II

1991 IN REVIEW

The renewal of the Public Service will not be achieved simply through legislative and administrative action ... It requires fundamental changes in attitudes by Public Servants, by Ministers, by Parliamentarians and ultimately by the public. ³

1991: Key Events and Milestones

1991 was a year in which measures to further the goal of fiscal restraint had a direct impact on the Public Service. The events of the past year show that the path of renewal is not an easy one.

The 1991 Budget

The 1991 Budget was aimed in part at further reducing the costs of government. This was necessary not only to keep the Government's fiscal house in order and maintain progress on reducing the deficit, but also to demonstrate to Canadians that the federal government was prepared to set an example of restraint in its own operations and notably in its own wage levels.

Wage Restraint

It was announced after the Budget that there would be no increase in public service wages and salaries - for both unionized and non-unionized personnel - for 1991-92 and an increase of up to three percent in 1992-93 and 1993-94. The salaries of Deputy Ministers and other Governor in Council appointees were also frozen. Later it was announced that performance pay for executives was suspended for one year. The loss of performance pay meant an average reduction of five percent in take-home pay for Deputies and executives.

Ten Percent Reduction in the Executive Group

At the same time, the decision was taken to reduce by 10 percent the number of executive personnel in the government - the roughly 4,750 most senior public servants below the level of Deputy Minister. This means that by 31  March 1993 there will be at least 475 fewer executives working in the Public Service. As of 31 March 1992 there had been a reduction of 362 executives.

A government-wide program of "de-layering" in departments was also introduced. This has resulted in the elimination, in all but a very few cases, of any more than three layers of executive management below the Deputy rank in any department of government.

The 1991 Strike

Public service wage restraint was strongly criticized by the heads of the public service unions. They pointed out that federal wage settlements since 1985 had been consistently below those in the private sector or in provincial public services. They noted that, contrary to the image of the Public Service as over-paid and under-worked, the average salary of their members was much less than commonly believed.  ⁴

Despite efforts on both sides to avoid a damaging work stoppage, in September of 1991 the Public Service went through its first national strike in over 10 years when members of the Public Service Alliance of Canada, the largest public service union, went on a legal strike in an effort to get the Government to change its position on wages.

The strike was a significant event, both for those on the picket lines and for those who were trying to maintain programs and services in the meantime. Canadians who were denied access to government services during the strike were reminded of the extent to which they depend on those services in normal times.

The strike created real tension not only on the picket line, but also in the workplace after strikers returned to work. Public Service managers and employees faced the challenge of rebuilding an
atmosphere of trust and teamwork among colleagues who may have been on different sides of an obviously emotional issue.

Al-Mashat

The Al-Mashat affair also captured public attention in 1991. It was a difficult experience for all concerned, and one from which no individual or institution emerged unscathed. The affair caused many people, both inside and outside government, to think carefully about the doctrine governing the accountability of Ministers and officials. The principles are clear-Ministers are responsible to the House of Commons for what is done in and by the Government; officials are responsible, for what they do, to their superiors and ultimately to Ministers. Annex III of the Report on Progress sets out the principles and their practical application very clearly. I want to draw them to the attention of all public servants in order that they may have no doubt as to where they stand in relation to the responsibility of their Ministers and their own accountability.

Priorities and Objectives for the Past Year

In May 1991, I set out five priorities for Deputy Ministers for that year in relation to public service renewal. Those priorities were:

• introducing service standards and client surveys as ways to improve service and to build a continuing dialogue with clients;

• reducing the number of levels of management in departments to improve efficiency and flexibility;

• increased delegation of authority, especially to the regions - again, to improve front-line service;

• improved career planning, especially with respect to women;

• fostering the work of "councils for change" in departments, as mechanisms to ensure continuing progress in reform and renewal.

The companion document, Public Service 2000: A Report on Progress, reviews in detail what has been achieved in these areas over the past 18 months.

Progress in the Five Priority Areas

In some areas, such as  reducing the number of levels of management, progress has been clear. As noted above, with very few exceptions, there are now no more than three levels of executive management below the Deputy Minister level. In other areas such as service standards, the pace of change has been slower but is now accelerating as departments realize the benefits to be gained by developing standards in consultation with their clients.

There has also been substantial progress with respect to delegation of authority. Delegation to departments from central agencies has generally increased, in some cases quite substantially (though not always to the degree desired by departmental management). Delegation within departments varies, as it should. Departmental circumstances are not the same, and the capacity of managers at different levels in different departments to exercise delegated authorities properly varies depending on their experience, training and program size. This is an area where I look for continued progress over the coming year.

The term "councils for change" refers to departmental fora that bring together a representative group of employees to foster innovation and renewal, particularly on "people issues." Virtually wherever they have been tried they have been useful in helping to launch and reinforce the process of change in departments. I would expect them to become a continuing feature of good management in government.

The area where the record is most ambivalent is that of career development. On the one hand, there have been many positive things done in departments and agencies to improve training and development, to foster mobility and to make better use of people. These initiatives are described in the chapters of the accompanying Report on Progress. Many of these new programs have already had a positive impact on the jobs and careers of employees; they are not just plans or statements of good intention.

At the same time, the scope of these initiatives has been limited. This is particularly true in areas such as employment equity and career development for those in support staff positions. I am not satisfied that we are yet making the fullest use of the immense reservoir of talent available in the Public Service. I am not yet able to report "full speed ahead" on the acquisition of new skills by our employees. This area - career development - remains an important challenge for the coming year and will remain so in the years ahead.

Overall Assessment of Progress

Shortly after the launch of the initiative, I remarked that Public Service 2000 is "10% legislative change, 20% change in systems, and 70% change in attitudes and practices within departments and agencies."  ⁵

The overall objective of these changes is better service to Canadians and to their Government. The following sections assess progress in those terms.

Improvements in Service

Bottom-line improvements in service are the real touchstone of our success in Public Service 2000.

Service improvements are driven by individual Ministers and their departments, and often by individual work units and employees. They are not a matter of direction or control from outside the department, though central agencies can facilitate service improvements by cutting red tape, delegating more authority and generally fostering innovation.

Public Service 2000: A Report on Progress  lists many examples of specific improvements that have been made in departments such as Revenue Canada Taxation or Fisheries and Oceans. These changes involve quantifiable improvements in responsiveness to clients that would be the envy of any large organization in the private sector.

Many of these improvements in service are noticeable to Canadians, as virtually anyone who has had recent dealings with their local income tax office would attest. Forms are simpler, service is faster, technological innovation is obvious. Similar kinds of improvements - whether in turnaround time for passport applications or access to electronic bulletin boards for suppliers - can be found in every department and agency. These improvements have been delivered despite an actual decrease in available resources.

But Canadians are aware that their hard-earned tax dollar does not seem to return as much in programs and services as it did in years gone by. They are right. In 1984, Canadians were receiving $1.33 in programs and services for every dollar they paid in taxes; the remainder was borrowed. Today, as the Government continues its program of fiscal restraint, Canadians are still paying their tax dollar, but a growing share is being used to pay interest on the debt. What this means for the Public Service is that we cannot buy our way to better service. We have to get there through innovation and by removing bureaucratic obstacles to efficiency. That is what we are doing in   Public Service 2000.

A Commitment to Consultation

We are taking important steps toward greater consultation with Canadians in the development of policies and the delivery of programs. It takes time to change people's attitudes, and we still have a long way to go before we reach the level and quality of consultation which Canadians and their Governments expect. Nevertheless, we are making progress.

Under the guidance of Ministers, more and more departments are working in close cooperation with their clients in changing programs, or developing new ones.

For example, Employment and Immigration's National Labour Force Development Board, with its several regional offshoots, was created as a way to give employers and labour a major stake in decisions on the allocation of training funds. It represents a significant change in how the government does business.

Other examples include the extensive consultations undertaken by Revenue Canada, Customs and Excise before implementing the GST, and by Statistics Canada in the preparations for the 1991 census.

The general point is that the Public Service is serving the Government and Canadians with a new sense of commitment to the views of clients. The result should be better policies and programs, and better understanding among Canadians about their government.

A Change in Organizational Culture

Through Public Service 2000, we are trying to create an environment in which public servants can be more responsive and more innovative by giving them a real stake in the services they provide to Canadians.

Change is happening, often in ways that are difficult to quantify but nevertheless real. More and more government organizations, for example, are involving employees in the definition of departmental objectives and levels of service; more and more are adopting mechanisms for upward feedback and other means of improved internal communication. All departments are coming to realize that successful decentralization depends on trust in employees to provide better service.

In many places, we are seeing the first signs of a real transformation in management culture. The old "command and control" model is not dead yet, but it is rapidly being replaced by a new kind of institutional culture in which people are valued and decisions are taken with much greater input from those who have to implement them.

The Deputy Minister Community

Deputy Ministers serve Ministers directly; they are responsible, at the officials' level, for the leadership of institutions with multi-billion dollar budgets and tens of thousands of employees; they exercise legal management authorities bestowed upon them by the Treasury Board and the Public Service Commission; they deal on a daily basis with client groups of all sorts. By exemplifying the values of Public Service 2000, Deputy Ministers can demonstrate to all their employees that the process of reform and renewal is alive in their departments. For all these reasons, they play a key role in the broader process of public service renewal.

Better communication at senior levels has been one of my personal priorities - through weekly breakfast meetings with all departmental deputies, annual retreats, twice-yearly sessions with the community of Assistant Deputy Ministers and a variety of other mechanisms. Effective leadership is based on good communications and a collegial approach to work. That is one of the principles underlying Public Service 2000.

Since my appointment as Clerk I have given particular attention to the management of the community of Deputy Ministers. This group of 50 includes approximately 30 departmental deputies and another 20 or so persons serving as Associate Deputy Ministers or carrying out other senior functions. One of the key objectives of Public Service 2000 has been to ensure that the men and women at this most senior level of the Public Service have the leadership, communications and management skills to lead the institutions of government successfully in the years ahead.

I am particularly pleased with the progress we have made in recent years with respect to the representation of women in the Deputy Minister community. At present, 10 of 50 Deputy Ministers, or 20 percent, are women. This is a higher percentage than in the Executive Group as a whole, and nearly twice the representation that existed in 1984. I am committed to similar progress with respect to members of the other employment equity designated groups.

The representation of Francophones in the Deputy Minister community remained much the same between 1984 and 1991 at about 30 percent.

Another of my priorities in relation to Deputy Ministers has been to increase the time they spend in their positions. In 1986, Deputies had been in their jobs for an average of 18 months; by 1991, average time in position had increased to 29 months, and about 40 percent of Deputies had been in their jobs for three years or more. This steady increase has allowed Deputies more time to learn about their departments and thus better manage the entire range of departmental activities. It has also enabled Ministers and Deputy Ministers to get to know each other well and to work together effectively as a team.

A successful reform exercise must be top-down as well as bottom-up. By paying more attention to the management of the Deputy Minister community, and by holding Deputy Ministers more clearly accountable for how well they manage people and organizations, we are sending a strong signal to the entire Public Service that reform is a continuing priority.

Legislation

On 18 June 1991 the Government introduced Bill C-26, the Public Service Reform Bill. This omnibus legislation incorporates changes to the Public Service Employment Act, the Public Service Staff Relations Act  and the Crown Assets Disposal Act that are together intended to give statutory effect to the goals and values of Public Service 2000. The Bill was developed through a long process of consultation with employees and with public service unions.

The passage of the Public Service Reform Bill  will create the statutory framework necessary for a modern personnel management regime in the Public Service. It will permit changes in classification to increase mobility and opportunity for employees. It will allow for the more rapid deployment of employees from one job to another at the same level, with their consent. It will provide the necessary legal foundation for the establishment of employment equity programs. It will simplify collective bargaining and permit better and more constructive conflict resolution. It will streamline provisions relating to termination and demotion.

It would take too long to enumerate all of the changes that the Public Service Reform Bill  will bring to the Public Service. The key point is that this legislation will have a significant and positive impact on the way in which the Public Service will operate in the years to come.

Systems

Here again, we have passed some important milestones, including:

• the introduction of Operating Budgets, which will give departments and agencies much greater flexibility in allocating resources to meet changing program needs;

• the creation of Special Operating Agencies,  a new organizational form that brings a business-like bottom line to the operation of business-like functions in government;

• the creation of the Executive Group  with fewer pay bands;

• the systematic delegation of greater levels of authority  from the centre to departments, and within departments out to the regions, in personnel, finance and administration;

• making common services optional  in areas such as architecture, engineering and tenant services;

• the establishment of  "councils for change"  as departmental fora where employees at all levels can be involved in shaping improvements in people management;

• the development of mission statements  to articulate a clear, shared raison d'être and bring about a client-centred culture in departments.

One critical area where progress will be essential in the coming year is classification. Of all the system-wide reforms undertaken since the White Paper, classification is one of the most important. A simpler classification structure will provide greater flexibility within organizations; it will improve mobility and opportunities for career advancement.

Consensus on the Need for Reform

For many thousands of public servants,  Public Service 2000 has become a reference point on which they can base changes they want to make in their workplace. The goals and values of Public Service 2000 are cited not just by managers seeking new efficiencies or greater productivity, but by employees at all levels. They have perhaps the biggest stake in the quality of their working environment and the quality of services delivered to Canadians.

Obviously, not all public servants or public service unions would endorse the changes that have been made so far, or those that are now being proposed to Parliament. Given the events of the past year, and the fact that change is inevitably disruptive and often threatening, universal approval would be too much to expect.

But even the critics would not deny the need for change and renewal inside the Public Service. And the many points of agreement on all sides over such things as the need for classification reform, the need to cut red tape, the need to focus on service, the need to invest in training, the importance of good communication - these prove more eloquently than any statement of policy or any survey of employees, that public service reform is not an option, but a necessity.
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