High rate of error in benefit payments

Press, 23 September 1988, Page 6

High rate of error in benefit payments

PA Wellington The Social Welfare Department’s first quality control study of sickness benefits has found it paid the wrong amount on about 38 per cent of benefits. Although the percentage of errors was high, it had only affected total sickness benefit payments, of $159.85 million in 198788, 5 per cent, the department said in its annual report. There was no indication whether that 5 per cent, worth $7.9 million, was an overpayment or underpayment. “Nevertheless, the de-

partment has accepted that current rates of error are unacceptably high and has taken urgent action to identify the reasons for error and introduce remedial action,” the report to Parliament said. Estimates for unemployment benefits showed the wrong amount was paid in 39 per cent of cases. Those errors affected benefit spending 6 per cent or $4O million of the total spending of $672 million. Office errors accounted for less than 2 per cent, or $13.44 million of the effect on spending. Again, the department

was taking “urgent action” to prevent such errors. There were errors in 28 per cent of domestic purposes benefit payments but they affected total benefit spending less than 2 per cent. Less than 1 per cent were attributable to office causes. Total spending for the domestic purposes benefit and emergency maintenance allowances in 198788 was $BOB million. By comparison, only 8 per cent of national superannuation benefits had monetary errors in 1987-88, steady with the previous year. Total payments were $3986 million.