Jones: Politicians are right about the ‘decline of the west’ – but so wrong about the causes

2023/04/13 Leave a comment

Pessimistic view but not without merit. But social shifts have also been important, with considerable progress in terms of diversity:

If there is such a thing as an onward march of human progress,it has not just halted, but screeched into reverse. Last autumn, a little-discussed report issued by the United Nations noted that human development had declined in 90% of countries for two years in a row, a fall without precedent for more than three decades. The pandemic and Russia’s invasion of Ukraine played their role, but so too did “sweeping social and economic shifts, dangerous planetary changes, and massive increases in political and social polarisation”.

You may well be familiar with chatter about “the decline of the west”: it has tended to be the preserve of the reactionary right, who blame, variously, moral decay, multiculturalism and a reassessment of European history for our downfall. But it is not minority rights, diversity or acknowledgment of western crimes to blame. The turnaround in our collective fortunes has been dramatic. But it is driven by an economic system that promised personal freedom but instead delivered insecurity on a mass scale, and which has has hurt us in every conceivable way, from our emotional and physical wellbeing to our material circumstances.

Take one basic measure: life and death. The UK government has been forced to delay lifting the state pension age after a fall in life expectancy without precedent since the war. Although certainly worsened by the pandemic, life expectancy was already declining in many English communities years before Covid arrived on our shores. In the US, life expectancy declined from nearly 79 in 2019 to 76 two years later, the biggest fall for a century.

And the morbid symptoms of a crisis in wellbeing are everywhere. Across the Atlantic, the suicide rate soared by 30% in the first 20 years of the 21st century. As the “war on drugs” has escalated, so have deaths from substance abuse: in the US, they have grown exponentially since the 1970s, helping to drive the fall in life expectancy, while in the UK they have reached their highest level since records began. Karl Marx once described religion as the “sigh of the oppressed creature”: today this is more of an apt description of drug addiction, driven by the self-medication of those afflicted by trauma and misery. Indeed, it is difficult to disentangle from a global leap in depression, which increased by almost a fifth between 2005 and 2015, and has also surged among US teenagers.

Peering at the rubble left by humanity’s bloodiest war the best part of a century ago, a western European citizen in 1945 would have been pleasantly surprised to discover that the most prosperous years in history awaited them. Such was the unprecedented rise in living standards in the west in the three decades after the war that it became christened the “Golden Age”; for the French it was the “30 glorious years”. But while the UK suffered a particularly pronounced fall in wages in the 2010s, they have stagnated across the western world. Before the pandemic hit, the purchasing power of US workers had barely shifted for four decades.

It’s easy to be lulled into the illusion that dramatic progress is still happening. Computer chips get ever-smaller; computer processors ever-faster; mobile phones ever-more dynamic. But technological advancement does not automatically translate into improvements in the human condition. Across much of the west, stagnation and decline has become the defining feature of our age. If you want to understand why politics became angrier and more polarised, don’t look for facile explanations such as argumentative behaviour fostered by social media. A grand experiment has been under way for more than a generation: what if you cut off optimism from rich societies that previously took ever-rising living standards for granted?

UK renters can’t afford their mouldy, exorbitant homes – now they can’t afford to complain either

The rise of the “free market”, we were promised, would unleash endless prosperity. But while the much-demonised age of strong trade unions, nationalisation and expansive welfare states delivered the greatest improvement in living standards in history, our current economic model is decomposing all around us: the stench is becoming harder to ignore. On both sides of the Atlantic, economic growth has fallen since the frontiers of the state were rolled back, and that more limited growth is more likely to be sucked into the bank accounts of the gilded rich.

How does that explain, say, falling life expectancy driven by rising opiate use in the US? We know that the disappearance of secure, well-paid jobs has bred the conditions of misery in which addiction thrives. Growing inequality has helped spur on deteriorating mental health: rates of depression correlate with low income, for example. From the generational collapse in public housebuilding to the decimation of social care, the security that underpins a comfortable human existence has been peeled away.

And yet how little this halt in human progress is mentioned, let alone debated. With our civilisation facing multiplying existential challenges, how quickly stagnation and decline could become a freefall. You don’t need an overactive imagination to ponder the brutal possible consequences, especially if progressive politicians fail to offer compelling answers. Our lives are shortening, our wellbeing is falling, our security being dismantled. These are the conditions of despair, and a bitter harvest beckons.

  • Owen Jones is a Guardian columnist

Source: Politicians are right about the ‘decline of the west’ – but so wrong about the causes

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Internal documents reveal how much consultants shaped the National Gallery

2023/04/10 Leave a comment

While most of the attention has been on McKinsey, reminder that other organizations are involved.

Given all the management and staff upheavals, hard to see the value for money in these consulting contracts. One also has the impression that Sasha Suda, the director who launched them, was “just visiting” until she got a more important gig in the USA, leaving the mess behind:

Consulting companies had profound influence on the National Gallery of Canada’s reimagining over the past few years, with senior management relying on hired guns to help craft the new identity of the country’s premier visual arts institution, documents released through access-to-information requests reveal.

The documents paint a picture of the extent to which two consulting companies – one headquartered in Vancouver and focused on diversity and inclusion, the other a California-based change management firm – shaped the gallery’s new focus, operations and culture.

The contracts began in the spring of 2020, shortly after Sasha Suda became director of the gallery (she left last summer to run the Philadelphia Museum of Art). Under Ms. Suda’s leadership, and under current interim director Angela Cassie, the gallery embarked on a reinvention intended to make the institution, its collection and its staff more diverse and inclusive.

Management viewed this as an overdue step toward restoring the gallery’s relevance and correcting its blinkered past. Current and former staff members and donors have criticized the project as well-intentioned but poorly executed, and they have said it left the institution in disarray.

In May, 2020, the gallery signed a contract with NOBL Collective, a change management consultancy based in California, for strategic planning work, at an initial cost of $95,000. As the scope of its work expanded, NOBL would eventually bill the gallery $632,500 over two-and-a-half years, making it the single biggest line item among the museum’s outside contractors during that time.

The documents, which were obtained by researcher Ken Rubin and shared with The Globe and Mail, include an initial proposal in which NOBL wrote that the gallery was “in the midst of a sea change” that represented “a moment of uncertainty but also of rebirth.”

“You have many of the right ingredients: a dedicated team, hungry for direction and empowerment; a rich history and story; a world-class collection; a new Director willing to do what it takes,” NOBL wrote. “We would be honoured to help your team make it happen.”

The documents detail a program of one-on-one interviews with senior management and other team members, as well as surveys and strategic planning sessions focused on topics such as “Sensing, Vision and Bet Making.”

Eventually, the scope of NOBL’s work became all-encompassing. The consultancy laid out plans and timelines for defining the museum’s values and crafting its “change narrative.” It said it would create working groups and synthesize for the gallery what it heard from them; communicate with the board of trustees, department heads and team leads; align blue-sky strategic ideas with budgets and staffing; even design and help to deliver the all-staff meetings in which the new vision would be shared.

The result was a strategic plan titled Transform Together. Unveiled in 2021, it is the spine on which the museum’s new direction rests.

“The Gallery’s strategic transformation is about how we can better develop, preserve and present our collection for the learning and enjoyment of generations to come,” said Douglas Chow, the gallery’s director of communications. NOBL “did not have the expertise required” to incorporate a justice, equity, diversity and inclusion (JEDI) approach, so NOBL recommended Elevate Inclusion Strategies as a subcontractor to its own work, he said, and the two jointly helped to craft the strategic plan.

Getting some specialized help with strategic development is fine, said Richard Powers, who teaches governance at the University of Toronto’s Rotman School of Management, but it should always be an institution’s own management that does the heavy lifting.

“It appears that management has handed off all the work to the consultants: tell us what we should do,” he said of the gallery. “Any consultant will never know as much as management – that is why management must be intimately involved in the development of the strategic plan.”

In August, 2020, Ms. Suda wrote a confidential memo explaining the gallery’s reasons for embarking on this work, and why it required sole-sourced contracts rather than the usual competitive bid process. When the pandemic struck, the gallery was forced to close and most employees shifted to working remotely, she wrote, and at the same time the gallery was affected by “various social movements that catapulted the necessity of diversity and inclusion review and reconciliation with BIPOC groups.”

The unusual pandemic circumstances and the “extremely sensitive nature of the subject matter” justified an exception to the standard procurement processes, Ms. Suda concluded. The following month, she wrote a virtually identical memo laying out the need to sole-source work from Elevate, which is based in Vancouver.

One year later, in September, 2021, Ms. Cassie – then vice-president of strategic transformation and inclusion at the gallery – wrote a more detailed confidential memo explaining the reasoning for an additional sole-sourced contract with Elevate.

Elevate had conducted an assessment of the gallery’s inclusion environment, and “significant differences in the level of knowledge and understanding amongst the team” became apparent, Ms. Cassie wrote. Among the key recommendations from Elevate was that the gallery remedy this. Because Elevate staff had already built a relationship with gallery employees, Ms. Cassie wrote, the company was “well positioned to create a safe and positive environment” for the ongoing work.

Mr. Powers said this process – with Elevate conducting an assessment of the gallery, then producing a report that effectively recommended further services provided by Elevate – appears odd.

“They are in a clear conflict of interest and the National Gallery should have gone to a competitive bid to avoid the conflict or the perception of a conflict,” he said. “Elevate may be the best company to do this type of work – and a competitive bid could have come to that conclusion.”

Asked for additional context on the sole-sourced contracts, Mr. Chow replied with sections of the internal memos on that topic. He added that the board was aware of the contracts. “The Elevate team had built that trust using a trauma informed approach and had the knowledge and expertise to carry on the next phases of work without requiring employees to retell stories of their trauma and racism experienced within the workplace to new people,” he said.

The gallery subsequently signed a contract with Elevate for $352,200. That fee included a retainer of $10,000 per month from September to February, 2022, for services including the development of a “JEDI working group,” meeting with gallery leadership or other consultants as needed, attending staff meetings and assisting with the onboarding of new staff. The hourly cost and hours of work covered by the retainer are redacted in the documents, because access-to-information laws permit public bodies to withhold those details about their private contractors.

Elevate’s contract also included a coaching program described as “a deep dive for senior leadership and management who wish to develop and practice critical inclusive leadership skills,” and the development and delivery of a suite of inclusive workplace training modules.

In June, 2021, the gallery again turned to NOBL, this time for a more targeted project that hinted at tensions behind the scenes. There had been near-total turnover among the gallery’s senior leadership since Ms. Suda’s arrival.

In its proposal, NOBL wrote that the gallery had evolved a great deal over the previous year, and now, with its new team members in place, it was time to focus on “engaging in productive, courageous conversations.”

“While conflict is a necessary part of our day to day existence on a team, both emotions and assumptions take the lead when we’re not paying attention,” NOBL wrote. “You’d like the team to improve their ability to separate the people from the problem and create space for learning for all involved.”

To that end, NOBL would design and deliver a four-hour team-building workshop for the seven members of the gallery’s senior management committee, at a cost of $15,000. The topics included conflict style, giving and receiving feedback and empathy perspective.

“Even though the session will be half a day, we’d request that SMC members clear their full day calendars to allow time to process conversations and bring their full presence to the session,” NOBL wrote to the gallery. “Development experiences should feel like an opportunity to slow down and set yourself up for success.”

Source: Internal documents reveal how much consultants shaped the National Gallery

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Hicks: The radical improvement of data will transform public sector reform

2023/04/03 Leave a comment

The comparatively easier issue is developing and accessing more reliable and granular data (evidence-based policy development). The harder issue is the extent to which whether governments will use the data to inform policies and programs, compared to political and short-term considerations (policy-based evidence development).

I am less optimistic than Hicks:

Recent Policy Options articles have reflected on the need for public sector reform to deal with “wicked problems” related to decentralization, outsourcing, lack of public trust, lack of openness and the politicization of policy advice. Donald Savoieargues that the public service, with its obsolete policies and processes, has come so irreparably off its moorings that only an independent royal commission can fix it. Others, including Daniel Caron, Evert Lindquist and Robert Shepherd, call for internal reform processes.

An obvious question is why experiences over the past 50 or so years with both royal commissions and internal reforms have had such poor results. One factor has been the lack of the kind of reliable, granular evidence that would be needed to assess and learn from past initiatives that would also be needed to ensure that new directions can be managed in a transparent, accountable manner. As Caron, Lindquist and Shepherd say, institutional learning must be based on ongoing evidence and much of that needed evidence has, until now, not existed.

However, that is changing. As I demonstrate in a recent article, a radical improvement in evidence has become possible as a result of the availability of rich sources of new information, new ways of combining data from multiple sources in ways that protect privacy and the development of new predictive analytic tools based on big data. Much of this new evidence will be based on calculations using detailed administrative files. Ground-breaking information from other sources are on the horizon. For example, the use of data from personal monitoring devices from volunteers (with guaranteed anonymity) will be possible in the near future.

Another factor contributing to the failure of past reforms has been a tendency to examine the way in which services are administered separately from the actual content of those services. Many issues of public trust, morale, transparency, efficiency and service quality can only be addressed though deep changes in outdated policies and programs. They cannot be addressed by changes in the way programs are administered by the public service.

A third factor is that most reforms have taken place within existing programming and jurisdictional silos. This has made things worse by reinforcing overly fragmented programming, especially in the social policy area. Social policy in Canada is too often characterized by confusing sets of income supports and tax measures administered by both orders of government as well as overlapping but uncoordinated services provided by health care, educational and community organizations.

If the goal is to help people improve the quality of their lives and to increase trust between individuals and their governments, reforms need to be based on accountable partnerships that provide integrated services and supports based on an individual’s needs and aspirations. In practice, that hasn’t happened, largely because there’s been no source of routine evidence about which mixes of intervention are likely to work best for people with diverse characteristics in different circumstances.

However, that could change soon. Formerly wicked problems will be much easier to solve. Progress will soon make it possible to produce the kind of evidence that will allow us to learn from past experience and will support the accountability regimes needed to sustain reform efforts. That same evidence will also support major reform in the way policies are formulated, and the way in which programs are designed and delivered.

The new evidence will allow powerful new kinds of causal analysis. For example, it will become possible to make comparisons of the previous and subsequent characteristics and experiences of the participants in particular programs with those of non-participants with similar characteristics and in similar situations. This information would allow analysis of which programs (and combinations of programs) are working best, for whom and in what circumstances.

Using predictive analytic techniques, information on “what is likely to work best” will be available instantly – at the time when decisions are being made on choices of interventions. It will allow programs to continually improve and evolve based on automatic feedback loops showing what has been working best for people, including those who now feel alienated by standard, often fragmented programs that do not reflect their individual circumstances.

Over time, the new information is likely to reshape the way in which people are matched with programs. It would support the growth of an independent case management function where individuals with the greatest needs are referred to the service most likely to be effective (or, often, a combination of services and income supports) by counsellors who have access to evidence on what is likely to work best, regardless of who offers the service. The same information would allow other individuals, acting on their own, to learn what services exist and which are likely to work best for them given their needs and interests.

Development has reached a point where Statistics Canada is considering plans to use these new techniques to radically improve its social statistics. It is the only agency with the mandate and technical capacity to ensure the privacy and confidentiality of the source data and to ensure the quality of the resulting statistics.

The next logical step would be for it to gradually and cautiously enter into partnership arrangements with agencies in different jurisdictions and in different policy domains. Those agencies who wish to be early reformers can experiment with ways of using the anonymous “what works” evidence using the big data that is securely held within Statistics Canada.

It will take time to develop a fully mature system based on the new analytics. Progress will be slow and uneven across different policy domains. Issues related to public acceptability will be paramount. However, much of the needed background development work has already taken place. If the demand is there, significant progress is possible in many areas within five to 10 years.

To be successful, a public sector reform initiative should have a broad mandate that will result in the creation of the inter-agency partnerships needed to test out the new “what is likely to work best” evidence in practical program and policy applications. It should also propose ways of systematically applying lessons learned to mainstream programming.

Source: Hicks: The radical improvement of data will transform public sector reform

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Ottawa can’t show how feminist assistance policy has helped improve gender equality globally, audit says

2023/03/29 Leave a comment

Not surprising, unfortunately. But measuring “softer” social and development outcomes is difficult:

The federal government has not done enough to track whether a policy intended to direct the country’s billions of dollars in annual development aid toward improving gender equality abroad has actually helped women and girls, a report from Auditor-General Karen Hogan says.

Ms. Hogan’s report, tabled Monday, says Global Affairs Canada could not demonstrate how the roughly $3.5-billion in bilateral development aid it provides each year to low- and middle-income countries had delivered on its commitments under the federal Feminist International Assistance Policy.

The Auditor-General took aim at GAC’s information practices, which she said it had not set up to monitor long-term results.

“These weaknesses make it impossible for Global Affairs Canada to accurately track and report on the outcomes of funded projects against the goals set out in Canada’s Feminist International Assistance Policy,” she said at a news conference in Ottawa.

The federal government unveiled the policy in 2017. Since then, Canada has been commended by international development organizations for putting women and girls at the forefront of its programs.

Ms. Hogan’s office examined whether GAC’s implementation of the policy had resulted in funding for projects that supported gender equality and the empowerment of women and girls. The audit also sought evidence that the projects were generating the expected outcomes.

Ms. Hogan told reporters the weaknesses highlighted in her report had already been flagged in an internal department audit in 2021.

Her report says that although GAC took steps to monitor the policy’s progress, 24 of the 26 indicators the department tracked did not measure outcomes.

The report says the Auditor-General’s office assessed 60 projects to determine whether GAC had demonstrated that it had tracked policy indicators associated with them. The audit found that the department had used only 35 of those projects to report on policy goals.

Ms. Hogan said her office looked at a project that used government funding in an attempt to make schools more welcoming for girls by building washrooms and handwashing stations. She said that while the government could say how many washrooms had been built, it couldn’t say whether or not girls’ school attendance had increased.

“It is imperative that Global Affairs Canada immediately act to improve its information management practices and reporting on results to show parliamentarians and Canadians the value of Canada’s bilateral international assistance to support women and girls in low- and middle-income countries,” she said.

International Development Minister Harjit Sajjan told reporters he accepts the findings of the report, and that improvements to project management and reporting are already under way.

He also said he has seen the results of the Feminist International Assistance Policy firsthand. He recalled a trip to Bangladesh, where he said he visited a slum and learned about how Canadian funding is supporting menstrual health education.

When asked by a reporter if he feels personally responsible for his department not knowing if the feminist policy is working, Mr. Sajjan reiterated that he has visited many projects and spoken with organizations delivering programs.

“What we need to do is be able to aggregate and get that information. … That’s what the Auditor-General has noted,” he said.

The report also said that GAC did not meet two of its three spending commitments under the policy. It fell short on funding projects that directly support the empowerment of women and girls, and on funding projects located in sub-Saharan Africa.

The audit also found that departmental spending from the 2020-21 and 2021-22 fiscal years was affected by the pandemic and Russia’s invasion of Ukraine.

“During this time, the department reallocated money to respond to needs emerging from the coronavirus disease (COVID-19) pandemic and the invasion of Ukraine; these reallocations had an impact on the department’s ability to meet spending targets,” the report says.

Mr. Sajjan said Ottawa had not reallocated money away from international aid.

“We looked at the denominator changes, because we had to put more funding into Ukraine, and also because of COVID. However, our funding into Africa also actually increased,” he said.

Garnett Genuis, the Conservative critic for international development, called the Auditor-General’s findings “very disturbing.”

“We hear the government talk all the time about gender when they talk about international development. But the Auditor-General’s report reveals today they haven’t even been bothered to measure the results of their work,” he told reporters on Parliament Hill.

Source: Ottawa can’t show how feminist assistance policy has helped improve gender equality globally, audit says

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How to create an adaptive culture in the public service

2023/03/07 Leave a comment

Perhaps I am getting too removed from the day-to-day realities of the public service but I find the various calls for reform are all too similar without any realistic means of implementation, whether by sophisticated academics or equally sophisticated former clerks and other senior officials.

In the case of the latter, a more reflective examination of how they tried to effect change and the roadblocks they faced would be more useful and practical than calls for change in specific areas:

Public service institutions have long been challenged to deliver a wide array of programs for governments and the public, and they continue to deliver programs and services as technology and public expectations evolve. However, what is driving change and creating anxiety in public services is the frequency and complexity of emerging new policy issues, as well as structural concerns such as competency gaps and the ability to address future issues.

This is not news to those in public management: cabinets and ministers are attuned to the policy agenda and drive policy as best they can with available resources. Climate change and environmental sustainability, working digitally, migration and immigration and an aging population are issues that have risen to the fore of an already heavy public service agenda.

For the public service to cope with these demands requires change in activities, new decision processes and institutional arrangements, and, most fundamentally, adapting its culture. By this we mean improving leadership, responsiveness and innovative capacity in working horizontally such as through a willingness to share information and responsibilities. This will be essential for consistent and productive transformation.

Multiple perspectives highlight the shifts in the way public services will have to adapt which will have implications on technology, approaches to employment and the characteristics of jobs and how public organizations maintain coherence. Four points must be stressed about the role of public services.

1. The changes in the environment will result in structural shifts in how public organizations work. Public service leaders must be skilled at anticipating shifts and conceptualizing innovative institutional arrangements, including adopting new technology, and managing the transition. Structural changes driven by technology also need capable people who can adapt and learn alongside new technology in order to be effective. This also includes rethinking several outdated administrative policies that do not reflect the evolving work environment.

2. A key driver to effective public services is a motivated and capable workforce. This means that sustainable change cannot take hold without engaged, passionate public servants who look beyond the daily grind of tending files and communicating with other public servants. Being engaged not only means contributing to the strategic direction of government and better public policymaking, but also creating and re-creating organizations to meet new needs of their policy environments. It also means attracting, developing and leading the right talent for new challenges.

3. Relying on large consulting houses to carry out policy and organizational change signals a lack of trust in the public service. One explanation could be that decision makers do not believe the public service can think innovatively. The effect is a decline in internal capability and leadership competence due to years of neglect in effective internal recruitment strategies and training. Focusing on improving service rather than perpetuating a transactional culture would go a long way to repair current dysfunctions.

4. There is always a constituency for systematic change in public institutions and we believe that is true of the Canadian public service. Public servants at all levels want to be more responsive to governments and public needs but are frustrated by the lack of support and recognition from senior leaders on ways to innovate and to improve systems and processes. On the other hand, senior leaders want to build an engaged public service, but may be focusing on the wrong things such as compliance and oversight measures.

The pandemic brought about creative ways of generating ideas and delivering public services but there are questions about leaders embracing these changes for the future. The question is how to understand change, generate reform, produce a sustainable and adaptive culture and to prepare for the future.

Lost opportunities, new possibilities

Governments have initiated high-level periodic institution-wide review efforts focused on diverse areas of public sector management. This included human resources in 2019, ongoing changes to procurement practices, changes to government accountability with the Gomery Commission in 2006 or public service operational practices and results delivery beginning in 2007. These reviews were carried out internally or independently, but rarely convinced decision-makers to institute recommended changes. In addition, the reviews did not take the other reviews and functions into account, often recommending changes that were contradictory.

Embedded regularized spending reviews could be used to drive public service reform, but these were abandoned in 2012 in Canada. The United Kingdom, Australia and Netherlands conduct regular reviews of fixed elements of spending focusing on making room for policy priorities while improving efficiencies in existing program areas. It is apparent that the federal government has initiated spending reviews but it is unclear if and how these will be linked in a coherent way to public service reform efforts. Other countries are beginning to think about linking spending reviews and reform to ensure policy and spending coherence.

Reform is multi-level and multi-faceted          

Embracing change requires adopting a dynamic approach. Multi-level reform means accepting that the public service is highly decentralized and operates in diverse areas of responsibility. Organizational structures and operating environments vary widely, and departments and agencies will know best how to respond to them. What gets in the way of relevant reforms are highly centralized systems and a lack of management autonomy to achieve expected results.

The public service depends on several important systems to work properly. Human resources involve recruitment, skills development and competency training and retention. Information and technology management is driven by digitalization, worker’s autonomy and mobility, data storage and sharing. Policy development and advice must acknowledge and balance strategic, administrative and operational elements. There needs to be effective procurement of goods and services along with sound financial management, oversight and monitoring.

Finally, there is the machinery of government and performance indicators that track results and assesses risks for their achievement. All of these must be simultaneously considered in any transformation.

Previous reform attempts, however, have tended to focus on defined problems associated with one or two of these systems. They did not recognize the complexity of how public organizations work, how these systems intersect with others, or the unique operational challenges of departments and agencies.

Reform cannot be a one-size-fits all solution. Significant discretion, in exchange for regular reporting, must be given to deputy ministers and their management teams to support administrative and management reform. As highlighted long ago in the Glassco Commission (1963) and Lambert Commission (1979), “letting the managers manage” involves providing space to public servants to improve services and implement policy without creating unnecessary administrative burden and excessive control by central agencies.

Leaders must be given room to imagine and propose changes to various systems that can be considered by the center of government in a timely way. This does not suggest a patchwork of changes without coherence, but rather a dialogue that gauges how these changes could be adapted to support the achievement of outcomes, and seriously monitors what sort of progress is being made in a tailored way.

This means looking at what has worked elsewhere and innovating with other executives in the public service to find support when there appears to be no workable solution. The central agencies must be willing to ensure tailored coherence for departments rather than uniformity and perpetuating a compliance culture.

Collaboration and coordination are critical

For change to work in such a multi-level embedded system to work effectively, additional conditions must be met. First, there must be engagement and support between ministers and the public service leadership. There also has to be a greater emphasis placed on learning, rather than managing, from the center of government. Central agenciesshould take on the role of enablers and coordinators rather than assuming primary leadership over such change.

There should be clear roles and responsibilities for executives so they can use their discretion to implement appropriate systems and processes in concert with others to ensure coherence. Administrative tools such as the Management Accountability Framework, Policy on Results, Directive on Performance Management and Policy on Service and Digital should provide stronger forward-looking emphasis and support on organizational learning in a coordinated way. Reporting on these must also be joined up to demonstrate outcomes.

These changes require a shift in sensibilities, capabilities, readiness to contribute, senior management commitment and the motivation to drive organizational change. It also needs external input from academics, think tanks and other communities – and not high-priced secretive and ungrounded consulting contracts – to work in partnership. The public service no longer has the luxury to operate as an island.

An adaptive public service for the 21st century

Other countries are using the pandemic as an opportunity to advance reforms. A key criticism of public services is their lack of nimbleness. They are comprised of organizations operating not only in silos but also as rule-bound sub-systems working within centralized, homogenous processes. Although rules and hierarchy are essential for ensuring some level of administrative and management coherence, particularly for democratic governance, they must be balanced with the need for innovation and creativity when change is rapid and often unpredictable.

Our systems must accept that change is constant, and that reform will be ongoing rather than periodic. It also means learning from past mistakes. The public service needs scope to learn and manage, connecting responsibilities more directly to their authorities and resources, joining up otherwise independent reporting, and better monitoring progress. Better monitoring and reporting would ensure that departments are better held to account for their valuable work.

Source: How to create an adaptive culture in the public service

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May: The time and place for consultants

2023/03/02 Leave a comment

Good discussion and commentary on the issues which reflect some longstanding management failures at both political and bureaucratic levels as well as the overall complexity of government and accountabilities:

Canada’s budget watchdog says it’s time for a “deep dive” into the workings of the public service to unravel why departments are spending billions of dollars on consultants while also hiring a record number of employees.

Parliamentary Budget Officer (PBO) Yves Giroux said the recent spotlight on the government’s growing dependency on contracting for professional services — for everything from policy advice to running programs — raises fundamental questions about the role of the public service.

“Do we have the public service that we need right now?” he said in an interview. “Is it well equipped to deal with the challenges and the expectations that Canadians have of the public service — especially in light of its growth in recent years and the extensive use of outside advice and services?

“I think it’s time to do a real deep dive.”

Giroux is joining a growing chorus of experts who argue it’s time to fix the public service. Former clerks of the Privy Council Office, senior bureaucrats and academics are weighing in with views on what’s wrong and possible ways to fix it.

Giroux’s call comes with the release of his latest report on the government’s spending plans. They showed the cost of outsourcing will hit a record $21.4 billion this year. Spending on contracting has increased by more than a third since 2017-18.

He said the growth of consultants during the COVID-19 crisis was expected, but it hasn’t stopped. Rather than slow down to pre-pandemic levels, contracting which shot up 20 per cent in 2021-22, is still growing at a rate of more than 10 per cent this year.

The bigger question is why departments are adding thousands of employees to the federal payroll at the same time. The number of new hires has grown in lockstep with more consultants.

“If you increase the size of the public service, it’s because you feel there are needs that need to be met. That should reduce the use of consultants, but it’s not happening. They’re both growing in line,” said Giroux.

Personnel costs are the biggest single operating cost in government. The PBO estimates the seven-year hiring boom under the Trudeau government is expected to push the size of the workforce to about 409,000 jobs within five years. 

The PBO said spending on personnel grew an average of 6.7 per cent a year – from $39.6 billion to $60.7 billion since 2015. That’s about a four-per-cent increase in compensation for each full-time employee.

Giroux said it might make sense if services were improving, but the bureaucracy is taking a beating for backlogs and delays in passports, immigration, access to information and privacy (ATIP) requests, veteran services and employment insurance.

It also doesn’t add up because the government and unions claim public servants are as productive, if not more, since the pandemic and the recent shift to hybrid work.

“Services are not improving significantly. In fact, some would say they are improving not at all… So, I wonder what’s going on? It’s a real mystery,” said Giroux.

The House of Commons government operations committee is juggling three separate probes into federal contracting. The most politically charged is the $116 million the Trudeau government spent on scandal-plagued consultants McKinsey & Company. Canada’s auditor general Karen Hogan announced she will conduct a review into the McKinsey contracts.

The committee is also widening its study to contracts of other big consulting firms — Deloitte, PricewaterhouseCoopers (PwC), KPMG, Ernst and Young (EY) and Accenture.

Many worry the committee hearings are so focused on the political blowback of tarnished McKinsey and its possible ties to the Liberals, that getting at what’s behind the growth of consultants and employees is getting lost.

Consultants, who are hired for their expertise and new ideas, never seem to leave. Once in, they get a lock on work and prevent the public service from developing its own in-house expertise.

There are no hard-and-fast rules for departments to follow on what work is best done by public servants or contractors. Many expect such guidance will be one of the recommendations out of these studies.

Treasury Board argues both are growing simply because there is so much more work. An activist government, the Liberals have fingers in many pies and ministers have mandate letters with long to-do lists. Treasury Board President Mona Fortier has saidthe cost of professional services as a percentage of federal spending has largely remained the same since 2011.

Dominic Barton, McKinsey’s former global managing director, told MPs that McKinsey doesn’t provide policy advice. Rather, it “executes” what government wants to do, be it streamlining its pay or passport processes or digitization, moving paper-based operations to electronic.

But Barton also said the public service operates in the “stone age” and the government needs to up its game with more training and new technology.

“There’s a technology transformation that’s needed in this government and in all governments. I don’t want to be harsh about it, but we’re in the Stone Age. We have to spend the money. That will need a lot to be able to do it, but it will enable the organization to do more if we do it.”

The government is heavily reliant on IT consulting. Thirty per cent of its IT jobs are vacant and the experts they need are often not interested in becoming public servants. All this scrutiny will make public servants skittish about using them which could be a problem because “government can’t run without them,” said one senior bureaucrat.

The government contracts for all kinds of services. For cleaning, security, building maintenance, translation, temporary help and IT services. A Carleton University research team studying federal contracts took a run at breaking down the kind of services consultants offered departments.

Management consulting, which is typically for advice, is a small portion of government’s contracting bill for professional services. It has grown the most since in recent years and hit about $800 million in 2021-22.

But it’s the public service’s job is to provide frank and “fearless” advice to government – advice that puts the public interest first.

The growth in consulting raises questions whether public servants have lost its capacity to provide policy advice or their advice isn’t sought or trusted. Maybe they lack inhouse expertise or savvy to be good shoppers and buyers? Or are risk-averse public servants so cowed by years of bashing and criticism they opt for the safer course of running ideas by consultants or hiring those who provide the answer they think their political masters want to hear?

A common concern among those calling for reform of the public service is the centralization of power in the prime minister’s office and the frayed trust between politicians and bureaucrats. That relationship underpins Canada’s Westminster-style democracy.

Giroux, a long-time public servant before becoming an agent of Parliament, believes the public service has the capacity to provide advice if there’s an appetite for it.

“Is it because ministers don’t trust the advice they’re getting from the public service, which would be a big issue,” he said. “I think it leads to the need for a deep dive a thorough look at the state of the public service. Is it still the public service that politicians the executive, parliamentarians and Canadians expect.”

Giroux said the public service needs a top-to-bottom review of how the public service is structured, organized and equipped to deliver the kind of services Canadians expect today. In a 24/7 world, the public service has to rethink how it works, hires, pays, manage its workers, including where they work and hours of work.

Michael Wernick, a former clerk and Jarislowsky chair at the University of Ottawa agrees structural issues are key. He says the “core software” of government – its mountain of rules, job classifications, human resources regime and technology, are outdated.

“There’s very little attention to how it works. Its internal governance and processes and structures – basically the software on which it runs is like Windows 95,” he said

Donald Savoie, one of Canada’s leading experts on public administration, has argued for a royal commission. He said the “alarm bells about the public service have been ringing for a long time” and it’s time for a debate. Savoie says he was an “academic in the wilderness” when he warned about eroding trust and the concentration of power in the 1999 book, Governing form the Centre. Now, it’s a premise that’s widely accepted.

But Savoie said any efforts to reform the public service won’t get off the ground without the support of the prime minister.

Giroux said the state of the public service has been on his mind for a while. The pandemic dramatically changed the nature and how public servants work so the timing is ideal.

He recently mused at a Senate’s committee about a nonchalance pervading the public service, a ‘broken system” and the need to “crack the whip” in some departments. He lamented the lack of a “challenge function” for public servants. They set their own targets for the programs they run, often setting the bar “not too high so that it doesn’t look too easy but neither too low.”

“There are pockets of excellence, but there are also pockets of, I would say, nonchalance in the public service. They’re overwhelmed or something is not right. Not being inside the public service, unfortunately, I cannot pinpoint what is in need of fixing,” he said.

Source: The time and place for consultants

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Critical considerations for the future of the public service

2023/02/20 Leave a comment

Hard to argue with the principles enunciated but perhaps even harder to think that this would result in meaningful change (which is hard given ministerial and bureaucratic roles and perspectives). The track record of previous reform efforts is not encouraging…:

In a December 2022 column in Policy Options, “Canada needs a royal commission to fix problems with the federal public service,” Kathryn May conveyed Donald Savoie’s reluctant call for a royal commission to explore the state of the Canadian public service and its future direction. Many different reasons were highlighted. The public service is overloaded, relying on slow and outdated processes. There has been rapid growth after COVID and yet – despite an arguably quick pivot to implement government policies – it has been slow to handle the demand for essential services. It also seems incapable of responding in a timely manner to access-to-information requests despite politicians’ trumpeting of “open government.”

We could also add that there are long-held concerns about top public servants being too responsive to the government of the day, along with central agencies micro-managing and contributing to the centralization of power in the Prime Minister’s Office. There have been concerns about declining or insufficient skills or resources, and over-reliance on consultants and human resource practices that have led to a risk-averse culture.

These issues are concerning and deserve attention, but a royal commission would not be a productive way to resolve them. Instead, implementing a review process that’s designed correctly from the beginning is important. That means striking a balance between the political side and the department leadership, regional representatives and public servants, aided by some external perspective. Perhaps most importantly, the first phase needs to be taking stock of the changes that have occurred since the pandemic especially, and understanding the motivations for change while assessing gaps in capabilities and opportunities for reform.

Why the lack of enthusiasm for a comprehensive review?

There have been more than 20 federal reviews and reform efforts since 1867, each with their own attributes. Phil Charko and Stephen Van Dinehave identified several initiatives since the 1980s. Recent initiatives such as Blueprint 2020 and Beyond2020, were not, in fact, “blueprints,” but invitations to “experiment” in a “bottom-up” way, with no systematic reporting about how the contours and capabilities of the public service and its organizations were evolving.

Likewise, former prime minister Stephen Harper’s embedded strategic and operational reviews (2010-15) were efforts to reduce costs and rethink specific lines of business internally, not efforts to reimagine the overall management of the public service. In short, there has been neither stock-taking nor a rethink of the direction of the public service overall.

One could conclude that political and public service leaders have been disinterested or unaware of the need for reform, but some former Privy Council clerks (for example, Paul Tellier and Michael Wernick) have been among those issuing calls for reform – sometimes after they left the public service. There are also calls for reform coming from academics or civil society that are difficult to ignore.

A more generous interpretation is that political and public service leaders are too focused on immediate policy priorities with few resources to call for a wide-ranging assessment. Or, like Savoie, they may experience the issues and see the need for reform but have reservations about the merits of relying on a royal commission. Indeed, they have not considered alternatives other than centrally driven, closely held senior-led approaches.

The fact is that the public service is aware of its challenges. Countless internal and external reports have provided direction for needed reforms and when given political and financial support, they can be innovative and accomplish a great deal (look to Citizens First as an example).

Most issues and frustrations are not new, but the call for sustained action and continuous reflection is more urgent than ever. However, even if largely self-managed by the public service and its leaders, concerted reform requires the interest and support of prime ministers, as well as responding to recommendations in a timely way.

Why not a royal commission?

Royal commissions vary in size and scope, are usually convened outside government and are given a mandate and budget. Commissioners are appointed, reflecting their scope, who then refine and operationalize their mandates and appoint staff, commission research, receive submissions, and hold hearings. Sometimes public servants are seconded to assist, and often scholars and experts are asked to provide advice and undertake research. The entity works apart from the public service and can take on a life of its own. It is more of a topical treatment than a cure.

Moreover, though often quoted, royal commissions seldom show tangible results in actual public service reforms or behavioural change. They are excellent for spotting or tapping into talent, developing new advisory networks, consolidating knowledge and identifying new approaches and generating new ideas.

However, given the changing political environment and working in a social-media environment, governments have not been willing to convene royal commissions. Instead, public inquiries have been the preferred approach – and only if there has been a serious failure or scandal such as the Gomery Inquiry or the Phoenix pay system.

Aside from the mechanics of how to better deliver on its responsibilities, what has not taken place since the 1960 Glassco Commission is an analysis of the organization and delivery changes in public responsibilities. This seems important in the wake of the pandemic.

An understanding of how programs and the public service have evolved, an appraisal of recent practices, new ideas about future directions and removing barriers for transformation is needed. Given the pace of change and the institutional limitations, royal commissions, blue-ribbon panels and task forces are unlikely to be accepted nor perceived as useful internally if they are regarded as one-time initiatives. Likewise, a top-down internal approach modeled on PS2000 (1989) or LaRelève (1997) will not generate the legitimacy and commitment from public servants.

What are some considerations for ongoing review?

Several key elements are critical for reviewing how the public service has evolved and what needs to happen next. The design must acknowledge the realities of working in and around public services, how change takes place and what is required to anchor it over time. These include:

1. Institutional complexity. The federal public service is extremely large, with more than 80 departments and agencies employing approximately 320,000 people in 2020 – a number that is expected to increase to more than 400,000 by 2025. An overly centralized approach is likely to be met with resistance, if not outright rejection. The public service is disparate, disaggregated and decentralized. The process must anticipate the differences in mandates, responsibilities, structures and cultures, and at what level changes or reforms are needed.

2. Engaging the diversity of public-service talent. Public servants from various areas must be engaged and must participate. Different competencies will be needed to understand change and reform efforts while taking advantage of central versus regional perspectives.

3. Tapping into external perspectives. Practitioners leading the initiative may need to heed various external perspectives. For example, including the beneficiaries of programs and services could help to understand the changing nature of relationships with vulnerable communities, the shifting boundaries between public and private, and the interconnectedness of jurisdictions and responsibilities. Current efforts to address public health reforms is a good example.

4. Anticipating how reform actually takes place. Few believe that top-down reforms or “fixes” will have much impact on behaviours. Change and innovation stem from meeting governmental priorities as expressed by ministers through mandate letters or other directives. These should determine how departments and agencies organize themselves if accompanied with appropriate financial and political support, and related accountabilities.

5. Effective reform is ongoing. This is about developing an approach to reform that requires introducing new operational repertoires dependent on data for evidence-based decision-making. Instead of one-time exercises, ongoing reviews must be built into routines with a learning focus that feeds departmental plans.

6. The need for political attention, monitoring and reporting. No approach will be effective if efforts are not properly monitored so that public servants can visualize real-time shifts by leaders and the implications for their place in these changes.

In short, forward-looking decisions must be undertaken that balance the perspectives of politicians and staffers, public service leaders, regional bodies, rank-and-file public servants, and concerned and affected citizens. The way forward is to move away from subjective and sporadic reform efforts to a routine system that generates institutional learning based on ongoing evidence. This will take significant commitment to create but may generate the momentum needed that previous reform efforts could not sustain. For the present, however, an initial analysis of changes occurring, understanding motivations for change, assessing gaps in capabilities, identifying opportunities for reform and future needs should be undertaken – and be done quickly with clear steps throughout.

Source: Critical considerations for the future of the public service

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Wolfson and Castle: Ottawa’s new health funding is tied to better data. What will that really mean?

2023/02/14 Leave a comment

Good data discussion on outputs vs outcome measures, with the latter harder to measure but more important:

The federal government has just offered the provinces and territories substantial new funding to address the obvious failings in Canada’s health care sector. They have also rightly coupled reform with major improvements in health data collection, including the need for new and better indicators to measure progress. As Prime Minister Justin Trudeau has repeatedly said, “What gets measured gets done.”

But as with all data, the devil is in the details.

What exactly are health outcomes? Are they the same as health indicators? How will they be measured, and how can we ensure they are reported meaningfully and transparently for all Canadians? And most importantly: Will new health data meaningfully improve health care for Canadians?

In health care, for example, indicators can include the percentages of Canadians who have access to a family care team and the number of new family care practitioners; in fact, these are two of the indicators specified by the federal government. But while these are valuable, neither measures a health outcome. Instead, these indicators provide information on volume and accessibility for a key input in health care, namely primary care.

To the extent that these indicators can provide more detail – for example, by ethnicity or socioeconomic status, which should be essential lenses – they can shed light on important issues of equity and timeliness of health care. And as these indicators are tracked over time, they can provide a partial picture of whether health care is improving.

But health-outcome measures go beyond indicators, and require more detailed kinds of data.

A health outcome needs to consider a patient’s health status both before and after an intervention, such as a knee replacement or cataract surgery. It’s not just the waiting lists that matter; we also need to know how often a knee replacement has to be redone within a short period of time, or how frequently a cataract surgery fails to improve vision as much as anticipated.

Regularly measuring these kinds of health outcomes is fundamental to learning how well different parts of health care are performing, and whether we are receiving quality health care in the most cost-effective manner.

So how does this understanding of outcomes align with the federal government’s proposed “indicators” and data initiatives requirement? Short answer: we don’t know.

Provinces and territories have control over what health care data are routinely collected. For example, if we really want to know about health outcomes related to primary care, we first need to understand the various ways primary care is currently delivered – whether by solo fee-for-service doctors, or by teams, which include nurse practitioners as well as physicians who are remunerated by capitation, or some other model.

There is enough variety in primary care delivery across Canada that it should be possible to learn what works best by careful and probing comparisons across and within jurisdictions.

We then need to follow samples of individuals over time, to track which mode of primary care organization has patients with fewer illnesses, fewer hospitalizations and longer lives.

It is only with these kinds of longitudinal, person-level data that we’ll be able to produce evidence on which we can base valid indicators of health outcomes, and connect them to jurisdictions’ current and evolving ways of providing primary care to their residents.

Will the provinces collaborate, agree on standardized definitions and, with federal financial support, make the investments needed so these critical data become available? The federal government’s wording on this is ambiguous: “To access their share of the federal funding, including the guaranteed 5 per cent growth top-up payments to the CHT, for the next five years, provincial and territorial governments are asked to commit to improve how health information is collected, shared, used and reported to Canadians to promote greater transparency on results.”

Is this general statement merely cajoling, or is the federal government actually waving a serious fiscal stick? That will ultimately dictate the data outcome, because past decades of federal initiatives have repeatedly shown that if Ottawa fails to wield meaningful fiscal penalties, the momentum on serious health care reform is bound to face disappointment.

Michael Wolfson is a former assistant chief statistician at Statistics Canada and an adjunct professor in the faculties of medicine and law at the University of Ottawa. David Castle is professor of public administration at the University of Victoria. They both served on the Expert Advisory Group of the Pan-Canadian Health Data Strategy convened by the Public Health Agency of Canada.

Source: Ottawa’s new health funding is tied to better data. What will that really mean?

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Lynch and Mitchell: Instead of adding new programs, Ottawa should focus on proper delivery of the ones it has

2023/02/14 Leave a comment

Likely a perennial refrain among officials having to respond to political-level demands but valid nevertheless as capacity limits of the public service in areas such as passports, immigration and others have become painfully apparent post-pandemic.

Of course, one of the ironies of former DMs and ADMs raising these issues is that the vast majority rose up through the policy ranks, helping governments introduce new programs, rather than in service or delivery!

And one should not underestimate the difficulty of briefing the political level against a particular initiative or program based on service delivery grounds:

Most Canadians expect value for money in their spending, especially in these uncertain and inflationary times. With worker shortages, empty offices, supply chain woes, high energy prices, soaring inflation and painful accommodation costs, Canadian consumers are worried about their financial health.

But what about governments? Are they delivering value for Canadians’ hard-earned tax dollars? For anyone seeking a passport or visa, lining up for airport security screening, trying to get a Nexus card, waiting for a routine medical procedure or watching government procurement systems that cannot deliver payroll, the answer is unambiguously negative.

Core government services are not being delivered well today, and this not only erodes confidence in government as an institution – it also undermines productivity and competitiveness in the Canadian economy.

What are the causes? While there is no single answer, it is clearly not due to a shortage of spending, public servants, consultants or debt. At the federal level from 2015 to 2022, the size of the public service grew by 30 per cent, the use of consultants shot up 40 per cent, government spending skyrocketed by 66 per cent and government debt almost doubled. In short, the size of government expanded, considerably, while the efficiency of government declined, noticeably – not a good combination.

In fact, the stratospheric and scattered spending is one root cause of the delivery problem.

Before, during and since the pandemic, the federal government has unleashed a vast array of new programs. New program delivery is complex and time-consuming work, requiring highly capable, experienced and empowered public servants. Indeed, “delivery” is the nuts and bolts of policy implementation and program operations – it encompasses the design of new programs, the stress testing of the design to avoid unintended consequences, ensuring robust IT and data systems to support the program, the hiring and training of staff, establishing quality control and compliance systems, and communicating to the intended beneficiaries how the program works.

There is a risk of moral hazard here – as governments try to do more and more, they may end up achieving less and less. The problem arises from the scale, scope and speed of new spending. Too many new programs, with too little prioritization, that are too quickly rushed to the “press release stage” is a recipe for delivery problems, not only of the new programs but also related existing programs on common platforms.

Today’s reality of government not being particularly good at actually delivering things – both core services and new programs – should be a matter of concern well beyond the Ottawa bubble. If you believe what government does matters to Canadian society and the economy, as we do, then less-than-stellar delivery of government services neither serves the public interest nor bolsters the public’s trust in our institutions of government.

What can be done? Like any complex problem, there is no single solution, but four possible actions deserve serious consideration.

First, pause the proliferation of new spending and new programs. This is needed to restore operational integrity and program delivery capacity as well as to support fiscal sustainability in a period of high inflation, high interest rates and high debt. And yet, the risk today is a proliferation of new government programs and the scaling up of existing ones ranging from new industrial policies to new energy transition programs, national dental care and pharmacare, new health transfers, increases in defence spending and expanded immigration. Whatever the policy merits of these proposed initiatives, this is simply not the time to expand government. Rather, it’s the time to refocus on meeting the expectations of Canadians for quality and timely delivery of government services.

Second, reverse the extreme centralization of decision-making within government. This is necessary for better governance as well as better program delivery. Too much decision making has been vested in the Prime Minister’s Office at the expense of ministers, cabinet and Parliament. Ministerial accountability and collective decision making, with fearless advice from an empowered, non-partisan public service, are central to our Westminster system of government. The sad fact is we have strayed far from that guiding ideal.

Third, modernize the architecture of compliance and oversight within government. This requires a profound shift from an operating culture of control and risk avoidance to one of innovation, risk taking and delegation. In the name of protecting the taxpayer, there is a compliance morass pervading government today, with overlapping oversight bodies, excessive red tape and needless reporting – all of which impedes getting things done and delivered.

Fourth, invest in the public service. This is not a call for a larger public service but a better equipped one. The public service needs the IT and data systems that allowed the banks to develop online banking and companies like Amazon to revolutionize delivery. It needs the skill sets for a digital world not an analog one, and should engage consultants as the exception not the rule. The public service should be an exciting place to work, empowering public servants to make a difference and attracting the best and brightest – and public servants are up to the challenge.

Better service delivery is in everyone’s interest. These changes would result in a higher-performing, more productive public sector. That should be part of Canada’s competitive advantage in a challenging world.

Kevin Lynch was clerk of the Privy Council and vice-chair of BMO. Jim Mitchell is an adjunct professor at Carleton University and a former assistant secretary to the cabinet.

Source: Instead of adding new programs, Ottawa should focus on proper delivery of the ones it has

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Wernick: The never-ending question of contracting in the public service

2023/02/13 Leave a comment

Interesting how some former clerks remain silent in retirement and others like Wernnick, play a useful public role in sharing their reflections over the unsolved (and perhaps unsolvable) systemic issues of government and governing:

Over the last few months, we have seen a rising tide of interest in the use of contracted services by the federal government. The latest episode seems to have crystallized around the use of consulting firms, notably McKinsey & Company. It has triggered another round of partisan squabbling at a parliamentary committee and the pack of journalists who cover politics are piling on, unsure of what narrative is the most important.

It is not clear what “theory of the case,” if any, is driving the current flap. At its simplest, the Opposition and the media are drilling wells hoping for a political gusher. Can they find something untoward in the contracting process? Can they find something troubling in the relationship with a particular supplier? Can you show poor value for money? If they can’t find proof of anything untoward, a stream of insinuation can still generate political rewards.

The more interesting angles to this are about whether the use of outside contractors is a sign of weakening capacity by the public service, at least the federal version, or augurs of a dangerous dependency. That is far from clear as a diagnostic and, once again, the point would be what tangible actions anyone is prepared to take to do something about it. For me, the issue is not whether to use outside suppliers of services, but how to use them to best effect.

There is nothing new about governments at every level acquiring services from outside suppliers, and no iron rule to lean on as to whether work is best done by public servants or contractors. It is a matter of judgment, informed by business choices around cost, timeliness and quality, and by ideological preferences about the role of the state.

There are three ways to get a flow of work done: by permanent public servants; by temporary public servants (term appointments, casuals, seasonal workers, students); or by outside contractors. The first two fall under “staffing” policies and processes, while the third falls under “procurement and contracting.” All three generate costs for the government. These days, Ottawa spends roughly $50 billion on its public service and $15 billion on contracted services. Is that mix the right one? If you want to dampen or cut government spending, which should be cut more deeply?

Permanent public servants are expensive, carrying a premium beyond their salaries in terms of benefits and future pension costs. They are difficult to move around and almost impossible to terminate for poor performance. They are entangled in a complex web of collective agreements and human resource mechanisms. They do however bring experience, expertise, loyalty, engagement and an orientation to the public interest, as opposed to short-term profit. The smart business choice is often to build up and develop sustainable capacity within a public service entity.

But the truth – uncomfortable for some – is that sometimes it makes more sense to go to an outside supplier where a pool of expertise resides. Just as the private sector does, it often makes sense for governments to outsource services, whether they are ongoing or related to a specific project with finite time frames. A large consideration is matching supply to demand.

The federal government is actually more than 300 distinct entities, most of them small, working on a vast array of tasks and projects. It would make little sense for each of them to build up permanent staff and cost structures to deal with the episodic need for some kinds of work. That is why there is a range of internal service providers such as Public Services and Procurement Canada, Shared Services Canada and the Translation Bureau. It is also why bringing in outside firms often makes sense.

It is commonplace and relatively uncontroversial now for governments to contract building maintenance and security, to retain external auditors and to hire legal counsel with specific skills. The federal government contracts translators and interpreters for specific events or tasks. It contracts communications firms to develop and place advertising, and to conduct market research to find out what users and citizens are thinking. I can recall a period of controversy about using temporary help agencies for administrative work.

As governments have moved more and more of their transactional and information services to the web and phone apps – while chasing rising expectations for speed, accuracy, cybersecurity and personalization – they have turned to firms that work with large private sector clients around the world that are wrestling with similar challenges. At their best, these firms help upgrade both the hardware and software of government technology, and train public servants to work with whatever is the emerging toolkit.

The pressure to continuously improve externally facing services and the internal services that support them make it sensible to retain firms that have worked with other governments and with private sector firms on queue management, customer relationship interfaces, customization of offerings, and protection of privacy and security. It is simply not true that public servants could keep up all by themselves. Nor is it true that all the people with the skills and knowledge needed by governments want to become public servants. Nor is it true that private firms always do good work – as we saw with the Phoenix pay system and with some apps, such as ArriveCAN – or do it at less cost.

What seems to be troubling some observers is the use of “management consultants,” which is a very elastic term. At their best, firms can offer an outside perspective on business processes, internal governance, organizational maturity, costing, risk management and other management issues. They can draw on international networks and expertise gained from working with a range of clients. For the public sector, they can be a useful antidote to inertia and the culture of “but that is the way we have always done things.”

The private sector uses external advisers extensively. I worked with several ministers who were highly sceptical of public service advice and insisted on running the issue by an outside firm with a big reputation before taking a decision. During spending reviews, ministers reflexively turn to outside advisers because they assume, with some justification, that the public service won’t be willing to challenge itself or consider new approaches.

The current McKinsey episode has surfaced concerns that advisory firms are starting to play a bigger role in decisions about policy – the “what” government chooses to do, as opposed to “how” it does it. It has also raised concerns that the public sector can become too dependent on outside firms with a profit motive and an interest in generating future work and billings. These are valid topics for scrutiny. Public service unions make valid arguments about the potential exploitation of gig workers with little job security or benefits at these outside firms. But there are valid arguments for using outside suppliers that can’t be dismissed as mindless privatization.

The boundaries between insourcing and outsourcing have always generated controversy. Can we use these brief periods of attention to do something about it beyond scoring short-term points?

The politicians and pundits who now argue for less use of external advisers should commit themselves in action or argument to a doubling of the resources allocated to training public servants and to a much expanded program for interchange of permanent staff between the public service, and the private and not-for-profit sectors. They should also endorse greatly expanding the resources used to acquire outside perspective and fresh ideas from the supply chain of think tanks and academic centres.

To be an intelligent buyer getting value for money for taxpayers and citizens, the public service must always invest in its leadership cadre, in its capacity in vendor management, in project management, and in its processes to onboard and internalize the skills and knowledge that working with outside advisors can provide. It should be possible to create a positive feedback loop and learning cycle that makes the public service better.

Source: The never-ending question of contracting in the public service

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