Parliament drives payroll reform
The transfer of the public service payroll system from the Department of Finance to the Department of Personnel Management [DPM] has been described as a major reform driven by parliamentary oversight following years of delays and serious weaknesses identified in an independent review.
Chairman of the Parliamentary Committee on Public Sector Reform, Gary Juffa, said the launch shows that parliamentary committees can do more than simply table reports in Parliament.
"Today is testament to a Parliamentary Committee pushing its limits to drive accountability of public administration," Mr Juffa said.
"Public sector reform in this country must not merely be announced, but delivered. Not merely funded, but implemented. And not merely celebrated, but measured."
Mr Juffa acknowledged the Marape-Rosso Government for supporting parliamentary committees with the resources needed to carry out oversight work, even when those committees have been critical of the government.
He also reminded those attending that concerns over the public service payroll were first identified more than a decade ago.
Mr Juffa said the decision to conduct a payroll audit was originally made by the O'Neill Government in 2014, but it was not implemented until the Marape-Rosso Government took office in 2019 and ensured the review was carried out.
The independent Deloitte Payroll Diagnostic Review, completed in April 2023, uncovered 53 findings across the public service payroll system, with 27 classified as high-impact and high-priority, along with 135 recommendations for reform.
Among the major issues identified were deceased and terminated employees who remained on the payroll and continued receiving salaries, while some individual payments exceeding K100,000 in a single fortnight were processed without proper review.
Mr Juffa said Deloitte also identified a serious conflict of interest because the Department of Finance was responsible for using, administering and paying through the payroll system.
"The Department of Finance was, at one and the same time, a user of the payroll system, the administrator of the payroll system, and the payer of every public servant in this nation."
He said Deloitte concluded that the concentration of those responsibilities meant existing controls over the payroll process had "little or no effect at all."
The report recommended that payroll administration be returned to the Department of Personnel Management under the Public Service Management Act, with the establishment of a dedicated public service payroll office.
Mr Juffa noted that while the recommendation has now been implemented, it took three years and three months after Deloitte submitted its report.
"Reform delayed is money lost and it is trust lost."
He cautioned that simply transferring payroll responsibilities would not solve the problem unless strong internal controls, regular audits and proper segregation of duties are maintained within DPM.
"Moving the keys does not remove the risk, it moves it."
Mr Juffa said Parliament will continue monitoring the reform and expects DPM to report back within six months on progress made in removing ghost employees, cleaning payroll records, reviewing user access and upgrading the ALESCO payroll system.