SkillsFuture overpayments: Gan Siow Huang says wrong applications not spotted

MOST of the lapses resulting in S$4.22 million in overpayments by SkillsFuture Singapore (SSG) were made prior to November 2020, back when SSG’s IT system for grants used a declaration-based approach, Minister of State for Education and Manpower Gan Siow Huang said in Parliament on Monday (Aug 1).

The overpayments, flagged in the latest annual Auditor-General’s Office (AGO) report, occurred between April 2018 and June 2021. Most lapses were caused by inaccurate or erroneous declarations by grant applicants and training providers that were not picked up by SSG’s internal checks, she said. IT system aside, errors were also made during manual processing of grants.

Responding to a question from Workers’ Party (WP) Member of Parliament (MP) for Aljunied Sylvia Lim about what remedial actions will be taken, Gan said that as at Aug 1, SSG has contacted all affected parties for recovery of overpaid funds and they “will be given time to check their own records and return any confirmed over-payment”.

A new IT system which uses administrative data for verification has been implemented since November 2020, to reduce reliance on declarations and manual processing, she added.

WP’s Lim had also asked how much had been defrauded or overpaid, as well as recovered, since the start of SkillsFuture in 2015. Gan did not provide such an estimate, noting that it has not been ascertained how much of the S$4.22 million in lapses involves fraud.

In a separate written response to Non-Constituency MP Leong Mun Wai on Monday night, Education Minister Chan Chun Sing said that since its inception in 2016, SSG has encountered three unrelated cases of fraudulent claims. The total amount defrauded was about S$42 million, including S$40 million by a criminal syndicate in 2017. SkillsFuture subsidies to individuals and companies amount to about S$700 million annually, said Chan.

Replying to a separate question by MP Yip Hon Weng about a S$43 million gap in Skills Development Levy (SDL) collection, Gan said that factors such as differences in employee data and fluctuation in monthly wages may result in differences between SSG estimates and actual SDL amounts paid by employers.

“SSG has adopted a risk-based approach to follow up on estimated variances,” she said, noting that overall variance between estimates of SDL payable and actual payment have fallen to 3 to 4 per cent today, compared to 18 per cent in 2008.

MP Tan Wu Meng asked about another AGO report finding of time lags and data errors that caused GST Voucher – U-Save rebates to be issued to ineligible households.

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In response, Second Minister for Finance Indranee Rajah said that there are practical constraints to keeping data updated, particularly as deaths must be reported by families, and this must be handled with sensitivity. The time lag issue affected about 3,100 households, about 0.3 per cent of households living in public flats.

She added that eligibility for the rebates are based on a pre-determined cut-off date, and no rebates will be issued to those who do not qualify after initial assessment. The GST U-Save vouchers provide lower- and middle-income HDB households with​ quarterly rebates to offset their utilities bills.