Novopay: Debt collectors to be sent to overpaid staff

Minister responsible for Novopay Steven Joyce announced the move today. Photo / Warren Buckland

Teachers and other school staff overpaid by the controversial Novopay system will be sent to debt collectors if they don't co-operate with efforts to get the outstanding $1.8m back.

Minister responsible for Novopay Steven Joyce announced the move today, after the use of debt collectors was suspended in March 2013 and those who owed less than $100 had debts written off.

That was amid an "unacceptable error rate" with the then beleaguered pay system, but its shortcomings are sorted.

"The payroll system has been working properly now for some time," Mr Joyce said.

With its error rate below 0.25 per cent, he said it was sensible to now look at how overpayments were managed.

"The vast majority of staff who received overpayments have been happy to work with us to sort that out."

So far more than 80 per cent of overpayments have been either fully repaid - $22.7 million - or are under repayment arrangements - $1.9m.

But 1960 school staff owing $1.8m have made no effort to return their excess taxpayer money.

Mr Joyce said the education sector would be briefed about the process.

Those owing money would be contacted and given time to respond or make a repayment arrangement.

If that didn't happen, debt collectors would be called upon.