Departmental Performance Report 2015-16

Minister's Message

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Result Highlights

Section I: Organizational Overview

Organizational Profile

Appropriate Minister: The Honourable Judy Foote, P.C., M.P.
Institutional Head: Ron Parker
Ministerial Portfolio: Public Services and Procurement (formerly Public Works and Government Services)
Enabling Instrument(s): Shared Services Canada Act^{Footnote i}
Year of Incorporation / Commencement: 2011
Other: Associated Orders in Council (OIC) include Privy Council Numbers 2011-0877; 2011-1297; 2012-0958; 2012-0960; 2013-0366; 2013-0367; 2013-0368; 2015-1071 and 2016-0003^{Footnote ii}.

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Organizational Context

Raison d’être

Shared Services Canada (SSC) was created on August 4, 2011, to transform how the Government of Canada manages its information technology (IT) infrastructure. SSC is delivering mandated email, data centre and network services to partner organizations in a consolidated and standardized manner to support the delivery of Government of Canada programs and services. With a whole-of-government approach to IT infrastructure services, SSC is creating economies of scale to deliver more efficient, reliable and secure IT infrastructure services to Government of Canada departments. SSC also provides certain optional technology-related services to government organizations on a cost-recovery basis.
The Minister of Public Services and Procurement is responsible for this organization.

Responsibilities

The Shared Services Canada Act recognizes that the Government of Canada wishes to standardize and streamline, within a single entity, certain services in order to support government institutions. Through specific OICs, the Department received responsibilities for federal IT infrastructure services.
These responsibilities include:

• maintaining and improving the delivery of IT infrastructure services across the federal government;
• enhancing the security of federal IT infrastructure; and
• transforming and modernizing government-wide IT infrastructure in order to provide value for money for, and improve services to, Canadians.

Specifically, SSC is continuing to work with the information and communications technology (ICT) sector to:

• deliver a government-wide, enterprise email system (your.email@canada.ca);
• consolidate and modernize federal government data centres; and
• transform federal telecommunications services.

Through these activities, SSC is also contributing to the successful execution of other critically important Government of Canada programs and services such as:

• Military and police operations at home and abroad;
• Border security operations;
• Weather forecasting;
• Health alerts; and
• Multiple benefit payments, including the Child Tax Benefit.

SSC is also supporting progress towards the vision of the future public service as articulated in Blueprint 2020.

As of September 1, 2015, OIC 2015-1071 allows SSC to offer any or all of its services to any federal government entity, as well as to another Canadian jurisdiction or a foreign government, as long as SSC does not incur any additional costs or deployment of resources. The OIC also expands the delivery of other SSC services, including email, data centres and networks to a range of new clients. Most small departments and agencies previously not served, or served only on an optional basis, are now identified as mandatory SSC clients under this new suite of services.

Strategic Outcome(s) and Program Alignment Architecture

• 1. Strategic Outcome: Modern, reliable, secure and cost-effective IT infrastructure services to support government priorities and program delivery.
  • 1.1Program: IT Infrastructure Services
    • 1.1.1Sub-Program: Distributed Computing Services
      • 1.1.1.1 Sub-Sub-Program: Workstation Services
      • 1.1.1.2Sub-Sub-Program: Desktop and Office Productivity Suite Services
      • 1.1.1.3Sub-Sub-Program: Email and Directory Services
      • 1.1.1.4 Sub-Sub-Program: File/Print Services
      • 1.1.1.5 Sub-Sub-Program: Remote Access Services
      • 1.1.1.6Sub-Sub-Program: Distributed Computing Services Program Management
    • 1.1.2Sub-Program: Production and Operations Computing Services (Data Centre Services)
      • 1.1.2.1Sub-Sub-Program: Utility Computing Services
      • 1.1.2.2Sub-Sub-Program: Dedicated Application Hosting and Management Services
      • 1.1.2.3Sub-Sub-Program: Facilities Management Services
      • 1.1.2.4 Sub-Sub-Program: Production and Operations Computing Services Program Management
    • 1.1.3Sub-Program: Telecommunications Services (Data, Voice and Video)
      • 1.1.3.1Sub-Sub-Program: Data Network Infrastructure Services
      • 1.1.3.2 Sub-Sub-Program: Inter and Intra Data Centre Network Services
      • 1.1.3.3Sub-Sub-Program: Voice Network Services
      • 1.1.3.4Sub-Sub-Program: Image and Video Communication Services
      • 1.1.3.5Sub-Sub-Program: Call Centre Services (Data and Voice Network Infrastructure)
      • 1.1.3.6Sub-Sub-Program: Telecommunications Services Program Management
    • 1.1.4Sub-Program: Cyber and IT Security Services
      • 1.1.4.1 Sub-Sub-Program: IT Environment Protection Services
      • 1.1.4.2Sub-Sub-Program: Identification, Authentication, and Authorization Services
      • 1.1.4.3Sub-Sub-Program: Secure Communication Services
      • 1.1.4.4Sub-Sub-Program: Perimeter Defence, Detection, Response, Recovery and Audit Services
      • 1.1.4.5Sub-Sub-Program: Cyber and IT Security Services Program Management
  • Internal Services

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Operating Environment and Risk Analysis

SSC continues to advance its mandate in the face of numerous challenges, both external and internal. The Department, created out of the largest public sector merger in Canadian history, has continued to maintain and operate legacy IT infrastructure services while simultaneously transforming this aging IT infrastructure in order to provide modern, reliable, secure and cost–effective IT services to federal departments and agencies and the Canadians they serve.

The journey has not been without its challenges as SSC was not created to maintain the status quo; it was created to fundamentally transform how the Government of Canada manages its IT infrastructure.

The magnitude of this challenge cannot be overstated.

The scale, scope and complexity of this plan are ambitious and have few parallels in Canada or abroad. It requires every IT resource the Government of Canada has at its disposal and will continue to require government-wide co-operation, orchestration and synchronization. The transformation of federal IT infrastructure originally included simultaneously consolidating and modernizing more than 50 wide area networks (a network of computers that are located apart from each other), 63 email systems and almost 500 data centres. This task later expanded to include consolidating the procurement of Government of Canada workplace hardware and software and establishing consistent security protocols across government. In addition, the rapid pace at which the IT environment is evolving continues to challenge the organization. As a result, the demand for IT services is growing faster than initially forecast.

This demand, coupled with a $208.7 million budget reduction for 2015–16, caused a significant shortfall in IT investments and therefore affected the overall renewal of government IT infrastructure. For SSC, this meant keeping and maintaining legacy IT infrastructure (such as data centres) much longer than anticipated. It also meant (and continues to mean) taking personnel away from transformation and diverting them to fix or replace failing equipment, which had already reached the end of its useful life. In addition, vendor capacity issues and delays in procurement and project execution have prevented plans and benefits from being realized as quickly as expected.

The Department, like the private sector, also faced (and continues to face) a shortage of qualified IT infrastructure workers. Ongoing attrition and the increased need for personnel at all levels with experience or training in planning, executing and managing large-scale IT transformations has resulted in a dedicated focus on finding ways to attract the right people with the right skills. The Fall 2015 Reports of the Auditor General of Canada noted these and other challenges, which included low levels of customer satisfaction with SSC services and provided helpful recommendations for the Department to adjust its IT transformation planning and execution in order to address these issues.

SSC acted on these recommendations and in 2015–2016, the Department developed several initiatives to strengthen the way it delivers services to its partner organizations, including: developing a Service Management Strategyto identify its vision for delivering service and a framework for measuring performance; updating the online Service Catalogue to include the level of expectations for priority services; undertaking a Customer Satisfaction Survey to determine benchmarks for future improvements in service; and distributing a matrix to SSC and its partner organizations that outlines roles and responsibilities for IT security.

These initiatives have been designed to improve the service SSC provides to its partner organizations, while at the same time allowing the Department to continue conducting a comprehensive review of its plan to consolidate and modernize the Government of Canada IT infrastructure. While work towards this new plan continues, the federal government demonstrated its commitment to creating a modern, transformed and enterprise IT infrastructure by providing additional funds in Budget 2016 to help stabilize critical systems and strengthen cyber security.

SSC faced cyber security threats throughout 2015–2016, including the exposure of new Flash and Windows vulnerabilities and cyber attacks against federal websites by the hacker group Anonymous. The Department responded to these threats by reinforcing legacy IT infrastructure and enhancing cyber and IT security services in order to reinforce government-held information and prevent outages in the delivery of services to Canadians. In addition, SSC further protected Government of Canada IT infrastructure against cyber attacks by proactively providing the Government Operations Centre with 24/7/365 government-wide threat detection and mitigation reports to secure departmental IT infrastructure and Internet platforms.

In advancing its risk management practices, SSC continues to integrate risk management across the Department and its partner organizations. In 2015–2016, SSC launched its first Enterprise IT Risk Analysis, which examined IT risks across the enterprise as a whole. This enterprise-wide approach to identifying risks allows senior management to better understand the IT risks facing SSC and its partner organizations in order to better plan and forecast future requirements.

In addition, steps were also taken to mature SSC’s monitoring and reporting process for risk responses. In 2015–2016, the Department updated its internal Risk Management Policyinstruments and Organizational Risk Profile, which provided greater clarity and guidance for its risk management practices and overarching framework. These activities added to the continuation of risk management training across all regions of Canada, helping to promote a risk–smart culture within SSC.

The following table provides the highlights of SSC’s key operational risks, planned responses to those risks and links to the Department’s programs. The risks below were originally identified in the 2015–16 Report on Plans and Priorities.

This table outlines the Key Risks

Risk	Risk Response Stategy	Link to the Organization’s Program(s)
Financial Management There is a risk concerning the Department’s ability to achieve the self-funding requirement for SSC’s transformation agenda while aligning SSC’s finances with priorities and pressures.	Strengthen the management of departmental expenditures by ensuring reliable and timely financial information that supports budgetary control and effective decision making. Develop a costing framework using a consistent methodology of costing information to allow for better and timely decision-making.	Internal Services
IT Service Delivery There is a risk that the complexity, speed, scale and concurrency of key transformation initiatives (Data Centre Consolidation, Email Transformation Initiative, and Telecommunications Transformation Program) will lead to unforeseen implementation and operational obstacles that will affect overall success of the transformation and ongoing service delivery.	Demonstrate project execution and reporting excellence through sound project management practices and decision-making processes. Continue to optimize security, service, resources, contracts, facilities and assets in the delivery of transformation initiatives. Strengthen the management of SSC infrastructure and services, leveraging IT Service Management processes .	1.1 IT Infrastructure Services
Partnership Management There is a risk that the Department’s delivery of its transformation agenda will face challenges as transformation disrupts established systems.	Develop an IT planning capability for the Government of Canada in collaboration with the Treasury Board of Canada Secretariat (TBS), enterprise business solution providers (e.g. Public Services and Procurement Canada [formerly Public Works and Government Services Canada]) and customers. Strengthen strategic relationships supporting transformation programs, focusing on partner readiness to migrate to government-wide IT infrastructure services. Define and implement a partner satisfaction assessment framework and program, aimed at improving the user experience of government wide IT infrastructure services.	1.1 IT Infrastructure Services
Change Culture There is a risk that change fatigue will negatively impact SSC’s emerging culture and lead to employee disengagement, impede innovation and diminish the quality of service delivery.	Support an innovative and agile culture that focuses on service excellence by: identifying and promoting constructive behaviours; promoting employee engagement and open dialogue across the Department; and analyzing the results of the 2014 Public Service Employee Survey and aligning follow-up activities to strengthen engagement and support.	Internal Services
Cyber Security There is a risk that IT infrastructure under the stewardship of SSC—logical access control, networks, data centres, email systems—may be exploited as a result of a cyber attack, a lack of security awareness training, and/or a failure to address IT security vulnerabilities.	Continue the development and standardization of cyber and IT security services in alignment with Government of Canada policies and standards, including: design and implement security controls for the end-state services being delivered; complete appropriate security assessment and authorization activities; and improve the supply chain integrity process. Initiate enhanced cyber and IT security services, including the delivery of the cyber and IT security framework, security reference architecture, service design documents for the four core security services, and eight operating/technical security standards.	1.1 IT Infrastructure Services Internal Services

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Organizational Priorities

Name of Priority: Demonstrate results and realize savings through the transformation of Government of Canada IT infrastructure services.

Description

The IT infrastructure that supports government programs and services is aging, vulnerable to security risks and inefficient. Renewal of this infrastructure will create savings through lower operating costs, and strengthen security and efficiency by standardizing equipment.

Priority Type^{Footnote 1}: Previously committed

Key Supporting Initiatives

This table outlines the Key Supporting Initiatives

Planned Initiatives	Start Date	End Date	Status	Link to the Organization’s Program(s)
Establish enterprise standards for the Government of Canada IT infrastructure, aligning IT service management to optimize enterprise services and resources.	April 2014	Under reviewFootnote 2	Delayed	1.1.2 Production and Operations Computing Services (Data Centre Services)
Deploy a single email solution.	April 2012	Under review	Delayed	1.1.1 Distributed Computing Services
Continue to develop fully functional purpose-built data centres.	April 2012	Under review	Delayed	1.1.2 Production and Operations Computing Services (Data Centre Services)
Initiate implementation of the Government of Canada network and hosted contact centre service.	April 2012	Under review	Delayed	1.1.3.Telecommuni-cations Services (Data, Voice and Video)
Continue to standardize and expand videoconferencing systems and service delivery.	April 2012	March 2016	Complete	1.1.3.Telecommuni-cations Services (Data, Voice and Video)
Continue implementation of workforce management strategies to support the organization’s transformation activities.	April 2012	Ongoing	On track	Internal Services
Align SSC’s structure, finances and accountabilities with its mandate and priorities.	April 2015	Under review	Delayed	Internal Services
Leverage the ICT sector’s expertise to identify industry best practices and approaches to IT infrastructure transformation.	April 2015	Ongoing	On track	Internal Services

Name of Priority: Secure Government of Canada data and technology assets through enterprise cyber and IT security services.

Description

The increasing frequency and complexity of cyber security attacks pose a threat to the IT infrastructure and continued availability of Government of Canada networks that house data and provide services to Canadians. Infiltration through a cyber attack can lead to loss of information and unauthorized access to sensitive information. Enterprise-wide engagement on cyber security issues is central to reducing risks and responding to attacks in a comprehensive manner.

Priority Type: New

Key Supporting Initiatives

Section II: Expenditure Overview

Actual Expenditures

The difference between the Department’s planned FTE level and the actual FTE figure is influenced by the following factors:

• Even though SSC’s attrition rate has always remained slightly lower than that of the core public service, hiring has not kept pace with departures because of budget pressures. These include savings being removed from SSC’s reference levels before efficiencies were realized, the need to absorb unfunded service growth, the cost of maintaining aging infrastructure longer than planned and the conversion of salary dollars to non-salary dollars to meet commitments. As a result, SSC’s population has been decreasing since the creation of the department.
  
• A portion of SSC’s FTE levels also relies upon resources received through funding arrangements with partner organizations to support various IT projects, and delays in these projects had an impact on funding.

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Budgetary Performance Summary

Budgetary Performance Summary for Program(s) and Internal Services (dollars)

Program(s) and Internal Services	2015–16 Main Estimates	2015–16 Planned Spending	2016–17 Planned Spending	2017–18 Planned Spending	2015–16 Total Authorities Available for Use	2015–16 Actual Spending (authorities used)	2015–16 Actual Spending (authorities used)	2013–14 Actual Spending (authorities used)
Strategic Outcome: Modern, reliable, secure and cost-effective IT infrastructure services to support government priorities and program delivery
IT Infrastructure Services
Gross Expenditures	1,285,297,140	1,285,297,140	1,799,958,368	1,294,025,586	1,860,608,196	1,789,804,880	1,858,089,117	1,860,268,470
Less: Respendable Revenue	(325,000)	(325,000)	(407,093,999)	-	(423,938,645)	(423,938,645)	(393,328,154)	(350,999,820)
Subtotal	1,284,972,140	1,284,972,140	1,392,864,369	1,294,025,586	1,436,669,551	1,365,866,235	1,464,760,963	1,509,268,650
Internal Services
Gross Expenditures	159,071,885	159,071,885	158,390,332	158,237,891	145,037,690	138,577,823	157,620,892	143,969,155
Less: Respendable Revenue	-	-	-	-	(288)	(288)	-	-
Subtotal	159,071,885	159,071,885	158,390,332	158,237,891	145,037,402	138,577,535	157,620,892	143,969,155
Total	1,444,044,025	1,444,044,025	1,551,254,701	1,452,263,477	1,581,706,953	1,504,443,770	1,622,381,855	1,653,237,805

SSC's year-end result (Total Authorities Available for use less Actual Spending) reflects a surplus of $77.3 million, which can be explained by the re-profiling of $34.1 million in funds from 2015–2016 to 2016–2017 for the Carling Campus project (the planned relocation of the Department of National Defence and Canadian Armed Forces headquarters from downtown Ottawa to Kanata, Ontario), as well as delays in other projects and initiatives.

The Department's planned spending reflects the funding approved by TBS to support the departmental Strategic Outcome and Programs.

The majority of the increase of $137.7 million in the 2015−2016 Total Authorities Available for use over the 2015−2016 planned spending is explained by the additional funding received through Supplementary Estimates and TBS Central Votes such as: 2014−2015 Operating and Capital Budget carry forward to 2015−2016 ($71.4 million), the additional funding received for different projects and initiatives ($53.4 million), adjustments with partner organization as a result of the creation of the Department ($0.5 million) and the increase in the employee benefit plan contribution mostly related to the Vote-Netted Revenue (VNR) authority ($12.4 million).

The respendable revenue increase of $423.6 million (Actual Spending less Planned Spending) is attributed to the VNR authority of $410.8 million approved in June 2015 and to an increase of $12.8 million in collected revenues above the authority for standard and optional services and projects with customers.

For Internal Services, the decrease of $14.0 million in the 2015−2016 Total Authorities Available for use over the 2015−2016 planned spending is mainly because of the transfer of funds from Internal Services to IT Infrastructure Services.


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Departmental Spending Trend

Expenditures by Vote

For information on SSC’s organizational voted and statutory expenditures, consult the Public Accounts of Canada 2016.^{Footnote iii}

For the period of 2013–2014, 2014–2015 and 2015–2016, the actual spending represents the actual expenditures as reported in the Public Accounts of Canada.

The decrease in the 2017–2018 and 2018–2019 planned spending from 2016–2017 is primarily because of time-limited projects that do not have ongoing funding.

Alignment of Spending With the Whole-of-Government Framework

Alignment of 2015–2016 Actual Spending With the Whole of Government Framework^{Footnote iv} (dollars)

Total Spending by Spending Area (dollars)

Financial Statements and Financial Statement Highlights

Financial Statements
The Department’s financial statements can be found on SSC’s website^{Footnote v}.

Financial Statement Highlights

The financial highlights presented within this Departmental Performance Report are intended to serve as a general overview of SSC’s Statement of Operations and Departmental Net Financial Position and its Statement of Financial Position. More detailed information is provided in SSC’s 2015–2016 financial statements. These unaudited statements have been prepared using Government of Canada accounting policies, which are based on Canadian public sector accounting standards.

The unaudited financial statements are prepared in accordance with accrual accounting principles and are therefore different from the information published in the Public Accounts of Canada, which are prepared on an appropriation basis. Sections I and II of this report contain financial information based on parliamentary authorities, which reflect cash flow requirements. Items recognized in the Statement of Operations and Departmental Net Financial Position and in the Statement of Financial Position in one year may be funded through parliamentary authorities in prior, current or future years. A reconciliation of net cost of operations to current year authorities used is presented in Note 3 to SSC’s 2015–2016 financial statements on its website.

The tables below illustrate the March 31, 2016 ending balances for each major financial statement grouping, along with the corresponding change from the previous fiscal year.

Condensed Statement of Results (unaudited)
For the Year Ended March 31, 2016 (dollars)

SSC’s total expenses for 2015–2016 were $1,936.6 million, a decrease of $37.9 million over the previous year’s total expenses of $1,974.5 million. In 2015–2016, the salaries and employee benefits represented the largest portion of expenses (32%) at $622.7 million ($652.2 million and 33% in 2014–2015), followed by the telecommunications expenses (25%) at $475.7 million ($453.8 million and 23% in 2014–2015). The salaries and employee benefits decreased by $29.5 million in 2015–2016, mainly explained by the reduction of the number of SSC’s employees as of March 31, 2016 and by the decrease of $8.6 million related to the adjustment for the employee future benefits. The operating expenses (excluding salaries and employee benefits) decreased by $8.4 million in 2015–2016 (from $1,322.3 million in 2014–2015 to $1,313.9 million in 2015–2016).

The Financial Statement's Note 14 segmented information provides detailed information by major object of expenses and by program.

Expand to view the long description: Figure 2 - Expenses Graph

This pie chart shows the Department’s expenses in percentage and in dollars. The graph shows the following expenses for 2015–16: Salaries and employee benefits ($622.7M) represent 32% of expenses, Telecommunications ($475.7M) represent 25% of expenses, Rentals ($262.5M) represent 14% of expenses, Professional and special services ($172.6M) represent 9% of expenses, Amortization ($137.0M) represents 7% of expenses, Machinery and equipment ($121.9M) represents 6% of expenses and Other operating expenses ($144.2M) represent 7% of expenses.

SSC’s total revenues for 2015–2016 were $428.9 million, an increase of $30.8 million over the previous year’s total revenues of $398.1 million. Of these revenues, the majority are respendable revenues related to IT infrastructure services provided to partner organizations and other Government of Canada departments and agencies on a cost-recoverable basis. SSC’s revenues, net of $7.8 million in non-respendable revenues, earned on behalf of government, consist of 99.79% in sale of goods and services and 0.21% in miscellaneous revenues.

Condensed Statement of Financial Position (unaudited)
As at March 31, 2016 (dollars)

Total liabilities were $534.7 million at the end of 2015–16, a decrease of $62.7 million (10%) over the previous year’s total liabilities of $597.4 million. In 2015–16, accounts payable and accrued liabilities represented the largest portion of liabilities (69%) at $370.2 million ($412.5 million and 69% in 2014–15), followed by the lease obligations for tangible capital assets (19%) at $100.4 million ($113.2 million and 19% in 2014–15).

Expand to view the long description: Figure 3 - Liabilities Graph

Total net financial assets were $510.4 million at the end of 2015–2016, an increase of $62.8 million (14%) over the previous year’s total net financial assets of $447.6 million. In 2015–2016, the amount due from the Consolidated Revenue Fund (CRF) represented the largest portion (60%) of the net financial assets at $308.4 million ($353.6 million and 79% in 2014–2015).

Total net financial assets were $510.4 million at the end of 2015–2016, an increase of $62.8 million (14%) over the previous year’s total net financial assets of $447.6 million. In 2015–2016, the amount due from the Consolidated Revenue Fund (CRF) represented the largest portion (60%) of the net financial assets at $308.4 million ($353.6 million and 79% in 2014–2015).

Expand to view the long description: Figure 4 - Net finanacial assests

Total net financial assets were $510.4 million at the end of 2015–2016, an increase of $62.8 million (14%) over the previous year’s total net financial assets of $447.6 million. In 2015–2016, the amount due from the Consolidated Revenue Fund (CRF) represented the largest portion (60%) of the net financial assets at $308.4 million ($353.6 million and 79% in 2014–2015).

Total non-financial assets were $559.6 million at the end of 2015–2016, an increase of $49.5 million (10%) over the previous year’s total non-financial assets of $510.1 million. This increase is explained by an increase of $26.0 million in tangible capital assets (from $494.1 million in 2014–2015 to $520.1 million in 2015–2016) and by an increase of $23.5 million in prepaid expenses (from $16.0 million in 2014–2015 to $39.5 million in 2015–2016. The increase in tangible capital assets is mainly because of new acquisitions of computer hardware, assets under construction and leased capital assets. The increase in prepaid expenses is mostly explained by new contracts related to software licenses and maintenance services to be received after March 31, 2016.

Expand to view the long description: Figure 5 - Non-financial assets

This pie chart shows the Department’s non-financial assets in percentage and in dollars. The graph shows the following non-financial assets for 2014-15: Tangible capital assets ($494.1M) represents 97% of non-financial assets and Prepaid expenses ($16.0M) represents 3% of non-financial assets.

Section III: Analysis of Program(s) and Internal Services

Programs

1.1: IT Infrastructure Services

Description

This program delivers IT infrastructure services to federal government departments to enable and support the management, co-ordination and delivery of government programs to Canadians and the achievement of Government of Canada priorities. The IT infrastructure services consist of four main IT service groups: (a) Distributed Computing, (b) Production and Operations Computing, (c) Telecommunications (Data, Voice and Video) Services, and (d) Cyber and IT Security. This program establishes a centralized common IT infrastructure service leading to consolidation and standardization in the management and delivery of IT services across the mandated partner organizations. This consolidation and standardization of services contributes to greater operational efficiencies and economies of scale resulting in forecasted cost savings, enhanced reliability and security of the IT services, a reduction in the duplication of effort and managerial oversight, and the development of a harmonized response to partner organizations’ business requirements.

Program Performance Analysis and Lessons Learned

The consolidation and modernization of government IT infrastructure services has not advanced as quickly as originally expected because of unfunded growth in service demand, vendor capacity issues and workforce gaps. SSC launched a comprehensive review of its IT Transformation Plan in 2015–2016 to examine these challenges and update the plan’s scope, underlying assumptions and timelines to ensure it becomes sustainable and aligned with Government of Canada priorities and industry best practices. This review will continue in 2016–2017 and includes consultations with employees, industry, private sector experts and Canadians.

As part of this review, SSC is revising its methodology for calculating savings and developing financial benchmarks that will be compared to actual financial results. As requested by the Public Accounts Committee, savings will be reported to Parliament and the public. As first steps in this work, in 2015–2016 SSC developed a consistent costing methodology for IT services, as well as pricing strategies for selected services (myKEY, Wi-Fi and Mainframe).

In 2015–2016, with the goal of identifying areas for improvements in service management and delivery, SSC launched the CSFI, which includes the Customer Satisfaction Questionnaire. SSC collected feedback from all 42 partners (excluding SSC) and established a customer baseline for tracking improvements. These results will be processed in collaboration with partner organizations and used to make the changes that are necessary to improve our services and processes. The CSFI is an example of the efforts SSC has made to improve services and implement recommendations that appeared in the 2015 Fall Reports of the Auditor General of Canada, which reviewed the first two years of SSC’s seven-year plan to modernize the federal government’s IT infrastructure.

To respond quickly and effectively to cyber security and IT incidents, SSC worked with TBS’s Chief Information Officer Branch and SSC’s customers to define and clarify their respective roles and responsibilities. SSC distributed a  Responsibility Assignment Matrix that outlines SSC and customer roles and responsibilities for IT security.

SSC has also reduced the number of breakdowns and outages of critical IT systems. In 2015–2016, the total number of critical incidents decreased by 14 percent, dropping from 322 in 2014–2015 to 257. However, focus on reducing critical incidents has resulted in a rise in the number of non-critical incidents because of the reprioritization of limited resources to address these higher priorities.

Budget 2013 expanded SSC’s mandate by adding the consolidation of government-wide procurement of software and hardware for WTD (e.g. printers, desktop and laptop computers). On the basis of industry feedback, SSC established a four-phase procurement process to establish new supply arrangements. SSC hosted Industry Engagement Days in 2015 with a focus on bulk printing products.

SSC established new procurement vehicles for Data Centre Server and Storage Infrastructure Supply Chain Renewal. Use of these vehicles will achieve savings through volume discounts and standardization of infrastructure.

Performance Results

Internal Services

Description

Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization. These groups are Management and Oversight Services, Communications Services, Legal Services, Human Resources Management Services, Financial Management Services, Information Management Services, Information Technology Services, Real Property Services, Materiel Services, Acquisition Services, and Travel and Other Administrative Services. Internal Services include only those activities and resources that apply across an organization and not those provided to a specific program.

Program Performance Analysis and Lessons Learned

The development of the Transformation Program Benefits Realization Framework is on track. Key performance indicators have been collected for the five priority services (i.e. Email, Data Centres, Telecommunications, WTD, Cyber and IT Security).

As part of the Department’s efforts to modernize and simplify procurement practices, SSC developed a Procure-to-Pay system that electronically manages procurement to payment processes. Furthermore, to better serve its customers and to manage the rising volume of procurement transactions, SSC implemented a business intake model and launched a procurement portal e-store.

SSC provided managers with a suite of financial management reports available on an internal portal.

The Corporate Secretariat Business Process Transformation team received the 2015 SSC Award of Excellence for the development and implementation of a single standard and effective process, smarter tools and better advice in support of the government-wide Red Tape Reduction Action Plan.

SSC’s Office of Audit and Evaluation completed six internal audits and co-ordinated 24 external oversight activities that involved SSC.

Section IV: Supplementary Information

Supporting Information on Lower-Level Programs

Supporting information on lower-level programs is available on Shared Services Canada’s website^{Footnote vi}.

..Supplementary Information Tables

The following supplementary information tables are available on the Departmental Performance Reports, 2015-16 Supplementary Tables website^{Footnote vii}.

• Departmental Sustainable Development Strategy
• Internal Audits and Evaluations
• Response to Parliamentary Committees and External Audits
• Status Report on Transformational and Major Crown Projects

Federal Tax Expenditures

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures annually in the Report of Federal Tax Expenditures^{Footnote viii}. This report also provides detailed background information on tax expenditures, including descriptions, objectives, historical information and references to related federal spending programs. The tax measures presented in this report are the responsibility of the Minister of Finance.

Organizational Contact Information

General inquiries

Please direct your inquiries to: SSC.information-information.SPC@canada.ca

Media inquiries

Please direct your inquiries to: SSC.media-medias.SPC@canada.ca
Media Relations Office: 613-670-1626

Appendix: Definitions

appropriation (crédit):Any authority of Parliament to pay money out of the Consolidated Revenue Fund.

budgetary expenditures (dépenses budgétaires): Operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations.

Departmental Performance Report (rapport ministériel sur le rendement): Reports on an appropriated organization’s actual accomplishments against the plans, priorities and expected results set out in the corresponding Reports on Plans and Priorities. These reports are tabled in Parliament in the fall.

full-time equivalent (équivalent temps plein):A measure of the extent to which an employee represents a full person-year charge against a departmental budget. Full-time equivalents are calculated as a ratio of assigned hours of work to scheduled hours of work. Scheduled hours of work are set out in collective agreements.

Government of Canada outcomes (résultats du gouvernement du Canada): A set of 16 high-level objectives defined for the government as a whole, grouped in four spending areas: economic affairs, social affairs, international affairs and government affairs.

Management, Resources and Results Structure (Structure de la gestion, des ressources et des résultats): A comprehensive framework that consists of an organization’s inventory of programs, resources, results, performance indicators and governance information. Programs and results are depicted in their hierarchical relationship to each other and to the Strategic Outcome(s) to which they contribute. The Management, Resources and Results Structure is developed from the Program Alignment Architecture.

non-budgetary expenditures (dépenses non budgétaires): Net outlays and receipts related to loans, investments and advances, which change the composition of the financial assets of the Government of Canada.

performance (rendement): What an organization did with its resources to achieve its results, how well those results compare to what the organization intended to achieve and how well lessons learned have been identified.

performance indicator (indicateur de rendement): A qualitative or quantitative means of measuring an output or outcome, with the intention of gauging the performance of an organization, program, policy or initiative respecting expected results.

performance reporting (production de rapports sur le rendement): The process of communicating evidence-based performance information. Performance reporting supports decision making, accountability and transparency.

planned spending (dépenses prévues): For Reports on Plans and Priorities (RPP) and Departmental Performance Reports (DPR), planned spending refers to those amounts that receive TBS approval by February 1. Therefore, planned spending may include amounts incremental to planned expenditures presented in the main estimates.

A department is expected to be aware of the authorities that it has sought and received. The determination of planned spending is a departmental responsibility, and departments must be able to defend the expenditure and accrual numbers presented in their RPPs and DPRs.

plans (plans): The articulation of strategic choices, which provides information on how an organization intends to achieve its priorities and associated results. Generally a plan will explain the logic behind the strategies chosen and tend to focus on actions that lead up to the expected result.

priorities (priorités): Plans or projects that an organization has chosen to focus and report on during the planning period. Priorities represent the things that are most important or what must be done first to support the achievement of the desired departmental Strategic Outcome(s).

program (programme): A group of related resource inputs and activities that are managed to meet specific needs and to achieve intended results and that are treated as a budgetary unit.

Program Alignment Architecture (architecture d’alignement des programmes): A structured inventory of an organization’s programs depicting the hierarchical relationship between programs and the departmental Strategic Outcome(s) to which they contribute.

Report on Plans and Priorities (rapport sur les plans et les priorités): Provides information on the plans and expected performance of appropriated organizations over a three-year period. These reports are tabled in Parliament each spring.

results (résultats): An external consequence attributed, in part, to an organization, policy, program or initiative. Results are not within the control of a single organization, policy, program or initiative; instead they are within the area of the organization’s influence.

statutory expenditures (dépenses législatives): Expenditures that Parliament has approved through legislation other than appropriation acts. The legislation sets out the purpose of the expenditures and the terms and conditions under which they may be made.

Strategic Outcome (résultat stratégique): A long-term and enduring benefit to Canadians that is linked to the organization’s mandate, vision and core functions.

sunset program (programme temporisé): A time-limited program that does not have an ongoing funding and policy authority. When the program is set to expire, a decision must be made whether to continue the program. In the case of a renewal, the decision specifies the scope, funding level and duration.

target (cible): A measurable performance or success level that an organization, program or initiative plans to achieve within a specified time period. Targets can be either quantitative or qualitative.

voted expenditures (dépenses votées): Expenditures that Parliament approves annually through an appropriation act. The vote wording becomes the governing conditions under which these expenditures may be made.

Whole-of-government framework (cadre pangouvernemental): Maps the financial contributions of federal organizations receiving appropriations by aligning their programs to a set of 16 government-wide, high-level outcome areas, grouped under four spending areas.

Endnotes

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