Tackle the fraudsters before increasing taxes

As Budget 2010 looms and fears intensify about how financially worse off the Irish citizen will be following its implementation, one area which needs to be policed more vigourously is benefit fraud. The State is losing hundreds of millions of euro each year through social welfare fraud.

This year child benefit is expected to cost the Government €2.5 billion, or 10 per cent of the social welfare budget, and while child benefit has been and continues to be targeted in a number of anti-fraud measures, further inroads into this area need to be made.

People working in Ireland who have children living outside the country are entitled to claim child benefit, but there is some evidence of people who are still claiming the benefit after leaving the country. This is where the waters become a little murky considering the high levels of child benefit which are paid in this country in comparison to our EU counterparts.

The standard of living in the likes of Poland is considerably lower than Ireland, and the family benefits paid in that country have been decided by the Polish government as a fair and adequate amount given the cost of living there. Six thousand families, where the children live abroad, qualify for child benefit in Ireland, with 80 per cent of them coming from Poland. That equates to 10,000 children living abroad who are in receipt of child benefit from this state.

What is certain is that the ordinary worker, whose family and children reside here and who must meet the high cost of living in this country, is less than happy to see family benefit payments being made in respect of children not resident here and mostly not incurring the same high cost of living. However our hands are tied, it’s an EU law, but we can no longer afford to administer it. Now is the time for Ireland to demand the suspension of this law because we simply cannot afford to keep paying benefits abroad.

It’s the Government who are partly to blame for the fraudulent side of things. The Government decided in their wisdom that some benefit payments should be made into bank accounts, but this generated its own problem. While this offered security for the Government, there was no security for the taxpayers who were being ripped off by fraudsters. Thankfully most payments now have to be collected at the Post Office and these control measures have helped the Department of Family and Social Affairs make considerable savings against fraudulent payments.

There is a big increase in the number of people reporting fraudsters. In the first six months of this year more than 2,500 reports of suspected fraud were made by members of the public. This has helped considerably in the crackdown. Anti-fraud measures saved the state over €228 million in the first half of 2009. Imagine how much more is being swindled.

But it’s not just migrant workers who should be targeted. There are plenty of Irish people defrauding the system. How many couples do you know who are claiming ‘lone parent’ allowance, when they are happily cohabiting as a family unit? Many of these couples are better off than the ordinary taxpayer due to the amount of benefit schemes available to them. There are genuine recipients of social welfare payments and hundreds and thousands of people who would sooner return to work and live an honest life. But for those thousands, there are as many more who are content to take the hard earned shilling from our pockets in benefits and handouts that they are not entitled to. That must be stamped out before one cent is taken from our pay packets in the form of tax.

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