Chair:	* Rick Thorpe (Okanagan-Penticton L)
Deputy Chair:	* Evelyn Gillespie (Comox Valley NDP)
Members:	* Pietro Calendino (Burnaby North NDP) Hon. James Doyle (Columbia River-Revelstoke NDP) Hon. Helmut Giesbrecht (Skeena NDP) * Rick Kasper (Malahat-Juan de Fuca NDP) * Steve Orcherton (Victoria-Hillside NDP) * Erda Walsh (Kootenay NDP) * Murray Coell (Saanich North and the Islands L) * Gary Farrell-Collins (Vancouver-Little Mountain L) * John Weisbeck (Okanagan East L) * Jack Weisgerber (Peace River South Ind)
Clerk:	Craig James
* denotes member present

[ Page 1123 ]

The committee met at 12:12 p.m.

[E. Gillespie in the chair.]

E. Gillespie (Deputy Chair): We'll begin with the performance audit of the management of travel, with a presentation from the Ministry of Finance. We'll start first with the office of the auditor general. If I could ask each of you to introduce yourselves before you speak for the purposes of Hansard, then we'll be open for questions afterwards.

G. Morfitt: Madam Chair, this will be the last item, for now, that we'll be discussing from this report entitled "1999 Follow-up of Performance Audits/Reviews." Our office has had a chance to see the material that the witnesses for this matter have brought with them today. Our feeling, as a result, is that our office's only need for the committee is to provide a little background as to what the reporting has been and what the consideration by this committee has been over the last few months. Then we'll just turn matters over to Mr. Collisson, Mr. Tannhauser and Mr. Scale and let them make their presentation. I asked Endre Dolhai if he would just provide a little background information to the committee first.

E. Dolhai: I have with me Kathy Crawley, who was the person responsible for this original audit. Like George mentioned, we have a very short presentation, which basically just talks about the purpose of the original audit and our overall conclusions. Our presentation also showed the recommendations and their implementation status. However, we talked to the ministry people, and they said that they included that in their presentation as well, so we don't feel that it's necessary to duplicate it. So they will deal with the recommendations.

We will start with why we did the original audit and when we did it. In April 1997 we reported the results of our audit on how travel was managed in the British Columbia government. In May 1999 we reported on the Ministry of Finance's progress in implementing the recommendations arising from that report.

The purpose of this audit was to assess whether travel in the British Columbia government was carried out at a reasonable cost and was managed efficiently. We concluded that the government could make substantial savings on its travel expenditures by improving the way it manages travel. At the time of the audit, the lack of information hampered the government's ability to manage travel effectively. We also concluded that the direction provided to employees was piecemeal, not easily accessible and often incomplete. Employees received little guidance in making cost-effective travel choices. There was no central monitoring on how travel dollars were spent and the extent to which policies were effective. As a result, it was difficult for government to maximize purchasing power.

[1215]

The rest of the presentation deals with recommendations. You have a handout of our slides, so if you would like, you can follow it on our slides or follow the presentation on the slides that were provided by the ministry.

A. van Iersel: With us today, as has already been mentioned, we have three guests or witnesses to speak to this topic. We're very pleased to update the Public Accounts Committee on the progress that has been made since the original audit that is reflected in the auditor general's update, which came out last spring.

First we have Mr. Ron Tannhauser, of my office, who's responsible for financial policies included in our various forms of manuals. We also have Mr. Dave Collisson from the Purchasing Commission. What I should say is that travel responsibility is shared amongst these three gentlemen in the sense that the Purchasing Commission is responsible for hotel rates and listings, car rental agreements, preferred travel agreements, fleet arrangements and also discussions with airlines, from time to time, on how to make better use of those.

[R. Thorpe in the chair.]

We also have with us Mr. Wayne Scale from PSERC, who's responsible for CHIPS and also for employee benefits and can most appropriately speak to meal rates and allowances and kilometric reimbursement.

The only other thing I'd like to say off the top -- and I wouldn't ascribe this all to the original auditor to our efforts, but we did pull the amount of travel from our public accounts. . . . In '94-95 total spending was just over $70 million. In 1998-99 the figure had dropped to $55.8 million, so that's quite a significant drop. I don't think it's all attributable to the efforts of ourselves; I think it also reflects the restraint program in government, which has been tightening for a number of years.

With that, I'd like to turn it over to Mr. Tannhauser, who will do the main part of the presentation. Then they're open for questions.

R. Tannhauser: I'm with the financial management branch. We've prepared a presentation touching on the 11 recommendations of the auditor general's office. We haven't prepared slides to go with this. But each of the members has received a handout of the hard-copy presentation, so we can track through that together if that is acceptable.

Of the 11 recommendations that were made, as you can see, we agreed jointly that six have been fully implemented. Five out of the 11 have been partly implemented, and we will go through those today and discuss what we have done in each case.

The first recommendation was basically to implement the recommendations of the 1995 travel review that was prepared by the government. This is noted as partly imple-

[ Page 1124 ]

One of the other recommendations that had been addressed in a different way than initially recommended was handling minister's office travel. We didn't go exactly with the recommendation of the auditor general. But the paper flow process has been modified, so it's a little bit more efficient. What we did is take the ministry's senior financial officer out of the paper flow, and that's made it more direct. It goes right from the minister's office to the ministry responsible for making payments on it, so that's been streamlined.

[1220]

In the longer term, a corporate travel component will hopefully be added to the corporate accounting system and interface to the electronic travel voucher that I'll mention in a minute. I had a chance to speak to the CAS office this morning. The initial thrust is to get all ministries of government onto the corporate accounting system. Then we can look at things like adding specialty modules such as a travel component. So this will be further out. It'll take till April 2001 to get all of the ministries onto that system. Then we'll look at enhancing the modules.

Recommendation No. 3, to basically consolidate policy, provide direction to travellers and prepare a pocket guide for travellers -- the auditor general acknowledges that that is fully implemented. We have consolidated our policy as much as possible into the general management operating policy of government, which is Treasury Board's policy. We are building an electronic search capability through the Intranet and Internet to help travellers find the necessary policy.

Another source of information for travellers is the Purchasing Commission web site, which provides valuable information for travellers in various situations, such as out-of-country travel. We have produced a pocket guide to help business travellers. That was given to each of the members by the Clerk so that you can see what we have produced. This consolidates all of the key policy around travel into a handy guide that travellers can carry with them. We've attempted to provide direction through that and through other things, such as the Purchasing Commission's web site.

Also, in terms of monitoring what direction should be given, we are monitoring travel industry developments for potential savings. We certainly feel that we're doing well in terms of the hotel rates and the car rental allowances we get. We're currently monitoring the relationship between airlines and travel agents to see if something can be done to save money for the government through that means.

Recommendation No. 4 had to do with monitoring expenditures and ensuring that value for money is maximized and that policy objectives are achieved. This is noted as partially implemented. We have various agencies that are responsible for different elements of the travel of government. So expenditures in the business travel account, which I mentioned, are monitored by the Purchasing Commission. We have a preferred travel agency agreement program, which we've. . . . It's a master standing offer entered into with travel agencies and car rental agreements. Those are also monitored by the Purchasing Commission.

Government is encouraging the deployment of videoconferencing where it's a substitute for travel. We have the American Express card, which travellers are using. We monitor the transactions on that through the provincial treasury. Lastly, we've got a travel policy, which is developed by the office of the comptroller general. The one thing that we haven't done. . . . I guess why it's partly implemented is that everything to do with travel has not been consolidated in one office; there are these variety of offices that have responsibility.

Recommendation No. 5: "Communicate guidelines and examples of cost-effective travel choices to employees." This is acknowledged as being fully implemented. There is a need to obtain the lowest cost for travel, and this has been emphasized more specifically in the procedure manuals that government has developed. The recommendation for getting the lowest cost has been there for many years, and we've specifically encouraged things like booking flights earlier. Booking back a week, two weeks, can have savings associated with it. We even encourage excursion fares, which means staying over a Saturday night, where that's a cost-effective option for a traveller and where it's something that the traveller can do.

[1225]

[ Page 1125 ]

In terms of alternatives to travel, we are encouraging videoconferencing and teleconferencing where they're a viable option to physical travel. We've had some success there with videoconferencing and also with monitoring the Internet for either fare discounts or opportunities to have an alternative to travel. We recently had the situation where Joe Clark's interview was presented through the Internet. So possibly, in the future, that type of vehicle may present opportunities for savings for government.

Recommendation No. 7 is to review meal costs and compare these to the reimbursement rates that are provided. This is agreed as implemented, and PSERC will continue to review meal allowances for all employee groups for reasonableness vis-à-vis the market.

Recommendation No. 8: "Remove meal/mileage rates as a bargaining item; review whether multiple meal rates and the kilometric rate are at an appropriate level." This is noted as partly implemented. It may well be that the unions will not agree to having the rates removed from items which are bargained. We found that the provincial kilometric rate is generally in line with other government jurisdictions, and multiple meal rates, of which we have four, will be reviewed by the Public Service Employee Relations Commission, along with the office of the comptroller general and ministries. We'll try to simplify that process. Recommended changes out of that exercise are to be approved by Treasury Board.

Recommendation No. 9: "Continue to promote the use of the corporate travel card." This is fully implemented, and we've got some current numbers here for you. The last time this came up before your committee, the number of government travellers carrying the Amex card was at about 5,700 in April of 1997, and as of the end of September 1999 we have 8,500 carrying the card, which is an increase of about 47 percent. So we've tried to get the card into as many hands as we can.

The travel advance usage is now greatly reduced, although it's not totally eliminated. I've got some recent numbers. Back in 1989, when we first started experimenting with travel cards, we were experiencing anywhere from $2 million to $4 million in temporary advances, and standing advances had been issued to employees. I'm happy to report today that as of the end of September, temporary advances outstanding were down to $86,300, and standing advances were down to $3,300. So it's markedly down from what it was ten years ago.

Collective agreements also support the American Express card usage, so this is something else that has come along since the committee last discussed that. That has helped us to roll it out and get increased numbers of users, as we see. There are still a few cases where people are not carrying the American Express card. It might be that if an employee is only ever going to have one trip in their working career -- if that's all they expect -- or they're a very short-term employee, then there's a few cases where we don't insist that they take the American Express card.

[1230]

The last recommendation, No. 11, was to develop a governmentwide policy on videoconferencing and to promote its use. This is agreed as fully implemented. There are a number of videoconferencing sites scattered around the province that are available to the government. The use of videoconferencing is growing. Several ministries have their own sites. At the fiscal '98-99 an estimate was prepared in terms of the savings that had been realized already, and it was $440,000 at that time, as a result of videoconferencing implementation. The general management operating policy of government relevant to videoconferencing is to be submitted soon to Treasury Board for approval. It's in draft stage right now and should be officially approved soon.

Recent developments. We just wanted to bring the committee up to date on some discussions that had been had relevant to travel savings. The Purchasing Commission met recently with both of the major airlines to discuss what kind of discount structure might be available to government. Both carriers indicated that to really give any kind of serious discount, each would want about 80 percent assurance of the government business. They would want 80 percent of government business to talk seriously about discounts.

This designation of 80 percent to any one carrier obviously would have -- or could have -- some regional impacts in communities where two carriers are currently flying in. If we say we're going to give all the government business to carrier X, the other carrier may decide it can't service that community anymore and pull out. An example of that sort of thing was in Prince Rupert recently, where I think Air Canada said that they couldn't service that. That wasn't because of government business, but that's the kind of thing that could happen if we gave all of our business to one carrier over the other.

Both carriers indicated when we spoke with them that we would need to consolidate government business down to about two to four travel agencies. So we've got that issue again. If we're going to get any kind of significant savings,

[ Page 1126 ]

We're obviously waiting for the results of the proposed merger between the airlines to see what opportunities that presents to us. There are also minimal rebates available from travel agents now. Health had reported previously on their experience with a travel agency of record. We believe that that type of saving is not really available anymore, because since then, I think there have been two reductions in the commissions that are paid to these travel agencies. Just this morning on the news, WestJet also announced that they are reducing their commissions paid to travel agencies; it's coming down from 9 percent to 5 percent. So there's going to be pressure there, and travel agents are going to be looking for service fees again because the commission structure is less.

Next steps. We will be working with the Public Service Employee Relations Commission and ministries to see if there is any opportunity to consolidate multiple-meal rates and to reduce the need for receipts, which are time-consuming to administer. Second, we want to continue to expand the use of the business travel account to collect airline travel information and consolidate payments -- those have both been found to be effective and cost-savers -- and also to expand the usage of the electronic travel voucher if the pilot program is successful. We've just recently started a pilot program with an electronic travel voucher, which may be routed from the traveller to various approving authorities. It's not paper-dependent anymore. Finally, to follow up with airlines after any consolidation to see what savings might be available to government.

Mr. Chairman, that's the end of our presentation.

[1235]

S. Orcherton: There's a couple of areas I'd like to ask a few questions about. The first one is around the monitoring process you've got for airline purchases. I know there are some ministries that have entered into relationships with travel agents. I also know that in those ministries that have entered into a one-off relationship with a travel agent, oftentimes there are different costs for the same flight on the same day with the same amount of notice. So the first question is, since you are monitoring it: does that mean you're just looking at the expenses? Or are you monitoring in the sense of getting the best value from the travel agents you're involved with?

I know from personal experience that if you get on a plane, particularly one that goes any distance, and you want to raise an interesting discussion on board the plane to help waste time, just raise the issue about how much you paid for your plane ticket. You'll quickly discover that everybody on the plane has paid a different amount for that ticket. My question really is around the monitoring. It's one thing to monitor the expenses, which is good, but I'd be hopeful that you'd be monitoring for consistency in terms of the costs for different plane flights. Is that the case? Where are you in that? I know it's a difficult question because, like I say, you can get on any airline, ask that question and get a variety of different answers.

D. Collisson: Perhaps I can answer the question. I'm Dave Collisson, with the Purchasing Commission.

The prime focus of our monitoring process is around the payments to the airlines themselves. We feel that the policy and procedures that are in place, place the onus on the traveller and the ministries for which that individual would work in terms of the actual monitoring of the effectiveness of their travel arrangements. One unfortunate aspect of the travel pattern of government employees is that it's very often last-minute. As a result, you are paying that premium fare. The guidelines that we do have in place stress the need for prebooking when it's known in advance that you can get better fares if you're booking two weeks in advance or whatever and, as Ron has mentioned, also for taking into consideration the fact that if you can stay over on a Saturday night on some of these longer trips, then you can have significantly reduced fares.

S. Orcherton: I'm aware of situations in at least one ministry in government where some individuals have booked a flight to Prince George through the designated travel agent. They did everything according to the rules in terms of the ministry, and away they went. But they also took it upon themselves -- being somewhat fiscally prudent, I guess -- to call up a few other travel agents to see what competitive rates were. They were markedly different, with huge savings available to that ministry had they not been locked into an arrangement with this specified travel agent.

Are we looking at that kind of situation? I mean, is there some. . . ? In those relationships, if we're moving to one travel agent for all of government -- which I'm not necessarily sure I'm supportive of, given that a lot of local communities rely on travel agents and those kinds of things to help foster their local economic situations. . . . If we move into that kind of situation where one ministry is designated with a travel agent, how do we make sure that they're being competitive? They're locked in. Have you given any thought to any kind of safeguards that could be put in place around that kind of question?

D. Collisson: I think what we have within our preferred travel agency agreement with the individual travel agencies is that their objective, when they are booking a fare, is to find the most cost-effective travel option for the traveller. When there are situations where it is brought to the attention of management or of ourselves that there is a violation of that term and agreement within our contract, then we will go back to that agency and communicate with them in terms of the inappropriate nature of their activities. Beyond that, we rest upon the information that we get back from our travellers as to how effective these travel agencies are, and we have to deal with them on that basis.

[1240]

D. Collisson: Not to my knowledge.

[ Page 1127 ]

D. Collisson: There are people who are involved in managing the activities as far as travel is concerned within individual ministries. They meet on a regular basis to discuss these types of issues. As I indicated, where it's brought to our attention through the efforts of individual travellers, as they feel they are not getting the appropriate rate, then we will follow up and deal with the travel agency.

S. Orcherton: Do we know what the overall travel cost for government is?

D. Collisson: As Arn mentioned earlier, I believe it's about $55.8 million in total. Now, that includes all elements of travel. We estimate that the air carrier portion of it is somewhere between $15 million and $20 million at this point in time, probably at the low end of that. Statistics that we have for the last calendar year, as far as the business travel count process is. . . . The amount that's billed through that process is about $8.9 million, but that only covers a portion of the travel. There is some that is not tracked through that. So we're estimating totally between $15 million and $20 million.

S. Orcherton: Okay. A final question on that particular issue is: if we move to a systemwide travel agent system -- and I said I've got some concerns about that. . . . But if we move in that direction, how could we safeguard that we're getting the right price? I mean, if you're advocating that we move in that direction, is there a way to do that? Or are we just going to have to rely on the good business ethics of travel agents to perform?

D. Collisson: I guess I would like to say that there is a way to do it, and that would be to apply more resources to this particular activity. Unfortunately, we are somewhat resource-constrained in relation to that. But we have to rely upon information that is fed back to us from the travellers. As I said, we follow up with those situations that we find are inappropriate.

Regarding your comment about the single travel agency of record, I would concur with your observation that it's probably not a good thing to do. We are working to try and ensure that there is an equitable distribution of the travel dollars, if we possibly can. We are now being constrained by the efforts of the airlines to reduce their cost structures. As they squeeze down the commission rate and the commission caps that they're prepared to pay, then we get the force-back from the travel agencies themselves. We are now looking at how we can deal with this current announcement that both Air Canada and Canadian Airlines and the other carriers are making with respect to that.

S. Orcherton: I think Arn had a comment, and I've got another question on a different issue as well.

R. Thorpe (Chair): Well, maybe we'll let somebody else go for a bit. Arn?

A. van Iersel: I just want to add to the answer with regard to how one might possibly safeguard any firm that chooses to go with one preferred supplier. It is done in various places in the industry. The most common way to ensure that you get effective use of that arrangement is to have a very strong contract which talks about the contractual requirement to provide the lowest-cost fare. That has to be well laid out. The way you enforce it is through an audit program, where you sample the fares you're quoted, check those with an independent source and feed that back to your contractor. That results in the refunding of the difference and, depending on the wording of your contract, perhaps even a penalty in terms of the air costs.

R. Thorpe (Chair): What jurisdictions are doing that, Arn? Do we know?

A. van Iersel: I don't know of any public sector jurisdictions that are doing that. The ones I'm referring to are more in the private sector.

R. Thorpe (Chair): Have we checked to see if other provincial jurisdictions are doing it?

A. van Iersel: Not recently.

R. Thorpe (Chair): Could we check?

A. van Iersel: Certainly.

R. Thorpe (Chair): Thank you.

S. Orcherton: There's just one other area I want to look at. I'm encouraged that on your last page you say that you're going to work with PSERC and the ministries to try to consolidate the multiple meal rates. I'm sure this is a helpful document for people who are travelling on government business, but how on earth did we ever get to a situation where. . . ? As of April 1, 1999, if you're in employee group I, your breakfast is valued at $8.75. If you're in employee group II, somehow you eat more, and you're allowed to have $21.75. In employee group III, it's $22.50, but there are some caveats here. How on earth did we ever get to a system like that? It kind of boggles my imagination. I mean, breakfast is breakfast. Whatever employee group I'm in, scrambled eggs and bacon are. . . . That's the cost, and that's it -- right?

[1245]

W. Scale: Yeah. I'm looking forward to answering that question, actually.

S. Orcherton: And which group are you in?

W. Scale: I try not to claim my meals.

The long-term institutional memory on this is a little weak. This goes back a long way. I think probably what happened originally. . . . This is exactly the argument made at the bargaining table, which we face continuously. We too are obviously going to be looking at this thing with the ministries and with the office of the comptroller general to

[ Page 1128 ]

S. Orcherton: Okay. I just have one final point. I don't want to belabour this. It's kind of bizarre, to say the least. I've never been one to advocate getting rid of a first-class reimbursement system but rather to get rid of the second- and third-class reimbursement systems so that everybody travels in an appropriate way. You're saying that you're going to try to consolidate the multiple meal programs. It may be better to say that you are going to consolidate them and take whatever steps are necessary. I mean, there's got to be a balance in here that makes some sense in relation to these kinds of questions.

W. Scale: Well, I think we have to look at the whole thing, though. It isn't as simple as just saying that they'll all be consolidated. Obviously these are in the collective agreements, and they have other provisions that the managers don't have. If we just move up the meal rates for the union, and they still have other benefits in their collective agreement that are beyond the management group, then I think you may be facing some increased costs. So I think you've got to look at other variables as well.

S. Orcherton: Don't get me incorrect. What I was saying on the first-class versus second-class and third-class systems was that we should really have a system that compensates people appropriately when they're travelling at government expense. It shouldn't be a second-class system or a third-class system. It should be first class -- not necessarily defining first class as these numbers here do, but put in place a system that's appropriate and that delivers what people need when they're travelling on government business. It doesn't put them out of pocket. Clearly we've got a three-tiered structure here. You're making reference to collective agreements. I would suspect that those folks are all in category I.

W. Scale: That's right.

S. Orcherton: I don't want to be too confrontational here, but it's a little bit of a weak argument in terms of trying to find a solution.

W. Scale: I would add. . . .

S. Orcherton: I don't think that category I drove the increases in categories II and III to make II and III markedly different from category I. Anyway, I hope that over the course of the next little while, you can actually achieve some solutions to this. This is just totally ludicrous. I mean, having different rates for folks on government business for breakfast, lunch and dinner just doesn't make any sense at all.

W. Scale: Yeah, other than for the. . . .

S. Orcherton: I'll leave it at that.

G. Farrell-Collins: I don't want to belabour it either, but I do think there's probably a lot of history that went into this card and probably years around the bargaining table. You might want to flip the card over, Steve, and look at hotels and why it is that group I are allowed to have $115 for hotels and motels and group II. . . . I mean, they're all different too. There's a whole range of items there. Some of them -- groups II and III -- are not applicable: porterage, ordering telephone calls, etc. It would be really interesting for somebody to, say, go through this and find out how it all ended up the way it is, but I'm not sure that we can do that right here.

I have a couple of questions. I think the line of questioning that Mr. Orcherton had regarding verifying and auditing whether or not we're getting best rates for these agencies of record is a very, very good one. Once somebody has signed that contract to essentially have a monopoly on the ministry's travel, all of the incentives to do the hard work of sitting on the phone or on the computer trying to find the best rate disappear. You know that if that person isn't terribly happy and nobody's paying attention, they're not going to know. They're not going to know whether they're getting the best rate, because all of a sudden that competition's gone. Whereas if people are booking on their own, people are perhaps going to be a little more diligent in moving to a different travel agent if they're not receiving what they think is the best rate.

[1250]

You mentioned that if you received a report of an inappropriate charge or a less-than-low fare being charged to a staff person, that's something that would be followed up. Have you had any of those complaints? Have there been any that you recall?

D. Collisson: There have certainly been observations made to us with respect to charges that have been applied by travel agencies for services that they have performed. The basis for our agreement is that for their commission fee, they provide a list of "free services." Beyond that, if there are special things that they do on behalf of a traveller, then they're allowed to charge. So there certainly have been a number of situations where we have gone back to the travel agency on those charges and asked them to reverse them, and that has been successful. I don't know myself whether or not we have had any specific observations on actual travel fares and in terms of complaints.

[ Page 1129 ]

I have a couple of other questions. Around the time of the last round of airline bailouts, when Canadian Airlines was on the verge of shutting down and both the federal and provincial governments stepped to the table with help, the Premier at that time announced that it would from thereon be government policy that civil servants and everybody was to travel on Canadian Airlines. I recall that announcement. It was one of many announcements, but I recall that one. I'm wondering if there was anything done about that. I'm not advocating that necessarily; I'm just wondering what the follow-up was. Was there any change in policy, or was that merely an announcement?

D. Collisson: To the best of my knowledge, it was an announcement that was made. There was a desire that where rates were competitive, Canadian would be the preferred carrier. Just for your information, in the statistic that I mentioned earlier about the BTA statistics that we have, out of the $8.9 million, Canadian Airlines had approximately $5.4 million and Air Canada had about $2.5 million. So there was some sort of differential, I guess, between that. I think we also have to recognize that in British Columbia, Canadian has been providing a lot of regional carrier service, perhaps more so than Air Canada in some cases.

G. Farrell-Collins: Yeah, thanks. I was just curious whether there was anything beyond the TV clip and the announcement that was made at the height of the public furore over the issue or whether that was just it. I guess the answer is there.

I have a question on the mileage that's charged when individuals use their own vehicles. I see it has moved up marginally over the years. I think when I was elected, it was 37 cents, and now it's 39 cents -- soon to be 40 cents -- per kilometre. How does that rate with other jurisdictions provincially and the federal government?

W. Scale: It's not too bad, actually. The BCAA publishes average rates for what they think it costs across the country. The rate for B.C. is 41.5 cents per kilometre to operate your own vehicle and that kind of stuff. So I think we're in the ballpark. We're lower than some of the other governments; I'm sure I have that right in front of me. But we do try and keep it in line with what BCAA recommends for different areas of the country.

G. Farrell-Collins: So that's what is used -- a BCAA guide -- as a guideline, anyway?

W. Scale: It is a guideline in terms of reasonableness, but it's a bargaining thing to some extent as well. So we try and keep it within those kinds of parameters and use those arguments.

G. Farrell-Collins: Would we be in the mid-range for other provinces and the federal government or at the high end -- or the low end?

W. Scale: I think we'd be in the mid-range.

[1255]

I have one other question. On the page -- they're not numbered on your slides, but it's the very last page -- the first bullet item said that one of the next steps was to "Work with PSERC and ministries to try to consolidate multiple meal rates and reduce the need for receipts which are time-consuming to administer." We went around this with our MLAs' travel at the time of our Citizens' Panel, where part of our business travel is done on a per-meal, per-kilometre type of process. Yet our time in Victoria is strictly per diem. One per diem -- that's it.

The discussion at that time was that the per diems actually were probably more cost-effective for government than the actual and reasonable way the business trips were done. Has there been research done on that? Obviously, if you're headed in that direction, there must be some reason for thinking that it's cheaper to just do one dollar figure and forget the processing and receipts, etc.

R. Tannhauser: Yes. One of the pushes behind eliminating receipts is that we're trying to get going with electronic forms. So right now what we've got is an electronic form which has been developed that we can fill out on a computer screen and route from the traveller to the approver to the final processor. But then we've got this passel of receipts, and what do you do with that? So right now we're sticking them in an envelope and shooting them along kind of through the mail. It's not great. There are a number of reimbursement items which group II does not require receipts for and that group I does require receipts for. That's kind of the thrust of this: is there something we can do to kind of get group I into the same circumstance as group II, where those receipts aren't required?

G. Farrell-Collins: Are the administrative savings and the efficiency savings gained by using electronic and not tracking receipts over. . . ? Are they of more value to us than ensuring that there's no loss through inappropriate claims or inaccurate claims?

R. Tannhauser: I would suggest it's a bit early in the venture to sort of provide an answer to that. We have yet to cost out the savings through the electronic voucher. We've done some preliminary work. But that's why we are in a pilot phase right now. We're just trying it out to see how it works and what savings there are.

W. Scale: That's a good question, because one of the things in bargaining unit. . . . I think it's going to require a close look. You know, there are issues where we require receipts from people and employees. Telephone calls was one of the examples. But when we started to get some information on what the actual cost of telephone calls are, it appeared that a lot of people didn't make telephone calls. So if there was no receipt required, and everybody claimed the telephone calls, we're starting to cost that. So it might have been some administrative savings, but it could have cost us a lot more money from a collective agreement point of view. So those are the types of things that I think we have to consider when we're looking at those things.

[ Page 1130 ]

Arn, did you want to make a comment?

A. van Iersel: Chair, I wasn't going to answer that. . . .

R. Thorpe (Chair): Don't forget, we want one set of rules for everybody. That's what my friend Mr. Orcherton said.

A. van Iersel: I will endeavour to take it up with Lloyd Munro, the head of revenue division. I just want to elaborate a little bit on what has been said. We are trying to take the labour-intensiveness out of the review process and focus on the major items. When we talk about going receiptless, we're not talking about major receipts for hotels, motels and the like; we're talking about the more minor receipts related to parking, minor taxi fares and the like. But that isn't enough. We recognize the risk that I think the members are speaking to now. Part of going in that direction is, again, that the system has to have an audit program in there which selects certain travellers based on historical patterns and so forth, to make sure that, as Wayne has said, we're not capturing some administrative savings while other costs are going through the roof. So we shared that.

One other clarification, if I could, because it didn't get clarified before. . . . I take the point on the differences between groups I, II and III. We recently went to Treasury Board, and Treasury Board agreed that we should move in that direction. They've asked PSERC to do that, in terms of considering the options and so forth, and we're working on it together. But when it comes to motels and hotels, there's only so much space on this card, and their rates are not different. We've just had to squeeze in, because there's a seasonal variation for all the hotels and motels. So those apply. . .

I am correct, Ron?

[1300]

A. van Iersel: . . .to everyone.

R. Tannhauser: So if you drew a big black line there after child care expenses, that's the end for groups I, II, III. Then those hotel rates vary geographically, and the same rates apply to all the groups.

G. Farrell-Collins: I just thought maybe it was really good to be in group III, because you got to spend more time in Whistler.

R. Thorpe (Chair): Gary, do you have more questions?

G. Farrell-Collins: Yes, I want to follow up a little bit on what Arn said, which is that there are obviously some historical patterns re telephone calls, taxi fares, etc. I know Revenue Canada does it this way. I don't know if the revenue division here does it this way, but if you file your tax return and you start poking up or down out of that standard deviation, that's when they start to look at you. I would assume that that's what you're talking about, Arn -- the pattern. If somebody is submitting, you know, a ton of taxi receipts and can't come up with a good explanation why, then they might be put on a different program.

J. Weisgerber: I have a couple of areas of ongoing interest. The one is frequent flyer points. I wonder, in your negotiations with the major airlines, whether this issue came up again. It seems to me that airline points represent a huge value to travellers. Government travellers essentially pay the same rate as other travellers do, and I wonder, first of all, whether the issue of a discounted rate because government employees don't collect airline points was pursued in negotiations. Secondly, I wonder who is driving this policy with respect to government employees and airline points. It seems to me that if you're not going to get a discount for not collecting them, then there must be a better mechanism that would allow points to be pooled, to be collected in an account that's designated as a non-personal account so that people could use those points for travel or finally, as we've been promoting for some time, to be pooled for something like health care travel.

R. Tannhauser: I'll start with that, and maybe my colleagues will have something to add. Just to clarify the current policy of government, government travellers are permitted to collect travel points. The requirement is that they only use them for future government travel, so they're not to be converted for any personal business or trips after. That's that part.

In terms of pooling of points, the airlines are strongly opposed to this and will not cooperate in any way. Basically, their view is that bonus points are a reward for frequent travellers and customer loyalty, and they're not to be pooled to help a business or the government to save money on their travel. They're adamantly opposed to any pooling. We've made overtures in the past and just been flatly refused.

J. Weisgerber: Just if I could, before we get off that topic. . . . It seems to me that when I travel -- and I travel probably as much as most people, or as much as the average person does. . . .When I'm on an airplane in a community that I'm familiar with, it seems to me that half of the people or more on the average flight are travelling on a taxpayer-funded ticket, whether it be through some municipal health board, the provincial government or a federal government board. I don't understand why we're so timid with these airlines. If indeed the designation of a preferred carrier could take a competing carrier out of the community, how is it that they simply say to us: "Look, we're not going to cooperate with you on this travel point thing"?

D. Collisson: I'll attempt to comment on it. We have attempted to communicate with them, from the minister to the CEOs of the major carriers, in an attempt to get them to recognize what we bring to the table when we talk about our travel stuff. Unfortunately, $10-15 million, or whatever the number is, is not significant in relation to their total travel pattern. They have refused to put any effort towards the pooling concept and are adamant that it is an individual item and that it has to be maintained on that level.

[ Page 1131 ]

[1305]

R. Thorpe (Chair): They just don't want to record the liability. That's why they're not placing a value on it.

R. Tannhauser: The member also raised the issue of points available to support health care, and I'd just like to comment briefly on that. We have made overtures to both airlines recently, seeking assistance from them to make more seats available for health-care-related travel from remote communities to where health care provision is required. We haven't heard back from them yet, but we have written letters at the ministerial level seeking their cooperation and asking them, if they don't want to support the pooling of points, what counteroffer they would give us.

J. Weisgerber: I appreciate the answer, and I would encourage government to take a bit stronger stand with these folks. Just to close this off, if we have to designate a preferred carrier, if we have to say, at the end of the day, that we are going to select one of the two carriers on that criteria, I believe that it would be a huge benefit to government.

On the issue of consolidated travel agencies, are the airlines saying that you must deal with a specific agent, or would a franchise group of agents -- for example, Uniglobe -- fill the requirement of a consolidated travel agency? It seems to me that there are two or three big chains of travel agencies that are represented in most communities. If that were the only requirement, that might soften the resistance to a consolidated travel agent.

D. Collisson: The answer to your question is yes. They have indicated that when we talk in the summary about three to four, that could be three or four groups. What they are concerned about is the number of linkages that they have to provide between their systems and the travel agency systems. So a Ryder or a Marlin or something that has affiliates around the province. . . . They all kind of consolidate together, and there would be one linkage between that and the carrier. So that's what we're talking about here.

R. Thorpe (Chair): It's quite interesting that the airlines want to squeeze everybody, but they're not prepared to deliver anything to the table.

E. Gillespie (Deputy Chair): I'll just start by congratulating my colleague for continuing to press on this, because I think it's something really important. It's important to keep making the point with the airlines about how important it is to government.

I want to ask a question about value for money, and I don't think I've ever been more aware than I have been in doing this work that time is money. I want to hear from you about the kinds of policies you have in place to ensure that both the time and the money spent in travel are spent to best use and that you're not sacrificing time for money or money for time unnecessarily.

R. Tannhauser: Yes, I can start with that. The policy we have in place for that is that the government employee authorizing the trip -- what we would call a manager or a spending authority. . . . Their role is to work with the traveller to ensure that all of the least-cost options have been followed through on. Depending on the value of the traveller's time from a monetary perspective. . . . That might determine what's the most cost-effective option, and that brings in questions of whether it's cost-effective to fly Helijet or not. So it depends on the overall cost of the package. Yes, it is our policy to look at all aspects of cost. If overtime is going to be incurred because we've chosen to drive a vehicle to Prince George as opposed to flying, that's in the mix.

[1310]

A Voice: Squished -- yeah.

R. Kasper: How much utilization is there of electronic ticketing by government? Instead of going through agents, you just use your own computers.

D. Collisson: I would have to say that right now the usage is limited. There are some technical restrictions in that not everybody who is travelling may have access to the Internet and the information that's required. There is also a great degree of complexity around attempting to ensure that you are getting your best value in these types of situations.

On a personal note, one of my office companions took it upon himself to try and arrange travel to Italy. He spent a significant amount of time going through the various carriers' systems and attempting to identify all of the coding that was required in order to identify what the best options were. Once he had that, he then took it to the travel agency. It was able to be accomplished fairly quickly, but it was just the degree of complexity around that. The individual in question is very technically proficient and was able to manage that part of the process. I think that there would need to be some significant training for individuals if that were to be the case.

I do believe, personally, that that's where we're going. I think that the airlines are definitely attempting to squeeze as much as they can out of the commissions and out of the travel agency relationships that they currently have. It will be something that we will have to continue to look at over the next few years.

R. Kasper: The reason I ask is because. . . . I think it's Canadian Airlines. They say that if you have a card -- right? -- to collect points. . . . If you utilize the electronic method, bonus points are given. So there is an incentive. If

[ Page 1132 ]

Interjection.

R. Kasper: Is it yes or no. . . ?

A Voice: Nobody knows.

R. Kasper: . . .or nobody knows?

D. Collisson: I know I don't.

R. Kasper: Okay. Well, you don't. But it's almost. . . . You know, it's handed to you. But would you look at it with that in mind? You seem to stress strongly in this documentation that collecting travel points is permitted, and you use it for government business. I'm not saying this to advocate we not deal with local travel agents, but there is a way to squeeze a little more out of the airlines. At the same time, we have to look to individual judgment. Are they going to shop around for the best possible cost for a flight, or are they going to utilize what's the most convenient, based on the time, location and shortness of time and when they have to travel?

D. Collisson: I certainly think -- I hope -- that the individuals who are travelling are making the best effort to find the most cost-effective solution. I can't guarantee that. I think it's up to the integrity of each individual to examine those travel options and to make the best-informed decision.

[1315]

R. Thorpe (Chair): If I could make a comment: remember, when you book and you get 500 extra points for doing it electronically, they've squeezed the travel agent out. So I don't know -- again back to Ron -- how they say there's no value attached to those points, because they're not paying the commission. It's 500 points if you book your own, and they squeeze the travel agent out.

One question. Pardon my ignorance on this, but do government employees get to collect and keep travel points?

R. Tannhauser: Yes. We have not actively promoted it, in that sense, but the policy permits regular travellers in government to collect points on the provision that they use them only for future government business travel needs.

G. Farrell-Collins: How many government trips in a year are done on points?

R. Tannhauser: I have no information on that.

G. Farrell-Collins: If employees are permitted to collect the points and under policy are able to remit those points for government travel, do we have any idea how many trips are being made on points? Is there any tracking system at all? It would seem to me that those would be trips. There would obviously be a per diem for their meals, etc., but there obviously wouldn't be a claim for airfare. It would seem to me it would be a pretty easy thing to find out how many trips are being done where there's no claim for airfare or mileage. It seems to me that would be a blank on the form. I'm curious about that, because that would indicate to us how well that policy is being followed.

R. Tannhauser: Sure. Generally, on a travel reimbursement requisition, the airline is pretty much always blank, because it's billed separately through the business travel account. So if we explicitly set out to track that manually, it could be done. There's no automated tracking system in terms of how many trips are made on points, but if we asked the ministries to keep a manual record, that could be done.

G. Farrell-Collins: I would think it would be something. . . . If you've got a policy, I think it makes sense to see whether or not it's being followed. Otherwise, you might as well get rid of the policy, because then you just make people. . . . It's a looming problem for people, because nobody is following it. Everybody's doing something else, but the policy is there as a sword of Damocles over their heads. If it's not being followed, not being audited, not being enforced, then, I think, you're sort of leaving people in a difficult spot where they're tempted to perhaps use them for personal reasons. I think that's something you might want to watch for.

R. Tannhauser: Okay. Thank you.

G. Farrell-Collins: I want to come back, very briefly, to the issue with the airlines. I think that Jack -- and I know Richard Neufeld also. . . . The two of them have been the ones really pushing this for years, and that is using those travel points to help people who all of a sudden have a member of their family get ill. Either that individual or a spouse or whatever has to fly down to Vancouver -- that's usually where people end up -- to get health care, and the costs are astronomical. Not everybody has relatives in Vancouver they can stay with, so there are hotel costs, travel costs, etc. It would seem to me that the program they're arguing in favour of is one that would be of real benefit to the people of this province, particularly in the regional areas.

If the province went out and said, "We are willing to grant a designated carrier licence for a period of two or three years to an airline, so here are the criteria and let's see the bid," it would seem to me that one of the components of that could be: "We're not going to be collecting travel points, so we're not going to expect travel points to be granted from the airline. Come back with the lowest price." With that you would solve the problem of whether or not they count them on their books and book them as liabilities or not. That's something they have to deal with, because now you're competing on price. It would seem to me that

[ Page 1133 ]

Second, it would seem to me that other provinces in Canada must be facing the same thing. I bet if you went and talked to the four maritime provinces, they don't even get to talk to the CEO of the airlines, just because they're that much smaller and have less clout. It would seem to me that if British Columbia and Alberta got together -- or if British Columbia, Alberta and Saskatchewan got together, and Manitoba -- and started sitting down together and said, "Let's put all our cookies in one pile here and start using our clout," you might have a far more sympathetic ear. I'm wondering if there has been any discussion with other provinces to try and crack this nut.

R. Tannhauser: Not that we're aware of, in terms of interprovincial cooperation.

G. Farrell-Collins: It would just seem to me that if Alberta and British Columbia got together and jointly offered a similar bid -- they don't have to do it together, but if they both agreed that we're going to do this, and we're going to stick to it -- the airlines would be far more responsive. So there might be some benefit to the province by trying to help solve the problem right across the country.

[1320]

G. Farrell-Collins: Maybe you'd find them far more responsive.

R. Tannhauser: Thank you for the suggestion.

P. Calendino: I guess we're getting into some details of how best we can do business. Sometimes we forget to look at the other side of the ledger and at how it would affect the airlines and whether they would be in business if we received all the benefits we want. But nevertheless, I think that there is a perception out there in the public that whenever a private enterprise deals with government, they don't find much resistance in getting their way. That preoccupies me, and I concur with Gary and Steve and Jack there that perhaps a little more tenacity should be used on the side of the negotiations on the part of the government.

I was intrigued by the comment you made about the one techie that went through all the various loops in the computer to find the best way. I can give you an example myself. I didn't do it myself; my agent did it for me because I demanded it. I had to travel last year, and I asked for the ticket to my destination. It came out to an exorbitant amount, so I inquired. I asked the agent to look at all the possibilities, even rerouting to a different city to get there. I got a price which was 50 percent less than the first ticket. I think that can be done by the agents all the time, because on the same flight -- the same plane -- I could get a 50 percent reduction.

Now, Steve was wondering why there are different prices on the same plane. It's because every seat has got a different classification, and every seat has a different price. The agent can, I think, find a similar classification of the same seats on the same flight and obtain the best price possible, but they have to want to do that. I guess the direction is that the government employees should be demanding that they look at all classifications and the lowest classification.

My other item -- and we've been talking about this for about three years -- is Helijet. All of us use the Helijet back and forth on a daily basis, almost.

A Voice: No, no.

P. Calendino: Well, except those who live in Victoria. Yet we don't seem to get any reduction unless we buy the booklet, and then we get a 5 percent reduction. At the same time, Helijet wouldn't exist if it didn't have the government business, same as West Coast Air, etc. For reasons that I don't understand, we don't seem to have an agreement with them to give a definite reduction to MLAs or to government employees when we use the service. So I guess what I'm asking for, like all the others are doing, is a little more tenacity in negotiating with them. I know that sometimes you and I don't have any choice, because we either take it or don't have the service.

D. Collisson: Well, perhaps I can comment on that. It's not for lack of trying. Earlier this year we had a discussion with Helijet staff. At that point in time they were having some difficulty achieving their flight loads, etc. Therefore they felt that perhaps there might be some mutually agreeable relationship that could be struck with government to get more people travelling. In return for that, they would of course reduce their fares slightly. They did talk to us about prebuying a huge quantity of tickets, in the neighbourhood of 1,000. However, we felt that it would be somewhat difficult for us to manage. As a result, we suggested that it perhaps would not be something we would want to pursue.

Shortly thereafter, their flight loads changed. They decided that, "Thank you very much," they were doing just fine. Therefore they didn't need any sort of relationship with government in terms of prebuying or anything of that nature. Therefore they weren't prepared to come to the table with any reductions.

So we get kind of caught. We can't force them to come to the table; we can ask them to come to the table. We can try and deal with them on a one-off basis and try and negotiate discounts. But if they say, "No, we're doing just fine, thank you very much," we can't do anything about that.

[1325]

M. Coell: I'm encouraged by recommendation 11, where you're looking at teleconferencing and the cost sav-

[ Page 1134 ]

R. Tannhauser: I'm not aware explicitly. But they did do a study into the cost savings, which I believe -- our slide indicated -- were in the range of $400,000. But I haven't personally seen the detailed numbers associated with that. I'd be willing to undertake to try and get a breakdown of that number if the member's interested.

M. Coell: I think it would be of interest for all three groups, as to how many days' travel resulted in how many days-in-lieu as time off, because basically it's an indirect cost to government. I understand the reason why if someone travels, they get time off; I'm not disagreeing with that. I'm just saying it is a cost and one that you don't often look at.

R. Thorpe (Chair): Noting the time -- Erda?

E. Walsh: On recommendation No. 2, you said that in the short term, broader use of Amex. . . . Have any kind of reviews been done on the cost of Amex compared to other companies -- Visa, Mastercard or anything like that -- and if there are any savings to be had with the usage of the others? I know that Amex isn't accepted everywhere either yet, you know, here in Canada. That's one of the questions.

The other one is. . . . I just want to make a comment on electronic ticketing. I know that with electronic ticketing it's almost impossible to get a refund if you cancel that flight -- or even keep track of it. So I'm wondering if there has been any notation made -- if there is any knowledge of how many cancelled flights on electronic ticketing you have had refunded. Or do you even know if you've had a refund on any of the electronic ticketing, because it's prepaid?

[1300]

Going back to your situation with respect to Amex, the relationship with Amex was the result of a competitive process. It was a multifaceted evaluation. Obviously the rate structure is one element of it that they charge, but it's also the other services that they provide to us in terms of the travel management information. Most of the other cards do not provide the type of information that we're looking at in relation to travel. The enRoute card was one that used to, and I believe that there's one more that is providing some information. But Amex was the best overall value for us.

R. Kasper: I'm just going to note that I've got a couple of tickets here from Helijet, and there's an $87 differential depending on the time your flight's chosen. So you can find a good rate.

D. Collisson: As Ron indicated a few minutes ago, they have set aside a few seats -- two, I believe -- on certain flights in the off-hours -- not the peak times in the mornings and the evenings, but during the mid-course of the day. As a result, you can get a slight discount on those particular seats, if you're lucky enough to get one.

R. Thorpe (Chair): I didn't even know they flew out to Sooke. There you go.

With respect to American Express, are there any air miles accrued with the American Express to government? American Express does have a very comprehensive air miles program, but not on the corporate. . . .

R. Tannhauser: No. We opted not to take that.

R. Thorpe (Chair): So there was a savings. There was a value, was there?

Seeing no other questions, did the auditor general's office have any comments to make just as we wrap this up?

G. Morfitt: No, I think things were well covered. Thank you.

R. Thorpe (Chair): Thank you very much for taking the time. Sorry about the delay from yesterday.

If the auditor general's staff is ready, would you like to start, please?

[1335]

With us at the table are Les McAdams, who you've met before, and Jane McCannell from my office. They'll be leading us through our presentation, followed by a comment from government people.

L. McAdams: Good afternoon.

This is a report about human capital in the British Columbia public service. It explores the idea of human capital and what it means to the B.C. public service. The report focuses on the role of training and development in maintaining human capital. Now, the report is divided into four chapters. The first deals with our findings for all of government, and then the following three chapters report on case studies of three ministries that we looked at in depth.

This is a very long presentation, so we're going to split it up into two. What we will deal with in the first half of the

[ Page 1135 ]

Let's start with a discussion of human capital. Recent estimates suggest that about 50 percent to 90 percent of the value created by organizations comes not from traditional physical assets but from the management of human capital. If you look at an organization like Microsoft, for example, the value is very much in the people. In the 1940s most North American jobs involved working with things, like mining ore or producing steel. By the year 2000 it's been estimated that 60 percent of jobs will be based on working with information. We estimate, at the moment, that 57 percent of the British Columbia public service is already made up of knowledge workers, so the future is already happening in that sense. In this environment, protecting and developing the knowledge and skills of public servants becomes more crucial than before. We need to understand human capital, how to manage it and how to measure it and report on it. Now, the bottom line is that human capital is a primary determinant of the success of the public service.

Opinions vary as to the definition of human capital. However, for the purposes of our audit we defined human capital as the collective knowledge, skills and experience of an organization's workers. It is the knowledge that each individual has and generates. This collective brain power includes facts acquired through formal and informal education, skills gained through training and practice, experience gained through reflection on past successes and mistakes, value judgments and social networks which are developed through relationships between co-workers, colleagues and customers. All of these characteristics, taken together, are a vital part of creating an effective and vibrant public service.

[1340]

Services are becoming increasingly knowledge-based as government moves from being a direct provider to a direction centre and funder. Also, the public service plays a key role in advising the government of the day on policy. Policy advice has to be based on a significant body of knowledge, and the judgment of public servants in delivering policy advice should have the benefit of wisdom and experience. In addition, public servants provide direction to complex activities which require high levels of technical and professional knowledge. Technology is changing rapidly in most sectors, not just in terms of computers but in terms of leaps in professional and technical knowledge. So with this pace of change, training and development is critical to maintaining the ability of ministries to provide quality service. A culture of continuous learning, which we see in successful companies in the private sector, needs to be created.

We focused this audit on the use of training and development as a key strategic management tool in maintaining and developing the human capital of the B.C. public service. We also examined whether government evaluates and reports on the results it receives from its investment in training and development.

Before we begin, a little piece of terminology. I want to distinguish between training and development. Training is intended to improve performance in the employee's current job, whereas development is grooming the employee for future responsibilities. Executive development programs would be an example of this kind of development.

We looked at both formal and informal training within the public service. We included employees of ministries but not of agencies, boards and commissions, and we did not include employees of Crown corporations. So we were essentially looking at the core ministries. There were three parts to our cross-government work.

First, we examined how well the Public Service Employee Relations Commission, or PSERC, provides corporate direction for training and development, monitors activities and then reports to the Legislative Assembly on the outcome of the activities.

Second, we conducted a governmentwide survey of a representative random sample of regular full-time employees who'd been with their current ministry for a minimum of 12 months. The survey reached approximately 3,500 workers, and we received a remarkably high response rate -- about 76 percent. This speaks to the depth of commitment of the public service workers and their interest in this particular topic.

Thirdly, we completed in-depth reviews in the Ministry of Transportation and Highways, the Ministry of Agriculture and Food, and the Ministry of Attorney General. We drew on these case studies to deepen our understanding of what we were finding from the cross-government results.

As with any audit, we needed criteria to access performance, and with the assistance of a leading consultant in the field, we developed a model for managing training and development that represents best practices in corporations and organizations across North America. We used this model for our assessment. This model views employee training as a dynamic process with four major components: planning and support, needs assessment, design and delivery, and monitoring and evaluation.

[1345]

[ Page 1136 ]

Next is the design and delivery of training and development. The objectives in this phase are to develop the learning tools and to promote and communicate the availability of training and development activities. The final phase of the model is monitoring and evaluating training and development. The objective here is to assess the actual or potential contribution of training and development to organizational or individual performance. So this model overall has the tools to ensure, or help ensure, that training contributes to effective performance and that training becomes an integral part of managing human capital.

Let's move from our criteria to our conclusion. We've concluded that the human capital of the British Columbia public service is at risk. Ministries have experienced downsizing, spending freezes on training and development and an exodus of experienced employees. There has also been considerable movement within the public service, and as a result, many employees are performing new and unfamiliar duties. These factors heighten the need for training and development.

I should also mention the demographics here. There are lots of grey beards appearing in the public service as well. We're all aging here.

R. Thorpe (Chair): Easy. . . . [Laughter.]

L. McAdams: We concluded also that the government has not managed its training dollars strategically to protect its human capital. The central problem is that decisions about training and development are being laid in the absence of a strategic plan for maintaining human capital. Instead, they seem to be made at an individual level, with no consistent criteria and, therefore, may not represent the best use of very scarce training dollars. As well, the amount of training and development being provided indicates that the British Columbia public service is not sufficiently committed to training its employees. We also concluded that this lack of commitment is underscored by the lack of proper evaluation of whether the results of training are bringing about improvements in the performance.

Finally, the Legislative Assembly does not currently receive any accountability information about training or development or about the state of human capital in the B.C. public service.

Those are the overall conclusions that we reached from the study. Now let's look at the key findings that led us to our conclusion.

R. Thorpe (Chair): Excuse me. There were three conclusions that you reached. There are only two on the slide. Is that correct?

L. McAdams: There were three slides dealing with our conclusions. . . . Sorry, there were two slides dealing with the conclusions. The comments follow the bullets pretty well, I think.

R. Thorpe (Chair): So your comment on the public service, that follows "not sufficiently committed to training and development" -- is that it?

L. McAdams: Yes.

R. Thorpe (Chair): Okay, thank you.

L. McAdams: We'll deal with the key findings now. We'll move to human capital issues facing the B.C. public service.

We found that there are a number of urgent human capital issues facing the B.C. public service and that there is no overall human resource plan in place to address them.

Over the next five years, 21 percent of the public service as a whole and 43 percent of senior managers will reach 55 or older and be eligible to retire. Ten years from now, at least 51 percent of the current workforce, including 83 percent of senior managers, will either have left or be eligible to retire. This trend will significantly increase the attrition rate due to retirement, resignation or dismissal, which is running at about 6.5 percent a year. But there's a lack of succession planning to deal with this potential exodus of employees as the workforce ages.

The government has also lost a significant amount of human capital through reorganization and downsizing. Forty percent of government employees had their jobs redefined during a one-year period from December '96 to December '97. Many of these changes were caused by reorganization. During '96-97, efforts to reduce ministry budgets resulted in many employees leaving because of voluntary severance packages, early retirement schemes or involuntary layoffs. A total of 1,697 employees left the government during that time, resulting in 31,151 years of knowledge and experience exiting the public service.

Employees assuming new positions were to receive job orientation and in-service training to help them meet job-specific requirements. However, we found that 33 percent of employees who had been in their positions for less than one year did not feel properly trained to carry out their duties. We also found that an increasingly competitive job market is making it difficult for the government to recruit and retain staff in certain functions, particularly information systems, accounting and senior management. I'm very glad to tell you about the accounting side.

[1350]

We found development of the next generation of public servants seriously lacking. Only one in five government employees had participated in any form of development in the previous 12 months, and this was a generous estimate. This 20 percent includes a broad range of development activities, everything from secondments and attendance at conferences to reviewing professional journals, visiting work-related Internet sites or looking at and listening to audio and video cassettes.

These are serious challenges facing the public service. Obviously we need training and development as part of

[ Page 1137 ]

Training and development, for the most part, is not incorporated into strategic plans within ministries, and it's not linked to improved organizational performance. Training has not been focused on areas where employees are particularly affected by changes in ministry direction or losses due to reorganization. We also found -- as an aside, I guess -- that none of the factors of gender, region of employment, occupation, industry, function, professional designation, and so on, appear to have any bearing on an employee's likelihood of receiving training or on the type of training they receive. There was no evidence of any bias or inequities based on gender or location or occupation.

A key element in developing a strategy for managing human capital is the development of an inventory of human capital. What competencies do we need? What's missing? What's deficient? We found that PSERC had started on this task. Curriculum advisory committees have been established for all common occupation groups such as finance, information technology and management. These committees have been given the task of assessing the current skill levels in the public service and determining which of the generic competencies should be training priorities for the future. However, this work needs to be rolled together into a single overall strategy. Now, these are slightly difficult to see, but if you could have a look at your handouts as well, they're there.

Another important part of a needs assessment is determining whether or not training is the right solution or whether there are other factors that may be affecting an employee's ability to perform. If there are barriers to better performance, the investment in training may be wasted. So as part of our questionnaire, we asked some questions to capture the employees' view of their working world. We found a number of barriers to improved performance. Only 58 percent of employees believe that steps and procedures required to do their job make sense; 56 percent believe that they have the tools and resources to do the job well; 49 percent believe that they get the feedback they need to do the job well; and 45 percent believe that they've achieved the recognition they deserve or need when they do the job well.

[1355]

Research has tied these factors to increased performance. In a recent global survey of more than one million employees, the Gallup organization identified 12 indicators that link employee satisfaction with positive business outcomes. Gallup found that organizations that combine employee recognition with a structured performance measurement are companies that are most likely to have engaged and satisfied employees and to be successful. Some 82 percent agreed that recognition motivates them to improve job performance.

Even without a formal needs assessment, however, it is clear that the British Columbia public service shows minimal commitment to training and development of its employees. During the year ended December 1997, 36 percent of government employees received no formal training. Employees received, on average, 17 hours of training. Only nine of those hours were job-specific. The remainder of the training was either mandatory courses for all government employees, such as occupational health and safety training or computer-related training. This is significantly lower than the 29 hours of training received by Canadian employees overall, as reported in the 1996 Conference Board of Canada survey.

J. Weisbeck: Is that per year?

L. McAdams: That's 29 hours of training per year, yeah.

Another indicator of this minimal commitment is the amount of money allocated to training and development. It is difficult to get reliable information on how much ministries spend on training. They use a variety of methods to account for employee training, and they had difficulty providing us with specific information on training expenditures. From the information we were able to obtain, we estimate that the British Columbia public service invested an amount that is slightly less than 1 percent of payroll costs on training for fiscal '96-97. This spending level is low compared to the private sector. It's estimated that U.S. companies spend an average of 1.46 percent of payroll on employee training. Fortune 500 companies spend an average of 3.2 percent, and Japanese firms approach 6 percent.

Employees told us that they see this as a lack of real commitment. Sixty percent feel that the support provided is inadequate. We found that, unlike successful companies, training is viewed as a cost rather than an investment. As a result, training is often caught up in spending freezes, which are not uncommon in government. Ministries usually interpret these freezes as applying to all training except that which is legally required, such as occupational health and safety.

This slide shows the pattern of freezes and how they affect opportunities for training. Training budgets usually survive from April to October. However, many ministries have seasonal workload patterns -- for example, agriculture, highway construction, recreation and parks management. Thus, training must largely be made available in the off-season, but since the off-season is when cuts commonly occur, training for these employees is frequently cancelled.

Training freezes also undermine the benefits of planning. Sometimes the training is linked to other operational changes, such as the introduction of a new computer sys-

[ Page 1138 ]

Out-of-province travel freezes may result in the depletion of expert knowledge. This was a key concern expressed by several government professionals. Many of these professionals work in specialized areas where only a few in Canada are involved. Examples include legislation writers, animal pathologists and earthquake engineers. For these specialists to maintain their expertise, travel outside the province or sometimes the country is required. We also found examples of northern employees having to travel to Vancouver because of out-of-province restrictions, when the training was offered in Alberta, and the travel expenses would have been less to go to Alberta.

Finally, we discussed the issue of accountability. The first part of an accountability process is the clear assignment of roles and responsibilities. PSERC has responsibilities for the overall management of training and development in the government. In practice, it has delegated much of its responsibilities to the ministries. However, it has not clearly laid out the roles and expectations of the ministries.

[1400]

Finally, we found that no report is made to the Legislative Assembly on the overall state of human capital within the British Columbia public service.

As a result of our findings, we have a number of recommendations, which we lay out in the following slides:

1. That the British Columbia government develop and implement a strategy for managing human capital, that it determine where the shortfalls and risks are and that it work to ensure that sufficient numbers of appropriately skilled employees are available. We also believe that core competencies for all government employees need to be established as the first step in developing this strategy.

2. That the British Columbia government make a commitment to the development of a culture of learning. To become a learning organization, government should use training and development as a strategic tool in managing human capital, foster a culture that encourages learning, and incorporate training and development needs into its operational plans.

3. That the Public Service Employee Relations Commission develop standards and policies for the management of human capital. Roles, responsibilities and reporting expectations with regard to human capital and training and development should be more clearly defined and performance monitored. Senior management should be clear on its responsibilities for managing human capital within the ministries.

4. That the British Columbia government determine the level of investment in training and development that is necessary to protect the collective skills and knowledge in the public service and use this as a benchmark in assessing the adequacy of investment in future years. The benchmark should be based on a needs assessment that takes into account the long-term goals of government, service quality objectives and the shift to a more knowledge-intensive public service.

5. That the British Columbia government protect resources allocated for implementing a human resource strategic plan from cutbacks during freezes in operational spending.

6. To ensure its skill base for the future, the British Columbia government should place a much stronger focus on the development of government employees, particularly in the area of management.

7. That the Public Service Employee Relations Commission should make full use of its investment in CHIPS by requiring that all training -- not just cross-government training -- be recorded in the system as a means of providing better information on the amount and type of training provided to the different occupational groups across government. In addition, ministries should have a consistent means of recording spending on training and development.

8. That ministries determine the results of training and development through systematic evaluations of activities in relation to overall ministry performance.

9. That the annual report of PSERC include an overview of human capital in the B.C. public service, including periodic evaluations of the cost-effectiveness of training and development. In addition, we recommend that ministry annual reports include information about the management of human capital.

There are the cross-government recommendations. I want to give you a preview of the ministry recommendations that we came up with. These recommendations spring from the case studies that we conducted, and they were common themes that we found within the three ministries. We found, as a result of our case studies, that there were other issues common to all the ministries, such as working environment and the management of change. As a result, we are making these additional recommendations:

1. That a formal management training and development program be developed based on identified management competencies and that all managers be provided such training.

2. That managers be accountable for the development of their staff. The focus should be on creating an environment that values employees, providing appropriate recognition and feedback, promoting training and development as an investment that's linked to the achievement of business objectives and providing quality service.

[ Page 1139 ]

4. To protect government's credibility as a contract manager and to ensure value for money, we recommend that a minimum standard of contract management training be mandatory for all employees who manage contracts.

That is our presentation on the cross-government work. We'll pause here before we go on to the case studies of the ministries and answer any questions you wish to raise at this stage.

[1405]

L. McAdams: I believe it is. From the demographics we've seen, the typical retirement age is 58 at the moment.

J. Weisbeck: Looking at the demographics of British Columbia and the aging population and realizing that people don't go brain-dead at age 65, is there any encouragement to try to keep some senior staff people on after the age of 65?

M. Nicholls: Would you like me to answer that?

J. Weisbeck: Yes, please.

M. Nicholls: There is limited ability to maintain people on employment after age 65, and that's generally by order-in-council. There are arrangements in terms of holding onto expertise, but that is also through contracting. So it's not really a continuous employment relationship.

J. Weisbeck: We spoke about spending $18 million on development costs. I'm just curious to know whether this is done in-house. Or is it done outside the institutions? I know for a fact, for example, that some of the major corporations in British Columbia find there's not enough flexibility in the institutions and colleges and universities to send their people there. Obviously time off work, etc., is a factor. So they're finding that they have to spend some time within their institutions training their own people. What happens in government?

M. Nicholls: It's a combination. Some of it is in-house training. We don't provide in-house training; PSERC doesn't. We essentially assess the needs, the corporate training. Maybe I should just back up and give you a brief description of what PSERC's role is in relation to ministry roles.

Before I do that, I'd just like to introduce the individual next to me, whose name is Faye Schmidt. She's the executive director of organizational support division in PSERC. I'd also like to introduce a gentleman who's in the audience. His name is Seoras Adams, and he's the director of the employee learning services. I have two additional people that I'd like to introduce; their names are Aman Nijjar and Pauline Mosher. They're two interns who are working with PSERC on their intern term. They thought they'd come and evaluate their deputy minister this afternoon, so be gentle.

L. McAdams: By way of answer to your question, on page 36 of the report we look at the instructional methods used for employee training in the B.C. public service: 25 percent are used in an in-house classroom setting; 42 percent used a classroom setting away from the office; 11 percent used a college, university or institute setting; 18 percent were at a conference away from the worksite; 2 percent were self-paced computerized learning; and 2 percent were videoconference.

R. Thorpe (Chair): Maureen, do you have a presentation on this first part that. . . ?

M. Nicholls: What we do have is a handout that we'd like to provide you with, which gives a response to each of the recommendations that have been made by the auditor general.

R. Thorpe (Chair): Maybe it would be more beneficial to us. . .

M. Nicholls: I think it would.

R. Thorpe (Chair): . . .if we went through that and then gathered our questions.

M. Nicholls: I'll provide two documents: that document, which is the response document, and also the business plan for the employee learning services, which is the main program area responsible for corporate training and development.

E. Gillespie (Deputy Chair): In the meantime I just want to ask a question of the auditor general's office. I'll just wait for a minute.

I was interested in your comparative numbers of number of hours spent in training across the country. You have the Canadian average as 29 hours. Can you break that out between public sector. . . ? Or is it a combination of public and private? Do you have any other numbers on public sector training?

L. McAdams: It's a combination of private and public sector.

E. Gillespie (Deputy Chair): Do you have any information on strictly public sector?

L. McAdams: I don't believe that the data got broken out between the two sectors, no.

A Voice: It wasn't available.

R. Thorpe (Chair): Thank you. Maureen, perhaps you could continue -- or start -- with your presentation.

M. Nicholls: Yes, thank you. Just as an introductory point, the data that was collected for the purposes of the

[ Page 1140 ]

[1410]

Now, we are addressing them in a difficult climate, because we do have budget constraints. As the auditor general has indicated, probably the first things that disappear in a ministry budget are travel, administrative overhead and training. Often that is buried somewhere else, so that it's protected, and it isn't creamed off in the budget reductions. But there's no question those are challenges to us.

In terms of PSERC's role, the Korbin commission -- in 1993, I believe it was -- made a recommendation to establish an education development centre and that it should be established within PSERC. It was established, but Treasury Board -- I believe it was in 1996 -- made a decision to withdraw all the funding and FTEs from the employee development centre, primarily in response to a perception that the new mandate directed by Korbin had not been achieved. I'm not entirely clear on what that means, but I believe the view was that the employment development centre was seen to be providing training largely to the management of the public service. So funding was restored immediately for all the training, with the exception of management and executive programs, where no funds were provided. That continued to be in place until 1997.

In response to the funding issue, PSERC undertook a full review of its training and development function, leading to the creation of the employee learning services, which Ms. Schmidt heads up. The key directions that guided the work of the employee learning services were: a new governance structure to strengthen PSERC's ability to incorporate government's strategic and business needs into training, development, program decisions; a move to a competency-based approach, which we can talk a little bit more about; an introduction of governmentwide training needs assessment for all corporate training; and better coordination and sharing of resources across the system. Then in 1999 -- so this year -- PSERC received the first money for the launch of an executive development program, which is targeted at our senior management, generally in the ML6 to ML8 range. That was $154,000, so that's a small amount of money to try and address an executive development program.

That's some of the background that leads us to where we are today. The good news is: we can only get better. I'm serious. We can only get better, because I think there's a lot of opportunity to do some good work over the next number of years. I think it does require that there be an overall human resource strategy in the public service, and that is a priority that's on the top of the list for the deputy ministers' committee on human resources. It's an issue that I will be pursuing in my role as a commissioner.

I think there's much that the Public Service Employee Relations Commission can do to improve its support to ministries in their training and development. I think that what we're often captured by are the issues of the day -- the day-to-day operation -- and we don't often have time to step back and take a look at what our needs are going to be into the future. I think that some ministries are beginning to do some very good work in this area, and I think that in some measure as a result of the auditor general's report, this has highlighted an issue that needs more immediate attention than has been given it.

I don't know how you want to proceed. If you want to go through the recommendations one by one or if you would just like to ask questions, I'm at your discretion on that.

[1415]

M. Nicholls: Now, I must apologize. I'm seven weeks in this position. . .

R. Thorpe (Chair): An expert.

M. Nicholls: . . .so I'm going to be relying in part on my good staff. Would you like me to just proceed through the recommendations that are here? Okay.

The first recommendation that the auditor general made was to establish a strategy for managing human resource capital. You can see that the work we've done to date is that we have developed, in consultation with the ministries, core competencies for all government employees. These are general competencies. These competencies will then be expanded on for the various groupings of employees. So for senior management, for example, there'll be greater descriptions of what those core competencies require. I believe we have a copy of the core competencies that we could distribute, if you're interested in seeing them. But that essentially says: "Here are the critical qualities that we're looking for in an individual." What we don't have is any sort of consistency at the present point in time in what we need in government and, sometimes, what we recruit into government.

So the core competencies, as the auditor general indicated, were a critical aspect in ensuring that we knew what we needed and were recruiting on that basis. We have developed a strategy to manage human resource capital. As I indicated earlier, we need an overarching human resource strategy for the whole public service, and I hope that will be quickly initiated and underway.

The core competency framework for all employees, executives and managers has been developed, and I believe

[ Page 1141 ]

In terms of establishing a culture of learning, the actions we've taken to date are to develop a presentation to promote the linkage between a well-trained workforce and the achievement of business goals for delivery to ministry executive groups. We're also developing a training plan template which can be used by the ministries to roll up their assessed needs. So that's in response to the auditor general's recommendation that yes, training may occur, but it's not linked to the needed skills that have been identified as part of an overall strategic plan for the ministry. An employee learning board, which has deputy minister- and assistant deputy minister-level representation, meets on a regular basis to establish governmentwide training priorities and provides business input into governmentwide training plans and curriculum.

For example, a couple of weeks ago we just kicked off this executive development program I was talking about earlier. It's a small program; it's a modest program. It will address 15 candidates over the next year. It's a combination of a number of factors. The first factor is that there's a very rigid assessment process that individual applicants go through. Once they pass through that first phase, there is then an in-house training, training through courses and conferences.

Also, a critical part of the executive development program that needs very close work with the ministries is developmental projects or assignments of individuals so that individuals can move. If they've been in an operational area, what you want to ensure is that they have that experience in either a central operation -- finance, admin, human resources -- or, vice versa, in the field and operational -- that overall combined kind of experience. We're hopeful that the evaluation of this executive development program will lead to an expansion of that program over the next number of years.

[1420]

We've also been revising our training and development policies, and those will be distributed over the next number of months. As the auditor general indicated, there were no policies, or very limited policies, in the area of training and development. Those policies will identify and address the roles and responsibilities of the ministry, PSERC, managers and employees. So it's very clearly articulated and needs to be reinforced through mechanisms between employee learning services in the ministries.

Employee learning services also distribute quarterly reports to deputy ministers outlining ministry training activities. These reports include the number of employees attending specific course types and costs. The next report will have the number of training hours per FTE category for comparison. We do have difficulties with the collection of data with respect to training. Maybe, Faye, you could talk a little bit about what we're doing to try and address that particular issue.

F. Schmidt: With the introduction of our human resource information and payroll system that we refer to as CHIPS, there is a component piece of it -- the training admin module -- that allows us to capture training data. When we introduced that module, it was with the requirement that all training of one-half day or longer be entered into the system. We quickly discovered that we had two issues. One was a compliance issue. Entering this information became a low-priority task in many ministries.

The second issue -- a more substantive issue for us -- was that the information being entered had a number of difficulties with it -- for example, training costs. One ministry would calculate the cost of the employee's travel; the next might not. Another ministry offering a course in-house might include the cost of the salary of the employee offering the program; the next ministry might not -- and on the list would go.

We've been working hard with what we call TMAC, the training managers advisory council, to make sure that we have consistent definitions -- and we believe we now have that nailed down -- so that the data will be entered the same. By way of issuing the quarterly reports to the deputy ministers, the compliance in terms of getting the training information in has improved substantively as well.

We're on the right course. It's going to take us probably another year of collecting this information before we can come back and accurately say to you that this is what we think we're now spending in this area and where it's going.

M. Nicholls: We have also redeveloped ELS. The employee learning services has established a web site, and that's the prime source of corporate training and development information. There's a catalogue of the various courses that are available to employees, which is on the web site.

In terms of the next recommendation, which was to develop similar standards and policies for the management of human capital, I think I touched on that partially. We are in the process of revising and creating new training and development policies. We recently had a couple of policies signed by the minister, which will be issued in the very near future.

The management curriculum is currently at the request-for-proposal stage, and it addresses management development of human capital issues. This is a program that we hope to begin work on in early 2000.

Recommendation 4 is to determine the level of investment in training and development. What PSERC is currently doing in this area is annual training needs assessments, which lead to a governmentwide training plan. We intend to apply rigour to the training plan development to ensure that the plan directly addresses government, strategic direction and ministry business needs. The level of

[ Page 1142 ]

[1425]

The fifth recommendation is to protect resources allocated to human resources and cutbacks. We are also, in the submission I spoke of, proposing that there be some protection for these training dollars. As I said earlier, I think that this is becoming more and more a critical issue that needs to be addressed, and we'll wait and see the outcome of that submission.

Provide accurate reporting. PSERC is encouraging ministry compliance to the CHIPS and ministry training module to ensure the capture of all training costs. As they indicated, that will probably evolve over the next year. This information is reported quarterly to enable ministries to accurately track their spending on training. The report is distributed directly to the deputy minister to ensure compliance.

Recommendation 7: "Greater emphasis on employee development, particularly for management." As I indicated earlier, we've just kicked off an executive development program, and we've already had a great deal of interest expressed about the program. So we're quite positive that this will be a well-received initiative within government.

We've agreed to participate in the federal career assignment program, or the CAP program, and that's to commence in the fall of 2000. We will be enrolling three individuals per year in the federal development and exchange program. The ELS business plan calls for a plan for a management development program for high-potential managers, to prepare them for more senior management positions. That plan is to be prepared by March 2000. Curriculum development based on competencies is underway for supervisors, managers and senior managers. A request for information through the Purchasing Commission has been reviewed. This will be followed up by a request-for-proposal document to be issued November 5, 1999. A series of executive learning events is underway -- events coordinated between Employee Learning Services, the public service development office and IPAC.

ELS and the Ministry of Finance are currently running a pilot project to evaluate competency-based career development software, called the Career Fitness Builder, and learning plans are developed to address individual learning needs. The career development and resource centre provides counselling and career planning advice to employees as well as providing a well-stocked resource centre for general employee use.

Recommendation 8: "Evaluate training in relation to individual and organizational performance." The employee learning services business plan objective is to ensure the accountability of training by developing and applying evaluation tools and processes. Specific evaluation tools measuring transfer of learning to the workplace have been developed and distributed to ministry training units. The ELS is upgrading the skill of the government training community through seminars on performance consulting and distributed learning courseware selection. ELS project consultants are each assigned to specific ministries and consult with ministries on the application of these evaluation tools.

Did you want to add anything to that particular one, Faye?

F. Schmidt: I think that this is an important part of the audit: making sure that we can come back and demonstrate to you that we know what the value of the investment has been -- more than what we call the happy sheets or the smile sheets that you fill out when you've just finished a training program. So we have now started to follow up with employees once they're back on the worksite. What difference did the training make? What have they learned? What have they been able to apply? What was irrelevant once they got back? We need to really explore that in more depth, which is what the audit was saying we should be doing, so that we can indeed demonstrate the value.

[1430]

No. 10 is: "Develop a formal management training and development program." I think I indicated earlier that PSERC has agreed to participate in the federal career assignment program, which is to commence in the fall of the year 2000. This will enrol three learners per year in federal development and exchange programs. The ELS business plan calls for a plan for a management development program for high-potential managers to prepare them for senior management positions -- the plan to be prepared by March 2000. Curriculum development based on competencies is well underway for supervisors, managers and senior managers. A request for information has been reviewed. This will be followed by a request for proposal on November 5.

No. 11: "Managers accountable for the development of their staff." In the process of revising all of our training and development policies, as I indicated, we are setting out the responsibilities of all of the parties to the training process. That includes PSERC, ministries, supervisors, managers and employees.

[ Page 1143 ]

No. 13. "Contract management training." Two contract management courses already exist. This is the issue of ensuring that there's training for ministry employees in contract administration. We have two contract management courses that already exist. One is "Managing Government Contracts." It's for employees responsible for managing or administering contracts with service management, while "Service Management For Long-Term Contracts" is for contract managers responsible for long-term service contracts. Investigation of a broader government outsourcing programs for managers, with a significant contract management component, is also underway.

So that is the general response to each of those recommendations. I'm happy to try and answer any questions that you may have.

R. Thorpe (Chair): Thank you very much, Maureen.

J. Weisbeck: Yes, referring to that in my original question about type of education or training people are being subjected to, I was looking at page 85, talking about the various methods. I was interested to see that there's very little computerized or virtual learning. Like, in the world we live in now, with access to the Internet and computers and programs, etc., is there a movement to try to get more virtual learning into the learning aspect? There is. Are there lots of programs available for. . . ?

F. Schmidt: We're definitely moving in that trend, particularly as we look at bringing more younger people into the workforce. We were talking about this this morning. Some learners -- people my age -- quite often find that learning through a computer may not be the best way to go. I probably need a classroom or some other approach. But someone younger than me would probably appreciate and may learn their best through a computer-based program. So we're trying to encourage a lot of diversity in the kinds of learning events that we offer, so that we can meet the full spectrum of learning needs of our participants.

Courseware is now being developed at an increasing rate for computer-based learning, and we've been trying to bring that in, particularly for training of IT professionals. We do a fair bit of our training for them currently on computer-based learning applications. So it's an evolving and growing area, and we expect to see a lot more of it in the near future.

[1435]

F. Schmidt: It's both. There are a number of people that do sort of more developmental, longer-term training programs after hours. A lot of the more skill-specific training happens during hours, but there's definitely a combination of both, depending on the learner's needs and government's needs at the time.

E. Gillespie (Deputy Chair): The first thing I want to say is how pleased I am to see this audit and your response to it. I think this audit casts a light on a really important area in British Columbia -- not just in British Columbia but everywhere. As the auditor general's office has pointed out, the aging of the workforce is a very big challenge for the public service in British Columbia, as it is in every other sector. I think I heard a weekly broadcast this summer about the crisis in health care because of our aging physicians and the crisis in education because of our aging teachers and the crisis in post-secondary education. In all of those areas we're all looking at the same wall.

One of the things I'm interested in. . . . Yesterday we talked about debt management, and we talked about the ability to count our capital assets and to be able to balance them off against public debt. Here we're talking about human capital, and we're talking about having an environment where we are investing in our human capital, investing in the people who work in the public service and investing in management for the future. Is there a way of measuring that and counting that among the assets of government to, again, balance off the debt? Very clearly, you've all pointed to the freezes. What do the freezes affect first? The freezes are in response to budget crunches. But the freezes will first affect travel, training and administrative overhead.

M. Nicholls: That's right. I haven't really given much thought to how you value or evaluate the worth of human capital. But I would say that I think you look at that translation in the public services and programs that the public servants provide. If they're not providing them in an effective, responsive, service-oriented way for the public, that's a problem. I think that's probably one of our biggest challenges over the next number of years.

As I indicated earlier, there are a number of factors that sort of combine to create this as a real challenge for all ministries and PSERC to grapple with jointly -- the changing demographics, the change in the work environment. Regardless of government's philosophical base, the jobs that are going to be done are going to be done differently simply because the budget requires that to be. There's just not the funding to go around and continue with some practices that may not be the most successful practices in government.

When I say that, perhaps I could just give a couple of examples. When we talk about moving to a knowledge-worker orientation, a number of our registry functions that we have in government -- the corporate registry and similar functions like that -- were in the past quite labour-intensive in terms of manual recording and reviewing of files and functions. Not so now -- they've moved to an access base which allows the public reasonable and good access to information. Then people that are serving the public have to be informative in knowledge in terms of the information that they're providing; that's in addition to

[ Page 1144 ]

So to me it doesn't really matter what the government's philosophic base is. I think that there will be changes -- and significant changes -- in the workplace. For the individuals in the workplace, change is scary. We need to give them time and support to manage through this change. I think there are major challenges for us. I don't know if I've answered your question sufficiently in terms of how you evaluate. . . .

[1440]

So I appreciate that it's a difficult thing. But I also think that in really shedding light -- having an auditor general's report that sheds light on the challenges that are here -- it actually presents an opportunity for government to make that investment that's necessary for the training and development that have to happen.

R. Thorpe (Chair): Is that it? Mr. Coell?

M. Coell: I'd first like to say how much I appreciate this report; I think it's very timely. I agree with the thrust of it -- that if we don't act, we're going to have a crisis in the civil service. I think we need to invest in the people who invest their lives delivering services to the British Columbia taxpayer. I don't see that happening in the last ten or 20 years. I think that if we can do anything on this committee, it's to reinforce to government -- to the Premier and cabinet -- that this is an extremely important matter. I'm the critic for the Ministry of Environment; the BCGEU just had a survey of their membership there showing low morale and a lot of the things that are pointed out in this report that need to be acted on.

When you've got that number of people delivering services, and you're not training and upgrading. . . . Most of them will become career civil servants, and I think that's an honourable career to choose. You want, over a 20- or 25-year period, to have people better when they leave the system in every way than when they came in. We're certainly not doing that now. I think it's showing in this report, and I think it shows in Maureen's comments as well, that it's understood by the people in your two offices, but I'm not sure it's understood by the politicians in the Legislature. I think that where the change needs to come from is by a direction from the Legislature to the bureaucrat to the people who actually deliver services. I think that's where you're going to see the change, and until you see that change, I don't hold much hope. It has to happen. There's too much invested at this time in a lot of people to not have that next step and the next step after that, if you're going to encourage people to actually become civil servants and pursue that career. I think it's a very timely report, and it's something that we should review and have this committee review, no matter who's on it, every six months until we see some change -- and keep recommending to the government to make that change.

M. Nicholls: One of the interesting statistics -- and I can't remember the exact statistic -- is in terms of young people coming into the public service and seeing the public service as a good employer and a good opportunity to work. Approximately 21 or 22 percent of our public service is under the age of 35. That's where we're going to be drawing from in terms of this outflow that's going to hit us with the 55-and-overs. What we need to do and what I would really like to spend a lot of time and effort doing is working on programs that are going to attract young people into government.

Right now, we essentially have three programs that operate. We have a youth employment program; we have a co-op program, which has been in place for many, many years, where there are co-op terms of approximately four months. Those are, more often than not, with the University of Victoria -- MPA students and other students in master's programs. Then we have an intern program, which I believe is new this year. They're very small. We have only ten positions for interns, and our youth employment program is not a large program.

When we have statistics that indicate that we're low to begin with in terms of youth coming into government and then our retention of them is not good, there's something happening there that we need to take a close look at, to find out why young people tend to be leaving. What we have in terms of statistics are people who have been working for a long period of time, who have established a level of income and pension security, who will remain until their retirement. We're holding on to the elders, but we're not holding on in the way we should be, I would say, to the young people. That, to me, is a very critical issue that needs a fair bit of attention.

[1445]

Some years ago, we used to call people who looked after employee relations and employee development personnel officers. A few years ago we started calling them human resources officers. Today we're talking about something new called human capitalism. I think there's a problem -- and I think it's a piece of the problem -- in how we deal with staff development inside of the government. It's shifting away from individual needs to needs of the corporation, and it's now defining workers in the corporation as human capital. I think there's a problem there -- and I don't mean it to be taken flippantly -- in terms of where we are with the people who work for government and deliver the programs of government. I think, by and large, they do a great job doing that, given some of the constraints they have to work under.

I know there are problems inside of government around morale and training and opportunity. I know people are leaving government. We saw some of the statistics. There are a whole variety of reasons, some of those

[ Page 1145 ]

I want to make that comment. I think part of it is an attitudinal issue around how we deal with our employees in the various ministries inside of government.

L. McAdams: May I respond to the human capital issue, just to clarify where we came from?

S. Orcherton: Sure.

L. McAdams: We did in fact choose to title this report, "Maintaining Human Capital," precisely because we wanted management to see employees as an asset, as a resource, that they are absolutely dependent on instead of being an overhead and a nuisance to be managed. We wanted to create the idea of developing people to their full potential so that they can maximize both their job satisfaction and their contribution to the quality of life in British Columbia through the public service. It was a very deliberate choice to bring this idea of human capital into the report, to bring back that idea of valuing employees. Traditionally, managers have spent a lot of time fretting about physical capital -- maintaining it and protecting it. We would like to see the managers fret and maintain human capital in the same way.

S. Orcherton: Okay. Well, thanks for that comment. I think that's a laudable and, sort of, process that you went through. But I would argue -- not at great length, Chair -- that individual self-worth is far more beneficial to achieving some notion of human capital. That would be my argument, and I'm sure that you're working on that end of the equation as well as the management end of it.

Let me ask a few questions. You talked about $18 million out of a $20 billion budget, I think it was, that's dedicated to staff training -- approximately 1 percent or a little less than 1 percent of the overall budget.

L. McAdams: Of payroll costs.

S. Orcherton: Of payroll costs. I didn't see. . . . Maybe it was there, and I missed it. How is that shaping up in terms of past years? Are we down markedly? Are we staying the same? What is the sort of track record over the last number of years of that ratio?

L. McAdams: I believe we have a three-year trend there. It went down from $20 million to about $16 million over that three-year period.

S. Orcherton: From $20 million to 16 million?

L. McAdams: Maybe, Jane, you could just. . . .

J. McCannell: It went down from $20.9 million in '94-95 to $16.4 million in '96-97.

S. Orcherton: Prior to that, did it sort of stabilize at $20 million?

L. McAdams: We don't have the data.

S. Orcherton: Okay.

L. McAdams: It took considerable research to get those numbers.

S. Orcherton: You spoke about 38,000 employees.

L. McAdams: About 38,000 employees -- yeah.

[1450]

L. McAdams: That's the core civil service. Yeah.

S. Orcherton: Okay. I mean, there are huge pressures obviously. I spoke about some of them. The financial pressures and other issues -- not the least of which is the laying off of workers who provide programs and cutting back funding for different initiatives of government -- have a profound impact on staff morale, the ability to train and those kinds of issues. I wonder if. . . . My sense is that in a variety of ministries, workers are becoming more and more specialized in terms of what they deliver for the public. In that sense, in a way it becomes very restrictive in terms of any kinds of growth opportunities for those individuals.

Do you see that as an overall problem, or am I just seeing things specific to some ministries -- that training becomes more and more specialized and that at the end of the day, in terms of what my colleague from Saanich North was saying, the opportunities just aren't there? People are leaving government, really, with less skills than they had when they came in because of the specialized nature of some of the programs that are delivered in government.

L. McAdams: There's a number of factors going on. I think government is moving, in the classic metaphor, from rowing to steering. A lot of the direct delivery of services is moving out into a tertiary sector, and a lot of the lower-skilled jobs go out there with it. What tends to happen then is that you get a higher-end cadre of skills required at the centre. They tend to be more management and technical, and therefore you do tend to see a more specialist kind of a profile emerge for the core civil service. So that's part of the change that's going on out there. Parallel to that, you do have these leaps in professional and technical knowledge that are going on.

S. Orcherton: Okay. So my sense is that at least in part -- correct? -- the people who work for government are becoming more specialized. Is that right?

M. Nicholls: I think that in certain areas, that's true. In other areas it's more important to be a generalist, and that's

[ Page 1146 ]

Just while we're on this, IT is dealt with a little bit differently. You'll recall that BCSC was, in part, folded into government a few years back. While I was at BCSC, that's where, largely, all of the systems folks were housed and worked from, with conduits to each of the individual information systems areas in government. At BCSC they had a rather sophisticated training and development plan, which supported the individuals within the organization, and moving them into government, that was a real concern for them: that they were going to lose that ability to maintain their knowledge and keep current on changes in the industry. If you're anything like me, with limited knowledge of computer technology, you know just how quickly that changes and how they have to keep in touch with it.

What government did with that particular group is set up a central training fund for them, which is administered by PSEC. PSEC works with the central agency for information technology and others to develop a needs assessment of training and development, and then dollars are allocated accordingly. Where the training is across ministries or cross-agency, PSERC will organize it, because it's more cost-effective to do it from a central point. Where it's unique to ministries, we'll just roll the money back into the ministry for them to take that course. Now, we devote $3 million to that particular group of funding. Faye, is it fair to say that that has remained relatively stable since those folks came into government?

F. Schmidt: The per-person allocation has. The total has varied, because the number of IT professionals has varied. The per-head amount has been relatively stable.

[1455]

L. McAdams: The IT people obviously received a much higher level of training and development. I think we said there was an average of 19 hours of training for public service employees. If you include the IT, it brings it up to about 22, compared to the 29 in Canada generally.

S. Orcherton: So what you're referring to in the IT, at least in my recollection, is what was negotiated by way of bargaining. It was a $500-per-person training allowance. Is that what you're referring to?

F. Schmidt: It's slightly over $2,000.

M. Nicholls: Per person.

S. Orcherton: So it's $2,000.

F. Schmidt: Yeah.

S. Orcherton: Okay. So it has gone up since. . . . Or maybe it's something different.

F. Schmidt: That's been more or less the amount from the beginning.

M. Nicholls: I don't think it's part of that negotiated. . . . That may well be separate. I'm not sure of that. This is just a commitment to fund because of the quick pace of change in this particular area.

S. Orcherton: I just want to follow it back to where I was a moment ago, about specialized training. Do you think, if that is the case -- if there are people finding themselves getting trained, but more and more into a specialized area -- that's part of the frustration that I saw in some of the graphs you had there about workers not feeling like they're being rewarded and not feeling like the training is adequate? Is that a piece of that?

L. McAdams: No. The working environment issues tended to focus around having the tools and resources to get the job done and getting feedback and recognition when they did a good job. They were the main barriers we identified. In some cases. . . . I think about 57 percent said that they didn't fully understand or felt that the procedures to do the job didn't make sense to them. So we didn't really see a specialization issue emerge anywhere that I can remember in the data.

M. Nicholls: I think that in the development of the core competency framework that we talked about, where you're identifying seven particular competencies that you want to see throughout government, those will translate differently in the different jobs. That moves us, I believe, to a more generalist kind of approach. You're targeting for specific competencies, and then you train for specific needs in the job itself.

S. Orcherton: There's one final question. There's a number of recommendations and directions that you're going in, in terms of training. We're trying to get adequate training so we've got a healthy workforce that feels good about their jobs and feels like they're moving forward and those kinds of things. What's the cost of the full implementation of that? Is there any sense of that? We're spending $18 million or so a year -- $16 million to $20 million a year now. What's it going to cost to do that?

M. Nicholls: Well, just give it the figures that the auditor general has identified. We have looked at a recent report by the Conference Board of Canada with respect to Canada's performance in training, just to give you a sense. I don't have a figure for you. I can pull one out of my head, but I don't think that would give you much value.

In the Conference Board of Canada's "1999 Performance and Potential Report" on organizational investment in training and development, the total Canadian dollars per employee were $776. In the U.S. that was $898; in Europe it was $1,328. In terms of preparing our employees for the future, that would say to me that Europe is making much more progress than we are in terms of identifying it as an issue and actually actively working to address that issue.

In B.C. we currently fund to less than 1 percent of payroll. As an overall average in Canada, it's 1.6 percent of payroll.

S. Orcherton: When you're doing a comparative analysis there, is that public sector to public sector? Or what is that?

[ Page 1147 ]

S. Orcherton: Across the board.

M. Nicholls: Public and private sector.

S. Orcherton: So given the European analysis, then, we'd be looking at expenditures of $1,000 per person per year?

M. Nicholls: Probably more in line with the IT area that we fund.

S. Orcherton: So $2,000 per person?

M. Nicholls: I would argue for a period of time, because I think there's going to be a lot of work to do over a transition period of, I'd say, probably five to eight years to really address the kind of issues that are coming at us.

S. Orcherton: So how would that equate, then? I don't have my calculator with me.

M. Nicholls: One percent of payroll?

[1500]

L. McAdams: That would be about $38 million.

S. Orcherton: So to that point, it would be an increase of about $20 million for training at $1,000 per, or $40 million at $2,000.

M. Nicholls: Yes.

L. McAdams: In the report we don't recommend a particular percentage be arrived at. What we recommend is that a thorough needs assessment take place first: figure out where you need to spend money and how you need to priorize it, and then go from there.

R. Thorpe (Chair): I have a couple questions. I guess the first one's a statement.

I'm quite troubled that over the last two or three months we've heard about CHIPS, this wonderful program that was going to solve so many of our problems, then today I hear it's not doing things very well for us -- I mean, probably not the system. I'm also troubled that, I believe -- and correct me if I'm wrong, Maureen or Les -- this investment in our human capital was the number one priority of the deputy ministers' council, and yet when I look at your report, on page 3, item No. 6, we're going to encourage people to comply with CHIPS, and a report is being distributed directly to deputy ministers to ensure compliance.

If this issue is the number one priority of the deputy ministers' council, why are we -- maybe I've got the wrong perception here -- sort of holding hands and singing songs and asking people to encourage them to participate? Why aren't we being a little bit more aggressive, if this is our number one priority?

M. Nicholls: I'll first speak to your point on CHIPS. CHIPS was introduced as a payroll and personnel system, a human resource system, back in 1995. Because of the payroll component, that moved along very quickly and was put into place very quickly. I suspect the personnel or human resource component and the kinds of reports that could be produced and the information that could be produced didn't get the same amount of time and attention. So the data that we were getting out of that had something like. . . . I can't recall the number of different options you could choose if you were filling out a form, for example, on an employee termination. I think it was something like 85 different choices. Then you had "other" at the end; many checked "other." So there has been a process over the past number of months to address the issue of the cleanness of the data going in and the reports that are coming out.

So I, like you, agree that. . . . I think CHIPS was seen as a very good move; I still think it is a good move. But there's no question that we need to improve the way we collect our data and the kinds of reports that we produce that are going to be useful for ministries and for the central agency. I think that's in the works.

Would you like to comment on just the specifics around training and development in CHIPS? Is there anything else you might want to add, Faye?

F. Schmidt: No, I think we've covered the issue. I think you're right that what we're trying to do is. . . . We have issued the edict saying that every training program one-half day or longer shall be entered into the training administration module. Now it's a matter of getting the behaviour in behind that, and we are making positive gains there.

M. Nicholls: Then the next question is: mandatory versus voluntary. I guess, really, our choice and our focus is to encourage joint cooperation between a central agency and the ministries. I think you have a more effective end result if that's what occurs. It might take you a little more of a push at the beginning. If, for example, we're not seeing any progress being made, we may have to go back and rethink that strategy. But I think that ministries are also very sensitive to the issues of training and development. You'll hear from ministries this afternoon, I'm sure, and you'll draw your own conclusions. But I'm not sensing that we're going to have a whole lot of difficulties in this area. If we do, then we'll have to regroup and rethink our approach to it.

[1505]

Well, in my mind, transitions aren't seven, eight, ten years. I'm just wondering, because. . . . I don't know why I did this. I've taken this human capital report, which I believe is an extremely worthwhile tool, and hopefully everyone is going to use it. But I also take it back to the deputy ministers' council on installing performance mea-

[ Page 1148 ]

I don't know if this is a fair question, Maureen, so if you can't answer, that's fine. Is one of the problems we're having -- focusing on getting some of these issues moving quicker -- the ongoing change at the deputy ministers' level?

M. Nicholls: I think there's a number of issues, and that may be one of them. I think that there has been, as the report indicates, considerable reorganization within government. The year that the report collected its data, 1997, I can't remember the exact percentage, but I think about 40 percent. . .

L. McAdams: Forty percent of the jobs redefined in that one-year period.

M. Nicholls: . . .of their jobs were redefined within that one-year period. So you can see from that statistic that a fair bit of change is occurring there.

Also I think it's fair to say that deputy ministers are largely consumed by the issues of the day, the critical kinds of priorities that government has and that they need to be sure they're carrying out on behalf of government. The issues of human resources sometimes don't come to the top as frequently as they should. That's not an excuse, but I think it's a reality of the operating environment, the working environment, within ministries.

R. Thorpe (Chair): But was I incorrect? I thought I heard someone today, or maybe I read it in the last couple of days. . . . Is this not the number one priority of the deputy ministers' council? Did I mishear that?

M. Nicholls: No, you didn't, except that it's the deputy ministers' committee on human resources.

A Voice: So it's a subcommittee.

M. Nicholls: It's a subcommittee of the deputy ministers' council. I should also say that that priority has only recently been identified. I believe it was in June of this year that a list of ten priorities were identified, and that was included on that list. There was a change of deputies round about a couple of months ago, and the composition of that committee changed as a result. We're having our first meeting and regrouping next week to focus on some of these issues.

R. Thorpe (Chair): I understand you're on that committee.

M. Nicholls: Yes, I am.

R. Thorpe (Chair): As is Mr. Trumpy?

M. Nicholls: That's right.

R. Thorpe (Chair): Very good.

You said that this committee issues quarterly reports on this subject. Is that correct?

F. Schmidt: We issue quarterly reports that we distribute to all deputy ministers on training activity.

R. Thorpe (Chair): Would it be possible for this committee to get the last report and, perhaps, the next report so we can kind of get a sense of what's going on there?

M. Nicholls: Certainly.

R. Thorpe (Chair): Thank you.

What jurisdiction has the best training and development -- like, if we were going to model ourselves after someone, you know? I remember America was discovered in 1492, so we don't have to go looking for it again, but where are we modelling ourselves on? What are we looking at as where we want to eventually be?

[1510]

Saskatchewan. . . . No, not Saskatchewan. Would it be Manitoba, Les, that's the other province that. . . ?

L. McAdams: Well, Alberta has got a corporate learning strategy at this stage, and they're heavily invested in executive development, trying to improve the management skills inside the public service. We're seeing the same thing in Ontario and to some extent in Quebec as well. I think internationally the United Kingdom's done a lot of work in terms of improving its civil service. Australia as well. Then various countries around the world have invested not only in their civil services but in their national workforces, by setting standards for investment in training. If you look at page 41 of the report, you'll see a summary of some of the best practices we've seen in other jurisdictions there.

M. Nicholls: I agree with your assumption that there are others that we could model after and that there are some good examples there that we could follow.

R. Thorpe (Chair): I think one of the things it does. . . . Not that Alberta or Australia or the United Kingdom are exactly what we want to be, but it gives us -- especially when we're behind -- a way to catch up and make some adaptations. Hopefully, we're going to do that or -- at least, I would encourage that myself.

With respect to the issue of funding, you know, I'll just share my philosophy, since other people have shared theirs in that area. To me, it's just a question of priority. You either

[ Page 1149 ]

Again, I think it's a question of priority; it's not a question of unlimited funds solving all our problems.

M. Nicholls: I don't disagree with you. I guess I would add a couple of comments or observations that have hit me in the face. With budget cuts, you're really at a point where you're making choices. And you make choices that resolve today's dilemma but don't support a future direction. So some of the choices that managers are having to make in terms of cutting their budgets are: "Do I lay Joe or Jane off, or do I cut down on my co-op students that are coming in, the young folks that are coming in? Or do I not participate in the youth employment program or something like that?" So they're making those kinds of trade-offs; that's the reality. I don't disagree with you in terms of the general belief that if you believe in training, you try to capture it wherever; and you may have to make some unfortunate decisions in that process, but if it's important, it's important.

R. Thorpe (Chair): Especially in No. 12 in the audit's reports, where you're saying that we need champions to lead change, to take that. . . . So with respect to champions, who are the champions of this project at the highest levels of government?

M. Nicholls: Well, certainly I am. And I believe my minister is. He is very supportive of the changes that we're proposing to make and speaks quite eloquently about them. I also believe that we have strong support by the deputy minister to the Premier and by the Premier himself. And I believe that the deputies are committed. They have, as I indicated to you, some difficult decisions to make, and that happens. But the report itself indicated that there was support for the direction.

[1515]

R. Thorpe (Chair): Generally, we're forced to react to day-to-day situations when we don't have, and everybody's signed off on, the strategic plan. That's generally why that happens.

Maureen and Les, what can this committee do? What can this committee do to help advance this subject, not just for the employees of government -- government in the broadest sense -- but for all British Columbia? What can this committee do to help?

L. McAdams: If I were personally to ask you to do anything, it would be to gain acceptance of the idea of human capital and gain acceptance of the idea of looking at private sector companies that are super-successful and how they invest in their people, make them oriented to the goals and give them the skills to get the job done. And have the public service managed that way -- top-class managers managing their people effectively, maintaining the human capital. And have your committee promote that idea of human capital, looking at people as a resource to be invested in, not an overhead.

M. Nicholls: I would just add that I would encourage you -- if you have concerns -- to reflect those concerns to your colleagues, also, and have some influence in terms of how we can address some of those concerns. I'm more than happy to report, at your direction, in terms of follow-up and status of where things are at. I think that's a good check, and it keeps us all on target.

I think that being supportive in terms of protecting the training dollars that are available at the present time would be one step, and that means not freezing those dollars. But in not freezing those dollars, ministries have to be sure that they have the dollars already available to expand, and that'll be the challenge. I would like to see a plan over time where we started to increase our contributions to training and development. I'd like to come back to you in a number of months' time with an overall plan in terms of that direction. I think that would be very helpful to continue to have this committee's comments, concerns and input and relating that back to your colleagues so that change can occur.

R. Thorpe (Chair): How about the end of February?

M. Nicholls: I look forward to it.

R. Thorpe (Chair): Okay. Does anyone else have any questions in this area, or should we move along to the. . . ? You have another part to present, Les?

L. McAdams: It's the three case studies in the three individual ministries, just to give you a closer look at it.

R. Thorpe (Chair): Before we start that, it's 3:20 now. How long is your presentation going to take? We've got three ministry groups waiting once again. This committee is over at 4 o'clock, due to a number of commitments that people have. How much can we get done between now and four, so that those people we're not going to see today can go on and maybe make it a better place?

L. McAdams: We can have a shot at getting you out of here with having gone through the three ministries.

[ Page 1150 ]

L. McAdams: Our presentation will run to about ten minutes.

R. Thorpe (Chair): In fairness to all the ministries, are we going to be able to do that? I mean, do you want to give that a try?

L. McAdams: Let's see how far we get.

R. Thorpe (Chair): Okay, carry on, Les.

Thank you very much, Maureen and Faye.

G. Morfitt: Mr. Chair, just on that subject, the Tuesday agenda, to us, doesn't look that congested. If you find you have to move some of this over into Tuesday, that probably can be accommodated.

R. Thorpe (Chair): Thank you. Yes, we can do that. We've also looked at the Wednesday schedule, and it doesn't look that congested either, so we could fit it in both those days. Let's see where we get to now.

L. McAdams: I'll turn it over to my colleague Jane McCannell to take you through the ministry reports.

[1520]

The first ministry in the report is Transportation and Highways, which has many issues in common with the cross-government study. There are many challenges facing the ministry that affect its human capital. The ministry is increasingly using contractors in many aspects of its work. Therefore, to ensure that the work is clearly defined, designed and completed to ministry standards, staff requires skills and knowledge in areas such as negotiating, team building, legal aspects of contracts, quality assurance and quality control.

In addition to this, significant technological advances are being made in highway engineering. Staff need to be able to assess these advances and determine which would be worth implementing to build the highway system more efficiently and safely. Engineering staff must remain up to date on technological developments through ongoing training.

Our review, therefore, focused on two groups of employees who have been affected by these changes and whose knowledge, skills and abilities are critical to the ministry. The first group is responsible for managing contracts and the second the professional engineers working in the ministry. There was overlap between the two groups in that 81 percent of the engineers also have responsibility for contract management.

First, our overall conclusion. We found that current training and development activities for contract managers and professional engineers have some strengths, but not enough to adequately maintain the ministry's skill base, and there is a risk that it will be eroded. The ministry has a number of building blocks in place to assist it in making more strategic decisions around training. These need to be brought together to develop an overall human resource strategy for maintaining the ministry's human capital.

There has been no evaluation of whether or how training results are improving the performance of the ministry. However, the ministry is currently developing an evaluation tool that will link training to ministry and on-the-job performance.

Finally, the ministry does not currently report to the Legislative Assembly on training and development or about its human capital.

L. McAdams: Okay, we're going to halt at this stage, and then the ministry's response. . . .

J. McCannell: Okay, I'll just stop at that.

R. Thorpe (Chair): Yes, if we could have the response from the ministry. Please identify yourselves.

H. Singh: I'm Har Singh, assistant deputy minister for management services in motor vehicles and the Ministry of Transportation and Highways. Accompanying me is Ron Webber, our manager of training and development. It's my pleasure to be here and provide a brief response to the auditor general's report on human resources, maintaining human capital in the ministry.

We found the report very valuable, and we welcome the issues it brings forth. In particular, we felt that the objective employee feedback -- the survey the auditor general conducted -- was very helpful in letting us know what our employees are thinking. We've had a number of our own surveys. But being from an external, credible source, we put a lot of reliance on it. It highlighted the strategic approach to sustaining human development and linked it to performance and core competencies that the ministry needs. It also highlighted the need to monitor and evaluate the training in terms of the effectiveness of the training itself. The ministry is appreciative of it. It's committed to following up on the recommendations, particularly to keep a focus on the ministry as a learning organization.

In terms of the specific actions that we have taken -- they're on page 2 of my handout -- we have developed a rolling action plan for each of the 11 recommendations made in the report. That is attached. We have made sure that our strategic business plan and the performance agreements of the executive and the directors reflect training as a core priority. The ministry is updating its human resource strategy and training plans to meet the training and development needs and to reflect the recommendations of the auditor's report.

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[ Page 1151 ]

R. Thorpe (Chair): When was that? What period was that?

H. Singh: That was '97-98. However, I should mention that the corporate budget is only a small part of the ministry budget. There's a lot of operational training that is incorporated in the budgets of each and every branch and in the regions and the district offices. That budget itself was a low point and significantly below the two preceding years' budgets. I don't have the numbers handy here, but I think it was down by more than 50 percent -- 60 percent or 70 percent.

As Maureen mentioned earlier, the ministry was facing a very tough choice at that time about how many extra people to put on the layoff list. So maintaining the human capital that has been accumulated over the years temporarily forced stopping or reducing the augmentation of current learning. The decision was painful, but at that time the budget was dramatically reduced. I mentioned 60 percent, 70 percent and 80 percent. The corporate budget was reduced to a mere $50,000, as I said. Over the following two years we've increased that to $150,000. So this year it is $150,000. In addition, the regional budgets have also increased. The information technology budget has been kept intact. It is protected, as Maureen mentioned earlier. Overall, our budget has increased significantly compared to two years ago.

In consultation with PSERC and the regional staff and the ministry, our training and development unit, which is Ron Webber's responsibility, has developed a comprehensive training reference guide to provide this direction to managers -- linking training to performance and core competencies and evaluating the effectiveness of training. A brief outline of the table of contents of that report is attached, which sort of gives a flavour of the contents.

The ministry is working on a pilot project to link training to performance and to evaluate the effectiveness of training. The ministry will be instituting the reporting of training activities in our annual report. We used to do that, but in the last few years it had been neglected. We're reinstituting that in our annual reports to the Legislature.

We're also looking at a number of other areas, like the employee recognition program and recording of all training in CHIPS. We currently do record all cross-corporate training -- cross-government kind of training. We're moving to record all training in CHIPS.

We had a significant youth employment program. We recognized that the ministry's demographic profile of employees has aged very substantially in the last few years. We're at risk in the next few years of losing substantial key competent people, experienced people. So we've expanded our youth employment program in spite of other budget reductions. We've reduced expenditures in a lot of other areas to make room for the youth employment program. In the last two years we've hired approximately 100 young people throughout the ministry and throughout the province to bring them exposure to the ministry type of work.

And finally, the ministry has proposed a joint union-management training and development committee, and we're discussing that next week in our article 29 committee.

[1530]

Where I see a real apparent shortcoming is in the management of contracts at the local level -- the way that local ministry inspectors are able to relate to the contractor and meet the needs of people using the highway system. I was at a meeting the other day, and this was a serious issue with people. They didn't know who was doing the contract management, why there wasn't focus on particular issues. Could you tell me what kinds of training programs you have and what kind of monitoring goes on with inspections at that contract management level?

H. Singh: Contract management was identified in our needs assessment survey, as I mentioned as in the top two categories. We have a number of reinforcements to training at the field level for contract management.

I'll have to look into the supervision of maintenance contractors for applying staff as to. . . .

Interjection.

H. Singh: We did have a list that we were looking at, but I'm not sure we have it right now.

R. Webber: No. To answer your question, in the past we've done a lot of training of that nature. I think that in the last few years, because of our cutbacks, we haven't done as much as we could have. This is one of the areas that we're concentrating on now. We will be offering -- and have been offering over the last few years -- training in that area. We also tie it in with our project management. We have contract management, contract administration and project management training, which covers this area.

J. Weisgerber: My concern. . . . I notice a reference here to management of capital contracts. Evidently, if you're building a large bridge or building an Island Highway or whatever, that's a pretty concentrated area of management. Where I see a weakness in our system is with the maintenance contracts, because in rural parts of the province there might be thousands of miles or kilometres of rural roads. I'm curious to know what kind of training there is for the managers of those maintenance districts or regions.

R. Webber: The area managers?

J. Weisgerber: Yeah, the people who are on the ground, who are actually doing the inspections and the interface with the contractor.

R. Webber: The training has been made available to all those people. Now, there may be incidents where individ-

[ Page 1152 ]

[1535]

R. Webber: I don't think it was a matter of the employees choosing. The training was made available. There may be some new people there, and the dollars haven't been available for travel or delivery of the courses.

J. Weisgerber: Okay.

R. Webber: But that is being changed, and we're moving back to develop more training in that area as we speak.

J. Weisgerber: I only want to identify it as an area that I think needs some attention.

H. Singh: Thank you for bringing that to my attention. We will have a specific look and will be training for field staff that are looking after maintenance contracts.

J. Weisgerber: Thank you.

R. Thorpe (Chair): Whatever you find in that area, could you perhaps provide a one- or two-pager to the Clerk so they can distribute it to members of the committee? Are there any other questions? I guess my question, Har, would be: given the spirit of the auditor general's report and the spirit of Maureen earlier, could you just comment? Do you feel that your ministry is moving in the right direction in the way we have to go to enhance the abilities of the ministry's employees? Is the spirit there? Are we pursuing the spirit?

H. Singh: We certainly are pursuing the spirit of it. The ministry's executive directors all appear to be quite committed to it. They've paid attention to it. There are a number of issues that come with the implementation -- for example, the relationship between travel and training delivery. We made a commitment in all of our communications and with the meetings of directors, and so on, that training is a priority. It's reflected in our strategic plans and all those things. Yet we do have travel. We are concerned about travel, because we have to find dollars somewhere, and that linkage doesn't always happen. They are relatively smaller issues, but we have to be watching and solving them as we go along.

R. Thorpe (Chair): Well, I'm sure you were here earlier when we talked about how we can reduce travel costs in British Columbia. You could take WestJet or Canada 3000 to save money. But I wish you the best in your efforts to find that. It would be fundamentally against the spirit, I think, to say: "We can't do the training, because we couldn't find a few travel dollars." I think that would not be in the spirit of pursuing what we're all trying to pursue here.

L. McAdams: Our next report will be on the Ministry of Agriculture and Food.

J. McCannell: We'll begin this with a review of the human capital issues and challenges facing the ministry. The ministry provides professional support and guidance to the industry in order to increase self-reliance, diversification, technological advancement, sustainable resource management and enhanced profitability. It is clearly in a knowledge business, and over 75 percent of the employees in the regions are knowledge workers. Recently the ministry has made a shift away from extension services, given that many of the services it was providing are now available through the private sector. In addition to this shift, the policy environment is more complex. Employees are dealing with global trade, environmental regulations, animal disease, marketing and competitive issues. These shifts in focus have required different skill sets. For example, employees now work in multidisciplinary teams, the commodity teams, and they deal more frequently with community or industry associations, rather than individual farmers.

[1540]

We also concluded that the ministry's level of training and, in particular, development is not enough to ensure that the skill base of its managers and professional staff will be maintained. Finally, we concluded that the Legislative Assembly should be receiving accountability information about training and development and about the human capital of the Ministry of Agriculture and Food. Currently it receives none.

R. Thorpe (Chair): Thank you. Would you just introduce yourself, please, Dave?

D. Davies: My name is Dave Davies. I'm the executive director of corporate services, Ministry of Agriculture and Food.

[ Page 1153 ]

However, at this point I don't have any additional specific comments to make beyond those that have already been raised in the report itself and the overall response from the PSERC commissioner. MAF is under the direction of its relatively new deputy minister in the early stages of developing specific internal action plans to address the four specific recommendations put forth in its component of the report. This will be done in conjunction with MOTH's training unit in accordance with a service agreement that we have with them to provide us with human resource services.

R. Thorpe (Chair): Does anyone have any questions?

G. Farrell-Collins: Am I then to understand that the Ministry of Agriculture isn't doing any development on its own? It's contracting out to the Ministry of Transportation and Highways -- is that correct?

D. Davies: Well. . . .

G. Farrell-Collins: I'm just not sure if I heard that correctly.

D. Davies: The ministry has a service agreement with MOTH to provide us with certain services. Included in those services are human resource and training development services. So we'll be working in conjunction with that group to develop a strategy and to make progress on these recommendations.

G. Farrell-Collins: Okay. It would seem to me that aside from managerial skills, which are general across all ministries, some of the training and development that you want for staff in the Ministry of Agriculture would be significantly different from the set of skills you'd be training people for to build highways.

D. Davies: Absolutely -- yes. The assistance that Transportation and Highways would provide us is in the area of strategic direction. Certainly the Ministry of Agriculture has to conduct its own training needs, provide its own budget and carry that forward, but we will use Ron's services here to help us with strategic direction and implementing those plans.

[1545]

D. Davies: Well, I'm pleased to be able to report that between the time that the audit was originally conducted and as of today, we've managed to increase the budget sixfold. That's still inadequate.

G. Farrell-Collins: But from what to what?

R. Thorpe (Chair): From what to what? Yeah. So what are you going to do with $6?

D. Davies: Well, at the time the audit was done, I think it was shown that we were spending in the range of about $30,000 -- or something like that. We're up to about $160,000 right now.

R. Thorpe (Chair): Do you have travel dollars so that people can come and take or go to the places that the training is going to be conducted?

D. Davies: Well, we do have travel budgets. The travel budgets are allocated out to the various program areas. They're going to have to exercise some setting of priorities as to how those travel dollars are going to be used.

R. Thorpe (Chair): Is this a number one priority within the ministry?

D. Davies: It is a significant priority of the ministry, yes.

R. Thorpe (Chair): Anyone have any other questions?

G. Farrell-Collins: Yeah, just a quick question. There's been a lot made in the media over the last three or four years about some of the changes that are taking place in the agricultural sector. There is a standing committee of the Legislature -- I don't know if they've completed their work yet or not -- travelling around the province, looking at the agrifood business and what's going to be done there. It seems to me that that industry is facing some real challenges. Probably right across the world but particularly here, there are some big changes taking place in agriculture.

Are you convinced that staff in the ministry are gaining the knowledge and skill sets they need to deal with that, to grapple with that, over time? Do you feel that there is any sort of plan within the ministry to ensure that the skill sets of the various people in the Agriculture ministry are in a position to deal with those changes?

D. Davies: That was certainly. . . . A major recommendation that came out of the report was that we needed to focus more on specific skill development. To answer your question specifically, though, I don't know that I personally am in a real position to be able to evaluate whether or not our field staff have the skills.

G. Farrell-Collins: Who is?

D. Davies: The assistant deputy minister of that particular division. He and other divisional managers in our

[ Page 1154 ]

G. Farrell-Collins: What programs. . . ? There has been a period of time since the auditor general first knocked on your door and said: "We'd like to come and talk to you about this as an issue." PSERC told us that that was some two years ago, 1997, and that they were working in tandem with the auditor general through that process to try and move along. It seemed to me, from what I've heard, that PSERC has come a fair way along that.

I would assume that the people who came and visited your ministry were also available to work in tandem. What programs kicked into gear? I mean, aside from talking to Transportation and Highways, as far as setting up a framework, what actual results have happened in that two-year period?

[1550]

G. Farrell-Collins: What training is being delivered now that wasn't being delivered two years ago?

D. Davies: First of all, more funding is available for the programs to use, to provide the training that they think is necessary. The role of the ministry has evolved over the last couple of years into more of a resource management-economic development type of ministry as opposed to a direct service extension ministry. There have been a number of internal workshops related to new legislation that we're required to administer. Right-to-farm legislation is an example. Things like that have been put in place over the last couple of years.

G. Farrell-Collins: So you've gone from $30,000 to $160,000. Do you know what that's being used for? I mean, is that the cost of these internal seminars?

D. Davies: No. I couldn't give you a list right now specifically of how those training dollars have been spent. Some of them have been spent to support those internal workshops, yes.

R. Thorpe (Chair): Perhaps what you could do, Dave -- realizing you have all the records back at the ministry -- is maybe submit to the committee, through the Clerk's office, a list of the training programs that are in place that this $160,000 or $180,000 budget is being used to support. I think that might be useful.

J. Weisgerber: I won't want to drag it out. I get a sense of some inertia within the ministry. Do you have any sense that the $180,000 will get spent this year?

D. Davies: Definitely, yes.

E. Walsh: We were talking a little bit earlier about some of the difficulties with training and delivering the training in some of the more rural or remote areas. I was wondering, between the ministries of Transportation and Highways and Agriculture and Food, whether you have increased the videoconferencing for training in that area or whether you are in fact using it and if you've noticed any kind of cost saving in it if you are using it.

R. Webber: We're paying particular attention right now to looking at various ways of delivering training to the regions and the remote parts of the province in a cost-effective way. We've just recently developed a brochure on coaching skills. We're putting together a brochure on the use of videoconferencing. We're looking at a number of things. Those are two things that we're right in the middle of producing, so I can comment on those, but we are looking at any way that we can deliver training that's cost-effective and will deliver training to the regions. One of the things that I'm working with at employee learning services. . . . They are working on a cross-ministry committee, developing more cooperation and coordination with other ministries so we can jointly deliver programs in the regions. So those are some of the things that we are doing, and agriculture would be part of that process.

R. Thorpe (Chair): No other questions?

Thank you very much, and we look forward to receiving that information from you. Best of luck.

G. Farrell-Collins: I'm sorry, Chair. Maybe I should talk to you about this afterwards. I'd like to find out a little more information about what has actually been done in the last two years. I know we're going to get a list of what's there. Do you have a sense of how quickly we can get that?

D. Davies: Day after tomorrow.

G. Farrell-Collins: Okay. Pending what's on that package of information, I think, personally I'm not comfortable with the answers we've had so far. We might want to hear back a little further in a little more detail as to what's actually been done. But let's get the documents first and make that decision.

R. Thorpe (Chair): What I might just do, then, is suggest. . . . Dave, I don't know what your next Tuesday or Wednesday look like, but this committee is scheduled to meet. So pending that material, you know, we may ask you to come back next Tuesday between ten and three or Wednesday between one and four. I don't know if those dates work out with your schedule, if we need you, but you could let the Clerk's office know, please.

[1555]

R. Thorpe (Chair): Thank you very much.

Now we'll move along to the. . . . We've got four minutes. Are committee members going to stay, and we'll go through this? Or should we reschedule this part for. . . ? Some of the members have to leave.

[ Page 1155 ]

R. Thorpe (Chair): I can stay.

M. Coell: Well, I can. I think it's a little unfair to the other side if they only have one of them.

R. Thorpe (Chair): What is the wish? We can reschedule it.

E. Gillespie (Deputy Chair): We should carry on.

R. Thorpe (Chair): We will carry on. Thank you very much, Evelyn.

Carry on.

J. McCannell: Next, we turn to our review of training and development in the Ministry of Attorney General. This study has two parts. The first is on management and the second is on deputy sheriffs. We will start with: "Part 1, Training and Development of Management (levels 3-8). . . . " At the time of the audit there were 271 middle managers, levels 3 to 5, and 56 senior managers, levels 6 to 8, who had been working in the ministry for at least one year.

In recent years the ministry has undergone some reorganization and downsizing. As well, it has introduced justice system reforms aimed at improving the efficiency and cost-effectiveness of the justice system in the province. To effectively implement these reforms, managers require strong leadership skills and an ability to manage change. The ministry needs such managers to lead and develop employees who can continue to help the ministry fulfil its mandate and meet the service expectations of the public. The ministry is very large, with 6,000 people to manage and a budget of $900 million as of '96-97. Effective management is needed.

First, our overall conclusion from the study: we found that the current training and development provided to managers in the ministry will not adequately maintain the skill base the ministry needs now and in the future. The central problem is a lack of commitment to management training and development. Decisions about training and development for management staff are being made in the absence of a strategic plan for maintaining the management skill base, although some steps have been taken to bring this about.

There is also no evaluation of whether or how the training and development offered management is improving performance. As well, there was no accountability information about training and development and the human capital of the ministry reported to the Legislative Assembly in its annual report. However, the ministry at the time of the audit had recently introduced a human resource strategy endorsed by the ministry executive, and this should assist it in making better decisions about training and development.

Do you want me to continue with the second part? Okay.

The second part of the audit in the Ministry of Attorney General deals with training and development for deputy sheriffs. The remainder of the presentation deals with our conclusion in regard to this audit.

Deputy sheriffs work in the court services branch of the ministry. The court services branch is unique in being accountable both to the judiciary, for providing judicial administration independent of government, and to the Attorney General, for providing court administration. The branch administers British Columbia's Provincial Court, Supreme Court and appeal courts through regional offices across the province. In this capacity the branch is responsible for supplying, operating and maintaining the courts, sheriff services and transcript services.

At the time of the audit, there were 326 full-time deputy sheriffs. Deputy sheriffs are seen as an impartial provider of services in the court system, as opposed to having an enforcement role. The main functions of the deputy sheriffs include escort services -- transporting accused and convicted persons from police stations and correctional facilities to courthouses and from courthouses to various institutions, and picking up prisoners from jurisdictions across Canada when necessary; guarding and caring for prisoners -- holding accused persons in custody and making sure they get to court on time, ensuring the safety and security of the prisoners, searching prisoners upon admittance, ensuring individuals are properly checked and cleared prior to release, and acting as liaison with other agencies in the corrections branch; court security -- locking, searching and monitoring courtrooms to ensure the safety of the judge, jury and general public; providing security for the whole building -- for example, fire evacuation and other disaster procedures; and finally, jury management, which is managing the administration of the selection process and ensuring the safety of the jury while in the courtroom.

The deputy's job places him or her in both high-risk and highly visible situations that require alert, tactful and mature responses. Much of the deputy sheriff training is focused on the prevention of incidents in the courthouse, and it is hoped they will never have to use many of the skills they are trained for -- for example, hostage survival, firearms and first aid. Therefore, a measure of the effectiveness of some aspects of the training is the number of the incidents in a courthouse. In the 25 years since the inception of the deputy sheriff position, these have been very few. In the context of our audit, our findings relate to whether the training provided is adequate to maintain the skill base to help ensure this excellent safety record into the future.

[1600]

[ Page 1156 ]

T. Vakil: My name is Thea Vakil. I'm the assistant deputy minister for management services in the Ministry of Attorney General. To my immediate right is Lynda Tarras, and she's the director of personnel services in my branch. Next to Lynda is Marg Sorensen, who's the executive director in the court services branch. Marg will answer any questions you have on the deputy sheriff part of the audit. Can the ministry make some introductory remarks?

R. Thorpe (Chair): Yes. Please, make your comments.

T. Vakil: The ministry would like to acknowledge the work that the auditor general's office has done in terms of its audit of the ministry's training and development function. We acknowledge many of the shortcoming that have been identified. The ministry does want to point out that this audit was done in 1997-98 and that since that time, the ministry has taken strategic and immediate action to deal with the issues that have been identified by the auditor general.

I am, as the assistant deputy minister responsible for management services, the chair of the supportive workplace committee, a subcommittee of the ministry executive that is specifically charged with the responsibility of developing a human resource strategy in the ministry. Its plan was presented and approved by the ministry executive in early 1998. The ministry has identified a number of priorities, most of which lead to dealing strategically with the issue of training and development.

The ministry has recognized that succession planning is absolutely key in order for us to be prepared for what is going to happen with our demographics. The ministry also acknowledges that retention, and specifically retention of young people, is a key issue for the ministry, and the ministry acknowledges that performance management is the tool to look at what the training needs are in the ministry. This year the ministry has developed a specific training strategy that lays out the priorities for the Ministry of Attorney General in the coming year. We would be happy to share with you the details of that strategy, if you wish. I do not have sufficient copies with me today, but I would be happy to do that.

We believe that with the specific structure that we have created in the ministry and the strategy that we have developed, we are certainly on the way to dealing with issues that the auditor general has identified. We would be happy to answer any questions that you have. I will try to address the more general ones, and Lynda will deal with the more specific ones in terms of training. As I indicated earlier, Marg will deal with those that have to do with the deputy sheriffs.

[1605]

T. Vakil: They focused on the management staff, the management levels 3 to 8, I think it was.

J. Weisgerber: Okay. Does that function of the management staff. . . ? Is that organization directed at trying to make more efficient use of the court services -- of the courts themselves? Is that where we're. . . ? I'm not quite sure what group of people was the focus of that study.

T. Vakil: Okay, let me clarify -- and maybe I should turn to you to ask to clarify. But let me tell you what my understanding is of what the auditor general looked at. There were two groups of people. As indicated, we have 6,000 employees, so we have to pick the groups of people. The first group were the managers. The managers are those people like me, who work in the central services, but also managers like Marg, who work in courts, and managers who work in criminal justice and all the other departments. They are the management levels across the ministry. Then the other specific group is the deputy sheriffs.

L. McAdams: We wanted to take a look at a middle management cadre to see what kind of training the middle management gets, because they're the senior managers of the future. They're the people who make the difference on the ground on a day-to-day basis. That's why we particularly wanted to take a look at one group, and that's why we went to the AG's.

J. Weisgerber: Has the focus, then, been on that management group or the sheriffs? Or has there been a sort of two-pronged effort to deal with these issues?

T. Vakil: The ministry's view -- and certainly in its strategic plan -- was to focus its efforts, primarily from a strategic perspective, on the management cadre, because they are the ones who we need to groom to follow up on those who are leaving. Those are the ones for whom we need to develop proper development programs -- people who are coming in. It is clear that the people who have operational functions receive operational training. We believe that on that level, the ministry does a reasonably good job. We may disagree in terms of some particular parts of that. But where we think we need to go strategically in the future is within the management cadre. Certainly the ministry's strategic plan has been focusing on that management group.

J. Weisgerber: Thanks.

E. Gillespie (Deputy Chair): This is a specific question that has to do with reorganization. I can appreciate how difficult it must be to develop a strategic plan in the midst of a major reorganization. But you have, among your employees, a group in youth probation who are now in a different ministry but who have a skill set. It is important that they maintain the development of that skill set. So is there some kind of provision for cross-ministry training, to ensure that people who are involved -- people who work in the criminal justice system, albeit under another ministry -- continue to keep pace with people who work within the ministry?

T. Vakil: Yes. I'd like to invite Lynda to provide an answer to your question.

L. Tarras: At a ministry level, at a corporate level, there is connection between the Ministry for Children and Fam-

[ Page 1157 ]

Having said that, I think that the move of the youth probation to the Ministry for Children and Families was a strategic move, in that they want to see them move in a different direction. The priorities will change, so the training requirements may change as well.

R. Thorpe (Chair): Other questions?

Perhaps you could provide the committee with a copy of your plan, because sometimes when you look at things, it gives you the opportunity to ask some questions. But on page 199, it says: "The branch business plan commits to ensuring staff are well trained and knowledgable. Implementing this commitment requires alternatives to traditional classroom training." How are we coming along with that action?

[1610]

R. Thorpe (Chair): Yes, and also the different aspects of your business plan. What are they, and how are you doing these things?

T. Vakil: Are we making any progress? Yes.

R. Thorpe (Chair): That would be important also.

T. Vakil: Yes. Well, the ministry has recognized that in a large ministry such as ours, a decentralized ministry in terms of having a very large number of people in other parts of the province, it is very important for us to investigate seriously the various ways in which we can deliver training programs. Much of that, we believe, can be done on a Web base and on a distance basis. So as one of the key components of our training strategy, we have a project that we are going to work on, starting in January. We are going to find out which kinds of training lend themselves particularly to which kinds of delivery methods, so that we get away from the one type -- classroom training. That's in response to your first question.

In response to your second, we believe that training doesn't really stand on its own within the ministry. The training is an integral part of the way we treat our staff, in the way we deal with, as the auditor general indicates, our human capital. The actions that we have undertaken are sort of preliminary and building to an integrated training strategy. One of the actions which sounds very pedestrian but is very important is that we enforce that performance evaluations are done by managers on managers, so that for the management cadre the needs for training can be assessed through that process.

The other key issue for us is succession planning. If we can imagine what life is going be like five years from now, then we can identify what the core competencies are at that time -- not today but then. When we can articulate that, we can in fact build a training program that would move our future staff, the young people, in that direction. So we work together with PSERC, who are very advanced in the development of the core competencies, in order to allow us to put together a succession plan which will then be the basis for our training. We have made quite a bit of progress in that area.

R. Thorpe (Chair): Are you facing any human resource or financial restrictions to doing the things that you undertook that you would be doing in the ministry?

T. Vakil: Not any more or any less than any other ministries that you've heard today. But the ministry is blessed with an executive that is very committed to the objectives of the human resources plan and an executive that will be willing, I am sure, to put resources to that purpose. We have quite a bit of confidence that the wishes of the executive will be translated into resources as and when they are required.

R. Thorpe (Chair): That's a very good, strong, confident answer. What financial resources for the current fiscal year we're in now have you allocated on a ministry basis vis-à-vis where we were two or three years ago?

T. Vakil: I am sorry I do not know all the numbers and how they have evolved. But the ministry, at the time of the audit, spent about $3 million on training. That includes all of the training for the correctional officers, and all the training that gets done in the Justice Institute is a very large part. So if you're looking at what kind of discretionary money we have for, say, managerial or future training, that would be much less. That might be anywhere between $600,000 and $800,000. That hasn't changed. We certainly have maintained our level of funding for training in general.

[1615]

Does anyone else have any other questions? Apparently not. Pretty easy, eh? There's a benefit to being last some days, isn't there? Anyway, thank you very much. After we've reviewed your plan, if we need to have you come back, we'll look forward to seeing you. Good luck on your plan.

T. Vakil: Thank you.

R. Thorpe (Chair): I'd also just like to thank the auditor general and his staff and PSERC for coming today. I think this has been a very, very useful discussion. Of course, the big challenge now is how we keep the momentum going and how we do some follow-up. I think we have somebody coming back in February, so we'll keep some momentum going there.

The committee adjourned at 4:16 p.m.

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