AG wags finger at Liberals
Cost to fix Phoenix pay system to surpass $540 million, auditor general says
OTTAWA — The federal government’s chronic salary struggles will take more time and more dollars than the three years and $540 million projected to fix the snafu-stricken Phoenix public service pay system, the auditor general warned Tuesday — an escalating “fiasco” that the governing Liberals laid squarely at the feet of their Conservative predecessors.
Auditor General Michael Ferguson even went so far as to warn that the government may be “in a similar situation” to Australia, where a comparable problem has already cost more than $1.2 billion over the last eight years and still isn’t completely fixed.
Ferguson’s review of the disastrous Phoenix pay system detailed just how many and how often public servants are either being overpaid and underpaid, how badly federal officials gauged the size and the scope of the problem, and how the government under-reported the number of outstanding pay problems even as issues grew.
In all, there were 150,000 employees with pay problems that needed correcting at the start of summer, and a value of over $520 million worth of mistakes.
The Liberals will provide a full and detailed cost estimate to fix the system, but not until next May, with plans to finalize by next month a preliminary road map of dozens of projects aimed at fixing Phoenix.
When asked whether scrapping the system would make financial sense, Ferguson wasn’t convinced, noting the pay software alternatives that would be available today aren’t all that different than the one the government bought.
“If they started all over again, it’s hard to see how they would actually end up in a better situation,” Ferguson said. “Their only real option is to try and resolve the problem within the system as it exists.”
The problems with Phoenix stood out among all the issues Ferguson found the government needed to right in his latest batch of audits. Among the audit findings:
— Callers to the Canada Revenue Agency got the wrong answer to questions 30 per cent of the time, above the 6.5 per cent error rate the agency publicly reports — and that’s only when they were able to actually get through to an employee; only 30 per cent of calls placed by auditors were connected.
— Immigration, Refugees and Citizenship Canada didn’t monitor whether Syrian refugees were being properly integrated into Canadian society, including basic information such as how many children were enrolled in schools.
— Health Canada couldn’t say whether its oral health program for First Nations and Inuit children helped in any way.
— Female offenders weren’t getting the rehabilitation they needed, especially those with mental illnesses; some prisoners with severe impairments or at risk of suicide continue to be held for observation in segregation cells, against the advice of experts.
— Cadets at Royal Military College were academically challenged, but the school didn’t ensure they learned proper military conduct, ethics or adequate leadership skills.
Combined, the audits amount to what Ferguson describes as a bureaucratic focus inward, rather than thinking about the people they are there to serve. It’s a message Ferguson has delivered before, but the government has yet to hear, he said.
That message appeared to ring loudest in Ferguson’s review of Phoenix, which the Liberals themselves requested last year.
The report says the government has set aside a lot of time, money and staff to deal with Phoenix, but it hasn’t tackled the underlying causes or developed a long-term sustainable solution.
“Unacceptable just doesn’t capture the seriousness of this issue,” Ferguson said. “This has to be the government’s main priority to get this resolved, because it is touching so many of the civil servants and they need to get this right.”
The IBM-designed Phoenix system was supposed to save $70 million a year by modernizing, consolidating and centralizing pay processing.
Instead, the government has re-hired hundred of experts to deal with a relentless barrage of pay problems. The Senate has pulled out of Phoenix, and departments and agencies have had to implement workarounds to make sure employees get paid.
Statistics Canada, for instance, kept its old pay system in place for the army of temporary workers hired for the 2016 census.
Ferguson only looked at what happened since the Liberals took office. An audit about what went wrong in the lead-up will be released in May.