Government Operations Committee on Sept. 19th, 2016

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

I have no reason not to believe it, based on the information I've been given and the work being done in the department. I'm every day at the same thing, not just because I want the backlog cleared up: I want employees to get paid for work performed.

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay.

Madam Minister, you have made the point that the Phoenix pay system was a flawed plan inherited from the previous government, but in the end, it was your government that rushed ahead with implementing that flawed plan despite repeated warnings that the system was not ready.

One possibility is that the implementation was rushed so that senior officials could meet deadlines to qualify for performance bonuses. I think you've indicated that performance bonuses will not be paid out this year, but I want to clarify whether top officials who implemented Phoenix might have accrued bonuses that could be paid out at a later date.

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

Thank you for the question, but I have to tell you that my mind has not been focused at all on performance bonuses. That is not where I am when it comes to dealing with this file.

We are determined to fix a broken system, a system that, while we inherited it—I repeat again—is mine to fix. I'm not prepared to say we rushed into it, because I know that I repeatedly asked questions, but the reality is that when the question of if could we go back to the other system was asked, I was told no, because of course you had the 700 compensation advisers who had been let go, you had systems that had been changed, and there was no going back.

I asked the question: can we go back?

[Erin Weir, NDP, Regina—Lewvan, SK]

When you suggest that it wouldn't have been possible to maintain the previous system for a bit longer while these bugs in Phoenix were worked out, are you suggesting that if the government had not gone ahead with implementing phase two of Phoenix, more than 80,000 federal employees would have been paid incorrectly as a result?

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

No. What I'm telling you is that when I asked the question of whether or not we could run two systems, I was told no, that would not work, that we could not run two systems, that we have Phoenix, people are being trained on Phoenix, the system is there, and there was no going back. All of those questions, believe me, were asked when we looked at whether or not—

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay, but it's not a question of going back. It's a question of just slowing things down and maintaining the system that was in place. I think a lot of people, including people in the federal public service, recommended that, yet your government barrelled ahead with the implementation of Phoenix, which has been a disaster.

On the one hand you're acknowledging the problem, but on the other hand, you still seem to be suggesting it was the right decision to go ahead with implementing phase two of Phoenix.

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

I was told that we could not run both systems simultaneously.

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay, so is the person who told you that going to have some accountability?

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

Well, the buck stops with me. I'm the minister responsible—

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay.

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

—and I'm the one who has to fix the system, working with the department. It doesn't matter who told me what. The reality is that all of those questions were asked, and what we have to do now is fix the system so that there are no public service employees going without pay for time worked.

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay.

There have been some questions about the cost of cleaning up the Phoenix mess. I'm not sure that we really have a final tally of what all these pay centres, the compensation to employees, and the lawsuits are going to cost, but there was a figure of $50 million put out, and that included an additional $6 million to IBM for 24/7 monitoring of Phoenix.

What I'm wondering is, what obligations did IBM have under the original contract? Also, why are we now paying IBM more money rather than perhaps expecting IBM to compensate taxpayers for its role in this boondoggle?

[The Chair, Conservative, Tom Lukiwski]

Please give us a very brief answer if that's possible.

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

What IBM is being paid to do now was not part of their original contract. They would not have been paid for that, because it is something new.

Gavin, am I right on that?

[Gavin Liddy, Associate Deputy Minister, Department of Public Works and Government Services]

Yes, you are. That's correct.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

The final seven-minute intervention will go to Mr. Whalen.

[Nick Whalen, Liberal, St. John's East, NL]

Thank you very much, Minister, for coming to join us today.

It's obviously a difficult situation. I've had employees in my office this summer. Part-time employees had difficulty getting their pay. I also had employees who were continuing to receive pay after they stopped working following the winter semester, so there can be problems on both sides of the coin.

As I looked into it, I learned that historically a certain amount of overpay and underpay happens throughout the government system. Can the department provide us some information on what the typical year-over-year overpay and underpay is so we can get a sense of what steady state might look like based on the past four or five years under the previous system?

[Marie Lemay, Deputy Minister, Department of Public Works and Government Services]

I'm not able to provide you with that right away. Maybe in the next hour we'll be able to, if that's okay, when Brigitte will be joining us.

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

We'll get that information to you.

[Nick Whalen, Liberal, St. John's East, NL]

Fair enough.

In addition to the backlog of these priority-three supplemental pay problems up until June 30, I have a real concern that there is a continuing or perhaps an ongoing problem with new supplemental pay requests since June 30 that might be building up. Can the department give us some sense of whether or not supplemental pay that accrued in July has been paid in August or early September, and whether or not a secondary backlog might be developing? What would be the magnitude of those? What would steady state look like in terms of overtime pay errors for 320,000 public servants?

[Marie Lemay]

Thank you for the question.

If we're looking at extra-duty pay, now an employee can actually go into the system and put in their hours, and their managers can approve them, and that doesn't even go through the pay centre. That is now automatic, and they normally get it within eight to 15 days, depending on how long it takes for their managers to approve it, and for the process to take place.

Regarding the second part of your question, there are transactions coming into the pay centre, and we've said all along that we have not reached our full operational capacity. People are still learning at all levels, and we're getting used to the system, so we know we're not processing transactions as quickly as we will when we reach steady state, but we are making progress. As soon as the backlog—the 82,000 employee cases—that we have has been addressed, we will have the satellite units that are there, so that's over 200 compensation advisers ready to help Miramichi to get to our steady state, and we'll be able to process all within service standards.

I hope that answers your question.

[Nick Whalen, Liberal, St. John's East, NL]

Thank you.

Minister, we've heard a lot about training having been the major part of the problem. Do you feel that would have prevented the problem, or are there other causes, such as understaffing during the transition, that really led to the overworking of the employees in Miramichi? Was the phase one period from February to late April perhaps too short a timeline in which to determine whether or not people were getting supplemental pay processed? Was there a problem in the process beyond just the understaffing and the training?

[Judy Foote, Liberal, Bonavista—Burin—Trinity, NL]

It's become pretty obvious that sufficient training was not done. In fact, I spoke with the president of IBM, because I wanted to know what had transpired leading up to Phoenix actually coming on stream. Obviously there's a cost associated with training, depending on the degree of training that you decide to go with, and it was made clear to me that the previous government opted to go with the train-the-trainer model versus actually buying into what IBM had advocated as the amount of training that really needed to take place with Phoenix. It was a real eye-opener for me, given the magnitude of this payroll system involving 300,000 employees, that you would opt for the train-the-trainer model instead of looking to make sure you had as much hands-on training as you possibly could.

I think this again goes to the bottom line of trying to realize savings before you've accomplished what you set out to accomplish. This is why we are finding now that those employees who are working so hard with the right training are doing a really good job; they're really quick studies, but I think the reality is that they weren't given that opportunity when they should have been.

[Nick Whalen, Liberal, St. John's East, NL]

Outside the training of the pay staff themselves, is there a problem with the training of managers or individual employees? Is the use of the self-service model, paying employees to track their own time, really efficient? We don't pay people to do cleaning within the buildings or to deliver all their own mail within buildings in government.

Is paying employees to enter their own time and manage their own pay really an efficiency when you look at the greater productivity associated with...especially high-level employees with high salaries, having them spend time doing this, when perhaps payroll clerks might have been a more efficient way to do it?

[Marie Lemay]

The thinking behind self-serve is that it becomes a much more interactive system, and for the employee at any level, it gives them access quickly to their information, direct entry. I was asked what it does for the future generation of public servants. I think that's actually the type of system that the future generation of public servants will really enjoy, because it gives them access directly. They have the control of how they enter and when they enter some of the information. On that front, I think the self-serve portion is appreciated.

It does require, though, a change in the way we do business. You're quite right; that's the part that I believe, and you've heard the minister say, we've underestimated the impact. In terms of the way to do HR and the change in the way we're going to manage our business, that impact was underestimated. It's part of the reason that we are where we are.