Remarks by the Clerk of the Privy Council
And Secretary to the Cabinet

September 26, 2006

• Thank you, Rick (George) for that very kind introduction, and many thanks as well to the Canadian Council of Chief Executives for the invitation to speak to your National Policy Summit, especially on your 30th Anniversary.
• Tom (d’Aquino) has asked me to speak this morning about the importance of a strong, professional, non-partisan public service to a country’s success, and I welcome the opportunity to do so. Indeed, I think it is a subject that is too often taken for granted, and too little discussed in a country with a proud tradition of public service --- whether it be the military, the civil service, or elected public office.
• But, first, let me congratulate the members of the Canadian Council of Chief Executives on their 30th anniversary and recognize your many contributions to public policy discourse and policy development in Canada: whether it was interacting with government on the emerging OECD consensus on an agenda for growth in the mid-1980s, through the national debates on the FTA and then NAFTA; the need to eliminate the deficit; tax reform and then tax reduction; globalization; and more recently a secure and efficient border, business sector engagement in public policy development is essential, and the CCCE/BCNI has played an important role.
• And, both personally and on behalf of my public service colleagues, I want to recognize the extraordinary commitment of Tom d’Aquino to the value of business-government dialogue on the major public policy issues, both domestic and global, impacting on our country.

Public Policy and the Public Service Matters

• While I’ve had the opportunity to address your Policy Summits in the past, either as Deputy Minister of Industry or Deputy Minister of Finance, this is my first occasion to do so as the 20th Clerk of the Privy Council, Secretary to the Cabinet, and Head of the Public Service of Canada.
• Today, I want to focus my comments essentially on four broad points --- the four “matters” if you will:




First, public policy matters to a country’s success in this globalized world; Second, public service matters to a nation’s performance; Third, public service renewal matters, to ensure we have a public service in the future that reflects excellence and leadership; and Fourth, private sector engagement and support matters, both for public policy and public service.

• In this context, my nearly two years at the International Monetary Fund (IMF) underscored the importance of good public policies and a strong public service to a country’s success --- just look at the varying experiences of the 183 members of the IMF.

(i) Public policy matters:

• First, public policy matters. For all countries, big and small, globalization and the knowledge revolution are the realities of today. They are fundamentally changing the way we work, live and interact.
• But globalization does not preordain a country’s economic, social and security outcomes: while they may be significantly influenced by these complex global influences, the strength of public policies and public institutions matter greatly.
• In today’s global environment, countries like ours, which are relatively small and very open, have to understand global trends, global issues and global opportunities better than our larger neighbours.
• Canadian success will depend on our agility and flexibility; our capacity to learn from others; our ability to Canadianize best global practices; and our willingness to implement the right public policies at the right time. We have to think globally to succeed domestically.
• In that context, it is useful to reflect back over the last 25-30 years, the lifespan of the CCCE/BCNI, and consider the extent to which Canadian public policy has helped shaped the present while globalization was changing the international context. Let me give you four specific examples, which speak for themselves:

i.   At the start of the 1980s, the federal deficit was over 4% of GDP, debt was skyrocketing, federal spending was more than 17% of the economy, taxes were rising, and the CPP/QPP was in deficit. Today, the federal budget is balanced (9th consecutive), debt is being repaid ($81 billion); government spending is 13% of the economy, taxes are falling and the national pension system is actuarially sound (for 70 years).

ii.   In the early 1980s, the Canadian inflation rate was 12% and mortgage rates were approaching 20%. Today, we have an inflation target of 1% to 3%, low and stable inflation, and long-term mortgage rates of under 6%.

iii.  Twenty-five years ago, Canada was a $1/4 trillion (U.S.) economy, with a chronic current account deficit, rapidly rising foreign indebtedness, heavy regulation and a large productivity gap with the U.S. hampered our competitiveness. Today, we are a $1 ¼ trillion (U.S) economy, an integral part of NAFTA, with a current account surplus and a lower foreign indebtedness than the U.S. But, the productivity gap still constrains us.

iv.   As the 1980s began, security concerns related to the Cold War, terrorism was not a global concern and our spending on defence and security was on a long term decline. Today, the Cold War is over, international terrorism is our key security challenge, defence and security budgets are rising, Canadian women and men are fighting in Afghanistan, and a secure and efficient Canada-U.S. border is a key policy issue.

• The general point that emerges from these examples is that public policy can have a profound effect on a country’s present and future prospects. What choices we make in public policy affect our prospects as a nation to realize our potential.

(ii) Public service matters:

• And this is the key reason why public service matters. I believe there is a close correlation between good public policy and an excellent public service. The public service can take a longer term view on the policy challenges facing a country, and invest in the analysis to provide governments with a full range of policy options.
• Further, public service is about just that, services: it provides services impacting on all Canadians, and the more efficient and effective these are delivered, the better off we are as a country.
• In his book The Lexus and the Olive Tree, Thomas Friedman argues that “in the globalization system … one of the most important and enduring competitive advantages that a country can have today is a lean, effective, honest civil service”. In other words, public service matters, and an effective, efficient, accountable public service can be part of a country’s comparative advantage.
• This has certainly been Canada’s experience. Indeed, the fact of the matter is that the democratic values, the ethic of serving the public good, the professionalism, non-partisanship and commitment that characterize the Public Service of Canada underpins its role as a fundamental national institution.
• Public servants help governments shape public policy --- whether it is in the fields of science policy, competition, defence, health, the environment, trade, energy, social programs, foreign policy --- you name it, public policy and public servants influence Canadians and Canadian business.
• In this context, we need to ask ourselves what Canadians think about their public service, and why. We need to understand whether the best and brightest are considering government as a career choice and, if not, why. We need to think as public servants about how well we do our work, and what benchmarks we should set for ourselves.

(iii) Public service renewal matters:

• The challenge of public service renewal is a very real one.
• Looking ahead, the question is how do we ensure that Canada continues to have a strong public service, one geared to excellence, in the years ahead? Consider, for example:




Like the Canadian population, we are ageing, and at a faster rate in the public service. Like the Canadian workforce, the public service is becoming more diverse, but we need to better reflect the growing diversity of Canada. Like all employers, we are experiencing the changing nature of work as technology is fundamentally altering how we do things. Like everyone, we face the strongest national labour market in over 30 years, with many career options for Canada’s best and brightest. At the same time, we are uniquely facing an ongoing shift in public expectations for public service, with more accountability, better management of tax dollars and improved core public services at the top of their list. And, with all this, the “public service brand” is probably less clear and perhaps less positive in the public’s mind than in decades past.

• In this broader Canadian context, the demographics of the federal public service are ever more daunting. Fifteen years ago, federal employees in the 25 to 44 age cohort made up over 60% of the public service, with under 30% in the 45 to 64 age cohort. Today, it is largely reversed, with 50% of public servants in the 45 to 64 age cohort while just over 40% are in the 25 to 44 age cohort.
• The ageing in the public service is more prevalent in executive ranks, with the average age of Assistant Deputy Ministers now 53 years, and the average age for all executives ranges from nearly 50 years (EX-1s) to 52 years (EX-3s). Put differently, almost 10% of public servants today have at least 30 years of pensionable years of service, and 26 % of executives.
• So, while the forces of change are not unique to the public service, we need to understand them and respond to them if we are going to be successful in attracting and retaining Canada’s best and brightest to public service in the years to come.
• In tackling the challenge of labour force renewal, public service has a strong advantage --- it offers an incomparable range of fascinating and meaningful jobs, and the prospect of multiple careers, all within the same institution. Our “value proposition” is: “there are no careers like it”.
• For example, the federal public service is Canada’s largest employer, with 230,000 employees; Canada’s most national employer, with over 1,600 points of service across Canada; Canada’s most multi-skilled workforce, with more occupational disciplines than any other employer, and, Canada’s most international employer, with a presence in 115 countries around the world. This scale and scope provide unparalleled opportunities for different careers in different areas, all within the federal public service.
• To be successful, our approach to renewal has to be targeted, pragmatic, and results-oriented. We need to :




rethink our recruitment model; the Public Service of Canada cannot be a passive recruiter of talent; rethink our development model; to manage for excellence and focus on leadership; rethink the jobs-for-life and one-size-fits-all model; to encourage more interchanges with the private sector; more mid-career and end-of-first-career recruitment; and, rethink the public service brand; focus on excellence, unique careers and the opportunity to make a difference for your country.

• Let me turn for a moment to how important private sector support is to both the development of public policy and a strong public service.
• Firstly, the importance of bringing business voices into public policy development. Some in business might argue that putting in the required effort may be noble but ultimately, a waste of energy: government really won’t listen to business, and anyway, there is probably no common basis for such a dialogue. And, in true Catch 22 logic, even if we found some better way to dialogue together, how much difference would it make anyway? Everyone would probably wring their hands that this dialogue gap is a uniquely Canadian failure.
• But these are self-defeating arguments and, I strongly believe, wrong on all accounts. For example, when Canadian business has come forward with clear and well-articulated views, with demonstrated expertise on specific economic policy issues, and engaged government on a sustained basis, impressive progress has been made. As the world becomes ever more complex, this is even more essential.
• Secondly, public service renewal can benefit significantly from support from those outside government. We would benefit from more interchanges with the private sector, as well as universities and NGOs, to broaden our perspectives and help develop our next generation of leaders. We would benefit from the experience of leaders in other sectors, particularly senior business executives, in leading edge management and human resources practices and how they might be adapted and applied to the public sector.
• So, where does that all take us? Simply put: That public service matters. That the public service and its renewal matters. That business sector engagement and advice matter. That we need to think more globally, but do so rooted in our Canadian values and economic strengths. We need to be focused, to be agile and, to be relevant. And, that there is a pressing need for a greater engagement of more diverse voices, including CEOs, in sustaining a strong public service in Canada.

Conclusion

• To conclude, public service is about values, and it is about accomplishment. We must emphasize excellence, leadership and teamwork in everything we do.
• Canadians should expect nothing less than excellence in their public service, and we should accept nothing less from ourselves. The best and brightest don’t want to work for an average organization, and average public policy will not propel Canada to the front ranks of nations.
• Like my colleagues, I believe in public service, and feel strongly that all of us have a stake in ensuring that our public service is strong, vibrant and dynamic, both now and in the years to come. The Canadian public equally has a stake in this endeavour, as it is they who benefit from an excellent public service.
• And that Canadian public very much includes the business community, and Canada’s business leadership.
• A former Irish Prime Minister once famously said, when asked about the Irish economic miracle, “sure, it works in practice, but we’re not sure it works in theory!” Well, to paraphrase, good public policy and a strong public service work together in both theory and practice. We look forward to your ongoing and active support of a strong Public Service of Canada.

Thank you.