Joyce sends mixed signals on Novopay

Formal contract breach notices approved. But government also allocates $5 million for Novopay bug fixes and extra staff; emphasises difficulties involved in reverting to previous payroll provider Datacom.  UPDATED

Steven Joyce sent mixed signals on Novopay today.

On the one hand, the cabinet trouble-shooter said he has authorised the Ministry of Education to send formal breach of contract notices to Talent2, the Australian company that created and runs the troubled payroll system.

On the other, Mr Joyce revealed his government has set aside $5 million to patch up Novopay - indicating there are no immediate plans to break with Talent2.

The $5 million will fund bug fixes, and Talent2 hiring 30 to 40 call centre and payroll processing staff to the 130 already allocated to the project.

Mr Joyce earlier said the government has opened talks with Datacom, which provided the previous teacher payroll system.

But in allocating extra funding to Talent2 today, Mr Joyce seems to be indicating the government will stick with Novopay, at least in the medium term.

Mr Joyce said he met with Datacom last night, with regards to a contingency plan and came away with the impression "It is clear that any alternative to Novopay would be challenging to roll out and could take anywhere between three to 12 months to be fully implemented.

Mr Joyce also released the terms of reference for a technical inquiry into Novopay.

Although the government putting another $5 million on the table, Mr Joyce said it was an open question who ultimately picked up the tab for Novopay fixes: Talent2, the Ministry of Education or the Crown.

Labour's Chris Hipkens said the government was throwing good money after bad. So far, around $30 million has been spent on Novopay.

Mr Joyce said although extra cash has been allocated for bug fixes and extra staff, glitches will not be fixed in time for the next pay period. 


"On the face of it the  terms of reference appear thorough and the scope appropriate to achieve a good picture of whether Novopay is technically capable and suitable to deliver stable and accurate payroll in schools for the next decade," Institute of IT Professionals NZ CEO Paul Matthews told NBR.

The terms of reference seek detailed independent information on the stability of the system both now and for the next decade, steps needed to achieve stability if it is found to be an issue, and investigating the validation and quality assurance of manually entered data, Mr Matthews says.

"The scope is also clear in that this includes the technical suitability of Novopay and its online interface, support tools, ongoing maintenance and validation. We’re happy to see the security and privacy architecture included in the scope especially in light of security and privacy issues in recent times.

"Given this is a technical review however, we hope that the actual review team will include accredited and experienced senior IT professionals, specifically with independent IT certification such as ITCP or equivalent, rather than non-IT people. This will ensure it’s a true technical review as per the scope rather than just a systems management review."

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