New Zealand faces important Novopay test

The New Zealand government is urging schools to get in early on their start of year admin, in an effort to avoid another round mispayments from the national teacher payroll system, Novopay.

The Novopay failure - New Zealand’s answer to the Queensland Health payroll disaster - has been causing trouble for schools since the system first hit the rocks in September 2012.

A June 2013 review into the implementation pointed to governance issues and ‘optimism bias’ as key defects in the rollout, which has an estimated final price tag of NZ$56.8 million (A$54 million).

The beginning of the 2015 school year marks the peak administrative period for schools as they update the books with new and returning staff - a load which pushed the troubled solution over the edge this time last year. Novopay manages pay for around 90,000 of the country's school staff.

The rate of activity at the start of last year pushed the Novopay error rate past the government’s 0.5 percent ‘acceptable’ threshold after a clean run of nearly 12 months. The February 5 pay run had an error rate of nearly 0.7 percent - equivalent to 516 teachers overpaid, underpaid or not paid at all, out of more than 74,000.

This year’s peak cycles will be the first pushed through since NZ and its Australian Novopay systems integrator, Talent2, parted ways, and the government took over full responsibility for stabilising and maintaining the system.

It has since established a dedicated state-owned company, Schools and Education Payroll Limited, to undertake the work.

NZ’s minister responsible for Novopay, Steven Joyce, today insisted that “the hard work that has gone into reducing the number of payroll issues and errors is reaping rewards”.

“The figures show significant improvement compared to this time last year, which was in turn a big improvement on the year before,” he said, pointing to an error rate of just 0.2 percent through December.

But he also conceded that the January and February months would be the real test of his government’s progress as the new sole custodian of Novopay.

“This is, traditionally, a more challenging time than the end-of-year period.  Last year’s start-of-year period was the only time in the last 21 months where there has been significant issues with delivery of the payroll," he said.

“The ministry and the new payroll company have put extra resources in to ensure it runs as smoothly as possible this year."