A federal bureaucracy we can ill afford

They say bureaucracy grows to meet the needs of the expanding bureaucracy.

That certainly seems to have been the motto in Ottawa of late, with the number of federal civil servants having increased by upwards of 100,000 over the past decade.

As the size of the bureaucracy increased, so too have the resources it consumes and its burden on the federal budget. If Prime Minister Mark Carney’s government is serious about tackling its spending problem, it has no choice but to shrink the size of the federal bureaucracy.

From roughly $39.6 billion in payroll costs when Prime Minister Justin Trudeau came to power in 2015, the cost of employee compensation in the federal government ballooned to $71.1 billion last year. This represents a 79.5 per cent increase in costs over the course of only nine years.

When dealing with numbers this large, it is hard to grasp just what they represent. To put it into perspective, this $71.1 billion represents some $1,700 per Canadian, or $7,000 per family of four.

Needless to say, it’s a lot of money, and you’d be right to want to make sure that, if it is to be spent, it is spent as efficiently as possible. And that’s where Canadians are torn.

While there is no majority either way, Canadians are more likely to say they receive poor value for money from the federal government.

It’s easy to see why.

Despite the unprecedented hiring spree over the past decade, it seems like services have not been getting better.

Lines at the passport office remain substantial. Going through customs at the airport is still an arduous process. And if you need to ask the Canada Revenue Agency a question, you know you’re in for a long wait before somebody picks up the phone on the other end.

Given the size of our deficit and the costly inefficiencies in our bureaucracy, the taxpaying-public deserves, and should demand, a thorough spending review from the federal government.

If the rapid increase in personnel spending and staffing has not yielded better results, it should be a crystal-clear sign that these resources are not being used efficiently. That would make it a prime candidate for budget cutbacks, and it should be evident that such cuts can be done with very limited—if any—effect on the speed, quality, and quantity of government services Canadians can get.

We also need to acknowledge that this spending on new personnel is quite costly, and will only get costlier as the years go by.

Currently, the average compensation for a full-time job in the federal government is around $150,000 per year. This includes salary, the taxpayer-funded part of pension contributions, and the various benefits enjoyed by federal bureaucrats.

According to projections from the independent Parliamentary Budget Office, this is bound to increase to a whopping $172,000 by 2030, based on the labour agreements the government has signed and the expected composition of the federal workforce.

This contrasts with the roughly $60,000 per year that the average Canadian—also known as the taxpaying public—currently earns.

If the growing size, cost, and ineffectiveness of the bureaucracy need to be addressed, readers will note that addressing it isn’t something the government is known for.

Whereas the private sector routinely reevaluates whether positions are needed and whether individuals can be used more effectively, there is a perception that the government simply keeps growing without ever addressing these issues.

But while it is uncommon, governments have in the past looked into the size and scope of the bureaucracy to make it more efficient, and Canada’s federal government actually devised the gold standard in these matters.

Back in the 1990s, under then-Prime Minister Jean Chrétien’s government, Ottawa underwent a thorough spending review process which allowed it to eliminate just over 17 per cent of government positions.

If the Carney government were to carry out a similar process, it could cut some 64,000 taxpayer-funded positions in Ottawa, yielding annual savings of at least $10 billion.

Given the size of our deficit and the costly inefficiencies in our bureaucracy, the taxpaying-public deserves, and should demand, a similarly ambitious review from the federal government.

Renaud Brossard is Vice President, Communications at the MEI. The views reflected in this opinion piece are his own.