The Department of Social Security (DSS) does not investigate potentially suspect income declarations by parents who receive a children’s allowance, an audit has found.
Testing during the audit revealed that the highest possible allowance was at times given to beneficiaries, even though their registered occupation indicated that their income should have made them ineligible for it.
Although according to Jobsplus records such individuals were employed or self-employed in the building construction, renovation or carpentry industry, they still declared “unreasonably low income”, the Auditor General said.
The Auditor General recommended that the DSS consider proposing the investigation of particular income declarations by Inland Revenue, where appropriate.
Besides ensuring that the correct children’s allowance is awarded to eligible individuals, this will also assist in the proper collection of income tax, the Auditor General said.
The department, however, argued that it is not the competent authority to investigate income declarations.
Overpaid amounts are expected to be repaid within an agreed time period- Auditor General
It said when low-income declarations are noted repeatedly, the department draws the attention of the head of household and continues awarding the lowest benefit rate until the necessary explanation is received.
The audit said the government had also made “insufficient efforts” to recoup overpayments made to parents.
According to the report, the aggregate figure of overpayments stood at €2.4 million as of January 2023.
Auditor General Charles Deguara said the department should ensure that “no effort is spared” to recover the pending dues quickly.
The report recommended that the department redraft its overpayment notification letter to parents, to include a specific request for the benefit claimant to repay the relevant dues.
“Whilst this will not necessarily make claimants pay instantly, it will at least make them aware that overpaid amounts are expected to be repaid within an agreed time period,” the Auditor General said.
The department agreed to the recommendation, saying besides notifying parents about a revision in the benefit rate, beneficiaries will be asked to settle overpayments and will be directed to enter “reasonable repayment agreement(s)”.