Fewer people commit fraud and the system is fair and sustainable

We take all forms of fraud seriously. We will continually review and adapt the measures we have in place to prevent, detect and investigate internal and external fraud.

Maintaining the integrity of our service

Fraud reforms

In 2012/2013, we continued to strengthen the Ministry’s approach to welfare fraud with a programme of reforms. We are making sure that social assistance goes only to those who are eligible and applicants understand their obligations. 

In February 2013, the Social Security (Fraud Measures and Debt Recovery) Amendment Bill was introduced into the House. Changes in this Bill will provide us with more tools to ensure those convicted of fraud pay their debt. Partners of clients committing relationship fraud will also be held to account when the non-beneficiary partner has gained advantage from fraud they knew of or ought to have known of.

In early 2013, the Government announced new measures to make fraud more difficult to carry out, and easier to detect and recover.

New measures

We have made several significant changes to strengthen our action on fraud. 

• The Welfare Fraud Collaborative Action Programme (WFCAP) takes a proactive multi-agency approach to fraud. It uses the tools and resources of all agencies involved, to identify and investigate people committing fraud.
• Since 15 July 2013, we have been working on benefit eligibility relationship rules for implementation in 2013/2014.
  • We provide clients with more online information before they apply, including relationship status rules and potential benefit eligibility.
  • We ask people applying for Sole Parent Support to provide details of a third person who can confirm their relationship status.
  • We check clients understand how relationships can affect their benefit eligibility and what they need to do if their circumstances change. This includes follow-up meetings.
• The Code of Conduct for obtaining information under section 11 of the Social Security Act 1964 has been changed, removing the need to notify a beneficiary they are under investigation. 

As at 30 June 2013, 11 multi- agency cases were under investigation in the WFCAP.

Benefit fraud prosecutions

Where we find evidence of fraud, we prosecute. In 2012/2013, we completed 979 benefit fraud prosecutions. Of these, 96 per cent were successful. These cases can cover more than one fiscal year due to the time lag between a completed investigation and the final court decision. 

We established $26 million of fraud debt and we recovered more than $3 million in 2012/2013. The total balance of fraud debt owed to the Crown is $128 million.

Information sharing with Inland Revenue

We put in place a new way of sharing information with Inland Revenue during 2012/2013. It helps us to detect welfare fraud and to identify more quickly the correct benefit entitlement for clients earning income.

The first information share was in March 2013. We now receive income and employer information from Inland Revenue for all working-age people in receipt of a benefit. This tells us earlier and in more detail about clients’ changes in employment and income. Over time we expect that our information-sharing arrangement will:

• allow near real-time assessment of people’s correct entitlement to social assistance because we will have up-to-date information on the income they are earning
• result in fewer errors by staff and less compliance work for both clients and the Ministry. 

As at 30 June 2013, information sharing helped us to identify 3,000 clients no longer entitled to assistance.

Data matching

We match information with other agencies to ensure that people are entitled to the support they receive. Data matching helps us to identify clients receiving benefits/allowances to which they are no longer entitled. 

In 2012/2013, there were 10 different data matches across six government agencies.

2012–2015 Statement of Intent Performance Indicators

Fewer people commit fraud and the system is fair and sustainable

Intermediate Outcome – Fewer people are able to commit fraud

Intermediate Outcome – Fewer fraud overpayments are made

Intermediate Outcomes – More fraud overpayments are recovered, fraud is detected sooner

1. These fraud overpayments come from more than one year due to the lag between a completed investigation and the final court decision.