Public Accounts Committee on May 6th, 2026

[Arianne Reza]

I think the issue.... The problematique has been that running the two systems concurrently is an extremely difficult position. We don't know if we're going to run it for two years or three years, but what we've done is to say that we're going to work in waves. As you referred to, we're going to start with a little baby department. We're going to test it out, and then we're going to bring on bigger departments like Shared Services and PSPC, which is close to 20,000, just to have a sense of how we manage. We're going to continue to run both systems concurrently for a period of time that has yet to be defined.

Yes, we decided that what we had anticipated.... We can't continue to run for three years. Nothing was really eliminated. We will do a lot more testing, such as user acceptance testing, the system testing for Dayforce and the technical feasibility concurrently. We'll be running teams doing that, as opposed to sequentially, as we continue to work on the business role optimization.

Kim, did you want to add anything?

[Kim Steele]

The schedule that is referred to was a very early schedule that we put together: How are we going to actually deploy this new solution?

We put an initial schedule together. That was almost two years ago. As we've worked through some of the risks and looked at the processes, we've continued to adjust the schedule, and we will continue to do so. If we learn after our initial few departments that we're going to need maybe a bit more time and that maybe we need to adjust the next wave of departments, we will do so.

Again, as Vidya was mentioning, it's a bit of an agile approach. I don't necessarily like using the word “agile”, but it's thinking of this as really iterative. As we learn, we will continue to adjust. I call the plan an evergreen plan. If something needs to change, we will make the changes. Maybe we can go faster. That's another alternative if things go well.

[Arianne Reza]

Or maybe we can go slower....

I also think that what is not always well understood is that the current system is an on-premises system. Every time we have to update the software to pay people, it's a heavy lift. That is then pulling away resources from other things, like getting ready for Dayforce. The longer we maintain the system, it's not just about, let's say, duplication of resources or inefficiencies. It's a tremendous technical lift to maintain it on premises, on site. There's also the security. That's also another risk that we have to balance.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

That affects the backlog...?

[Arianne Reza]

I don't think it impacts on the backlog, because there are different kinds of skill sets or technical teams. Whoever is bringing Dayforce on board, working in that cloud environment, in that kind of application layer, they are also the ones who will be sunsetting the more technical transfer of software.

Kim, perhaps you'd like to describe what it's like setting up MyGCHR, because we're talking about pay. As we've also spoken about, on the HR systems that feed into it, we're going to go from I think 30 or 40 of them down to one, to get ready for Dayforce. Maybe you could describe that. That is a big lift going on concurrently, and it's where most of our efforts are.

[Kim Steele]

Right now, today, across the Government of Canada, there are about 30 separate, different HR systems. The main one is MyGCHR. By the end of this fiscal year, PSPC will have responsibility and management for 80% of those systems. All of those systems are on a product called PeopleSoft. What that will allow us to do is continue to increase that standardization in advance of going to Dayforce.

If there are HR processes that we want employees or managers to start thinking about—that early culture change—we can implement now, before they move. The other piece that it will allow us to do is.... We've talked a lot about data and clean data. We know that there are data issues within our environment. With having all of those 80 organizations, we will be able to help those organizations clean up the data in advance of moving to Dayforce. When there's a data issue, it doesn't always result in a case, but it can. The cleaner we are, the better off we are going to be from a data perspective.

[Arianne Reza]

Here's a simple example. I want to get it in under the clock.

All those HR systems that feed pay all have a different date format. You can say, well, that's easy, go back in and recode it and fix it, but those are all legacy systems across the Government of Canada. It's hard to go in and fix the date. They may need it in that date format for something else. A lot of Phoenix issues were caused by start dates not being consistent across the system when it hit pay. Those are things that we still deal with on a day-to-day basis.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

It seems like a lot—so many HR systems down to one. Are you sure it will work?

[Arianne Reza]

We know that the current system doesn't work, is inconsistent and isn't serving employees. If we can't pay our employees and be able to do it in an accurate way, they can't deliver services to Canadians very well. I think that this testing we've done on the feasibility—the viability—of Dayforce and the technical testing suggest a very strong chance and a high rate of success.

[The Chair, Conservative, John Williamson]

Thank you very much. That is the time.

Mr. Lemire, you have the floor for two and a half minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Mr. Chair

Thank you again, Ms. Reza.

Obviously, our role is to ask questions. Thank you for participating.

You awarded a $29 million contract to the McKinsey firm, from 2020 to 2023, to streamline processes and standardize the pay centre operations. Yet in her audit, the Auditor General clearly points out that the objectives of the pay streamlining process haven't been achieved.

How do you justify the contract awarded to the McKinsey firm?

Couldn't public servants have done something themselves, without turning to outside expertise? We could have relied on the public service's in‑house expertise.

[Arianne Reza]

In the case of this contract, I think that we've made considerable use of this firm's expertise and that we can show the value of the company and what it brought to the table. I think that this is worth noting, because we asked ourselves the same questions. We awarded this contract. We need to see what we received and what the deliverables were.

I'll turn to Ms. Steele—

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Can you perhaps show us this in writing as well, along with the other items?

[Arianne Reza]

Yes, but can we let Ms. Steele talk more about it?

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Yes, certainly.

[Arianne Reza]

Ms. Steele, go ahead.

[Kim Steele]

At that point, at the pay centre, each compensation officer had various processes. We contracted the McKinsey firm because we wanted to standardize the processes for all compensation advisers. By doing so, we've certainly seen an improvement in the work and in accuracy.

We tracked it. We measured it. We could see the improvements over time.

That's why we extended the contract with the McKinsey firm.

There was definitely value for that.

In terms of the Dayforce system, the compensation advisers' work will change. However, we'll use the same practices to ensure consistency throughout the Government of Canada.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you.

According to the 2025‑26 departmental plan, 80,000 employees encountered potential pay errors at the pay centre.

Your departmental plan calls for the end of additional funding to stabilize pay‑related activities and to reduce the backlog of problem cases. The funding also targeted the human resources and pay transformation project. This will cut spending by $1.4 billion. However, a backlog remains.

Are we to understand that you plan to eliminate this backlog by the end of the year? Is that your deadline?

[Arianne Reza]

Are you talking about the target of 88,000 cases?

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Yes, exactly.

[Arianne Reza]

We want to clear this backlog of 88,000 cases by the end of the fiscal year. We want to clear it to ensure the transition to Dayforce without any backlog of old cases.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Ms. Reza.

[The Chair, Conservative, John Williamson]

Thank you, Mr. Lemire.

Mr. Deltell, you have the floor for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you, Mr. Chair.

First, Ms. Hogan, thank you for your remarks. You were personally a victim of Phoenix. Thank you for bringing this to our attention.

Is everything back to normal?

[Karen Hogan]

I said that I had been auditing Phoenix since 2016. I never had an issue with my pay.

At the Office of the Auditor General of Canada, we have our own compensation officers and we provide the information to Phoenix. I've been fortunate enough to not encounter any issues with my pay. However, I spent a decade auditing the system.