While the government spent a sizable $10 billion in fiscal 2013 (12 months ended Mar. 31) on a wide variety of professionals, that was nearly $700 million less than in the previous year. It was also the lowest annual total in four years for the sector, which includes engineers, lawyers, management consultants, guards, translators, lobbyists and computer specialists, among others. The sector is often referred to as a shadow government because it contains so many people who work side-by-side with full-time civil servants.
About one-quarter of the government’s annual spending on professionals involves federal departments that contract with each other; the rest of the professional services budget is earmarked for private sector players.
Among the top 12 categories of professional services, the government hiked spending in 2013 only on security, which cost $413.3 million — up 8 per cent year-over-year. The big item here was a 17 per cent jump in the RCMP’s budget for independent security specialists, to $135 million.
In sharp contrast, there were double-digit declines across government for spending on temporary help (down 20 per cent year-over-year), scientific research (off 16 per cent), training (minus 13 per cent) and translation services (a drop of 12 per cent).
This should have been bad news for the National Capital Region, which depends heavily on the professional services sector. But the evidence suggests the latter held up rather well locally. There were 78,100 employed in Ottawa-Gatineau in professional services on March 31 — up 4,600 from a year earlier. A substantial portion of these depend on the federal government for contracts.
The sector employed 85,300 in November — a new record. It made up 12.3 per cent of the region’s total jobs. Indeed, the rise of professional services locally has helped offset to a considerable extent the drop in civil service jobs.
There were 130,200 federal government employees in Ottawa-Gatineau as of November, down 18,000 from Mar. 31, 2012, shortly after Finance Minister Jim Flaherty delivered his most draconian federal budget. Over the same 20-month period, the professional services sector added 11,800 jobs.
These contrasting trends also hint at a third one — it’s possible that retiring government workers are entering the private sector in greater numbers for second careers as consultants or scientists.
During the peak of the government downsizing, the region’s workforce shrank, suggesting civil servants who accepted buyouts or retired were simply saying goodbye to employment. But that may no longer be the case.
A look at the top suppliers of professional services to government shows there are plenty of potential vehicles for a second career. Roughly one in three of the 50 largest in fiscal 2013 are military contractors — not surprising, considering that the Department of National Defence accounts for 30 per cent of the federal government’s total spending on professional services.
Nor has the ratio shifted much over the past decade. All that changes is the ranking of a few military specialists whose revenues ebb and flow according to the status of the government’s most recent major procurements. Babcock (submarines), Halifax Shipyards (warships) and Seaspan Marine (non-combat vessels) have all improved their ranking in recent years courtesy of the government’s program to rebuild the fleets of the Navy and Coast Guard.
The top supplier, General Dynamics, is a U.S. military conglomerate with a key stake in two of Canada’s largest military programs — the long-running quest to replace the Navy’s Sea King helicopters, and armoured combat vehicles, built in London, Ont.
Most of the professional services contracts involving the military are specialized engineering jobs, which is why you find so many ex-service employees doing them. The government shelled out $1.5 billion on military engineering in fiscal 2013, down from $1.6 billion the year before. Even so, that constituted the lion’s share of the $2.2 billion allocated for engineering services of all types in fiscal 2013.
The government also spent more than $1 billion each in fiscal 2013 on health services and information technology, only slightly less than the year before. Express Scripts Canada, the subsidiary of a St. Louis-based giant, manages government employees’ pharmacy, dental and health claims. Dozens of independent contractors — from IBM to Maplesoft — help the government keep its information technology networks up to date.
The Ottawa region is also the headquarters for a lively staffing services sector — companies that fill employment gaps at federal departments, or supply particular skills under long-term contracts for certain projects. Calian, the company founded by former Ottawa mayor Larry O’Brien, is the largest of these, thanks in part to a multi-year deal to supply health services workers to the military.
Among the notable items in last year’s professional services budget government-wide:
• The Department of Aboriginal Affairs and Northern Development spent by far the most on legal services — $106 million. Think land claims. The next biggest spender was Canada Revenue Agency with a legal bill of $66 million. Disputes over tax assessments were a big item here.
• The government earmarked $459 million for management consultants — with Public Works accounting for $184 million. Aboriginal Affairs and Northern Development was the next biggest buyer of management consulting with a budget of $45.5 million.
• The big spenders on health services were Veterans Affairs ($333 million), Public Safety ($257 million) and National Defence ($179 million). This involved anything from treatments for post-traumatic stress to rehabilitation for combat veterans, border guards and members of the RCMP.
Original Article
Source: canada.com/
Author: James Bagnall
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