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FactCheck: do welfare recipients owe the Australian government about $3.5 billion?

8 August 2016
Gerry Redmond and Rodrigo Praino
The Conversation

from the article:

It is worth noting that while welfare fraud has been a long-term ongoing concern of Australian governments, it is unlikely that fraud is the major factor in over-payments to welfare customers.

[...]

Based on our reading of the available data, the claim that there is around $3.5 billion of debt to the Commonwealth due to fraud, non-compliance or misreporting in the welfare system is correct.

 

with this significant caveat from the article's reviewer, Timothy Prenzler (Professor of Criminology, University of the Sunshine Coast):

This analysis is based on data published by the Department of Human Services. It is as reliable as the department’s estimates. It would be good to see more detailed disclosures by the department about how the estimates are made. 

What is perhaps more interesting is why such large losses continue to be associated with fraud and error. Welfare fraud has been a political football for many decades and each side of politics, whether in opposition or government, claim they will crack down on fraud and reduce error. However, the estimates of large losses continue.

There is a very large hidden human toll to all this: the tens of thousands of people already in poverty, mainly women, who are prosecuted for fraud or catapulted into debt. What we need is a dedicated research unit within the Department of Human Services that can analyse why fraud and error occur, and develop methods to more effectively close off opportunities for it to happen. At present, there is little or no evidence of a systematic and scientific approach to the issue.