With Phoenix pay system fix potentially costing $1B, union says time to pull the plug

Debi Daviau, president of the Professional Institute of the Public Service of Canada, holds a press conference about the Phoenix pay system in Ottawa on Tuesday Nov. 14, 2017. THE CANADIAN PRESS/Sean Kilpatrick

One of Canada’s largest public sector unions says it’s time for the federal government to pull the plug on the Phoenix pay system and start over, even if that means hundreds of millions of dollars in wasted spending.

Debi Daviau, president of the Professional Institute of the Public Service of Canada, held a news conference in Ottawa on Tuesday, just two days after Public Services and Procurement Minister Carla Qualtrough made waves when she acknowledged in an interview with CTV News that the cost of fixing Phoenix could theoretically top out at over $1 billion.

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Daviau called on Ottawa to stop trying to throw “good money after bad” and turn inward, tasking its existing IT professionals with building a new pay system from scratch based on the latest version of Oracle’s PeopleSoft software.

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“Our members have lost confidence in the promise of fixing Phoenix,” the union president said. “In fact, we asked our members last week if they think Phoenix can be fixed. Almost 90 per cent of them said ‘No.'”

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The PeopleSoft software the union is pushing is, however, also at the heart of Phoenix. It was purchased off the shelf and then repurposed by tech giant IBM to create the government’s new payroll system in early 2016. But Daviau said it’s not the core software that failed, but the configuration and implementation.

“The problem is getting bigger,” Daviau said. “In June, there were less than 300,000 open (pay problem) cases, in October there were over 330,000 open cases … enough is enough.”

Daviau said the union estimates that a new system could be designed and tested by a team of government workers, then rolled out incrementally, within a year. She could not provide an overall estimate of how much that might cost, however, but said in theory, it should only require buying the newest version of PeopleSoft. The government could get dual licensing to continue operating Phoenix until the new system is ready.

The problems with Phoenix began almost as soon as it launched. Qualtrough’s department, which the minister inherited in late August from former public services minister Judy Foote, has spent hundreds of millions trying to get things back on track.

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Meanwhile, tens of thousands of public servants have seen their paycheques delayed or not arriving in their accounts at all. Others have been overpaid, leading to confusion and difficulties at tax time. More than half of public servants are dealing with some sort of issue linked to the beleaguered system.

“Now, I know that it’s never easy for the government to pull the plug on a system that has sucked so much time and money,” Daviau said.

“But at some point, you gotta have the courage to cut your losses and to get the job done correctly. We need a pay system that works.”

A spokesperson for Qualtrough’s office said Tuesday that she is “listening to concerns and issues raised by employees” and will continue trying to fix Phoenix.

“(The department) continues to work with all partners including union leadership to find innovative and efficient solutions to the pay issues.,” added spokesperson Ashley Michnowski. “We called in the Auditor General in order to help better understand the problems. We look forward to that report when it is made public next week.”

Canada’s Senate, meanwhile, has already thrown up its hands and bailed out of Phoenix, putting out a call for proposals to the private sector for its own pay system.

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On Tuesday, Daviau said that was the wrong move and it can’t be replicated across other government departments.

“What the Senate is doing is premature, and maybe a little irresponsible in terms of its need to lead within the public sector,” she said.

“Their solution, which is going potentially to a private-sector provider for their pay, is probably not scalable to the size of the public service. You have to realize you’re dealing with over 300,000 public servants.”

The union says it has communicated its proposal to Treasury Board President Scott Brison and to Qualtrough. They seemed open to considering it, Daviau said.

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