New procedures proposals and implementation

The main task of the consultant within the pilot projects was to apply the HMT model for the needs of the welfare office and to strengthen the institutional role of the public social inspector. The pilots were launched in April 2009. Throughout April-December 2009, the consultant developed models for indirect income testing, prepared and improved several versions of questionnaires for collecting data at pilot offices, and explored the possibility of an in-the-field application of the theoretical HMT model. In addition, the consultant examined possibilities for strengthening the role of the public social inspector by eliminating the drawbacks of the current legislative framework and exploring how best to apply anti-fraud policy practices in Ukraine.

The outcome of the project was a proposal on HMT model application and a proposal for strengthening the mechanism used for processing applications and implementing surveillance procedures for monitoring recipients. The latter proposal assumes a comprehensive strengthening of the system by means of (a) introducing extensive investigation procedures for suspicious and special cases, (b) unifying pre-selection mechanisms for recipients’ surveillance which will be based on fraud risk analysis. In addition, an indispensable part of strengthening the system will be revising the local commissions’ role in application processing and correctly allocating stimuli for welfare offices and benefits/subsidy recipients.

Although a broad based approach is proposed for reshaping the mechanism for processing applications and surveillance of recipients, future pilots will concentrate on two components (a) testing the potential application of HMT for social assistance needs and (b) improving investigation procedures for strengthening the role of the public social inspector.

Based on the analysis of the HMT model, we have concluded that one of the ways of applying the HMT approach is by ranking benefits/subsidies recipients from the most risky to the least risky based on the difference between declared and estimated income. The most risky recipients should be pre-selected for investigation. The essence of the experiment is to test whether the pre-selection of cases for investigation is more efficient based on the HMT approach or if the current pre-selection method works just as well.
The second component of the experiment, the improvement of investigation procedures, will concentrate on testing mechanisms for collecting evidence of social assistance fraud. We see the investigation procedure as a mechanism for collecting information about suspicious cases which are later to be processed by a court or local commission. Within the experiment, new methods for home visits will be tested. Points will be assigned by the social inspector during the home visit based on the wellbeing of the benefit/subsidy recipient. In addition to assigning points, we consider it useful to test an application of an in-depth interview under caution. The main goal of the experiment is to test the usefulness of the extended tool kit which can be at the disposal of social inspectors for collecting evidence of fraud.