November 19, 1998.
To:Strategic Policies and Priorities Committee
From:City Clerk
Re:Update on Consulting Assistance for Amalgamation
Recommendation:
The Budget Committee on November 18, 1998 reports having:
(1)received as information the report (September 29, 1998) from the Executive Director,
Human Resources and Amalgamation;
(2)requested Local 79 to forward a letter to the Budget Committee outlining its concerns
in detail; and
(3)recommended that this matter be considered further at the meeting of the Budget
Committee scheduled for December 8, 1998 and that it be listed as a deputation item.
Background:
The Budget Committee on November 18, 1998, had before it the following:
1.a report (September 29, 1998) from the Executive Director, Human Resources and
Amalgamation regarding an Update on Consulting Assistance for Amalgamation; and
2.communication (November 17, 1998) from the Acting President, Local 79, Canadian Union
of Public Employees.
Ms. Anne Dubas, Local 79, Canadian Union of Public Employees, appeared before the Budget
Committee in connection with this matter.
City Clerk
Barbara Liddiard/cp
Item No. 4
Attachment
c.Chief Financial Officer and Treasurer
Director of Budgets
Chief Administrative Officer
Executive director, Human Resources and Amalgamation
Roda Contractor, Senior Policy Advisor, Amalgamation Office
(Report dated September 29, 1998 addressed to the
Budget Committee from the
Executive Director, Human Resources)
Purpose:
The purpose of this report is to update the Budget Committee on the work and expenditures of
external consultants assisting with amalgamation and the organizational design of
departments.
Source of Funds:
There are no funding implications concerning this report.
Recommendation:
It is recommended that the Budget Committee receive this report for information.
Background:
City Council, at its meeting of February 4, 1998, had before it a report, "Strategic
Restructuring Initiative" (January 19, 1998), from the Chief Administrative Officer. Council
directed the Chief Administrative Officer to obtain proposals from consulting firms "to
provide objective guidance and assistance in the amalgamation of the services and functions
provided by the seven former municipalities." An overall budget of $5 million was allocated
for the purpose of utilizing consulting expertise to assist in amalgamation and service
rationalization projects in all departments.
Subsequently, City Council, at its special meeting of April 29, 1998, had before it a report,
"Amalgamation and Restructuring 1998 Funding Requirements," dated April 16, 1998, from
the Executive Director of Human Resources and Amalgamation (Report No. 6, Clause 19,
Strategic Policies and Priorities Committee). Council adopted the recommendation of the
report that funds in the amount of $2.5 million be approved for external consultants to assist
with amalgamation and restructuring on a one time only basis in 1998. This was the initial
half of the $5 million allocated for amalgamation activities.
Council also adopted the recommendation that:
"the Chief Administrative Officer report to the Budget Committee in four months' time with a
full update and review on the expenditures and work to be provided."
Below is a summary of the expenditures and work provided by external consultants for
amalgamation and restructuring activities as of September, 1998.
Comments:
Consulting firms have been hired to work with staff on Phase 2 of amalgamation, which
involves the restructuring of departments, divisions and units. Successful firms went through a
competitive and rigorous selection process. This involved, first, responding to an Expression
of Interest so as to be placed on a shortlist of qualified companies. These companies were then
eligible to respond to a subsequent Request for Proposals. A three-member sub-committee of
the Strategic Policies and Priorities Committee was struck to review submitted proposals with
staff.
In January, 1998, in order to commence work on amalgamation immediately, the firm of
Johnston Smith International was retained to work with the CAO's Office to assist in the
development of an overall amalgamation strategy, to develop templates and guidelines to be
used by departments and, subsequently, to conduct pilot projects in Corporate Services and
the Finance Department.
Of the $2.5 million approved by Council on April 29, 1998, expenditures for consulting
assistance are $1,142,714, as of mid-September, 1998. Total estimated expenditures for
known items to year-end are $1,570,000. Further expenditures will occur as additional project
proposals are finalized. A summary of activities and costs by department is outlined in the
ATTACHMENT.
Work has recently commenced on Phase 3 of amalgamation, which deals with service
integration and rationalization projects in departments. City Council, at its meetings of July 8
and 29, 1998, approved a series of transition projects, including one for $2.5 million for
external consulting expertise to assist with service rationalization projects. Similar to this
report which focuses on Phase 2 consulting expenditures, a report will be prepared to the
Budget Committee on consulting expenditures incurred as part of Phase 3 projects. Together,
these two phases constitute the $5 million budgeted for consultants for amalgamation
activities.
It is recommended that the Budget Committee receive this report for information.
Contact Name:
Roda Contractor, Senior Policy Advisor, Amalgamation Office, 397-0459
(Communication dated November 17, 1998 addressed to
Councillor tom Jakobek, Chair and Members of the Budget Committee, from the
Acting President, Local 79, Canadian union of Public Employees)
The report lists all the consultants hired to work on Phase 2 of amalgamation which involves
the restructuring of departments, division and units.
A budget of $5-million, just for consulting fees on restructuring, has been approved by
Council, as has the reduction of 2,500 jobs. In addition, there are numerous other fees being
paid. We understand that $40-million has been approved for consultants during the transition
period.
CUPE Local 79 is concerned about the vast sums of money being spent and the extent of the
influence of outside consultants on the internal workings of our new City. We have
consistently disagreed with the decision to use outside consultants. There are tremendous
existing resources in the former municipalities. There are staff with skills and experience and
a sense of history. While we may not always have agreed with their decisions, they had an
understanding and respect for the importance of public services.
Recently the Ontario government admitted that it had mismanaged--and over-aid--a
$180-million consultant's contract. Fees were raised by 63% and project staff were being paid
$575 an hour.
The City is facing serious budget pressures. Councillors must be sure that they are getting the
priorities straight in the face of competing demands for services. Accountability is essential.
Taxpayers will want to be sure that they are getting the best value for their money.
We ask members of the Budget committee to ensure that accountability and respect for the
important contribution of the City's own employees are guiding principles in the consideration
of contracts for outside consultants.
November 25, 1998.
Ms. Anne Dubas
President
Canadian Union of Public Employees, (CUPE)
Local 79
257 Adelaide Street West
Third Floor
Toronto, Ontario
M5H 1X9
Dear Ms. Dubas:
The Budget Committee on November 18, 1998, had before it the following:
1.a report (September 29, 1998) from the Executive Director, Human Resources and
Amalgamation regarding an Update on Consulting Assistance for Amalgamation; and
2.communication (November 17, 1998) from the Acting President, Local 79, Canadian Union
of Public Employees.
The Budget Committee during its meeting requested you to forward a letter outlining your
concerns in detail and agreed to consider this matter further at the meeting of the Budget
Committee scheduled for December 8, 1998 and that it be listed as a deputation item.
City Clerk
Barbara Liddiard/cp
Item No. 4
Attachment
