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MINISTER'S MESSAGE

I am pleased to present the 2008-2009 Departmental Performance Report for Public Works and Government Services Canada (PWGSC). This document summarizes how PWGSC met its objectives outlined in the 2008-2009 Report on Plans and Priorities.

As the main provider of common, central and shared services to other departments and agencies, PWGSC is committed to delivering high-quality services and programs that meet the needs of federal organizations and ensure sound stewardship on behalf of Canadians.

I am pleased to note the impressive work my department undertook late last year to develop its Accelerated Infrastructure Program, as our contribution to Canada's Economic Action Plan. To help stimulate our economy and provide jobs for Canadians, we prepared detailed plans for work on PWGSC's own infrastructure assets, and for providing services to client departments. This included intense project planning in consultation with provincial counterparts and the private sector. This positioned us well for the timely launch of some 900 projects early in the new fiscal year once all approvals had been received.

We made progress on our commitment to modernize Government of Canada procurement, and have continued to improve our processes and timelines, working closely with our key federal partners, while ensuring that Canadian firms, particularly small and medium-sized enterprises, had fair and open access to government contracts. We also undertook major procurements to provide our troops in Afghanistan with the equipment they need.

In support of the Federal Accountability Act and Action Plan, the Office of the Procurement Ombudsman was established. It responded to 355 inquiries, a significant number of which were resolved in a collaborative manner. This work is strengthening confidence in the fairness, openness and transparency of federal procurement practices.

We also succeeded in completing the first of five components of the new public service pension administration system that provides a client relationship management application and a new telephony system. In addition, we centralized three more pension services in the Public Service Pension Centre, located in Shediac, New Brunswick. This transformation will result in significant cost savings, administrative efficiencies and will provide a more consistent service to employees and pensioners.

PWGSC has been implementing its Real Property Renewal Initiative by developing a comprehensive strategy for its real property portfolio of bridges, dams, and highways, and by developing the business systems, competencies, and tools required by a modern real estate organization.

Significant progress was also made on the extensive renovation and restoration of the Parliament Buildings to preserve these heritage buildings and to ensure a secure and welcoming environment for parliamentarians, staff and visitors.

Furthermore, in response to the report of the Independent Advisor on Public Opinion Research, (POR) we reduced POR expenditures across government and ensured better value for Canadian taxpayers when government undertook these activities.

Additionally, PWGSC worked closely with other government departments to green government operations. Priority attention has been focused on areas of highest potential positive impact, namely greening buildings, procurement and fleets.

Finally, recognizing that security remains a priority for the government, PWGSC enhanced its industrial security services by implementing a Quality Assurance Program, which included a security review of active contract files to enhance the security of procurement instruments.

As we continue to make progress on our commitments, I would like to emphasize that these achievements have been made possible by the department's employees along with the support of our various partners and stakeholders. I look forward to building on these successes.

The Honourable Christian Paradis

Minister
Public Works and Government Services

Deputy Minister's Statement

The 2008-2009 Departmental Performance Report for Public Works and Government Services Canada provides an accurate record of the results achieved by the department during the fiscal period April 1, 2008 to March 31, 2009. It reports against our planned spending as outlined in PWGSC's 2008-2009 Report on Plans and Priorities, which was tabled in Parliament on March 31, 2008, and provides a basis of accountability for the results achieved with the resources and authorities entrusted to us.

This document has been prepared based on the reporting principles contained in the Guide to the Preparation of Part III of the Estimates: Reports on Plans and Priorities and Departmental Performance Reports issued by the Treasury Board Secretariat.

It should be noted that the 2008-2009 Departmental Performance Report contains financial results based on approved numbers from the Estimates and the Public Accounts of Canada. PWGSC's disposition of parliamentary authorities, for the purpose of preparing the Public Accounts and the Departmental Performance Report, are presented in accordance with accounting principles related to the appropriation accounting basis formally known as Modified Cash Accounting. The departmental financial statements on the other hand are prepared on an accrual accounting basis. The net results of our Consolidated Departmental Financial Statements as well as our disposition of parliamentary authorities are both presented in the Departmental Performance Report. They do not align due to differences in the underlying principles and standards of the two accounting bases used to prepare them.

Over the last fiscal year Public Works and Government Services Canada has demonstrated a commitment to continuous improvement in program and management performance. Our work on business transformation and renewal, particularly regarding procurement, pay and pension administration, real property, information technology services, and translation, has advanced well. Although challenges remain, I am proud of the progress we have made, and look forward to further improvements in our work on behalf of the government and Canadians.

François Guimont

Deputy Minister
Public Works and Government Services Canada

SECTION 1 - DEPARTMENTAL OVERVIEW

Raison d'être and Responsibilities

Public Works and Government Services Canada (PWGSC) plays a key role in supporting government operations. We are the government's principal banker, accountant, central purchasing agent, translation authority, real property manager and enabler of access to government services online.

The Department of Public Works and Government Services Act (1996) sets out the legal authorities for PWGSC's services. The Act mandates PWGSC to provide common services to government departments, boards and agencies in support of their programs. These include:

• acquisition of goods and services;
• office accommodation and facilities;
• architectural and engineering services;
• construction, maintenance and repair of public works and federal real property; and
• provision of translation, information technology, telecommunications, industrial security and consulting and audit services.

Our Minister is the Receiver General for Canada, responsible for cash management, the Public Accounts of the Government of Canada, and the administration of services related to benefits, superannuation and pension plans and disbursement of pay to federal employees.

PWGSC has more than 14,000 employees in the National Capital Area and its five regions - Pacific, Western, Ontario, Quebec, Atlantic.

Our vision is to excel in government operations by delivering high-quality services and ensuring sound stewardship on behalf of Canadians. In doing so, in 2008-2009, PWGSC:

• Provided accommodation to parliamentarians and to more than 241,000 public servants in 1,800 locations across Canada;
• Provided close to $18 billion in government contracting;
• Issued more than 13 million federal pay and pension payments to Canadians;
• Provided translation and interpretation services for more than 1,200 sessions of Parliament and 1.65 million pages of translation; and
• Handled more than $1.6 trillion in cash flow.

Strategic Outcomes and Program Activity Architecture

PWGSC's strategic outcomes include Quality Services and Sound Stewardship. Our Quality Services strategic outcome ensures that departments and agencies benefit from a range of efficient government-wide common and central services. Sound Stewardship ensures that the interests of the government as a whole, and of Canadians, are taken into account in the provision of our services and through the diligent management of our assets. Our program activities reflect the Program Activity Architecture (PAA) in place during the past fiscal year. Starting with the 2009-2010 Report on Plans and Priorities, we will be reporting on our new, more streamlined PAA.

Performance Summary

PWGSC's program activities, which support federal departments and agencies, are aligned to the Government Affairs' spending area of the Treasury Board Secretariat's reporting framework (see Whole of Government Framework in Canada's Performance 2007-2008). The table below summarizes PWGSC's total financial and human resources for 2008-2009.

Immediately following Budget 2009, PWGSC began intensive preparations to invest more than $400 million over two years to repair and renovate PWGSC's infrastructure under Canada's Economic Action Plan. Important projects include the rehabilitation and restoration of government-owned bridges and buildings, improving accessibility of buildings, and planning for the future of the Manège militaire in Quebec City. We consulted with provincial counterparts, the private sector, our employees, and unions. As a result, we were well-positioned to launch some 900 projects early in 2009-2010. PWGSC will complete these and other projects over the next two years, helping to create jobs and stimulate the economy.

Performance, Financial and Human Resource Summary

($ millions)

Program Activity	2007-08 Actual Spending	2008-09
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Federal Accommodation and Holdings	2,277.4	2,161.8	2,403.7	2,727.0	2,596.2
Real Property Services Revolving Fund	1,035.7	979.9	979.9	979.9	1,272.2
Real Property Disposition Revolving Fund	2.5	3.0	3.0	3.0	1.9
Acquisition Services	247.1	193.4	193.7	264.4	257.0
Optional Services Revolving Fund	101.5	100.4	100.4	104.4	111.7
Defence Production Revolving Fund	-	-	-	-	-
Information Technology Infrastructure Services	464.4	384.4	383.1	294.3	286.2
Telecommunications and Informatic Common Services Revolving Fund	195.9	197.3	197.3	201.0	232.8
Receiver General Services	10.2	9.3	10.4	14.7	20.3
Public Service Compensation Services	5.5	3.4	4.4	6.9	8.2
Information Services	20.3	54.2	62.3	83.2	82.3
Business Integration Services	44.5	-	-	-	-
Linguistic Services	57.8	55.3	55.3	68.6	60.9
Consulting and Audit Canada Revolving Fund	35.3	48.9	48.9	47.1	37.7
Translation Bureau Revolving Fund	218.6	212.7	212.7	229.5	210.9
Greening of Government Operations Services	10.2	54.0	57.0	54.4	15.9
Total Quality Services	4,726.9	4,458.0	4,712.1	5,078.4	5,194.2
Real Property Stewardship	70.4	40.9	41.0	71.2	54.4
Acquisition Stewardship	52.1	34.1	48.2	53.6	59.3
Information Technology Infrastructure Stewardship	15.0	22.8	22.8	146.1	143.0
Receiver General Stewardship	146.1	144.4	144.7	153.0	138.8
Public Service Pay Stewardship	43.4	34.8	34.9	47.0	46.3
Public Service Pension Stewardship	97.5	122.0	122.2	134.5	130.9
Information Stewardship	21.5	18.8	18.8	22.4	19.3
Business Integration - Performance Management	45.6	42.7	42.7	47.3	47.3
Linguistic Stewardship	2.4	2.4	2.4	3.0	2.9
Greening of Government Operations Stewardship	4.8	1.8	1.8	3.7	3.0
Total Sound Stewardship	498.8	464.7	479.5	681.8	645.2
Gross Expenditures	5,225.7	4,923.0	5,191.6	5,760.2	5,839.4
Less: Respendable Revenues	2,877.7	2,579.9	2,579.5	3,055.1	3,380.2
DEPARTMENT TOTAL	2,347.9	2,343.1	2,612.1	2,705.2	2,459.1
Less: Non-respendable Revenues	1,417.3	26.3	26.3	68.8	68.8
Plus: Cost of service received without charge	53.8	42.9	42.9	57.0	57.0
NET COST OF DEPARTMENT	984.4	2,359.7	2,628.7	2,693.4	2,447.3
Human Resources			March 31, 2008	March 31, 2009	Difference
Number of Employees			14,105	14,379	274

Our 2008-2009 Report on Plans and Priorities set out our other commitments for the year, including providing essential equipment to our Forces in Afghanistan; making our procurement processes more efficient - including a focus on small and medium enterprises; strengthening our industrial security program; and protecting the environment through greening government operations.

We improved our delivery of government-wide services in the following areas: information technology shared services, pension and pay administration, and the management of our real property portfolio. We made progress on translation renewal and the restoration of the Parliamentary Precinct. Finally, in keeping with the Federal Accountability Act and the government's commitment to transparency and accountability, PWGSC established the Office of the Procurement Ombudsman.

The table below summarizes PWGSC's progress on its fourteen operational and management priorities in support of our strategic outcomes, as set out in our 2008-2009 Report on Plans and Priorities.

Contribution of Priorities to Strategic Outcomes

OPERATIONAL PRIORITIES - QUALITY SERVICES Departments and agencies benefit from a range of efficient government-wide central services.
Military Procurement
PWGSC worked with Department of National Defence, Industry Canada and the Treasury Board Secretariat to streamline processes and timelines for major military procurements while maximizing economic benefits for Canadians. We accelerated procurement times for the Tactical Airlift Capability contracts, the Halifax Class Modernization/Frigate Life Extension Project, the Minor Warships and Auxiliary Vessel Contract, and the Armoured Vehicle projects.
Procurement Renewal
PWGSC introduced new pre-competed procurement instruments to facilitate buying by federal departments; trained procurement officers and increased awareness of procurement tools across departments. The Office of Small and Medium Enterprises (OSME) assisted more than 23,000 individuals and businesses, and worked to reduce barriers for SMEs doing business with government. Canadian SMEs increased their share of Government of Canada business by 13.9% over the past two years. Improvements were made to MERX, the government's free online tendering system and an improved Web site was launched, providing a single point of access for government buyers and suppliers. An interdepartmental advisory committee was created to guide strategy for Procurement Renewal and significant progress was made on the development of a new business model and services structure for Acquisitions.
Information Technology Shared Services
PWGSC has been improving its business, service and client relationship management disciplines in providing information management and information technology-based solutions to the Government of Canada. Last year, PWGSC completed a Data Center optimization exercise and found economies of scale in the design and management of distributed computing. We initiated Government Enterprise Network Services (GENS) to create economies of scale by consolidating telecommunications services in a phased, optional approach, while continuing to meet the demands of Canadians for Secure Channel services and communications.
Real Property Modernization
PWGSC is implementing various measures to modernize its real property systems, business strategies and workforce. Priority initiatives included: the National Service Management Strategy, a plan to increase our real property service delivery capacity, and the Real Property Business and Systems Transformation Project, an initiative to implement industry-standard real estate business processes, supported by a fully integrated information technology model.
Pension Administration Transformation
To ensure ongoing sustainability, consistent service delivery to all plan members, and improved service levels to employers, employees and pensioners, PWGSC is modernizing its pension administration systems and process infrastructure. This is being done through the Government of Canada Pension Modernization Project and the Centralization of Pension Services Delivery Project, which utilize the latest information technologies and industry-standard practices. The transformation of pension administration is progressing well, and on budget.
Pay Administration Transformation
To sustain the government's long-term requirements for pay administration and operational services, PWGSC developed proposals to replace the 40 year-old system and transform the government's pay administration by increasing automation and self-service, and reducing the requirement for intervention by departmental compensation advisors. Modernizing pay systems will broaden PWGSC's pay administration services, generating significant government-wide operational savings, especially in employee and manager self-service capabilities.
Translation Renewal
To address the growing scarcity of qualified language resources in Canada, PWGSC obtained funding to put in place the Canadian Language Sector Enhancement Program, which will provide scholarships for post-secondary studies in translation, interpretation and terminology; and support for human resource development, entrepreneurship, and research and development in the language industry. To support Canada's linguistic duality, we strengthened our technical and business partnership with Parliament to increase our level of integration with the House of Commons document production system.
OPERATIONAL PRIORITIES - SOUND STEWARDSHIP Canadians benefit from the application of sound stewardship and oversight in the provision of government-wide central services.
Industrial Security Program
PWGSC contributed to the government's national security agenda by safeguarding sensitive Canadian and foreign government information and assets entrusted to the private sector, companies or individuals, when under government contract. Controlled goods are protected against unauthorized possession, examination or transfer when in custody of the private sector. To build capacity of the Industrial Security Program, the number of employees providing industrial security services was increased.
Greening of Government
PWGSC worked closely with other government departments to improve the federal government's ability to green government operations. Achievements include clarifying roles and responsibilities of departments and pursuing government-wide approaches to green buildings, electronic waste, managed print, accountability, and measuring the environmental performance of government operations.
Procurement Ombudsman
The Office of the Procurement Ombudsman (OPO) became fully operational on May 5, 2008, with the promulgation of the Procurement Ombudsman Regulations. The Office responded to 355 inquiries/complaints, a significant number of which were resolved in a collaborative manner without resorting to a formal investigation. Five reviews of procurement practices, involving approximately 19 departments, were commenced and by the end of the fiscal year were very near to completion. Additionally, a study on complaints resolution in the federal government was undertaken with a view to providing alternative dispute resolution as part of its mandate. The work of the OPO has contributed to the strenghtening of relationships between the federal government and its suppliers, while providing guidance on procurement matters to public servants involved in this function. The office provides suppliers with an independent, knowledgeable focal point to handle their issues in a prompt manner. This work is essential in strengthening the confidence of Canadians in federal procurement practices. More detailed information on the work of the OPO may be found in its annual report for 2008-2009 on PWGSC's web site at: http://www.opo-boa.gc.ca.
Parliamentary Precinct Project (Long-Term Vision and Plan)
PWGSC has been providing a single point of service delivery for accommodation planning within the Precinct in partnership with its parliamentary clients: the Senate, House of Commons and Library of Parliament. We have delivered capital and maintenance projects to preserve the integrity of our Parliament Buildings as heritage assets and symbols of Canada. In the past year, we completed and made significant progress on several key projects related to the West Block that will allow it to be vacated in the fall of 2010 in order to proceed with renovations. More information on the renovation of the Parliamentary Precinct may be found on PWGSC's web site at: http://www.collineduparlement-parliamenthill.gc.ca/modern/bbs-bsf-eng.html.
MANAGEMENT PRIORITIES - SOUND STEWARDSHIP Canadians benefit from the application of sound stewardship and oversight in the provision of government-wide central services.
Workforce for the Future
To ensure PWGSC maintains the skills and capacity we need for the future, we have continued to advance our renewal agenda, which includes employee recruitment, retention and development. We have strengthened our commitment to leadership and organizational performance to foster an environment that attracts and retains talent. We also continue to improve our approaches to engage employees and to better communicate our priorities, progress and accomplishments related to human resources management. Our efforts in change management have increased through the development and implementation of a change management framework, which will strengthen our ability to effectively lead change and improve service delivery to clients.
New Financial and Business Management Systems
On April 1, 2008, PWGSC implemented Phase 1 of SIGMA-an integrated solution, based on System Application Products technology, that supports standard and integrated financial management, materiel management and project management processes across the department. On February 16, 2009, Phase 2-SIGMA Release 2 completed the Financial Systems Transformation Project, to support the renewal of PWGSC's financial management framework. SIGMA has enhanced automated financial controls, and facilitates the gathering of detailed transactional data to support business decisions. SIGMA has significantly reduced the total number of financial, asset, and materiel management information systems used in PWGSC.
Quality Assurance and Control
This management priority has been renamed "Organizational Excellence" to reinforce the relationship that sound management and service excellence have to the strategic goals of PWGSC. Efforts are being made under each program activity to improve service quality and value. Results achieved include the development and approval of a departmental approach and framework for Quality Management, the inclusion in business plans of numerous initiatives to improve service quality and the implementation of a series of process redesigns.

Risk Analysis

The PWGSC Corporate Risk Profile, Branch Risk Profiles and Regional Risk Profiles provide the cornerstone for dealing with risks associated with the department's commitments, based on it's corporate priorities. The risk areas identified by the risk profiles included: Human Resource capacity; skills gap; IM/IT infrastructure capability; roles and responsibilities; sustainability; corporate priorities; and transformational initiatives.

Human resource capacity has been identified as a residual risk area affecting the success of programs looking to hire new employees capable of working in PWGSC's complex service environment. Skill gaps have widened as PWGSC veteran employees retire. This capacity issue is being mitigated through new training programs and work process reviews. Heavy dependence on the capability of our IM/IT infrastructure, as well as the need to identify and prioritize current business requirements are leading to the implementation of more robust planning systems throughout the department. Better understanding of our roles and responsibilities is being addressed through communication and organizational awareness programs. Challenges in the areas of business sustainability and transformational initiatives are being addressed through improved human resource management, financial process review and change management planning.

Changes to the economic environment are having an impact on PWGSC's priorities. One significant example, the Accelerated Infrastructure Program (AIP), required the development of a robust risk management framework. This framework is currently under consideration for adaptation by other government departments. By aligning different levels of risk management, PWGSC is able to integrate mitigation strategies horizontally, and leverage its risk response efforts.

Expenditure Profile

Fluctuations in Main Estimates are the result of new and terminated funding for departmental initiatives. The net reduction for 2007-2008 can be explained by procurement savings, while for 2008-2009, it is linked to the transfer of funding to Canada Revenue Agency for office accommodation (offset by additional vote-netted revenue authorities).

Planned Spending represents Main Estimates, earmarked funds in the Fiscal Framework for initiatives approved after Main Estimates, as well as Budget announcements. Planned Spending becomes Authorities once Treasury Board submissions and other transfers are approved.

The major variances between Authorities and Actuals (lapse) for 2006-2007 and 2007-2008 are mainly due to delays caused by uncontrollable and unpredictable factors, such as market fluctuations and internal capacity issues, as well as to the delivery of repair and fit up projects in both Real Property accommodation and capital projects. The lapse in 2008-2009 is mainly due to expenditure restraint measures, which generated efficiencies and savings. Another major component of the lapse relates to frozen funding (unavailable) as the result of re-profiling funding to future years in order to align projects approved cash flows with revised delivery schedules.

Voted and Statutory Items
($ millions)

		2008-09
Vote or Statutory Item	Vote or Statutory Wording	Total Main Estimates	Total Planned Spending	Total Authorities	Actual Spending
1	Operating expenditures	1,975.9	2,002.0	2,169.9	1,994.6
5	Capital expenditures	290.9	533.8	421.6	373.7
(S)	Minister of Public Works and Government Services - Salary and motor car allowance	0.1	0.1	0.1	0.1
(S)	Contributions to employee benefit plans	79.7	79.7	101.7	101.7
(S)	Real Property Services Revolving Fund	-	-	-	(3.2)
(S)	Real Property Disposition Revolving Fund	(5.5)	(5.5)	(5.5)	(11.2)
(S)	Optional Services Revolving Fund	-	-	4.0	2.8
(S)	Telecommunications and Informatics Common Services Revolving Fund	-	-	3.7	(7.1)
(S)	Consulting and Audit Canada Revolving Fund	-	-	3.7	3.7
(S)	Translation Bureau Revolving Fund	2.0	2.0	6.6	4.7
(S)	Defence Production Revolving Fund	-	-	-	-
(S)	Payment in lieu of taxes to municipalities and other taxing authorities	-	-	(1.2)	(1.2)
(S)	Refunds of amounts credited to revenue in previous years	-	-	0.4	0.4
(S)	Spending of proceeds from the disposal of surplus Crown assets	-	-	0.3	0.2
DEPARTMENTAL TOTAL		2,343.1	2,612.1	2,705.2	2,459.2

Note 1: Total Planned Spending is the amount included in the department's 2008-2009 Report on Plans and Priorities and indicates amounts planned at the beginning of the year.

Note 2: Total Authorities include the 2008-2009 Main Estimates plus Supplementary Estimates, transfers from Treasury Board Votes (5 - Government Contingency; 15 - Compensation Adjustments; 25 - Operating Budget Carry Forward; 30 - Paylist Requirements)

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