Accommodation Supplement payment error

To be attributed to Ruth Bound, Ministry of Social Development Deputy Chief Executive Service Delivery.

The Ministry of Social Development has identified and fixed an error in its automated payment system which resulted in incorrect Accommodation Supplement payments to some clients.

I can confirm that people granted the Accommodation Supplement since December 2014 are receiving the correct rate of payment.

The error dates back to 1993 and the Ministry is currently reviewing the scope and scale of the impact on people who received the Accommodation Supplement from this date.

Initial analysis shows that more people were overpaid than underpaid.

This analysis shows that of people who received the Accommodation Supplement historically over the 21 year period, 87,000 people had discrepancies that affected their payment.

Of these, just over 41,000 people have been underpaid with total underpayments of around $23 million and just under 46,000 people have had overpayments of around $32 million. The vast majority of underpayments are less than $1,000.

There are currently around 286,000 people receiving Accommodation Supplement totalling around $1.2 billion per annum. Approximately 800 clients currently receiving Accommodation Supplement are affected by the error.

Work is underway right now to work through options to address the error and do the right thing by people who have been underpaid.

MSD will report back to Ministers by the end of June on proposals to address the error.