Joan Burton (Dublin West, Labour) | Oireachtas source

Different parties and individuals have different views on this matter. As well as having a responsibility to those who rely on a social welfare income, I have a responsibility to those who pay PRSI, income tax and other taxes to ensure payments go to the right people in the right amount.

To give members an indication of the percentages involved, approximately 42% of overpayments arise as a result of fraud - in other words, people who claim something to which they are not entitled. Third-party error accounts for 37% - people misstate their circumstances unintentionally or their circumstances change and they forget to advise the office. The departmental error level is about 8%.

It sometimes arises that after a person has passed on they are found to have left a very significant estate behind while they were collecting a means-tested social welfare payment. It has been the practice over a very long period to recover those funds from estates. When I came into office as Minister, €2 a week could be recovered. It was offensive to people living in an estate where one person was known to have significantly defrauded the Department. If a person wished to co-operate, as has always been the practice, he or she could pay significantly more. When mistakes have been brought to people's attention, most have volunteered to pay significant sums back as soon as they could, commensurate with their means, and that is quite carefully done, but some people have given the two fingers to the Department, paid back €2 a week and left the Department waiting 20 years for the money. The people living beside them in the same estate are working and paying tax and PRSI while those people are giving two fingers to the Department. We should bear in mind that last year the recoveries involved amounted to more than €70 million. About half of that is recovered by direct deduction. We have made changes in the law to provide that if a person has moved on and gone to work, we can still recover moneys from him or her.

In an examination that was carried out in conjunction with the Revenue Commissioners and that was reported in the public media sometime ago, it emerged that some people who owed the Department money had very significant amounts of money in their bank accounts. I recall one case in which a person had approximately €400,000 in a bank account. It is very difficult to say to people who rely on a retirement pension, as many people do, that a person who has very large bank deposits should not repay a sum of money that he or she owes. The officials in the Department are extremely careful to take account of personal circumstances. The 15% can be recovered only from the personal payment; it does not relate to any other payments made to individuals or in respect of children in the person's household. It is all done very carefully and effectively, but the end result is that the recovery of moneys has been significantly enhanced. It also happens in a more timely way, and the beneficiaries of this are people who rely on a social welfare income but also general taxpayers who have to pay taxes and PRSI to fund what is a very important social welfare system in this country. I suggest that Members would not want to see the social contract undermined by a belief that moneys cannot be recovered from a tiny number of people who have abused the system, to the detriment of the people who support the system and who pay taxes.