The Navy's Computerized Pay System Is Unreliable and Inefficient--What Went Wrong?

FGMSD-80-71: Published: Sep 26, 1980. Publicly Released: Sep 26, 1980.

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Over the last 12 years, the Navy has spent more than $150 million to develop and operate a central automated military pay system that is largely unreliable and inefficient. Although GAO approved the system design, it is not working as designed because it was not implemented as designed.

Two studies conducted in 1978 revealed that 42 percent of 291 selected pay accounts reviewed were inaccurate and 52,200 accounts remained in an overpaid status for more than 90 days. In 1979, GAO found that 34 of the accounts were in error in amounts ranging from $5 to over $1,800. The major problems with the system stem from the lack of timely and accurate input data from field organizations to the central computer. Field units average 12 days to prepare input as opposed to the 3 days required by the system design. The approved system design required an automated control over rejects, but management does not rely on it for control purposes because the automated system was not properly implemented. Navy management did not establish overall goals and objectives to measure pay system performance as required by the Assistant Secretary of Defense (Comptroller). The Assistant Secretary's office did not provide the necessary guidance and monitoring of the Navy's pay system development and implementation, or require the Navy to comply with the Department of Defense requirements for managing the automated pay system. It has not determined whether the Navy implemented the pay system design as approved by GAO. Changes made in creating a parallel manual system would not have been approved by GAO if the changes had been submitted to GAO as required. The quality of the input was also very poor. Despite costly efforts to overcome system inefficiencies, the system continues to operate inadequately.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to comply with all Defense policies and procedures in future work now planned to correct the problems with the automated pay system.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to ensure that internal auditors periodically report to top management on the progress responsible officials are making toward operating the system as designed and in meeting the established goals and objectives.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to comply with Defense requirements to carry out the policies prescribed for developing and operating the military pay system.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to set a standard for when an override of computer-produced Leave and Earnings Statements by all local disbursing officers can take place. This standard could vary with the rank of the member.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to identify those organizations which submit untimely and erroneous pay data and take corrective action as indicated.

    Agency Affected: Department of Defense

  6. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to strengthen supervisory controls over pay technicians' resolutions of system rejections.

    Agency Affected: Department of Defense

  7. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to expedite the Navy's plans to transmit input data to the Finance Center electronically rather than by mail.

    Agency Affected: Department of Defense

  8. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to improve the reliability, efficiency, and effectiveness of the Navy's military pay system by requiring commanding officers, disbursing officers, and administrative officers to operate the pay system as designed and as approved by GAO. Target dates should be established for reducing the extent of the manual effort now required to make the system work. As the automated system becomes more effective, reliance upon the manual system should be considerably reduced, thereby eliminating the parallel manual system.

    Agency Affected: Department of Defense

  9. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should require the Secretary of the Navy to establish procedures to measure system effectiveness. This should include defining goals and objectives in measurable terms, identifying applicable performance indicators to be measured, and developing standards against which performance can be measured. At the same time, responsible officials should be required to operate the pay system as designed and as approved.

    Agency Affected: Department of Defense

 

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