Vol. 691 No. 1
100 Deputy Olwyn Enright asked the Minister for Social and Family Affairs if she is satisfied with the Government’s effort to assist people experiencing financial difficulties and struggling to cope with debt problems; and if she will make a statement on the matter. [34863/09]
The Money Advice and Budgeting Service, MABS, is the main Government-funded service that assists people who are overly indebted and need help and advice in coping with debt problems. It is important for people coping with debt difficulties to take early action and approach MABS for help and guidance. This can be the first positive step for people as they address their debt difficulties. The role of money advisers is to help people to assess their financial situation, make budget plans and deal with creditors. MABS is dealing with increasingly complex debt situations in the cases of clients who are presenting with multiple creditors and debts. The 53 independent MABS companies, which have voluntary boards of management, operate local MABS services in 65 locations throughout the country. The MABS national telephone helpline is available from Monday to Friday between 9 a.m. and 8 p.m. The MABS website can be accessed 24 hours a day. In 2008, more than 16,600 new clients approached MABS for assistance with debt difficulties and the telephone helpline dealt with almost 11,000 callers.
In the first nine months of this year, 14,700 new clients were seen by MABS staff and the helpline received more than 18,000 calls. Funding of almost €18 million has been provided to MABS to deliver its services in 2009. An additional 19 staff are being recruited for MABS, which will bring the money advice staff to more than 270 in 65 locations. This will help local services to manage their increased caseloads. The capacity of the locall telephone helpline has been strengthened. The national support company, MABS NDL, has introduced a number of community education initiatives. One initiative involves a money management education programme, which informs people facing redundancy about managing on a reduced income and avoiding getting into debt. All MABS companies operate an appointment system for meeting clients. Clients with urgent difficulties are prioritised for attention and dealt with promptly. Less urgent cases are referred to the telephone helpline and the MABS website.
More than 90% of callers to the helpline find that their money management and budgeting issues can be resolved with the assistance of the helpline adviser. Some 10% of callers are referred to the local MABS for assistance. Other areas of debt are dealt with by community welfare officers, through the rent supplement and mortgage interest supplement schemes, with which we will deal later. MABS is the main State body that deals with people experiencing indebtedness. I am satisfied that it provides a high quality personal service.
Just five of the 19 additional staff are full-time. How many additional full-time positions are there in the Money Advice and Budgeting Service? How many full-time positions do those 19 people hold? While it may be difficult, it is better to act before people get themselves into difficulties. Does the Minister have any plans to be more proactive in trying to assist people before they get into debt? I ask that question because 80% of Irish mortgage holders are on variable or tracker mortgages. It is expected that the European Central Bank will increase interest rates next year, or sometime after that. The number of people unable to pay their mortgages will increase at that point. We need to try to resolve that situation and assist those people at this point, rather than waiting for them to get into difficulties down the road. Does the Minister have any plans to regulate commercial debt advisers? She will have seen reports over recent weeks about companies that have been set up in this sector. It seems that people saw a vacuum in the market and moved in. Like MABS, I have many concerns about the lack of regulation of this sector. People are having to make significant down-payments to some of these companies. I am aware of cases in which the first month's payment went to the company, rather than being used to pay a utility bill or some other bill. I have concerns about such practices. It would be better to regulate this area now so that we do not have to address greater problems in a year's time.
I understand that 12 full-time posts have been divided up among 19 full-time and part-time workers, although I stand to be corrected. The Deputy suggested that people should be given advice in advance, which can be done in several ways. I recently launched a programme under the Money Advice and Budgeting Service's community education programme, which is very successful at giving information to people at a young age. MABS, in conjunction with the Financial Regulator, has devised a useful document in support of the transition year programme on money management and priorities within money. The MABS programme for working with Travellers will help such people from running into debt. The Deputy specifically asked about mortgages. I understand from the Financial Regulator that when one is selling a financial product, such as a pension or a mortgage, one has to advise people that its value is likely to decrease as well as increase. People have to be given that information.
The banks gave people questionable advice in recent years. People will find themselves in difficulties as a result of reckless lending.
I do not question the Deputy's opinions on what has happened. She is right to mention that people were advised to take out 100% mortgages, for example. The Financial Regulator obliges financial institutions to give certain advice. There has been an increase in the number of debt collection groups, many of which have written to me to offer assistance with our work. I am aware of a serious and unfortunate case in which a number of people received letters, purporting to come from MABS, claiming they could receive support and help. It was frightening and disconcerting for people. Any organisation engaged in financial business is required to adhere to certain guidelines. I will investigate whether the Department of Finance or the Financial Regulator needs to do anything else to regulate the companies mentioned by Deputy Enright.
I urge the Minister to do that immediately. People will encounter difficulties down the line. It is wrong that people's payments for an entire month are going to these companies, rather than towards the repayment of the debts that got them into trouble in the first place. The huge waiting lists for MABS — of up to three months in some areas — are causing people to get into bigger difficulties. Is the Minister satisfied that the 12 full-time posts are sufficient? Can she comment on the Comptroller and Auditor General's report on the number of cases being dealt with by MABS personnel each week? The report seems to contradict my experience, which is based on my conversations with the staff of MABS. I respect the work done by the Comptroller and Auditor General in his report, which is generally fairly correct. I would like to hear the Minister's views on these matters.
There are two issues. At a time when there is an embargo on recruitment, we were lucky to secure 12 positions. We have divided them among the MABS offices with the greatest increase in demand. I was also a little taken aback by the comments of the Comptroller and Auditor General on the number of cases being dealt with by MABS. I have witnessed the work that is being done. The Comptroller and Auditor General did not take account of the huge increase in the number of people who are dealt with on the telephone. Some 18,000 people, the vast majority of whom had straightforward issues that could be dealt with over the telephone, have called MABS so far this year. More complex cases need to be dealt with differently. The staff of MABS on the ground are genuinely trying to prioritise those with the greatest need. If someone is in a particularly difficult situation with priority loans, rather than secondary loans or debts, he or she will be dealt with immediately. MABS also has ongoing money management clients from year to year. I have suggested that there may be a way of putting such people at arm's length, perhaps by meeting them fortnightly rather than weekly, to ensure that the new catchment of people who are coming in can be dealt with.
101 Deputy Róisín Shortall asked the Minister for Social and Family Affairs the reason for the delay in bringing forward a framework for pensions policy. [34913/09]
The Government is aware that wider and longer term pensions issues require a comprehensive and co-ordinated response. Following the conclusion of the successful consultation process last year, we have been considering options to address the challenges facing our pensions system which were raised in the Green Paper process. These issues relate to social welfare pensions, the sustainability of our pension system generally, the adequacy of current provision and other complex issues around regulation, public sector pensions and retirement age.
In the past year, the economic environment has changed considerably and we need to ensure that decisions we make in the pensions area are robust enough to withstand new and unprecedented challenges. The recently published McCarthy report and the report of the commission on taxation both considered pensions issues, albeit from a different perspective. In bringing forward its proposals for pensions provision in the future, the Government will have regard to the issues raised in these reports as well as the options proposed in the Green Paper and the follow-up consultation process.
In the meantime, we have been responding to the immediate difficulties facing employees, particularly those in defined benefit schemes whose companies and pension schemes faced difficult situations as a result of collapse in equity values and the economic situation. The Government has moved quickly to protect people's entitlements through the measures announced last December and the amendments passed in the Social Welfare and Pensions Act 2009. These measures include the establishment of a pensions insolvency payment scheme, a reordering of wind-up priorities, provision for restructuring of pension benefits and stronger regulation with regard to remittance of pension contributions.
It is entirely appropriate that the Government should take the time to arrive at sound decisions about the future of our pension system given the potential of such decisions to significantly impact on this and future generations. Our objective is a system which will deliver an adequate retirement income for all which is at the same time affordable and sustainable for the State and those who sponsor and provide pension schemes.
It is reasonable to say that time is needed to prepare a policy on pensions but we are approaching the second anniversary of the publication of the Green Paper on pensions. Since the beginning of this year, Deputy Enright and I have sought to know when the framework will be produced. During the early months of the year, the Minister repeatedly assured us it would be a matter of weeks but these assurances seemed to die a death. She is quoting from other reports and documents but what is she doing about the matter? She is responsible for pension policy and has had two years in which to draw up a White Paper on pensions. In the meantime, thousands of people are finding their pension provisions are completely inadequate and there is no initiative from the Government. The steps to which she referred are merely scratching the surface. I ask her to tell us the reason for the delay in bringing forward the long-promised pensions framework and the month in which we can expect it to be published.
When I indicated at the beginning of the year that we hoped to publish within weeks, that was the situation which then obtained. However, it would be foolish of us to issue a long-term framework or strategy while ignoring the changes that have taken place in the economy since the publication of the Green Paper. The economic basis for any framework has changed completely in the past two years.
As I noted in my earlier reply, we addressed some of the immediate issues of significance. Equally, any changes recommended in the framework will be of a long-term nature. They will not impact on those who are about to reach retirement age. It is not correct to suggest that people who have now lost their pension rights will be affected by these recommendations. It is important that we set out a long-term framework.
I do not want to mislead the House by stating that the framework will issue in the next few weeks but it remains a priority for us during this term.
In June the Government produced a document which proposed a pension insolvency minimum guarantee scheme. When will we see that scheme?
The former workers of SR Technics and Waterford Crystal are crying out for assistance from the Department of Social and Family Affairs in dealing with the serious pensions issues they are facing. The Minister referred to two schemes, neither of which have been commenced. In the case of Waterford Crystal, it appears no help is available at present. When will she move to provide much needed assistance to the former workers of SR Technics and Waterford Crystal?
The Department of Finance is responsible for drawing up regulations under the pension insolvency payment scheme. Officials from that Department have been working on the scheme over the summer because technical issues have arisen. However, they continue to make progress on it. The fact that regulations are not in place has not impacted on the funds because it is not as if they have not been wound up. The fund managers know the scheme is coming and the funds will be included in the scheme if they qualify. That is the nub of the issue for one of the companies mentioned by the Deputy. The double control provided for in the scheme requires that the company be insolvent and the pension scheme be in deficit. My understanding is that Waterford Crystal meets these requirements but, unfortunately, the SR Technics company does not qualify because it is not insolvent.
Is the Government providing any assistance to the former workers of SR Technics? The Minister indicated when she brought forward the proposals that they would be covered but this no longer appears to be the case.
It was never stated that SR Technics would be included in this scheme. I met representatives of the group and they made good arguments but according to the definition of insolvency in legislation introduced by the Department of Enterprise, Trade and Employment, the company does not qualify. I sympathise with the workers because, as far as they are concerned, the company no longer exists. However, under legal terms and definitions it does not qualify for this scheme.
102 Deputy Olwyn Enright asked the Minister for Social and Family Affairs if she is satisfied that social welfare payments are being processed within an acceptable timeframe; and if she will make a statement on the matter. [34864/09]
Processing times vary across schemes, having regard not only to the volume of applications but also to the requirements of each scheme. For example, a means assessment must be carried out for all social assistance schemes, medical examinations are required for illness related schemes and customers must satisfy the habitual residence conditions. In the case of the insurance based schemes, it may be necessary to ascertain details of foreign insurance records.
In general, average processing times for most schemes administered by the Department are within acceptable levels. For example, in the case of illness benefit, approximately 50,000 medical certificates are received each week and the average processing time is one week; 95% of maternity benefit claims are processed prior to the commencement of maternity leave; the average processing time for domestic state pension contributory claims is seven weeks; and the average processing time for child benefit is four weeks where the entire family resides in Ireland.
The average processing times nationally for jobseekers payments in September were under four weeks for jobseeker's benefit and under eight weeks for jobseeker's allowance. I appreciate that waiting times for the jobseekers payments are too long in some parts of the country and I assure the House that we are doing our best to address this with additional staff and improved procedures for processing claims.
Other schemes where steps are being taken to reduce processing times include the disability allowance and the invalidity pension. Receipt of the disability allowance is subject to a medical assessment, a means test and a habitual residency test. It can take time for each of these criteria to be met. The number of claims has also increased significantly from approximately 17,600 applications in 2006 to 21,000 in 2008. Entitlement to invalidity pension is based on satisfying medical and insurable contribution conditions. However, approximately 90% of applicants for invalidity pension are already in receipt of illness benefit from the Department while awaiting the result of their invalidity applications.
Overall, I appreciate the need to ensure that people can receive financial support from the Department as early as possible and I assure the House that we are doing our best to bring processing times in all schemes down to an acceptable level. In the meantime, it is important to remember that people who have urgent income support needs can apply for the means tested supplementary welfare allowance and greater than 95% of basic such applications are decided on and paid within the week.
I am not satisfied that applications are being processed within an acceptable timeframe. The Minister provided examples of payments which are made on time but I will outline cases where delays have occurred. The biggest issue with which we deal is the jobseekers allowance but I also wish to raise the back-to-education allowance. I do not know Deputy Shortall's experience of this issue but I am aware of a significant number of people who have returned to college on the basis of loans from credit unions or family members because their back-to-education allowance claims have not been processed. What are the timeframes for the back to education allowance and, importantly, what can the Minister do to ensure that people are not borrowing on the expectation that they will get something they may well not get?
On the lone parent allowance application, I know of someone who is waiting for a lone parent allowance application to be approved; I actually received an e-mail about it at 2.38 p.m. The person is waiting for the lone parent allowance application to be approved before the person's back-to-education allowance can even be considered. It is necessary to verify that the person is entitled to the first one before ascertaining if the person is entitled to the second one. That person has gone back to college with a very young child and does not know if the back to education allowance will be granted.
The other question I want to ask relates to the jobseeker's allowance. My party has raised this matter numerous times in this House, but I will give the Minister an example which happens to be in my constituency; in Edenderry the waiting time is 22 weeks. The Minister seemed horrified when she learned that on 11 September last, but I raised the matter in this House at least three times this year. In fact, the first time I raised it the waiting time was 16 weeks and the Minister was going to do something about it then. Whatever was done added another six weeks to the waiting time for the people in Edenderry. I wonder how the Minister will address such situations.
I will take the middle issue first. It is unusual where there is a complicated situation where somebody is not in receipt of a social welfare benefit already and is looking for two payments at the same time. I can understand how——
She looked for one first.
She cannot qualify for the back to education allowance unless they can prove that she qualifies for the lone parent allowance. I can understand why that particular waiting time might be long.
Generally, there is not a long delay on lone parent allowance applications. I do not think I have the figure for the waiting time for that allowance to hand, but I shall——
It is three months.
Sorry, I do have it. Yes, it is 13 weeks for the lone parent allowance application. However, as the Deputy will be aware, there are issues in that regard. It is not merely the case that one must have a child; a person must also be living alone and the income must be assessed. It is the income that takes time to assess.
Some 11,710 applications for back to education allowance have already been approved. This is a valuable increase of 67% this year. There are still approximately 4,000 cases awaiting a decision, a number of which may have come in only recently when people have made late decisions. The Department is working its way through that. I am encouraged by the number of people who have applied for it.
What is the average processing time?
A question on the back to education allowance is coming up.
The Minister can deal with it later then.
The Minister should not anticipate future questions.
I am sorry. What was the Deputy's third question?
It related to Edenderry, as an example of lengthy waiting times. There are plenty of examples — Ballinrobe, Tuam, Boyle. We raised them every time as well and they are not improving either.
A brief final reply.
The Deputy is quite correct about Edenderry. There is a long waiting time but it is now shorter than it was.
It is not.
It is now. The Deputy is correct in stating it was 16 weeks at the beginning of the summer. It then increased to 22 weeks. That is entirely unacceptable.
What is it now?
We stated at the time that additional staff would be put in there. For managerial reasons etc., those staff were only put in at the later end of the summer because staff had to be redeployed from other offices.
I use Edenderry as an example. There are problems, not everywhere but in a significant number of towns, that need to be addressed. I do not want the Minister to deal with Edenderry in isolation.
Okay.
Deal with the general problem.
A very brief final comment from the Minister.
Since we were last here there were three issues outstanding that were going to affect the processing of claims and they were three issues that were outstanding with the union at the time. One of them related to setting up an appointments system. The second related to making decisions speedily, particularly on jobseeker's benefit, and to being able to give people an indication immediately on whether they would qualify. The third related to allowing the branch managers make the decision, which was part of the agreement that was reached last year.
Following our discussions and, indeed, the highlighting of the CPSU issue here, agreement was reached on the first two of those. That is working well and efficiently and has been in the best interests of both the clients and staff. No progress has been made yet on allowing the branch officers make the decisions. That is an outstanding issue which must now go to the Labour Court.
I am afraid we need to move on.
That is the issue that will affect the processing times in the towns of which Deputy Enright spoke. When one looks at the list, delays are occurring where branch offices are taking the claims but do not have the right to make the decisions.
How long will that take? People are waiting.
Ceist Uimhir 103——
Unfortunately, it has gone into the labour relations process.
——in ainm an Teachta Róisín Shortall, le do thoil, a Aire.
103 Deputy Róisín Shortall asked the Minister for Social and Family Affairs if she will respond to the criticisms in the Comptroller and Auditor General’s annual report that significant amounts of money are likely to have been paid out by her Department in excess of entitlement in recent years. [34914/09]
The prevention of fraud and errors in payments is an integral part of the day-to-day work of the Department of Social and Family Affairs. Through initial means testing of applicants, reviews of existing claims and targeted control activity in high risk schemes, we aim to ensure that the right person is paid the right amount of money at the right time.
Where people have been paid more than their entitlement, we seek to recover as much money as possible and have a policy of prosecuting those who have committed serious fraud.
On the Comptroller and Auditor General's report, while the Department of course shares his concern about ensuring that people only get what they are entitled to, we disagree with the methodology underpinning some of the analysis in the report. In particular, we believe that it is not appropriate to suggest that past overpayments should be in line with figures from the fraud and error surveys or that there would be such a similarity between figures for future savings and those for past overpayments.
When fraud or error is found in an individual claim, future savings will arise from the person having his or her payment reduced or stopped. However, it may not be possible for the Department to calculate or collect the value of any past overpayments to the individual concerned.
Often the effective date of a revised decision will be a current date, rather than a retrospective one, in which case no overpayment legally arises. For example, all medical reviews resulting in termination are made from a current date.
In other cases, the ability of the deciding officer to establish when exactly the claimant's entitlement ceased will depend on the circumstances of the individual claim. For example, if a person who has been claiming a jobseeker's payment is found, on review, to have been working and the Department can ascertain the period of that employment, then it should be possible to calculate the value of the overpayment involved. However, if a lone parent is caught cohabiting, the person's payment may be stopped, which would result in future savings, but it is difficult to ascertain when the cohabitation started and thereby compute the value of any past overpayment. Similarly, when a payment is terminated because the claimant has moved address and therefore failed to respond to letters sent to him or her, the deciding officer will not have the evidence to make a retrospective decision resulting in a recorded overpayment.
The Comptroller and Auditor General's analysis should be read with this caveat in mind. None the less, I assure the Deputy that both preventing and recovering overpayments is a major priority for the Department and that we are determined to ensure that every euro of taxpayers' money is spent appropriately. To that end, we are not only doing our best to prevent payment errors at the initial application stage, but also targeting high risk schemes for frequent control activity.
The bottom line is that the Office of the Comptroller and Auditor General, which is a most respected office, has found that significant amounts of money have been overpaid by the Department and a small proportion of that has been detected. By any standards, that is a fairly poor performance by the Department. For example, in one of the schemes that has the highest fraud and overpayment rate, the one parent family payment, surveys suggest that in 2007, €67 million was overpaid yet the Department detected only €5 million of that. That cannot be a good performance. There is a concern that the Minister is not targeting those schemes most prone to fraud. Would the Minister agree, given the vast amounts of money involved and given the pressures on the Department's budget, that it makes sense to bring a much sharper focus to the area of overpayment and fraud, and for that reason to have far more frequent fraud and error surveys in which she would target those schemes most prone to fraud because she does not seem to be taking that approach?
In fact, the Department is now working on the basis of not only fraud and error surveys but, as a result of those, of identifying the high-risk categories, and at the time of application even noting which are the ones that need to be constantly reviewed. For example, the Department is aware that within child benefit there are certain sectors that must be followed up frequently. In the case of the lone parent allowance, cohabitation is a problem but problems also arise where those lone parents are working — this is where they are more likely to exceed the qualification criteria for the particular scheme. Equally, with some areas of disability there are some who will undoubtedly be permanently on the payment and there are others who need to be constantly reviewed. The Department does do that, and has become expert at identifying high-risk groups.
The Deputy mentioned in particular the example of the lone parent. It is worth reiterating that if overpayments have been made to a cohabiting parent, and the parent says the cohabitation only started last week, there is no evidence that would show that it has in fact been going on for two or three years and allow the Department to claim overpayment for that period. However, the Comptroller and Auditor General has said that is where we should be able to make savings. If a pensioner dies, in contrast, the Department can check exactly when that happened — we have a system of cross-references now anyway — and know when the overpayment started, so it can claim the money back. Thus, there is variation among the different schemes.
If any amount of money is given incorrectly, every effort should be made to try to retrieve it for the State. However, it was established that overpayments amounted to an equivalent of 0.32% of the total social welfare expenditure. This must be viewed in the context of the number of payments being made every week, which is 1.25 million. I accept it is important to identify high-risk groups, and that is what we do. It is important to conduct regular reviews on as many recipients as possible and retrieve money that has been overpaid.
We can all quote figures. The Comptroller and Auditor General found that of the five schemes surveyed, overpayments were recorded in a quarter of cases. That is a high number.
The Minister diverted staff away from fraud and into processing, which was perhaps justified on a short-term basis. Is there now a full complement of staff dealing with fraud? Does the Minister accept the conclusion of the Comptroller and Auditor General that the Department was far overstating the amount of savings in terms of money actually retrieved?
The Comptroller and Auditor General is using a fraud and error survey to determine that overpayments were made, although the survey was done to identify the high-risk groups in order to make savings in the future. I am not saying no overpayments were made; of course they were, and we always try to get them back. However, the Comptroller and Auditor General was using a survey that was designed for a completely different purpose to extrapolate figures. It is not true that he said overpayments were made in a quarter of cases. That only referred to a particular table in the report, which does not show the proportion of overpayments in all welfare claims reviewed.
It showed that €255 million euro was saved on those schemes.
There are currently 398 inspector posts occupied in the Department, and an additional 40 inspector posts were approved this year, of which 21 have already been filled. The remaining 19 will be assigned over the coming weeks.
104 Deputy Olwyn Enright asked the Minister for Social and Family Affairs the amount of money saved in her Department through fraud prevention measures to date in 2009; and if she will make a statement on the matter. [34865/09]
The amount of money recorded as control savings by the Department by the end of August 2009 was €312 million, which represented an increase of €5.5 million on the same period last year. It should be noted the Department only records as control savings moneys which are saved as a result of reviews of existing claims. However, particular focus is currently being placed on prevention of fraud and error at the claim application stage. This is the most cost-effective mechanism of reducing losses through fraud and error in social welfare schemes, but savings achieved in this way are not included in the published figures for control savings.
The Department has introduced a number of new measures to target control activity at high risk categories of claimants. For example, the special investigation unit is undertaking more regular interviews of high-risk recipients of jobseeker's payments, and those in the Border regions have put an increased emphasis on control of claims from applicants with a previous address in Northern Ireland. In addition, the option to receive payments by electronic fund transfer has been removed for new claimants for jobseeker's payments, who must now 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.
One-parent family payment recipients with earnings are being targeted for ongoing review, as this scheme has been identified as high risk in the Department's fraud and error surveys. We have also stepped up measures to prevent people fraudulently claiming child benefit while no longer living in Ireland. To that end, the frequency of mail shots to validate continued entitlement to child benefit has been increased to three months for EU workers and resident non-Irish national customers. New data matches with other public bodies have also been initiated to effectively target reviews and generate savings.
Overall, the Department is moving to a risk-based system of claim review, which it is hoped will achieve better value for money by focusing scarce resources on the most appropriate cases. A new control review policy for the disability allowance 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 pensions.
It is worth pointing out that the number of anonymous reports from members of the public has increased dramatically in the past year, with more than 4,600 reports made at the end of September 2009 compared to approximately 1,000 in 2008. Each report is followed up. I am determined to ensure that abuse of the social welfare system is prevented and is dealt with effectively when detected. In this regard, the control programme of the Department is carefully monitored and the various measures are continually refined to ensure they remain effective.
I am interested in the Minister's last point about anonymous reports because it was stated at a meeting of the Joint Committee on Social and Family Affairs — I do not know whether it was the Minister herself or an official who said it — that despite the large number of anonymous reports, when they are actually investigated the percentage that turn out to be correct is quite small. I do not know why the Minister threw that in at the end of her reply.
The Minister had a target of more than €600 million in savings in this area for this year. Will she meet this by the end of the year, bearing in mind that savings were at €256 million up to the beginning of September? How will she make up the difference?
An example from the report of the Comptroller and Auditor General was that of welfare officers in County Longford, where the number of checks on whether claimants were genuinely seeking work was reduced by three quarters in the middle of last year, and checks ceased altogether by December of last year. That is an example of one office.
I am amazed by stories of new claimants who have not previously been part of the social welfare system going into social welfare offices, in places where they are definitely not known, and not being asked for any form of identification. Many people have said this to me. They have a card but there is no photograph on the card. What is the Minister's response to this? There is a basic level at which every single member of staff who deals with the public can contribute to preventing fraud, rather than just the specialists.
It was worth mentioning in my reply that people are making reports of possible fraud to the Department because it shows the value people are placing on money. Even if many of those who are the subjects of such reports are not fraudulently claiming, the State saves money from the ones who are, so it is still valuable. What people generally do not realise is that there can be quite a high disregard of earnings in some schemes; thus, a lone parent can earn up to €146 per week and still claim the full allowance, but the person complaining may not realise this.
With regard to the target, we had achieved €312 million in savings through fraud prevention measures by the end of August. It is difficult to say what our control savings will be by the end of the year, but the target is high, at €616.5 million. To be honest, I cannot see us reaching that target. The number of reviews has gone up, but the savings from those reviews have not been as great as expected. We have saved more on child benefit, carer's allowance, family income supplement and illness benefit than we had expected, but we have not quite reached the target for unemployment benefits. Perhaps people are not able to get work. In addition, it has been indicated to me that people are now working from within their own homes. One can be a professional person working on a computer while claiming benefits, but an inspector has no right to go into one's home and check, although he or she could go into a building site, for example.
I am anxious to progress with the PPS card, about which I am currently in negotiation with the Department of Finance, because it would be a wise way to cut expenditure. The new PPS card will have detail in it which is personal to the recipient.
How many spot checks are being carried out at this point? We are all hearing about businesses that cannot compete in the private sector because when they give quotes they are competing against people who are on social welfare.
Why did the Minister set a target of €616.5 million given the smaller target set last year was not reached and what advice did she receive in setting that target? Does the Minister have a breakdown of what it is she hopes to achieve in terms of savings from fraud versus error, namely, people who are collecting benefits to which they are not entitled versus mistakes made within the Department?
All of that to which the Deputy refers comes in under the heading of control. We have an amount we expect to achieve in respect of each of the different schemes.
The Minister must have a breakdown of what constitutes fraud as compared with error.
Please allow the Minister to respond with interruption.
It is only when one identifies a case that one can determine what is fraud and what is error.
Does the Minister not break down the information?
We have identified how many reviews we will make within each scheme and how much we hope to gain from those reviews. We have over-achieved in respect of the number of reviews in some areas and have under-achieved in terms of the amount of money saved. As I stated earlier, we recouped more than we expected in respect of carers and less than we thought under other schemes. The number of reviews has increased. Spot-checks are being carried out across all the schemes.
There is a large black economy of people who are working and claiming benefits. Not alone are there people working and claiming social welfare, there are people who are working, not claiming social welfare but are demanding cash payment for work done. Many people are willing to pay them cash. People resent that their incomes have been reduced, they have had to pay levies and so on and they want to obtain better value for money. However, in paying cash to a tradesman or person providing a service, they are denying to the State the taxation in that regard, which money could be reinvested in the economy.
How will the Minister address the problem?
