Phoenix 'disaster' due to government culture of avoiding responsibility: Senate

OTTAWA -- The pay "fiasco" affecting federal government employees was largely the result of a bureaucratic culture of avoiding responsibility that will require closer political oversight before launching similarly complex projects in the future, says a Senate study of the Phoenix pay system.

The system, brought online more than two years ago under the intention of streamlining pay for the government's nearly 300,000 workers and saving taxpayers $70 million per year, has instead cost nearly $1 billion in unforeseen expenses.

The total price tag could reach $2.2 billion by 2023, says a report from the Senate's national finance committee.

The report released Tuesday called on Parliament to become more involved in overseeing planned fixes to Phoenix, and what the government is developing to replace it.

"The Phoenix disaster has revealed a cultural problem within the management of the federal bureaucracy, a problem that we have to address if the government is to successfully undertake complex projects such as this one in the future," said report co-author and committee deputy chair Sen. Andre Pratte.

The report noted that "no one has accepted responsibility for the failure of Phoenix or has been held to account."

But rather than pointing a finger at individual senior bureaucrats for the pay system's failures, the committee blamed in large part a "fundamental management cultural problem within the public service" for the Phoenix fiasco.

"The government needs to move away from a culture that plays down bad news and avoids responsibility, to one that encourages employee engagement, feedback and collaboration," said the report.

The Senate committee's report amounts to more bad news for the public service that has taken a beating on its handling of Phoenix, including a war of words between the federal auditor general and the clerk of the Privy Council.

'A much larger problem'

In May, Michael Ferguson called Phoenix an "incomprehensible failure" resulting from "an obedient culture" in the public service. Weeks later, Privy Council clerk Michael Wernick fired back, accusing Ferguson of "sweeping generalizations" about public servants and calling Phoenix "repairable."

Since its launch in early 2016, the Phoenix system has gotten paycheques wrong for more than half of all federal civil servants working within dozens of government departments and agencies.

The problems, including overpayments, underpayments and at times no payments at all, have impacted some employees more than others and created a backlog of pay issues that topped 600,000 earlier this year. The backlog has inched lower to about 577,000 unresolved files as of late June.

Among its five key recommendations, the committee called on the Trudeau government to set targets for processing outstanding pay requests and to better train the pay advisers whose job it is to help resolve individual pay issues.

It also urged the government to do more to help employees facing financial distress.

For employees affected by Phoenix, and their unions, the Senate report came as no surprise.

Some workers were critical of the findings Tuesday for failing to reprimand individuals for their roles in launching the system despite knowing Phoenix hadn't been properly tested.

Pratte defended the committee's decision to not call individual bureaucrats to testify about their roles in launching Phoenix, arguing the system's failures go beyond a handful of people.

"If we had these three individuals in front of the committee, it would have meant that they were the sole responsible people for the problem, and it isn't (the case)," he said.

"It is obviously a much larger problem than three individuals."

Unions representing federal workers have demanded the government pay damages for the emotional and mental stress caused by Phoenix. Talks earlier this year aimed at achieving a compensation package quickly stalled when government negotiators said they didn't have a mandate to proceed.

"The government must accept responsibility, compensate employees in the form of damages, and put a robust process in place that encourages employee engagement, feedback and collaboration and real consultation with their unions," Chris Aylward, national president of the Public Service Alliance of Canada, said in an email statement.

PSAC has also called for a national public inquiry to more deeply examine what went wrong with Phoenix.