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Govt reactivates pre-Novopay pay provider as problems persist

31 Jan 13

The government is reactivating its relationship with Datacom, the New Zealand firm that managed teacher payrolls before they were switched to the glitch-plagued Novopay system last year.

The senior Minister made responsible for handling the Novopay debacle, Steven Joyce, announced a series of steps today, including "investigating a revised contingency plan led by the acting Secretary of Education, who has commenced dialogue with previous supplier, Datacom."

Datacom, a quiet giant of the New Zealand information technology sector, handled the education pay system from 1996 until August last year, when Australian firm Talent2 implemented Novopay as a replacement, after a process that took the best part of a decade from the time of initial reviews in 2002.

Joyce also announced terms of reference for a Ministerial inquiry, with the intention that the results of a technical review be "fed into the inquiry, and for the inquiry to cover all aspects of the teacher payroll system from outset to present day."

The review will inevitably cover six years in which the payroll system changeover was under the control of the previous Labour-led government.

Meanwhile, Joyce warned there would be ongoing problems with Novopay in next week's teacher pay round, the first since schools have returned this year. It was especially likely to have trouble dealing with the details of new collective agreement for secondary school teachers.

"I have made it clear to all parties that the on-going issues with Novopay are unacceptable and new measures are being put in place to provide timely solutions," said Joyce.

"Novopay is one of the largest payroll systems in Australasia covering approximately 110,000 people and 15 separate collective agreements.

After meeting with the key parties involved over the past week, it is clear the issues it has are complex, that there is no quick fix, and problems will continue for some time," he said.

Joyce announced a technical audit of the Novopay system's stability would be undertaken, and that a senior accountant, Murray Jack of Deloitte, will lead a technical review to include results of an audit currently being carried out by another accounting firm, Ernst & Young, along with an accelerated audit of a sample of schools.

A new Novopay Remediation Plan will also be implemented, led by the Novopay Management Board, and the government will provide additional resources "on a contingency basis while reserving its contractual position with Talent2."

By Pattrick Smellie - BusinessDesk

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