Fraud check planned for beneficiaries

Press, 8 May 1980, Page 3

Fraud check planned for beneficiaries

Random checks on beneficiaries throughout New : Zealand are being considered by the Social Welfare Department in an effort to control abuse of the system. The assistant director general of benefits and pensions (Mr J. W. Grant) told a news media seminar m Wellington that last year fraud cost the department about SI million. The proposed scheme was aimed at controlling the number of beneficiaries who abused the system by claiming benefits when they were no longer entitled to. them. The checks would include those claiming unemployment and domestic purposes benefits. Checks would also be made on Social Welfare Department staff to minimise in-office error, although Mr Grant said that he thought the rate of error was less than 3 per cent. The department would not call on domestic purposes beneficiaries early in the morning to check on their eligibility, nor would the department hire a team of “in-

vestigative snoopers,’’ he said. “We must be open about this — people must know that the scheme is being introduced.” The idea of random checks was not new, as it had been used by the department many years ago. The proposed scheme had been drawn up after the Minister of Social Welfare (Mr Gair) had asked the department to examine ways of tightening up payments of the domestic purposes benefits.

Of the $1 million written off by the department last year, $750,000 was in lost or stolen orders. The department had reduced these losses a lot in the last year by introducing the direct payment scheme. Mt Grant said he estimate ed a. loss of $500,000 this financial year, but the department had no way of estimating the financial loss through undetected fraud. The Opposition’s shadow Minister of Social Welfare, Mrs Whetu Tirikatene-Sulli-van, described the proposed random checks as an erosion of New Zealand’s justice system. It was yet another small step towards a police State.

The Labour Party held no brief for cheats, whether in sophisticated business or among social welfare beneficiaries. As with Pacific Island over-stayers, the party totally opposed systematic random checks, she said. Any random checks on beneficiaries was an attack on all of them, the vast majority of' whom qualified in every way.