Buried in the Budget: $82.3M to fix government payroll mess

Some agencies are still struggling to achieve Holidays Act compliance

Holidays Act compliance failures are driving government agencies to spend large on new systems, technology and remediation.

Holidays Act compliance failures are driving government agencies to spend large on new systems, technology and remediation.

The "Wellbeing Budget" released yesterday includes millions of dollars to fix flawed departmental payroll systems.

The biggest number was $63.5 million in operating funding to ensure current and former school staff receive holiday pay corrective payments where they have not been calculated in compliance with the Holidays Act 2003.

A further $2.6 million in operating funding was voted to ensure that the schools payroll service was compliant with legislation, employment agreements, wider education policy and assurance requirements.

The Ministry of Business, Innovation, and Employment was voted $12.9 million in operating and $2.7 million capital funding to replace its 20 year old payroll system with a modern, cloud-based payroll system.

That would allow the Ministry to comply with its legislative requirements under the Holidays Act and to operate more economically, the Budget document said.

As reported by Reseller News in February, MBIE selected SAP to deliver the cloud system at a cost then estimated at between $15 million and $18.5 million. 

Parliamentary Service will receive $1.2 million in operating funding to remove the operational and business risks associated with a payroll solution that will become unsupported from the end of 2019.

The service provides a range of shared services to other agencies such as Ministerial Services and the Office of the Clerk on the parliamentary precinct, including finance, ICT, payroll and information and research services. 

Over the top of all that, $2 million of operating funding will go to the government chief digital officer to reduce the risks and costs of change to payroll systems across government and to ensure payroll systems are future-proofed.

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"This will be done by providing funding for the government chief digital officer to lead a program of work across government to engage with suppliers and provide investment advice to government agencies," the Budget said.

A spokesperson told Reseller News the funding was for DIA to lead a proposed program of work to improve payroll practices within government, provide oversight of government’s investment in payroll projects, and to coordinate government’s procurement of payroll systems and services.

"Cabinet will consider a detailed proposal from officials on this program of work," the spokesperson said.

"It is anticipated that this program will deliver on-going cost savings by removing the need for each agency to design bespoke payroll processes, manage costly and lengthy procurement processes, and invest in complex configurations of payroll systems."

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