After a recent audit found significant accounting, technology, and funding issues in Pennsylvania’s unemployment compensation system, the Wolf administration is attempting to correct its course.
But it’s not going to be an easy — or quick — process.
Lawmakers are already expressing frustration with the amount of information they’re getting about the system’s financial decisions.
At an often-tense House Labor and Industry Committee meeting, Auditor General Eugene DePasquale rehashed some of the findings from his office’s April report. His team concluded the unemployment compensation system failed to properly track how it spent nearly $200 million in state money, much of which was supposed to go toward fixing a perilously outdated computer system that’s still in use.
Attempts to update the unemployment compensation computers have been repeatedly stymied. A contract with IBM that failed under previous administrations cost the state millions and compounded the system’s fiscal problems, which eventually resulted in hundreds of layoffs last year.
DePasquale told lawmakers he doesn’t see a way around allocating more money to the unemployment compensation system to finally update infrastructure and bring back employees permanently.
Asked by Washington County Democrat Brandon Neuman what would happen “if we give no more funds to the department of Labor and Industry for UC?” DePasquale responded bluntly.
“If nothing is done, you’re playing Russian roulette with the lives of the people who are in that system,” he said.
The Department of Labor and Industry — which oversees the unemployment compensation system — is in the process of finalizing a $22.5 million contract to modernize the computer system, according to a bid award posted by the administration.
But lawmakers including Franklin County Republican Rob Kauffman, who chairs the House Labor and Industry Committee, said they’re worried the agency is spending too much.
“I think the Department of Labor and Industry needs to slow down, especially when they’re looking for additional funds from the legislature,” Kauffman said. “We’ve been through a lot with the department … and so we have to be very diligent in our study with what they present us.”
Deputy Secretary Robert O’Brien said the department will have a more comprehensive plan out later this month detailing its next steps forward.