Today, the Auditor General of Canada released her report on the performance audit of Modernizing the Pay System, examining whether Public Services and Procurement Canada (PSPC) and the Treasury Board of Canada Secretariat (TBS) are effectively managing the Human Resources and Pay Transformation Project.
I welcome the Auditor General's findings and thank her for this important work. Her report comes at a critical time for the project and provides useful direction as we move forward. It confirms that real progress has been made, while also making clear that sustained focus and discipline will be required to deliver results.
The Auditor General concluded that PSPC and TBS are managing the HR-to-Pay Transformation in a way that positions the future system to deliver accurate and timely pay, and to demonstrate value for money. This is an important finding. At the same time, the report identifies areas where further work is needed, and we agree with all of the recommendations.
Over the past several years, PSPC and TBS have taken concrete steps to stabilize pay operations and address the root causes of past issues. This includes simplifying pay rules, reducing manual processing, improving data quality, and standardizing HR processes across government. These are necessary changes to ensure the system works reliably over the long term.
These efforts are producing results. The number of pay transactions older than one year has been reduced by more than 50 percent over the last two years, a decrease of over 106,000 cases from the peak. The backlog now stands at approximately 98,000 cases and continues to decline. At the same time, close to 200 critical HR processes that directly impact pay accuracy have been standardized in preparation for the new system.
The transition to Dayforce is being approached carefully. Lessons from past challenges are being applied. Governance has been strengthened through independent oversight and a more rigorous internal challenge function. Transparency has also been increased to ensure decisions and progress are clearly communicated. Engagement is also central to this work. Public servants and bargaining agents are being involved early and throughout the process to validate requirements, support testing, and ensure the system reflects operational realities.
We are also taking action in response to the Auditor General's recommendations. This includes strengthening our approach to reducing the remaining backlog, improving cost transparency related to the transition, and demonstrating value for money by tracking whether processing costs decrease under the new system.
Modernizing pay is a complex but essential responsibility. The progress made is real, but the focus remains on delivering a system that pays public servants accurately and on time, every time.
