Justice
Welfare Fraud Cheats Us All
Social welfare fraud costs the Irish state €40m (link)
Tax evasion fraud costs the Irish state €400m (link)
White collar crime fraud costs the Irish state €2,500,000,000m (link)
William Priestley
The debate about the public services card over the summer brought a number of issues to light. One of the most prominent is the revelation that less than €2m in welfare overpayment has been identified since 2011. The relative insignificance of this number becomes all the more curious when we consider that such savings were highlighted as one of the card’s main selling points. By nearly every metric, the €60 million needed to implement the card system has been a poor investment for combating fraud. Unfortunately, the pursuit of this crime in Ireland is neither logical not equitable.
In 2017, the then Minister for Social Protection, and now Taoiseach, Leo Varadkar, set up a telephone hotline for citizens to report on those they suspected of committing social welfare fraud. It was launched with the tagline: ‘Welfare Fraud Cheats Us All’. We would have to wait over a year before there was any corresponding infrastructure established to report bankers, businessmen or politicians. This was despite the fact that their actions had a far most celebrated track record of defrauded the state and a small coterie of whom were central to the terrifying feat of nearly bankrupting the country itself not ten years previous. Of all the things welfare fraud cheat us of, perspective is the most corrosive.
Steal a lot and they make you king
Since the founding of the state, Ireland’s approach to fraud has been defined by Dylan’s lyrics: ‘Steal a little and they put you in jail, steal a lot and they make you king’. The poster boy was, of course, Charles Haughey, who, as leader of the country, enriched himself by trousering over forty million euros and never spent a day in prison for his crimes. Recent memory saw tribunal after tribunal revealed fraud and perjury that was both audacious and breathtaking. Sadly, they delivered little by way of convictions.
The cost to the Irish state of social welfare fraud is in the region of €40 million each year: or roughly one-tenth of revenue lost through tax evasion. An eye-watering two thousand million is thought to be siphoned off by the captains of industry through white-collar crime. While one can legitimately argue that a crime is a crime and should be prosecuted accordingly, social welfare fraud and white-collar fraud are the same thing only in the sense that Manchester United and Chesterfield Town are both football clubs.
Despite the chasmic discrepancies in these numbers, there remains a persistent obsession in the public discourse with single mothers sneaking their partners into social housing and dole recipients doing nixers on the side. To this end, social welfare fraud is visible and relatable in a way that white-collar crime is not. There is also a very visceral connection between our taxes and their subsequent uses. If we are genuinely worried about the uses of our taxes, we could do worse than start with the €14 million interesting being paid every day on the national debt. Roughly €10 million of which is as a direct result of the actions taken by the leaders of capitalism during the boom.
Being on social welfare in the first place is a fraud of sorts
Sadly, many people consider that being on social welfare in the first place is a fraud of sorts. It follows that dole queues are filled with ‘layabouts’ and ‘wasters’, who live off the brow of the working man. The complexity of opportunity and equality are drowned out by mantras such as ‘Just Get a Job’. This mindset is also underpinned by the dismissive and arrogant belief that the aspirations of those marginalised in our society do not stretch beyond earning €203 a week: that they have no hopes, dreams or ambitions.
This preconception of ‘the other’ compounds the blinkered focus of fraud. The majority of social commentators and policy mandarins are more likely to count a banker, a solicitor or a businessperson among their social circle than someone on a lone-parent allowance. It is this type of echo-chamber insulation than allowed the mass media to be so blindsided by Brexit and then Trump. When it comes to fraud and objectivity, it is a lot easier to pour scorn on ‘the other’ members of societies than the other members of the dinner circuit.
Social welfare fraud exists in the same way that fraud exists amongst every group of citizens, whether that be police officers, farmers or builders. The only difference is the extent to which it is pursued. They have been no convictions or even tangible consequences from the financial scandal surrounding the Garda training college ‘Templemore’ (2017). This is even though some of the scams being pulled would make Derek Trotter blush.
The collapse of Anglo Irish Bank cost the Irish state €35 billion or an accumulative 100 years of social welfare fraud. In 2016, three senior officials were imprisoned for their misconduct. Eighteen months later, Daniel Daudet, a young music teacher, would be giving a longer prison sentence than all three for fraudulently claiming social welfare benefits. His crime was egregious. It is unclear, however, whether it was more egregious than the world’s biggest banking scandal.
Social welfare fraud is a crime and, like all crimes, it should be pursued. Unfortunately, the resources invested to combat the different types of fraud in Ireland are inversely proportionate to their scale. Middle Ireland’s ire is systematically directed downwards at the least empowered in our society instead of upwards at those, who by every metric, are causing them significantly more harm. By allowing ourselves to be distracted by emotive and isolated cases of criminal behaviour, we turn in on ourselves as a society and on the vast majority of those supported by our welfare system. We are, in effect, cheating ourselves. By both revenue and consequence, white-collar crime is a far greater threat to the Irish state. The systemis being gamed, absolutely: just not by the poor.