IMPACT OF IPPIS ON PAYROLL MANAGEMENT IN SELECTED MDAS IN NIGERIA

1.0 Introduction

1.1 Background to the Study

In Nigeria all the Ministries, Departments and Agencies (MDA's) draw their personnel cost from the Consolidated Revenue Fund (CRF). The exert number of Personnel being paid in the Nation cannot be easily ascertained due to non-availability of required and necessary information. As a result of none availability of the exert number of Public servants in the country, it has become difficult for government to have an accurate wage data for planning and budgeting purpose. The Integrated Personnel and Payroll Information System (IPPIS) project seeks to resolve this and also reduce the Federal Government expenditure on Overheads. In 2007, the Federal Government of Nigeria and the World Bank initiated Integrated Personnel and Payroll Information System.

The Goals set by the Federal Government include the following:

1. Implement an Integrated Solution
2. Improve human management effectiveness
3. Increase confidence in Govt. Payroll cost and expenditure management.
4. Significantly improve overall management reporting and planning.

Amongst the objectives of the reforms of Government is to entrench transparency and accountability in the public service Human Resources (HR) records and payroll administration. Successive Government has observed gross inadequacies in the payroll and personnel records in the public service. Several efforts have been made to reduce these challenges, but it tends to worsen with time, resulting to greater difference in accessing reliable data for human resources planning and management, chaotic state of pension administration; „ghost worker? syndrome and various forms of payroll and credential fraud.

Manual computation of salary and documentation of personnel information has been compounding the problem of transparency and accountability. This also affects accuracy in computation of salary hence overpayment or underpayment of salaries, omission of staff name in payment, wrong calculation of promotion and pension that is due to staff and Ex-staff as the case may be. With the introduction of the Integrated Personnel and Payroll Information System scheme, if properly implemented and managed, will go a long way in eradicating or at least bring the above mentioned problems to the barest minimum.

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1.2 Statement of Problem

Record showed that the Government of Nigeria spends almost 50 to 60% of its revenue on Personnel management every year at the detriment of other sectors of the Economy. According to the Honourable minister of Finance, Mr Olusegun Aganga in his address at the flag off of Integrated Personnel and Payroll Information System Phase II workshop held at the Sharaton Hotels Abuja, he said that in 2011 Federal Government Budget was projected at #4,226.19 billion, comprising #196.12 billion(4%) for statutory transfers; #542.38 billion (13%) for Debt servicing; #2,481.71 billion (59%) for Recurrent (Non-debt) expenditure and #1,005.99 billion (24%) for Capital expenditure. This huge bill it is said if not monitored and cut down through (appropriate government policy and reform program, we may wake up one day to see that all Govt. revenue is spent in paying salaries at the detriment of competing needs.

Ghost worker syndrome is not a new thing in Nigerian Public service, where a non-existing employee is being paid monthly. There are multiple payments of emoluments to a single employee and credentials are falsified. People have access to their age of retirement.

It is a big challenge, that at this age when almost every aspect of the world economy is computerized, Nigeria is still depending on manual records for her personnel and payroll information. Workers data are kept in paper files, their salaries are calculated manually and as such mistakes and fraud in form of overpayment, underpayment and payment of ghost workers always occur.

Government of Nigeria does not have the accurate number of civil servants and her budget is always an estimate. This has created some loop holes, whereby some ministries budget more than they require and use the excess for some other things other than payment of salary and allowances. Sometimes some will get personnel allocation that is quite less than what they need and for that reason they place some workers especially the new ones on allowances for many months thereby subjecting them to unnecessary hardship.

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1.3 Purpose of the Study

The main objective of this study is to examine the impact of IPPIS on Payroll management in selected MDAs in Nigeria.

The following are the specific objectives of the study:

1. To determine the extent to which proper implementation of Integrated Personnel and Payroll System program will eliminate payroll fraud in the Nigerian civil service.
2. To determine the possible effect of Integrated Personnel and Payroll System on Recurrent Expenditure of the Government.
3. To ascertain how Integrated Personnel and Payroll System will ensure the safety of civil servants Personnel information.
4. To determine the extent to which the Nigerian civil servants personnel records can be relied upon.
5. To find out how prepared the Government and other stakeholders are towards actualization of the Integrated Personnel and Payroll System objective.
6. To determine the extent to which the Integrated Personnel and Payroll System program will help the Government in Planning and Budgeting.

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1.4 Research Questions

1. How can proper implementation of Integrated Personnel and Payroll Information System program eliminate payroll fraud in the Nigerian civil service?
2. What are the possibilities of Integrated Personnel and Payroll Information System positively affecting the recurrent expenditure of the Nigerian Government?
3. Can the Integrated Personnel and Payroll Information System ensure the safety of the civil servants personnel information?
4. To what extent can the Nigerian civil servants personnel records be relied upon?
5. How prepared are the Nigerian government and the IPPIS stakeholder towards actualization of the IPPIS objectives?
6. To what extent can the Integrated Personnel and Payroll Information System program help the government in Planning and Budgeting?

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1.5 Research Hypothesis

HO1: Integrated Personnel and Payroll Information System will not properly ensure civil servants Personnel information safety and integrity

HO2: Proper implementation of Integrated Personnel and Payroll Information System will not significantly eliminate payroll fraud and will have no prominent effect on recurrent expenditure.

HO3: Integrated Personnel and Payroll Information System will not significantly help the Government in planning and budgeting.

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1.6 Scope of the Study

This work overviewed Integrated Personnel and Payroll Information System (IPPIS) as an Information and Computer Technology (ICT) system for the reformation of MDA service in Nigeria, its implementation and possible hindrances. The old system of personnel records, administration of monthly payroll with the new IPPIS system were thoroughly studied and discussed. Reason/s for Government reverting to the new system was discussed. The researcher used just small percentage of four Federal Government Ministries in Enugu that are among the ones already captured in the first phase of the program for the purpose of the research.

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1.7 Significance of the Study

1. The study will enable the Government to put more effort in ensuring a successful implementation of the program in order to achieve their objective and to guard against failures, lapses, sabotages and other likely challenges.
2. It will help workers to plan their income accordingly, prepare and be ready for their retirement.
3. This study will establish the fact that IPPIS program has come to improve and perfect the duties of Personnel and Payroll staff and not to displace them.
4. This research stands as an aid and basis for future researchers in this area of study.

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1.8 Definition of Terms

There is need for us to have a clear understanding of some of the key words and terms that will be used in the course of this study.

Payroll:

Payroll is the sum of all Financial records of Salaries for an employee, wages, bonuses and deductions. In accounting, payroll refers to the amount paid to employees for services they provided during a certain period of time.

Personnel:

Personnel simply defined according to the Oxford dictionary is staff; persons employed in any work, especially public undertakings and the armed forces.

Biometric Data:

Biometric data is combination of words and will be defined separately before summarizing it. According to the Longman Contemporary English Dictionary –Bio is a form of Life and living thing. Metric- concerns the system of measurement based on the meter and kilogram. Data is just fact or information. For the purpose of this research biometric data is simply Fingerprints and passports photographs captured during enrollment process.

Stakeholder:

This can be seen as a person or one who has interest (stake) in a system or is affected by or who can influence but not directly involved with the system. Stakeholders in the IPPIS project include the following; Custodian of the system, Civil servants, civil servants, operators, Personnel and Financial Information managers in the MDAs, control agencies and third party agencies e.g. FIRS, BOIR, etc.

Cadre Management:

Cadre is inner group of highly trained and active people in an organization or establishment as the case may be.

Procurement Reform:

Is to obtain especially by effort or careful attention. In this case, as it is established by the Federal Government Legislative.

Databasel:

The Librarian's Glossary compiled by L.M. Harrod defined Data to be a general term for information, used to distinguish input and output information from instructions, and also to indicate the absence, or presence, of a certain condition, such as magnetic field. Base of cause is a centre or point from which a start is made in an activity, often where supplies are kept and planes are made.