A QUEST FOR BALANCE
Notes for an Address by
Jocelyne Bourgon
Clerk of the Privy Council and Secretary to the Cabinet
Gow Lecture
Queen's University
Kingston, Ontario
April 25, 1997
INTRODUCTION
Thank you for your invitation. I warmly welcome the opportunity to share some thoughts
with you on the importance of public service.
Queen's University has had a strong presence in the development of the Canadian public
service. It has produced some of the best public servants in our history. And -- thanks to
the contribution of people like Donald Gow -- Queen's has, over the years, pushed back the
frontiers of knowledge to the advantage of Canada, its governments and its citizens. It is
fitting, therefore, that the University would wish to honour Donald Gow's memory and
continue its contribution to public service through the Gow Lecture.
For the past 15 years, Canada has been engaged in a process of realigning the role of
government. Some governments started earlier; others joined the effort more recently. But
movement is under way toward the goal of balancing their budgets.
After so many years of effort and public debate about "less government":
- We are running the risk of losing sight of the importance of government in a
well-performing civil society and of misunderstanding the importance of the role that
government will be called upon to play in the future.
- We are running the risk of ignoring just how much change has taken place in the public
sector and the potential it holds for the future.
- We are running the risk (and that would be the most serious consequence of all) of
discouraging those who would otherwise want to pursue a career dedicated to the public
interest.
We need to keep a sense of balance and perspective.
I will talk to you tonight as a practitioner -- one who has spent many years managing
public sector organizations through a process of downsizing, change and re-engineering.
One who has the good fortune to start each day with the same sense of excitement, pride
and admiration for the work done by the public servants of Canada that I had when I began
24 years ago -- and with the same feeling that there is no greater reward than the
opportunity to make a difference in the life of one's country.
I. THE QUEST FOR BALANCE
1. Is the Pendulum Swinging Again?
As we come close to the end of the 20th century, democracy working together with a
market economy stands as the uncontested model of societal organization.
Nobody knows how to run a successful economy other than through a market economic
system. It is the most efficient way to use scarce resources and to ensure the pursuit of
individual interests.
Democracy for its part has proven to be the best way to ensure social cohesion and the
peaceful development of consensus. It is the most efficient way to ensure the pursuit of
the collective interest.
There are other models to be sure:
- Some countries have had faster growth but without the quality of life, the protection of
civil liberties provided by democratic institutions.
- Others had greater emphasis on the collective good but without the wealth generation or
the economic growth that a market system provides.
Overall, the countries with the benefit of both systems have outperformed all others.
There are inherent tensions between democracy and a market economy. Both systems are
rooted in very different beliefs:
- One is about the collective interest, the pursuit of egalitarian values reflected in an
electoral system of one person, one vote.
- The other is about the individual interest, the survival of the fittest.
But the history of the 19th and 20th centuries has also taught us that there are great
synergies between the two systems. They can be mutually supportive and mutually
beneficial:
- The market economy and its supporting private sector institutions, providing wealth,
growth, employment, rising real wages.
- Democracy and its supporting public sector institutions, providing the legal framework
for a peaceful life in a civil society, the pooling of resources to meet collective needs
and the environment that allows the market economy to flourish.
For countries, such as Canada, that are fortunate enough to have the benefit of both
systems, it is not a matter of one sector triumphing over the other. It is a matter of
balance.
In a magazine article, Henry Mintzberg points out that the conclusion reached in the
West about the collapse of the Communist regimes of Eastern Europe was that
"capitalism has triumphed." But he goes on to say:
"Capitalism did not triumph at all; balance did. We in the West have been living
in balanced societies with strong private sectors, strong public sectors and great
strength in the sectors in between." [Henry Mintzberg, "The Myth of Society
Inc.," Report on Business Magazine, October 1996, p. 113].
Citizens decide where the balance lies at any given time. In societies like ours, the
quest for balance is never over. The point of equilibrium is forever changing as
circumstances evolve and new societal consensus emerge.
In Canada, we have seen the signs of this quest for balance, as the pendulum has swung
between greater emphasis on collective needs and public interest at some times and greater
emphasis on individual interests and the market economy at other times.
From World War II to the late 1970s, citizens asked progressively more of government
and of the public sector -- from nation building, to managing macro-economic policies, to
creating a social safety net, to expanding the regulatory regime in all sectors and all
aspects of life.
Great results were achieved, but the dream did not materialize. No amount of regulation
could protect citizens from every negative occurrence in their life. Governments and
government intervention could not protect Canadians from the effects of economic
recessions, could not create the jobs, could not simultaneously fight inflation and high
interest rates. The role of government has its limits and the cost of government was
exceeding Canadians' collective means. A new equilibrium was needed.
Through the 1980s and 1990s, citizens asked progressively more of the private sector.
Less government; balanced budgets; freer trade domestically and internationally;
modernized taxation regimes; reduced regulations were among the many measures needed to
reap the benefits of a well-performing market economy. Great results were achieved, but
once again the dream did not materialize.
During this period, Canada had one of the best growth records of the G-7 countries. But
even the best sometimes is not good enough. An average economic growth of 1.3% through the
1990s means a drop in citizens' standard of living. Unemployment reached an average of
10.1% in the 1990s and it currently stands at about 17% for youth. The gap between young
people and the rest of the labour force is excessively wide. Real per capita disposable
income has declined each year since 1988.
The dream of constant growth, full employment, financial stability and rising real
wages proved illusive.
There are signs that the pendulum is about to start swinging again -- in search of a
new equilibrium and a new dream to fulfil.
Once again citizens will decide where the new equilibrium will lie in the years to
come.
Wherever the new equilibrium lies, there will be a synergy between the best of
democracy and the best of the market economy; a balance between the pursuit of individual
and collective interests; a partnership between the public sector and the private sector.
This partnership will, to a large extent, determine how successful Canada will be as a
society as we enter the new millennium.
2. The Role of the Public Sector
A lot has been said about the changing nature of the market economy in a global
environment. The importance of the role of the public sector in a global environment is
less well understood. I will, therefore, limit my remarks to that aspect.
In March 1996, Alice Rivlin, the chair of the OECD Ministerial Symposium on the Future
of the Public Services, said in her closing statement that "the quality and
effectiveness of 'governance' is crucial to national prosperity." [OECD. Public
Management Service, Ministerial Symposium on the Future of Public Services, (Paris:
Organisation for Economic Co-operation and Development, Public Management Service, 1996)
p. 8].
I share that view.
And I would add that, in a global environment, it will increasingly be the case. As the
new equilibrium takes shape, I believe that the public sector will be called upon to play
a very key role. Let me tell you why.
(1) Private Investments
In the industrial age, many industries had a natural home base -- the result of the
location of natural resource and easy access to capital, a labour force, and markets.
While this will continue to be the case for some time for some industries, it is changing
for many others.
Modern technology, world capital markets, and an inexpensive means of communications
mean that more and more industries do not have a predetermined home base.
In this environment, a country's success will be achieved by creating economic and
social conditions that are more attractive than those offered by other countries. A
peaceful society with a modern infrastructure and a world-class work force -- a society
that is prepared to invest in its people and in research and development -- will have an
important comparative advantage.
In the future, a nation's comparative advantage will be created by what it does and the
investments it makes. It will not be inherited. This calls for a key strategic role for
government and the public sector.
(2) Knowledge and Skills
Knowledge and skills, and the ability to put knowledge and skills to work, will
progressively stand out as one of the most important comparative advantages of nations. It
will be key to productivity gains and to innovation in all sectors, old or new. More
importantly, it will also be key to citizens' success and sense of security.
Unlike natural resources, which were given to some nations in greater abundance than to
others, knowledge and skills and the ability to effectively use them do not just exist.
Acquiring them takes time and sustained investment in education and training. There again
the public sector will be called upon to play a key role. As we all know, no country has
ever become even semi-literate without a publicly funded school system.
(3) Quality of Life
In a global environment, firms and countries alike will compete to retain and attract
the human capital -- the brain power -- critical to their success and their future.
Some are of the view that all it takes to attract and retain talent is wages and
salaries. I think this view underestimates the diversity of human needs.
Safe streets and neighbourhoods, clean air and water, good schools for children,
world-class learning institutions, modern health care, and a peaceful society will all be
significant factors in the competition for talent. There again the public sector
contribution will be significant.
(4) Public Investment
The public sector has always played a role in making key investments in advance of
market potential.
It once took the form of canals, railways, airports and roads. It then took the form of
telecommunications, telephone services and satellites. These investments have contributed
to Canada's competitiveness and will in the future:
- A recent example of public sector investment in advance of market potential is the
Internet. It was developed by the U.S. Department of Defence and operated for almost 20
years before its market potential was realized.
- In Canada, it took 20 years of development in government labs and universities before
Canola, now a $2 billion industry, became marketable.
So let me summarize. As Peter Drucker was quoted in a newspaper article: "We are
learning very fast that the belief that a free market is all it takes to have a
functioning society -- or even a functioning economy -- is pure delusion . . . . The
market by itself does not produce democracy and does not even produce a healthy and
growing economy." [Peter Schwartz and Kevin Kelly, "Relentless contrarian,"
The Ottawa Citizen, December 31, 1996, p. A11].
Whatever the new century may hold, whatever citizens decide about the proper
equilibrium over the next period of time, we can be sure that government and public sector
institutions will have a key role to play, one that holds the promise of a strong public
-- private sector partnership.
II. THE EVOLVING PUBLIC SECTOR
By now you should all be convinced, I hope, of the importance of the role that the
public sector will be called upon to play in the future. Let me now say a word about the
state of the public sector.
Nothing less than a quiet revolution has been under way in the public sector in Canada
over the last few years. The changes have been so vast, so fast, and so profound, that
very few people, including experts, have a clear understanding of the reality today in the
public service.
First, let's review some facts. Five years ago Canada was facing a serious fiscal
problem both at the federal and provincial levels.
In 1992-93, the aggregate federal-provincial-territorial deficit had reached 9.6% of
GDP. Today, seven provinces have balanced their budgets, and five of those are repaying
their debt. The combined federal-provincial-territorial deficit has been cut by 50%.
At the federal level, the deficit stood at nearly 6% of GDP in 1993-94. Today, a zero
cash requirement (the amount of new borrowing from financial markets) is in sight. By
1998-99, federal program expenditures (which includes all federal spending except interest
payments) as a percentage of GDP will be at the lowest level since 1949-50.
There is room to debate the pace of reduction or the policy choices to bring about
these results. But we should all agree that a remarkable turnaround is taking place in
Canada.
For the first time, in a long time, there is light at the end of the tunnel; and if
governments stay the course, it will mean that
- This generation of Canadians will not leave a legacy of growing debt to the next
generation.
- Governments will have collectively taken the essential steps toward regaining their
fiscal sovereignty and their capacity to invest in the future of the country.
- Citizens will have regained the ability to make choices about the kind of society they
want for the future. And this will lead to a fascinating political and policy debate.
The magnitude of the transformations under way and the pace at which they are occurring
are unprecedented since World War II. Time will tell if the right decisions have been made
and the right balance has been achieved, but it is already clear that an exceptional story
about reinventing the role of government is being written in Canada.
For most Canadians, the most visible sign of the changing role of government has been
"less government," but a more careful look reveals that more profound changes
are under way. They involve
(1) New relationships among governments
(2) New partnerships
(3) A different relationship between government and citizens
(4) A stronger policy capacity
(5) A renewed institution
Each one holds great promise for the future. Let me explain:
(1) New relationships among governments
The realignment of roles by all governments in Canada has substantially reduced the
degree of overlap and duplication among governments that existed even a few years ago.
Today the public debate on overlap and duplication is lagging behind the reality of
change in Canada. Many of the issues of concern to premiers during the Charlottetown
negotiations only five years ago have either been resolved or are being addressed.
But no amount of streamlining or downsizing will ever replace the need for governments
to work together to meet the needs of Canada and Canadians in the 21st century. While
governments have a role to play in their own right, they must learn to set priorities
together, and make decisions together.
In other words, the work on clarification of roles and on overlap and duplication is
now giving way to a much more challenging phase -- the management of interdependence among
governments to serve Canadians.
At the same time another major transformation is under way. All across the country,
away from the limelight and the attention of the media, governments are coming together to
provide integrated services to citizens. The concept of single window is becoming a
reality in Canada. Examples can be found right across the country:
- In Prince Edward Island, the federal and provincial governments have entered into a
knowledge-economy partnership agreement, which also involves the private sector and
educational institutions.
- Through the Environmental Industry Virtual Office, federal and provincial governments
and the private sector are using the Internet to provide, under one roof, virtual access
to experts and information on the environmental industry. In Quebec, for example, the
"office" has 18 partners including federal departments, agencies and Crown
corporations; provincial departments and agencies; business associations; regional
economic development groups; and the City of Montreal.
- In Ontario, the Toronto Harbour Remedial Action Plan (Toronto RAP) is a partnership of
four federal departments, three provincial departments, over 20 regional and municipal
governments, commissions and authorities, environmental organizations, businesses and
citizens, all working to rehabilitate the Toronto waterfront.
- In Alberta, a pilot project in the dairy processing sector amalgamates federal,
provincial and municipal dairy inspection services. An interagency working group,
consisting of the federal and provincial governments and 17 regional health authorities,
is exploring ways of working to rationalize the food inspection services in other
agricultural sectors.
- The Canada Business Service Centre in British Columbia is a fully integrated partnership
between the federal and provincial governments, providing a "seamless" one-stop
service for business information from 27 federal and 18 provincial agencies.
This trend will continue to accelerate. Ultimately, it could bring together the
federal, provincial and municipal governments in providing seamless services to Canadians.
(2) New partnerships
The approach to governance is also changing. For the public interest to be well served,
government does not need to do it all. The pursuit of the public good is not the exclusive
prerogative of governments. The private sector, not-for-profit organizations, the
voluntary associations, and citizens all have a role to play.
Governments are learning fast and are entering into partnership arrangements with
non-government organizations that allow partners to achieve results that would be well
beyond their reach if they were acting on their own.
This is leading to an explosion of institutional models unknown even a few years ago.
If your vision of the organization of government today is the traditional departmental
model, look again:
- You should see government agencies providing services on behalf of several departments
and several governments. The Food Inspection Agency and the upcoming revenue agency are
two examples.
- You should see not-for-profit organizations as a form of private-public partnership. The
Air Navigation System is a multiple public and private sector partnership. Forintek is a
multiple partnership involving the Government of Canada, six provinces and 155 private
companies. The Canadian Tourism Commission is a multiple public and private partnership.
- You should find virtual organizations -- a service agency without walls and without
staff, one business plan, one budget, one report to Parliament on behalf of departments
working together in a co-ordinated fashion.
This transformation is not without problems but the trend is here to stay. Flexibility,
adaptability and efficiency need not be foreign to public sector services.
(3) A different relationship between government and citizens
The use of information technology is transforming the relationship between government
and citizens.
This change will likely have the most profound impact on the role of governments in the
years to come. Canada is at the leading edge of this transformation.
The use of information technology is allowing government to be present, relevant, and
adapted to local needs everywhere in Canada:
- Human Resources Development Canada is delivering services electronically at about 5,000
kiosks in offices, shopping malls and even universities across the country. This
networking is comparable to that of Canada's largest financial institution, which has
about 4,700 automated teller machines.
Technology is changing the nature of the services provided. It is also putting citizens
in control:
- Strategis is an electronic information network for businesses and enterprises. It was
created only a year ago. It holds 665,000 electronic documents: 3 billion bytes of
statistical data. There are 200,000 hits per day; and 8.5 million electronic documents
have been retrieved to date. Access is growing on a monthly basis.
Technology is allowing government to provide services that could not be provided
otherwise and is connecting Canadians and Canadian communities:
- SchoolNet will link all of Canada's 16,500 schools and 3,400 public libraries by 1998.
- TeleHealth and TeleLearning are already a reality in Canada in several remote
communities.
(4) A stronger policy capacity
The role of the public service is not limited to service delivery. Providing high
quality policy advice to ministers and government is just as important.
While this would justify a speech in its own right, in the context of our exchange
tonight, I would simply note that the quality of the policy work currently under way in
the Public Service of Canada is the best that has been produced over the last 15 years --
not because we are suddenly brighter, but because the focus is on medium to long term,
because it is driven by an interdepartmental team bringing to bear the expertise of every
department, and because it is valued. The importance of this work is recognized.
(5) A renewed institution
I said earlier that a "quiet revolution" is under way but that the public
service is also facing a "quiet crisis." There is growing evidence that it could
be increasingly difficult to retain, motivate and attract people essential to the public
service over the coming decade. It is a matter that we are well aware of and that we are
acting on. I have dealt with this in my annual report to Parliament, and while it is a
subject of great importance, I will not expand further on this issue tonight.
So, let me now summarize the second part of my report:
- We are coming out of a phase which has seen important changes take place in the public
sector in Canada.
- A phase during which governments have realigned their role, moved to balanced budgets
and regained the capacity to invest in the future.
- A phase which has brought about less government but has also modernized government. A
public sector that is different from the one we have known in the past is emerging.
My first conclusion is that, as we get closer to the new millennium, government will be
called upon to play a crucial role.
My second is that the Public Service of Canada will be ready to face the challenges of
its time. In a global environment, government and the public sector can successfully
integrate global and local needs -- can reach citizens and be accessible like never before
-- can connect citizens and communities. Government can contribute to collective needs and
social cohesion in ways that were unthinkable just a few years back.
III. LOOKING AHEAD - A CAREER LIKE NO OTHER
My initial inclination, at this point, was to map out some of the key challenges that
governments and the public sector will need to address over the coming years.
But, so late in the mandate and possibly close to an election, this could prove to be
foolhardy. It is much better to leave it to elected officials and candidates to engage in
a debate with Canadians over government priorities in the context of the upcoming national
election.
Let me instead look 10 years ahead. There are men and women in this room who will be in
the Public Service of Canada 10 years from now. I would like to talk to them for a minute
and describe the world through their eyes.
- You will be confronted by challenges of great complexity, many of which cannot even be
imagined today. You will often feel inadequate to the task and overwhelmed by the
responsibilities, but humility and modesty will serve you well. The "arrogant"
misjudge their true impact and the "incompetent" do not understand the
consequences. Neither make good public servants.
- You will discover and celebrate the courage of ministers and the dedication of elected
officials. Nothing of any significance can be done without the will of ministers. But any
government is seriously handicapped unless it can count on a competent and professional
public service.
- You will discover with excitement that you make a difference -- great policies, great
initiatives are conceived by people just like you. They affect the quality of life of
Canadians and the performance of Canada in the world.
- You will be given the opportunity to contribute to the limit of your own potential. You
will work with men and women equally talented and equally committed. You will learn and be
challenged more than you can imagine.
- Your role as a public servant will be looked upon with pride and respect. You will enjoy
the trust and confidence of Canadians. No one, to be sure, will join the public service to
become rich. But public servants will be provided with general conditions that will allow
them to pursue a career dedicated to the public good while enjoying a decent standard of
living and putting their children through university. The men and women serving before you
will have worked relentlessly to hand you a modern and vibrant organization and to ensure
that the scrutiny, criticism and deteriorating conditions of their time have been
resolved.
- Like the men and women who served before you, you will be called upon to contribute to
the social cohesion of Canada. Like your colleagues in other industrialized countries, you
will worry about issues such as
- The ability of all citizens to share in the benefits of living in Canadian society
- Disparities in income, knowledge and skills
- Intergenerational tensions
- You will be asked to discover and shape initiatives that will give Canada an edge in the
community of nations 10 or 20 years later:
- The importance of education, continuous learning, skill upgrading, R&D and
information technologies is already predictable. The issue is what else? What lies beyond
what we can already foresee?
- Like the men and women before you, you will be called upon to contribute to the national
unity of Canada:
- Those serving before you will have helped to ensure that all Canadians celebrated the
millennium, proud of their past, confident in their strength and optimistic about their
future.
- From there, every day, you too will be called upon to contribute to national unity.
After all, the glue that keeps countries together is the desire of its citizens to share a
future together, and your work contributes to a better future.
One day -- after several years of a challenging and rewarding career you will write a
speech on the importance of the role of government and of the public sector in a
well-performing civil society.
And the quest will go on.
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