Ottawa is facing growing concerns that its rollout of a new benefits system, Cúram, could mirror the disastrous implementation of the Phoenix pay system, a decade-long saga that has plagued federal employees. The union representing the largest number of federal IT workers warns that , some 85,000 new benefit applications were already backlogged.
The Cúram software, purchased in , is intended to modernize the delivery of Old Age Security, Employment Insurance and the Canada Pension Plan. However, early signs suggest the project is running into significant difficulties, echoing the problems experienced with Phoenix, which continues to leave hundreds of thousands of transactions unprocessed, with nearly half outstanding for over a year.
Employment and Social Development Canada (ESDC) stated that it “continues to mobilize all available resources to reduce wait times,” and that “the oldest and most urgent cases in the inventory are being prioritized,” according to spokesperson Maja Stefanovska. The department insists that no beneficiaries will be penalized or miss payments due to the delays.
However, reports indicate that vulnerable seniors have already experienced unjustified suspension of benefits, while some recipients have received overpayments exceeding $10,000, according to a report obtained by Radio-Canada from the Union of Employment and Immigration. These issues are fueling criticism from opposition parties.
Bloc Québécois parliamentary leader Christine Normandin expressed fears of a surge in distress among citizens reliant on the system, and a corresponding increase in costs. “When the government touches IT and outsources to private companies rather than keeping expertise in-house, it becomes completely chaotic,” she stated.
The Bloc Québécois is calling for a public inquiry into the Cúram implementation, while the Conservative Party suggests alternative parliamentary mechanisms could expedite a review of the project.
What is Cúram?
The initial cost estimate for the Cúram project was $1.75 billion. Current projections now place the total expenditure at $6.6 billion. Deloitte has secured the largest contract as the system integrator, having received $388 million to date.
The system is designed to replace multiple IT systems, some of which are reportedly 60 years old.
Warning Signs
Last year, Radio-Canada reported that federal officials were unprepared to use the new platform, with training described as “improvisation” by one source. The source claimed that training consisted of only “bits of functionality” being demonstrated. Despite these concerns, Susan Ingram, the assistant deputy minister responsible for the benefit modernization program, assured that the software would not be launched without “conditions of success” being met.
Now, the government maintains that the delays in processing applications are “not related to the functioning of the new Cúram system.” However, service standards require 90% of Old Age Security benefits to be paid within the first month of eligibility. Data from ESDC shows that only 80.5% of benefits were paid within the first month between and .
Stefanovska argues that these cases “cannot be considered underpayments” as not all applicants will ultimately be eligible for Old Age Security, and that payments will be issued retroactively once applications are processed.
Towards a Phoenix 2.0?
The cost overruns and reliance on outsourcing are prompting concerns that Cúram is following a similar path to the Phoenix pay system. Sean O’Reilly, president of the Professional Institute of the Public Service of Canada (PIPSC), argues that the government is “taking the same route” with Cúram as it did with Phoenix.
Currently, 233,000 transactions for federal employees remain unprocessed in Phoenix, with almost half outstanding for more than a year. Some employees are still awaiting reimbursement for tens of thousands of dollars.
At a press conference marking the 10th anniversary of Phoenix, O’Reilly expressed fears that “the anxiety, pain, and suffering that public servants have endured [is now] being imposed on millions of Canadians who rely on benefit payments.”
O’Reilly believes the Phoenix debacle demonstrates the necessity of maintaining internal expertise. “If the system had been designed by public servants from the outset, it would have been easier to maintain and understand, as the experts would have been in-house,” he stated. He criticizes the federal government for a lack of trust in its workforce when undertaking large-scale IT projects.
“IT professionals want to work on these projects and are frustrated when they are awarded to private contractors,” O’Reilly added. “IT sees a contractor arrive, deliver a half-functional system, and then they have to fix the problems afterwards.”
While acknowledging the need for modernization, O’Reilly stresses the importance of the government “rebuilding a strong IT workforce internally” to prevent future failures.
