Dáil debates

Wednesday, 31 May 2017

Ceisteanna - Questions (Resumed) - Priority Questions

Social Welfare Fraud Cost

2:05 pm

Photo of Willie O'DeaWillie O'Dea (Limerick City, Fianna Fail)
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26. To ask the Minister for Social Protection the way in which the figure of €506 million given in the "welfare cheats cheat us all" campaign is calculated; and if he will make a statement on the matter. [26051/17]

Photo of Willie O'DeaWillie O'Dea (Limerick City, Fianna Fail)
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In tabling this question I wish to make it very clear that I fully support the hardest possible line being taken against social welfare fraud, a particularly dispicable form of crime. However, I am somewhat confused about what the anti-fraud campaign seeks to achieve and how it will achieve it, hence my question.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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My Department has compiled and published data and reports on its control, compliance and anti-fraud work annually for a number of years. The calculations used are well grounded and underpinned by a recognised methodology. They are a performance management metric used to monitor the progress of control, compliance and anti-fraud work in my Department. The overall metric consists of overpayments and savings that arise from internally initiated reviews and investigation activity.

The total value of control and anti-fraud savings recorded by my Department in 2016 was €506 million. This figure represents the outcome of nearly 950,000 reviews and investigations undertaken by my officials across the board of schemes and programmes. Such savings will only be recorded in cases where a social welfare claim is reduced in value or terminated following a review or investigation initiated by the Department. The basis of the savings calculated is scheme-specific. The nature of the scheme is taken into account, in particular whether it is short-term - for example, jobseeker's benefit or supplementary welfare allowance - or more long-term such as the State pension. This takes into account the length of time a person who has a claim reduced or terminated is expected to remain off a particular scheme or at the reduced rate of payment. The multipliers used in these calculations are based on observed behaviour and historical data for claims. If there is a reduction in the value of the payment or if the payment is terminated, the sum overpaid is calculated and put to the claimant and, if accepted, recovery actions commence soon after. As for future payments, only the difference between the current value and the previous value is counted. This difference or the full value if the payment is terminated, together with the expected number of weeks a person remains off a payment, is used as the basis for the calculation of the savings achieved for the future. As I have outlined, he number of weeks varies between long and short-term schemes. If a person disagrees with our decision, he or she can seek an appeal to the social welfare appeals office. Only the final outcome is considered.

The methodology has been developed by my Department with support from the Central Statistics Office and is based on similar methodologies used in a number of countries such as the United Kingdom and Australia. It is kept under review to reflect the changes in claim patterns. The Department will examine the methodology in the context of renewing the compliance and anti-fraud strategy 2014 to 2018.

Photo of Willie O'DeaWillie O'Dea (Limerick City, Fianna Fail)
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In a previous written reply the Minister told me that the breakdown was between overpayments and pure fraud necessitating a prosecution and that the figure attributable to pure fraud was €41 million out of the sum of €506 million. I have some concerns about the nature of the anti-fraud campaign and the follow-up which we will discuss tomorrow at the social welfare committee, particularly the publicising of lists. I do not know how this will prevent future potential social welfare fraudsters. A comparison has been made between the proposed list and the Revenue list, but there is a fundamental difference between the two. Most Revenue defaulters do not go through the courts; there is a settlement with the Revenue Commissioners. If the list is not published, people will never know that the settlement took place. In the case of social welfare fraudsters, people are invariably prosecuted and their cases go through the courts. The courts are public and, as the Minister will be aware, cases are always widely publicised at national level and receive much publicity at local level. There are many other criminal activities such as murder, fraud unrelated to social welfare payments, armed robbery, etc. When these cases take place, they are all publicised, but if subsequent publicisation would deter people from committing such crimes in the future, perhaps it is a system we might use across the board.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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As the Deputy knows, we will have a chance to discuss this issue tomorrow at the committee. I do not disagree with him. If publicised lists make sense in dealing with this type of fraud and crime, why would it not also make sense in dealing with others? This campaign and the additional measures we propose to take are all designed to deter people from engaging in welfare fraud in the first place. To clarify some numbers that I know are in the public domain - I have seen them carried in some of the newspapers and online - the figures given by my Department for suspected identity fraud were not correct. I see some coverage in the newspapers today suggesting there has been only one case of suspected identity fraud this year. That is not the case. In fact, there have been 11 such cases. There were 46 last year, 54 the year before and 29 the year before that.

Photo of John BradyJohn Brady (Wicklow, Sinn Fein)
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The figures came from the Minister's Department.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Yes, I accept that. My Department gave inaccurate figures. The level of suspected identity fraud is, in fact, 11 times higher than the figures we incorrectly gave to the House the other day. I will give them again. There have been 11 cases so far this year. There were 46 last year, 54 the year before and 29 the year before that, which gives a total of 140 in the past three and a half years. Identity fraud is one of the less common forms of attempted fraud. It is much less common than working and claiming, for example.

Photo of Willie O'DeaWillie O'Dea (Limerick City, Fianna Fail)
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The ministerial brief which the Minister received on his accession to office and which was shared with the rest of us details seven full pages of anti-fraud control measures in which the Department is engaged. It also gives us the interesting figure that more than 1,000 staff in the Department are employed directly in the control area and that 1.1 million reviews took place last year. Therefore, there is much ongoing activity. As I said, I will return to the matter with the Minister's officials tomorrow when we debate this section. The idea is to publish the list within three months after the end of the quarter in which the offence is successfully prosecuted and the offender convicted. What is there to prevent others from using the list and consistently publishing and republishing it constantly? Can the Minister give us any guarantee in that regard?

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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What we will discuss tomorrow are the heads of a Bill. We will have a chance to go through the issue in more detail then. The intention is that the list would be published on a quarterly basis after the convictions have been secured but would not appear on the website in perpetuity, that it would be taken down after a period. As is the case with any information in the public domain, of course, people could retain it and make use of it into the future. However, as the Deputy pointed out in his initial comments, the media organisations very often cover convictions related to welfare fraud and the same applies in this instance: people could save the information and keep it for the future.