Millions in Covid aid wrongly paid

The auditor-general’s office has no idea how many funds in Covid benefits were handed out to ineligible applicants from 2021 to 2022, with the real number possibly being many times more than the €11.9 million already tracked by the government, it emerged on Thursday.

The matter of Covid benefits and grants given out during the pandemic was discussed at the House audit committee, reviewing the Audit Office’s special report on the ministry of labour and social insurance covering the years 2020 and 2021. The report’s segment regarding specifically the Covid-related benefits extended to the year 2022.

In parliament, Labour Minister Yiannis Panayiotou acknowledged shortcomings in verifying, in the midst of the pandemic, whether applicants for Covid-related assistance – individuals and businesses – were in fact eligible.

“We ascertained major weaknesses when it came to government databases ‘talking’ to each other,” he told MPs.

The government continues trying to recoup monies wrongly disbursed, Panayiotou said.

According to labour ministry data, to date the total recoverable amount comes to €11.9 million. This amount, however, relates only to what has been tracked so far; checks are ongoing.

Of the €11.9 million, the government has been able to collect €4.3 million. Meanwhile a number of beneficiaries of Covid-related assistance, contacted by the government to return the money, successfully appealed the process and got to keep the money – this concerns €3.7 million.

The amount still pending for recovery comes to €3.3 million.

Nearly €1 billion was handed out by the labour ministry alone as part of the various Covid support schemes.

Commenting on the erroneous handouts, the Audit Office has this to say in its report:

“Taking into account that a percentage of the €940 million has been paid out to non-eligible persons and given the inherent limitations on our agency during the material time, we were not in a position to estimate the total amount given to those who were non-eligible.

“We recommended that the necessary action be taken to recoup the amounts given in cases where it was established that the recipients were ineligible for assistance.”

Contacted by the Cyprus Mail later in the day, Audit Office spokesman Marios Petrides confirmed that they cannot even guess at the actual amount in benefits wrongly given out.

“But as a general comment, we know that many, many people benefited who shouldn’t have. Businesses that never suspended operations or fire employees, managed to get assistance.”

He added: “But on the flipside, people who did get fired as a result of the pandemic, never got any compensation via the government schemes.”

Overall, from March 2020 through to October 2021, the government rolled out several Covid schemes. The schemes got rolled out in 20 periods. For periods 1-3 and 10-13, the checking of the applications was done by the labour ministry itself. For periods 4-9 and 14-20, the checks were outsourced to private-sector professionals.

The various government schemes to support people during the Covid pandemic related to self-employed persons as well as small-to-medium sized businesses.

The first two confirmed cases of Covid-19 in Cyprus were announced on March 9, 2020. The first general lockdown was imposed from March 24 to April 13.