Minister of Public Services and Procurement Carla Qualtrough opens pay centre amid ongoing turmoil
MIRAMICHI, NB—The federal government is trying to hit the reset button on its two-year-old bid to repair and replace the problem-plagued Phoenix pay system.
Federal cabinet minister Carla Qualtrough was dispatched to northeastern New Brunswick, where she officially opened the centralized Public Service Pay Centre, which processes paycheques for 300,000 federal employees in 46 departments.
“We have reason to celebrate the hard work of the people working here in Miramichi,” the public services minister said after a ribbon-cutting ceremony outside the new building, which actually opened for business in January. “They work every day to resolve these problems. We have seen progress, even if it’s not as fast as we would like.”
The feel-good photo-op comes more than two years after the government implemented the IBM-built Phoenix system. The previous Conservative government said Phoenix would save taxpayers more than $70 million annually.
Instead, it has caused so many snafus across the country that the backlog of transactions stood at 625,000 as of March 21. That number is expected to dip only slightly when the latest figures are released later this month, Qualtrough said.
However, a pilot project developed at the Miramichi centre will be rolled out across the country to ensure more timely payments, she added.”This pilot that we have done has reduced the queue in the departments in the pilot project by 24 per cent,” Qualtrough said. “That’s not a small amount.”
Debi Daviau, president of the 55,000-member Professional Institute of the Public Service of Canada, said the so-called “Pay Pods” project is a good idea, but it’s only a Band-Aid solution for a much bigger problem.
“No matter how many resources, and what model is being adopted, the government can never stabilize the system because the software is broken,” the union leader said in an email. “The government should be identifying replacement options immediately, as…PIPSC has been asking on many occasions since 2016.”
Under Phoenix, tens of thousands of civil servants have been underpaid, overpaid or not paid at all for long periods since 2016. The ongoing mess has prompted protests across the country and a class-action lawsuit.
On Thursday, about 800 members of the Public Service Alliance of Canada (PSAC— the country’s largest federal union with 180,00 members—marched to the Toronto office of Finance Minister Bill Morneau, where they staged a noisy rally. In February, Qualtrough issued a public apology on behalf of the government.
“We recognize the burden we’ve placed on employees by not paying them timely and accurately,” she said.
More than half of all federal employees have experienced pay problems since Phoenix was brought online, the government has confirmed. Some federal workers have come forward to say they continue to live in fear of payday, citing the stress and anguish caused by Phoenix.
There have been stories of employees struggling to pay their bills—some lost cars and even homes before the government and unions were made aware of the extent of the problem.
Earlier this year, the Trudeau government committed $16 million over two years to finding a replacement system. However, the government also said it could take another six years to make it work.
Morneau has also earmarked more than $400 million to deal with the backlog, bringing the total allocated to the pay project so far to nearly $1 billion.
The 17 unions representing federal employees have called on Ottawa to pay “damages” to their members, and the government opened the door to compensation in its February budget. Talks with the unions are ongoing.
Though the backlog of problem appears to be shrinking, a significant decline isn’t expected until later this spring, federal officials say. The backlog peaked at 633,000 transactions awaiting processing in late January.
Chris Aylward, who was elected as PSAC’s national president this week, said he hoped Public Services and Procurement Canada will take advantage of the new facility “to repair the workplace culture” for its Miramichi employees. “Compensation advisers are overworked and underappreciated, which is seriously impacting their mental health,” he said.
Lisa Harris, New Brunswick’s seniors minister and a local member of the legislature, described the centre as the community’s “economic lifeline.”
She said the well-paying public service jobs have meant a great deal to a region that found itself in a economic tailspin amid a long-term downturn in the forestry industry and the closure of Canadian Forces Base Chatham in 1996.
“It’s impossible to overstate the importance of the Public Service Pay Centre and the effect that it is having on the economy and social fabric of our beautiful community,” she said.
The mayor of Miramichi, Adam Lordon, was more blunt.
“This is the new hub of our local community,” he said. “The jobs are being filled by people coming home to live in the Miramichi and raise their families—something that only a few years ago may have seemed improbable.”