Friday, April 18, 2014

Fiscal conservatism seems alive and well in Ottawa: 8,900 public service jobs to be cut

When Conservatives under Stephen Harper took office in 2006, I was disappointed at how much they resembled their predecessors when it came to their penchant for increasing the size of government.

In the first five years of Harper’s Conservatives, federal spending increased an appalling 22 per cent. Much of that was, of course, due to stimulus spending to counteract effects of the 2008-09 global financial crisis—$24.9-billion in 2009-10 and $20-billion in 2010-11. According to a government performance report tabled in the House of Commons in late November 2011, federal expenditures in 2010-11 totalled $270.5-billion, compared with $222.2-billion in 2006-07.

Far more worrying, though, was the fact that during those years the Conservatives grew the public service more than any government in the prior 20 years. They added about 45,000 jobs from 2006 to 2011.

Fortunately for overburdened taxpayers, the Harper team launched a program in 2012 to reverse the trend and reduce the public service. The plan—currently on track—includes eliminating 30,000 federal jobs by 2016-17, returning the public service to the size it was in 2006 when the Conservative party came to power. To meet that objective, the public service will be reduced by another 8,900 jobs.

There’s a lot more to be done, of course. Performance management is a huge issue. As Treasury Board President Tony Clement recently remarked, “…there are more public servants dying at their desks than being dismissed for underperforming.” He said the dismissal rate in the public service was only 0.06 per-cent compared to a five to 10 per cent rate in the private sector.

Moreover, government employees move up one step on a five-step pay grid every year and automatically receive an increase in pay until they hit the maximum rate, regardless of performance on the job. There’re also issues with sick pay.

Public sector wages and benefits outpace that of the private sector by a wide margin and are the government’s largest annual cost. Fiscal responsibility, therefore, demands close financial control in this area. Apparently, our federal government is trying to do just that.

1 comment:

  1. how does one rate underperforming in government when no one produces anything.