KEY POINTS:
New Zealand's biggest benefit cheat owes more than $220,000 - and is repaying the debt at just $25 a week.
Ministry of Social Development figures released to the Herald on Sunday show the country's four worst welfare cheats collectively owe nearly $800,000, which is unlikely ever to be
recovered.
Welfare fraud costs the country hundreds of millions of dollars a year, with most culprits never caught. Those who are prosecuted - 994 in the 2005/2006 financial year - usually have to repay what they owe, but the repayments are often so small that it would take the ministry several lifetimes to recover the money.
Despite this, the ministry is encouraging the public to dob in cheats. Last year, it investigated 12,094 cases of suspected fraud after complaints from the public and of those it established overpayments in 1882 cases, of around $19 million.
Ministry chief executive Peter Hughes said while tip-offs were 30 per cent down on the previous year, it seemed that early intervention was proving successful. He believed the decrease in tip-offs was a result of the ministry's efforts in deterring people from committing fraud, as well as a decrease in the number of people receiving an unemployment benefit.
However, critics say the recovery system is flawed as all the ministry can do is try to get back as much money as possible without putting the cheat below the poverty line.
National's welfare spokeswoman Judith Collins believes fraudsters should have to work off their debts.
Ministry figures show the $220,000 owed by the biggest welfare cheat - an invalids beneficiary - won't be paid back for 212 years.
The highest debt owed by a sickness beneficiary is $201,376, which is being repaid at $32 a week. Theoretically, it won't be paid off until 2138.
The country's biggest unemployment benefit cheat owes $174,686 and, paying around $40 a week, will be in debt until 2097.
Just over $200,000 is owed by the worst domestic purposes benefit cheat and with repayments of around $70 a week it won't be repaid for 59 years.
Hughes said the ministry "actively pursued" any debt.
"We continue to work hard to prevent benefit fraud, while acknowledging that some people are simply determined to commit fraud," he said.
"I am confident that for those defrauding the system it is only a matter when, not if, they will be caught."
- HERALD ON SUNDAY
