Backlog at State Retirement Office Gets Worse After New Computer System Installed

A costly computer upgrade at the California Public Employees' Retirement System has resulted in a downgrade in service.

The Sacramento Bee reports: "After converting to a half-billion-dollar computer system to process benefits for hundreds of thousands of California public agency retirees last September, backlogs for some services are worse than before the project launched."

The new hardware and software consolidate 49 old data systems into one. The system went into operation last year, two years late and at nearly twice the original $279 million budget. CalPERS committed another $6.8 million in December, bringing the total cost to $514 million. The money has come from CalPERS assets, currently valued at $234 billion.

"Meanwhile, fund members have complained that a system intended to speed up service and boost efficiency has done the opposite," The Bee says. "Since September, CalPERS has run into snags issuing death benefits to widows and widowers, and for a while failed to make timely payments to health insurers. The delayed payments triggered cancellation notices from the insurers, shocking retirees who thought everything was fine. CalPERS apologized and assured the members that their insurance hadn't lapsed." (Source: The Sacramento Bee, April 17.)

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