The Department of Social Protection has agreed to seek sanction in advance from the Department of Public Expenditure, NDP Delivery and Reform (DPNDPDR) for any future ex gratia payments after the Comptroller and Auditor General's report found payments made to social welfare branch office managers in 2022 were "irregular" because such permission had not been sought.
The Department of Social Protection made payments totalling €1.425 million to branch managers in 2022, stating they were in response to financial pressure on the branch officers because of inflation and the need to deliver services for Ukrainian claimants.
The payments ranged between €16,000 and €51,000.
However, the C&AG’s report said the department based the proposal for the payments on general cost increases in the economy and did not provide a "detailed, evidence-based assessment" of the impact the increases in the cost of living and demand for services had on branch offices.
Without such detail, the report said it is difficult to determine if there was a valid case for making any top-up payments.
It said these payments represented a "significant enhancement" of a pay structure agreed in 2018.
It said they also used up funding that would otherwise have resulted in a saving to the Exchequer.
The use of savings in this way should have been approved in advance by DPENDPDR and since this sanction was not sought, the expenditure was irregular, it added.
In response, the department said it would apply a default rule of applying for sanction for one off/ex gratia payments in all but exceptional cases, with immediate effect.
The C&AG's report also found that a revised structure of payments to branch managers agreed in 2018 continued after it was due to expire at the end of December 2020.
The revised arrangements had been sanctioned by DPENDPDR but that department had requested they should not be extended without its input.
The Department of Social Welfare continued the revised arrangements in 2021 and 2022 without seeking further sanction.
It stated that given the "unique circumstances" of the Covid-19 pandemic, it operated on the basis that the sanction granted in 2020 automatically continued for 2021 and 2022.
The department agreed with the recommendation in the C&AG’s report that it should engage with DPENDPDR to agree on an approach to discussions with the branch office managers on future contract terms and governance arrangements for the branch offices.
