Ombudsman says welfare files did not explain repayment demands

The Department of Social Protection pursued people for thousands of euro in overpayments despite having little or no documentation to justify the demand for repayment, a report by the Ombudsman has found.

In one instance, a man was asked to pay back €17,000, but when he sought his file under Freedom of Information legislation, he was told it had been "purged". Later the department told Ombudsman Peter Tyndall that "it could not locate the file and it could not provide evidence to support a decision that an overpayment exists".

A random sample of files reviewed by the Ombudsman’s office showed that many lacked clear explanations for a decision, or enough detail around calculation of the overpayment raised, or were missing correspondence relevant to the decision.

Of the cases examined, almost half “were identified as having concerns which cast doubt on the department’s justification in recovering the overpayments raised against the claimants”.

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The department has far-reaching powers to recover overpaid social welfare allowances, which allow it to pursue cases even after the statute of limitations which would prevent it from lodging a court case has expired. It can also attach payment orders to a person’s social welfare payment, including their State pension.

The Ombudsman said that on some occasions an individual who may have been unaware of an overpayment demand, only realised it was outstanding when they began to draw down their State pension.

Given the strength of the department’s powers, Mr Tyndall argued that it had a particular obligation to ensure principles of fairness and natural justice were observed.

The department was criticised over its failure to routinely inform a person who was the subject of a repayment order that it existed, leading many people to wrongly assume that overpayments which they had disputed years or decades ago had been written off by the department.

Many of the cases reviewed also did not contain evidence that claimants were informed of their right of appeal when they were notified of a revised decision in their case. Individual cases reviewed “gave rise to concerns that the department was not always using its powers in an appropriate manner”, and that on occasion “there was a failure by individual decision-makers to adhere to the guidance in a consistent and proper manner”.

“In most case files examined there was an absence of key supporting documentation relating to the recovery of overpayments. The examination also raised worrying questions about the propriety of pursuing overpayments in several of the cases selected.”

Mr Tyndall told The Irish Times he first became concerned about the issue in 2015, when his office noticed that a much higher level of complaints were being upheld in relation to overpayments issues than was the case across the entire body of complaints relating to the department. Around 50 per cent of complaints were being upheld at the time, he said.

Mr Tyndall said the pursuit of overpayments was ramped up during the recession when “people were under pressure to bring in any income that was due to the State”.

He said the department should have provided more clear guidelines to staff who were asked to pursue cases. “When you switch to a more vigorous approach you need to be providing guidelines and training for staff.”

He said in some instances the department was looking to reclaim sums that dated back to the 1990s or even earlier, which were later lost.

Despite the findings, Mr Tyndall stressed that the department had been co-operative with the Ombudsman’s office, and had undertaken to put in place reforms aimed at tackling the shortcomings identified, which he said was laudable.

“The Department has responded well to our request for change; most concerns relate to issues raised in the past.”

CASE STUDY 1

The department sought a payment of €17,000 from a man dating back to the period 1998 to 2000. He had received no notification of the outstanding overpayment from the department in the intervening period, and was only notified when he applied for an invalidity pension.

When he sought his file under Freedom of Information legislation, he was told it had been “purged”. The department later told the Ombudsman’s office that it could not find the file and had no evidence to support a decision that an overpayment existed. It agreed to write off the overpayment.

CASE STUDY 2

A man received a letter from the department in 2011 arguing that he owed €10,000 in overpayments in respect of Job Seeker’s Allowance. He said that he had supplied the department with all information it sought from him, including pay slips relating to his wife’s maternity leave, but that it had lost the information on at least three occasions.

He queried his payment as it seemed too high, but the department assured him it was correct. The department also failed to respond to phone calls, emails and other communications from the man on multiple occasions. Following the complaint to the Ombudsman, the department cancelled the overpayment and refunded the amount it had already recovered.