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'ERRORS' ON PAYROLL COST GOVT $120M: 'Some had salary paid for decades without records'

Wed, Jul 26th 2023, 08:30 AM
Finance Politics Tribune Stories

PAYROLL errors could be costing the government as much as $120m a year, Financial Secretary Simon Wilson said yesterday.

He said some employees received a salary for decades even though the government could not account for them or their work. It is the kind of irregularity he hopes to solve with a new digital system.
#The Ministry of Finance hosted a training workshop at the National Training Agency yesterday to introduce finance officers to the Oracle ERP Fusion system.
#“Our payroll accounts for 60 per cent of the government’s budget,” Mr Wilson told reporters after the event’s opening ceremony. “And if we have an error rate of 10 per cent, that’s roughly $120m. Those small errors, overpayments or underpayments and so forth, if you minimise those errors, you can have tremendous savings from the government.”
# Mr Wilson said all employees would be captured in the new system, preventing cases of people getting a salary under dubious circumstances.
# “Everyone knows of the employees who get lost in the system,” he said. “In the Family Islands, they work for local government, they work for the school board, but they are hired irregularly, i.e., they’re not in the pay sheet, they’re paid by some other mechanism or some other means.
# “Every employee is going to be captured in this system. That is for us critical cuz we assume, sometimes wrongly, that we know of every employee, that we know the details of every employee. But every year, we find instances where we do not know an employee existed or was being paid or has been paid by the government or the ministry.
# “I know from my own experience in the Ministry of Finance we had employees in Andros who we paid for 40 years, every month, employees of the Ministry of Finance. We don’t know what he did, never did an ACR of those employees, but they were paid every month, and they retired.
# “And what they did when they retired? They took a flight and come up to the Ministry of Finance and said I retired, where is my gratuity? And we had no answer. We checked their records and, yes, surely enough we paid them from 1974 up until 2014, every month, but we had no record.
# “And we have too much instances like that and persons go undetected and then we have to go through this long, arduous process of trying to regularise them.”
# Mr Wilson said the last time the ministry tried to modernise the accounting and financial management system, success was limited because of insufficient support from workers. 
# “We cannot succeed unless there is buy-in from finance and accounts officers,” he said. “We’ve done this before, with JD Edwards, which we purchased at great cost and great fanfare and because there was not enough buy-in, what we were left with was simply a payroll system.”
# “We can’t afford a repeat of that.”
# Mr Wilson said the next few months will be intense as staff learn the system before it is launched early next year.
# He said salary reassessments and pension payments are among the government services requiring too much manual work.
# “All these things take time, and to compensate for time, we hire a lot of people,” he said. “We have large accounts departments, and even with extra manpower, we’re still short-staffed because even with extra manpower, we need trained officers.”

He said some employees received a salary for decades even though the government could not account for them or their work. It is the kind of irregularity he hopes to solve with a new digital system.

The Ministry of Finance hosted a training workshop at the National Training Agency yesterday to introduce finance officers to the Oracle ERP Fusion system.

“Our payroll accounts for 60 per cent of the government’s budget,” Mr Wilson told reporters after the event’s opening ceremony. “And if we have an error rate of 10 per cent, that’s roughly $120m. Those small errors, overpayments or underpayments and so forth, if you minimise those errors, you can have tremendous savings from the government.”

Mr Wilson said all employees would be captured in the new system, preventing cases of people getting a salary under dubious circumstances.

“Everyone knows of the employees who get lost in the system,” he said. “In the Family Islands, they work for local government, they work for the school board, but they are hired irregularly, i.e., they’re not in the pay sheet, they’re paid by some other mechanism or some other means.

“Every employee is going to be captured in this system. That is for us critical cuz we assume, sometimes wrongly, that we know of every employee, that we know the details of every employee. But every year, we find instances where we do not know an employee existed or was being paid or has been paid by the government or the ministry.

“I know from my own experience in the Ministry of Finance we had employees in Andros who we paid for 40 years, every month, employees of the Ministry of Finance. We don’t know what he did, never did an ACR of those employees, but they were paid every month, and they retired.

“And what they did when they retired? They took a flight and come up to the Ministry of Finance and said I retired, where is my gratuity? And we had no answer. We checked their records and, yes, surely enough we paid them from 1974 up until 2014, every month, but we had no record.

“And we have too much instances like that and persons go undetected and then we have to go through this long, arduous process of trying to regularise them.”

Mr Wilson said the last time the ministry tried to modernise the accounting and financial management system, success was limited because of insufficient support from workers. 

“We cannot succeed unless there is buy-in from finance and accounts officers,” he said. “We’ve done this before, with JD Edwards, which we purchased at great cost and great fanfare and because there was not enough buy-in, what we were left with was simply a payroll system.”

“We can’t afford a repeat of that.”

Mr Wilson said the next few months will be intense as staff learn the system before it is launched early next year.

He said salary reassessments and pension payments are among the government services requiring too much manual work.

“All these things take time, and to compensate for time, we hire a lot of people,” he said. “We have large accounts departments, and even with extra manpower, we’re still short-staffed because even with extra manpower, we need trained officers.”

 

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