Clamping down on a non-existent crime
The tsunami of fraud that allegedly plagues social welfare simply doesn’t exist
Published 19/04/2015 | 00:00
There was a time when you lost your job, or you got old or you had an accident and what happened was your family faced starvation. The State didn't care. Charity was hit and miss.
Crime was endemic, as people literally fought for the scraps that would feed their kids. The most ruthless prospered.
In this part of the world, just over a hundred years ago, there were the first stirrings of a civilised response to the slings and arrows of events beyond our control.
Pensions, unemployment benefit, sickness benefit and other benefits gradually came to be regarded as evidence of civilisation - like roads, street lights, a police force and an ambulance service.
All provided by the State - universal benefits that the private sector wasn't interested in providing, there being little profit in it.
This had to be funded. So, every time you earned money through work, or spent it in purchasing something - from a box of matches to a flat-screen TV - the State took a little bite and put the money into a pool from which benefits would be paid when you needed them. It's called social insurance and it's a great invention.
These days, after decades of right-wing propaganda, social insurance is treated like an infectious disease that must be isolated and beaten back into an ever-smaller corner.
Last week, Joe Duffy's Liveline patiently told story after story, day after day, of how the State is stealing money from widows and widowers. The State is mugging hard-working people, using cruel, underhand methods to deprive them of their own money.
Simultaneously, the routine propaganda attacks on social insurance continued, involving a deliberate belittling of the Irish people. Thousands of citizens have been encouraged to inform on their neighbours, and most of the allegations they've made are spurious, many are probably malicious.
The system is presented as a perverse mirror image - on the one side, the virtuous taxpayer, being ripped off; and on the other, those who live on "handouts".
And, according to the lies, large numbers of the latter are stroking the system.
The truth is otherwise. But that doesn't stop the Department of Social Protection repeatedly and spuriously claiming that it saved hundreds of millions of euro by attacking fraud; it didn't stop the Irish Times last week endorsing the Department's brutality.
For what it's worth, a 2011 assessment of the social welfare system - published by the Oireachtas Library and Research Service, from departmental data - concluded that social welfare overpayments in Ireland are on a similar level to those in other countries.
That is, within a range of 2-5pc of social welfare expenditure. It found an average of 3.4pc in Ireland.
These are overpayments - most of which are errors, a portion of which are fraudulent. The study found that in Ireland, in the year reviewed, the fraudulent portion was 21pc of that 3.4pc. Work it out.
There are examples of people persistently stealing over a period, and the system has to be protected against such attacks. There is, however, no tsunami of theft, there is no major problem, there is no danger to the social welfare system or to the larger interests of taxpayers.
There is - as in any human activity - error and there are people who give in to the temptation to claim for longer than they are entitled. There is a much smaller number of pros, who engage in fraudulent schemes that involve forgery and organised deceit.
It's legitimate to protect the system against such theft - and the system is effective. What isn't legitimate is the persistent propaganda in which ministers grandly announce they are "clamping down" - and the inevitable and bogus portrayal of a system under siege.
Before the economic collapse, mere hundreds of people responded to Ministerial urgings to inform on their neighbours. Last year, 21,000 did. And all but a small segment were either mistaken or malevolent - deepening a pool of suspicion and resentment.
Yet, all allegations - made anonymously - were investigated. Significant resources were wasted on such nonsense, but the department got to deepen the false division between the interests of "taxpayers" and "social welfare claimants".
Taxpayers are social welfare claimants. Social welfare claimants are taxpayers. The social insurance fund benefits us all - it is funded by us all, as part of the price of living in a civilisation. And most of us avail of it when we - as most of us do from time to time - go through difficult chapters of our lives.
The persistent propaganda that isolates and criminalises us when we claim social welfare has three purposes. To boost the Minister's profile (the current minister boasts of her "zero tolerance", as though she was taking on criminal gangs); and to frighten off people who might claim money to which they're not entitled.
Third: the need to patch up the hole in the economy kicked by the bankers and bondholders requires cuts in the cost of benefits. The propaganda traduces the system, making spending cuts seem a good thing, regardless of the damage they do.
It has other effects. Persistently claiming that "everyone is at it" increases fraud. What the hell, it suggests, you might as well chance your arm.
It also damages the legitimacy of the social insurance system, as people come to believe that it's a crime-ridden racket, the realm of the weak and the devious.
This creates pressure to reduce the social welfare bill - which (what a coincidence!) fits neatly into the needs of an austerity regime.
Most of us have periods of unemployment and periods of illness, periods of increased demands as we raise children or look after our elderly. Social insurance aims to smooth the peaks and troughs.
The results of the attacks on social welfare were clear on Liveline. Two people work alongside, one gets sick, can't work, claims sickness benefit - no problem. The other gets sick, claims - and is rejected. You are a widow, you get a widow's pension - no sickness benefit for you.
Listeners heard how this dodge was sneaked into a budget - oh, you clever bastards.
The Irish Times editorial, meanwhile, recycled the falsehood that, "In 2014, the department achieved overall savings of €505m by adopting a more aggressive approach in tackling fraud."
In truth, these are "control savings", the money that would have been lost over a period of years (with dreamt-up multipliers) if there were no controls. It is imaginary money.
Inevitably, encouraged by such cheerleading, the Department seeks to reduce costs and beef up its aggression. And it consequently deprives people of their entitlements - their own money - by design, or sometimes by over-enthusiasm.
Part of the right wing assault on social insurance involves renaming benefits as "handouts". However, we have already funded our own benefits. In the periods in which we work we pay income tax, at all times we pay VAT, which is a huge part of the taxation system.
When officials and politicians play tricks to deprive us of our benefits they are stealing our money.
Social welfare fraud, which obsesses some politicians and some journalists, is a pimple. The mountain is tax fraud - evasion and avoidance.
Social Welfare Inspectors raid workplaces, stop vans, use facial recognition technology - and gardai accompany them and arrest people. There is no equivalent aggression against tax fraud.
Many caught in tax fraud are allowed legally bribe the Revenue - by paying interest and penalties. These criminals walk away. A few are charged.
Big tax-dodgers employ accountants to find loopholes, through which they avoid paying their fair share of tax. How do the loopholes get there? All year, with the budget as a deadline, large accountancy firms lobby politicians and officials to insert the loopholes they will subsequently use to siphon off their clients' wealth.
This is class warfare, conducted by a well-resourced, influential minority. The propaganda against social welfare is but one front in that war.