The federal government has contracted ongoing repairs to the failed Phoenix Pay System program to continue for another eleven years, according to records. The bungled software has now cost taxpayers $2.8 billion and counting..“We will need to rely on Phoenix until we are ready to transition to a new pay system,” said a May 30 Department of Public Works briefing note. An existing $108.9 million contract with IBM Canada Ltd. expires in 2023 and has options continuing into 2034, said the note Phoenix IBM And Pay Stabilization Procurement..“The contract contains eleven additional one-year options that can be expected on an as-need basis,” wrote staff. “This contract will provide ongoing services to stabilize the pay system, eliminate the backlog of outstanding pay issues and ensure a smooth transition.”.According to Blacklock's Reporter, cabinet in 2016 launched the Phoenix Pay System on a promise of $70 million a year in taxpayer savings by streamlining 46 separate federal payroll departments dating from the 1970s. New software instead garbled payments for some 220,000 current and former federal employees in what the Auditor General called an “inexplicable failure.”.The Department of Public Works briefing note contained the most detailed cost accounting to date. IBM Canada in 2011 was awarded the original Phoenix contract for $309 million. “There were fifty amendments to this contract for a total value of $545 million,” it said..IBM then received the current repair contract for $108.9 million not including the cost of 11 one-year options. “Additional investments to ensure that public servants are paid accurately and on time total $2.13 billion,” said the briefing note, for a total $2.8 billion. “These investments are critical.”.Ongoing expenses include a separate contract with another consultant, McKinsey & Company, “to streamline processes and standardize work at the Public Service Pay Centre to increase efficiency.” The original McKinsey contract worth $4.9 million in 2020 has since been amended three times to a total $27.7 million..“It’s pretty sad when the government is spending money on consultants to fix the problems created by consultants,” New Democrat MP Gord Johns (Courtenay-Alberni, B.C.) told a March 1 hearing of the Commons government operations committee. Johns called the software program a “debacle.”.“This culture that permeates your government of allowing highly paid consultants to repeatedly change the cost of their work ever upward is not only fiscally irresponsible but it’s an insult to Canadian taxpayers who work hard and play by the rules,” said Johns..“Thank you for sharing your thoughts,” replied Treasury Board President Mona Fortier, adding, “Our government is really committed in providing high quality services to Canadians. We want to at the same time ensure the best value for taxpayers.”
