Dear Premier McGuinty and Minister Duncan:
Thank you for inviting me to chair the Commission on the Reform of Ontario’s Public Services. This can be an important turning point in the province’s history and I welcome this opportunity to present the ideas contained in this report.
I especially appreciate the extraordinarily wide mandate you gave the Commission, which makes it much more than a simple exercise in cost-cutting. It has allowed us to delve into almost every corner of the government’s activities and to think long and hard about how government can work better for the benefit of everyone in the province. It recognizes that the people of Ontario deserve the finest public services at a cost that is affordable.
Let me first thank the other three commissioners. Dominic Giroux, Susan Pigott and Carol Stephenson brought to this work long and varied experience and keen minds that added enormously to the quality of our thinking. The Commission’s work has benefited from the views and work of many people, both inside and outside the government, who took time to share their views with us. We had excellent support from the Secretariat under the leadership of Scott Thompson. Members of the Ministry of Finance were particularly helpful, but we also benefited from the wise counsel of many people in the Ontario government, who gave us generous access to their ideas and data.
With such a broad mandate to be carried out over a limited period, we were not able to conduct comprehensive consultations. But every group we asked to meet us not only accepted our invitation, but offered great ideas for reforms in their domains. We thank them all.
Ontario faces two serious fiscal challenges. The first is to get out of the current large deficit. This will take many years, but the task does not end there. It goes almost without saying that every effort must be made to bolster future economic growth rates, and much has been done in that regard, such as reinvesting in education and reforming the tax system. But with a looming slowdown in the expansion of the labour force that is almost upon us and with the province’s weak productivity growth of late, Ontario cannot count on a resumption of its historical strong growth rates. This means that the sharp degree of fiscal restraint needed over the next few years to eliminate the deficit may see a point of some reprieve, but not much. Spending simply cannot return to recent trends.
This context lifts the task ahead well beyond that of merely cutting or restraining costs. We must be students of history and history shows that simple cost-cutting by governments too often generates fiscal improvements that peter out after a few years as pressures build. In the end, spending surges again and the result is more of the same, but at a higher cost.
The only way to get out of deficits and stay out, in a period of limited economic growth, is to reform government programs and the manner in which they are delivered.
This should be viewed as an opportunity, not a problem. Ontario can and should have the best public services in the world; this is an opportunity to reach for that goal. To get there, we should study promising practices around the world by others who have faced similar issues.
But to be the best, we must go beyond that. Ontario should become the first government to relentlessly pursue quality and efficiency in public services. It is often argued that governments cannot do this because they lack the discipline imposed by a bottom-line profit imperative and shareholders to hold them to it. But the Ontario government has over 13 million shareholders who do not want their government to run deficits and believe they already pay enough taxes. That should be incentive enough.
What we need is to drive those incentives into every corner of government and the broader public sector. Programs need clear objectives. Metrics must be created to track whether programs meet those objectives. If not, the programs must be changed.
The government must constantly benchmark its effectiveness and efficiency against the private sector and against the best public services in the world. It must be prepared to shed old priorities (and offend their advocates) and set new priorities (which often have no advocates) as they arise.
It must make tough decisions on which services are best delivered by the public service and which can be better done by others, in the private sector.
The calling of public service must be restored to a position of honour and respect, so it can draw the province’s best and brightest. Their performance should be adequately compensated and rewarded — not for effort, but for results. There is huge value in a public service that can think deeply and wisely about public policy and deliver effective programs in an efficient manner.
Ontario must be the leader in shifting public services from a reactive to a proactive mode. Whether it is health care, social services, education, training, economic development or almost anything else, governments typically patch up things once something has gone wrong. Ontario must shift to foreseeing problems and cutting them off before they develop. This in turn requires a government with a serious research capacity, both internally and through what it can draw from the outside.
The Commission has made hundreds of recommendations for improving the effectiveness and efficiency with which public services can be delivered.
None of these choices will be easy and many of our proposals will draw vigorous criticism. But it must be kept in mind that our recommendations can deliver the needed degree of spending restraint to balance the budget by 2017–18 only if all are implemented. This imposes a discipline of its own. We expect that many of our recommendations will be rejected. We accept that, but each rejected recommendation must be replaced not by a vacuum, but by a better idea — one that delivers a similar fiscal benefit.
Our recommendations are daunting in depth and scope. Indeed, they may seem overwhelming, even to the point that the government may fear that they exceed its political and bureaucratic capacity to carry them out. But there is benefit to moving quickly on many fronts at once. Targeting certain programs or sectors for reform and restraint can generate a sense of unfairness. A wide-ranging reform effort will reinforce the notion that we are all in this together, that all Ontarians can support the reforms because they will benefit in the end from these changes. And none of this will work if there is no public support.
Although we have not made a formal recommendation on this point, I urge you to consider holding broader consultations on the economic and fiscal challenges facing this province. Ontarians have not yet grasped the extent to which the slow decline of this province’s manufacturing base has undermined both its historic economic advantage relative to the rest of Canada and the provincial government’s long-term ability to finance the public services they treasure. You should go beyond a legislative body to review our report and consult as well with the wider public through town hall gatherings and meetings of stakeholders. An informed public is essential to the success of the reforms.
Action must begin very soon. The deficit is expected to be $16 billion this year. By 2017–18, it will almost double — and the debt will climb to more than half of gross domestic product — if the status quo is left in place. Decisive, firm and early action is required to get off this slippery, and ultimately destructive, slope. At a time when the news is full of stories of countries around the world that have failed the fiscal test and slid into the ditch, to the enormous detriment of their citizens, Ontario must be different. It must be the best.
Commission on the Reform of Ontario’s Public Services
A special thanks to the Secretariat to the Commission on the
Reform of Ontario’s Public Services:
Barb Brownlee, Stephen Donnelly, Craig Fowler, Caspar Hall, Art Komarov,
Jenna LeBlanc, Kaleb Ruch and Jonathan Tekle.