Free travel payment based on 1973 survey, committee hears

Social Protection says €61m to CIE for scheme based on old passenger estimate

Public Accounts Committee chairman John McGuinness was shocked that free travel payments were based on a 1973 usage  survey. Photograph : Matt Kavanagh / The Irish Times

Public Accounts Committee chairman John McGuinness was shocked that free travel payments were based on a 1973 usage survey. Photograph : Matt Kavanagh / The Irish Times

Thu, Mar 14, 2013, 17:03

Annual payments of some € 61m to CIÉ for the State’s free travel scheme is based on a passenger estimate from 1973, the secretary general of the Department of Social Protection said today.

Niamh O’Donoghue was speaking at the examination of her department’s accounts by the Public Accounts Committee.

Committee chairman John McGuinness expressed shock at learning of the 30 year lag in data during the meeting.

Ms O’Donoghue told the committee that the department had “absolute figures” on eligibility, in that 1.1m people that qualify for the scheme.

Mr McGuinness asked if she was satisfied it was value for money.

The benefits available for people on the free travel and the number of beneficiaries had increased at no cost, she said. CIÉ also believed they were being underpaid, she added.

“I am shocked you continue pay the company money and do not know the numbers” that use it, Mr McGuinness said.

The public services card being introduced by the Department would allow usage to be monitored, she said.

Deputies also raised concern at the level of fraud and recovery of welfare overpayments .

The Department is “investigating the possibly of using attachment orders” for recovering overpayments and was “quite confident of making progress,” Ms O’Donoghue said.

This would apply in “off book” cases where debts cannot be taken from social welfare payments as a person are no longer receiving them.

The Department has to write off € 5m in unrepaid payments per year, the meeting heard.

Recoveries of overpayments in 2011 were 13 per cent of the total debt , while almost half overpayment debt was greater than 5 years old.

Fine Gael TD for Waterford John Deasy raised concern about whether there were enough deterrents to stop people committing welfare fraud. The 2-3 per cent fraud prosecution rate in the State was much lower than some 30 per cent in Scotland, he said.

The role of the Department was to maintain a balanced view and it was extremely mindful of the control of fraud, Ms O’Donoghue said.

It focused on the more serious fraud cases and a judgement had to be made between resources to bring a prosecution and the likely outcome, she said.

The potential exists to use Revenue’s property tax information for assessment of welfare payments , she said.

The Department would also be making deductions from payments of the property tax on instruction from Revenue.

However such a deduction could not reduce payments below a supplementary allowance level, she said. Where overpayments were due to the department they would recoup these before Revenue got its payment, she said.