Phoenix system causes Ottawa to overspend almost $70 million

Feb 7, 2017 | News

Photo courtesy Hindrick S:

Parliament Hill in Ottawa, the seat of the federal government. COURTESY HINDRICK S

By: Elliott Williams

Mismanagement or lack of training could be to blame for the federal government overpaying nearly $70 million to thousands of current and past employees, an expert told Humber News on Tuesday.

The government has reached repayment agreements for one third of the money so far.

“I think there was a mismanagement of the implementation of the whole system,” said Daniel Paré, an associate professor at University of Ottawa. “It would be my hypothesis that there wasn’t enough training.”

More than 26,000 employees have been overpaid by a total of about $68.6 million according to internal documents accessed by CBC/Radio Canada.

“I think it’s an unfortunate situation all around,” said Rodney Nelson, a professor at Carleton University.

“It’s certainly affecting people who aren’t getting paid or are actually getting paid more. Those that are not being paid are certainly in a crisis situation that they’ve had to borrow; some have had to re-mortgage and others are in high credit card debt,” said he said.

“It’s going to take them a long time to get out of that,” Nelson said, adding “the interest rates that they’d be paying on all of that money is a daunting task,” he said.

Pierre Martel, a professor at the University of Ottawa, told Humber News that abandoning the Phoenix pay system is not an option for the government.

“I think they don’t have any option but to fix it. You cannot go back to the old pay system, it was a paper based system,” said Martel.

“We have a new system that was imported, tested and implemented. But it failed to provide an adequate solution to the old pay system. I think they’ll have to fix it and probably eventually, conduct a thorough evaluation of what went wrongIs,” he said.

“Is it a question of hardware, software, building more redundancy in the system, or training?”

Paré said that if the government wanted to replace the Phoenix system, it would have to decide if it’s worth it to make a switch.

“The question becomes, how much has been invested into this system? If it’s sufficiently messed up, cut the losses and do something else, but the same sort of problems could arrive in a Phoenix System 2.0 type of thing,” said Paré.

“What’s not clear to me is how much of the problem is directly related to the system itself, versus one that’s linked to issues around the management and use of the system. On the one hand the system was promoted early on as a solution over what was being used before, which may be true in certain regards,” he said.

“But all of the potential benefits it may have had aren’t realized if your staff is not sufficiently trained and you don’t have the right sort of support or infrastructure in place to maintain and deal with the system”