This article originally appeared in The Hub.
By Tim Sargent, December 11, 2024
It has taken until nearly the new year, but Finance Minister Chrystia Freeland is poised to table the federal government’s fall economic statement next week. Anyone expecting the government to have adhered to its own fiscal guardrails will surely walk away disappointed, as many anticipate that the deficit now far exceeds the $40-billion limit the government set last year. Freeland has already pre-positioned as much. Reportedly, the number could be as high as $62 billion.
If true, that Freeland would release a statement that oversteps her own government’s own red lines in such an egregious manner, provides little assurance to markets or Canadians that this government understands the severity of the crisis it is up against. Restoring fiscal credibility is paramount. While belt tightening clearly does not come easily to the Trudeau government, here are some directional steps Freeland and Trudeau ought to take to give Canadians the confidence they aren’t going to keep blowing through their fiscal anchors.
Crucially, they could start with the size of government itself.
You do not have to be a believer in big government to recognize the value of a competent, honest, and efficient public service. From defending borders to managing immigration to promoting food safety to ensuring a clean environment, public servants are essential to the functioning of any advanced country.
But Canadians are not happy with the federal public service. When polled, 45 percent of Canadians said that they were unsatisfied or very unsatisfied with services provided by the federal government, compared to 33 percent for provinces and 29 percent for municipalities. The ArriveCan scandal, long waits for passports, endless delays in procurement, and the Phoenix pay saga—these have all sapped Canadians’ confidence in a public service that used to command respect across the world.
The irony is that this dissatisfaction comes not after a reduction in the size of the public service, but after a massive expansion: between 2016 and 2024, the number of federal public servants grew by 42 percent, compared to a private sector workforce that grew by only 11 percent. It seems that for the federal government, more is in fact less.
This does not mean that there are not many amazing public servants who are dedicated to serving Canadians: there are, and I was fortunate enough to work with many of them in my 28 years in government. However, they are mired in a system in which there are too many conflicting priorities, too much hierarchy and red tape, too few consequences for poor performance, and not enough emphasis on the skills required in a 21st-century workplace.
This must change. The public service must become both leaner—taking fewer Canadian’s tax dollars—and meaner—much more focused on achieving results.
This starts with the federal government refocusing on its core constitutional responsibilities such as defence, border security, and immigration, and not expanding into areas of provincial responsibility such as childcare or drug coverage. Federal public servants simply do not have the experience or proximity to the client base that their provincial counterparts have, and there is considerable room for reducing headcount in these and other areas where the federal government overlaps with provincial governments.
The federal government also needs to reduce headcount in its internal services, which have grown rapidly in recent years. The advent of artificial intelligence is a golden opportunity to automate routine administrative tasks, particularly in HR and procurement.
The public service’s management structure is too top-heavy, blurring responsibility and reducing efficiency. Five executive levels and four deputy minister levels are too many, and there is no real need for the many associate deputy minister and associate assistant deputy minister positions that have popped up in recent years.
There needs to be a clear shift to focusing on actual outcomes that matter to Canadians. This needs to start at the top. Deputy ministers should be given clear, measurable objectives that are then clearly communicated down into departments. At the heart of the poor performance of the public service is an obsession with process and box-ticking that reflects a system that values a quiet life and not rocking the boat over getting better outcomes for Canadians. Any focus on results is further blurred by the virtue signalling that now seems to be expected of executives and managers.
A renewed focus on getting things done needs to be accompanied by clear consequences for both good and bad performance. Strong performers need to be rewarded, and weak performers penalised and ultimately fired. Unfortunately, pay doesn’t reflect performance for most public servants, and dismissing someone is a long and arduous process. Managers need to be empowered and incentivised to deal rapidly with poor performers.
Finally, the public service needs to recruit and promote the kind of people who can deliver results. As Professor Donald Savoie argues in his recent book, Speaking Truth to Canadians about the Public Service, the public service has too many “poets”—those who propose and analyze policy—and not enough “plumbers”—those who actually implement policy.
This is compounded by a prioritisation of identity over actual skills and experience: every public servant should know that they got where they are through their own efforts, not in fulfillment of an arbitrary quota. The public service needs to hire more people from the private sector who know how to implement projects and how to make processes more efficient: this will require restructuring a public sector pay scale that underpays for many of these crucial skills while overpaying in many other areas.
It will also be very important to invest in training and to continue to hire young people and students—trying to avoid layoffs by shrinking training budgets and freezing hiring, while politically more palatable, is an unbelievably short-sighted approach to downsizing the public service.
None of this will be easy to implement. But change is possible. Public servants are like anyone else: if they are given strong leadership, clear objectives, and are held accountable for what they do, they can deliver. Without those things, the slow atrophy of what was once considered one of Canada’s greatest assets will only continue.
Tim Sargent is the director of the Domestic Policy Program at the Macdonald-Laurier Institute.
