Are there 80,000 reasons that Alcock borrowed a page from Gershon?

“In what has been described as the most significant restructuring of public services for a generation, the rest of the $21 billion (in savings) will have to come from overall efficiency gains such as improving the procurement system, and streamlining areas such as information technology and human resources.  That’s why the skeptics are skeptical.”

In case some of you are wondering if I am just repeating what I had written in Saturday’s post regarding Reg Alcock’s statement “that the “federal government is on the verge of launching the biggest transformation in the way government is managed in its history,” the above comment was made during a July 22, 2004 BBC interview with Sir Peter Gershon.

In the BBC interview, it was announced that the “government’s plans to cut bureaucracy” and in the process “save” £21 billion over a four year period were based on “Gershon’s Review.”  The Review, which was referred to as “a modern bureaucrats Doomsday Book,” emphasized that the savings would be achieved by way of a recommendation to cut at least 80,000 civil service jobs and the introduction of greater process efficiency – think shared services. 

I can only wonder where attrition and retirement came into play in Gershon’s vision of a leaner and a more efficient government?  A question that takes on even more meaning given a May 6, 2009 article in the Financial Post titled “Pink slips replace gold watches.”

Citing the fact that “even before the market crash the average retirement age for men – which hovered at 63 from 1982 through 2005 – had started to rise,” the article went on to state that “Older Americans have gotten the message,” in that they will have to “work longer to make up for the hit their savings have taken,” as a result of the recent economic crisis.

According to economist Alicia H. Munnell, who is also the director of the Center for Retirement Research at Boston College, the “wealth shock” as she called it means that everybody is on average “going to have to work two years longer to make up for investment losses.”

While these results reflect an Americanized view of the world, the fact remains that they nonetheless bring to light one of the many potential flaws in the Government of Canada’s Shared Services strategy.  (Another major challenge, which was disclosed during an interview I had with a senior director from a large multi-national vendor, will be the subject of my next post.  This individual, who spoke on the condition of anonymity, indicates that the government’s current plan to engage one or two suppliers to support their Shared Services platform over an eight year period is doomed to fail because the terms of such a contract pose too great of a risk to most vendors.  The inference here is that ultimately the least desirable vendor(s) will win the business because the most capable will be reluctant to tie-up their resources unless an iron-clad agreement can be reached.  A scenario that very few vendors believe is likely to occur given past experiences with the public sector – my source specifically referred to the helicopter acquisition.)

Given the obvious similarities with the Gershon Efficiency Review, combined with the current economy’s impact on savings is one of the reasons why the paucity of supporting data regarding the GoC’s Shared Services strategy is problematic.  In short, show the public how the goals associated with the program will be achieved without significant job loss.  It should be fairly straight forward.