Lack of checks on unprecedented Covid-19 spending criticised

The State’s spending watchdog has criticised a lack of checks on billions of euro worth of spending by the Government during the Covid-19 pandemic, which likely resulted in thousands of irregular payments.

A review of a sample of pandemic unemployment payment (PUP) claims paid out found that in nearly one in 10 cases the recipient was not eligible , the Comptroller and Auditor General (C&AG) has said.

The C&AG found that in nearly half of the cases where people were not eligible to claim the PUP, they had been receiving the payment while still working.

In a quarter of cases, there was no evidence the PUP claimant had been working prior to the pandemic, and in the remainder, the claimant appeared to have returned to work.

The spending report said the sample of claims reviewed found more than 9 per cent “were not eligible for the PUP payment received on the date tested”.

The auditor said that the level of irregular payments made to people under the payment was “likely to have been material”.

Overall, almost €5 billion was paid out under the payment scheme last year, which was introduced in the early weeks of the pandemic to support people who lost their jobs due to Covid-19, on a rate of €350 a week.

The Department of Social Protection said the “emergency” nature of the massive social welfare scheme meant the risk of overpayments “would be higher than normal”.

‘Act honourably’

Officials said while they anticipated some would seek to take advantage of the scheme, they believed most people would “act honourably and honestly”.

The audit report said after the initial surge in applications, “there were opportunities to review eligibility for payments as the scheme progressed”.

The C&AG said officials when processing claims largely relied on people’s own declarations that they had lost their job due to Covid-19 and that they resided in the State .

The report was critical of the fact the department “did not attempt to verify” criteria which required people on the payment to be genuinely seeking work.

The C&AG also found the Department of Enterprise, Trade and Employment did not check whether small and medium businesses were eligible for restart grants towards the costs of reopening during the pandemic before paying out €633 million.

Eligibility was based on whether a business lost 25 per cent or more in turnover, intended to retain staff under the temporary wage support scheme and was committed to remaining open, but this was not verified prior to payment, the watchdog found.

A large number of businesses were likely to qualify but there was no assurance that they all met the criteria or that they received the payments to which they were entitled, it said.

Wet pubs

Grants ranged from between €2,000 and €4,000 to €10,000 and €25,000 and up to €47,500 for so-called wet pubs in Dublin city centre.

A further €311 million was overpaid to businesses under the Covid-19 temporary wage subsidy scheme, or paid to companies ineligible for the scheme.

The C&AG also identified risks of irregular payments being made to people who could not work due to being Covid-19 positive, or medically certified to self-isolate or restrict their movements, as the Department of Social Protection did not check their PRSI contribution history before paying claims under the enhanced illness benefit scheme.