The rush to cut costs, costs more


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OTTAWA — It was, in a nutshell, the understatement of the summer.

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Hey there, time traveller!
This article was published 26/08/2016 (2287 days ago), so information in it may no longer be current.

OTTAWA — It was, in a nutshell, the understatement of the summer.

“Yes, we could have done things differently and, yes, it could have gone better.”

Marie Lemay, deputy minister of public services and procurement, made the statement Wednesday as she gave another technical update on the status of the new Phoenix pay system for federal civil servants.

RON WARD / THE CANADIAN PRESS Public Services Minister Judy Foote speaking to the media in Miramichi, N.B., in July about the problems with the new Phoenix payroll system.

More than 74,000 federal civil servants are still waiting for their proper paycheques. Some were paid too much, some too little and several hundred were not paid at all, for months.

Phoenix is a perfect example of a government’s attempt at efficiency gone horribly, horribly wrong.

The brainchild of the previous Conservative government, the Phoenix is an off-the-shelf computer system from IBM that was to consolidate payments to 300,000 federal employees into one place, a new centre in Miramichi, N.B. The new system was to cost $300 million but would save $70 million a year. It would be user-friendly, take fewer staff to run and modernize a 40-year-old pay system that was rife with its own problems.

Sounds like a good idea in theory.

In practice, it turned out to be an entirely different matter. It has already cost $25 million to try to fix the problems, and the price tag is rising. The current goal is to solve problems for the remaining 74,000 employees by the end of October, but few believe that is a realistic deadline. It has yet to be determined how the government will compensate employees who were forced into debt, fell behind on their rent or mortgage payments or even had to quit in order to find a job that would pay them.

One of the biggest issues seems to be the willingness of those running the show at Public Services and Procurement Canada to ignore the real people behind the statistics. From the day the first 34 departments were transferred to Phoenix in February, the complaints started, but the word from the department was that everything was going swimmingly.

Sure, there were a few issues, but most people were getting paid, so the response was to soldier on. Despite warnings from the unions to slow down, despite pleas from the workers in Miramichi not to expand it so quickly, the government did just that. It added another 67 departments to Phoenix in April. And the problems in the first round were compounded.

In June, Public Services Minister Judy Foote got publicly involved, pledging a temporary pay centre with additional workers in Gatineau, Que., to sort through the backlog of problems. Another one will open in Winnipeg. In July, it was revealed more than 82,000 employees were affected, more than one-quarter of the federal workforce.

Those who weren’t being paid at all were encouraged to apply for emergency pay. Some did. Some were denied. Some received some money, only to find the tax department withheld taxes as if the payment were a bonus. Then when those who got emergency pay finally had their real paycheques start to flow, they were sent pay stubs with every single cent clawed back to repay the emergency fund.

Why? Because that’s how the system was set up.

It all might be comical if it weren’t making life hell for so many people. The stories make your stomach churn. The cancer survivor, already in debt, returning to work after medical leave and not receiving a paycheque. The single parent who couldn’t afford to pay for daycare anymore and had to quit. The student who resorted to eating rice three meals a day because he had no money and who now fears he will lose his job in the student employment program because he can’t afford to pay tuition to stay in school.

One problem leads into the next, and it all could have been prevented if the government had moved more cautiously, taken heed of the warnings, stopped looking at statistics and started looking at the people involved.

It also seems the government took steps to find efficiencies on one side but not another. The federal government is the largest employer in Canada, with more than 300,000 people on the payroll. There are a mind-boggling 80,000 rules and regulations for how to pay them. That’s one rule or regulation for every four employees, all of which have to be learned and understood by both the computer system and the employees managing individual files.

If the federal government truly wants to find efficiencies, maybe it could start there.

Mia Rabson is the Winnipeg Free Press parliamentary bureau chief. Twitter: @miarabson

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