Curing the payroll cancer

The decision by the Public Service Commission (PCS) to audit and remove all ghost names from the public payroll deserves commendation.

The PSC is reported to be deploying an army of officials to go to every district and region in Ghana to head-count all government workers. This boots-on-ground approach may be fine but other things must be done as well, beyond counting.

The GRAPHIC BUSINESS, therefore, adds its voice to that of other bodies such as IMANI Ghana to suggest that the Controller and Accountant General’s Department (CAGD) must be able to enforce its mandate by making sure that it is empowered to block all fictitious payments. It is apparent that the CAGD is weak in this regard probably because it wants to avoid clashes with ministers, departmental and agency heads.

The CAGD must rethink its existing business processes to ensure that it verifies every single payment it makes since that is the only way to ensure accountability.

The Ministry of Finance’s laxity in the provision of a verification functionality or oversight on Controllers could implicate them in abetting the losses.

There is the need  for a really strong action to ensure the sanctity of government payroll as dependence on insufficient Social Security and National Insurance Trust (SSNIT) records by CAGD as a control is not satisfactory because it still leaves loopholes.

If ghost names can be found on the national payroll, it would not be surprising if the current SSNIT records are also infected with such fictitious names.

All ministries, departments and agencies must be asked to sign legal consent forms as part of the pay-run process before any payments are made.

We should introduce quarterly audits by a third party on the payroll records as part of the new process to stop new 'cases' from slipping in.

Random payroll auditing exercises should be seen as an important complement to the government’s efforts to raise revenue, because just as it is important to raise revenue, it is also important to promptly detect leakages of revenue through payroll fraud.

The tendency for accountants, payroll officers, bursars, head teachers, principals and internal auditors to remain at one post for long periods (some until their retirement) adds greatly to their ability to form payroll syndicates and conceal serious acts of wrongdoing.

In addition to random auditing, the tenure of officers who are in a position to manipulate payroll records must be reviewed and their annual leave made mandatory. Within the CAGD, a rotation policy of staff working on the records of specific ministries, departments, and agencies should also be considered.

 Payroll fraud also calls for credible deterrence. There is no deterrence if those who are found engaging in such practices are only asked by the courts to refund the amounts stolen, often at their convenience. 

The delays in the courts and the perception of the soft handling of such cases brought forward by the Serious Fraud Office diminish the expected cost of payroll fraud to those who engage in such acts.

If Liberia, which not too long ago emerged from 14 years of civil war, has smartly opted to use biometrics to check payroll fraud, why can’t Ghana do the same? Biometrics is the technology that measures individuals’ physical or behavioural characteristics as a means of identification. 

It takes precise measurement of, for example, an individual’s eyes (iris and retina scans), hands or voice, digitises the measurement, stores the information in a computer memory and later compares it against the same measurement when taken later.

It is extremely difficult, if not impossible, to duplicate individual physical measurement or scan, so biometrics is what must be applied in many security-sensitive areas, including payroll systems. 

It can have very wide application in the ministries, departments, in the health care and educational sectors across the country. 

Linking the unique identification to the Controller and Accountant General’s database, social security records and a national identification card will be an even better way to prevent the massive financial fraud the government suffers. GB