right now according to the Auditor General, whose sole mandate—and remember he's an agent of Parliament—is to make sure that Canadian taxpayers' money is well spent and they're getting the services that they deserve and are entitled to, but we have a Clerk of the Privy Council who's coming in and basically saying, “No, no, no, it's no big problem; no, no, no, it's not that at all. I disagree with the Auditor General. This is just another one-off problem. We'll work on it and we'll fix it.”
Well, Chair, that's not where we are. All I can say to you is that it seems to me that at some point pretty soon, we as a committee need to decide where we are. Do we agree that the Auditor General is off the rails, or do we agree that we have a huge problem that's made even more difficult by the top of the bureaucracy not accepting there's a problem?
Now, like most things in life, I suspect that somewhere in there is where we need to be. People know how I feel about the Auditor General and where I will likely be when we have those discussions in private or public, but I'm fair-minded. I like to think I'm fair-minded. I'm open-minded. I'm angry, but I'm open-minded about the process.
It seems to me, Chair, that at some point we need to find a way that we can decide where we are on these two extreme positions. The positions do not line up. Do we support the Auditor General or do we support the Clerk of the Privy Council? It seems to me that until we decide that, we can't decide on our course of action, because believing one takes you down one road and believing the other one takes you down another road. We could have the committee flying all over the place and being totally ineffective, which then would be us not doing our job and us letting our culture fail us.
Those are my thoughts, Chair. I'll leave it at that and hear what my esteemed colleagues think.
Mr. Wernick, thank you for being here with us this afternoon. We are pleased to see you here. It is important for us to hear your testimony. As my colleague Ms. Mendès said, we are pleased that you accepted our invitation on such short notice.
I would like first to respond to what our colleague Mr. Christopherson said. My colleagues know that I spent close to 17 years in various departments in the federal public service. So I can attest first-hand to the fact that many public servants work extremely hard, are committed and dedicated, and offer important services to people right across Canada. There are many examples of success in the public service.
I am thinking for instance about the Public Service Pension Centre in Shediac, which successfully completed a major modernization initiative in recent years.
I am also thinking of the largest documentary imagery centre, the Digital Imagery Research and Development Centre, in Matane. It was in fact developed by public servants who are dedicated to serving Canadians and other departments.
I am also thinking of the 40,000 Syrian refugees we welcomed recently, thanks to a department and public servants who were able to turn on a dime and do the important job they were given.
That said, I also fell over backwards when I saw the Auditor General's report and the message he sent us. This important message shook us and shook the public service and its management. I would even say it made them angry. The Auditor General is not the only one to say there are problems. Obviously, it is not black or white. There is something in between. Clearly, there are problems in the public service. As you pointed out, with 260,000 public servants, of course not everything is perfect.
I simply wanted to point that out. I was reading something by Donald Savoie recently, someone you are no doubt very familiar with. He was also quite blunt. I would like to hear your thoughts on what he said. I will read it out in English since it was written in English:
|| ...the public service is now bogged down by rules, oversight and a controlling [centre] that it has “lost its way” and ability to manage....“they have learned the art of delegating up to PMO and PCO” rather than down to the front-line workers, as they did in the 1970s and 1980s, to get things done.
So I would like to hear your thoughts about how we have tackled certain problems in the public service and about potential solutions. As I said, it is not black and white. There is something in between.
You produced an annual report that is very positive on the whole. I know, however, that you are aware of problems that should be addressed and I would like to hear your thoughts on that.
Thank you for your question.
I am not saying the public service is perfect or does not make mistakes, even serious mistakes, from time to time. It was created by human beings and is managed by human beings. Further, its services are delivered by human beings. So mistakes are made. That said, we have a strong culture of learning and feedback. I invite you to look at the chart I gave the clerk.
There are many layers of oversight, lines of accountability, and feedback on the senior public service, all of which are, in an engineering sense, a negative feedback loop: what you did wrong, what you could have done better. There are almost no positive feedback loops other than performance, pay, and promotion within which senior public servants operate. I think you have to look very deeply at the incentives structure, which is the one in which human beings act, and culture is shaped by incentives and disincentives. There are opportunities to create incentives and disincentives that reward innovation and creativity, or that stifle it. That's a big topic, and I'm happy to exchange with you on that.
The importance of my report is it is a very rare opportunity to talk about the successes and the accomplishments. I've never been asked to a parliamentary committee to talk about three annual reports on the state of the public service. I've never been asked a question about the innovation fair, which showcases all the examples of letting people loose and asking them to come forward. I've never been asked a question about the prize challenges through which we're trying to develop solutions by working with outside partners. I could go on and on about those, but because your attention as parliamentarians, quite reasonably, is drawn to all of the feedback loops from almost a dozen institutions that are there simply to look very closely at particular issues and point out what could have and should have been done better.
I'm not complaining about that. I think that is the explanation for why we are as good as we are.
To jump to Mr. Christopherson's question—and by the way, it's the Auditor General who calls his opinion pieces “chapter zero”—if sweeping generalizations are made about the culture across 300 different organizations and all of their subunits spread across 10 provinces, three territories, and 100 different countries, none of those generalizations will stand up to scrutiny, and I bring you evidence. I bring you three annual reports full of stories showcasing the accomplishments and the successes of public servants. I bring you those six indicators that tell you of this success. If you want to ask somebody who knows organizations, I can suggest another witness to you: the global managing partner of McKinsey, who's looked at every big, top, high-performing private sector company in the world. He's is a Canadian, Dominic Barton. He's worked for Stephen Harper as part of his advisory committee on the public service and he's worked for as chair of the growth council. Ask him what he thinks about the public service of Canada.
Thank you, Mr. Wernick. It's really nice to see you. As I look around the table, I'm probably the only one you have worked with in the past around the cabinet table, so I may be coming at this from a different perspective.
I'm glad you mentioned your speeches. I was taking a look at one you gave to the ADMs on April 11 that caught my attention. In it, you talked about the future, and I think that's fair enough. We know what's happened in the past; what are we going to do going forward on the pay system?
You said you were going to take all of what is emerging in disruptive technology, rethink the technology, project management, and procurement, and apply it to getting us a pay system that works. That will be one of the signature projects of the next few years.
That, to me, means we really have to understand what happened in this payroll system, specifically at the very end of the decision-making with respect to when it launched.
The Auditor General said that part of the reason he wrote this message was to explore the cause of the failures. One part of the cause of the failures that I don't see anything about is the one I want to discuss with you, knowing we've both had experience around the cabinet table.
Mr. Wernick, my understanding is that you became the Clerk of the Privy Council on January 20.
I used it more as illustrative of how the decision-making happened, in a concrete kind of way, because my concern is not only about what happens within the public service. The mantra of the federal public service is to fearlessly advise and to faithfully implement, and I want to make sure that there is fearless advice given to the decision-makers in that cabinet room.
That's why I was asking Mr. Wernick those kinds of questions around what kinds of processes were in place. For me it's important to know that 14 deputy ministers, potentially 14 ministers, should have known that there was a problem, because taking a stance against Treasury Board is a pretty bold thing to do in a government, having been on the wrong side of Treasury Board on a few issues.
I'm just curious to know, when you get to that stalemate, what you do and how we prevent that stalemate from happening again. What are the assurances that when we go on this brand new program, which is going to be even more complex, we get it right?
That's a big topic. I have quick comments, and I'm happy to come back on this if you want. Big IT projects have high risk in the private sector, in universities, and elsewhere. They're hard. “Hard things are hard”, as they say.
The current government has tried to apply the lessons from Goss Gilroy right away and to make some strides on that. You will see in the budget implementation act, which is days away from being passed, stronger legal authorities for the chief information officer at the Treasury Board to direct departments and impose standards and for the role to have real teeth instead of being just an advisory role. I think that's a very positive development.
We established out of some funding from the last budget the Canadian Digital Service. Minister is a great champion of the migration to digital services, and there are many stories I could tell you about progress on that.
I can say on the Phoenix thing that this is where I do agree with the Auditor General's first report: there isn't really any option of restarting. We have to move forward. If we don't deal with the underlying complexity of the classification system and the thousands of payrolls and we just go back to the same vendor community, we will get the same answer.
I'm glad you brought that up, because this leads to my next question.
The Parliamentary Budget Officer put out a report last year on the costs of the combat surface vessels, about $60 billion. One issue he had was that despite being granted the powers under the parliamentary act to access the RFPs and other costings, he was blocked by the bureaucrats from accessing this information, to the point where he had to go to the States to access American costs to bring back here to extrapolate. We brought it up repeatedly.
Again, here we have, perhaps, in the Phoenix case, a bureaucrat ignoring the rules, blocking the PBO from delivering a proper study on what could eventually be an $80-billion project. Might this be of concern to you? In the past with Phoenix, we've seen the bureaucrats blocking information to ministers; now they're blocking the PBO.
I also want to acknowledge that it's National Public Service Week. Truly, I agree with the sentiment that's been shared around the table today that our public service does incredible work. Certainly we are here to look at ways in which we can improve and do better.
I've heard Mr. Wernick take issue with the Auditor General's chapter zero, specifically not agreeing with the “sweeping generalizations”, as he put it.
I read through chapter zero and tried to focus on what the Auditor General explained as the incomprehensible failure. He said that his work was able to determine what happened and how it happened, but his audit could not explain why it happened.
He speaks about the culture. Specifically he writes, “Organizational culture is often talked about, but it is difficult to define or measure, so it needs to be described.” He goes on to say, “I want to be clear that the current government did not create this culture—it inherited it—but it now has an opportunity to shape it for the better.”
Mr. Wernick, you spoke about the fact that there need to be profound structural reforms in the public service moving forward. Can you describe and explain what you mean by that?
I'm glad you had an opportunity to respond. It's not meant to be a kangaroo court; it's meant to be an opportunity to exchange ideas and thoughts.
Since we're doing a little nitpicking back and forth, I would just say, in terms of that court decision, that no Auditor General has ever asked for cabinet confidences. They have no interest in what staff recommend to cabinet. It's not their business. It's not what they do. They don't care. The problem has been that information the Auditor General is entitled to, such as whether the staff have done the proper work to make sure the minister was informed to make the right kind of advice to cabinet, has been often swept under cabinet confidence by different governments that didn't want to release the information, so we get into these tug-of-wars. In terms of the raw information that Auditors General want, they are entitled to that, and they don't want the political stuff; they do everything they can to stay away from it.
Second, on chapter zero, it sounds as though I'm wrong. I stand corrected and I apologize. It also proves that Michael is no politician.
Let me also now move to a couple of comments to reaffirm what I've said earlier and my conclusion in terms of where I think we're going or not going. This is from the report:
||As I said earlier, the bottom line is that the culture has to change. I don’t have a set of instructions to fix a broken government culture. But I know that the first step has to be to describe the current culture, which I have attempted to do, although I may not have captured everything. The second step is to admit that the culture problem is real and that it urgently needs to be fixed. How to fix it will be up to the government and the public service. The silver lining is that while there is a culture problem, the recent public service survey shows that the average public servant wants the culture to change, and wants to work in a culture that focuses on results for people.
Next, the reason I'm so disappointed in the direction that this discussion is taking today is that we have a perfect opportunity to do this in a climate where there is no weaponization or politicization of this document. The Auditor General has said that this has been going on for decades, that it is not the result of the Harper government such that we're going to go after them and demonize them some more, and it's not the result of the current government such that we're going to do everything we can to take down the current and replace him in the next election. The Auditor General is saying this has been going on for decades, and if we want to place blame, there's blame to go around for everybody. Coming from one of the parties that's never been in power, I tell you I'm not interested in blame. We do that in the House of Commons during question period and a whole lot of other places, but not here, colleagues.
I want to quote another couple of lines from the Auditor General's report, since again the Clerk has a different view from the Auditor General's.
The Auditor General says, “I am not assigning political blame, but my view is that both governments had opportunities to prevent the incomprehensible failure that Phoenix became.”
Let me just say what a great opportunity this is for us. Nobody's saying this is about partisan politics. It's about the culture. What a great opportunity. Nobody needs to feel defensive, colleagues.
He goes on to say, “A standard lessons-learned exercise won’t prevent future incomprehensible failures. Phoenix is a defining moment—a wake-up call—that goes well beyond lessons learned. It needs to lead to a deeper understanding and correction of the pervasive cultural problems at play.”
He continues: “What follows is my description of the culture in the federal government—a culture that has evolved with each passing decade. I want to be clear that the current government did not create this culture—it inherited it—but it now has an opportunity to shape it for the better.”
The last thing I want to say, Chair—a little indulgence, 30 seconds—is that we need mainstream and social media to jump on this and make it the issue that it is. I know the Phoenix thing gets all the headlines. It's nice and easy and it's the politics and it's sexy, and I get all of that, but this is what's underlying, what's causing Phoenix. If we don't see this as a focal point, it's going to go on and on, and basically this will get swept under the rug. That's where we are right now. Either this becomes an issue that we care about.... I think we need some outside pressure here from somebody in the media, from those who have access, who will focus on this and say, “Hey, this is a big deal. Please take this unique opportunity, where there's no political blame, to fix it.”
We're the ones who should be providing the leadership to do that.
Chair, thank you for your indulgence.
Just with respect to that, I'll take a little bit of the chair's prerogative here and say that one of the issues around having a meeting like this one is that in our offices all of a sudden we've been getting letters from people in the public service. This one was sent to me in advance of Mr. Wernick's appearance at PACP today: “I want to send you some thoughts on the culture of the public service that could have led to this Phoenix disaster.”
He says he worked at such-and-such a ministry and had been there for quite a few years. I won't give you the years or where he works.
He continues, “I had the pleasure of serving as an advisor to the deputy minister for one of those years. In my time in that office, I was profoundly disappointed to see how priorities were set—in short, the only concern to be satisfying the mandate letter commitments of the minister.”
He goes on and lists other things: “Having seen this up close and personal, I was entirely unsurprised by everything I read in the Auditor General's report. If MPs really want to tackle the broken culture of the public service, they could begin by demanding those responsible for the Phoenix mess to be held to account. As it stands, no one is ever held responsible for the screw-ups. People are simply shuffled into different positions.”
There is part of the culture. I think the Auditor General also mentioned that some of these deputy ministers are here for a year or two and then shuffled off to another department. I think that's part of what he says is the problem.
The Auditor General says, “In this culture, for a public servant, it is often better to do nothing than to do something that doesn't work out.”
The fear of risk: is that part of the culture? We're getting letters from public servants saying that this culture needs to be fixed.
Lisa...or Ms. Raitt; I'm sorry.
You're allowed to call me Lisa, Mr. Chair. That's okay.
Picking up from what Mr. Christopherson and the chair said, if this were an isolated incident in which only the Auditor General was pointing to the culture issue, then I could accept the fact that it has no evidence, but we do have another individual, the Public Sector Integrity Commissioner, Mr. Joe Friday, who testified a year and a bit ago to the government operations committee. He said that “there cannot be an effective whistleblowing system without a culture shift—where speaking out about potential wrongdoing is an accepted part of public sector culture and where this can be supported and responded to in a climate free from fear of reprisal.”
I mean, he raised the alarm last year, Mr. Wernick, that Canadian bureaucrats will never routinely speak up about wrongdoing in the federal government until a deeply rooted culture of anxiety over whistle-blowing is eliminated. That's the beginning point. I don't know whether or not the Auditor General is actually out too far on a limb when he brings that up in the context of decision-making around Phoenix.
That said, I know that you've put mental health in your mandate letters for your deputies, and I think that's commendable. I think it's very good that people have to look after their workers within their own departments. I'm wondering whether or not there's room for you, going forward, to somehow deal with an issue that is apparent to other people who monitor the public sector but maybe is not as accepted at the higher levels that you work in.
Yes. I commend you to my report and all the speeches I've given on this topic. We definitely have to move on the culture. I would recommend the committee look at the incentive and disincentive structure within which people operate.
I go back to my opening remarks. If the diagnosis is wrong, you will prescribe remedies that could do great damage.
You alluded, Mr. Chair, to rapid turnover of deputy ministers. The facts speak otherwise. I have the evidence for that. The Auditor General left an impression that is factually incorrect, and you can correct that with evidence. The way to measure deputy ministers' tenure is how many years they were in the job from start to finish. If you look at the 33 deputy ministers whom I have some influence over, and the last three terms they completed—not the snapshot of the ones that are in now and haven't run out their clock—you see that's 99 deputy terms. Thirty-three ministers completed terms, and three.... Forty-nine of those were for more than three years, which is the benchmark this committee suggested in previous reports; 27 were in their jobs for more than four years; and 16 were in their jobs for more than five years. The median and the average are both greater than three years, so my view is we don't have a pervasive, generalized problem with deputy turnover.
They have a cumulative experience, on average, of about 20 years of experience as an executive in some form or another. I have worked hard to bring in other skill sets and talents. I have hired two provincial cabinet secretaries. We have brought in the chief of the defence staff as a deputy minister, and we have brought in people who have been private sector CEOs and have run think tanks. We are always trying to improve the leadership cadre that runs the public service.
Officers of Parliament have their role and have their opinion, but they are outside observers. The important thing for Canadians to understand is that all of these were designed to ensure Canada is well governed. All in all, Canada's public service is free of nepotism, free of corruption, and free of partisanship. There will be errors and exceptions to that, but they are detected, corrected, and remedied.
It's important in this day and age that Canadians have some confidence in their public institutions, and I am committed to making them better as we go along.
We have an annual survey now. The letters and the emails from constituents are an important feedback loop, and I understand that, but they are the people who are motivated to write to you, so we have tried to go to an annual comprehensive survey. The results of that survey, not all of which are flattering, are in my annual report. It's on the Internet.
Mr. Chair, I have lived and worked in several countries. One thing I should say is we have one of the best public services in the world. I know there is no corruption. Public service employees here are very well qualified, and as Mr. Wernick mentioned, yes, sometimes mistakes do happen with 270,000 employees and 6,400 executives. Mistakes do happen, but if corrective action needs to be taken, it is taken.
Mr. Wernick, I have a question in terms of the decision-making. What decisions are made at what level? On Phoenix, IBM was appointed to develop and implement it. In 2012, IBM said Phoenix would cost $274 million to build and implement, but the Treasury Board had approved only $155 million in 2009. If anybody asks me, they can trace back the problems of Phoenix to one single major factor, which is this: IBM said it required $274 million, but the budget available was $155 million. Still the decision was made to go ahead with the same budget.
I would like to know at what level the decision was made. Was it at the Phoenix executive's level, or the associate deputy minister's level, or the deputy minister's level? At what level was the decision made to go with this low budget?
Yes. To be very clear, on the governance point—and I don't want to get too bogged down in this—I do not have any executive authority to tell a deputy minister or any public servant, outside of the Privy Council Office, what to do.
I do recommend promotion, movement, and performance pay to the , and I'm able to do that through an annual cycle of agreements on what their goals are. We review performance, and on that basis I recommend performance pay. I take full responsibility for advising the Prime Minister on the deployment of deputies and whether they stay or whether they move. These commitments do have leverage, and I've used them in specific areas, such as mental health and others.
I don't know how exactly you measure organizational culture. I don't know what they would report back with. On the pay system, I think it was important to make clear to Canadians that departments were taking pay seriously on things that they had some control over—training, emergency pay, and relief. These were things they could make some strides on in their own department. I asked everybody to write in and say what they were doing. I told them in advance that we would put them all on the Internet so that Canadians, including parliamentarians, could take a look at them. That's a technique we can use.
For the best way to get a culture, I think I'll defer to expertise on that. It's a different methodology. You have to do surveys. You have to do deep dives. I just don't think you should be lured into making general statements that there is a certain culture across 300 organizations and all of its subunits spread across all of the geographic locations. There are some very strong and healthy organizational cultures and there are some very troubled ones. The art is going to be knowing which is which and to have the right incentives and feedback loops to correct the ones that need correcting and to emulate and copy the ones that are strong.
It's a big topic, and one you might want to spend some time on.
Senior leadership positions basically fall into two categories. There are the heads of crown corporations and specialized agencies, officers of Parliament, and so on. They tend to have fixed terms, employment contracts, and the severance clauses and all the disciplines that go with that.
Deputy ministers, in the sense of ministers who run departments and are close to ministers, have no job security. They do not have formal employment contracts, and they'd have no entitlement to severance. They operate with totally precarious employment.
Below the level of deputy ministers, if you're covered by the Public Service Employment Act, then you have very strong job security. You can only be terminated for cause, which is a legal test. It is extremely difficult to fire people in the public service for poor conduct or poor performance.
I think the time is right—maybe after the next election, not in the last year of a Parliament—for a structural change to the public service. I think that we have made a lot of progress under successive governments on openness and transparency, opening government up to Canadians. These are decisions built up over the years with a lot of pressure from this committee and from others.
This is the bucket I would call glasnost, openness. All grants and contributions are on the Internet. All contracts are on the Internet. All travel and hospitality are on the Internet. Every single performance and measure used by every department is on the Internet. We've moved forward in strengthening the role of the parliamentary budget office and the chief information officer. We've strengthened the role of the chief statistician. This government has worked hard on open government, although it was something that Minister Clement pursued in the previous government, which is why we're ranked number two on open government in the world. We have something called GC InfoBase, which makes all kinds of data available to you and to other Canadians, which is just getting better and better, and so on. We have made some movement on cabinet confidences, access, and those sorts of things.
I think in opening government, we've made an enormous amount of progress, but the basic structures of government are those of the 1980s, and so we have to look at layers; we have to look at occupational groups and categories and how work is organized. That is not going to be an easy task. It's largely a matter of collective bargaining, and it's not going to be easy to change, but I do think it would be worth it. I don't expect to be around to see the end of that process, but I do encourage you to take a serious look at it.
I think there are enthusiasts and there are resisters out there, as there are in life. I commend for creating the Canadian Digital Service. My report gives lots of examples of moving things to digital platforms successfully. You probably haven't heard about them, because they were on time, on budget, and fully functional.
The airport kiosks that are operated by the Border Services Agency, the electronic travel authorizations that allow people to apply for alternatives to visas, the installation of Environment Canada's supercomputer, the replacement of the mainframe underneath the employment insurance system, which was completely replaced without dropping a day of work, are all technology success stories, and you probably haven't heard of them. It's not a complaint, but your eyes are drawn through the feedback loops to the things that didn't work as well.
There is a lot of opportunity to move government services to smart phones and the way that Canadians want to get services. We're very good at the external services. I would argue we're one of the best public services in the world, and we are serving Canadians in the way they want to be served. Eighty per cent of the interactions of Canadians with their government are now on the Internet, about 20% are by phone, and maybe the rest are walk-in services. We're good at digital government services. We are not good at internal services like pay, finance, and other things. What we do to each other as public servants needs the same hacking and the same digital approach, and I'm very happy that wants to take that on in the specific area of the pay system.
Again, I wasn't here in the earlier days. I may sound like it, but I'm not being as pushy as I usually am in terms of my opinion.
I could live with our going ahead with the Phoenix chapter, just because we shouldn't lose it. I think your points are well taken, Chair. This affects a lot of people. They don't want us pushing that off, so I don't think we lose a lot....
My preference would be to make the switch, and maybe we could ask the deputy if they could help us out and make that switch. That would allow us to have the best process, which is that immediately following the Clerk—and we thank you for being here today, sir—we would have the AG to respond. That would be ideal.
Given the importance of it, Chair, especially with the way you framed it, if we can't get them here for the 19th, then I would suggest that maybe we'd be okay to stay with the 14th, but let's be sure we can get the—
Of course, I would have liked to have this discussion after Mr. Wernicke's appearance. His presence is important and I would have liked to continue the conversation.
That said, I would just like to clarify something. Clearly, our objective was to review the report on the Phoenix pay system with the deputy ministers and associate deputy ministers of the day. The report pertains to problems identified before the Phoenix system was launched.
Today, on June 14, only the current deputy minister of Public Services and Procurement Canada is appearing before the committee; that was not our original objective. We wanted access to the deputy minister of the day in order to discuss with him the problems identified in the report.
I still haven't heard anything that suggests we can't do what Madam Mendès has suggested.
If the deputy minister, on the 14th, wants to score some brownie points and help us out and move to the 19th, she can, but if not, my suggestion was that we stay with that meeting, but on the 19th let's set aside the idea of the previous deputy ministers and get the AG in.
That way, assuming we don't rise before June 22—which is not likely, given the current mood in the House—we could still go ahead, have the meeting on Phoenix on Thursday, and then on the following Tuesday, June 19, hopefully the AG will be available. If the AG is not available, that's a problem, and it may be that we just can't get the AG in before the summer break. It would be a shame, and maybe we could hold a special time that we could agree on that would meet that need to tuck it in.
However, I'm not sure that wiping out the 14th with the deputy minister of Phoenix in order to have the AG come in is the right thing to do. If the DM can voluntarily move and accommodate the AG for the 14th, everything is perfect; if not, let's go with Phoenix and hope that the AG is available on the 19th, and I would just leave it because we're running out of time.
If we can't do it on the 19th, is there any way we can find an hour and 15 minutes between then and now to hold that one session with the AG, so our staff can be working on the report over the summer? It's still fluid, Chair.
Thank you, Mr. Chairman. I promise not to drag this on too long. I just want to get a couple of things on the record.
First of all, I want to thank the committee for the kind words about the public service, and also for your interest. I think there's a genuine interest around this table in making Canada's governance better, and you play a very important role there. I acknowledge that, and I actually welcome the opportunity to have exchanges with you. I will come back as often as you want and at any time you want if you want to pursue the issues around how to make an excellent public service even better.
I would commend to you to pay attention to the issues of incentives and disincentives within which people operate. I think that is the key.
I also just want to be very clear, because things get quoted and put onto videos and spread around. There was testimony of a public servant put into an attack ad last week, which troubles me, so I want to be very clear and on the record: I am not saying the public service culture is perfect. I've said on very many occasions that it can be improved, that we are risk-averse, we are process-driven and rules-driven. We need to be more nimble. We need to be more creative. We need to be more assertive.
What I take issue with is the insinuation that it is a generalized broken culture, which implies a generalized broken public service, and I have to contest that.
The picture of the public service that comes out from these kinds of exchanges and commentary, and from experts and media and otherwise, sends the public service mixed signals. We're told that we're intransigent and unco-operative, but we're also told we're too obedient to our ministers. You get the Sir Humphrey caricature of the puppet master who's manipulating ministers and running the town, and then we're told that we're too compliant and puppets of the political side and PMO. We're told that we're careless with public money and building empires without regard to costs, and then we're told that we're overzealous in staying on budget and too timid in asking for new resources. It's a confusing set of signals that the public service receives. It's a kind of Schrödinger's public service: what happens when you open the box?
My advice is where I started, which is be very careful on the diagnosis before you start prescribing remedies. I think you can be led into mistaken diagnoses very easily. There are a lot of governance quacks out there. I think it's important to listen carefully to people with some expertise in governance, in running organizations, in organizational culture and behaviour, and apply them to the public service context. You have my full co-operation and commitment to work with you on that.
The last point is about the role of this committee. You play a hugely important role in the feedback loop to a better public service. I would encourage you to create a culture at this committee where it is possible to disagree with the Auditor General, to challenge the analysis, challenge the conclusions and the opinions. We have been trained over a decade or more that the only acceptable response to an Auditor General chapter is “We agree”, and then you play with the margins of “We agree, but” and try to get some other issue in. It should be okay to challenge the analysis and the findings of the Auditor General. It will make for a healthier, richer debate and a much better sense of solutions and so on.
I hope that I'm not in too much trouble for disagreeing with the findings of the Auditor General. I don't think it was an incomprehensible failure. I think it was comprehensible and I don't think we have a broken culture.
Thank you, Mr. Wernick.
I would add just one quick thing. In your closing comments there is this misunderstanding, sometimes, that much of what you've discussed is what we deal with here, and it isn't.
There is a government operations committee, as you know, that is responsible for much of that. What we are responsible for, predominantly, is to review the Auditor General's reports and to then work with the deputy ministers to see action plans. I will add, in regard to us, that whether or not we always agree with the Auditor General, I have as yet seen very few deputy ministers who have ever disagreed with the Auditor General, so I think it works both ways.
Anyway, we thank you for your appearance here today. We are now adjourned.