Skip to main content

Peter Wallace, seen in 2013, says in court on Wednesday he felt justified giving Dalton McGuinty’s chief of staff, David Livingston, administrative passwords for computers in the premier’s office because seven other staffers already had that access, establishing precedent.Moe Doiron/The Globe and Mail

Toronto's top bureaucrat, city manager Peter Wallace, is quitting to become the federal government's secretary of the Treasury Board, the latest in a series of senior civil servants to leave the country's largest city.

A former senior Ontario civil servant, Mr. Wallace regularly warned his political masters after replacing the retiring Joe Pennachetti as city manager in 2015 that the city needed to close the yawning gap between its spending plans and its revenues, sometimes using a PowerPoint slide featuring an iceberg in presentations to city council.

Mr. Wallace's departure adds to the number of top city jobs filled with bureaucrats in acting roles.

The city's deputy city manager and chief financial officer, Rob Rossini, announced his retirement last year. Another deputy city manager, John Livey, recently announced his plans to retire in April. Toronto Transit Commission chief executive officer Andy Byford left for the top transit job in New York. And the city's chief planner, Jennifer Keesmaat, also left last year.

"The city manager was in the process of hiring three other managers, now that he's gone, that's in a stall pattern," City Councillor Paula Fletcher said.

"There's so many senior managers in acting positions, is that the best thing for the city, with so many challenges ahead of us?"

A spokesman for Mayor John Tory said the mayor was confident good candidates would be found.

Mr. Wallace came to Toronto after a 32-year career with the province, where he served as cabinet secretary and in other senior roles, including as deputy minister of finance and secretary of Ontario's Treasury Board during the aftermath of the 2008 global financial crisis. He also clashed with the Liberal government at Queen's Park, warning that balancing the books would require significant cuts.

He will now take on a senior role in Ottawa with the Treasury Board, which oversees federal spending and the federal civil service.

In an interview, he said it was a role he could not pass up: "It's a great job. It's the national government. I get to work for the Government of Canada. I get to contribute at the national level."

His departure comes just days after Toronto City Council passed the city's 2018 $11-billion operating budget, developed by Mr. Wallace and his senior city finance officials, which heeded Mr. Tory's demands to keep the increase in the base property-tax rate for homeowners at inflation.

Mr. Wallace said he was proud of his efforts to make the government more efficient, squeezing costs out of departments while trying not to affect the services citizens received.

"I am really frankly proud of the fact that we've been able to hold expenses to a very low rate of growth," he said. "And we were instructed to do that and we've been able to do that without impacting services."

While cabinet secretary, Mr. Wallace played a key role in exposing the scandal around the purging of data related to the cancellation of two proposed gas plants from computers in then-premier Dalton McGuinty's office. He testified at the trial last year that resulted in the conviction of former McGuinty aide David Livingston last month.

At the city, Mr. Wallace told council it needed to decide whether to scale back its multibillion-dollar spending plans, or find new ways of raising revenue, recommending that the city use its powers – and get new ones from Queen's Park – to set up new taxes and levies. Mr. Tory's proposal to seek road-toll revenue would later be quashed by Premier Kathleen Wynne.

Mr. Wallace, who leaves at the end of March, will replace retiring Treasury Board secretary Yaprak Baltacioglu.

One of the city's deputy city managers, Giuliana Carbone, is expected to become Toronto's interim city manager, but her appointment must be approved by council.

Mr. Wallace's ultimate successor must also be approved by council.

Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe