Are there 80,000 reasons that Alcock borrowed a page from Gershon?

Posted on May 11, 2009


“In what has been described as the most significant restructuring of public services for a generation, the rest of the $21 billion (in savings) will have to come from overall efficiency gains such as improving the procurement system, and streamlining areas such as information technology and human resources.  That’s why the skeptics are skeptical.”

In case some of you are wondering if I am just repeating what I had written in Saturday’s post regarding Reg Alcock’s statement “that the “federal government is on the verge of launching the biggest transformation in the way government is managed in its history,” the above comment was made during a July 22, 2004 BBC interview with Sir Peter Gershon.

In the BBC interview, it was announced that the “government’s plans to cut bureaucracy” and in the process “save” £21 billion over a four year period were based on “Gershon’s Review.”  The Review, which was referred to as “a modern bureaucrats Doomsday Book,” emphasized that the savings would be achieved by way of a recommendation to cut at least 80,000 civil service jobs and the introduction of greater process efficiency – think shared services.

I can only wonder where attrition and retirement came into play in Gershon’s vision of a leaner and a more efficient government?  A question that takes on even more meaning given a May 6, 2009 article in the Financial Post titled “Pink slips replace gold watches.”

Citing the fact that “even before the market crash the average retirement age for men – which hovered at 63 from 1982 through 2005 – had started to rise,” the article went on to state that “Older Americans have gotten the message,” in that they will have to “work longer to make up for the hit their savings have taken,” as a result of the recent economic crisis.

According to economist Alicia H. Munnell, who is also the director of the Center for Retirement Research at Boston College, the “wealth shock” as she called it means that everybody is on average “going to have to work two years longer to make up for investment losses.”

While these results reflect an Americanized view of the world, the fact remains that they nonetheless bring to light one of the many potential flaws in the Government of Canada’s Shared Services strategy.  (Another major challenge, which was disclosed during an interview I had with a senior director from a large multi-national vendor, will be the subject of my next post.  This individual, who spoke on the condition of anonymity, indicates that the government’s current plan to engage one or two suppliers to support their Shared Services platform over an eight year period is doomed to fail because the terms of such a contract pose too great of a risk to most vendors.  The inference here is that ultimately the least desirable vendor(s) will win the business because the most capable will be reluctant to tie-up their resources unless an iron-clad agreement can be reached.  A scenario that very few vendors believe is likely to occur given past experiences with the public sector – my source specifically referred to the helicopter acquisition.)

Given the obvious similarities with the Gershon Efficiency Review, combined with the current economy’s impact on savings is one of the reasons why the paucity of supporting data regarding the GoC’s Shared Services strategy is problematic.  In short, show the public how the goals associated with the program will be achieved without significant job loss.  It should be fairly straight forward.

As I had indicated in my Friday post, I am going to just keep my eye on the ball.

Strategy Development Council Meets in Ottawa Today

The Acquisition and Material Management Strategy Development Council “AMMSDC” meets in Ottawa today (Monday, May 11).

For those of you unfamiliar with the council’s work – which unfortunately represents the majority of people as the group has conspicuously conducted their two prior meetings in ersatz secrecy- the AMMSDC is an undertaking that was launched earlier this year by the Service Sector of the Treasury Board Secretariat.

The focus of the council is on developing what is being referred to as “a principles-based strategy that will provide the framework for making decisions regarding the management and delivery of internal services within the Government of Canada (GC).”  A key objective of what is referred to as the “Service Strategy” is to “position the GC to make prudent, high impact and sustainable investments that will modernize how it operates its internal functions.”

The functions or “six internal service domains,” being reviewed include; Acquisition and Materiel Management, Financial Management, Human Resources Management, Information Management, Information Technology and Real Property Services.”

A Service Strategy Development Council has been assigned to each “domain,” and charged with the mandate of considering the “potential for delivering internal services” utilizing “different service delivery models.”  The results of the sessions will be reported back to an ADM-level Coordinating Committee and a DM-level committee, who in turn will provide input to a Cabinet Committee.

The Council, which convened for the first time on February 5th, with a follow-up session in March consists of senior government officials from both the Federal and Provincial levels as well as “other representatives from the private sector.”  Today’s meeting represents the third session, and will hopefully pave the way to a fuller and more public disclosure on what was discussed and the anticipated course of action the government plans to take relative to modernizing its internal functions.  It should be interesting.

CFIB’s Pohlmann to be interviewed on PI Window on Business

On the May 14th PI Window on Business Blog Talk Radio show I am joined by the Canadian Federation of Independent Business’ (CFIB) Vice President for National Affairs Corinne Pohlmann, to discuss how the evolution of Government policy is impacting the more than 105,000 CFIB small and medium-sized business members across Canada.  Note: as a means of providing some degree of context relative to the significance of the number of businesses the CFIB represents, the three associations referenced in Minister Paradis’ press release have a combined membership of 28,383 medium, small and large businesses.

Be sure to mark Tuesday, May 26th on your calendars so that you will remember to tune in to the first of four PI Window on Business 90-minute Specials.  In this initial Special titled “For Want of a Nail: The Pandemic Effect,” I will be joined by Nick Kelley, a researcher from the University of Minnesota’s Center for Infectious Disease Research and Policy, and the lead author of the November 2008 white paper “Pandemic Influenza, Electricity, and the Coal Supply Chain (Addressing Crucial Preparedness Gaps in the United States), to discuss the true nature of the latest swine flu crisis in terms of its potential impact on supply chains.  It is a show you will not want to miss!

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