Ottawa invests another $140M in Phoenix pay problem

The Public Service Pay Centre is shown in Miramichi, N.B., on Wednesday, July 27, 2016.
The Public Service Pay Centre is shown in Miramichi, N.B., on Wednesday, July 27, 2016. Ron Ward / The Canadian Press

The federal government is injecting an additional $142 million into the ongoing effort to fix the beleaguered Phoenix pay system.

“We are committed to applying the necessary resources to fix the problem,” said Steven MacKinnon, parliamentary secretary to Public Services and Procurement Minister Judy Foote, on Wednesday.

The new money is on top of the $70 million per year, over the next two years, that the federal government is leaving in departmental budgets. If Phoenix had worked as intended when it launched in early 2016, it should have saved $70 million per year, according to officials in Foote’s office. But given the ongoing problems, that money is now being used up.

READ MORE: One year and millions of dollars later, the ‘Phoenix fiasco’ continues

Employees who have experienced issues with their tax return this spring are also being offered $200 each to help cover costs associated with those problems, like hiring a tax adviser to help them file.

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Finally, the government has already dedicated at least another $50 million over the last year to patchwork hiring and capacity-building at pay centres across the country. Public servants who have lost money on things like late mortgage payments due to missed paycheques are being compensated by Ottawa on a case-by-case basis.

WATCH: Phoenix pay problems will wipe out $140-million in savings

Click to play video: 'Phoenix pay problems will wipe out $140-million in savings' Phoenix pay problems will wipe out $140-million in savings
Phoenix pay problems will wipe out $140-million in savings – Apr 27, 2017

The Liberals are laying the blame for Phoenix’s issues directly at the feet of the previous Conservative government.

MacKinnon alleged Wednesday that hundreds of staffing cuts ahead of the launch set it up to fail and that the problems experienced since have been largely due to a lack of manpower.

The Conservatives, faced with those accusations, have argued that the Liberal government could have foreseen the problems and delayed bringing Phoenix online in February 2016.

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“It is extremely disappointing that the Liberals are still more focused on blaming others for their mistakes, than actually fixing the problem,” said Kelly McCauley, the Conservative deputy procurement critic.

READ MORE: $4.8M in performance pay awarded in department responsible for Phoenix pay system

“If the government had legitimate concerns about staffing levels, they shouldn’t have waited almost two years to take action. The Liberals’ lack of action and constant excuses are extremely offensive to employees who are on the verge of losing their homes, being forced to postpone their educations, or going into debt because they are not being paid properly.”

According to MacKinnon, the new cash announced this week will be used to hire more staff at a pay processing centre in New Brunswick, keep satellite offices open until the end of 2017 and hire additional new staff to handle processing of upcoming collective agreements.

“We have no choice but to make this system a success, and we accept that responsibility,” he said.

In late April, Prime Minister Justin Trudeau announced that the government was setting up a special working group to tackle Phoenix, led by Public Safety Minister Ralph Goodale.

MacKinnon is part of that group.

Phoenix has been a major source of frustration for federal public servants for over a year. Thousands have been overpaid, underpaid or not paid at all as officials have worked to try to diminish the backlog of files.

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The boondoggle has now cost the government hundreds of millions of dollars, but MacKinnon did not provide a precise figure on Wednesday.

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