Super, administration most efficient

Press, 12 September 1986, Page 27

Super, administration most efficient

Wellington reporter National superannuation is the most efficiently administered of Social Welfare benefits. The department’s annual report shows a much higher quality control rating on the payment of superannuation than the three other large benefits. The "loss” on superannuation, or the level of overpayment of the benefit, in the year to March 31, 1986, was 0.28 c in the dollar. In contrast, the “loss” on unemployment benefit payouts was 4.44 c in the dollar. The department measures the cost involved in overpayment of the benefits, either through defective administration or misrepresentation by recipients, by

questioning random samples of beneficiaries each month. In the five years the quality control programme has run, the loss on unemployment benefit has been cut 30 per cent. In the latest year, the overpayment of the domestic purposes benefit was 1.52 c in the dollar, and that on Family Care was 2.50 c. It was the first year of the benefit and it proved many times more inefficient than family benefit, reflecting its more complex eligibility criteria. The loss on superannuation has been cut from 0.31 c in the dollar in 198182. The report shows that the gross cost of superannuation rose 21.7 per cent in the latest year, to be $3.34 billion. In the year to March 31, 1985,

the total payout represented 6.7 per cent of New Zealand’s gross domestic product, down from a peak of 7.5 per cent two years previously but up from 6.5 per cent in 1981-82. The number receiving national superannuation at March 31, 1986, was 465,079, a 25 per cent increase on the year of its introduction, 1977. Of all recipients last year, more than half were aged 60 to 69, and only 5 per cent were aged more than 85. Of the total, 24.4 per cent were affected by the tax surcharge. Domestic purposes payouts, at $603.8 million, were about a fifth of the total paid in superannuation, while the latter was 11 times the amount paid in unemployment benefits ($290.4 million).