REMAKING THE PUBLIC SERVICE
After a year of COVID, the federal government has had much to learn, good and bad, from the crisis
Not since the Second World War has the federal government loomed so large over the affairs of Canadians. During the first ten months of the pandemic — from April 1, 2020 to January 31, 2021 — the government shelled out half a trillion dollars compared to $287 billion during the same period in 2019.
The vast majority of the increase was courtesy of emergency spending on an extraordinary range of antivirus measures.
About $78 billion was taken up by programs to help individuals directly affected by COVID-19. Another $66 billion went toward subsidizing wages of employees who would otherwise be laid off. Billions more were directed at shoring up the weakening balance sheets of small business, and to secure vaccines, testing equipment and personal protective gear.
At times, it seems scarcely a segment of the economy has been left untouched by Liberal government largesse, which by the end of January had pushed the federal net debt to $1.1 trillion. This represented more than half the country's gross domestic product, not a record by any means, but up from less than one-third practically overnight. This does not include the rapidly deteriorating balance sheets maintained by the provinces.
While the potential risks associated with this level of debt have been put off until the virus has been tamed, the impact of the sudden spending spree on government operations has been profound.
In the year of COVID, dozens of federal agencies and departments have been forced to behave in starkly uncharacteristic ways.
Deep-rooted policies were recrafted on the fly, procurement moved at warp speed and multiple departments were tasked with building a health products industry nearly from scratch.
On top of this, key ministries are about to be tasked with managing an ambitious program, to be outlined in the April 19 federal budget, to refurbish the country's infrastructure and help jump-start the post-COVID economy.
Behind the scenes, government executives are ramping up plans for modernizing operations. They are also asking themselves what permanent lessons they should draw from the tumult of 2020.
These range from the profound: How to prepare for a new pandemic, to the practical: How should government better organize itself for the digital world?
The first lesson involves drilling into the overarching weakness of Canada's response to the coronavirus — not just the egregious intelligence failure of the Public Health Agency of Canada, but also the relaxed oversight of a cabinet that could not bring itself to accept a worst-case scenario.
PHAC had assured Canadians the health risk to them was low early last year even as the coronavirus was circulating widely.
At heart, this was a failure of leadership culture, not a lack of early warning. The infection that became known as COVID-19 was in plain sight from the start. What PHAC missed, or at least declined to act upon, was the fact that COVID-19 was spreading asymptomatically, despite evidence that had been brought to its attention.
The result was a sharp, early rise in the number of infections, followed by a sub-par rollout of COVID -19 vaccines, which reflected a general lack of preparedness.
For other departments and agencies, the lessons of COVID are more straightforward.
The rapid spread of the coronavirus has demonstrated clearly the importance of the digital world. While the federal government has built one of the country's largest communications networks, much of it is in need of refreshing and very little is easy to use.
The technology gaps were particularly shocking when it came to tracking stockpiles of personal protective equipment, conducting tests for the coronavirus and tracking the networks of people affected. This was both a provincial and federal government failure.
Anxious to avoid a repeat, federal departments in the past few weeks have developed ambitious plans for upgrading their infrastructure, and expediting new online services for Canadians. Whether these actually succeed will depend heavily on the government's willingness to reverse its traditional antipathy for investing in operations. Encouraging executives to bear direct responsibility for projects will help.
“The path set out during the early days of the pandemic points to a new way of doing business,” the Canada Revenue Agency declared in its priorities report for the fiscal year ending March 31, 2022.
The agency, which spends half a billion dollars annually on information technology and was a key player in the delivery of the Canadian Emergency Response Benefit, is making permanent adjustments to its networks to give it more flexibility in the event of future crises. It is also developing a series of software applications to simplify tax returns, permit more tax verification information to go online and automate more of the tax filing process.
Employment and Social Development Canada is managing a massive, multi-billion dollar upgrade of the systems that deliver Canada Pension Plan, Old Age Security and other payments. While that was in train before the pandemic, the urgency has increased.
“Past decisions to defer maintenance and updates have increased the risk of systems failure,” the department noted bluntly in its most recent plan, “Modern applications need up-to-date technology.”
Past decisions to defer maintenance and updates have increased the risk of systems failure. Modern applications need up-to-date technology.
During the first few days of the economic lockdown a year ago, ESDC's system for delivering employment insurance claims very nearly crashed. The department now has in place a program for accelerating its investments in information technology until 2026 to try to make up the gap in its capacity.
ESDC is hardly alone in playing catch-up.
Federal departments across government currently maintain some 14,000 software applications, ranging from weather forecasting to applications for business loans. Many are built on technology so old the original providers have simply stopped supporting it. In order to keep the entire apparatus humming, the government relies on thousands of software jocks familiar with products now past their prime. Many are employed by private sector specialist firms.
“We have to deal with the legacy stuff we inherited, fix it, replace it, modernize it,” Shared Services president Paul Glover acknowledged last fall before a House of Commons committee.
One way to look at it: Older software programs need to be upgraded or replaced before they can be shifted from legacy locations to one of the pristine data centres now up and running. To date, just five per cent of the workloads associated with the software have migrated from old data centres to new ones, with another 40 per cent in various stages of planning.
What's needed, in other words, is a concerted effort to modernize government faster than it's aging. Departments and agencies will have to stretch.
Thanks to the experience of COVID-19 they now understood just how quickly they can move. Some of the more inspiring examples include:
Canada Revenue Agency and ESDC developed generous financial assistance programs for millions of Canadians in a matter of days. Shared Services Canada boosted by 50 per cent the capacity of its networks serving Canadians online, and doubled to nearly 300,000 the number of secure connections used by government employees working from home. Global Affairs seconded more than 600 employees to an emergency response centre at Lester B. Pearson headquarters. There they organized the repatriation of more than 60,000 Canadians from 100 plus countries in the largest post- Second World War exercise of its kind. Public Services and Procurement Canada — the government's contracting arm — arranged for the flights for repatriated nationals, and negotiated billions of dollars' worth of medical supplies, testing equipment and other gear on behalf of the Public Health Agency of Canada. PSPC managed all this with a three per cent bump in the size of its procurement group.
So it was, across government. While Canadians in other parts of the country were suspicious that thousands of federal employees had simply booked time off for a COVID holiday, things actually got done.
Yes it was messy. Mistakes were inevitable in this environment, the prime minister acknowledged, but these would be corrected later, he promised. Indeed Canada Revenue Agency and ESDC are conducting audits of the billions of dollars of emergency payments, an exercise that will rely to some extent on artificial intelligence software.
Dealing quickly with the vast knock-on effects of COVID -19 was considered more important last year than upfront due diligence — an assessment with which Auditor General Karen Hogan agreed.
In some ways the government was lucky. Had COVID-19 struck a few years earlier, the response might have been an unholy mess. As recently as 2018, Shared Services Canada, the core supplier of data centres, internet service and telephone networks, was working itself out of a deep hole created when Stephen Harper's Conservatives cut its budget just as the department was launched.
The government only recently put in place a cloud services program with third parties, allowing departments to quickly expand network capacity in emergencies. It's what saved the CERB program.
Just as fortunate, federal departments have been experimenting with pilot projects — such as work-from-home arrangements and automatic bank deposits — that allowed near instant responses to COVID developments.
These signs of flexibility and speed were the fruit of an extraordinary exercise in workplace consultation.
In June 2013, Wayne Wouters, the government's top mandarin and clerk of the Privy Council, asked federal workers what they thought of Blueprint 2020 — an analysis of global trends in technology and management. The document set out a series of principles that would govern how employees would do their jobs in light of these new realities.
The gist was that in order to properly serve Canadians by 2020, government workers would be equipped with state-of-the-art technology, and encouraged to be flexible, to experiment with ideas, and collaborate with other departments. They would also be given freedom to make mistakes and to learn from them.
More than 100,000 offered their views, most of them keen on the idea of making a difference. Others viewed the exercise with skepticism. They knew that as long as politicians felt they had to answer for errors in their departments, the business of running government would default to avoiding risk. Top-down management would prevail. In many ways, it still does.
Yet, fitfully, and somewhat improbably, the work culture began to shift. Here and there, departments and agencies set up those pilot projects. Government planners lost their enthusiasm for huge, all-encompassing programs following the botched rollouts of Phoenix Pay and email systems for federal employees. Both of these had been launched prior to the publication of Blueprint 2020.
We have to deal with the legacy stuff we inherited, fix it, replace it, modernize it.
Instead, the government has encouraged minimalism — the idea that new online services for Canadians or government employees should be developed in more manageable stages, with each one tested before moving to the next.
When responding to COVID, of course, there was little time for testing. But even there, the lessons of Phoenix Pay had been absorbed. In developing the Canadian Emergency Response Benefit for millions of people affected by the virus, the Canada Revenue Agency aimed for what it called a “minimum viable product” — a software application stripped to absolute essentials.
Along with making changes to the government's electronic backbone, departments are wrestling with how to deploy their workers, post-COVID.
The Canada Revenue Agency — with 45,000 employees, including some 12,000 in the capital region — is also taking the lead on creating a permanently distributed workforce. In response to queries by the Citizen, the agency said it is looking to shift toward “a hybrid model” that will see a certain core work full-time from the office, while giving other employees the flexibility to work from home.
Other departments, such as Public Services and Procurement Canada, are moving more deliberately. PSPC says it has launched a oneyear pilot program “to study and document how to advance future ways of working.”
The collective decisions will have a profound effect locally. Not only do federal government employees make up more than 20 per cent of the Ottawa region's total workforce, they work in buildings that account for nearly 30 per cent of the capital's commercial real estate.
Managers and workers alike have learned much of their work can be done from anywhere, leading some to query why 42 per cent of the government's 300,000 civilian employees need to be based in the national capital region. Departments with more than 80 per cent of their workforce located in Ottawa or Gatineau include: Finance, Statistics Canada, Treasury Board, Innovation and Global Affairs.
Real estate planners suggest the government's future workforce will likely be split into three groups: Small minorities who choose to work permanently from home or the office, and a majority who will work remotely for part of the week.
With thousands of work rules at play across dozens of union bargaining units, none of this will be easy to sort out.
“The work office will have to be rethought,” says Stéphane Aubry, national vice-president of the Professional Institute of the Public Service of Canada, which represents 60,000 government workers. “Some of our members will prefer to keep working at home,” he adds. “We will not be going back to what was before.”
Before the pandemic struck, the government had been nearing the end of a multi-year program to reduce the amount of office space available for each employee.
Almost certainly this strategy will be reversed to accommodate workers still concerned about working in proximity with colleagues. This means fewer workers for the same amount of office space.
This won't necessarily be a problem, at least in terms of logistics, assuming sufficient numbers of employees work from home. But it will likely increase overhead costs for government workers overall.
In coming years, as the government starts winding down its spending, the nearly $50 billion it spends annually on payroll for permanent staff will likely come under increasing scrutiny, not to mention the $11 billion it spends each year on professional services.
A strong counter-argument would be to point to a sprawling organization that, prompted by COVID, learned to serve Canadians with dispatch and efficiency. Will it actually happen?
Put it this way: The federal government over the past decade wasted billions of dollars of taxpayers' money on failed information technology projects — and both government and private firms were at fault.
Departments now have another opportunity to get things right and rehabilitate their reputations. Many of the pieces are in place but the big unknown is whether the flexible culture foreseen by Blueprint 2020 will actually be permitted to flourish.