More than half a billion dollars in overpayments to federal employees due to previous errors in Ottawa’s Phoenix Pay System are yet to be recovered, according to recently released federal records.
“Since the launch of Phoenix approximately 389,500 employees have been identified as having received either an administrative overpayment or true overpayment totaling $3.08 billion as of April 24,” Cabinet wrote in the Inquiry tabled on June 9, as first reported by Blacklock’s Reporter.
However, it added that $553 million in overpayments are yet to be recovered.
“True overpayments usually occur when certain pay transactions are not submitted or processed promptly,” wrote Public Services and Procurement Canada (PSPC) in the Inquiry.
“Some situations are related to unforeseen work-life events,” it added. “Flexible repayment measures are in place to avoid, where possible, adverse impacts on employees with a true overpayment.”
PSPC also said that it had not written off any of the $553 million in overpayments because federal employees who have received them are meant “to acknowledge their debt or enter into a repayment agreement in order to have access to flexible repayment options.”
Debt Written Off
However, the Department of Industry wrote that it had written off one overpayment totalling over $45,480 that was “related to a deceased employee.”“Every effort is made to collect funds prior to considering writing off an amount owed to the Crown,” the department stated in the Inquiry.
The department added that it attempted to recover the overpayment from the deceased person’s estate, but “received confirmation that the estate was insolvent; meaning no funds were available to repay the debt.”
“Given that all collection efforts had been exhausted, we were required to seek Treasury Board approval to write off this debt,” it wrote.