At our Audit Committee meeting on Friday, September 18th, I made the following motion,
“That Audit Committee recommend to City Council that Administration return to the fall Supplemental Operating Budget Adjustment (SOBA)/Supplemental Capital Budget Adjustment (SCBA) deliberations as appropriate with two scenarios to reduce supervisor full-time equivalents (FTEs) by 5% (up to 92 FTEs /$13.2 million) and 10% (up to 184 FTEs/$26.4 million), aligning with page 18 of the September 18, 2020 Office of the City Auditor report OCA00035.”
This motion was not made lightly as it is expected to result in a reduction to the City of Edmonton’s workforce. Therefore, I’d like to provide a detailed explanation of why I brought forward this motion.
Early this September, the Office of the City Auditor released the first part of our City Productivity Audit. I would highly encourage you to review it in full as it provides a thorough analysis of the City of Edmonton’s workforce, organizational structure, supervision, and management. This audit was originally approved by the Audit Committee in late 2019 to be a part of the City Auditor’s 2020 work plan.
For reference, every year, members of the Audit Committee get the opportunity to sit down with our City Auditor and offer suggestions about what we want to see included in the annual audit work plan. I have had the opportunity to serve on our Audit Committee since I was first elected and I now serve as the Vice-Chair of the Committee.
I first raised the idea of completing an updated City Productivity Audit in 2018. This was informed by a few different factors. The first was that the City Auditor’s previous City Productivity Audit was five and a half years old and I felt it was time for a refresh. The second reason was a letter we received from one of our civic unions. CSU 52 provided council with a letter in 2018 identifying concerns with staffing levels and felt there was an opportunity to provide better value for money.
The latest audit raised concerns about the growth of middle management (22%) and front-line supervisor (19%) positions since 2017. The recommendation from the Office of the City Auditor was to Administration review supervisor responsibilities in the organization in order to reduce costs and layers of supervision. Our City Administration accepted the recommendation and stated in their presentation that this review was already underway.
While the review is already underway, I felt it was important to bring this motion forward because as we all know, these are incredibly challenging economic times. Therefore, it is important for council to provide clear direction to help manage our expenses.
I believe that no tax increase will be acceptable for 2021 and in order to achieve that outcome, we need to offset the budgetary impacts of COVID-19 and reduce some of our regular operating expenses. This audit has provided us with the necessary detail to take specific actions to address our costs.
The chart in the image above provides different scenarios for reductions. The reason I didn’t include the 15% scenario was that I wanted to have the additional parts of the City Productivity Audit to be completed to help guide additional actions. The additional parts provide benchmarking and a specific productivity analysis throughout the organization. I expect that further changes will be made in 2021 but they will be done with the benefit of the other parts of the audit.
We also learned during the discussion that there are currently 146 vacant middle management positions and while that is still less than the 10% scenario, with the current vacancies we could make the necessary changes with limited impact to people. While I’ve seen some comments online that suggest that City employees aren’t providing value, in my experience almost every person working with the City of Edmonton is working very hard every day to serve all Edmontonians. This means that any changes will impact the services and programs that are provided by the City of Edmonton.
For any staffing changes that might occur, I would hope we look to early retirement options for those who might be interested before taking other actions. City Council will vote on the motion at the next council meeting (September 21st, 2020) and then the scenarios would come forward in a few months during our budget deliberations. To be clear, I think we will likely need to choose the 10% reduction scenario in order to achieve a 0% tax increase for 2021.
As noted at the beginning of this post, I did not make this motion lightly. Anytime we are discussing changes within the organization that can impact people, we need to be thoughtful about how those changes are made. As we continue to deal with one of the greatest economic crises in decades, council needs to be willing to make difficult decisions about our budgets. There will be more challenging decisions in the coming months but they need to be made in order to provide financial stability for all Edmontonians.