Treasury Board responds to Shared Services backlash

The Treasury Board’s deputy CIO was quick to quash fears of massive job cuts and private sector outsourcing due to a shared approach to government services on Thursday.

The federal government revealed in its 2005 budget report

that it was planning to centralize job functions within government in the areas of administration, technology, finance and HR. A Shared Services organization would house these functions in a single group and farm them out to various government departments as needed. The plan could save the government billions of dollars annually.

The assumption was that such a plan could have a catastrophic effect on staffing levels throughout government, and the Globe and Mail reported in its Wednesday edition that a minimum of 41,000 jobs could be axed once the plan has been implemented.

That number reflects the people who would be affected by a shared approach, said deputy CIO Jim Alexander, but there is no expectation that they would be laid off.

“In fact, we’ve been quite clear to say there are no layoffs anticipated,” said Alexander. “You still need desktop services, you still need someone supporting your PC, someone paying bills, someone ordering stuff . . . all of those (jobs) are going to be in the future. Those are all part of the 41,000 now and they’re all going to be needed in the future.”

But the government hasn’t been clear in communicating potential change stemming from shared services, according to one IT worker. “We don’t understand the full effects,” said Grace Chychul, who works with Social Development Canada and is the grievance officer for the CS Group.

There are concerns not only of job loss but the general quality of service delivery, she said. Government departments and ministries have their own approaches to IT which may be resistant to a centralized approach, she said.

“Each department has specialized software and over time you become a specialist in that software, in understanding problems and correcting them quickly,” she said. “You won’t have maybe the same ability to do that if you’re bouncing between several different departments.”

It is possible that some departments would be better served by keeping their IT in-house, said Alexander. “There may be some of the organizations that may have special requirements – like security requirements or uptime requirements or regional presence – that might make them unique and might make it just as cost effective for them to provide that service themselves,” he said.

But, he added, at the moment there is no reason to believe that any department will be excluded from the shared services initiate.

A shared services approach has been used by several provincial governments, including Ontario, British Columbia and Alberta. In a lot of ways, it’s an approach that makes organizational and fiscal sense, said Howard Grant, president of Ottawa-based Partnering and Procurement Inc. and an expert in government contracts.

By collapsing multiple systems across government into one shared services department, the government can enjoy economies of scale, he said. “The natural evolution of that is, ‘Now we’ve got our act together, are there even more ways we can be more efficient?’”

There may be opportunities to outsource functions to the private sector, he said, which would free up government to focus on policy issues and create more interesting work opportunities for government IT workers.

HR, payroll and pension management could all be outsourced, he said. “It’s hard to believe that government should actually be in any of those businesses,” said Grant, “because the private sector, in a lot of cases, has a better approach.”

There is no plan to outsource any of these functions on a broad basis, said Alexander. There may be opportunities for private sector involvement, but they would reflect the federal government’s current attitude towards outsourcing. Of the roughly $5 billion the government spends on IT, 20 per cent is directed towards private sector contracts and consulting work, including help desk functions and data centre management.

“We would assume there would still be that sort of mix there,” said Alexander. “The shared service organization over time would be looking at how to provide the best value for money.”

Chychul said she’s concerned that a centralized service approach to IT may breed a more relaxed attitude to the work and “there may not be the same ownership of the problems (in IT) and that will definitely affect the overall public.” But, she said, “if the government decides to do this, there’s nothing we can do to stop it. Let’s face it . . . they have all the playing cards.”

Comment: info@itbusiness.ca

Editorial: Shareware the government way

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