Payroll errors costing taxpayers near $120m

By FAY SIMMONS Tribune Business Writer jsimmons@tribunemedia.net

SALARY and payroll errors are costing Bahamian taxpayers around $120m per year, the Government’s top finance official disclosed yesterday, as he blamed the wastage on too many systems that are not linked to each other.

Simon Wilson, the financial secretary, speaking to government employees at the Oracle ERP (enterprise resource planning) system training and professional development workshop, said the public sector payroll is estimated to have a 10 percent error rate. With public service pay and benefits accounting for about 60 percent of the Government’s budget, he added this translated into a near-$120m annual loss.

“Well, our payroll accounts for 60 percent of the Government’s Budget. And if we have an error rate of 10 percent, that’s roughly $120m. That’s why it’s important. Those small errors…overpayments or underpayments and so forth. If you minimise those errors, you can have tremendous savings,” Mr Wilson said. Further errors occurred when persons who have died, or have left the public service, continue to receive a salary from the taxpayers.

Mr Wilson explained that the problems stem from having separate systems for payroll, general ledger, budget and final accounts, thus making it difficult and time consuming to move information across platforms.

“There is no one central application, so moving information between the various applications is time consuming, increases the workload of the officers within those applications themselves,” he added. “Basic functions are very manual and not properly understood.

“So, for example, we do salary reassessments, back pay. As is, it’s very, very manual. Repairing for pension payments, that is very, very manual. We can’t flip the switch and say: ‘This is what is owed’... There’s no tie-in to our revenue systems. So you still have posted manually revenue receipts. All these things take time, and

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