This is a new development in an ongoing multi-stakeholder concerto of concern about both the library and the archives parts of LAC, with the Canadian Historical
One problem with the archives: as LAC head Daniel Caron recently told CAUT in a public letter, the new vision of the national archives is that "LAC’s key role extends only to the management of legal deposit and the preservation of the federal government records." This is a widespread trend in archives. Archives were once seen as largely historical institutions, often staffed by historically-trained personnel. Professional archivists (and non-archivist managers like Caron) now often focus more on their roles as the records manager for the particular institution that they serve. So a banks' archives, or a church's, is its record manager and institutional memory.
Now the federal government's archivists see themselves primarily of the managers of their employer's records. But if the national archives is agnostic about national history and only sees itself managing the papers of the civil service, then who takes on the role of the keeper and collector of the nation's records other than its civil service files?
For an eloquent backgrounder on the archives isue, see "National Archives Blues" by writer and cultural critic Susan Crean from the Literary Review of Canada.