Madam Speaker, I will be sharing my time with my colleague from Miramichi—Grand Lake.
I am pleased to have this opportunity to participate in the debate on the motion put forward by the hon. member for Jonquière.
First let me say that pay issues are unacceptable and we are deeply sorry for the hardship being felt by public servants and their families. Fixing Phoenix is our government's top priority.
Public Services and Procurement Canada is responsible for administering the pay of more than 290,000 federal employees in more than 100 departments, agencies, and organizations that make up the federal public service. However, a number of years ago, it had become clear that the federal government's then 40-year-old pay system was inefficient and at risk of failing.
In 2008, a House of Commons government operations committee report recommended support for pay modernization. In 2009, the previous Conservative government initiated plans for transforming pay service administration by acquiring a PeopleSoft-based payroll system from IBM, and consolidating front-line pay services from across government to a new public service pay centre in Miramichi, New Brunswick. The goal of the project was to attain a functioning, customized, off-the-shelf pay system that would improve productivity and save money. Obviously, we failed to achieve these objectives.
Although PSPC, other departments, and IBM spent six years preparing for the deployment of Phoenix, we have learned some painful lessons about critical errors, false savings, and miscalculations. We now know that the original planning for this major transformation project failed to consider its full scope and complexity. In fact, the Harper government removed a key functionality, such as acting pay modules, and opted for a cheaper training option. Critical linkages between pay and associated HR processes and systems were not properly understood. Technology was stripped of important functionality, and training and change management were ineffective and insufficient. As well, important experiences in Australia, although different from our situation, were not carefully studied to inform decision-making.
Shortly after the full rollout of Phoenix, in February 2016, some pay problems were reported, but they were taken to be one-off issues related to the launch. However, by June 2016, it became apparent that there were serious problems. The increasing number of pay issues outstripped our capacity to respond. It must be said that this capacity had been significantly reduced when the Harper government cut more than 700 pay positions as part of its consolidation of compensation staff in Miramichi ahead of the launch of Phoenix.
As an initial response, the department hired additional staff in Miramichi, established satellite pay offices across the country staffed by more than 250 advisers, and opened a client contact centre to handle employees calls for assistance. Although pay problems continue to be reported, these measures helped reduce the occurrence of the most serious pay problems, namely employees receiving no pay at all, and reduced wait times for pay transactions related to parental leave and disability leave, the top priorities identified by the unions.
As efforts were under way to manage ongoing pay issues, we also examined the root causes of problems and the need for solutions. Two important realities emerged. First, because HR processes are inseparably linked to employee pay, it was essential to take an integrated HR and pay approach in addressing these issues. Second, it was clear that Public Services and Procurement Canada alone could not identify and implement solutions. We needed to take a whole-of-government approach, which is why the Prime Minister established a working group of ministers last spring. Last November, the Minister of Public Services and Procurement and the President of the Treasury Board announced a string of measures designed to bring the pay system to a point of stability and, in the short term, reduce wait times and late transactions for missing pay.
These measures in essence represent the foundation of the HR-to-pay integrated plan, which responds to the Auditor General's fall report and fully aligns with his recommendations. They also reflect lessons learned as outlined in the independent report prepared by Goss Gilroy.
Validated by employees, unions and departments, the measures are grouped within four broad areas.
First, we have strengthened accountability and informed decision-making. A joint PSPC-Treasury Board Secretariat team is now leading the overall stabilization effort, both at the pay centre and across the government. As part of our focus on accountability, we are committed to transparency. We provide all departments and agencies with monthly dashboards to track our progress, and we are improving our performance measurement reporting.
The second area of action is improving processes and technology. Pay processes and human resources systems are inextricably linked, and technical conflicts between Phoenix and the patchwork of 32 HR systems across government have contributed to slowdowns. Therefore, we need a comprehensive approach that covers all aspects of the HR-to-pay spectrum, and includes all departments and agencies. In addition to technology, I am pleased that Public Services and Procurement Canada is looking at how work is organized to become more efficient. The Miramichi pay centre has piloted a new approach that organizes compensation experts into pods that specialize in specific departments or transaction types. Early results are promising in terms of helping reduce the backlog of transactions.
Third, we are increasing capacity and service. We are adding more pay staff at the pay centre to address the backlog, and we are making improvements to our call centre, where agents will have access to Phoenix and be able to provide employees with more information about their issues.
Last, we are ensuring strong engagement and partnership at every level. Union-management committees meet regularly to share information and discuss the issues. Additional mandatory training on best practices, roles and responsibilities, and how to prevent pay delays is now available online to employees and managers.
We promised to keep employees up to date on progress toward resolving pay issues. We release a monthly dashboard that shows how many transactions are pending at the pay centre. As everyone knows, the 21 collective agreements the government negotiated last year only complicated things. Many of those agreements had expired years before. Calculating several years' worth of back pay is complex and takes time. Pay advisors have to dig through the old pay system to find the original data.
We also have staff dedicated to dealing with overpayments to ensure that employees get accurate T4s for tax time. We are also taking steps to spare employees financial complications due to overpayments. Once those priorities have been dealt with, we will move on to processing the backlog more quickly.
Many people are wondering why we do not simply give up on Phoenix in favour of a new pay system.
A new pay system that can handle the complexity of the public service payroll would take years to develop. Let us not forget that we have to keep paying some 300,000 public servants. Although our immediate priority is to stabilize Phoenix so that accurate paycheques are issued on time, I applaud the minister's openness to exploring other long-term solutions that will provide public servants with a reliable, sustainable pay system.
We apologize to the many public servants who have suffered from pay issues. We are doing everything we can, as quickly as we can, to put an end to their frustration. To be clear, there is no quick fix. However, we will make steady progress until those who are missing pay receive it.
As we proceed, we are grateful to the dedicated employees at the pay centre in Miramichi, at the satellite offices, and those across the country who are working hard to help ensure their public service colleagues receive the pay they have earned.