25 Jul 2021

Errors cost MSD $22m in five years

11:20 am on 25 July 2021

The Ministry of Social Development has written off more than 42,000 debts totalling $22.6 million over the past five years, because it has discovered it has made a mistake and paid someone too much.

calculator and dollar bills in New Zealand currency

Photo: 123RF

But it cannot say how much it has had to backpay people, because they have ended up being underpaid as a result of an error.

Official figures, released to RNZ, show that since March 2016, MSD has written off about $1 million of debt each quarter, due to "office errors".

But MSD said it is unable to provide data about how many underpayments have been made due to office errors, nor how much it has had to pay in arrears, because that information is not centrally collated.

MSD group general manager client service support George Van Ooyen said when they become aware someone is not being paid at the correct rate, the problem is fixed and they let the person know.

"If they have been underpaid due to an error on our part, we repay any backpayments immediately," he said.

"If they have been overpaid due to an error on our part, any debt for overpayment can be wiped."

Van Ooyen said MSD tries to keep errors to a minimum.

"We are conscious debt write-offs are a cost to the taxpayer."

But he said against the wider scale of welfare payment and transactions, errors like this are small, making up about 0.1 percent of transactions dating back to September 2015 and 0.02 percent of payments.

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