The amount of debt owed to the Department of Social Protection due to overpaid benefits is likely to top €500m this year — and it has admitted it may have to write-off or cancel tens of millions of historic debt.
The huge debt is owing to the department from people overpaid benefits and the figure has risen by more than €60m in just two years.
The department’s most recent annual report under its Compliance and Anti-Fraud Strategy shows that as of the end of last December, customer debt owed to the department was valued at €482.5m, involving 174,000 people. In the 2015 annual report, the debt level stood at approximately €437m, while in 2014, it stood approximately €421m.
The report, published on the department’s website and signed off on last month by Taoiseach Leo Varadkar when he was still social protection minister, states: “The department holds a significant stock of overpayments.”
It also states that “a third of the value of all overpayments outstanding is more than seven years old.”
Latest figures provided by the department show that as of the end of last April, the amount of debt owed to it had climbed to €489m. Of that, the largest chunk is that dating from 2011 and before — €185.7m.
The department said that a range of measures have been put in place in recent years to increase the amount of money it has recouped, adding that the rate of debt recovery had increased from €51.5m in 2011 to more than €80m in each of the past three years. However, long-term debts may have to be written off.
“A comprehensive review of older debt [pre-2011] is currently being undertaken with a view to considering which elements of it could/should be cancelled or written-off,” a department spokesperson said. “This work is on-going.”
The fraud report shows that overall, some €110m was overpaid by the department last year, €41m of which was due to customer fraud, €46.7m attributed to customer error, €20m relating to customer estates, and €2.3m paid out due to departmental error.
Of the €41m overpaid by the department due to fraud, over half of that figure was attributed to recipients’ means/income/earnings not being fully disclosed in 1,695 cases — working out at an average overpayment of €12,389 each. Another €5.5m was overpaid in 7,707 cases in which people were claiming unemployment benefit when working, while the remaining cases involved issues such as the claimant being in employment or training (3,802 cases), cohabiting (166 cases), or impersonation (40 cases).
According to the report, by the end of last year, €30.8m, or 28% of the total €110m overpaid in 2016, had been recovered in full, with repayments being made on another €27.9m. It said another €37.2m was “pending recovery”.
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