Rising from the ashes on a $B pile of cash
Feds plan to spend $1 billion on maintaining public servant pay system over two years as they try to fix Phoenix issuesThe government has also planned spending on its look into a system to replace Phoenix
The federal government is looking to spend over $1 billion by 2025 on its system for getting public servants their paycheques as it works to fix ongoing issues with the Phoenix program that’s hit thousands with troublesome pay issues in the past several years.
The 2023 federal budget released Tuesday outlines about $1.38 billion in money — $517 million this year and $521 million in 2024-25 — for Public Services and Procurement Canada to keep up with its current staffing level within the federal pay centre to work on pay system transactions.
Seven years since the Phoenix pay system fiasco began, federal public service workers across Canada have dealt with issues such as overpayments and missing payments due to issues with the pay system, a problem that has prompted concern among federal labour unions.
To date, the government has paid at least $700 million in damages, with a number of class-action lawsuits and issues related to the pay system still unresolved. No details were outlined in the federal budget for compensating public servants for damages.
The funding in this year’s budget is also being used to periodically assess the progress of Phoenix generally and address the current backlog within the pay centre.
About a million transactions are managed by the pay centre per year. As of February 2023, Public Services and Procurement was dealing with a backlog of 208,000 unresolved pay transactions. At its peak, the government department faced a backlog of about 380,000 cases in January 2018.
The Public Service Alliance of Canada (PSAC) recently indicated that a major issue workers continue to face is notices from the government that they’ve been overpaid. Last month, the union said an estimated 37,000-plus current and former public service workers were to receive an overpayment letter in the coming months, noting that 10,000 federal public service workers received notices of overpayments last year.
PSAC’s national president, Chris Aylward, previously said that the blame for overpayments rests entirely on the government’s shoulders. The union stated that notices of overpayments can be devastating to workers, as they may struggle to repay the costs due to inflation. It argued that letters are often unclear and provide little details about the overpayment itself.
The days of Phoenix might, however, be on their way out.
According to the budget document, an additional $52 million in funding is being provided to Shared Services Canada to continue work on exploring a potential “next-generation” pay program to replace the Phoenix system.
For the past few years, the government has been looking into what type of system could work for the public service, mainly considering options to move to a program with fewer options for customization. That’s because of the variety of staff within the federal public service and the number of people working under different collective agreements.
The feds are considering Ceridian and its Dayforce system, with testing being done across government departments to see how pay can be better administered for all types of workers, including those doing shift and contract work.
The decision on whether the government will adopt Ceridian’s platform, go in a different direction or maintain its current system has yet to be made.
Funding is also being provided to the Treasury Board Secretariat to continue ensuring, as the core public service employer, that there is “sufficient capacity to oversee human resources, pay and pension matters,” as outlined in the budget.
Feds plan to spend $1 billion on maintaining public servant pay system over two years as they try to fix Phoenix issues