"Zambia: Review of the Government Payroll Management System"


  • SOLICITATION NUMBER: 0002019647
  • INSTITUTION:  IBRD/IDA
  • ASSIGNMENT LOCATION: Zambia
  • ISSUE DATE AND TIME: Dec 01,2025 05:08
  • CLOSING DATE AND TIME: Dec 23,2025 23:59

Zambia has made significant progress in digitizing civil servant salary payments through the Payroll Management and Establishment Control (PMEC) system; which integrates payroll processing with human resource management to enhance transparency; efficiency; and accountability. However; challenges remain; particularly the lack of integration between the Human Resource Management Information System (HRMIS)/PMEC and the Integrated Financial Management Information System (IFMIS); leading to inefficiencies; manual interventions; and risks of fraud. The government-to-person (G2P) payment ecosystem still relies on manual processes; making payroll expenditure management and establishment controls vulnerable to errors. The transition to a fully digital system presents opportunities to enhance transparency; reduce fraud; and improve overall efficiency in the management of public funds. Zambia allocates approximately 30% of public expenditure to the wage bill; consuming around 40% of total revenue; with an average monthly cost of K2.5 billion.  There are multiple central government agencies involved in the payroll cycle: Public Service Management Division (PSMD); under Cabinet Office; is responsible for maintaining the establishment register; recruitment and seeking treasury authority; the Civil Service Commission provides appointment letters and PMEC which operates the payroll system. While PMEC operates under PSMD; it has dual reporting; for HR related issues it reports to PSMD and finance and accounting transactions to the Office of the Accountant General; in the Ministry of Finance and National Planning. The current PMEC system (SAP Enterprise resource planning system) comprises five (5) modules namely: i.     Organizational Management Module used for maintenance of the organizational structure (Establishment Control); ii.             Personnel Administration used for maintenance of payroll information; iii.     Personnel Cost Planning Module used for conducting personnel cost planning;iv.        Payroll Management Module used for payroll management including processing of salaries; andv.          Technical Support Module used by Information Communications and Technology (ICT) staff to provide technical support. A special audit of the government payroll (2017-2021) was published by the Auditor General in 2022. The results of this audit showed several challenges with payroll controls including irregular recruitment; irregular payment of allowances and failure to reconcile the salaries account. The Auditor General specifically made reference to the weaknesses in internal controls relating to removal of separated officers; disposal of disciplinary cases; renewal of diplomats’ contracts; administration of inputs and system configurations; manual preparation of personal emolument’s budgets as well as failure to adhere to Government policies such as Treasury and Financial Management Circular No. 9 of 2020. Following this audit; PMEC embarked on reforms to strengthen the payroll control environment and reduce the risk of fraud and irregular payments. Some progress has been made to date; including the introduction of streamlined business processes and strengthened internal controls.  However; there are still gaps remaining; including system inefficiencies which delay updates and can result in prolonged salary payments to resigned; retired or deceased employees and compliance challenges with internal procedures such as control structures and payroll change procedures. PSMD and MOFNP; in collaboration with PMEC; with support from the World Bank and the Government to Person (G2PX) Initiative; intends to address these challenges and inform future priorities for improvement and reform. This assignment will contribute by conducting a current state assessment of the Zambia government payroll management system and providing actionable recommendations to support further reforms. The Modern G2P Architecture Framework will be the starting point for the assessment. The G2Px architecture framework is a conceptual approach rather than a fixed blueprint; guiding countries to build their own robust; inclusive digital payment systems by focusing on user needs; interoperable digital public infrastructure; and sustainable economic and social outcomes.

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