What can public servants expect from Canada’s new government?

By on 20/11/2015
Ian Lee is an assistant professor with Sprott School of Business at Carleton University in Ottawa, Canada

Canada’s new Liberal government has been careful to praise public servants, striking a much warmer note than its predecessor. But Ian Lee says it may still pursue some challenging reforms

On October 19, Canada’s Liberal party won the general election, ending ten years of Conservative rule. The support of public servants aided its victory – for the defeated Stephen Harper-led government had alienated many of them, having publicly criticised everyone from the Chief Justice of the Supreme Court to the public sector unions. In my view, the relationship between Harper’s government and the public sector unions was the worst ever seen in Canadian history. The largest union – the Public Service Alliance of Canada – even distributed buttons to its membership in 2014 with the slogan ‘Harper hates me’, with some members wearing theirs to work.

The extraordinarily bad relationship was due in part to the hostile tone and negative attitude expressed by key ministers in the Harper government towards the public service: some Cabinet ministers regularly referred to the “gold-plated pensions” of civil servants, while the former Conservative minister responsible for the public service, Tony Clement, spoke out over officials “not pulling their weight.”

These tensions were exacerbated by major reforms to the federal public service and the collective bargaining process. In a bid to bring public servants’ wages and benefits more into line with the private sector, the government increased public servants’ minimum retirement age from 55 to 65, and raised their share of both pension contributions and retiree health care premiums from 25% to 50%.

Finally, and most controversially, former Treasury Board president Clement announced that the government would modernise the sick leave system. Currently, if public servants are sick for more than 13 weeks, they are taken off the payroll and put onto long-term sick leave managed by a private insurance company; but those with good track records on sickness absence can ‘bank’ unused sick leave, deferring this shift to insurance cover. Clement pledged to abolish such deferrals, predicting that the reform would save $900m (US$675m). As the three largest public sector unions refused to negotiate sick leave, the government introduced and passed a bill granting it the unilateral right to adopt the new system.

Though the new system was never actually implemented, the anger amongst union leaders and the rank and file was so pronounced that during the election campaign the three unions campaigned in support of opposition candidates who promised to respect the public services. Perhaps that campaign tipped the odds; in any event, on 4 November the new Liberal cabinet was sworn into office – including the new Treasury Board president, Scott Brison.

One of the first things Brison did was to issue a reassurance to public servants in a CBCOttawa radio interview: “What I’m not going to do is what my predecessors under the previous government did, and that is use issues like [sick leave] as political footballs and negotiate through the media. We will negotiate respectfully as part of a collective bargaining process”.

However, to signal that the new Liberal government is not going to accept the unions’ position on all major issues, Brison added that “when we disagree, we will do so without being disagreeable”. Moreover, Brison pointedly refused to state the new government’s position concerning sick leave reform, suggesting merely that there would be reform.

So what can public servants expect from their new boss? Brison is an experienced politician who served in the previous Liberal government of Paul Martin from 2004 to 2006. He’s a long-standing MP for a rural riding (an electoral constituency) in the Maritimes, having represented Kings-Hants, Nova Scotia, in the House of Parliament since the late 1990s. Nova Scotia, where he was born, historically has higher unemployment and lower household incomes than the national average.

So Brison understands that, as unpopular as these Conservative government policies are with public servants, they are widely supported in many parts of the country – where two thirds of Canadians have no employer pension plan at all, and lack job security. The average wage gap between the federal service and the rest of Canada has increased significantly, with public servants enjoying a median family income of $96,000 (US$72,039) compared to $76,000 (US$57,030) for the rest of the population.

Meanwhile, the economy is growing at a much slower rate, which means lower government taxation revenues; earlier this week, Canada’s Parliamentary Budget Office slashed its 2015 growth forecast in half and predicted deficits in each of the next five years. This forecast is based on the Harper government’s last budget, and doesn’t take into account Trudeau’s expensive election promise to run a $10bn (US$7.5bn) deficit to fund economic stimulus programmes. Thus the Liberals have very little economic room to manoeuver.

So if they must choose – and I think they must – between looking after the 300,000 federal public servants, and keeping their promises to millions of voters across Canada, I believe they will prioritise the latter. To be fair to the Liberals, they never promised specifically to reverse any of the Harper decisions. But they repeatedly said that they would treat public servants with respect. It looks likely that, even after Harper’s departure, public servants will still experience Harperism – albeit with a much, much nicer tone.

Ian Lee is an assistant professor with Sprott School of Business at Carleton University in Ottawa, Canada

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