Written answers

Wednesday, 11 November 2009

Department of Social and Family Affairs

Social Welfare Fraud

9:00 am

Photo of Joe McHughJoe McHugh (Donegal North East, Fine Gael)
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Question 78: To ask the Minister for Social and Family Affairs her views on the Comptroller and Auditor General's report that stricter controls and more accountability are needed to eliminate high levels of fraud and errors in the welfare system; and if she will make a statement on the matter. [40644/09]

Photo of Bernard AllenBernard Allen (Cork North Central, Fine Gael)
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Question 80: To ask the Minister for Social and Family Affairs the control measures she will introduce to assist in reducing fraud; and if she will make a statement on the matter. [40596/09]

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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Question 89: To ask the Minister for Social and Family Affairs the savings made by her Department as a result of fraud detection; and if she will make a statement on the matter. [40617/09]

Photo of John O'MahonyJohn O'Mahony (Mayo, Fine Gael)
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Question 102: To ask the Minister for Social and Family Affairs if she is satisfied that she will reach the savings target she has set for 2009 by the end of the year; and if she will make a statement on the matter. [40652/09]

Photo of Pádraic McCormackPádraic McCormack (Galway West, Fine Gael)
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Question 105: To ask the Minister for Social and Family Affairs the position regarding fraud control measures put in place by her Department; and if she will make a statement on the matter. [40639/09]

Photo of Mary HanafinMary Hanafin (Dún Laoghaire, Fianna Fail)
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I propose to take Questions Nos. 78, 80, 89, 102 and 105 together.

The prevention of fraud and abuse of the social welfare system is an integral part of the day-to-day work of the Department. A key objective of the Department's control strategy is to ensure that the right person is paid the right amount of money at the right time.

The Department processes in excess of 2 million claims each year and it makes payments to over one million people every week. The vast majority of people are receiving the entitlement due to them.

Where overpayments occur the Department seeks to recover the overpayments and in cases of serious fraud, the Department will use all legal avenues open to it to recover the money defrauded and seek redress.

A four-pronged control strategy has been adopted by the Department, namely prevention of fraud and error at the initial claim stage, early detection through effective review of claims in payment, measures to deter fraud and the pursuit and recovery of overpayments.

Key elements of the Department's control strategy include systematic risk analysis, surveys of the levels of fraud and error within schemes, scheme specific review policies, data matching initiatives with both external and internal parties and investigation of anonymous reports. These control tools ensure that review activity is targeted in the most effective manner and ensure that where overpayments arise they are detected as early as possible.

Over 620 staff at local, regional and national level are engaged on a full or part-time basis on work related to the control of fraud and abuse of the social welfare system. About half of these work full time on control work, while the other half are responsible for routine investigations under the various schemes and for following up suspected cases of fraud where these are discovered.

The rapidly changing economic environment with large increases in the levels of unemployed poses challenges for the prevention and effective management of fraud and control.

The Department's response to these challenges has been to introduce new measures to target control activity at high risk categories of claimants.

For example:

Control activity is being focused on the prevention of fraud and error at claim application stage.

The Special Investigation Unit is undertaking more regular interviews of jobseeker recipients, particularly those with high risk ratings.

As a preventative measure the option to receive payments by Electronic Fund Transfer (EFT) was removed for new claimants for jobseeker payments. They must attend in person at the post office each week thus confirming their continued residency in the country. Their claim is automatically suspended where two consecutive payments are not collected.

Border regions have put an increased emphasis on controls on claims from applicants with a previous address in Northern Ireland.

One Parent Family Payment recipients with earnings are targeted for on-going review.

The frequency of issue of mail shots to validate continued entitlement to Child Benefit has been increased to 3 monthly intervals for EU worker customers and resident non-Irish national customers.

The number of anonymous reports from members of the public has increased dramatically in the past year, with over 4,600 reports made at end September 2009 compared to approximately 1000 reports made in 2008. Each report is followed-up.

The Department is moving to a risk-based system which will achieve better value for money by focusing scarce resources on the most appropriate cases. For example for Disability Allowance, a new control review policy for the scheme was introduced in January 2009 which involves assigning and recording a risk rating at the award and review stage of all claims in the medical and means categories. A similar risk based control review policy is being piloted for Carer's Allowance with the same approach planned for Invalidity Pension.

New data matches have been initiated to effectively target reviews and generate savings. In 2009 data was received from The Personal Injuries Assessment Board, The Commission for Taxi Regulation, The Criminal Injuries Compensation Tribunal and Local Authorities. In addition agreement has recently been reached with The Revenue Commissioners for data on capital assets.

In relation to savings, at the end of September 2009, the Department recorded control savings of nearly €355m, which is 78% of the year to date target of €453m. The annual control target for 2009 is €616.5m. It is difficult to project what the control savings for 2009 will be at this point but it is unlikely that the Department will reach the control savings target of €616.5m.

It must be noted that control activity is currently being focused on prevention of fraud and error at claim application stage. Savings made from the detection of bogus claims at application stage cannot be estimated as the claim will not go into payment. However, this is the most cost effective mechanism of reducing losses through fraud and error in social welfare schemes.

The significant increase in the live register has impacted on the Department's capacity to review claims. The increase has put pressure on staffing resources and particularly on social welfare inspectors who are responsible both for carrying out means-tests on initial applicants and conducting anti-fraud inspections. Additional staff have been assigned to front line work, including an increased number of inspectors.

This Department works closely with Department of Social Development in Northern Ireland and The Department of Work and Pensions in the United Kingdom. Cases are checked to ensure that claims are not in payment in the Republic of Ireland while also claiming in another jurisdiction.

The Comptroller and Auditor General's report made observations regarding stricter controls and more accountability. Since the introduction of the 2003 Strategy, Control Division has taken a strategic approach to the development of control policy. It has pro-actively supported managers to manage their responsibilities with regard to the control of schemes. Resources available for control activity have focused more effectively on those schemes and parts of schemes that pose the highest risk of fraud and abuse.

As part of the implementation of the Strategy, a number of new policy initiatives were implemented specifically the fraud and error survey programme and fraud risk assessment of schemes. These initiatives have facilitated a more focussed and targeted approach to control activity. A key strength in the successful implementation of these policies has been the integrated nature of the control function within the Department. This is in contrast with other jurisdictions where there is a disconnect between scheme administration and scheme control and managers responsible only for scheme administration feel that they have no function in relation to scheme control.

The Department is committed to ensuring that social welfare payments are available to those who are entitled to them. In this regard the control programme of my Department is carefully monitored and the various measures are continuously refined to ensure that they remain effective.

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