[English]
Good morning. It is a pleasure to appear before this committee for the first time since my appointment as deputy minister of Public Works and Government Services Canada, which was not quite six months ago.
I have my briefing book with me and I will now introduce my officials who are with me at the table today. They are people who are familiar to you: Alex Lakroni, who is the chief financial officer and assistant deputy minister; John McBain, who, as of yesterday, was appointed special adviser to the deputy minister.
Just a word on that change, Mr. McBain was, until last Friday, assistant deputy minister, real property, but as a transition to his eventual retirement, I was able to convince him to continue to provide me with his expertise and experience for a little while yet. He looks great. I'm grateful to him to have agreed to this assignment and for his appearance before you today.
His successor, whom you also know, Pierre-Marc Mongeau, is also here today, sitting behind us, to address any questions on the parliamentary precinct projects and plans. He is being replaced by Nancy Chahwan, who is also here.
[Translation]
So we are ready to answer your questions pertaining to our 2013-2014 main estimates and report on plans and priorities.
Although the knowledge I acquired at the Treasury Board Secretariat will stand me in good stead in my new role, I understand that taking the reigns of Public Works and Government Services Canada is quite a responsibility. This role is very dear to me, both for its important capacity as service provider and for its government-wide responsibilities.
I believe that centralized service delivery agencies enable the government to benefit from significant improvements in terms of productivity, efficiency and economies of scale. These agencies also help the government standardize a number of administrative functions to best leverage the private sector by providing practical common solutions. By releasing departments from having to perform daily activities, these agencies enable them to focus on their mandates and priorities.
[English]
PWGSC plays a key role in the operations of the federal government. As its treasurer, accountant, central purchasing agent, linguistic authority, and real property manager, the department is home to the Receiver General, prepares the annual public accounts of Canada, and manages a cash flow of more than $2 trillion a year in support of that role. It accommodates more than 270,000 federal employees in a diverse real estate portfolio that comprises almost 1,800 locations across Canada. It manages and oversees the lion's share of government procurement, which contributes more than $14 billion annually to the Canadian economy, translates more than one million pages of text on behalf of federal organizations, and provides translation and interpretation services for Parliament.
For the 2013-14 main estimates, PWGSC's gross budget is $5.9 billion, broken down as follows. There is $2.4 billion for the rent, fit-up, and utilities of government-wide accommodation; Receiver General and central compensation administration functions such as banking fees, cheques, and envelopes; and translation services to Parliament. There is $1.9 billion related to providing optional services to departments, such as real property project management and translation services, on a cost recovery basis. We need $900 million to deliver our core programs such as central purchasing and banking, public accounts, payroll, and pension services. We need $600 million in capital for Government of Canada buildings and infrastructure.
PWGSC generates $3.3 billion in revenues, or 56% of its budget, from client departments. This results in a net appropriation of $2.6 billion. The 2013-14 main estimates represent an increase of $254 million, or 4.5%, over last year's main estimates. One of the key reasons for this increase over last year's estimates is the amount allocated to the rehabilitation of the Parliament Buildings. Work continues so as to ensure their preservation as heritage assets and national symbols, and as functioning buildings that are essential to the continuity of our national democratic institutions. The total 2012-13 estimates earmarked $247 million for the parliamentary buildings rehabilitation projects. For this fiscal year, the allocation is $261 million—an increase of $14 million as per approved project plans and schedules. The parliamentary precinct's west and east blocks are included in the rehabilitation projects for 2013-14. All major projects, including the major rehabilitation of the West Block and 180 Wellington Street, are still on or ahead of schedule and on or under budget.
[Translation]
Another factor contributing to the increase in our 2013-2014 main estimates is the purchase of the Terrasses de la Chaudière complex in Gatineau. The amount of $50 million would be added to our budget to complete the transaction.
During this period of downsizing, such a purchase might seem odd, but this is not a new space for the government because we already occupy the entire complex: nearly 8,000 government employees work at Terrasses.
As well, the Government of Canada had entered into a long-term lease-purchase agreement during the construction of the complex. We have earned equity through lease payments and improvements carried out over more than three decades.
The purchase also allows us to maintain the 25/75 distribution of office space between the cities of Gatineau and Ottawa.
In addition, this purchase would enable us to exercise the option contracted when the buildings were built and leased and is an excellent investment for the crown and taxpayers.
[English]
Another increase is $32 million required for the transformation of the pay administration initiative, support for the implementation of the consolidation of pay services in Miramichi, New Brunswick, and modernization of the government's 40-year-old pay system. This aligns with economic action plan 2013's emphasis on standardizing, consolidating, and transforming the way government does business to improve services and deliver efficiencies to Canadian taxpayers. These additional funding requirements are offset by PWGSC's commitment to realize its share of total government-wide savings initiatives.
This year, PWGSC will realize additional savings of $95 million, of which $67 million is associated with our 2010-11 strategic review and $28 million results from budget 2012 expenditure review savings. These efficiencies and productivity improvements are in support of the Government of Canada's commitment to ensure a return to balanced budgets. Maintaining a sound fiscal position is the most important contribution the government can make to bolster confidence and growth, and Public Works and Government Services Canada is proud to contribute to this effort.
Having set out the highlights of our main estimates, I will turn now to how these would be expended, once supply is provided by Parliament, in support of the priorities set out in our report on plans and priorities for fiscal year 2013-14. The department has one strategic outcome: high-quality, central programs and services that ensure sound stewardship on behalf of Canadians and meet the program needs of federal institutions. Seven programs support that outcome, and both the main estimates and the report on plans and priorities set out the planned allocations for each of these programs.
The department's top three organizational priorities for 2013-14 are delivering efficient and effective services, transforming critical infrastructure, and ensuring sound stewardship and management excellence.
[Translation]
Federal departments and agencies, along with many stakeholders from the private sector, rely on Public Works and Government Services Canada for the delivery of effective and value-added services.
Our priorities therefore include improving and streamlining procurement processes in ail categories of goods and services, implementing the National Shipbuilding Procurement Strategy, completing the government's seven-point plan to replace fighter jets, improving the management of our real property portfolio, consolidating pay services and modernizing the computing platform to reduce costs, providing more standardized services to small agencies to help them reduce operational costs, and reducing the administrative burden for companies in the Industrial Security Program.
All of our service offerings and priority activities focus on improving performance, increasing consistency and efficiency of offer, and reducing costs for departments and agencies.
[English]
My second priority, transforming critical infrastructure, encompasses all the work to rehabilitate and preserve the buildings in the parliamentary precinct through the long-term vision and plan; delivering on a substantial program of work for our engineering assets, including something I was not aware of until I arrived at the department, portions of the Alaska Highway, for which we are the custodians; and leading the workplace 2.0 initiative for the government, which includes updating workspaces, and with Shared Services Canada, enabling technologies and work processes that create a more efficient and productive work environment.
Our third priority, ensuring sound stewardship and management excellence, speaks both to our goal to drive efficiencies within our own departmental internal services and to the stewardship role we play in ensuring the integrity of the procurement and contracting processes, which we manage for federal departments and agencies.
Safeguarding the public trust in Public Works and Government Services Canada is a priority for me and for all our employees. The department has been working diligently to protect the integrity of its operations, and more specifically, its procurement processes. Our goal is to ensure that we conduct our business to the highest ethical standards, which Canadian citizens expect us to uphold and protect.
We have a strong framework in place to support accountability and integrity in procurement. This includes a code of conduct, fairness monitoring, audits, internal investigations, policies, procedures, and governance measures. I understand we will have a chance to discuss these in greater detail at an upcoming appearance before this committee as you undertake work in this area,
In closing, Mr. Chair, members of the committee, I have come to appreciate that sound financial management is a hallmark of Public Works and Government Services Canada. We are entrusted with a large mandate, and we manage significant sums of money. We will continue to exercise financial leadership, seek efficiencies, improve service delivery, and identify opportunities for additional savings. I can assure you that our department strives to ensure consistent delivery of high-quality services to Canadians while providing value for money for taxpayers.
Mr. Chair, members of the committee, thank you for your attention. My colleagues and I will be pleased to answer your questions.
:
Thank you, Mr. Chairman.
I'm pleased to be here today to discuss the main estimates and the report on plans and priorities for Shared Services Canada for 2013-14.
I'd like to begin by introducing the officials who are here with me today at the table. Gina Rallis is the senior assistant deputy minister and chief financial officer, and Benoit Long is the senior assistant deputy minister for transformation, service strategy, and design.
First with respect to the main estimates, I would note that the main estimates for Shared Services Canada for 2013-14 represent a total of $1.398 billion. This is a decrease of $121 million, as compared to the 2012-13 estimates to date, which amounted to $1.519 billion. That decrease is attributed to reductions of $89.6 million as a result of budget 2012 expenditure review savings, as well as further net adjustments to and from various partnering departments in support of Shared Services Canada's mandate.
[Translation]
As members of this committee know, Shared Services Canada was created in August 2011 with a mandate to consolidate, standardize and streamline the delivery of Government of Canada email, data centres and network services. The report on plans and priorities sets out the priorities we have established in order to make progress on that mandate in 2013-2014.
[English]
The organization's very first report on plans and priorities was tabled in 2012. It included four broad priorities and 42 plans for meeting these priorities. With the support of all its employees, and in consultation with partner departments and other stakeholders, Shared Services Canada was successful in meeting its goals for the 2012-13 fiscal year. We maintained operations across the extensive IT infrastructure, supporting approximately 2,100 mission-critical systems, and also reached the planned milestones in our transformation of the government's e-mail system, data centres, and telecommunications networks. We implemented internal management processes to deliver lean corporate services, including collaboration with other departments to establish our financial and HR systems.
I'll be pleased to respond to any questions about those results, but first I would like to take the opportunity to describe briefly the highlights of our plans for this coming year.
The first priority I'll mention is to maintain and improve the delivery of IT infrastructure services. IT infrastructure is critical to the delivery of the government programs and services upon which Canadians and businesses depend every day. SSC has the responsibility to make sure that infrastructure is as reliable and as secure as possible.
In our second full year of operations, we will be seeking to move beyond the status quo operational models that we inherited from our 43 partner departments in order to bring greater horizontal alignment to service and support. We will place a particular focus on identifying the ways in which taking a government-wide approach can enhance IT security.
Mr. Chairman, the second Shared Services Canada priority is the renewal of the Government of Canada's IT infrastructure.
[Translation]
The email transformation initiative is the most advanced of our renewal strategies. After extensive preparatory work and consultation with government departments as well as the information and communications technology sector, we are in the final stage of a procurement process that will result in the implementation of a single government-wide email system by 2015.
We will work closely with partner departments and our own employees through the coming year to plan and manage a transition that is as smooth as possible for our partners and the Canadians that they serve.
[English]
The plan to consolidate the Government of Canada's data centres and to transform our network services is also taking shape. We have conducted a comprehensive analysis of the current state of our operations and assets, and have engaged extensively with partner departments and the private sector to identify our future business requirements and to learn from the experience of other organizations that have undertaken similar efforts. As a result of this work, we will be in a position this year to finalize a transformation plan and to begin its implementation.
In addition, as announced in economic action plan 2013, Shared Services Canada will dedicate $20 million of our existing funding to improve the government's capacity for telepresence and other comparable technologies to support measures to replace travel with remote meeting alternatives. As part of this initiative, SSC will monitor the use of the government's video conferencing facilities and work with the Treasury Board Secretariat to ensure that the facilities are used to the greatest extent possible.
The third priority for Shared Services Canada this year is to promote effective engagement with partner departments. Sound governance and effective engagement are critical in any shared services' initiative and particularly so when the initiative involves changes in processes, services, and technology that will have an impact on organizations and employees.
Shared Services Canada has established structures and mechanisms that provide for information sharing, consultation, and involvement at all levels of our partner organizations, from working groups that contribute to the planning of individual initiatives to bilateral meetings with deputy heads of departments and agencies.
The value of this engagement is not limited to the planning and execution of our own transformation initiatives. It is equally important for Shared Services Canada to participate in the project planning that is under way in partner departments to make sure that we are able to provide the IT infrastructure support that their own initiatives and investments will require.
SSC's fourth priority is to ensure that we have efficient and effective business management processes and services. In the first 18 months of its existence, Shared Services Canada built a new department from the ground up. That work continues, Mr. Chairman. As indicated in our report on plans and priorities, our plans in support of this priority extend across a wide number of areas of responsibility, including human resources and financial management, procurement, accommodation, auditing, and evaluation.
With respect to human resource management in particular, we're implementing a workforce management strategy that focuses on ensuring that our employees have the skills to contribute as our priorities and operations evolve. Through this strategy and other business systems and processes that we are implementing, we aim to ensure that Shared Services Canada performs efficiently, effectively, and with the necessary management rigour.
[Translation]
In conclusion, Mr. Chair, I would like to emphasize that the plans and priorities that have been established for Shared Services Canada in 2013-2014 will enable the department to continue to deliver effective and efficient IT infrastructure services to its 43 partner organizations, even as it plans and executes the consolidation and modernization of the government’s email, data centre and network services.
[English]
Thank you, Mr. Chairman. My colleagues and I look forward to answering the questions.
We have undertaken a substantial review of a number of categories, for example, of goods and services. We have 31 major categories, and we are going through an extensive review process for each one of them, engaging with industry.
One of the comments we received was that when we pull together supply arrangements or standing offers, they tend to be for a length of time and companies don't have an opportunity to either refresh or update their information, and we don't have an opportunity except when we have to re-compete these on a three-year, or depending on the length of the arrangements. We have worked with companies and various suppliers to ensure that we can, in fact, refresh them on an ongoing basis and have them done on an as-needed requirement. I think this is one of the key areas where we have significantly improved our processes, so that departments and suppliers aren't left with a static set of supply arrangements for suppliers on those lists.
The other aspect I spoke to earlier was industry engagement. I did commit to providing information on how we do that. We have extensive consultations because we want to be part of the business cycle of companies, and we want to be part of the requirements cycle of our client departments and agencies. We have to make sure the supply and the demand are meeting each other's requirements, at an opportune time. We have taken steps on a number of these categories of supply, or of procurement activities, and we are working our way through them. I think we have found, up to now, that has received good input from companies, from suppliers, and from our client departments and agencies.
We've also streamlined a couple of major procurements, where we have looked at, for example, shared travel services. My colleague talked about video conferencing, but we still travel. Therefore, being able to drive the best price and the most effective way of getting at your travel services.... We have been able to obtain the services of a supplier that would allow us to have some very competitive rates. But that was generated as a result of a fairly extensive discussion with our client departments and agencies, to get at what their requirements and essential needs are.
We were able to then engage with suppliers to have a better conversation about what they could provide us in services in a timely fashion.