Biometrics for better government finances

Nigeria saves $11 million after removing 20,000 ‘ghost workers’ (Hindustan Times)

Nigeria’s government has removed more than 20,000 non-existent workers from its payroll following an audit, leading to savings of 2.29 billion naira ($11.53 million) from its monthly wage bill, the Finance Ministry said on Sunday.
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The audit used biometric data and a bank verification number (BVN) to identify holders of bank accounts into which salaries were being paid.

Pakistan: Ghost workers in Sindh

Over 25,000 'ghost' teachers identified in Sindh Education department (Geo.TV)

Sources said that, during investigation carried out by AG Sindh office and Education Department, about 25,000 out of 155,000 recorded employees have been identified as ‘fake’ in the Sindh Education and Literacy Department.

They added that ghost employees were identified by the Deputy Accountant General Education, security and examination committee with the support of biometric system.

We haven't posted on ghost workers lately, but a 16% fake employee rate is noteworthy.

Whose ghosts are these?

KENYA: Government officials to be probed over 12,000 ghost workers (Daily Nation)

The Cabinet has ordered government officials be investigated for allegedly colluding to pay 12,000 staff unaccounted for after the conclusion of the biometric registration exercise.

Fighting corruption in East Africa

'Ghost workers': Kenya biometric register launched (Bor Globe)

Kenya has started biometrically registering all civil servants in an attempt to remove "ghost workers" from the government's payroll.

Biometrics detect more Nigerian ghosts

Delta Bio-metric Payroll System Uncovers Scam (Spy Ghana)

The Automatic Fingerprint Identification System (AFIS) of the Delta State Biometric Payroll System has uncovered 17 staff from the Women Development Committee (WDC) and Youth Development Committee scheme (YDC) who were collecting salaries from both agencies.

Nigeria: The ghost worker numbers in this piece are shocking

Boyo: Ghost workers and indulgent exorcists (The Guardian - Nigeria)

♦ A 2010 staff audit of the Nigeria Police Force revealed over 100,000 ghost police officers out of 330,000 officially registered policemen.

♦ In 2011, the Rivers State Universal Basic Education Board reported losses of N2.4 billion (approx $26 million) annually to 1,477 ghost workers

♦ In the same month, after conducting a biometric audit, The National Identity Management Commission uncovered 4,000 ghost workers out of about 10,300 employees on its payroll.

♦ The Ekiti State government loses over N3 billion annually to ghost workers out of a projected annual budget of N80 billion.

There are many more examples at the link.

Ghostbusting: Communication is key

SIERRA LEONE: Total Misinformation About Rumoured Deletion Of 7, 000 Teachers From Pay Vouchers (Cocorioko)

The Minister of Education, Dr. Minkailu Bah, was the first to challenge those figures, stating that they were too alarming and therefore subject to further verification by his ministry. The Minister therefore suggested that a Task Force, comprising the staff of the firm that carried out the registration; his ministry’s staff and representative from the Sierra Leone Teachers’ Union (SLTU) should conduct a follow up re-verification exercise that should last for 90 days. He asked that Heads of Schools and Proprietors be sufficiently notified so that they too could notify all Teachers on their lists.

During this second phase of verification, Teachers who refuse or do not make themselves available to be properly verified would eventually be deleted from the government pay vouchers, the Minister cautioned.

The SLTU Representative was given a soft copy of this report. Somehow, these representatives from the SLTU decided to send a message to all Teachers around the country, particularly those whose names are on the list for re-verification (7,761), notifying them that they have been maintained as “Ghost Teachers” and therefore their names are going to be deleted from the government pay voucher.

Misinformation shenanigans can't be ruled out but when people's jobs are on the line, emotions can run hot. Good communication about the process can help a lot.

Biometrics and ghost workers in Nigeria

Abia’s scourge of ghost workers (The Nation)

When Abia state governor Chief Theodore Orji introduced reforms in the civil service of the state which include promotion of workers due for promotion, approval of N21,000 as minimum wage, retiring those due, transferring of service of non-indigenes to their states of origin after due consultation with their home state, and insistence on biometric data capturing of all workers and pensioners in the state civil service, some cynics who believed in business as usual criticised the reforms severely.

Read the whole thing.

Nigeria: One state losing $400,000 per month to ghost workers

Nigeria: Ekiti Loses N63 Million to Ghost Workers Monthly (All Africa)

[... T]he first physical verification exercise showed that there are 19,258 personnel in the 16 local government areas, while subsequent biometric data capture revealed that there are 19,212 staff.

He said a further check showed that there are 17,889 staff on the nominal roll while 1,323 staff collecting about N63 million on a monthly basis are not on the nominal roll.

Adewumi stated further that for efficiency at the third tier of government, the state government has decided to redeploy 1,756 workers who have National Certificate of Education (NCE) and other education-related qualifications to the State Universal Basic Education Board and the Teaching Service Commission.

This, the commissioner said would relieve the councils of a monthly financial implication of N53 million.

Biometrics bust 9,000 more ghosts in Nigeria

Katsina discovers 9,000 ghost workers (Vanguard)

ABUJA—GOVERNOR Ibrahim Shema of Kastina State has said his government discovered 9,000 ghost workers on the payroll of the state.

Shema, who addressed stakeholders in Abuja, promised that his administration will do everything possible to stamp out the ghost workers syndrome in the state.

He explained that before the implementation of the payment of N18,000 minimum wage, his administration embarked on the biometric capturing of the civil servants in the state.

I'd guess that Nigeria has been the country most aggressively applying biometrics to reduce fraud in government payrolls.

How noisy are ghosts?

Ghana: Biometric Payroll Underway (GhanaWeb)

“We, however, wish to assure genuine public servants who may not have taken part in the biometric registration exercise, and therefore have not received their salaries for July, that payment will be duly made to them.”

The release said “such public servants are therefore encouraged to quickly go to the nearest Regional Office of the Controller & Accountant General’s Department or to the Ministry of Finance and Economic Planning, Annex (FIC Building), Accra where they will be immediately registered and their payment quickly processed.”

It'll be interesting to compare the volume of complaints to the length of the lines at enrollment stations.

Nigeria: Ghost Workers Will Haunt Administrators

Senate President Berates Pension Administrators (This Day Live)

The Senate President, who was represented by the Senate Leader, Senator Victor Ndoma-Egba, said: “These people, the administrators stealing pension funds, can never live in peace because the prayers of these old men and women who have diligently served the country will haunt them and their children’s children. I implore the committee to unravel all the issues pertaining to the mismanagement of pension funds in the country and bring the perpetrators to book. Let me assure that this committee has the full backing of the Senate on this.”

Meanwhile, Obada who made gave the assurance to some of the retirees in Lagos at the ongoing annual verification exercise being held at the grounds of the Nigerian Army, 9th Brigade, Ikeja, said: “The yearly verification exercise is to ensure that we are paying the right people and not ghost retirees. We insist it to checkmate relatives of deceased retirees from claiming the benefits of a dead person.”

THISDAY gathered that the verification exercise which began yesterday, would involve biometric data capture.

Obada said: “This exercise will involve the biometric data capture which includes the iris scan and finger print capture.”

See also Nigeria: Biometrics Generate $965 Million in Pension Savings

Nigeria: Biometrics Generate $965 Million in Pension Savings

FG Cuts Spending (This Day Live)

She also disclosed that the Pension Task Force made a recovery of about N151 billion following the use of the biometric verification system in plugging leakages occasioned by the menace of ghost workers in the public sector.

Today: 151,000,000,000.00 NGN = 955,998,752.25 USD. That's some heavy ROI.

Innovations for Successful Societies: Liberia, Civil Service & Biometrics

Cleaning the Civil Service Payroll: Post-Conflict Liberia, 2008-2011 (Princeton.edu)

William C. Allen, director general of the Civil Service Agency (CSA), reflected on his time as minister of information in Liberia’s transitional government from 2003 to 2005.

“On any given day I would come into the office, I would see about 60 persons,” he recalled. “I was in my office one day and I heard this noise and a drove of people in the hallway.

I said, ‘What is going on?’

They said, ‘Today is payday.’

I went out there and I tell you I saw faces and people that I had never seen in my life. They had occupied the entire stairwell. I said, ‘Gee, if I had all these people working every day at least I could do something for this country.’ So right there I knew I had a problem.”

Jonathan Friedman has put together a superbly-written and detailed narrative on the use of biometrics to foster efficient civil service by weeding out ghost workers. The quality of the writing shines through. The level of detail doesn't overwhelm this story of innovation which Mr. Friedman tells in a compelling way,.

Download full PDF here (10 pages).

France: Ex-president Chirac Guilty of Corruption in Ghost Worker Scheme

Given a two-year suspended jail sentence (France24)

Former French president Jacques Chirac was given a two-year suspended jail sentence on Thursday after he was convicted of embezzling public money to finance his political party.

Sentenced for creating fake civil service jobs while he was mayor of Paris between 1977 and 1995, Chirac is the first former French President to be convicted of a criminal offence since the Second World War.

It seems that money most often motivates the creation of ghost armies of public workers. For Chirac, diverting public funds to his political operation accomplished much the same outcome.

Developing nations aren't the only ones that can help safeguard democracy using biometrics.

Slate: How Biometric IDs Will Help Developing Countries Fight Corruption and Bust Fake Workers.

I’ve Got My Eye on You (Slate.com)

Call 2011 the year of the biometric ID. Once the territory of high-security enclaves and spy novels, identification by iris scan, fingerprint, and other unique physical features has now become de rigueur around the world—especially in India, whose program to ID every citizen has been the subject of almost giddy reports about the technology’s potential to democratize society. The New York Times described India’s biometric database as “building real citizenship” for the first time. Wired emphasized how biometrics can finally bring the disenfranchised into the formal economy. The New Yorker detailed the necessity of IDs for the poor in accessing formal savings opportunities.

But entirely underemphasized is another major upside of biometric IDs and the shift to electronic payments: solving the ghost-worker problem.

Slate has a great article on using biometric ID management technologies in developing countries to help interrupt the corruption-poverty feedback loop.

The themes, and even some of the article's linked material, will be familiar to regular readers but the article contains detail on specific implementations and makes a compelling case for more widespread adoption.

Other posts on Biometrics & Development

Management Lesson from Nigeria

Biometrics, Ghost Workers, ROI and Sharing the Savings (Vanguard, Nigeria)

It must be recalled that members of the National Union of Electricity Employees, NUEE, had initially opposed the biometric data capturing system introduced by the government, and threatened industrial action if the measure was carried out. The union, however, rescinded its decision after reaching fresh agreements with government on Thursday, regarding the payments of the 50 percent salary increases for electricity workers.

and

The Federal Government has directed the PHCN management for the first three months of the 50 percent hike in salary, adding “this singular action has cost the entire labour movement an enormous stock of goodwill, as it is so embarrassing and brazen.”

He said that between 30 and 40 percent of the workers in the federal service has been discovered to be fake, since the Federal Government last year directed all ministries, departments and agencies to conduct biometric data verification which entails collection of photographs, thumbprints and staff numbers of employees.

I've used this space over and over to contend that the proper measure for the success of a biometric deployment is not perfection; it's return on investment (ROI).

The reason that so many of the early applications of biometric technology to business processes have been in time-and-attendance systems is because the ROI calculation is pretty straightforward.

Applying biometrics to root out ghost workers in the Nigerian electricity industry should deliver a hefty ROI but it is important to realize that every time an organization saves money, someone who used to get paid isn't getting paid (or isn't getting paid as much) any more. In this case, some of the people receiving the salaries of the ghost workers may also be real workers, too, and their legitimate wages may be very low.

This type of arrangement may even have been met tacit acceptance by managers who had no other way to mete out salary increases but it also opens the door to abuse, theft and a loss of managerial control of labor costs.

Fortunately, cleaning up the payroll frees up the resources to make some people whole while severely curtailing large-scale abuse. Without the ROI biometrics affords, there aren't a lot of good options for addressing the problem without killing morale.

Fortunately, most businesses are not faced with a time-and-attendance challenge where 30% of paid staff don't actually exist, but the above example is instructive nonetheless.

Astute managers might consider setting aside some portion of biometric time-and-attendance ROI to smooth the transition from a system that had a little more slack built into it.

Nigeria: Biometrics Brought in to Detect Ghost Workers. Staff Destroys Equipment.

Major shake-up looms in Abia local government system (next)

"You are part and parcel of the problem we have in the local government system.

"We decided to clean up the system to detect ghost workers, but you fought the people we brought and destroyed their biometric machines," he had said

Orji also said that the State House of Assembly had already intervened in the matter, stressing that the state government would implement whatever recommendation made by the legislators on the matter.

What Human Resource Managers Can Learn from the President of Guinea's Move to Eliminate Ghost Workers

Guinea President Announces Plan to Clean up Military, Pensions (Africasia.com link inactive)

Guinea's military has been a strong destabilising force since independence, with many leaders achieving power by coups until the nation's first democratic elections in November 2010, won by Conde.

His first task has been to reform the defense sector, and an army which the International Institute of Strategic Studies estimated in 2010 has some 12,300 troops.

"This is not a witchhunt, but we need a change in mindset, which is difficult. All Guineans are set in ways which are not conducive to good governance," said Conde.

He has raised the grade of the retiring officers to improve their retirement benefits, and said his government was carrying out a biometric census in government to do away with ghost employees and other irregularities.

This article is yet another in a long litany of stories about using biometrics to get rid of ghost workers. But this article is interesting in that it hints at an often overlooked managerial tactic for realizing the benefits of strengthened identity management systems.

An organization only has so much money to reward employees. To the degree that those resources are diverted to non-productive ends (i.e. ghost workers) there is less available to compensate those who serve productive organizational ends.

From a management perspective, it's easy to see how demoralizing this could be to those who simply wish to work hard in service to their country for fair compensation.

The president of Guinea, has made an astute management decision in this case. He has raised the retirement benefits of legitimate workers at the same time he has set out to eliminate ghost workers.

Adopting more efficient ID management systems creates winners and losers. In this case the losers are those who receive the ghost workers' salaries. While these individuals aren't necessarily sympathetic characters, they aren't necessarily powerless, either. By sharing the financial benefits of of better ID management with legitimate workers, the president of Guinea has created an "army" of organizational allies as he attempts to change the finances and culture of the military.

This has applicability to the corporate world and time-and-attendance biometrics, as well.

See:
Farm of the Week: Producer clocks in with IT system to control costs

"It might sound hard, but more accuracy means more fairness, for both staff and customers," says Mr Machin. "Thirty percent of our costs are labour. The more we pin costs down, the more choice we have about how to distribute rewards. [Emphasis mine] And the better we get at pricing our produce, the more customers we bring in."

In order to achieve top to bottom buy-in, a manager should consider distributing the benefits associated with better identity management techniques among shareholders, managers and workers.

A bonus for on-time attendance (for example) might raise the morale of workers who were always on time, while offering some consolation to those who saw their ability to milk the system reduced.

A spoonful of sugar helps the medicine go down.

South Africa audits old biometric data with new technology

Department of Home Affairs (DHA) and its Home Affairs National Identification System (ITWeb.co.za)

The department identified 598 000 instances of duplicate IDs. It has now resolved 412 096 cases where one person had multiple ID numbers and 20 971 cases where multiple persons shared one ID number.

Applying new identity management techniques to existing systems and databases can yield impressive results leading to a significant return on investment.

It's also interesting to compare the number of "extra" ID numbers generated to the number of people that were issued someone else's number in error.

There were more than 28 instances of extra ID numbers issued to people for every instance of assigning the same ID number to multiple people.

There are many reasons for this including simple error. If two people have the same ID number, someone is likely to become inconvenienced and bring the matter to the attention of the authorities. If someone loses their child's documents, they may just start the ID process over again, getting a new number and the old number never gets used. So innocent errors of one type (people sharing an ID number) are far more likely to be corrected than the other type (more numbers than people).

Another reason for the difference in the quantity of each type of error, however, is fraud. The ghost worker fraud depends upon creating extra ID's for people that don't exist and then either hiring them to work for some publicly funded entity or enrolling them to collect some sort of social welfare benefit.

I suspect that the bigger part of the difference in observed database error rates is fraud.