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Fixing Phoenix payroll problems cost Ottawa $5.1-billion, says federal official

The Globe and Mail
(5 months ago)
Kyle Duggan
Canada

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Alex Benay, associate deputy minister at Public Services and Procurement Canada, stated that fixing the Phoenix payroll system's problems has cost Canadian taxpayers over $5.1 billion. Ottawa will continue to incur extra costs by running Phoenix in parallel with its replacement, Dayforce, to avoid a 'big bang' deployment that caused the initial Phoenix failures. The Dayforce contract is for ten years, worth $350.6 million, with a possible 20-year extension. Parallel testing for Dayforce will begin next year, with Shared Services Canada and Public Services Procurement Canada being the first departments to adopt it. The original Phoenix system, designed to cut costs, was implemented in 2012 by IBM for $274 million but failed due to lack of oversight, leading to nearly a decade of payroll errors.

Trending
  1. 1 2009: Phoenix origins date back
  2. 2 2012: IBM implements Phoenix for $274 million
  3. 3 Nearly a decade: Public service payroll errors and lawsuits due to Phoenix
  4. 4 June 11: Ottawa awards ten-year contract to Dayforce
  5. 5 Next year: Parallel testing of Dayforce begins
  6. 6 Shared Services Canada and Public Services Procurement Canada to be first departments to adopt Dayforce
  • Over $5.1 billion in taxpayer money spent on fixing Phoenix
  • Continued extra costs due to running two payroll systems
  • Phased rollout of Dayforce to minimize disruption
  • Public servants experienced payroll errors for nearly a decade
What: Fixing the Phoenix payroll system's problems has cost Canadian taxpayers over $5.1 billion, and Ottawa will continue to run it in parallel with its replacement, Dayforce.
When: Costs incurred over nearly a decade; Dayforce contract awarded June 11; parallel testing starts next year.
Where: Ottawa, Canada (federal government operations).
Why: To rectify widespread payroll errors caused by the Phoenix system, ensure public servants are paid correctly, and transition to a new system (Dayforce) without repeating past mistakes.
How: By processing backlogs, running two payroll platforms concurrently, and implementing a phased rollout of the new Dayforce system.

People

Alex BenayJullian PaquinCatherine Morrison

Organizations

Public Services and Procurement CanadaDayforceIBMShared Services Canada

Locations

Ottawa

Locations

Canada Ottawa Ottawa Capital Region

Alex Benay, associate deputy minister at Public Services and Procurement Canada, stated that fixing the Phoenix payroll system's problems has cost Canadian taxpayers over $5.1 billion. Ottawa will continue to incur extra costs by running Phoenix in parallel with its replacement, Dayforce, to avoid a 'big bang' deployment that caused the initial Phoenix failures. The Dayforce contract is for ten years, worth $350.6 million, with a possible 20-year extension. Parallel testing for Dayforce will begin next year, with Shared Services Canada and Public Services Procurement Canada being the first departments to adopt it. The original Phoenix system, designed to cut costs, was implemented in 2012 by IBM for $274 million but failed due to lack of oversight, leading to nearly a decade of payroll errors.