In 2010-2011, Public Works and Government Services Canada (PWGSC) Compensation continued its effective management of payroll, insurance and pension processes and systems by providing services to 112 departments, agencies and other organizations representing approximately 342,400 employees and 349,700 pensioners. Nearly 14.2 million payments were made to employees and pensioners during the year.
Continued progress was made towards modernizing both federal pay administration and pension administration and despite our aging technology and its inherent limitations, PWGSC was able to maintain support and services to client departments and agencies.
A skilled and knowledgeable workforce in PWGSC Compensation was made possible through multiple initiatives, including the ongoing staff development programs and the implementation of comprehensive Human Resources planning, well integrated with operational business plans.
This document outlines our progress on commitments, and provides a status report on all major activities and accomplishments for the fiscal year 2010-2011.
If you have any comments about this report or would like further information, please contact:
Branch Planning Directorate
Public Works and Government Services Canada
Gatineau QC K1A 0S5
As you may be aware, PWGSC is the largest payroll and pension administrator in Canada. Through the Transformation of Pay and Pension Administration initiatives, our department is bringing its compensation systems and business practices into the 21st century by introducing modern software (commercial-off-the shelf products referred to as COTS) and industry standard business processes that will allow PWGSC to better meet changing, and more demanding client service requirements and sustain its current mandate.
From a service delivery perspective, the modernization initiatives include the Consolidation of Pension Services Delivery Project and the Consolidation of Pay Services Project. These projects are transferring the delivery of services from departments to two PWGSC's centres of expertise. Eleven of the twelve pension services have already been centralized to the Pension Centre in Shediac, NB. As well, the centralization of pay and benefits services will begin in 2012 and pay administration activities will be gradually transferred to a new Centre of Expertise in Miramichi, NB. By centralizing pay services, PWGSC will save the Government resources, and enable departments to focus on their core mandate.
Despite the many challenges of transformation, PWGSC Compensation continues to maintain its operations and remains committed to meeting our clients' requirements. As in the past, our legacy systems were maintained and subjected to numerous changes during the year, in order to implement the legislative changes and new operational requirements. In addition, the new pension administration system, Penfax, became operational in April 2011 at the Public Service Pension Centre.
We remain committed to optimizing the use of available resources to ensure seamless service delivery to our clients, until our new systems are fully in place. This past year, our periodic National Compensation Services Client Feedback Survey revealed a satisfactory rating of 87% for the pay services. We will certainly do our best to continue to maintain and strengthen all of our services as we proceed with our major transformation.
Assistant Deputy Minister
Accounting, Banking and Compensation Branch
Public Works and Government Services Canada
We provide payroll, insurance and most pension plan administrative functions for the Government of Canada.
The Compensation Sector, the Public Service Pension Centre and the Transformation Projects are all part of PWGSC Accounting, Banking and Compensation Branch.
PWGSC Compensation is responsible for the government-wide pension administration and the central pay administration. The function is delivered by the Compensation Sector and the Public Service Pension Centre of the Accounting, Banking and Compensation Branch and six regional payroll offices under the responsibility of the Regional Directors General.
As part of its responsibilities, PWGSC Compensation develops and maintains computer systems and ensures an overall business administration infrastructure is in place for the delivery of pay and pension administration, including training and advisory services provided to more than 2,200 compensation staff across the government. This allows departments to administer pay and benefits in accordance with collective agreements and compensation policies established by the Treasury Board Secretariat of Canada (TBS) or certain separate employers; and ensures the administration of the pension plan for federal public service employees, as required by the Public Service Superannuation Act (PSSA) legislation 1. PWGSC Compensation also provides specialized services for the administration of superannuation plans to the Department of National Defence, Members of Parliament (MPs), diplomatic services, lieutenant governors and judges. Lastly, administrative support is provided for insurance plans, including the Public Service Health Care Plan, the Disability Insurance Plan, the Public Service Management Insurance Plan – Life Insurance and Long-term Disability, the Public Service Dental Care Plan, and the Pensioners' Dental Services Plan.
PWGSC Compensation could not accomplish its work without our primary partner, the Information Technology Services Branch, who ensures Compensation systems are maintained and updated to meet our ever changing needs. As functional authority, the Compensation Sector ensures oversight. The Sector provides support to the Pension Centre and regional offices, and is responsible for the overall business infrastructure and system development and maintenance. The Sector also assumes the responsibility of regional office for the National Capital Region (NCR) by providing training and advisory services, and processes pay transactions for client departments of the NCR. This same role is played by each regional office.
1 An Act that provides pension benefits to eligible federal public servants and their dependants. The public service pension plan provides benefits for public service employees, payable on retirement, termination of service or disability and for their survivors after death under the provisions of the Public Service Superannuation Act.
Six regional pay offices support client departments to ensure employees receive timely and accurate remuneration. A main responsibility of the regional pay office is to analyze and correct rejected transactions due to the pay system's inability to process them. Regional pay office staff also ensures that there is an adequate segregation of duties for pay transactions so that fraud is prevented. The six regional pay offices service over 319,000 employee accounts.
|Regional Office||Pay Accounts||National Percentage|
The Pension Centre in Shediac, NB, is responsible for the delivery of pension services, as provided under the PSSA. As of March 31, 2011, the total number of annuitants paid by the Pension Centre was 236,785. The Compensation Sector administers 112,979 accounts for Canadian Forces and other superannuation plans, bringing the total number of annuitants' accounts to 349,764. Payments for public servants contributors were processed for 339,371 accounts this year.
PWGSC Compensation administers more than two million accounts in order to deliver pay, pension and insurance services.
|MPs and Judges||1,378||1,389|
|Health Care Plan||548,834||564,003|
|Public Service Dental Care Plans||445,689||427,781|
|Public Service Management Insurance Plans
|Public Service Management Insurance Plans
|Annual Number of Payments in million $||2009-2010||2010-2011|
|Annual Number of Payments in million $||2009-2010||2010-2011|
|MPs and Judges||.02||.02|
We have four major commitments to our clients, each of which were addressed over the year through specific compensation activities, as described below.
To meet our stewardship obligation and ensure the integrity and sustainability of the pay and pension operations on behalf of the Government of Canada.
The following chart depicts the historical trend of pay accounts administered under the Regional Pay System since 2001-2002. It does not include RCMP pay system accounts:
|Fiscal Year||Pay Accounts Trends as of March 2011 (in thousands)|
Pension payments were processed for a total of 349,764 client accounts which include 236,785 public servants, 111,590 members of Canadian Forces and 1,389 Members of Parliament and Judges, or their respective survivors.
|Fiscal Year||Pension Accounts Trends as of March 2011 (in thousands)|
The combination of above actions enabled the Pension Centre to maintain levels of service standards despite transformation of systems and processes changes.
Pension Expert at the Public Service Pension Centre in Shediac, NB
In conducting our operations, we want to be able to compare our costs and results with similar organizations. Accordingly, comparative assessments of business processes, human resources and technology used in the administration of pay, benefits and pension are useful to our operations. Such analyses are based on quantitative and qualitative elements such as cost, risk and complexity. They permit us to assess our performance and practices against other public and private organizations.
In 2010-2011, work was initiated to conduct a pay benchmarking survey based on 2009-2010 pay data. Information was gathered from stakeholders, and the assessment was conducted with an independent firm specializing in pay benchmarking. Approximately 50% of the PWGSC survey information was completed, and work is underway to ensure that the pay benchmarking study is completed in the winter of 2011-2012.
Pension administration measures its performance through membership in two benchmarking organizations:
Comparative 2010-2011 data from both benchmarking organizations is being used to initiate discussions with other Canadian and international pension plan administrators in regards to ideas for reducing costs and improving services. Specific discussions are under way with Canadian plan administrators on how to expand the availability of electronic documents which are increasingly being requested by our client population.
PWGSC Compensation continued to provide expertise and training in pay, statutory deductions and insurance to its own staff and to departments. In addition to courses, we responded to about 42,700 requests for pay, insurance and pension-related information and guidance from clients during the year.
PWGSC Compensation also continued restructuring and redesigning paper-based self-instruction and classroom courses to capitalize on the potential of technology to empower learners with self-directed learning. Instructions for the On-line Departmental Security Application form were improved and converted to an online training module.
Updates to the Advanced Pay Course were initiated to reflect the new Policy on Terms and Conditions of Employment. Also, as a result of changes to severance pay entitlements in recently-signed collective agreements, additional updates are now required and will be completed in 2011-2012.
|Region||Pay||Insurance||Pension||Total Sessions Delivered||Participants|
|National Capital Region||67||40||18||125||866|
A PSHCP Web-service application was recently launched to enable employees to directly modify their health care coverage. As a result of this new Web-service and the associated business process changes, three courses were redesigned and given a modern look. The Disability Insurance and Public Service Management Insurance courses were also updated.
In addition to classroom classes, a total of 19,166 public service employees attended 601 'Retirement Planning' information sessions during the year. While the Pension Centre assumes responsibility for the pension training, the sessions are often given by the Compensation Sector or regional pay offices.
Compensation Advisors in Training
Marketing of the Compensation Sector pension and benefits portal and compensation self-service tools was also conducted through exhibits held at public events that occurred in Ottawa and Halifax.
Internal controls are an important aspect of both compensation and government oversight with the reality of accountability that has increased in the last 7 years. Effective controls are essential for deputy ministers to assume their Accounting Officer's responsibility. As such, internal controls not only need to be in place to ensure the accuracy and integrity of our systems and processes, but must be tested on an ongoing basis to make sure they remain effective at preventing or reducing errors, fraud or misappropriation of funds.
The Compensation Sector had previously undertaken to document and assess all internal controls of the pay system, and an initial assessment of key controls was completed. In 2010-2011, we completed the review and testing of all automated controls within the pay system to ensure that they were working effectively. An action plan was developed and implemented to address identified gaps. Work is now proceeding on the identification and testing of manual controls in the pay system using the same control objectives that were established for the automated controls.
PWGSC Compensation continued testing pension key controls and reviewed additional processes to ensure that internal controls were in place and working effectively. Throughout the design process of the new pension solution, work sessions were held to ensure that key controls were established in the pension system, Penfax. An assessment review was conducted in the spring 2011, and further assessment will continue until we reach the end state of implementation.
The Payment Integrity Testing program was also enhanced by establishing a process through which the listing of un-cashed cheques received from the Receiver General is obtained for review. This is serving as an excellent source of data to detect potential fraud, and has a positive impact on the results of our debt recovery initiative.
To deliver quality services that meet the needs of our clientele: departments and agencies, public servants and pensioners.
The Compensation Sector Web site provides information on pay, pension and insurance services. It also contains information on compensation products including: publications, directives, bulletins and communiqués. This fiscal year, nine new directives were posted on this Web site, as well as 248 updates to the manuals.
The popularity and success of the Compensation Sector Web site is demonstrated by the average number of visits which hits 2.7 million per month in 2010-2011.
Your Public Service Pension and Benefits Web portal is managed in partnership with TBS. This Web portal provides rapid access to information for active and retired plan members, as well as their dependants and/or survivors, while allowing compensation specialists to reduce the time spent on pension/benefit queries. This year, this Web site was improved by adding new life events features for active and retired members such as 'travelling outside of Canada' and 'working outside Canada'; and other life events for survivors/dependants such as 'death of a survivor' and 'living or moving outside of Canada'.
Among the many life events already available on Your Public Service Pension and Benefits Web portal, the most visited life events during 2010-2011 were:
The public service pension plan repository Web site contains all communications directed to pension plan members. This common repository stores all PWGSC compensation-authored plan member communication products, ensuring that pension members have easier access to the information they require.
PWGSC Compensation has undertaken a major overhaul of its Web sites to ensure they are fully compliant to the Common Look and Feel (CLF) 2.0 and the Web Content Accessibility Guidelines (WCAG) 2.0 and standards. The standards ensure Web content is accessible, primarily for disabled users. This specialized work is still underway and will require review and updating of more than 6,000 pages. The work to convert all compensation Web sites is expected to be completed by December 31, 2011.
Referred to as CWA, these applications are a suite of self-service pay and pension tools that enable employees to monitor and manage their personal compensation information, as well as calculate pay, insurance and pension 'what if' scenarios to assist with financial planning in addition to providing a key and cutting-edge service to public servants. The CWA services, which include pay and pension calculators, reduce the number of requests for estimates to compensation advisors, allowing them to concentrate on other value-added activities.
The self-service tools allow employees to:
CWA offers a paperless feature that significantly reduces costs associated with printing and distributing hard copy reports and pay stubs to all departments across Canada. Savings are also realized as a result of the automated record of employment, which is filed electronically with Human Resources and Skills Development Canada (HRSDC).
As of March 31, 2011, CWA had deployed to 102 departments, agencies and Crown corporations that receive pay and/or pension services, making the service available to approximately 320,000 employees. Once deployed in a department, efforts are made to increase awareness and use (i.e. take-up rate) amongst employees in that department.
A number of departments have stopped printing pay stubs, as a means to reduce costs and encourage use of CWA.
|Indian and Northern Affairs Canada||78%|
|Canada Revenue Agency||80%|
|Public Works and Government Services Canada||97%|
Each month during 2010-2011, an average of:
Saving paper through CWA
Overall, the use of Web applications and electronic formats has saved the Government of Canada a total of 155.92 metric tonnes of paper to date. As well, this contributes to the government's efforts to reduce overall carbon emissions, as paper no longer needs to be produced, printed, or physically transported to data centres.
PWGSC Compensation is fully committed to PWGSC's Client Service Strategy, an initiative to enhance PWGSC's relationships with client departments by delivering high-quality services that meet clients' needs.
In 2010-2011, the Compensation Sector reported on the previous year's client feedback survey regarding compensation services provided by the six regional pay offices, including headquarters. The target audience for the survey was compensation directors, managers and advisors in all departments, agencies and Crown corporations who receive PWGSC's services. The results show an overall national client satisfaction rate of 87%, exceeding our target of 85%. Corrective actions for any areas falling below the target, as well as best practices for any areas exceeding the target, are being gathered to help us gain insight in improving our national client service strategy.
|Pay and Pension Services||89%||86%|
The 2009-2010 Compensation Client Feedback Survey results are now being used by each regional pay office to improve services. It is PWGSC's objective that all clients receiving our pay services and for which we are processing pay transactions related to pension are satisfied with those services at all times. Preparations for the next survey scheduled for 2011-2012 are underway.
To support the government's commitment to modernize management practices ensuring sound management, delivering services smarter, faster and at a reduced cost with improved accountability and increased transparency, supported by adequate risk management.
The compensation transformation initiatives are Government of Canada's Compensation renewal of its pay and pension business processes and systems, including the consolidation of government compensation services from departments to PWGSC Centres of Expertise. The aim is to ensure the ongoing capability to provide compensation functions for federal public servants, pensioners, dependants and/or survivors, as well as to provide greater flexibility and functionality, and improved overall Government of Canada efficiency in service delivery.
Prior to the Transformation of Pension Administration Initiatives, pension services were provided through a decentralized delivery model that relied heavily on the knowledge and experience of compensation advisors across 112 client departments, separate employers, agencies and Crown corporations.
Together, the Pension Modernization and Centralization of Pension Services Delivery Projects are changing the way pension services are provided across the public service. Pension Modernization is ~70% completed and is approaching a major milestone in 2011-2012 when it will implement major components of the new core pension system. Centralization is ~90% completed and will leverage the new system's capabilities to centralize two high volume services related to pension entitlements, as well as the new Employer Support Services.
This fragmented and dispersed delivery model, combined with the outdated 40-year-old technology of the current pension systems, severely impacts PWGSC's ability to sustain the pension administration function; significantly restricts PWGSC's ability to maintain current service levels and meet client demands for improved services; and prevents the adoption of modern, cost-effective service delivery processes that are consistent with industry standard practices. In addition, the pressures will escalate in the coming years as the number of retiring public servants increases.
PWGSC has undertaken several initiatives aimed at ensuring the sustainability of the public service pension administration. These initiatives, collectively referred to as the Transformation of Pension Administration Initiatives, are designed to improve service quality and efficiency, strengthen accountability and increase the capacity of the pension administration systems. The initiatives include:
Although these are separate and distinct initiatives, they are being developed and implemented concurrently and share the same objective of implementing renewed services, processes and systems to enable a modern pension administration model. As well, data integrity is being improved through specific data correction and auditing efforts.
The existing federal payroll service delivery model relies on an antiquated legacy system and is decentralized. Part of the payroll administration process is conducted across government departments by compensation advisors. This delivery model makes the Government of Canada payroll administration among the least efficient when compared to the industry average.
The establishment of the pay Centre of Expertise will lead to the creation of 550 public sector pay jobs in Miramichi, NB, starting in 2011-2012 and reaching a full staff complement by 2015-2016.
To sustain the Government of Canada's long-term requirements for pay administration, the Transformation of Pay Administration Initiative was launched in October 2009. The goal is to transform the government's pay administration by streamlining processes, introducing increased self-service capabilities, and consolidated pay services for departments and agencies that are currently using PeopleSoft 2. On August 19, 2010, the Prime Minister announced that the Government of Canada is transforming pay administration by replacing its more than 40-year old pay system and gradually consolidating its pay services from departments to PWGSC's new pay Centre of Expertise in Miramichi, NB.
The Transformation of Pay Administration Initiative is comprised of two projects, scheduled to be completed by 2015-2016:
The transformation of pay administration will ensure the long-term sustainability of the Government of Canada pay administration system and services, and contribute to a more effective and efficient public service, offering better value to Canadians.
2 The Government of Canada Human Resources Management System version of PeopleSoft
PWGSC Compensation, in collaboration with the TBS, continues to advance the new health care Web service tools, integrated data files and insurance data exchanges. In 2010-2011, we completed the following activities:
Additional interfaces between the Regional Pay System and the new pension solution were implemented in 2010-2011, allowing required data to be extracted and transferred to Penfax.
Electronic Systems Network Architecture Printing, or e-SNAP, is an internal tool that provides an easily viewed electronic version of systems reports and offers a workflow management process for certain reports. In 2010-2011, improvements were made to existing reports and a significant investment was made in improving the infrastructure to ensure that the e-SNAP solution is scalable and robust enough to meet future demands.
In conjunction with the Canada Revenue Agency, significant changes were also made to the design of the T4A tax slip. As well, modifications were made to the Regional Pay System programs that calculate income tax being taken at source for the T4A-RCA (retirement compensation arrangement) purposes.
In 2010, the Government of Canada and PWGSC announced market rates for government-owned parking. As a result, there was a requirement to report the taxable parking benefits on employees' tax slips for 2010. New reference codes were created in the pay system to report and identify the parking taxable benefits. The regional pay offices also manually entered parking taxable benefits for 11,079 employees to ensure that this information was included in the 2010 tax slips.
To promote a work environment through an expert, diverse and motivated workforce which supports, understands and practices the concepts of integrity, values and ethics.
PWGSC Compensation continued to address the ongoing issue of attrition resulting from upcoming retirements and loss of valued expertise. In order to maintain a staff of competent experts in compensation, the Accounting, Banking and Compensation Branch continued to recruit through the Compensation Analyst Development Program (CADP); in addition to a continued administration of two apprenticeship programs through The Pension Centre.
Apprenticeship Recuits 2010-2011
The Public Service Pension Centre has established a partnership with the Canada School of Public Service since 2009-2010 to organize a 'client service excellence' program for our Pension Experts. The program is offered through three courses and is delivered in one-day session each. To date, a cumulative total of 380 Pension Centre employees have attended only the first course; of those, 306 have attended the second and 198 have completed all three.
The course will also be offered to all Regional Pay Office staff that deal with departments and agencies in the delivery of pay office services.
PWGSC Compensation remains excited about what's ahead for our team. While not an exhaustive list, here are some of the key activities we will be pursuing in the 2011-2012 fiscal year: