I recently wrote to Treasury Board President Scott Brison to express my frustration at being informed that the government is very likely not going to be able to process overpayment claims reported by the January 19, 2018 deadline. I called on the Minister to immediately take every measure necessary to ensure that no public service employee should have to pay more than they received in overpayment, and pointed to the need for a new pay system to be built by our members.
The Honourable Scott Brison
President of the Treasury Board
90 Elgin Street, 8th Floor
Ottawa ON K1A0R5
By email: President@tbs-sct.gc.ca
January 30, 2018
I am writing today as a follow-up to our earlier request to ensure our members are not unfairly penalized due to an overpayment caused by the Phoenix pay system. When faced with the reality that many employees had received overpayments, we had originally asked for a tax exemption so that no employee would have to pay back more than they received in overpayment. The government’s response was to set up a deadline for reporting overpayments, to the effect that employees who met the deadline would be issued a corrected T4 and would need only to repay the net of their overpayment (the amount they actually received). Indeed, we even helped communicate this deadline to our members through our own channels.
We have now been informed that the government is very likely not going to be able to process overpayment claims reported by the January 19, 2018 deadline. Not surprisingly, the volume of these claims was high given that Phoenix has caused so many problems for federal employees. There are still some 16,000 claims left to process, which means that potentially thousands of our members – despite having submitted their claims well within the specified timeframe - will not receive corrected T4s for the 2017 tax year and will therefore be forced to pay back the gross amount overpaid by Phoenix (more than they received). We find this unacceptable, as this will certainly wreak havoc on their personal finances and tax planning for the year.
I can’t emphasize enough how disappointed, if not angry, I am with the situation. While I appreciate that your government has taken a number of steps to address the seemingly innumerable problems caused by Phoenix, the reality is that we are no closer to solving the systems’ problems than we were a year ago – and public servants are literally paying the price of its failures.
I am therefore calling upon you to immediately take every measure necessary to clear this backlog and to ensure that no public service employee should have to pay more than they received in overpayment. As I have said before, the amount of problems with the system clearly point to the need for a new pay system built by the very people it will pay. Public servants understand the workings of government and should be tasked with building a new pay system that works.
I look forward to your response about how the government will tackle this latest failure of the Phoenix pay system.
The Professional Institute of the Public Service of Canada