A CLAIM that welfare fraud was costing the State €2 billion annually, was rejected by Taoiseach Brian Cowen yesterday.

“That figure arose in respect of certain high-risk categories that were being investigated and a discrepancy of 10 per cent was found,” he said. “It is not right to extrapolate from that figure that the total level of fraud in the Department of Social and Family Affairs is 10 per cent.”

Mr Cowen was replying to Fine Gael leader Enda Kenny who said that in the RTÉ Prime Timeprogramme it had been estimated that social welfare fraud was running at 10 per cent. This led one "to believe the fraud is of the order of €2 billion per year, half of what the Minister for Finance is looking for in his overall cuts".

It appeared, said Mr Kenny, as if the department and the Minister had been “entirely incompetent in dealing with the scale of this robbery from the taxpayer’s pocket”.

Mr Cowen said the level of fraud in most schemes was very low.

“It is important to point out that the vast majority of people entitled to social welfare are those who need it and are obtaining it lawfully,” he added.

“There is ongoing vigilance, because of the need, in these difficult economic times, to make sure that those who most require our help obtain it and to ensure that anyone who is defrauding the system is identified and dealt with.”

Mr Cowen said that there were 620 staff involved in fraud detection, including a special investigation unit. People now collected money in person each week instead of having it sent to them, as was the case in the past, he added. Photographic identification was required when collecting payments.

“Across all schemes, 600,000 claims have been reviewed so far this year, including medical checks and certification to prove continued entitlement to child benefit,” Mr Cowen added. “Data matching with the department and with external agencies has been achieved.”

Meanwhile, Labour leader Eamon Gilmore criticised the Government’s decision to finalise all stages of the Social Welfare Bill, giving effect to budgetary measures, in the Dáil this week.

Mr Cowen said that two tranches of legislation, the welfare Bill and legislation to deal with the public sector pay, would be required following the budget.

The Government intended having the welfare Bill passed on Friday and deal with the public sector pay legislation next week.

Mr Gilmore said that the Bill was obviously intended to cut social welfare and the Government proposed to rush it.

“This is not acceptable,” said Mr Gilmore. “Apart from what he intends to do with the budget, this is an insult to the people, including the carers, the many people on disability, pensioners and people on social welfare payments.”

Mr Gilmore said that since the Government had decided the budget would be introduced this week, there would be very limited time to debate it before the Christmas recess.