Showing posts with label KPMG. Show all posts
Showing posts with label KPMG. Show all posts

Monday, 19 September 2011

A Deputation: Doing Things Right and Doing the Right Things

I was thinking of making a deputation - my last one didn't exactly happen- but after talking to a couple people about the ethical implications I'm deciding against it. If I'm going to write about city hall as a 'citizen journalist' then it's probably better not to blur that line any more.


With that said, sharing a deputation is a useful writing exercise, so like last time, here is what I would say. 



******************
Before I begin I'd like to thank everyone present for participating in this process from Executive Committee and Visiting Councillors to city staff to the hundreds of engaged observers and deputants here today. It may have happened in July, but this kind of tangible expression of civic virtues and values doesn't happen often and it should be noted how special it is.  


The core service review tells us a lot about the priorities that citizens hold for Toronto. In a way, it asks the valuable and important question 'what is your Toronto?'. 


Looking at the report, we get an idea of our values. According to KPMG, the lowest ranking policy priority in their consultation with citizens was 'affordable taxes'. Instead, we had 13,000 survey responses and while some may try to dismiss it as 'not statistically valid' it provides a useful roadmap for a city that values its services. We value transparent and accountable government and meeting the needs of vulnerable people. This sounds like Toronto the good. 


Sadly, the process thus far has not reflected this. 


The process explicitly targeted services to be cut without pairing them with potential revenue sources and the value the services provide for citizens. This assumption fundamentally ignores the wants of the citizenry and reduces the names, faces and needs into abstract budget numbers. This isn't good planning. 


It isn't good planning when we cancel the vehicle registration tax without finding an offset for that revenue, just saying 'oh, we'll find that next year'. 


It isn't good planning when the Mayor's Speaker forbade- forbade- councillors from mentioning this year's budget when they were planning last year's budget with the David Miller surplus. 


It isn't good planning to ignore the needs of citizens and those motivated to be involved in civic affairs as 'usual suspects'. We need more people who regularly care about their city and government. 


And we have it here today. The expression of the values and priorities in the seats in front of you, in the overflow rooms and hallways. It's an expression that Toronto is about more than the bare essentials, that we care to be better as a people and city. It's a sentiment expressed by business management guru Peter Drucker, that "management is about doing things right; leadership is about doing the right things". 


It's the leadership we have here today and had in July with hundreds of Torontonians expressing their voices- practically in unison- that they care when daycare spaces vanish, they care when dental care for the poor goes away and nutrition programs for children are considered gravy. 


From what I've seen, people care about a process that listens to them and those values. They know that that means raising property taxes a reasonable amount and thinking creatively about revenue sources. That's the sacrifice- the leadership- that citizens have acknowledged they are willing to make because they feel it's right, that it makes a city they're proud of.


In these passionate deputations they've expressed their opposition to the flawed and narrow-minded process from KPMG and the mayor. Now it's your turn, councillors. It's your turn to answer the question 'what is your Toronto', show leadership and do the right things. 


I hope you will and I thank you for your time.  

Friday, 16 September 2011

Responding to Ford-KPMG Talking Points

The upcoming Executive Committee meeting on the recommended KPMG service cuts will be well-attended and watched. Questions remain as to whether it will be as dramatic and eventful as the 'Citizen's Filibuster' in July and whether councillors like Jaye Robinson and Michelle Berardinetti will defect and vote against the report. One thing that we do know is the type of arguments Team Ford will employ to further their agenda. In the spirit of CodeBlueTO's  excellent Spacing article on arguments against Waterfront Toronto I've compiled the KPMG list below to provide my own humble bit. Reading some of Matt Elliott's old posts was a great help in this, so a hat tip to Ford for Toronto


1) "Toronto has a massive $774 million deficit. This needs to be solved".
This is an oft-repeated refrain that has been cited by most media sources and officials. 


Toronto does have a deficit, and its starting point was indeed $774 million. As happens each year, Toronto starts with a very high deficit and whittles it down, which Edward Keenan explains nicely at The Grid. The idea that this particular starting point is a 'tsunami' is misleading as it tracks with previous years pretty closely. Matt Elliott, writer of the superlative blog Ford For Toronto put together the nifty chart below:
In fact, $774 million isn't really the number we should be talking about as Elliott explains in that excellent post. Instead, we should conservatively be talking about a $530 million deficit. Other people have pegged the number much lower, such as left-wing councillor Gord Perks and Rob Ford's former Chief of Staff Nick Kouvalis (August 28 on The City) have pointed to a number closer to $300-$450 million (Kouvalis later recanted this on Twitter, oddly claiming he meant this in addition to the starting point). 

$530 million is conservatively the more accurate number we're dealing with at this time and using the $774 million is an effort to increase political leverage to make unpopular cuts. 

2) "We've inherited this mess from the out-of-control Miller regime. We're the only ones willing to talk about the problems we face". 
For all of the promise of accountability and responsibility coming from Team Ford, this is a frequent line. 

As suggested in the chart above, Toronto has endured large annual structural deficits since amalgamation. During the mayoral campaign Ford frequently pointed this out and criticized the Miller administration for only thinking of the year at hand. 

Yet in the first budget for Team Ford, Frances Nunziata- presumably on orders from the mayor's office- refused to allow mention of the 2012 budget. As Sean Meagher pointed out in his Citizen's Filibuster deputation, if Team Ford had planned ahead for the 2012 budget in the previous budget it would have had the lowest deficit starting point in almost a decade. 

But council was forbidden from talking about or planning for this year's budget-that-must-not-be-named. Now that it's here, The Voldemort Budget is-surprise- scary. All of that money from keeping the Vehicle Registration Tax and having an inflation-based property tax increase (which would just maintain levels, as this Spacing article explains) would be enough to pay for all of the KPMG recommended cuts. Even the Christmas bureau. 

David Miller left a $350 million surplus. By refusing to plan for 2012, Team Ford owns this budget and has turned what could have been a very manageable budget-that-must-not-be-named into a Voldemort Budget of heartless cuts.    

3) "Either we do these cuts or we face a 35% property tax increase. Some downtown NDP councillors want to do this, but I don't".
Rob Ford mentioned a few variations of this line of attack in his interview with Jerry Agar

The 35% property tax increase number comes from the Toronto Taxpayers Coalition (tacitly endorsed by Doug Ford, Sue-Ann Levy and Michael Coren, oh my!). The TTC that's not really the TTC based this number on the $22 million generated for every 1% increase in property taxes. Using the faulty $774 million number covered in number one here, you get 35%.

This is a completely unreasonable number. The number excludes any further funding sources for the city (land transfer tax, user fees, dividends from assets etc...), surplus money left over from the previous budget ($88 million) and actual honest-to-goodness efficiencies that departments can find to cut their budget. The number is also politically unfeasible and acts only as a scare tactic. 

Furthermore, no councillor has supported raising property taxes by this amount and I haven't seen any activist, journalist or deputant support it either. 

Saying 'either we make these cuts or raise property taxes 35%' is a disingenuous false dichotomy that uses a false number for cynical politics.

4) "We're being taxed to death in Toronto. This has got to stop". 
Rob Ford has essentially ruled out any property tax increase greater than 2.5% (he wants 2%) and feels taxpayers are unduly burdened. 

Toronto has significantly lower property taxes than comparable Ontario cities. While Toronto has a 0.79% property tax rate, Mississauga's is 0.96%, Ottawa's is 1.25% and Hamilton's is 1.48%. 

Additionally, Toronto offers more services than these cities and pretty efficiently as the KPMG report indicated. Within the KPMG report the lowest ranked policy priority from citizens was 'affordable taxes' (page four), so the idea that this is being demanded by citizens is contradicted by the report the mayor is relying on. 

Lastly, there's a secondary concern in having very low taxes. When the city goes to arbitration- as it soon will with the TTC in a very expensive process- the city will argue that it doesn't have the financial capacity to extend salaries in the manner the union wants. The arbitrator will then say, 'but you have extremely low property taxes compared to your comparables and recently cancelled a tax just granted to you by the province. You clearly have more capacity, and should pay accordingly'.

Toronto is not being taxed to death- far from it. This isn't to say taxes should be at Hamilton rates, but that there is public willingness and an economic argument to raise taxes reasonably. 

5) These aren't really cuts, they're efficiencies. 
Rob Ford said no service cuts. Guaranteed. He promised efficiencies and doggone it, that's what these are. 

While Ford's lead spokesperson acknowledged service cuts in a talking points memo to allies recently, the mayor has refused to do so. In the Jerry Agar interview yesterday, Ford was asked whether cutting 2000 daycare spots was a service cut. His response? "No, it's an efficiency. There are no service cuts." 

Someone on the Toronto subReddit made the appropriate analogy that it would be akin to saying cutting off three of your fingers makes your hand more efficient. This line is utter nonsense. Potentially cancelling the blue night bus? Service cut. Eliminating 2000 daycare spots? Service cut. Reducing snow shoveling, street sweeping, horticulture, getting rid of the Christmas bureau, reducing wheel trans, eliminating libraries or reducing hours? Those are service cuts. 

Importantly, Rob Ford told the National Post's Natalie Alcoba and Chris Selley that closing one library on a Sunday would be a 'major' service cut

Efficiencies are when you have the same service delivered at a lower price or increased services delivered at the same price (or better value, dollar for dollar). That is not the case here.

These aren't really efficiencies, they're cuts. 

6) "There's lots of gravy. Just look at all of these unionized city employees. How come we have more than at the start of amalgamation? We should have less."
This is a relatively new line of attack and the strategy is to position your tax dollars against the disliked unions. 

In 2000, Toronto had 2.4 million citizens and 45,000 employees according to this budget (page 3).   

In 2010, Toronto had 2.77 million people and 46,228 employees according to this city document. Granted, the number of employees has been low at various points- it was 40,000 in 2006- but it's hardly out of control like this claim suggests. 

And it does bring up another Ford campaign pledge, that he wouldn't fire staff but would finance his budgets through a managed 3% attrition rate

This wasn't the 'gravy' Rob Ford promised, in fact he promised to not fire anyone. City employee growth tracks reasonably well with population growth which makes Ford's claim less meaningful. 

7) "The People complaining are just the Usual Suspects, Unionists, Socialists or Jobless. They don't speak for the city."
"There are 2.5 million people in this city and we've heard from about 400 individuals over the process of consultation. Letting them say which programs they would like to keep and which ones they don't want to keep for 2.5 million people, to me that doesn't make sense." -Giorgio Mammoliti to Inside Toronto

While Team Ford simultaneously says that they've done historic consultation, staying up all night listening to people, they also dismiss them out of hand as having unrepresentative voices. 

Aside from the fact that activists, unionists, socialists and the unemployed are also Torontonians who have a valid voice and contribution to make to the discourse, this line of argument is also untrue. Anyone who was there at the Citizen's Filibuster knows that the day was not just remarkable for its length, but the diversity of people and causes who were there. 

Another argument ties in to this one, that 'these people' are just out their to protect their own self-interests. In a way, that's true- they feel invested in their community and value services provided for it. Much like, say, some people might be self-interested and value having a lower property tax rate. After all, in the Habermas vein, that's what politics is about. 

What's really going on with this is an attempt to categorize the opposition into a caricature and devalue that voice so as to ignore it. And really, that's undemocratic.

 This argument ignores the reality of the diversity of people speaking out, is anti-consultation and cheapens the political institutions the mayor's office is supposed to uphold. 

8) "Why are we in the business of running zoos and theatres? It's about wants and needs. When we ask people 'what do you need', it's not running a zoo". 
This argument suggests we need to re-prioritize and have a paradigm shift (ugh, that phrase) in how we think of government. 

This is a somewhat reasonable argument. It's important to re-assess the role of government to make sure it's on track. We should force ourselves to re-think what the status quo could be too. 

However, for that to be done, a simultaneous efficiency and value study has to be conducted to find out what those priorities are. People have to be genuinely asked and listened to for what they need so that subsidized dental care for the poor can be evaluated from both the citizen's and a 'business' perspective. 

This was not done. The scope of the KMPG report was explicitly limited to discovering what could legally be cut and giving limited recommendations. The value the city gets from the services it delivers (the intangible benefits of the arts, say) was not considered. The limited consultation that was conducted was dismissed as 'not statistically valid' by Ford ally Denzil Minnan-Wong. 

Wants and needs cannot be determined until you find the value of each service in consultation with citizens.

9) "We need to run this city like a business. I'm going to do that."
With his experience at Deco Labels, Rob Ford positions himself as the man with the knowledge to get things done at City Hall. 

I'm not going to cast aspersion on Ford's experience at Deco Labels, but I don't think his 'business strategy' is right for the city. 

I work in business too. Businesses conduct thorough cost-benefit analyses to make prudent short and long-term decisions to optimize profit and limit risk appropriately given their profile. That means they invest in themselves and cut sometimes and most of the time they're doing a combination of both. 

However, this mayor is so idelogically opposed to the idea of government that he is unwilling to look at ways for the city to invest in itself. So the argument of how arts funding spurs a multiplier effect of city benefits falls on deaf ears. Good businesses are open-minded, think creatively and plan for contingencies. They look at the market for the cost of debt- interest rates- to see whether they can get capital at cheaper rates than the returns they generate. With interest levels at record lows, cities with business savvy and good AA+ credit ratings like Toronto can see that as an opportunity for wise investment and measured growth.  

Good businesses do not exclusively cut. They grow because they believe in themselves.

If the city must be compared to a business, it's one that should rightly face a shareholder revolt for not finding value. 

10) "This is the City Manager's report, not ours. We're just following staff."
We're just responding to data and acting accordingly. Why are you making this all political?

Ah, the age-old 'we're just following the wishes of staff' argument. It's a great argument because councillors are not really allowed to criticize staff- Joe Mihevc drew some 'ohhhhhs' when he criticized Pennachetti for producing the Waterfront Toronto-TPLC report. 

The thing is, everyone knows staff are influenced by political pressure and the mayor's office in particular. To think otherwise is just naive.

City staff aren't immune to political pressure. 

**********************
Team Ford will give lots of reasons to justify their actions including some of the above. Many of them are demonstrably false or shallow arguments and should be treated accordingly. 


Note: An earlier version of this article stated Matt Blackett wrote the Spacing article with arguments against the proposed Waterfront-TPLC changes. This was written by CodeBlueTO and the article has been edited to reflect this. Apologies for the error and thanks to Matt Elliott for pointing it out. 

Monday, 1 August 2011

Team Ford's Terrible July: A Review

Most people can probably agree July was not Team Ford's best month. But looking back on each day with some excepted for weekends or slow news days, it was exceptionally bad. Bad enough to affirm the most cynical views of what a Rob Ford mayoralty would look like-- filled with gaffes, spite, bad policy-making, juvenile taunts and divisiveness. 

Team Ford's July in all its glory is below:  

July 2: Giorgio Mammoliti videotapes Dyke March and alleges some people unfurled a QuAIA sign.

July 3: Rob Ford conspicuously absent from Pride Parade and any Pride Week event
July 4: Mammoliti says all Pride funding should be withdrawn because of QuAIA appearance

July 5: Former TTC manager David Gunn says TTC planning is heading off a cliff, calls Sheppard subway plan ‘a joke’.

July 6: Sue-Ann Levy furthers the sense there is tension between Team Ford and TTC Chair Karen Stintz by attacking her performance in a Toronto Sun column, suggesting she has to go.

July 8: KPMG releases their first core services report. It concludes 96% of services provided by Public Works and Infrastructure are essential. Other reports will suggest high numbers for essential services and point to libraries, pools, Riverdale and High Park farms, fluoridated water as areas that could legally be cut. 

July 11: Ford ally Denzil Minnan-Wong declares community consultation and surveys statistically invalid, irrelevant. 

July 12: Denzil Minnan-Wong moves up Jarvis bike lane debate by a day in a move that seems designed to avoid bike supporters showing up. They pack the chambers at 2:00 when debate starts anyway. Rob Ford votes against all community grants .
Denzil Minnan-Wong's pitches to cyclists were always awkward
July 13: In addition to voting down Jarvis bike lanes, Team Ford votes to not debate accepting provincial funding for two public health nurses (this includes Ford votes by Mushy Middle councillors Beradinetti, Moeser and Lindsay Luby). Rob Ford also votes against AIDS grants.

In the Toronto Standard, writer Ivor Tossell adds a new word to the Toronto political lexicon, ‘uncompetence’.
July 14: Ford loses a vote on implementing a stop light in a school zone (he was against). His team huddles in response, presumably over how the war on the car has continued.
On the radio, Doug Ford claims that the library system is bloated and that his area has more libraries than Tim Horton’s (there are 39 Tim’s and 13 libraries in Etobicoke).

July 15: Ford does a fact-allergic interview with John Oakley to spin the opposition to the KPMG reports coming at the standing committee meetings.

Marcus Gee, a Ford sympathizer during his campaign and to this point, writes a scathing critique of Ford’s budget numbers and mayoralty in the Globe and Mail.

July 17: Adam Chaleff-Freudenthaler, the co-founder of Fair Elections Toronto, is allegedly threatened by Doug Ford who is one of the councillors his group has an outstanding audit request against. 

July 18: At the Public Works committee, Ford loyalists Mark Grimes, John Parker, David Shiner and Minnan-Wong vote against having the Medical Officer of Health report on what the implementation changes would mean and against comparing the savings in the KPMG report to priorities from the public consultations. 

July 19:  The news that left-leaning councillor Janet Davis was unanimously kicked out of a Civic Appointments meeting hits the media. Giorgio Mammoliti unironically calls her a bully.


July 20: Organized by Critical Mass, over 900 cyclists protest Jarvis bike lane removal by taking over the street.
Photo by Hyedie Hasimoto of bike protestors at City Hall. 
Also today, Fair Elections Toronto loses their audit application for the campaign finances of Giorgio Mammoliti, Doug Ford, James Pasternak, Michael Thompson and three losing candidates.

July 22: The Toronto Star and Globe and Mail report that Team Ford is looking to fire TTC head Gary Webster due to a lack of support for their Sheppard subway plan.

Meanwhile, Ford answers another softball-laced interview, this time from Stephen LeDrew, with misrepresentations and falsities. He then implores Ford Nation to come speak for five minutes at the Executive Committee meeting on July 28. 3 of the 169 speakers go on to support service cuts in the committee meeting.

July 26: Breaking the mainstream news after being posted on Facebook, Rob Ford allegedly gave a fellow driver the finger as she and her six-year-old daughter gave him a Mammolitieque thumbs down for speaking on his cell phone while driving.

More importantly on this day, Mushy Middle councillor Josh Colle essentially admits he was squeezed to vote against Jarvis bike lanes due to a hold Ford put on a development project in his ward. 

Discussing her criticism of potential library closures, Doug Ford engages in a war of words with Margaret Atwood, dismissing her as someone he doesn’t know, wouldn’t recognize on the street and doesn’t have standing to contribute to the debate as she didn’t run for office. 

July 27: Doug Ford ‘clarifies’ his Margaret Atwood comment by saying exactly the opposite of what he originally said.
Doug Ford in media scrum. Globe and Mail photo. 
July 28: Executive Committee Meeting begins at 9:30AM with a vote on limiting speakers’ time from five minutes to three minutes and deciding that the meeting will not be broken up into separate days. 344 people sign up to speak.

July 29: At 7:57AM after a wide array of creative, thoughtful and passionate deputants the Committee votes on moving forward all measures. Ford’s executive, including Mike Del Grande, Giorgio Mammoliti and Denzil Minnan-Wong dismiss the strong opposition as union supporters, a vocal minority and a ‘socialist party’.

July 31: Mercifully, the month finally ends. 
Ford at Executive Committee meeting. Carlos Osorio/Toronto Star


Thursday, 21 July 2011

Lizard Brain Planning

Over on Twitter, City Hall All-Star (or Mongoose, according to Torontoist) Jonathan Goldsbie points out an interesting observation in Toronto Star article, “Road to Privatize TTC Would be Bumpy”. In the article CD Howe Institute analyst Ben Dachis asserts that making the TTC an essential service makes it more difficult to contract out as arbitrators are sympathetic to the group’s status when making decisions.

Of course, this is contrary to inclination of the Ford administration to contract out whatever possible. Isolated as an ideological principle, contracting out city services is fine. You may not agree with it or its underlying vision for the role that government plays in building communities, but it’s an intellectually grounded position that can be discussed. It’s the contradictions, lack of intellectual planning and grounding that make the Ford administration’s logic (or what there is of it) so tough to follow.
Photo by Flickr user chewie2008

The decision to make the TTC an essential service was a curious one in the first place. Mark Towhey, Ford’s top strategy and policy adviser, had argued on his personal blog (link to Steve Munro's commentary, blog post has been deleted) during the campaign that the city should not run the TTC at all. Not that funding arrangements should be different or the province should run it, but that the city could save a lot of money by not offering the service. Plus, it would encourage neighbours to share taxis! Seriously, that was a reason he offered in a since-deleted blog post. Granted, Towhey doesn’t share all of the views of Ford, so the mayor shouldn’t be held to that silliness (although he did hire Towhey).

But to go in completely the opposite direction is something else. The logic behind the TTC being made an essential service went something like this: TTC strikes are disliked and the union is disliked so let’s stop strikes and disempower the union by making it an essential service.

There are problems with this. Dachis published a 2008 study for the CD Howe Institute- considered a conservative leaning organization- that argued making the TTC an essential service is not a definitive way to stop strikes, will lead to higher wage increases ($25M over 3 years) and makes it more difficult to win union concessions in the future despite limits in union negotiation. In other words, none of the aims would be achieved. But those warnings were ignored. Planning was thrown out the window in favour of sticking it to unlikeable TTC Union boss Bob Kinnear right away.

What’s troubling about this- policy considerations aside- is the fact that the Ford administration set their sights on a small short-term goal in making the TTC an essential service that they lost sight of their own team’s goal of making the TTC smaller organization with fewer employees and outsourced services. In other words, they even failed to plan for their own ideological goals.

The lack of planning extends to other important areas of governance. In the 2011 budget deliberations Speaker Frances Nunziata, presumably acting on orders of Ford, forbade councillors from referring to the 2012 budget. Knowing that there would be a 2012 shortfall but wanting to focus on the immediately gratifying Ford tax cuts, the ruling against prudence and planning forced left-leaning councillors to refer to the 2012 budget as the Voldemortesque budget-that-must-not-be-named.

Now that the 2012 budget is topical with the KPMG core service reviews, the planning is equally poor and short-sighted. Even the normally vanilla-opinioned Josh Matlow criticized the framework on his website:

"While I believe it was necessary to review how, and what, services our municipal government delivers, it is clear to me that the review process announced by the mayor's office was done hastily and did not properly take into account the feasibility of the proposals in the consultant's report nor the needs of most Torontonians."   
Lizard Brain Instincts

By conducting a piecemeal review that separates city services from the value they create, the service review fails to provide a wholesale look at how the city can operate better. Instead, it is a knee-jerk reaction to the most immediate desired outcome, in this case to cut off as much government as possible, sort the consequences later. While the policy effect may be different that the TTC essential service argument (reducing vs. preserving city paid employees) the same flawed process and management underlies the decision making. 

It’s a kind of decisions making and governance style that is visceral, where the rhetoric and discourse appeals to our lizard-brain. The underlying philosophy doesn’t even have to be consistent so long as the emotional resonance is. By focusing on emotional, short-term and immediately gratifying outcomes, Team Ford abandons planning, leading everyone to wonder just what could happen next. And it’s that emotional effect, the fear and uncertainty of what might happen, that is one of the few consistent things coming from the administration.