Beneficiaries get overpaid

Press, 19 December 1988, Page 8

Beneficiaries get overpaid

PA Wellington About 1900 sickness and unemployment beneficiaries have been overpaid by a total of more than $197,000 in a preChristmas blunder, the “Dominion Sunday Times” reported yesterday. The beneficiaries, throughout New Zealand, received an extra $lO4 last week over and above their normal benefit entitlements.

The error came just days after the Minister of Social Welfare, Dr Cullen, announced Cabinet approval for a new $72.7 million computer package to replape the Social Welfare Department’s existing

system. The new system is expected to save the department an estimated $22.4 million a year in benefit errors.

Ms Maria McKinley, the assistant director-general of finance and resource management for the department, said a report was on its way to Dr Cullen outlining the cause of the error and action to recover the money.

It was just an unfortunate mistake in which a bug somehow got into the computer programme, she said. The 1900 beneficiaries affected had not been entered on the normal computer system and were receiving temporary advances. m

“Extensive testing was carried out on the programme but the bug was not picked up till after the system was generated.” Ms McKinley said the beneficiaries had not yet been contacted by the department, which had only discovered the error last week.

She was unaware of any attempts by beneficiaries to return the overpayments but suggested they contact their district department offices. A confidential departmental memorandum obtained by the "Dominion Sunday Times” outlining the mistake suggests similar errors may have occurred previously within the department.

The memorandum, headlined, “We have had another muck-up,” read: “Due to an error in the direct daily credit programme, we have very kindly added $lO4 to every generated payment on the weekly base that was keyed in on Thursday, December 8, and paid yesterday.

“In this instance we are trying to get a ruling from head office on what action to take with the overpayments. “There are 1990 cases involved throughout the country. If offered, any refunds should of course be accepted.” Ms McKinlay said the memorandum was unfortunately worded and did

not suggest overpayments on such a grand scale were common practice. "The error is certainly the worst we have had for at least 12 months and not one we expected to occur again.”

The memorandum was a reflection of the frustration of staff who had to work on outdated and unreliable equipment, she said. -

A spokeswoman from Dr Cullen’s office said he had been told of the incident, which confirmed the need for new computer software.

The new $72.7 million system would pay for itself in reduced benefit error over the years, he said.