Employers withholding PRSI contributions
De Rossa asked about the low number of prosecutions for benefit fraud and action against employers withholding employees’ contributions. Woods agreed prosecutions were few, described improved PRSI reporting and liaison, and acknowledged difficulties with employers.
Would the Minister agree that in view of the fact that in the years 1976-79 only 46 prosecutions took place against those employees who are alleged to be defrauding the Department of Social Welfare that in relation to the number of people in receipt of social welfare benefits that would indicate that a very tiny percentage of people are involved? Could the Minister also indicate what steps he proposes to take against employers who are defrauding the Department by withholding payments of contributions which they had taken from their employees?
Comment on this
The point the Deputy makes is a fair one. We have had considerable difficulty with employers in relation to the receipt of contributions. That came very much to light with the introduction of PRSI. From January 1981 the governing contribution year was the first year of paying PRSI to the Revenue Commissioners. A substantial number of employers were found not to be making returns. The system, through PRSI, has ensured that there is better liaison and there is some assurance of employers making contributions. I agree that the number prosecuted is very small, relative to the number of workers. Amounts of money can be more substantial than the numbers prosecuted would indicate. For a prosecution there must be a cast iron case with technical evidence and so on. The number of people who return money is much greater. Investigations produce people who receive money they are not entitled to but who have returned it. I agree that the numbers are small. There are other aspects which have a general effect. For instance, if one is on unemployment benefit one may have reimbursements of tax and so on, and this can make it somewhat less attractive to go back to work immediately. That is a problem. The Deputy raised the question of taxation. I was opposed to the taxation procedure put forward. It was against the principle I enunciated earlier that a person has a right to benefit. It meant deducting 20 per cent from the benefit before one got it and then one had to go to the Revenue Commissioners to see if one could claim it back.
