Politics Insider delivers premium analysis and access to Canada's policymakers and politicians. Visit the Politics Insider homepage for insight available only to subscribers.
The Conservative government is looking to clamp down on pay hikes for public service executives as part of its efforts to rein in federal spending.
With major union negotiations on the horizon before the next election, it appears the government is setting up the executives to serve as an example for a hard line on compensation for the broader public service.
The Globe has learned that an independent panel that has advised Ottawa on executive pay rates has quietly been shelved. Ottawa is looking to replace it with a team that is more focused on reducing costs.
But in sharp contrast to his frequent news conferences criticizing compensation for unionized public servants, Treasury Board President Tony Clement's approach to the non-unionized executives is playing out under the radar.
Roughly three months into the fiscal year that began April 1, the government has not yet announced whether executives will receive any raise at all. Essentially, their pay appears to be frozen, though a government official says no final decision for this year's pay has yet been made.
Since 1998, pay rates – including bonuses and "at-risk" pay for the federal government's 95,000 executives – were largely inspired by an independent group called the Advisory Committee on Senior Level Retention and Compensation. Chaired by Carole Stephenson, the dean of the Richard Ivey School of Business, the committee would examine compensation levels in the private sector and then make recommendations each year to the Treasury Board as to how federal executives should be paid.
Comparisons between the public and private sector when it comes to pay are not easy, given that it requires an attempt to not only look at dollar figures, but also the higher job security that comes with working in a government job.
The goal of the committee was to find the right balance, so that the public service could still attract individuals from the private sector and would not face major problems of losing talent to the private sector.
But in 2011, the government priorities had changed. Retaining public servants was less important during a period when it was working on a plan to shed more than 20,000 jobs.
The advisory committee was shut down without an announcement.
A spokesperson for Mr. Clement confirmed the committee is no longer. There was no committee report in 2012. The government simply issued a notice that the executives would receive a 1.5 per cent pay increase on April 1, 2012. It also announced that 40 per cent of at-risk pay for executives would be tied to "the all-of-government spending review" and the remaining 60 per cent would be tied to individual performance.
Andrea Mandel-Campbell, Mr. Clement's director of communications, said the government plans to re-launch the committee with a new focus.
"We'll be reconstituting it with an eye to balancing that mandate a bit," she said. "We've been very clear about compensation and about the need to contain costs and we can't be talking about that for the public sector in general and not include executives as part of that."
Gary Corbett, the President of the Professional Institute of the Public Service of Canada, said it sounds like the government is planning to use a hard line on executive play to foreshadow collective bargaining with the unions.
"It's positioning for other messages to the public service," he said, pointing out that Mr. Clement has already said the government wants to reduce sick leave and improve performance management. "Those messages are consistent, but unfortunately, they're heavy-handed."
Bill Curry covers finance in Ottawa.