The federal government’s botched Phoenix Pay System has cost taxpayers $711 million in compensation, with costs continuing to climb, according to newly released records.
Blacklock's Reporter says the payments are in addition to reimbursement for thousands of employees who were underpaid or overpaid due to payroll errors.
A Treasury Board briefing note acknowledged ongoing demands from bargaining agents for additional compensation.
“We are aware bargaining agents have requested additional compensation for Phoenix damages,” the 2024 document stated. “We are committed to a continued dialogue with bargaining agents on this issue.”
So far, approximately $711 million has been paid in damages, including $26 million in 2023, with another $16.5 million budgeted for this year. However, officials noted that the final amount could be lower.
Employees affected by the payroll disaster were offered $2,500 in compensation for stress and financial hardship.
An estimated 62% of federal workers experienced payroll errors, leading to multiple audits and parliamentary reviews. The Treasury Board is still processing claims from employees who suffered severe financial consequences, such as eviction or foreclosure.
The Phoenix Pay System was introduced in 2016 with the goal of saving taxpayers $70 million annually by consolidating 46 federal payroll systems. Instead, it malfunctioned, leading to pay errors for approximately 220,000 current and former employees.
Access to Information records revealed that Phoenix was so poorly implemented it miscalculated pay due to decimal errors, incorrectly charged employees for provincial health premiums, and paid some casual workers at rates different from what they were promised.
Despite the widespread failure, no managers were dismissed. The Department of Public Works reported last July that ongoing costs related to Phoenix had reached $3.7 billion, with no final total in sight.
“We saw how that didn’t work,” then-Digital Government Minister Joyce Murray said when asked about holding officials accountable.
She added, “We will always have respect for taxpayer dollars. We also have a great deal of respect for our hardworking public servants. They have had a very difficult time with the pay system over the last few years.”
