Welfare overpayments due to error and fraud to be examined by PAC

Chairman of the Committee, John McGuinness said: “Overpayments recorded for 2010 were €83.4 million – this was a 65% increase since 2007 and €25.9 million of this was classified as due to fraud. The figures for overpayments due to error and fraud are startling and should not be accepted given the dire financial state of our national finances. For example, the numbers of cases between the years 2007 and 2010 increased by only 13% while the value of overpayments increased by 65%. Between 2007 and 2010, only approximately 25% of recorded overpayments were recovered. This equated to a total of €34.5 million in 2010. The total value of overpayments due for recovery at the end of 2010 was €315 million compared to €149.5 million 2007. In 2010, recoveries were made from 50% of cases

Among the key issues we will be addressing at our meeting tomorrow are the level of recoupments made and what the Department are doing to minimise overpayments occurring in the first instance through adequate take-on controls, internal controls and fraud and error surveys. Why were recoveries made in only 50% of all individuals with debt balances? Why were not even nominal amounts recovered in the remaining 50%? Does the Department still record overpayments in their totality without further classification between fraud and error? Does the Department not think that this information would be useful? Why are so few fraud cases, referred for criminal prosecution? Would this not send a signal that social welfare fraud will not be tolerated and therefore bring future financial savings?”

Welfare and employment schemes will also be examined by the Public Accounts Committee. A total of €20.1 billion was spent on welfare schemes in 2011 with a further €1 billion on employment of activation measures – €20.9 of this came through the Department of Social Protection.

Deputy McGuinness said: “How is the Department satisfying itself that those on jobseekers payments are genuinely seeking employment? What are the consequences of refusing work and how is this monitored and what is the Department doing in terms of preparing people for work and ensuring that there is a coherent approach to placing people on appropriate training courses? These are among the questions which will be raised at tomorrow’s meeting.”

The PAC will also examine the Rural Social Scheme which was introduced in May 2004. The initial aims of the scheme were to provide income support to low income farmers and fishermen on certain social welfare payments and to provide services to the benefit of the community by use the skills of the participants. The scheme was transferred from the Department of Community, Equality and Gaeltacht Affairs to the Department of Social Protection in 2010.

Deputy McGuinness concluded: “Has the Department any plans to continue the value for money review of the scheme which the Department of Community, Equality and Gaeltacht Affairs began prior to the transfer? Has the Department considered setting target outputs for the scheme and has it any plans to carry out an audit of the administration of the scheme?”

This meeting with the Secretary General of the Department of Social Protection will take place at 10am tomorrow, Thursday, 21st June in Committee Room 1, Leinster House 2000.

Committee proceedings can be followed live at: http://bit.ly/24YmPI

Ends

For further information please contact:

Ciaran Brennan,
Houses of the Oireachtas,
Communications Unit,
Leinster House,
Dublin 2

P: +3531 618 3903
M: 086-0496518
F: +3531 618 4551

Committee of Public Accounts

Membership

John McGuinness (Chairman)
Kieran O’Donnell (Vice Chairman)
Paul J Connaughton,
John Deasy,
Paschal Donohoe,
Gerald Nash,
Simon Harris,
Michael McCarthy,
Mary Lou McDonald,
Sean Fleming,
Eoghan Murphy,
Derek Nolan,
Shane Ross