Keeping the Novopay system is:
The Government says it will stick with the beleaguered Novopay system, although the future of the software remains under review.
Minister Responsible for Novopay Steven Joyce made the announcement at a lunchtime meeting in his Beehive office.
He said the decision had been made after a great deal of consideration and the improvements made so far meant it would not be sensible to change "at this point".
Since the system was introduced last August, thousands of teachers, in particular those who worked irregular hours have been underpaid, overpaid, or not paid at all.
In some instances teachers were paid for schools which had not employed them for years, while some received letters from debt collectors demanding repayment.
Problems were blamed both on the complexity of the system as well as flaws in the system, however John Rawlinson, chief executive of Novopay developers Talent2, defended the software, claiming school administrators have not fully embraced it.
Last November Rawlinson said Novopay was not hard to use but "not as easy as an Apple iPad".
Joyce said in three of the past four payment periods the error rate had been about 0.5 per cent, which he had been advised was "reasonable". However he admitted there were still improvements to be made.
The Government also announced it had written off past overpayments made to teachers where it was uneconomic to try to recover the money.
This would see up to $300,000 written off.
"The decision to stay with Novopay at this point was made very carefully after a great deal of consideration and weighing up of all the risks," Joyce said.
"The improvements we have seen in delivering school pay from pay period to pay period and the progress to date in clearing bugs, means it wouldn't be sensible to make a change at this point.
"Making a change now would increase the work for payroll administrators in the short-term during the cut-over from where we stand today, not decrease it."
The only reasonable alternative to Novopay was to switch to the old Datacom system which would also create problems, Joyce said.
"You can't just switch a complex $4.4 billion a year payroll that pays around 90,000 people every fortnight without creating more issues - no matter which system you are using."
The announcement came as Joyce announced the latest report from PricewaterhouseCoopers for the latest pay period.
Covering payments made on May 1, complaints and notifications were received regarding 0.26 per cent of staff across the country, 27 staff were notified as not paid, 80 were overpaid, and 121 underpaid.
Affected staff were from 166 schools or 6.8 per cent of schools in the payroll system.
Labour education spokesman Chris Hipkins said the announcement signalled Novopay was ‘‘here to stay’’, but this was no surprise, with the way the system was implemented.
"Hekia Parata, Bill English and Craig Foss signed off on the implementation of Novopay despite clear evidence that it was plagued with problems.
"They scrapped the contingencies that were supposed to be in place and Steven Joyce is now being left to pick up the pieces," Hipkins said.
"This whole process has caused massive disruption across the entire education system. It has had a wide-ranging impact on people's lives.
"Many of the problems could have been avoided if National ministers had done their jobs more diligently in the first place."
Are you in favour of tax cuts?